oversight

Food Stamp Program: Various Factors Have Led to Declining Participation

Published by the Government Accountability Office on 1999-07-02.

Below is a raw (and likely hideous) rendition of the original report. (PDF)

                  United States General Accounting Office

GAO               Report to Congressional Requesters




July 1999
                  FOOD STAMP
                  PROGRAM
                  Various Factors Have
                  Led to Declining
                  Participation




GAO/RCED-99-185
      United States
GAO   General Accounting Office
      Washington, D.C. 20548

      Resources, Community, and
      Economic Development Division

      B-282728

      July 2, 1999

      The Honorable William J. Coyne
      Ranking Minority Member
      Subcommittee on Oversight
      Committee on Ways and Means
      House of Representatives

      The Honorable Sander M. Levin
      Ranking Minority Member
      Subcommittee on Trade
      Committee on Ways and Means
      House of Representatives

      Participation in the Food Stamp Program, the nation’s largest food
      assistance program, has dropped by 27 percent during the past 3-1/2 years.
      The monthly average number of low-income participants declined from
      25.5 million in fiscal year 1996 to about 18.5 million in the first half of fiscal
      year 1999. The U.S. Department of Agriculture (USDA) estimates that
      participation has declined at about the same rate for children, who
      represent about half of the food stamp rolls. The Personal Responsibility
      and Work Opportunity Reconciliation Act of 1996, commonly known as
      the Welfare Reform Act, changed welfare from an entitlement program to
      one designed to end needy parents’ dependence on government aid by
      promoting employment. Accordingly, the act gave the states flexibility, for
      example, to require applicants to look for work as a condition of eligibility
      for welfare benefits. The act retained the Food Stamp Program as an
      entitlement program for qualifying participants, but it tightened the
      program’s eligibility standards by establishing work requirements for
      able-bodied adults without dependents and by disqualifying most
      permanent resident aliens from participating in the program.

      Because of concerns that states’ efforts to reduce their welfare caseloads
      may have diminished eligible children’s participation in the Food Stamp
      Program, you asked us to examine (1) the reasons for the recent drop in
      food stamp participation and (2) any problems that households with
      eligible children have experienced in obtaining food stamps. To assess
      these concerns, we analyzed the responses to a questionnaire we sent the
      50 states and the District of Columbia; obtained data and reports on food
      stamp participation from the Food and Nutrition Service within USDA; and
      surveyed each of the Food and Nutrition Service’s seven regional offices,




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                   which oversee state and local governments’ implementation of the
                   program.


                   The strong U.S. economy, tighter food stamp eligibility requirements, and
Results in Brief   welfare reform initiatives are the primary reasons for the decline in food
                   stamp participation. According to the states, participation has dropped
                   mainly because fewer people are eligible to receive food stamps—a result
                   of the strong economy and changes in food stamp eligibility. However,
                   most states also believe that welfare reform initiatives designed to reduce
                   the welfare rolls have helped to lower food stamp participation. Children
                   accounted for about 48 percent of the total decline in participation in
                   fiscal year 1997, the most recent year for which detailed data are available.
                   Moreover, children’s participation in the Food Stamp Program has
                   dropped more sharply than the number of children living in poverty,
                   indicating a growing gap between need and assistance.

                   Some households, including those with eligible children, have had
                   problems obtaining food stamps because some state and local
                   governments have gone farther than the law permits in limiting benefits.
                   Believing that welfare families need to become self-reliant and break their
                   dependence on government assistance, these state and local governments
                   have taken steps that USDA has subsequently found to be excessive. For
                   example, New York City emphasized job searches during applicants’ first
                   visits without permitting households to apply for food stamps—a
                   procedure that USDA determined was a violation of food stamp law and a
                   federal court, in effect, barred by granting a preliminary injunction in an
                   ongoing court case. Similarly, Michigan denied food stamp benefits to
                   whole households rather than to individual members of households when
                   these members had violated welfare requirements—a procedure that a
                   federal court ruled was illegal. In addition, many former welfare recipients
                   do not receive food stamp benefits because several state and local
                   governments have not publicized differences in the eligibility requirements
                   for welfare and food stamps. The states’ actions occurred, in part, because
                   USDA has not promulgated regulations for implementing revisions to the
                   Food Stamp Program enacted almost 3 years ago. Furthermore, USDA’s
                   Food and Nutrition Service has not reviewed potential participants’ access
                   to food stamp benefits in 10 states since the beginning of fiscal year 1997.
                   We offer recommendations to USDA to correct these inequities in the
                   program.




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             The Food Stamp Program helps low-income individuals and families
Background   obtain a more nutritious diet by supplementing their income with food
             stamp benefits. USDA’s Food and Nutrition Service (FNS) and the states
             jointly implement the Food Stamp Program. FNS promulgates regulations
             for implementing the Food Stamp Program, reviews states’ operating plans
             to ensure compliance with the regulations, and pays the full cost of the
             food stamp benefits and about half of the states’ administrative costs. The
             states administer the program by determining whether households meet
             the program’s income and asset requirements, calculating monthly
             benefits for qualified households, and issuing benefits to participants.
             Almost all of the states use a single application for the Food Stamp and
             welfare programs to reduce administrative costs, even though the
             eligibility rules for these two programs are different.

             In fiscal year 1998, the Food Stamp Program provided about $16.9 billion
             in benefits, or an average of $170 per participating household per month.1
             A household’s monthly food stamp benefit depends on the household’s
             income, assets, and number of qualified members. Eligibility for food
             stamps is based on the Department of Health and Human Services’ poverty
             guideline: A household’s gross income cannot exceed 130 percent of the
             guideline (about $1,800 per month for a family of four living in the
             contiguous United States), and its net income cannot exceed 100 percent
             of the guideline (about $1,400 per month for a family of four living in the
             contiguous United States). In addition, a household is limited to $2,000 in
             countable resources, plus a vehicle worth no more than $4,650. (Eligibility
             requirements are less stringent for households with elderly or disabled
             members.) The states generally require food stamp households to have
             their eligibility recertified every 3 to 12 months.

             The Welfare Reform Act (P.L. 104-193, Aug. 22, 1996) reformed the nation’s
             welfare program and modified aspects of the Food Stamp Program. To
             reform welfare, the act replaced the Aid to Families with Dependent
             Children (AFDC) program with the Temporary Assistance for Needy
             Families (TANF) program and gave the states responsibility for
             administering TANF with block grant funding. The act set a lifetime limit of
             5 years on the receipt of TANF benefits and established financial penalties
             for states that fail to ensure that a specified minimum percentage of their
             welfare households work or participate in work-related activities each
             year. In implementing welfare reform, the states have used the act’s
             flexibility to (1) require that applicants look for jobs before their TANF

             1
              A household consists of individuals who live together and customarily purchase and prepare food in
             common.



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applications are processed; (2) require that TANF recipients attend training
sessions and search for work as a basis for continuing to receive benefits;
(3) offer onetime, lump-sum payments (known as diversion payments) to
potential applicants rather than enroll them in the TANF program; and
(4) disqualify individuals from participation in the Food Stamp Program
for TANF violations, thereby reducing the household’s total food stamp
benefit.2

The act also tightened food stamp eligibility requirements and eased
administrative requirements. It disqualified able-bodied adults without
dependents who, during the preceding 36-month period, received food
stamp benefits for at least 3 months but worked less than 20 hours per
week.3 Similarly, the act required that the states, by August 1997, remove
from their rolls most permanent resident aliens who were previously
eligible to receive food stamps.4 In addition, the act replaced several
specific administrative requirements with more general standards that give
the states more flexibility in operating their food stamp programs.

Historically, participation in the Food Stamp Program has tracked U.S.
business cycles: Food stamp participation has grown as the economy has
slowed and declined as the economy has expanded. However, particularly
since 1996, food stamp participation has dropped faster than related
economic indicators would predict. Figure 1 shows that food stamp
participation, unemployment, and the number of people living in poverty
rose during the recession in the late 1980s and early 1990s. Since then,
food stamp participation and unemployment have dropped to their 1990
and 1989 levels, respectively, as the U.S. economy has expanded. (See
table I.1 in app. I for data on food stamp participation by state.) However,
the number of people living in poverty, which peaked at 39.3 million in
1993, declined more gradually and leveled off after 1995—about 4 million
more people were living in poverty in 1997 than in 1989.




