The USDA has proposed changes to the SNAP program — formerly known as food stamps — that could make more than 35,000 Ohio residents no longer eligible for SNAP benefits. The proposal, which involves the state’s ability to adjust income guidelines and asset limits, could also increase the demand for social safety net services, including the Greater Cleveland Food Bank.
Last month, the USDA proposed a rule change that would eliminate a policy known as ‘broad-based categorical eligibility.’ Adopted in 43 states, the policy has expanded the number of people eligible for SNAP benefits. Broad-based categorical eligibility allows states to grant SNAP eligibility if recipients are receiving Temporary Assistance for Needy Families benefits — or TANF.
Residents applying for SNAP benefits must meet federal poverty level guidelines, which amounts to roughly $27,000 per year for a family of three. However, under Ohio’s broad-based categorical eligibility policy, no limits are placed on assets, meaning applicants are permitted to have a modest savings account while still maintaining eligibility. Without the broad-based categorical eligibility policy, as many as 37,000 Ohioans and their dependents would lose SNAP benefits.
“If a household is saving even just a few dollars a paycheck and they get above a certain amount, getting rid of the broad-based categorical eligibility option would mean households would be removed from the program just for having a modest savings,” said Kimberly Lovano, the director of advocacy and public education at the Greater Cleveland Food Bank. “Even if you are trying to be proactive and save for those things that are to come unexpected in life that we all deal with, you would essentially be penalized for getting a modest savings in your bank account.”
Proponents of the rule change argue that states have exploited the policy, which was ramped up by the Obama administration during the Great Recession. According to the USDA, eliminating the broad-based categorical eligibility policy would save an estimated $1.9 billion a year.
“The average amount of money that someone has in their savings account that is on SNAP is about $375,” Lovano said. “Getting folks to be able to save a little bit more paycheck by paycheck, I wouldn’t say that’s creating a loophole; it’s giving people a path to financial security.”
Lovano said eliminating the policy may actually be an incentive for people to not put away money in savings.
“If you are saving two extra dollars and you hit that limit then you are removed from the program. You are losing $100 to $200 a month so it doesn’t make sense to save,” Lovano said. “In order to get any sort of financial security and not receive SNAP benefits in the future, you have to be able to save for all the unexpected expenses that come up in life.”
If an estimated 3.1 million people nationwide were to lose their SNAP benefits, it stands to reason that many of them would seek assistance from places like the Greater Cleveland Food Bank. While food bank officials insist they would never turn anyone away from getting assistance, the increased demand might become untenable. That’s because for every meal that a food bank provides, the SNAP program provides nine. Additionally, eliminating the broad-based categorical eligibility option would cause an estimated $3 billion hit to the grocery store industry, which already has razor-thin margins.
“Any time there is a change that is going to cut people off of the program, we know there re going to be more people at food programs, food pantries and hot meal sites instead of grocery stores where they can use their SNAP benefits,” Lovano said. “Nationwide there are going to be food banks that are seeing a significant strain in the amount of resources that we have to try and feed those additional 3 million people.”
The USDA is accepting public comment on the proposed rule change through late September.