GAO says expanded food stamp eligibility raises costs, chances of abuse

GAO found that eligibility for SNAP has more than doubled in the last decade, which its costs have nearly quadrupled. And while GAO said the recent recession has contributed to increased eligibility and increased costs for the program, the ability of states to expand eligibility for the program is also a significant factor.

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More specifically, the report found that broad-based categorial eligibility (BBCE) has allowed nearly all states to expand eligibility for food stamps. BBCE was a policy that the U.S. Department of Agriculture adopted in 1999, and it let states deem people eligible for SNAP if they receive any assistance from the Temporary Assistance for Needy Families (TANF) program. These services can be as simple as using a toll-free number or receiving a government brochure.

BBCE is also used by states to raise the income levels below which SNAP benefits can be applied for and received, and allow people to skip some income tests for eligibility.

Before BBCE, applicants had to have a gross income of below 130 percent of the poverty level, a net income of less than 100 percent of the poverty level, and less than $2,000 in assets. But under BBCE, families can receive SNAP benefits if their gross income is 200 percent of the poverty level, and they are not scrutinized for net income and assets.

Aside from expanding SNAP eligibility and costs, GAO warned that BBCE also appears to be leading to increased waste in the program.

"Although BBCE has been promoted by USDA as a possible means to reduce errors, we found that a greater percentage of SNAP households eligible under BBCE that had incomes over the federal limits had errors than other households (17.2 percent compared to 6.7 percent) in fiscal year 2010," GAO said.

The report also said fraud could rise because SNAP caseworkers no longer look to verify net income and total assets before granting eligibility. "Specifically, while asset verification often took considerable time to perform, they noted that previously reviewing bank accounts game that the ability to identify regular deposits that may be income to ensure those were reported by the applicant," the report said.

And while SNAP eligibility can be granted upon receipt of a modest service under TANF, such as receipt of a brochure, states also do not appear to be checking whether even these simple steps take place before allowing eligibility for the program. "As a result, in a state where a document, such as a brochure, is used to confer eligibility, the state does not have to verify that it has provided the document to applicants as part of the eligibility determination process," it said.

For this last reason, GAO suggested that USDA review state procedures to be sure TANF services are first being provided before people are found to be eligible for food stamps.

GAO also added that under BBCE, some children may be qualifying for free school lunches, and suggested that USDA issue guidance to help eliminate this problem.

And finally, the report said USDA should issue guidance requiring people to report changes in income levels, so that people with a sudden increase in income cannot continue to receive SNAP benefits.