2
 See Welfare Reform: States Are Restructuring Programs to Reduce Welfare Dependence
(GAO/HEHS-98-109).
3
 States may ask to waive the work requirement for groups of individuals who live in an area where the
unemployment rate is over 10 percent or there are not enough jobs to provide employment.
4
 As of Nov. 1, 1998, the Agricultural Research, Extension, and Education Reform Act of 1998 (P.L.
105-185) restored eligibility for the Food Stamp Program to permanent resident aliens who (1) were
living in the United States when the Welfare Reform Act was enacted in Aug. 1996 and were over 65 or
disabled or (2) are under age 18.



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Figure 1: Number of Food Stamp
Participants Compared With Numbers
                                         People in millions
of Unemployed People and People
Living in Poverty, 1989-98




                                     Note: The number of people living in poverty is unavailable for 1998.

                                     Sources: FNS; the Bureau of Labor Statistics, Department of Labor; and the Bureau of the
                                     Census, Department of Commerce.




                                     The number of people who received food stamp benefits has declined each
                                     year since fiscal year 1994, with most of the decline occurring after fiscal
                                     year 1996. Between fiscal year 1996 and fiscal year 1998, the food stamp
                                     rolls decreased by 5.8 million participants, accounting for 75 percent of the
                                     total decrease since fiscal year 1994. Food stamp participation dropped in
                                     each state, declining by an average of 23 percent and ranging from about
                                     32 percent in Wisconsin to 6 percent in Hawaii. (See table I.2 in app. I for
                                     the states with the greatest decline in participation.)



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                        The primary factors contributing to the decline in food stamp participation
Various Factors Have    have been the strong U.S. economy, provisions of the Welfare Reform Act
Caused the Decline in   that tightened the Food Stamp Program’s eligibility requirements, and
Food Stamp              state and local government initiatives designed to reduce TANF rolls,
                        according to the 50 respondents to our survey5 and FNS’ most recent
Participation           report.6 Few states cited any other factor as a major or moderate reason
                        for the recent decline in food stamp participation. Overall, 27 states
                        attributed the decline in food stamp participation in their state primarily to
                        a drop in the number of people eligible to receive food stamps, while the
                        decline in the number of eligible people who participate in the program
                        was less important. FNS’ data similarly show that the number of people
                        eligible for food stamps declined by 18 percent from August 1996 to
                        September 1997, reflecting the strong economy and tighter eligibility
                        requirements. In contrast, seven states attributed the decline in food stamp
                        participation in their state primarily to a drop in the number of eligible
                        people who participate in the program. In recent years, the number of
                        children living in poverty who receive food stamp benefits has dropped,
                        indicating a growing gap between need and assistance. USDA also reported
                        that the number of children receiving free lunches through its school lunch
                        program increased by 6.4 percent from fiscal year 1994 through fiscal year
                        1997.

                        Forty-two states cited their improved state economy as either a major or a
                        moderate reason for the decline in food stamp participation since 1996.
                        (See table 1.) The strong U.S. economy has reduced the number of eligible
                        people because more people are employed and earning more money,
                        reducing the number of people who meet the Food Stamp Program’s
                        income eligibility standard. The strong economy has also reduced the
                        length of time some people spend on the food stamp rolls because they
                        can find a new job faster. Finally, the strong economy may indirectly lower
                        the percentage of eligible people participating in the program because, as
                        households’ income levels rise and food stamp benefits fall proportionally,
                        households may decide not to apply or seek recertification for these
                        benefits, especially when they approach the $10-per-month minimum level.




                        5
                        These respondents, referred to as “states” in the remainder of this report, include 49 states and the
                        District of Columbia. Rhode Island did not respond to our questionnaire.
                        6
                          Characteristics of Food Stamp Households for fiscal year 1997 (Feb. 1999) cited these factors but
                        could not determine the relative importance of each factor in causing the drop in food stamp
                        participation.



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Table 1: Distribution of Reasons Cited by States for the Decline in Food Stamp Participation
                                                                                                                   Minor   No basis to
                                                                                       Major      Moderate    reason/not   judge/does
Reason cited for the decline                                                          reason        reason      a reason     not apply
Improved state economy/more people with jobs                                             28             14             4             3
Changes in federal law that tightened food stamp requirements for
able-bodied adults without dependents                                                     7             20            21             2
Changes in federal law that tightened food stamp eligibility requirements for
legal immigrants                                                                          5             15            29             1
Federal, state, or local welfare reform initiatives designed to reduce the
TANF caseload that also affected food stamp participation                                 5             14            27             4
Fewer months spent by participants on the food stamp rolls                                2             12            15            21
Perceived stigma associated with receiving food stamps                                    0               4           36            10
Small monthly food stamp benefits/not worth the time and effort to apply or
be recertified for food stamps                                                            0               3           39             8
Change in attitudes of potential food stamp applicants to rely primarily on
themselves and their families rather than on food stamps                                  0               3           27            18
Automation/technology improvements that reduced fraud and waste                           0               4           35            11
Net movement of eligible individuals and households out of the state                      0               0           32            18
Implementation of electronic benefit transfer (EBT) card that discouraged
use by participants lacking experience with electronic cards                              0               0           32            18
                                                Source: State-reported survey data.



                                                Many states believe that the tighter eligibility restrictions on able-bodied
                                                adults without dependents and on permanent resident aliens are important
                                                reasons for the drop in food stamp participation. Specifically, 27 states
                                                cited the new work requirements for able-bodied adults without
                                                dependents as a major or moderate reason for the decline in food stamp
                                                participation. Similarly, 20 states cited the new restrictions on permanent
                                                resident aliens as a major or moderate reason for the decline in food
                                                stamp participation. California, Florida, and Texas, which have large
                                                permanent resident alien populations, cited the new restrictions on
                                                permanent resident aliens as a major reason for the decline in their food
                                                stamp rolls; New York, which also has a large permanent resident alien
                                                population, cited these restrictions as a moderate reason for the decline in
                                                its food stamp rolls. During fiscal year 1997, participation in the Food
                                                Stamp Program by able-bodied adults without dependents and by
                                                permanent resident aliens fell by about 714,000 people, accounting for
                                                about 25 percent of the decline in food stamp participation. (See tables II.1
                                                and II.2 in app. II for information about categories of participants.)




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                                        Federal, state, or local initiatives designed to reduce the TANF caseload
                                        were cited by 19 states as a major or moderate reason and by 19 additional
                                        states as a minor reason for the decline in their food stamp rolls. As shown
                                        in figure 2, participation in both welfare and the Food Stamp Program
                                        peaked in 1994 and has dropped sharply since then. The number of welfare
                                        recipients dropped by about 43 percent, from about 14.2 million in 1994 to
                                        about 8.1 million in August 1998. About two-thirds of this decline occurred
                                        after August 1996, when the Welfare Reform Act was enacted and there
                                        were about 12.2 million welfare recipients. The number of TANF recipients
                                        leaving the Food Stamp Program during fiscal year 1997 was almost twice
                                        as great as the number of non-TANF recipients. (See tables II.3 and II.4 in
                                        app. II.)


Figure 2: Number of Food Stamp
Participants Compared With Number           Participants in millions
of AFDC/TANF Recipients, 1989 Through
1998




                                        Source: FNS and the Administration for Children and Families.




