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This final rule implements sections 4009 and 4011 of the 2018 Farm Bill, which amended the Food and Nutrition Act to require the establishment of an interstate data system, to be known as the National Accuracy Clearinghouse (NAC), that State agencies will use to prevent multiple issuances of SNAP benefits to an individual by more than one State agency simultaneously. States agencies are also required to pursue clarification and verification, if applicable, on information received from NAC data matches. This final rule also implements section 4013 of the Agricultural Act of 2014, which requires States to verify applicant wage data through the National Directory of New Hires (NDNH) for the determination of eligibility and correct amount of benefits at the time of certification.

Statement of Need:

The United States Department of Agriculture (the Department) is publishing this final rule to implement Section 4011 of the Agriculture Improvement Act of 2018 (the 2018 Farm Bill). This provision authorizes the Secretary of Agriculture to establish the National Accuracy Clearinghouse (NAC) and to require State agencies to provide information to the NAC and take appropriate action with respect to each positive NAC data match in order to prevent multiple issuances of SNAP benefits to an individual in the same month. Current SNAP regulations already require States to establish systems to prevent individuals from participating in more than one household within one State (duplicate participation). The rules stipulate that States match applicant names, social security numbers, and birth dates against their existing caseloads. The NAC data matching system will effectively extend States’ efforts to prevent duplicate participation to include duplicate participation across State lines. This final rule makes participation in the NAC a requirement for State agencies and establishes consistent parameters for its use. Pursuant to section 4013 of the Agricultural Act of 2014, this final rule also requires that State agencies access employment data through the NDNH at the time of SNAP certification, including recertification, and aims to improve Program integrity by reducing the risk of improper payments due to unreported or misreported income.

Summary of the Legal Basis:

Sections 4009 and 4011 of the 2018 Farm Bill amended the Food and Nutrition Act to require the establishment of an interstate data system, to be known as the National Accuracy Clearinghouse (NAC), that State agencies will use to prevent multiple issuances of SNAP benefits to an individual by more than one State agency simultaneously and pursue clarification and verification, if applicable, on information received from NAC data matches. Section 4013 of the 2014 Farm Bill amended the Food and Nutrition Act to require States to verify applicant wage data through the National Directory of New Hires (NDNH) for the determination of eligibility and correct amount of benefits at the time of certification. Pursuant to section 4013 of the Agricultural Act of 2014, this final rule also requires that State agencies access employment data through the
NDNH at the time of SNAP certification, including recertification, and aims to improve Program integrity by reducing the risk of improper payments due to
unreported or misreported income.

Alternatives:

The language in Sections 4009 and 4011 of the Agriculture Improvement Act of 2018 is very specific; therefore, no alternatives were considered for this rule.

Anticipated Costs and Benefits:

The Department has estimated the net reduction in Federal SNAP spending associated with the final rule to be approximately $165 million over the five years 2021-2025. This reduction in spending represents a decrease in federal transfers (SNAP benefit payments) of nearly $192 million over five years, due to prevention of duplicate participation, partially offset by increases in federal systems costs related to implementing, operating, and maintaining the system ($13 million) and in the federal share of State administrative costs (nearly $14 million). In addition, the Department estimates an increase in the State share of administrative costs (nearly $14 million over five years) for start-up costs and costs associated with submitting data and following up on matches. In future years, as more States implement NAC, the reduction in federal spending is expected to increase. This rule will also increase administrative burden on SNAP households by nearly $1 million over five years. Households identified as potential duplicate participants through NAC matches will need to provide verification and respond to notices and requests for information from State Agencies.

Risks:

N/A