Austerity fever strikes again! And putting the nation on a "pay as you go" footing means that programs that actually help poor people are most vulnerable, as in this case:
A little-noticed change in federal law may hurt small neighborhood grocery stores and their low-income customers who use food stamps.
In 2004, food stamps went digital, switching from paper coupons to electronic cards. In large supermarkets, such Electronic Benefit Transfer (EBT) cards are swiped at checkout terminals along with credit and debit cards.
But in around 118,000 bodegas, corner stores, and mom-and-pop markets nationwide, EBT cards have been used in specific EBT machines provided to stores free in a federal-state partnership, according to the U.S. Department of Agriculture, which administers the food-stamp program, known as SNAP.
Now, all that is changing. The states and the federal government will no longer foot the bill for EBT machines, a measure that could save an estimated $154 million over 10 years, according to federal officials.
Beginning as early as this week, stores will be charged around $1,000 or possibly more a year to use EBT equipment, supplies, and related services, according to Xerox Corp., which administers EBT card programs in 19 states, including Pennsylvania and New Jersey.
For small retailers living on razor-thin margins, that could be a great deal of money, antihunger advocates say.
As a result, advocates fear, stores may either raise prices or decide not to accept EBT cards, a problem that would ultimately land on low-income people dependent on SNAP. Most SNAP recipients are children, the disabled, and the elderly.
"If they charge me that much, I don't think it's worth it for us to accept food stamps anymore," said Gino DiMarco, owner of the Roman Pantry, a small grocery and deli in Carneys Point, Salem County.
Vinod Patel, who runs a small store in Camden named Lou's, was unhappy with the change. "It'll be way more than $1,000 a year," he said.
Patel added he would not stop accepting SNAP, because so many customers use it.↓ Story continues below ↓
But, he added, "I may have to raise the prices" to compensate.
The EBT change was made in the federal farm bill, in which Congress sets spending on SNAP. The bill, which cut $8.6 billion in food stamps from 850,000 U.S. households over the next decade, became law in February.
Though the cut to SNAP was big news, few people noticed what was happening to the EBT machines.
"I'm most upset," said Jessica Bartholow, legislative advocate with the Western Center on Law and Poverty, a Los Angeles legal services nonprofit that helps low-income people.
"A careless policy change without full vetting will cause so many ripples," said Bartholow, an expert on SNAP, "and there will be people trying to get food who won't be able to.
"Congress didn't even hold a hearing to ask how this impacts stores and low-income people. It's abhorrent, disgraceful, and embarrassing."
A staff member of the House Agriculture Committee who did not want to be named called people's ire over the EBT change "baffling," saying it "never drew any objections from anyone until now."
That's because "no one realized how big a problem it would be," said Patricia Baker, senior policy analyst at the Massachusetts Law Reform Institute, a nonprofit working to advance social justice.