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Studies conducted by various states suggest that many former TANF
recipients do not receive food stamp benefits, even though they are
eligible.7 For example, a Wisconsin study found that former welfare
recipients had a median wage of $7.00 per hour, which would meet the
food stamp income eligibility standard for a household of three; however,
51 percent of these former recipients did not receive food stamps, and
34 percent of the former recipients were unaware that they might still
qualify for food stamps.8 The Wisconsin study also found that 32 percent
of the state’s former welfare recipients had no way to buy food for some
period of time after they left welfare and 13 percent relied on food pantries
for assistance. Similarly, a South Carolina study found that former welfare
recipients had an average wage of $6.45 per hour, which was below the
food stamp income eligibility requirement for a household of three;
however, 40 percent of these former recipients did not receive food
stamps, and 22 percent were unaware that they might qualify for food
stamps.9 The South Carolina study also found that 13 percent of the state’s
former welfare recipients had no way to buy food for some period of time
after they left welfare and 17 percent received assistance from a shelter or
food pantry. Studies conducted by Massachusetts and Texas found similar
trends.10

The food stamp directors of four FNS regional offices told us that the
implementation of TANF has been an important factor in the decline in food
stamp participation in their regions. In particular, the directors cited
confusion about the eligibility rules for both TANF and food stamps as a
deterrent to potential applicants. According to these directors, many
people do not apply for food stamps because they assume that if they are
ineligible for TANF, they are also ineligible for food stamps. One director
noted that one of the most common problems identified by the regional
office’s state operations reviews is confusion over eligibility
requirements—on the part of both the eligibility workers and the food
stamp applicants.

7
 Although these studies did not specifically examine food stamp participation among eligible former
TANF recipients, they provide data on former recipients’ earnings and receipt of food stamps.
8
Survey of Those Leaving AFDC or W-2 January to March 1998 Preliminary Report, State of Wisconsin,
Department of Workforce Development (Jan. 13, 1999).
9
 Survey of Former Family Independence Program Clients: Cases Closed during July through
September 1997, South Carolina Department of Social Services, Division of Program Quality Assurance
(Oct. 9, 1998).
10
 How Are They Doing? A Longitudinal Study of Households Leaving Welfare Under Massachusetts
Reform, Massachusetts Department of Transitional Assistance (Apr. 1999) and Texas Families in
Transition: The Impacts of Welfare Reform Changes in Texas, Early Findings, Texas Department of
Human Services (Dec. 1998).



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The Percentage of Children             As shown in table 2, there is a growing gap between the number of
Living in Poverty Who                  children living in poverty—an important indicator of children’s need for
Received Food Stamp                    food assistance—and the number of children receiving food stamp
                                       assistance. In particular, during fiscal year 1997, the number of children
Benefits Dropped in 1997               living in poverty dropped by 350,000 (or 3 percent) while the number of
                                       children participating in the Food Stamp Program dropped by 1.3 million
                                       (or 10 percent). As a result, the percentage of children living in poverty
                                       who received food stamps declined from 91.4 percent to 84.1 percent.

Table 2: Comparison of the Number of
Children Receiving Food Stamps With    Children in thousands
the Number of Children Living in                                                                                           Percentage of
Poverty, 1989-97                                                                                                        children living in
                                                                               Children who                                  poverty who
                                                                               received food         Children living       received food
                                       Year                                          stampsa             in povertyb              stamps
                                       1989                                             9,442                  12,590                75.0
                                       1990                                            10,139                  13,431                75.5
                                       1991                                            11,960                  14,341                83.4
                                       1992                                            13,364                  15,294                87.4
                                       1993                                            14,211                  15,727                90.4
                                       1994                                            14,407                  15,289                94.2
                                       1995                                            13,879                  14,665                94.6
                                       1996                                            13,212                  14,463                91.4
                                       1997                                            11,868                  14,113                84.1
                                       a
                                        Totals are estimates by fiscal year.
                                       b
                                           Totals are estimates by calendar year.

                                       Sources: FNS for food stamp data and the U.S. Bureau of the Census, within the U.S. Department
                                       of Commerce, for poverty data.



                                       Figure 3 shows that children’s participation in the Food Stamp Program
                                       has declined at the same rate as adults’ participation.11 Children
                                       consistently accounted for about half of all Food Stamp Program
                                       participants from fiscal year 1989 through fiscal year 1997. From fiscal
                                       year 1994 through fiscal year 1997, the number of children receiving food
                                       stamps declined by an estimated 2.5 million. (See tables II.5 and II.6 in app.
                                       II for information on the distribution of food stamp participants by age.)
                                       Most of this drop occurred during fiscal year 1997, when an estimated
                                       1.3 million children left the Food Stamp Program. This drop in children’s


                                       11
                                           The Food Stamp Program defines children as being less than 18 years old.



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                                        participation accounted for 48 percent of the total decline in participation
                                        during fiscal year 1997.


Figure 3: Children as a Proportion of
All Participants in the Food Stamp                    Participants in millions
Program, Fiscal Years 1989-97

                                              30


                                              27


                                              24


                                              21


                                              18


                                              15


                                              12


                                                  9


                                                  6


                                                  3


                                                  0
                                                       1989     1990     1991     1992        1993   1994    1995    1996   1997

                                                                                       Fiscal year
                                                         Other participants (18+ years)

                                                         Children participants (0-17 years)




                                        Source: FNS.




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Demand for Food              Data from USDA and several nonprofit organizations show that the demand
Assistance Has Increased     for food assistance by low-income families has increased in recent years,
While Food Stamp             indicating that the drop in food stamp participation is not solely the result
                             of a strong U.S. economy. According to these data, the need for food
Participation Has Declined   assistance has not diminished; rather, needy individuals are relying on
                             sources of assistance other than food stamps. For example, the number of
                             children served free lunches in USDA’s National School Lunch Program
                             increased by 6 percent from fiscal year 1994 through fiscal year 1997,
                             while the number of school-age children participating in the Food Stamp
                             Program declined by 18 percent—about 5 million more children obtained
                             free lunches than food stamps in fiscal year 1997.12 (See table II.7 in app.
                             II.) Catholic Charities reported that during 1998, the demand for
                             emergency food assistance rose, on average, by 38 percent among
                             73 percent of the local parishes that responded to its survey. Similarly,
                             from November 1997 through October 1998, requests for emergency food
                             assistance by needy individuals increased by an average of 14 percent in
                             21 of the 30 major cities surveyed by the U.S. Conference of Mayors.


                             While many states have treated food stamps as an important safety net
Some Eligible                that helps the working poor move from public assistance to the workforce,
Families With                several state and local governments have implemented more stringent
Children Have Had            policies that have restricted the access to food stamp benefits of an
                             undeterminable number of eligible families with children. In particular, FNS
Problems Obtaining           regional offices have investigated practices in New York City; Portland,
Food Stamps                  Oregon; and Milwaukee, Wisconsin, and found barriers to food stamp
                             participation. Similarly, at least seven states have policies that improperly
                             remove eligible households with children from the food stamp rolls as a
                             sanction for a TANF violation. This has occurred, in part, because FNS has
                             not promulgated regulations that implement the Welfare Reform Act’s
                             revisions to the Food Stamp Program. Without regulations, state and local
                             governments believe they have the flexibility to implement more stringent
                             requirements associated with the TANF program than FNS believes is
                             appropriate. In addition, FNS regional offices have not reviewed
                             participants’ access to food stamp benefits in 10 states since the Welfare
                             Reform Act was enacted in August 1996. These reviews have not occurred,
                             in part, because some regional offices have not annually reviewed Food
                             Stamp Program operations in each state within their jurisdiction, as
                             required.



                             12
                              To be eligible for a free lunch, a child must come from a household whose income is at or below
                             130 percent of the federal poverty guideline.



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Three Regional FNS               During the past year, FNS regional offices have reviewed access to the
Reviews Reveal Barriers to       Food Stamp Program in New York, Oregon, and Wisconsin in response to
Participation                    complaints from advocacy groups and a Member of Congress. As
                                 described more fully in appendix III, each of these reviews has identified
                                 barriers that have made the Food Stamp Program less accessible for
                                 eligible people.

                             •   FNS found that New York City violated federal law and regulations because
                                 caseworkers at the two job centers it reviewed (1) did not permit
                                 households to apply for food stamps during their first visit; (2) did not
                                 inform applicants about the availability of food stamps if the applicants
                                 either were denied TANF benefits or accepted a onetime, lump-sum
                                 payment (known as a diversion payment) instead of applying for TANF
                                 benefits; and (3) frequently denied food stamp benefits to applicants who
                                 did not participate in eligibility verification for food stamps and
                                 employment-related activities primarily for TANF. In addition, FNS’ food
                                 stamp director for the Northeast Region told us that job center staff were
                                 informing applicants that expedited food stamps were no longer available,
                                 refusing to accept food stamp applications because it was “too late” in
                                 the day, and encouraging applicants to withdraw their food stamp
                                 applications. While New York City officials initially disagreed with FNS’
                                 report, citing the agency’s reliance on regulations that the officials
                                 believed were inconsistent with the Welfare Reform Act, New York City
                                 implemented New York State’s corrective action plan that addressed FNS’
                                 concerns in April 1999.

