Quick Hit Ellyn Fortino Thursday January 9th, 2014, 4:29pm

Report Highlights SNAP Reform Proposals Meant To Reduce Hunger, Promote Nutrition

The Supplemental Nutrition Assistance Program (SNAP) is a crucial anti-hunger and anti-poverty tool, but a handful of reforms are needed to boost the program's overall effectiveness, argues Diane Whitmore Schanzenbach, an associate professor at Northwestern University's School of Education and Social Policy.

About one in eight U.S. families depend on SNAP benefits, at about $1.40 per meal, for food aid. More than 2 million people in Illinois rely on the $80-billion-a-year program, which has helped to reduce hunger and rates of food insecurity in the country, while also providing support to families who face unexpected economic setbacks.

In a recent discussion paper for the Hamilton Project, Schanzenbach noted that despite the program's successes, obesity rates in the nation are still high, the method of determining food aid benefits is outdated and SNAP coverage during economic recessions needs to be improved.

SNAP has been in the spotlight recently after benefits were cut this fall due to the expiration of a temporary food-aid increase as part of the 2009 American Reinvestment and Recovery Act.

Federal proposals are looking to trim the program further. In September, for example, the House approved the Nutrition Reform and Work Opportunity Act, which would slash SNAP benefits by $39 billion over a 10-year period. That's almost double the original $20 billion which House Republicans attempted to cut from SNAP back in July. Some three million people a year on average would likely lose their SNAP benefits if the House Republicans' current proposal takes effect, the Congressional Budget Office (CBO) estimates. The Senate has also proposed to scale down SNAP by a comparatively modest $4 billion over a decade as part of its 2013 Farm Bill, which was approved in early June.

In the paper, Schanzenbach urged federal lawmakers to keep SNAP's current funding levels intact, but she also provided ways in which to strengthen the program to help create a more "food-secure, healthy America."

Her first proposal includes a rebate for every $1.00 a SNAP recipient spends on certain fruits and vegetables in an effort to reduce the price of fresh produce and promote healthy eating. Schanzenbach said this incentive scheme could be based on the successful Healthy Incentives Pilot (HIP) program in Massachusetts, which provided SNAP recipients with a $0.30 rebate for every $1.00 spent on various fruits and vegetables. The program, which ran through November 2011 to the end of December 2012, resulted in a 25 percent increase in the consumption of the targeted healthy foods.

If adopted, this SNAP incentive program would cost the federal government $824 million per year, according to calculations based on the HIP program and CBO's participation estimates. Under this type of proposal, the average total rebate payment per year to SNAP recipients would be about $45.

"It would be hard to imagine that this Congress right now would be in favor of expanding this program, which is too bad, because we do have evidence that it works," Schanzenbach said during a December interview about SNAP on WBEZ's Afternoon Shift.

Another study Schanzenbach recently authored, in partnership with the Federal Reserve Bank of Chicago, also showed that those receiving government aid purchase healthy foods when their buying power is expanded. The new research focused on the Earned Income Tax Credit and how it impacts the food consumption patterns of eligible households. Contrary to popular belief, the report found that "eligible households spend relatively more on healthy items including fresh fruit and vegetables, meat and poultry, and dairy products during the months when most refunds are paid."

In her paper for the Hamilton Project, Schanzenbach explained that the SNAP benefit formula overall needs to be modified in order to better estimate the amount of food aid that families require. SNAP benefits are calculated in part by a diet cost that assumes recipients are cooking their meals from scratch, which is not as common today compared to previous decades, the report noted. Schanzenbach argues that the formula should be tweaked to reflect that change.

Net income is another factor used to determine SNAP benefits. The program's earned income deduction, for example, allows households to deduct 20 percent from their earnings when calculating net income to help balance the extra costs associated with working, such as transportation. The problem is that the 20 percent deduction is usually not large enough to offset today's increased work costs, the report reads.

Instead, the earned income tax deduction should be increased to 30 percent, Schanzenbach said, "in order to more aggressively limit disincentives for work." According to the report, this change would increase the program's overall annual costs by $2.7 billion, but it would boost the average spending for SNAP recipients by $40.

"This change would increase the work incentive among SNAP recipients and improve the purchasing power of working families," the report reads. "By inducing low-income job seekers to engage in employment, SNAP can help ensure that recipients continue to develop valuable skills through training, making them less likely to have to rely on benefits in the future."

Meanwhile, Schanzenbach said current state-level waivers need to be preserved that allow able-bodied adults without dependents (ABAWDs) to obtain SNAP benefits during times of high unemployment. No additional resources would be needed to keep these existing safeguards in place, the report noted.

ABAWDs can obtain SNAP benefits for up to three months every three years if they are not working or participating in a job training program. A good chunk of the savings in the House Republicans' recent SNAP proposal would come from eliminating the waivers that allow childless adults aged 18 to 50 to stay in the the program if they are unable to find at least a part-time job after three months of receiving benefits.

But Schanzenbach argues that childless, able-bodied adults should be able to receive SNAP benefits up to six months every year, which would cost the program less than $2 billion annually, according to CBO estimations.

The increased costs are justified, Schanzenbach said, because the current time limit "does not provide a sufficient window for many low-skilled job seekers to find employment."

"Relaxing the restriction on ABAWD benefits will allow job seekers and undertrained adults to receive better access to a nutritious diet, while limiting incentives for job seekers to remain unemployed for longer durations," she wrote.

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