BEYOND THE NUMBERS
The Coronavirus Aid, Relief, and Economic Security (CARES) Act, which President Trump is expected to sign soon, doesn’t expand benefits or eligibility under SNAP (food stamps). Policymakers must address this limitation in their next stimulus measure, both to help the growing number of families struggling to afford food in the pandemic and because SNAP is one of the fastest, most effective forms of economic stimulus.
Among other steps to address this crisis, we recommend that the President and Congress raise maximum SNAP benefits and suspend the program’s three-month time limit on benefits for jobless adults who aren’t raising children in their homes. The SNAP provisions enacted so far, which include a temporary suspension of the time limit, are in effect only for when the public health emergency is in effect — they very likely would end before the economy recovers — and leave out nearly 40 percent of SNAP households.
Some confusion has arisen because the CARES Act would raise the SNAP appropriation by $15.8 billion. But rather than expand eligibility or increase benefits, that appropriation is a technical fix to ensure that the government can pay for existing benefits — a needed step because SNAP is an “appropriated entitlement” that has no permanent direct funding. The regular SNAP appropriation for this year is capped, so the CARES Act’s $15.8 billion appropriation is meant to cover the rise in SNAP caseloads under the regular program, which is expected due to the economic downturn, as well as to cover the recently enacted Families First Coronavirus Response Act, which didn’t include an appropriation for its short-term SNAP benefit increases during the public health emergency period. (The CARES Act provides a similar $8.8 billion appropriation for the Child Nutrition programs.)
The SNAP provisions of the Families First Coronavirus Response Act, which the President signed into law on March 18, were intended to respond to the short-term effect of the health emergency, and not the broader, likely longer-term economic crisis. The Agriculture Department so far has granted states only two months of the Act’s additional benefits, for March and April. And it has interpreted the law in a way that leaves out SNAP benefit increases for nearly 40 percent of SNAP households — those who already receive the maximum SNAP monthly benefit and are the SNAP households with the lowest incomes.
We and many economists and policymakers recommend raising SNAP benefits and modestly expanding eligibility to address the effects of COVID-19 until the economy shows solid signs of recovering from the downturn. Unfortunately, the CARES Act doesn’t include these changes, despite many policymakers’ efforts. As a result, we continue to recommend that the next stimulus package include a 15 percent increase in the SNAP maximum allotment level (the Thrifty Food Plan, or TFP). That’s about another $25 per person per month, or just under $100 per month in food assistance for a family of four. At a cost of a little over $5 billion for the rest of fiscal year 2020 when accounting for the likely rise in household SNAP eligibility, the provision would give key assistance to struggling families — including substantial shares of SNAP households for whom Families First doesn’t raise benefits — while helping boost the economy.
We also recommend further suspending SNAP’s three-month time limit, which applies to certain childless adults who aren’t working or participating in job training for a certain amount of time per month — a near impossibility for many if entire sectors of the economy remain shuttered. Families First suspends the limit but only during the immediate public health emergency. The effects of the economic slowdown on labor-market opportunities for workers in low-wage occupations will likely last longer, so the suspension should stay in effect until the economy improves.
In addition, policymakers should suspend finalizing or implementing three regulations that the Administration is pursuing that would end SNAP benefits for 3 to 4 million people and shrink them for about 6 to 7 million others. Such changes are ill-advised in a normal economy, and contracting SNAP eligibility during a downturn runs counter to the goal of boosting economic demand. Finally, we recommend additional federal funding for state SNAP administration to help accommodate the costs of meeting the rising demand for services.
We’re at serious risk of a sharp economic decline, and SNAP is one of the most effective mechanisms both to help low-income families afford food and to provide counter-cyclical help in a recession, thereby boosting the economy. SNAP gets money into the economy very quickly, partly because people with low incomes generally spend all of their income meeting immediate, daily needs such as shelter, food, and transportation. Some 80 percent of SNAP benefits are redeemed within two weeks of receipt; 97 percent are spent within a month. The Congressional Budget Office and Moody’s Analytics rate SNAP spending as one of the most effective supports for the economy during downturns. But most importantly, we must protect families’ ability to afford nutritious food in an unprecedented public health emergency and time of economic shock.