                                 In addition, in January 1999, a federal district court granted a preliminary
                                 injunction, in effect barring New York City from using certain procedures.
                                 The court found that the plaintiffs and other applicants for food stamp
                                 benefits, Medicaid, and cash assistance would suffer irreparable harm if
                                 relief were not provided through a preliminary injunction. As a result, the
                                 court directed New York City, among other things, to (1) allow all persons
                                 applying for food stamps, Medicaid, and cash assistance to apply for such
                                 benefits on the first day that they visit a job center and (2) process all
                                 applications for expedited food stamps at job centers within the time
                                 frames required by law.

                             •   FNS found that certain area offices in Portland, Oregon, had procedures
                                 that created possible barriers to participation. Food stamp applicants who
                                 arrived after 8:30 a.m. were told to return to the office on another day to
                                 file their applications. Furthermore, the offices’ “first-come, first-served”
                                 procedures created situations where clients who arrived before 8:30 a.m.



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                               had waited all day without being seen by an eligibility worker, only to be
                               told at the close of business to return on another day and start over again.
                               Although Oregon officials questioned some of FNS’ findings and
                               recommendations, they submitted a corrective action plan that addressed
                               FNS’ concerns.


                               FNS officials noted that procedures that require food stamp applicants to
                               return for a second day create barriers to participation, especially for the
                               working poor, because most food stamp offices are open only during
                               business hours.13 Furthermore, many participants are required to return to
                               the food stamp office four times a year to be recertified for food stamps. A
                               3-month recertification period has become more common because the
                               states are seeking to reduce errors, such as overpayments resulting from
                               changes in a household’s income or composition. Households with earned
                               income typically are recertified more often than households on fixed
                               incomes because their incomes are more likely to change.

                           •   FNS found that several practices violated federal regulations in its review of
                               two welfare centers in Milwaukee, Wisconsin. However, FNS believed that
                               these centers were not intentionally trying to divert potential applicants
                               from food stamp benefits. For example, staff at the centers did not
                               (1) inform applicants of their right to file a food stamp application on the
                               day of their first contact with the office and (2) provide food stamp
                               applications upon request.14 In addition, FNS found that the centers
                               hindered participation because posters that outline food stamp applicants’
                               rights were not displayed and clients’ work schedules were not taken into
                               account when recertification interviews were scheduled. Although
                               Wisconsin officials questioned some of FNS’ findings, they submitted a
                               corrective action plan that FNS currently is reviewing.


Some States Have               Some states have used what is called the comparable disqualification
Disqualified Whole             provision of the Welfare Reform Act to disqualify an entire household from
Households From the Food       participation in the Food Stamp Program because one member has
                               violated a TANF requirement. The comparable disqualification provision
Stamp Program for TANF         gives the states the option to (1) disqualify a food stamp participant who
Violations by Individual       has been disqualified under another means-tested program and (2) apply
Members
                               13
                                Five states cited the inconvenience of being recertified during business hours as a moderate reason
                               why eligible households with children do not participate in the Food Stamp Program, while 20 states
                               characterized it as a minor reason.
                               14
                                Failing to inform applicants of their right to file a food stamp application on the day of their first
                               contact with the office also violates the Food Stamp Act.



                               Page 14                                                 GAO/RCED-99-185 Food Stamp Participation
                           B-282728




                           the disqualification for benefits under the other means-tested program to
                           food stamp benefits. As a result, the states can disqualify a food stamp
                           participant for not complying with TANF’s work requirements, even if the
                           participant is exempt from work requirements under the Food Stamp
                           Program’s rules.

                           Initially, FNS’ guidance allowed the states to decide whether to disqualify
                           the entire household or just the noncomplying individual. However, FNS
                           reversed its position in November 1997 and directed the states to
                           disqualify only the noncomplying individual. Despite the revision in FNS’
                           guidance, 7 states said they disqualify an entire household for food stamp
                           benefits because of a member’s TANF violations, 13 states said they
                           determine whom to sanction for a TANF violation on a case-by-case basis,
                           and 2 states said they had previously suspended the food stamp benefits of
                           an entire household for a member’s TANF violations. In March 1998, a
                           federal district court (in an unreported decision) directed Michigan to stop
                           disqualifying an entire household for food stamps because of a member’s
                           TANF violation (not cooperating in obtaining child support). An FNS regional
                           official told us that FNS cannot force states to change their policies until
                           FNS publishes regulations for implementing the comparable
                           disqualification provision.


FNS Has Not Promulgated    The Welfare Reform Act revised the Food Stamp Program’s administrative
Regulations for            requirements by replacing several specific requirements with more general
Implementing the Welfare   performance standards. Specifically, the act allows each state to establish
                           procedures for operating its food stamp offices that the state determines
Reform Act’s Revisions     best serve its households provided, in part, that the state (1) provides
                           timely, accurate, and fair service to applicants for, and participants in, the
                           Food Stamp Program and (2) permits households to apply to participate in
                           the program on the same day that they first contact a food stamp office in
                           person during office hours. It is unclear whether, as a result of this
                           revision, FNS will continue to require, for example, that the states
                           prominently display signs in all food stamp certification offices explaining
                           eligibility standards and inform each applicant for assistance of the right
                           to apply for food stamps on the day of initial contact.

                           Although the Welfare Reform Act was enacted almost 3 years ago, FNS has
                           not promulgated regulations implementing the act’s food stamp revisions
                           because of delays in USDA’s clearance process. FNS could not provide a
                           reason for the delay in promulgating regulations. In May 1999, FNS
                           published the first of several Notices of Proposed Rulemaking in the



                           Page 15                                 GAO/RCED-99-185 Food Stamp Participation
                           B-282728




                           Federal Register (this notice addressed an unrelated revision). FNS plans to
                           promulgate final rules for all of the Welfare Reform Act’s revisions by
                           December 2000. FNS has also provided guidance to the states on specific
                           issues, such as diversion payments and comparable disqualifications,
                           through policy memorandums and questions and answers posted on its
                           Web site. However, unlike federal regulations, this guidance is not binding.

                           Because FNS has not promulgated implementing regulations, some state
                           and local governments have implemented more stringent requirements
                           associated with the TANF program than FNS believes is appropriate. The
                           Midwest regional office has told its states that they are allowed to
                           interpret the Welfare Reform Act’s revisions for themselves until
                           regulations are published. New York City officials have petitioned USDA to
                           promulgate new regulations repealing food stamp regulations that, in New
                           York City’s opinion, are inconsistent with the Welfare Reform Act and to
                           clarify the ability of states and localities to implement the act’s goals in
                           their local food stamp offices.


FNS Has Not Examined       FNS’ regulations require that FNS regional offices annually review the
Program Access Issues in   operations of each state in their jurisdiction to ensure that the states are
Many States                complying with federal regulations implementing the Food Stamp
                           Program. These reviews have previously identified obstacles to gaining
                           access to benefits and have directed the states to correct their procedures.
                           For example, the regional offices have found untimely application
                           processing, a lack of bilingual staff, confusion over rules and regulations
                           affecting eligibility, and failure to inform applicants who have been denied
                           TANF benefits about the availability of food stamps. Each of these
                           problems, if uncorrected, creates a barrier to participation for eligible
                           households. However, we found that only three of the seven regional
                           offices regularly conduct an annual review of each state in their
                           jurisdiction. The other offices said they did not have sufficient staff
                           resources to annually examine each state’s operations. Even when the
                           regional offices review the states’ operations, they often do not evaluate
                           the access of potential participants to food stamp benefits. As of June 21,
                           1999, FNS regional offices had not examined program access issues in 10
                           states since the beginning of fiscal year 1997. (See app. IV.)


