Senior Policy Analyst on Puerto Rico
Nearly 1.5 million Puerto Rico residents, including more than 300,000 children, are facing deep cuts in food assistance in August, but the new Senate Republican economic relief plan doesn’t include more food aid for Puerto Rico. While the House-passed Heroes Act includes a modest increase in nutrition funding for Puerto Rico, it falls short of Governor Wanda Vázquez Garced’s request. Without sufficient additional food aid, more than a million U.S. citizens in Puerto Rico will face these food assistance losses while also grappling with COVID-19 and its severe economic impact.
As explained below, the Commonwealth will soon run out of emergency nutrition assistance that the President and Congress have provided. Food insecurity in Puerto Rico, however, was already high before the pandemic, and food need has only worsened due to COVID-19-related increases in unemployment and mandated school closures. As many as one-third of adults in Puerto Rico struggled to afford adequate food in 2015, research from the Puerto Rico Institute of Statistics shows.
Making matters worse, policymakers inadvertently left the Commonwealth out of the Pandemic EBT program, enacted in March, which is providing additional food aid to school-aged children across the nation who are missing free and reduced-price meals due to school closures. (Puerto Rico participates in the federal school meals programs.) As a result, close to 300,000 children in Puerto Rico’s public schools can’t access the P-EBT benefits that states can provide to help families cover those costs.
While Puerto Rico’s COVID-19 cases have remained relatively low in number when compared to other parts of the country, the pandemic has severely damaged its economy. The Bureau of Labor Statistics last updated Puerto Rico’s unemployment rate in February, but other indicators suggest that unemployment has dramatically spiked over the last four months. Currently, Puerto Rico’s insured unemployment rate — the share of the labor force that’s receiving unemployment benefits — is the nation’s highest, rising from about 2 percent in late February to 26 percent on July 4, according to Labor Department data. More than 300,000 residents — roughly a third of Puerto Rico’s civilian labor force — have filed pandemic-related unemployment claims. And Puerto Rico’s federally mandated Oversight Board projected in its latest fiscal plan, which it certified in late May, that unemployment would climb as high as 38 percent in June.
Compounding the suffering are other crises that have befallen Puerto Rico recently. Unlike other parts of the country, Puerto Rico entered this pandemic after more than a decade of economic decline coupled with hurricanes, earthquakes, and an unprecedented, ongoing bankruptcy process. Moreover, Puerto Rico residents in many instances have limited or no access to the nation’s safety net, further exacerbating hardship.
Under ordinary circumstances, Puerto Rico’s Nutrition Assistance Program (NAP), its version of SNAP (food stamps), offers many beneficiaries lesser benefits than they would receive under SNAP. That’s due to NAP’s rigid financing structure: a capped amount (or block grant) of about $2 billion a year to provide food assistance to very poor households. The Commonwealth must set eligibility and benefits to stay within this funding level, hampering its ability to consistently provide benefits that meet participants’ nutritional needs.
SNAP, by contrast, provides benefits to all eligible residents, so its budget expands and contracts automatically to meet changing needs. It operates in all 50 states and in the U.S. Virgin Islands and Guam. Indeed, the number of SNAP participants grew by 17 percent, or more than 6 million people, from February to May.
With its block grant structure, NAP cannot automatically expand to serve more people to meet rising need, whether from natural disasters or economic downturns. Instead, Puerto Rico must rely on the President and Congress to provide additional money and, as a result, much-needed aid is sometimes severely delayed, shortchanged, or both.
Over the past three years, policymakers have provided additional funding to help NAP address the devastating effects of hurricanes Irma and Maria in 2017, and more recently COVID-19. That has enabled Puerto Rico to increase benefits — in many cases matching SNAP levels — to help NAP participants better afford food, given their loss of income from these crises, and enroll more low-income beneficiaries needing assistance, including a significant number in recent months who were affected by the COVID-19 crisis.
But the additional funding will run out in August, risking steep benefit cuts for all NAP participants or even a complete benefit loss for some, as funding reverts to regular block grant levels. Puerto Rico’s governor has repeatedly written to Congress to warn about the impending “August cliff” and request additional assistance. In her most recent letter to congressional leaders, in which she requested an additional $1.24 billion, the governor warned that once the funds run out in August, Puerto Rico will have to impose deep cuts to stay within funding limits.
In light of Puerto Rico’s dire circumstances and the complicated recovery road that lies ahead, policymakers should prioritize a boost in nutrition funding for Puerto Rico in the next economic relief package.