CHN: Senate Takes First Step to Reauthorize the Farm Bill; SNAP/Food Stamps Cut

The Agriculture Reform, Food and Jobs Act of 2012 that was approved in the Senate Agriculture Committee on April 26 cuts the Supplemental Nutrition Assistance Program (SNAP) funding by $4.49 billion over 10 years.  The cuts would come from restrictions to the “Heat and Eat” program causing an estimated 500,000 low-income households from 14 states and the District of Columbia to lose an average of $90 per month in benefits according to the Congressional Budget Office.  The cuts would be phased in beginning October 1, 2013.  The “Heat and Eat” program allows participating states to coordinate SNAP and the Low Income Energy Assistance Program (LIHEAP) allowing the LIHEAP agency to provide cash benefits directly to SNAP households.  “Heat and Eat” is particularly beneficial to households with elderly and disabled members who are not subject to an arbitrary cap on the amount of their SNAP shelter deduction but who often face the choice between heating/cooling their homes and having enough to eat.
SNAP is a highly effective anti-hunger program that helped provide food to more than 46 million low-income persons in January 2012.  Approximately 92 percent of the program cost goes directly to beneficiaries to purchase food with the remaining used primarily for administrative costs.  Program critics have attacked the steep increase in program participation during the last several years. The increased participation rates reflect the counter-cyclical nature of the program which is designed to expand to meet the need when the economy is in a downturn.  Contrary to inflated allegations of fraud and abuse in SNAP, according to the Center on Budget and Policy Priorities the combined error rate (overpayments and underpayments) was at an all-time low of 3.81 percent in 2010.  Nonetheless, one change made in the nutrition title of the bill lowers the quality control tolerance threshold from $50 to $25.  Minor errors in the $25-50 range will increase states’ payment error rates, subjecting the program to more allegations of fraud and abuse.

Several programs in the nutrition title of the bill would receive modest increases from reinvesting a small portion of the SNAP cut.  Mandatory funding for the Emergency Food Assistance Program (TEFAP) commodity purchases is increased by $150 million over 10 years, frontloaded in the first years in light of the immediate need.  The bill provides $5 million annually for Community Food Projects.  The bill would add $185 million over 10 years to prevent the sale of SNAP benefits.  The net cut to the nutrition title of the bill is $4.024 billion over 10 years.

In total, the Agriculture Reform, Food and Jobs Act of 2012 would save $24.7 billion over 10 years.  In addition to the SNAP cuts, the bill would end direct payments to grain and cotton farmers, consolidate farm and conservation programs and tighten restrictions on federal payments to farmers.  The bill passed the Committee by a vote of 16-5 with Senator Gillibrand (D-NY) the lone Democrat opposing the bill due to its deep cuts in SNAP.  She plans to offer an amendment addressing the cut when the bill comes to the Senate floor.  Four Southern Republican Senators – Boozman (AR), Chambliss (GA), Cochran (MS), and McConnell (KY) – opposed the bill due at least in part to treatment of commodities grown in their states.  Committee Chairwomen Stabenow (D-MI) has agreed to work with them to address their concerns.

The current farm law expires on September 30.  It will be a challenge to complete a reauthorization bill to meet that deadline.  It is expected that a temporary extension of current law will be needed.

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