                           While the strong U.S. economy and legislation revising eligibility
Conclusions                requirements for the Food Stamp Program are important reasons why
                           participation in the program is declining, several state and local



                           Page 16                                GAO/RCED-99-185 Food Stamp Participation
                         B-282728




                         governments have implemented stringent policies designed to reduce their
                         TANF caseloads that have restricted low-income families’ access to food
                         stamp benefits. Because FNS found that some of these policies violate food
                         stamp law, it has worked with the states to make appropriate changes. FNS
                         also determined that some states’ implementation of the Welfare Reform
                         Act’s comparable disqualification provision is not supported by law.
                         However, FNS has not ordered the states to change their policies, and FNS
                         has not promulgated regulations implementing the Welfare Reform Act’s
                         revisions to the Food Stamp Act. As long as the policies remain in effect,
                         some qualifying households, including those with children, may not be
                         receiving food stamp benefits to which they are legally entitled. This is
                         important because the number of children living in poverty who receive
                         food stamps has declined in recent years, indicating a growing gap
                         between need and assistance. In addition, states’ studies of TANF reform
                         indicate that many former TANF recipients may not receive food stamp
                         benefits because they are unaware that they may qualify for food stamps.
                         Further exacerbating this problem, FNS regional offices inconsistently
                         enforce food stamp requirements and some do not annually review each
                         state’s operations, as required. Finally, when FNS performs such reviews, it
                         does not always examine people’s access to food stamp benefits.


                         To ensure that eligible people receive food stamp benefits, we recommend
Recommendations          that the Secretary of Agriculture direct the Administrator, Food and
                         Nutrition Service, to take the following actions:

                     •   Promulgate regulations implementing the Welfare Reform Act’s revisions
                         to the Food Stamp Act. These regulations should, at a minimum, require
                         that the states (1) inform each applicant for assistance of the right to apply
                         for food stamps during the first meeting, regardless of whether the
                         applicant applies for other assistance, and (2) sanction the food stamp
                         benefits only of the individual who does not comply with requirements of
                         the Temporary Assistance for Needy Families program.
                     •   Publicize eligibility requirements for the Food Stamp Program and
                         distinguish them from the eligibility requirements for the Temporary
                         Assistance for Needy Families program.
                     •   Give higher priority to aggressively targeting issues related to participants’
                         access to food stamp benefits in reviewing states’ food stamp operations.


                         We provided the U.S. Department of Agriculture with a draft of this report
Agency Comments          for review and comment. We met with Agriculture officials, including the
and Our Evaluation

                         Page 17                                 GAO/RCED-99-185 Food Stamp Participation
              B-282728




              Associate Deputy Administrator for the Food Stamp Program within the
              Food and Nutrition Service. The Department agreed with the thrust of the
              report and with our recommendations for promulgating regulations
              implementing the Welfare Reform Act’s revisions and publicizing eligibility
              requirements for the Food Stamp Program. In response to our proposed
              recommendation that Agriculture develop a strategy for ensuring an
              annual review of each state’s food stamp operations, the Department said
              that on-site reviews would be difficult to conduct at each state annually,
              given resource constraints, but agreed on the importance of targeting
              participant access issues. We revised our proposed recommendation,
              eliminating the reference to conducting annual reviews of each state’s
              operations while continuing to emphasize the importance of targeting
              issues associated with participants’ access to food stamp benefits. In
              addition, the Department provided comments to improve the report’s
              technical accuracy, which we incorporated as appropriate.

              We also made portions of the draft report available to the states of New
              York, Oregon, and Wisconsin. New York officials pointed out that the
              decline in food stamp participation in their state either has mirrored or is
              below the national trend for various periods between 1994 and 1999. While
              we agree with New York State’s point, we did not modify the report
              because it does not discuss individual states’ food stamp participation
              rates. (See app. V. for New York’s written comments and our responses.)
              In addition, Oregon and Wisconsin provided comments to improve the
              report’s technical accuracy, which we incorporated as appropriate. (See
              app. VI for Wisconsin’s written comments.)


              To assess the reasons individual states cite for the recent drop in food
Scope and     stamp participation, we surveyed the food stamp directors of the 50 states
Methodology   and the District of Columbia about their (1) perceptions as to why, for
              example, their state’s food stamp rolls have declined and eligible
              households with children may decide not to apply for food stamps and
              (2) state’s food stamp participation data, to the extent that these data were
              readily available. We received responses to our questionnaire from 49
              states and the District of Columbia (Rhode Island did not return the
              questionnaire). However, most of the states could not readily provide data
              on food stamp participation by categories of participants, recertifications,
              applications, or sanctions. We also obtained FNS’ official participation data
              (known as “keydata”) and FNS’ quality control data. The keydata reflect
              the monthly number of food stamp participants in each state. The quality
              control data, which are derived from a national probability sample of



              Page 18                                 GAO/RCED-99-185 Food Stamp Participation
B-282728




participating food stamp households, provide participation information for
children, the elderly, and other categories of food stamp participants.
Fiscal year 1997 data are the most current quality control data available.
We used both data sources to provide aggregate level trends from fiscal
year 1989 through fiscal year 1998 and children’s participation trends from
fiscal year 1989 through fiscal year 1997. We interviewed cognizant FNS
officials and representatives of Mathematica Policy Research, Inc., which
for several years has had a contract with FNS to analyze food stamp
participation trends. In addition, we examined several states’ studies of
former TANF recipients that provided data on former recipients’ earnings
and receipt of food stamps.

To identify the problems eligible households with children may be having
in obtaining food stamps, we surveyed states about their policies and
procedures for implementing the Food Stamp Program, including their
procedures for sanctioning TANF violations. We also examined program
access reviews that FNS regional offices have conducted in New York,
Oregon, and Wisconsin. Each of these reviews identified barriers that
reduced eligible people’s access to the Food Stamp Program. We
interviewed cognizant officials at FNS headquarters about its plans to
promulgate regulations and at each of its seven regional offices about their
annual reviews of states’ operations. We performed our work from August
1998 through June 1999 in accordance with generally accepted
government auditing standards. We did not independently verify the
accuracy of participation data from FNS’ quality control sample. The quality
control sample data are the best data available for examining participation
by categories of food stamp participants.


As arranged with your offices, unless you publicly announce its contents
earlier, we plan no further distribution of this report until 30 days after the
date of this letter. At that time, we will send copies of the report to the
congressional committees and subcommittees responsible for the Food
Stamp Program; the Honorable Dan Glickman, Secretary of Agriculture;
the Honorable Jacob Lew, Director, Office of Management and Budget;
and other interested parties. We will also make copies available upon
request.




Page 19                                  GAO/RCED-99-185 Food Stamp Participation
B-282728




Please contact me at (202) 512-5138 if you or your staff have any questions
about this report. Key contributors to this report are listed in appendix VII.




Lawrence J. Dyckman
Director, Food and Agriculture Issues




Page 20                                 GAO/RCED-99-185 Food Stamp Participation
Page 21   GAO/RCED-99-185 Food Stamp Participation
Contents



Letter                                                                                1


Appendix I                                                                           26

Food Stamp
Participation Trends
Appendix II                                                                          29

Changes in
Participation Among
Selected Food Stamp
Populations
Appendix III                                                                         35
                         New York City                                               35
FNS’ Program Access      Portland, Oregon                                            36
Reviews Reveal           Milwaukee, Wisconsin                                        37
Barriers to
Participation
Appendix IV                                                                          38

States Reviewed by
FNS Concerning
Participants’ Access
to Food Stamp
Benefits, Fiscal Years
1997-99
Appendix V                                                                           40

Comments From New
York State




                         Page 22                GAO/RCED-99-185 Food Stamp Participation
                   Contents




Appendix VI                                                                                  44

Comments From
Wisconsin
Appendix VII                                                                                 46

