President’s Budget Would Shift Substantial Costs to States and Cut Food Assistance for Millions

The unemployed, the elderly, and low-income working families with children would bear most of the brunt of the cuts.President Trump’s 2018 budget proposes to cut the Supplemental Nutrition Assistance Program (SNAP, formerly food stamps) by more than $193 billion over the next ten years — a more than 25 percent cut — through a massive cost shift to states, cutting eligibility for millions of households, and reducing benefits for hundreds of thousands more.^[1]  The unemployed, the elderly, and low-income working families with children would bear the brunt of the cuts.

Among other cuts to SNAP, the President’s budget would:

• Shift $116 billion in SNAP benefit costs to states. The President’s budget would require states to pay for 25 percent of SNAP benefits (starting at 10 percent in 2020 and increasing to an average state share of 25 percent by 2023), a cost shift of approximately $116 billion over ten years.  (See Table 1.)  Since its bipartisan origin, SNAP has operated as a national program with benefits paid by the federal government — a structure that was intended to address the enormous disparity in hunger and poverty across states.  Such a cost shift would have significant consequences for states’ budgets.  For example, in Texas, 25 percent of SNAP spending (about $1.3 billion per year) is roughly equivalent to the state’s share of the annual salary of 64,000 of the state’s teachers.   In Pennsylvania, 25 percent of SNAP spending (about $680 million per year) is more than twice what the state spends on community colleges.

• Abandon the national commitment to provide low-income Americans a SNAP benefit sufficient to afford a basic diet. SNAP benefits are now set federally and reflect the cost of a bare-bones healthy diet. As a part of the cost shift to states, the Agriculture Department would let states cut benefit levels as a cost management tool. This would mean that low-income families, seniors, and people with disabilities would no longer be guaranteed access to a basic diet regardless of where they live.  Instead, states’ ability to contribute to the cost of SNAP could drive the level of benefits available to poor households in that state. This is a radical departure from SNAP’s basic design, which has been proven to reduce hunger and poverty.

  The Administration’s savings estimate of this proposal doesn’t include any estimated impact of states reducing SNAP benefits.  Since states would feel pressure to cut benefits at some point, this proposal would likely cut SNAP even further.  Moreover, when the next recession hits, SNAP wouldn’t be able to expand automatically as it has in the past, as each additional dollar of SNAP necessary to meet the need of new applicants would require a state contribution at a time when state budgets would be strapped.

• Force states to time-limit food assistance to unemployed individuals who live in high-unemployment areas. SNAP law already restricts benefits to three months out of every 36-month period for individuals not raising minor children unless they are working 20 hours per week.  Though this provision is often called a “work requirement,” states are not obligated (and most do not) to provide a work slot that would allow these individuals to meet the 20-hour test.  The individuals affected by this rule are extremely poor,^[2] with average monthly income at 27 percent of the poverty line while on SNAP.  States can waive the time limit for areas that meet long-standing Labor Department standards for having persistently high unemployment.^[3]

  The President’s budget would restrict time limit waivers to areas with at least 10 percent unemployment.  In 2017, 36.4 percent of the country lives in the over 1,000 high-unemployment counties as well as numerous cities and reservations that are waived from the time limit.^[4] Under the budget, we estimate that only 54 counties of the areas currently waived would qualify, representing just 1.3 percent of the country.  The proposal would mean that 1 million poor unemployed individuals would no longer have access to food assistance in an average month.  The areas that would no longer qualify for waivers include high-unemployment and economically hard hit areas such as southern Alaska, the Navajo Nation in Arizona, parts of California’s Central Valley, and areas within Appalachia.  Hundreds of thousands of very poor unemployed individuals would lose food assistance after just three months immediately if this provision were enacted, and the effects would swell during future recessions. (See Table 2.)

• Eliminate a state option that supports working families and addresses a benefit cliff.  SNAP includes a state option that allows states to raise SNAP’s gross income eligibility cut-off of 130 percent of the poverty line ($2,200 per month for a family of three) to a higher level. Through this option, 31 states are providing modest food assistance benefits to working poor families who are paying a relatively large share of their income in rent and/or child care and as a result have too little left to afford a healthy diet.  The President’s budget would eliminate the option, which provides food assistance to an estimated 1 million households in an average month.  (See Table 2.)  Some 90 percent of this option’s benefits go to working households.

  This option also permits states to ease the federal asset limit, thereby allowing households with savings of more than the federal limit of $2,250 (or $3,250 for households with an elderly or disabled member) to participate.  More than 40 states have used this flexibility to remove the savings disincentive in SNAP and to eliminate the complexity and error the federal asset limit causes.

• Cut benefits to the elderly and people with disabilities. The budget proposes to terminate SNAP’s minimum monthly benefit of $16 for households of one or two people, which primarily goes to low-income seniors and people with disabilities who qualify for a benefit of $15 or less.  Almost 2 million people would lose SNAP benefits as a result of this provision.  (See Table 3.)
• Penalize large families. SNAP benefits are scaled to reflect household size. Larger families with the same income as a small family qualify for more benefits to help them meet their greater food needs.  The President’s budget would cap additional benefits based on household size at families of six, cutting benefits to many families with several children or who live with grandparents and other family members.  This proposal would cut approximately $180 million in benefits each year to about 80,000 larger households.  In effect, this proposal would eliminate benefits to the 170,000 “extra” people who live in many households larger than six people.

SNAP is a highly effective program targeted to households that need its help to meet their basic food needs.  With a small average benefit of just $1.40 per person per meal, it lifts millions out of poverty, and it has demonstrated long-term benefits for children that participate, including better health and education outcomes.  While its overall enrollment and spending are coming down as the economy improves,^[5] it provides vital assistance to over 40 million low-income Americans.

These proposed cuts to food benefits for low-income unemployed, seniors, and families with children are in addition to another $2 trillion in proposed cuts to programs that help low- and moderate-income households make ends meet and access needed health care.  And, at the same time it proposes these deep cuts to the safety net, the budget proposes massive tax cuts for the wealthy.  As CBPP’s Bob Greenstein notes, this budget would make us “a coarser nation, making life harder for most of those struggling to get by but more luxurious for those at the very top.”^[6]