State Capitol Facing North Office Building

Critics: Food Stamp Asset Test is Bad Policy

The Department of Public Welfare will reinstate a food stamp asset test on May 1st.  “It will help to ensure that individuals will first deplete all readily available resources before relying solely on public assistance, and as a result preserve the benefit for those who have no other additional means or resources,” explains DPW spokeswoman Carey Miller. 

But the testimony received by the House Human Services Committee focused largely on the negative effects that some foresee for Pennsylvania’s most vulnerable citizens.  “SNAP benefits are good for needy families and they’re good for the economy,” says Louise Hayes from Community Legal Services.  SNAP refers to the Supplemental Nutrition Assistance Program, which is commonly referred to as food stamps.

Hayes believes more government red tape will lead to more needy families without the help they need to afford food. 

Following Thursday’s capitol hearing, opponents of the food stamp asset test delivered a petition with 10,000 signatures to Governor Tom Corbett’s office.   They say the new policy won’t save the commonwealth any money because food stamps are funded by the federal government, while state government shares the cost of administering the program.     

When Pennsylvania last had an asset test in 2008, the limits were $2,000 for households under the age of 60, and $3,250 for households with older or disabled individuals.  The asset test that’s set to take effect in May would increase those thresholds to $5,500 and $9,000 respectively. 

Assets subject to the test will include: cash, checking and savings accounts, as well as stocks, bonds and savings certificates.  Assets exempt from the test will include: homes, primary vehicles, educational savings accounts and all retirement plans. 

“This change is only expected to affect less than 1% of Pennsylvania’s population who are currently receiving the food stamp benefit,” Miller says.  As of December 2011, there were more than 1.8-million Pennsylvanians enrolled in the SNAP program.

Harrisburg's skyline

Rendell calls on Corbett to Reverse Proposed Asset Test for Food Stamps

Former Governor Ed Rendell has hand delivered a letter to the office of Governor Corbett, asking him to cancel plans to renew an asset test for food stamp recipientsAt a news conference on Wednesday, Rendell says the test that would   eliminate people from the Supplemental Nutrition Assistance Program based on their personal assets is unnecessary, since there’s already federally mandated means testing.

The Rendell administration ended asset testing in 2008.  The former governor says returning to the practice would not produce any savings and would hurt thousands of households.  Rendell says there’s no need for this test to get rid of fraud, waste and abuse, because Pennsylvania has one of the best accuracy rates of any state in the union.

Rendell says there wouldn’t be any savings, because the state would have to notify SNAP recipients of the change in policy and retrain all of the county assistance office staff. He says there’s also the economic impact, the loss of federal food stamp money that Pennsylvanians would no longer have to spend in grocery stores.

Rendell says he’s known Tom Corbett for a long time and believes him to be a good, decent man who cares about Pennsylvanians. He’s asking the Governor in good faith to take a look at the policy and reconsider.

Representative Michael Gerber (D-Montgomery) says families would  be forced to make tough decisions if this asset test is reinstated.  He calls it pennywise and pound foolish because any scarce savings would be far outweighed by any economic harm that it will do.

Kendall Hanna, of the Central PA Food Bank, says the asset test would make it nearly impossible for many people who have been recently laid off to obtain any help through the food stamp program.  He says a family would be penalized for saving money for medical emergencies or to repair their car to get to work.

Hanna says the asset test would drive thousands and thousands of people to food pantries and churches already stressed by a 40% increase in the number of people seeking food assistance just in the last four years.

Kevin Harley, spokesman for Governor Tom Corbett, says the number of people in Pennsylvania receiving food stamps nearly doubled while Governor Rendell was in office. He disputed claims the asset test would lead to more administrative costs.  He says when people would come in for renewals; they’d sit down with a caseworker who’d go over their assets.  

Harley says the Corbett administration wants to make sure that the people who truly need to receive food stamps can get them. He says the administration is still working on setting asset limits.

Harley also responded to concerns the state would lose millions in federal food stamp money due to the change.  He says that’s  saying Pennsylvania needs to generate more food stamps to have a poverty industry.  He says the Corbett administration is trying to create an economic environment where the private sector can grow and create more jobs, so that more people won’t need food stamps.

Critics Urge Administration to Reconsider Planned Food Stamp Asset Test

The Rendell administration did away with the state’s food stamp asset test in 2008.  Four years later, Governor Tom Corbett says restoring it would ensure food stamp dollars are used for those who truly need them.  “I think it’s incumbent if you are to get money from the government, than you should demonstrate your need for that,” Corbett said on Radio PA’s Ask the Governor program.

“I believe it’s incumbent for the people of Pennsylvania – those who are on welfare and those who are not on welfare – that we test for eligibility to make sure only those people who are eligible under the guidelines are entitled to get that.”

But an asset test would send the wrong message, according to Pennsylvania Hunger Action Center Interim Executive Director Laura Tobin Goddard.  “We know that having small savings, encouraging people to save, does help them to become self sufficient,” she says.

The proposed asset threshold for non-senior households would be $2,000.  Homes, retirement savings and first vehicles would be exempt.  Second vehicles would be exempt up to a value of $4,650.  Governor Corbett says there’s room for discussion about the thresholds, but their proposal simply returns to the asset test numbers that were in place in 2008.

The final decision rests with the US Department of Agriculture, which can either approve or reject the Department of Public Welfare’s request.  State House Democratic Leader Frank Dermody (D-Allegheny) has already written Ag Secretary Tom Vilsack, urging him to deny the administration’s request.

In part, that letter reads: “Despite the Corbett Administration’s assertions that reinstating the asset test will aid in Pennsylvania’s effort to root out “fraud, waste and abuse,” the fact is that few such problems exist with SNAP in Pennsylvania.  In fact, statistics show that Pennsylvania’s fraud rate in the program is among the lowest in the nation – a mere one-tenth of one percent.”

In a separate letter to Governor Corbett, Dermody urges him to reconsider the “ill-conceived” proposal.