GAO Contacts and
Staff
Acknowledgments
Tables             Table 1: Distribution of Reasons Cited by States for the Decline           7
                     in Food Stamp Participation
                   Table 2: Comparison of the Number of Children Receiving Food              10
                     Stamps With the Number of Children Living in Poverty, 1989-97
                   Table I.1: Average Monthly Number of Food Stamp Participants,             26
                     by State, Fiscal Years 1990-98
                   Table I.2: States With the Greatest Percentage Decline in Food            28
                     Stamp Participation Since the Enactment of the Welfare Reform
                     Act, Fiscal Years 1996-98
                   Table II.1: Selected Demographic Characteristics of Food Stamp            29
                     Participants, Fiscal Years 1996-97
                   Table II.2: Permanent Resident Aliens Who Received Food                   30
                     Stamps, Fiscal Years 1994-97
                   Table II.3: Change in AFDC/TANF and Food Stamp Participation              30
                     Since the Enactment of the Welfare Reform Act, August 1996 to
                     August 1998
                   Table II.4: Food Stamp Participation by TANF Participants and             32
                     Non-TANF Participants, Fiscal Years 1996-97
                   Table II.5: Age Distribution of Food Stamp Participants, Fiscal           32
                     Years 1989-97
                   Table II.6: Number of Children Who Received Food Stamps, by               33
                     State, Fiscal Years 1995-97
                   Table II.7: Number of School-Age Children Receiving Food                  34
                     Stamps Compared With the Number of Children Receiving Free
                     Lunches in School, Fiscal Years 1994-97

Figures            Figure 1: Number of Food Stamp Participants Compared With                  5
                     Numbers of Unemployed People and People Living in Poverty,
                     1989-98




                   Page 23                              GAO/RCED-99-185 Food Stamp Participation
Contents




Figure 2: Number of Food Stamp Participants Compared With                    8
  Number of AFDC/TANF Recipients, 1989 through 1998
Figure 3: Children as a Proportion of All Participants in the Food          11
  Stamp Program, Fiscal Years 1989-97




Abbreviations

AFDC       Aid to Families with Dependent Children
FNS        Food and Nutrition Service
GAO        General Accounting Office
TANF       Temporary Assistance for Needy Families
USDA       U.S. Department of Agriculture


Page 24                                GAO/RCED-99-185 Food Stamp Participation
Page 25   GAO/RCED-99-185 Food Stamp Participation
Appendix I

Food Stamp Participation Trends


                                             The data in this appendix are the actual number of participants reported
                                             monthly by each state to the U.S. Department of Agriculture’s (USDA)
                                             National Data Bank.


Table I.1: Average Monthly Number of Food Stamp Participants, by State, Fiscal Years 1990-98
Participants in thousands
                                                                                                                  Change in
                               Fiscal year        Fiscal year    Fiscal year     Fiscal year     Fiscal year      number of
State                                1990               1992           1994            1996            1998      participants
Alabama                              453.5             549.7          547.7           509.2            426.8           –82.4
Alaska                                25.1              37.7           45.9            46.2             42.5            –3.7
Arizona                              317.1             457.1          511.7           427.5            295.7          –131.8
Arkansas                             234.9             276.8          282.5           273.9            255.7           –18.2
California                         1,954.8           2,557.9        3,154.6         3,143.4          2,259.1          –884.3
Colorado                             221.3             259.7          268.3           243.7            191.0           –52.7
Connecticut                          133.3             202.3          222.6           222.8            195.9           –26.9
Delaware                              33.3              50.6           59.2            57.8             45.6           –12.2
Florida                              781.5           1,403.9        1,474.4         1,371.4            990.6          –380.8
Georgia                              535.6             754.1          830.4           792.5            631.7          –160.8
Hawaii                                77.0              94.3          114.6           130.3            122.0            –8.3
Idaho                                 58.6              71.9           81.5            79.9             62.4           –17.5
Illinois                           1,013.1           1,156.4        1,188.8         1,105.2            922.9          –182.3
Indiana                              310.9             447.7          517.9           389.5            313.1           –76.4
Iowa                                 170.5             192.3          195.7           177.3            141.1           –36.2
Kansas                               142.3             174.5          191.7           171.8            119.2           –52.6
Kentucky                             458.2             528.8          522.3           485.6            412.0           –73.6
Louisiana                            727.3             779.3          756.4           670.0            536.8          –133.2
Maine                                 93.8             132.5          135.8           130.9            115.1           –15.8
Maryland                             254.7             342.2          390.2           374.5            322.7           –51.8
Massachusetts                        347.3             428.8          441.8           373.6            293.0           –80.6
Michigan                             916.6             994.2        1,030.7           935.4            771.6          –163.8
Minnesota                            262.9             308.9          313.5           294.8            219.7           –75.1
Mississippi                          499.2             535.9          510.5           457.1            329.1          –128.0
Missouri                             431.4             549.5          593.1           553.9            411.0          –142.9
Montana                               56.7              66.3           71.4            70.8             62.3            –8.5
Nebraska                              94.5             107.3          110.8           101.6             94.9            –6.7
Nevada                                49.8              79.7           96.7            96.7             71.5           –25.2
New Hampshire                         30.6              57.7           61.6            52.8             39.6           –13.2
New Jersey                           381.6             494.1          545.3           540.5            424.7          –115.8
New Mexico                           157.3             221.3          244.3           235.1            174.7           –60.4
                                                                                                                  (continued)


                                          Page 26                                    GAO/RCED-99-185 Food Stamp Participation
                                         Appendix I
                                         Food Stamp Participation Trends




Participants in thousands
                                                                                                                             Change in
                            Fiscal year        Fiscal year         Fiscal year        Fiscal year         Fiscal year        number of
State                             1990               1992                1994               1996                1998        participants
New York                       1,548.3              1,885.1            2,153.6              2,098.6           1,627.2             –471.4
North Carolina                   419.0                596.7              629.9               631.1              527.8             –103.3
North Dakota                      39.1                 45.9                45.4               39.8                33.8                 –6.0
Ohio                           1,089.5              1,250.6            1,245.2              1,045.1             733.6             –311.5
Oklahoma                         266.6                346.0              376.0               353.8              287.8                 –66.0
Oregon                           216.4                264.9              286.3               287.6              238.4                 –49.2
Pennsylvania                     952.0              1,137.4            1,208.3              1,123.5             906.7             –216.8
Rhode Island                      64.1                 87.4                93.8               90.9                72.8                –18.1
South Carolina                   299.2                368.8              385.4               358.3              333.0                 –25.3
South Dakota                      50.4                 54.7                53.3               48.8                45.2                 –3.6
Tennessee                        526.6                701.6              734.6               637.8              538.5                 –99.3
Texas                          1,879.9              2,454.0            2,725.8              2,372.0           1,636.2             –735.8
Utah                              99.5                123.2              127.8               110.0                91.8                –18.2
Vermont                           38.4                 53.5                64.6               56.5                45.7                –10.8
Virginia                         345.9                495.5              547.1               537.5              396.6             –140.9
Washington                       340.3                431.5              467.6               476.4              362.2             –114.2
West Virginia                    261.8                309.6              321.4               299.7              269.1                 –30.6
Wisconsin                        285.8                334.0              329.8               283.3              192.9                 –90.4
Wyoming                           28.3                 33.4                34.0               33.0                25.5                 –7.5
District of Columbia              62.1                 82.3                90.7               92.8                85.4                 –7.4
Guam                              11.7                 19.8                15.2               17.6                25.2                  7.6
Virgin Islands                    17.6                 16.5                20.0               30.7                17.3                –13.4
Total                         20,066.8             25,405.6           27,467.8             25,540.3          19,786.7           –5,753.6

                                         Note: Puerto Rico is excluded because it receives block grant funding. Columns may not add
                                         because of rounding.

                                         Source: Food and Nutrition Service (FNS), USDA.




                                         Page 27                                            GAO/RCED-99-185 Food Stamp Participation
                                       Appendix I
                                       Food Stamp Participation Trends




Table I.2: States With the Greatest
Percentage Decline in Food Stamp       Participants in thousands
Participation Since the Enactment of                          Fiscal year    Fiscal year     Fiscal year Percent change
the Welfare Reform Act, Fiscal Years   State                        1996           1997            1998     (FY 1996-98)
1996-98
                                       Wisconsin                    283.3         232.1            192.9           –31.9
                                       Texas                       2,372.0      2,033.8          1,636.2           –31.0
                                       Arizona                      427.5         363.8            295.7           –30.8
                                       Kansas                       171.8         148.7            119.2           –30.6
                                       Ohio                        1,045.1        873.6            733.6           –29.8
                                       California                  3,143.4      2,814.8          2,259.1           –28.1
                                       Mississippi                  457.1         399.1            329.1           –28.0
                                       Florida                     1,371.4      1,191.7            990.6           –27.8
                                       Virginia                     537.5         476.1            396.6           –26.2
                                       Nevada                        96.7          82.4             71.5           –26.1
                                       Source: FNS, USDA.




