2014 Farm Bill: Congress Cuts $8.6 billion in SNAP Benefits; Improves U.S. Food Aid Programs

Remember how this was supposed to be the Farm Bill of 2012? The measure then became the Farm Bill of 2013. After months of endless debate, the Congress finally approved the Agricultural Act of 2014 a couple of weeks ago.

Improvements in International Food Aid
While most of our attention has been focused on the impact on domestic nutrition benefits, let me first mention first the positive impact on U.S. international food aid. The measure makes food-aid programs more efficient, enabling the greatest impact possible while improving food-aid quality and nutrition. This includes increased cash flexibility for development programs and establishing a permanent local and regional procurement (LRP) program with funding up to $80 million a year. We will continue working on this issue in Bread for the World's 2014 Offering of Letters.

On the domestic nutrition front, the news is not as good (or less bad than what had been anticipated?) The Farm Bill cuts food stamp benefits by about US$8.6 billion over 10 years. The reduction in SNAP benefits is not as drastic as the e $40 billion cut that the Republican-led House had proposed in 2013.

While many anti-hunger advocates are relieved that deeper cuts were averted in this climate of tight budgets, we must go beyond the statistics. Real people will be affected by the reduction in food stamp benefits, as the SNAP cuts will be a significant blow to the 850,000 households that will lose about $90 a month in benefits at a time when hunger in America remains at an all-time high.  As Bread for the World President David Beckmann points out in the Bread blog, "Any cut to SNAP is harmful."

Closing 'heat and eat' loophole has little impact on New Mexico

So how will SNAP benefits be reduced? The Farm Bill achieves these cuts primarily by reforming a provision that allowed many states to link the Low-Income Home Energy Assistance Program (LIHEAP) with SNAP benefits, in what some advocates referred to as "heat and eat."

New Mexico was among the 15 states (and the District of Columbia) that had been using this formula to provide both heating and food assistance to low-income families via a single application.  However, the closing of the LIHEAP-SNAP "loophole" will have very little direct impact on New Mexican households, which is a good thing because our state ranks near the bottom in food insecurity. A provision in the Farm Bill legislation specifies that low-income residents that receive more than $20 in LIHEAP each month will still be elegible to concurrently obtain SNAP benefits, which applies to the vast majority of the low-income households that participate in LIHEAP each year. The energy-assistance program served almost 65,000 households in New Mexico in 2012.

The picture is not pretty elsewhere. The nonpartisan Congressional Budget Office projects that the provision in the Farm Bill that tightens this link between food stamps and LIHEAP could affect about 850,000 households, or 4 percent of SNAP beneficiaries. This change will hurt many low-income households in California, Connecticut, Maine, Massachusetts, Michigan, New Hampshire, New Jersey, New York, Oregon, Pennsylvania, Rhode Island, Vermont, Washington, Wisconsin, plus the District of Columbia.

21 million fewer meals in Oregon
According to the Oregon Food Bank, struggling families in that state will receive $54 million less next year because of the Farm Bill.  Based on an average cost of $2.59 per meal in Oregon, this translates into 21 million fewer meals next year, or 57,000 each day, said Jeff Kleen, the food bank's public policy advocate.  Read More in the The Bulletin newspaper, based in Bend, Ore.

Low-income families in New Jersey, Pennsylvania, New York, Vermont and other states on the list face a similar predicament as those in Oregon.

Funding for LIHEAP has dropped in recent years, from $5.1 billion in 2009 to $4.7 billion in 2011 and $3.49 billion in 2013, according to the Department of Health and Human Services, which administers the program.

Still, LIHEAP is targeted toward vulnerable populations, which means that the elderly, families with very young children and the disabled, could lose access to SNAP via this method. When the proposal first came up in the Senate Agriculture Committee in 2013, the Food Research and Action Center expressed its opposition to cutting the link between LIHEAP and SNAP.  "This is in recognition that too many st ruggling Americans face an impossible choice between paying for food or paying for energy," said a FRAC study.

A 'Reasonable' Tradeoff? 

Some anti-poverty advocates, even progressives like Robert Greenstein of the Center for Budget and Policy Priorities, believe that this was a reasonable tradeoff to keep Congress from cutting benefits altogether from recipients who receive food stamps directly.

"Some states are stretching the benefit formula in a way that enables them not only to simplify paperwork for many SNAP households, but also to boost SNAP benefits for some SNAP households by assuming those households pay several hundred dollars a month in utility costs that they do not actually incur," Greenstein wrote in a recent article

"Congress did not intend for states to stretch the benefit rules this way, and longstanding SNAP supporters like myself find it difficult to defend.  Moreover, a future Administration could close off this use of the rule," added Greenstein, in reference to a practice by some states to give anyone who qualified for as little as $1 in LIHEAP concurrent access to SNAP benefits.

Miranda Everitt, a graduate student at the Goldman School of Public Policy (University of California) offers a different perspective in a piece she wrote for the Berkeley Blog. "While we might prefer an across-the-board increase in food-stamp benefit levels rather than allowing states to use a “loophole”; Congress is unlikely to agree," said Everitt. "In a time of decreasing public commitments to anti-poverty programs, ending the practice of heat-and-eat deals a serious blow to impoverished citizens that the Obama administration has committed to assist."

An editorial in The Washington Post supported the closing of the loophole, but also suggested that Congress should have made deeper cuts elsewhere."Considered in isolation, this trim is both modest and justified; it closes a loophole that enabled states to award extra benefits by fiddling with recipients’ household budget data. It was preferable to the larger cuts Republicans wanted," said the editorial. "But attached to so much corporate welfare, it’s hard to swallow, especially when that corporate welfare isn’t rigorously means-tested."

Rep. Michelle Lujan Grisham, who sits on the House Agriculture Committee, had a mixed reaction to the bill. "At a time when hunger and poverty continue to plague small towns and big cities across America, it is unconscionable that this bill cuts $8.6 billion from the Supplemental Nutrition Assistance Program," Rep. Lujan Grisham said in a news release. "And while I am pleased that none of these SNAP cuts directly affect New Mexico beneficiaries, the reality is that hunger and poverty are exploding in our state, and we must do more. Congress should be expanding nutrition assistance, not slashing it."