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USDA/FNS RIN: 0584-AE62 Publication ID: Fall 2019 
Title: Revision of Categorical Eligibility in the Supplemental Nutrition Assistance Program (SNAP)  
Abstract:

Under section 5(a) of the Food and Nutrition Act of 2008, households in which all members receive benefits under a State program funded by the Temporary Assistance to Needy Families (TANF) program are categorically eligible to participate in the Supplemental Nutrition Assistance Program (SNAP). This proposal would change the regulations at 7 CFR 273.2(j)(2) pertaining to categorically eligible TANF households by limiting categorical eligibility to households that receive cash TANF or other substantial assistance from TANF. Categorical eligibility conferred by any non-cash assistance would be limited to substantial ongoing assistance or services, such as child care, that have an eligibility determination process similar to cash TANF. This rule would not alter categorical eligibility for Supplemental Security Income (SSI) households or General Assistance (GA) households.

 
Agency: Department of Agriculture(USDA)  Priority: Economically Significant 
RIN Status: Previously published in the Unified Agenda Agenda Stage of Rulemaking: Proposed Rule Stage 
Major: Yes  Unfunded Mandates: State, local, or tribal governments 
EO 13771 Designation: Regulatory 
CFR Citation: 7 CFR 273.2(j)(2)   
Legal Authority: 42 U.S.C. 601    Pub. L. 113-79   
Legal Deadline:  None

Statement of Need:

This proposal would change current regulations by limiting categorical eligibility to households that receive cash assistance or other ongoing or substantial assistance from TANF, such as child care, and that have an eligibility determination process similar to cash TANF. These stricter requirements would ensure that categorical eligibility is appropriately targeted toward low-income households most in need while maintaining administrative streamlining across Federal benefits programs. 

Summary of the Legal Basis:

Section 5 (a) of the Food and Nutrition Act of 2008.

Alternatives:

(1) No change to current regulations retain the scope of existing expanded categorical eligibility;

(2) Finalizing as proposed;

(3) Income limit set at 130% of the Federal poverty guidelines; no resource test

(4) Income limit set at 185% of the Federal poverty guidelines; no resource test

(5) Resource test only (SNAP Federal limits); assume all non-cash programs qualify

(6) Modifying proposal based on priorities identified and comments provided during public review.

Anticipated Costs and Benefits:

The Department has estimated the net reduction in Federal spending associated with the proposed rule to be approximately $9.4 billion over the five years 2019-2023.  Included in this is an estimated reduction in Federal transfers of approximately $10.543 billion over the five-year period as well as a $1.157 billion increase in Federal administrative costs.  The Department estimates an additional $1.157 billion in administrative costs to State agencies (for a total of $2.314 billion in additional administrative costs).  The Department estimates that approximately 9 percent of currently-participating SNAP households will lose eligibility for SNAP because their incomes or resources exceed Federal SNAP eligibility standards (an estimated 1.7 million households in FY 2020, containing 3.1 million individuals).  In addition, the Department estimates that households that remain eligible for SNAP (approximately 17.2 million households containing 34.7 million individuals) and new SNAP applicants will face additional burden associated with the application process, at a cost of approximately $5 million annually.  We would expect that the changes in the final rule to be roughly at that order of magnitude, but a precise estimate is pending final policy decisions.

The projected benefit of the rule is to create a more consistent nationwide policy that limits categorical eligibility to households that have sufficiently demonstrated need by qualifying for ongoing and substantial benefits from TANF-funded programs designed to assist low-income households and help them move towards self-sufficiency.  In addition, the revisions would help ensure that receipt of nominal, one-time benefits (such as a brochure) does not confer categorical eligibility.

Risks:

As noted above, the purpose of the rule is to create a more consistent nationwide policy that limits categorical eligibility to households that have sufficiently demonstrated need by qualifying for ongoing and substantial benefits from TANF-funded programs designed to assist low-income households and help them move towards self-sufficiency.  If not pursued, there is a risk that these benefits would not be realized.

Timetable:
Action Date FR Cite
NPRM  07/24/2019  84 FR 35570   
NPRM Comment Period End  09/23/2019 
NPRM Comment Period Reopened  10/18/2019  84 FR 55870   
NPRM Comment Period Reopen End  11/01/2019 
Final Action  05/00/2020 
Regulatory Flexibility Analysis Required: No  Government Levels Affected: Federal, Local, State 
Small Entities Affected: Governmental Jurisdictions  Federalism: No 
Included in the Regulatory Plan: Yes 
RIN Data Printed in the FR: No 
Agency Contact:
Charles H. Watford
Regulatory Review Specialist
Department of Agriculture
Food and Nutrition Service
3101 Park Center Drive,
Alexandria, VA 22302
Phone:703 605-0800
Email: charles.watford@fns.usda.gov

Kelly Stewart
Chief, Planning and Regulatory Affairs Office
Department of Agriculture
Food and Nutrition Service
3101 Park Center Drive,
Alexandria, VA 22302
Phone:703 305-2425
Email: kelly.stewart@fns.usda.gov