                                       Page 28                                   GAO/RCED-99-185 Food Stamp Participation
Appendix II

Changes in Participation Among Selected
Food Stamp Populations

                                     Many of the data provided in this appendix are derived from reports
                                     entitled Characteristics of Food Stamp Households, prepared by
                                     Mathematica Policy Research, Inc., for FNS. These reports are based on
                                     FNS’ Integrated Quality Control System, which uses a national probability
                                     sample of participating food stamp households, denials of applications,
                                     and terminations to monitor the accuracy of the Food Stamp Program’s
                                     operations.

Table II.1: Selected Demographic
Characteristics of Food Stamp        Participants in thousands
Participants, Fiscal Years 1996-97                                                                         Change in
                                     Characteristic of             Fiscal year         Fiscal year         number of           Percent
                                     participants                        1996                1997         participants         change
                                     Childrena                          13,212              11,868              –1,344            –10.2
                                          Preschool age                  4,815               4,046                  –769          –16.0
                                          School age                     8,399               7,825                  –574            –6.8
                                     Adults with
                                     dependents                          7,582               6,549              –1,033            –13.6
                                     Able-bodied
                                     adults without
                                     dependents                          1,107                  833                 –274          –24.8
                                     Permanent
                                     resident aliens                     1,463               1,023                  –440          –30.1
                                               b
                                     Elderly                             1,895               1,834                   –61            –3.2
                                                                                c                                          c               c
                                     Disabled                                                2,278
                                     a
                                      Children are defined as individuals who are 0-17 years old. Preschool-age children are under the
                                     age of 5 and school-age children are 5-17 years old.
                                     b
                                         Elderly people are defined as individuals who are 60 years old and over.
                                     c
                                     Data unavailable for fiscal year 1996.

                                     Source: FNS, Characteristics of Food Stamp Households, for fiscal years 1996-97.




                                     Page 29                                                GAO/RCED-99-185 Food Stamp Participation
                                               Appendix II
                                               Changes in Participation Among Selected
                                               Food Stamp Populations




Table II.2: Permanent Resident Aliens Who Received Food Stamps, Fiscal Years 1994-97
Participants in thousands
                                                                                                                                           Percent
                           Fiscal year 1994           Fiscal year 1995          Fiscal year 1996             Fiscal year 1997              change
State                        Total    Percenta           Total    Percenta         Total    Percenta          Total    Percenta       (FY 1996-97)
California                     463        13.2            431          13.2          445         13.5           302        10.4             –32.1
Florida                        132             8.8        127           8.9          157         10.9           103             8.4         –34.4
New York                       245        10.8            273          12.8          265         12.4           196        10.0             –26.0
Texas                          297        10.9            247           9.5          246         10.0           165             7.8         –32.9
All other                      316             1.8        373           2.1          350           2.1          256             1.7         –26.9
Total                        1,453             5.2      1,451           5.4        1,463           5.6        1,023             4.4         –30.1
                                               a
                                               Percentage of each state’s total food stamp participants.

                                           Source: FNS, Characteristics of Food Stamp Households, for fiscal year 1997.




Table II.3: Change in AFDC/TANF and Food Stamp Participation Since the Enactment of the Welfare Reform Act, August 1996
to August 1998
Participants in thousands
                                        AFDC/TANF participantsa                                          Food stamp participants
State                         August 1996            August 1998 Percent change            August 1996          August 1998 Percent change
Alabama                               100.7                  53.1               –47.3               505.1              415.6                –17.7
Alaska                                 35.5                  28.6               –19.4                 47.8              42.9                –10.3
Arizona                               169.4                 101.0               –40.4               424.9              276.0                –35.0
Arkansas                               56.3                  31.7               –43.7               274.6              253.3                  –7.8
California                           2,581.9              1,952.2               –24.4             3,076.1             2,131.2               –30.7
Colorado                               95.8                  49.0               –48.9               237.8              182.3                –23.3
Connecticut                           159.2                 122.1               –23.3               224.0              188.3                –15.9
Delaware                               23.7                  15.0               –36.7                 59.4              43.3                –27.1
Florida                               533.8                 247.8               –53.6             1,356.1              952.1                –29.8
Georgia                               330.3                 175.8               –46.8               776.8              606.2                –22.0
Hawaii                                 66.5                  46.4               –30.2               130.4              121.4                  –6.9
Idaho                                  21.8                   3.5               –83.9                 76.2              56.3                –26.1
Illinois                              642.6                 460.7               –28.3             1,091.3              877.7                –19.6
Indiana                               142.6                 116.5               –18.3               372.6              302.0                –18.9
Iowa                                   86.1                  65.2               –24.3               174.6              134.4                –23.0
Kansas                                 63.8                  34.1               –46.6               167.5              116.3                –30.6
Kentucky                              172.2                 115.8               –32.8               472.6              398.9                –15.6
Louisiana                             228.1                 122.6               –46.3               644.1              526.3                –18.3
Maine                                  53.9                  38.4               –28.8               129.6              110.2                –15.0
                                                                                                                                       (continued)


                                            Page 30                                               GAO/RCED-99-185 Food Stamp Participation
                                          Appendix II
                                          Changes in Participation Among Selected
                                          Food Stamp Populations




Participants in thousands
                                   AFDC/TANF participantsa                                  Food stamp participants
State                       August 1996       August 1998 Percent change            August 1996    August 1998 Percent change
Maryland                          194.1               111.6            –42.5              364.6            307.4             –15.7
Massachusetts                     226.0               165.6            –26.7              367.8            275.4             –25.1
Michigan                          502.4               315.9            –37.1              906.3            743.6             –18.0
Minnesota                         169.7               145.1            –14.5              287.5            217.9             –24.2
Mississippi                       123.8                47.7            –61.5              447.7            312.4             –30.2
Missouri                          222.8               141.3            –36.6              539.7            403.1             –25.3
Montana                            29.1                20.1            –30.9               69.2             60.8             –12.1
Nebraska                           38.6                35.9             –7.0              101.0             96.1               –4.9
Nevada                             34.3                24.7            –28.0               93.8             66.2             –29.4
New Hampshire                      22.9                14.5            –36.7               50.2             35.3             –29.7
New Jersey                        275.6               186.1            –32.5              530.3            403.0             –24.0
New Mexico                         99.7                77.5            –22.3              231.4            178.0             –23.1
New York                        1,144.0               872.1            –23.8            2,060.5          1,604.8             –22.1
North Carolina                    267.3               166.1            –37.9              605.2            506.4             –16.3
North Dakota                       13.1                 8.5            –35.1               38.4             33.7             –12.2
Ohio                              549.3               323.3            –41.1              988.0            684.9             –30.7
Oklahoma                           96.2                59.0            –38.7              337.8            283.7             –16.0
Oregon                             78.4                44.6            –43.1              279.8            223.4             –20.2
Pennsylvania                      531.1               352.3            –33.7            1,088.3            877.1             –19.4
Rhode Island                       56.6                54.2             –4.2               93.5             55.9             –40.2
South Carolina                    114.3                54.7            –52.1              359.8            324.3               –9.9
South Dakota                       15.9                 9.4            –40.9               49.3             45.1               –8.5
Tennessee                         254.8               148.5            –41.7              627.5            527.3             –16.0
Texas                             649.0               349.6            –46.1            2,260.1          1,510.2             –33.2
Utah                               39.1                28.0            –28.4              107.2             89.0             –17.0
Vermont                            24.3                19.2            –21.0               54.1             28.1             –48.1
Virginia                          152.8                95.6            –37.4              525.9            374.5             –28.8
Washington                        268.9               194.9            –27.5              487.3            339.0             –30.4
West Virginia                      89.0                37.8            –57.5              293.1            257.2             –12.2
Wisconsin                         148.9                35.5            –76.2              262.0            174.0             –33.6
Wyoming                            11.4                 1.9            –83.3               31.6             23.9             –24.4
District of Columbia               69.3                54.4            –21.5               90.1             81.7               –9.3
Guam                                8.3                 7.0            –15.7               18.2             17.2               –5.5
                                                                                               b                b                     b
Puerto Rico                       151.0               119.2            –21.1
Virgin Islands                      4.9                 4.4            –10.2               23.1             16.5             –28.6
Total                          12,241.5             8,105.8            –33.8           24,911.8         18,911.7             –24.1

