Relates to application to the department of agriculture for waivers for federal food stamp program

Justification

Federal Food Stamps (now SNAP) is the principal federal anti-hunger program, with 100% of the benefits being paid for by the Federal government New York is unusual, compared to most states, in that it allows the local counties and New York City to administer the program rather than having the state operate the program directly.

The Personal Responsibility and Work Opportunity Reconciliation Act of 1996 (PRWORA) limited the receipt of Food Stamp/SNAP benefits to 3 months in a 3-year period for able-bodied adults without dependents (ABAWDs) who are not working, participating in, and complying with the requirements of a work program for 20 hours or more each week.

Individuals are exempt from this provision if they are:

* under 18 or 50 years of age or older,

* responsible for the care of a child or incapacitated household member,

* medically certified as physically or mentally unfit for employment, pregnant, or

* already exempt from the work requirements of the Food Stamp Act.

States may request a waiver of this provision for people in areas with an unemployment rate above 10 percent or for those in an area with insufficient jobs. States also have authority to exempt individuals using the 15% exemption authorized by the Balanced Budget Act. In 2008, 38 States had Waivers from this provision (including NY State with the exception of New York City). These rules create a significant administrative burden for the state, due to the extra levels of bureaucracy involved in tracking these individuals. As a result all but four states (Vermont, Iowa, New Hampshire and Delaware) have applied for waivers from this rule during this past year. Our State's policy has been to apply for a waiver, and then allow each county to decide whether or not to apply the more stringent work requirement. New York City, in particular, has opted to restrict food stamp availability.

Moving to a statewide waiver will not increase administrative costs, in fact many states in their filed plans with the USDA referenced administrative savings. Eliminating this restriction and moving to a state-wide consistent plan will simplify the administrative tracking and decrease the chance of Federal Quality Control Errors, saving the State money.

Increased participation in Food Stamps decreases demands on emergency food programs (which are significantly paid for by state and local government), improved access to food decreased nutrition related health costs, and each dollar in Food Stamp spending generates a $1.73 in economic activity in the local economy creating jobs and tax revenues.

The ARRA of 2009 provides $295 million for SNAP/Food Stamp administrative costs, almost all of it to states. The formula is based on a combination of each states' shares of SNAP/Food Stamp households in last 12 months and caseload increases in last 12 months. NYS has seen a significant increase in Food Stamp participation in the last year and anticipates even more growth in applications, hence NYS receive a significant increase in Federal administrative dollars which far exceed any administrative costs of this sub-population of applicants.

The 2009 American Recovery and Reinvestment Act (ARRA) includes provisions which expand the availability of Food Stamps/SNAP. Similar expansions have been a part of the federal response to most recessions, and for good reason: there is no more efficient way to prime the economy's pump.

According to an econometric model of the US economy developed by Moody's, every extra dollar that is distributed by the federal government through the food stamp program generates $1.73 in gross domestic product within the same year. (Mark Zandi, Testimony to Congress, 1/6/2009 available at http://www.economy.com/mark-zandi/documents/Economic Stimulus House Plan 012109.pdf). The effects of increased food stamp assistance on our economy are more immediate and more profound than personal income tax rebates ($1.03 per dollar invested) or infrastructure spending ($1.59 per dollar invested). New York will have to utilize every available tool to stave off the worst effects of this recession, which includes deploying every dollar that is available through the federally funded food stamp benefits program.

Under ARRA, the "three months in three years rule" has been lifted until 2011 in order to facilitate the efficient distribution of food stamp assistance. New York City has indicated an intention to continue to restrict access to food stamp benefits, despite the proven economic stimulus that result. The State of New York cannot afford to allow the City of New York to continue to decline this infusion of federal dollars.

If either the State or a county choose not to accept a particular food stamp waiver, tens of millions of dollars in federal food stamps may not be used at New York grocery stores and farmers' markets. This reduced spending may reduce the number of entry level jobs in food stores in distressed neighborhoods - jobs that could be filled by former program participants. Overburdened nonprofit food pantries and soup kitchen are forced to feed additional hungry people even though a federal program is available.

This bill would allow New York to maximize food stamps coming into our communities, benefit our local economies, improve nutrition, reduce hunger, provide additional markets for farmers, and reduce the burdens on emergency food programs. By simplifying Food Stamp rules and creating one policy statewide, it will further decrease Food Stamp Administrative Error Rates.

Legislative history

1999/00 A.7470A 2001/02 A.959 2003/04 A.514 2005/06 A.2655 2007/08 A.4046

Fiscal implications for state and local governments

None.

Regulation impact

The Office of Temporary and Disability Assistance will inform local social services districts of approved federal waivers.

Effective date

Immediate.