                                                                                                          (Table notes on next page)



                                          Page 31                                        GAO/RCED-99-185 Food Stamp Participation
                                          Appendix II
                                          Changes in Participation Among Selected
                                          Food Stamp Populations




                                          Note: Columns may not add because of rounding.
                                          a
                                           The 1996 Welfare Reform Act replaced the Aid to Families with Dependent Children (AFDC)
                                          program with the Temporary Assistance for Needy Families (TANF) block grant.
                                          b
                                          Data unavailable because Puerto Rico receives block grant funding.

                                          Source: FNS and the Administration for Children and Families, Department of Health and Human
                                          Services.



Table II.4: Food Stamp Participation by
TANF Participants and Non-TANF            Participants in thousands
Participants, Fiscal Years 1996-97        Characteristic of                       Fiscal year             Fiscal year
                                          participants                                  1996                    1997          Difference
                                          TANF recipients                               12,459                 10,649                –1,810
                                          Non-TANF recipients                           13,466                 12,468                 –998
                                          Source: FNS, Characteristics of Food Stamp Households, for fiscal years 1996-97.



Table II.5: Age Distribution of Food
Stamp Participants, Fiscal Years          Participants in thousands
1989-97                                                                                           Age distribution
                                                                                       0 to 17                18 to 59          60 years
                                          Fiscal year                                   years                   years          and older
                                          1989                                           9,442                  7,621                 1,561
                                          1990                                          10,139                  8,244                 1,574
                                          1991                                          11,960                  9,396                 1,623
                                          1992                                          13,364                 10,698                 1,704
                                          1993                                          14,211                 11,498                 1,870
                                          1994                                          14,407                 11,615                 1,955
                                          1995                                          13,879                 11,117                 1,923
                                          1996                                          13,212                 10,782                 1,895
                                          1997                                          11,868                  9,384                 1,834
                                          Note: Children are defined as individuals who are 0-17 years old.

                                          Source: FNS, Characteristics of Food Stamp Households, for fiscal year 1997.




                                          Page 32                                             GAO/RCED-99-185 Food Stamp Participation
                                     Appendix II
                                     Changes in Participation Among Selected
                                     Food Stamp Populations




Table II.6: Number of Children Who
Received Food Stamps, by State,      Participants in thousands
Fiscal Years 1995-97                                        Fiscal year        Fiscal year     Fiscal year Percent change
                                     State                        1995               1996            1997     (FY 1995-97)
                                     Alabama                        281               273             240            –14.6
                                     Alaska                          24                27               25              4.2
                                     Arizona                        284               233             219            –22.9
                                     Arkansas                       133               136             125             –6.0
                                     California                   2,035             2,042            1,808           –11.2
                                     Colorado                       126               125             112            –11.1
                                     Connecticut                    128               107             107            –16.4
                                     Delaware                        28                30               28              0.0
                                     Florida                        720               715             600            –16.7
                                     Georgia                        421               422             368            –12.6
                                     Hawaii                          61                53               62              1.6
                                     Idaho                           41                40               36           –12.2
                                     Illinois                       581               545             528             –9.1
                                     Indiana                        219               188             161            –26.5
                                     Iowa                            93                84               79           –15.1
                                     Kansas                          99                88               76           –23.2
                                     Kentucky                       224               212             203             –9.4
                                     Louisiana                      385               362             298            –22.6
                                     Maine                           53                51               51            –3.8
                                     Maryland                       206               200             186             –9.7
                                     Massachusetts                  232               190             181            –22.0
                                     Michigan                       490               460             426            –13.1
                                     Minnesota                      163               152             121            –25.8
                                     Mississippi                    250               220             188            –24.8
                                     Missouri                       292               276             241            –17.5
                                     Montana                         34                37               32            –5.9
                                     Nebraska                        53                52               51            –3.8
                                     Nevada                          56                52               44           –21.4
                                     New Hampshire                   28                27               22           –21.4
                                     New Jersey                     284               282             250            –12.0
                                     New Mexico                     126               125             110            –12.7
                                     New York                       951               964             892             –6.2
                                     North Carolina                 300               304             276             –8.0
                                     North Dakota                    19                17               19              0.0
                                     Ohio                           575               488             404            –29.7
                                     Oklahoma                       187               164             157            –16.0
                                                                                                                (continued)


                                     Page 33                                       GAO/RCED-99-185 Food Stamp Participation
                                     Appendix II
                                     Changes in Participation Among Selected
                                     Food Stamp Populations




                                     Participants in thousands
                                                               Fiscal year         Fiscal year               Fiscal year Percent change
                                     State                           1995                1996                      1997     (FY 1995-97)
                                     Oregon                             139                 131                     112           –19.4
                                     Pennsylvania                       536                 513                     470           –12.3
                                     Rhode Island                         50                    48                   45           –10.0
                                     South Carolina                     199                 191                     182             –8.5
                                     South Dakota                         28                    24                   25           –10.7
                                     Tennessee                          315                 284                     272           –13.7
                                     Texas                             1,406              1,320                   1,192           –15.2
                                     Utah                                 65                    58                   55           –15.4
                                     Vermont                              30                    27                   22           –26.7
                                     Virginia                           276                 261                     232           –15.9
                                     Washington                         249                 247                     206           –17.3
                                     West Virginia                      124                 124                     114             –8.1
                                     Wisconsin                          186                 159                     130           –30.1
                                     Wyoming                              19                    17                   15           –21.1
                                     District of
                                     Columbia                             52                    48                   50             –3.8
                                     Guam                                 10                    10                   12             20.0
                                     Virgin Islands                       15                    15                   12           –20.0
                                     Total                           13,882              13,214                  11,871           –14.5

                                     Note: Columns may not add because of rounding.

                                     Source: FNS, Characteristics of Food Stamp Households, for fiscal years 1995-97.



Table II.7: Number of School-Age
Children Receiving Food Stamps       Children in thousands
Compared With the Number of          Type of             Fiscal year     Fiscal year      Fiscal year          Fiscal year      Percent
Children Receiving Free Lunches in   assistance                1994            1995             1996                 1997       change
School, Fiscal Years 1994-97
                                     School-age
                                     children
                                     receiving food
                                     stamps                    9,558            8,784                8,399           7,825        –18.1
                                     Children
                                     receiving free
                                     lunches at
                                     school                   12,191           12,492            12,657             12,973           6.4
                                     Note: School-age children are defined as 5-17 years old.

                                     Source: FNS, Office of Analysis and Evaluation, and Characteristics of Food Stamp Households,
                                     for fiscal years 1994-97.




                                     Page 34                                            GAO/RCED-99-185 Food Stamp Participation
Appendix III

FNS’ Program Access Reviews Reveal
Barriers to Participation

                During the past year, FNS regional offices have reviewed access to the
                Food Stamp Program in New York, Oregon, and Wisconsin in response to
                complaints from advocacy groups and a Member of Congress. Each of
                these reviews identified barriers that have made the program less
                accessible to eligible people.


                In March 1998, New York City began converting welfare offices to job
New York City   centers. The job centers were designed to reduce dependency on
                government services by diverting potential applicants from government
                programs by requiring them to find employment or other, private sources
                of assistance. For example, to be eligible for TANF and food stamps,
                applicants first had to search extensively for a job and explore alternative
                resources, such as private food pantries, family, or friends. In
                November 1998, FNS launched a review of access to New York City’s Food
                Stamp Program after receiving complaints from advocacy groups that
                needy individuals were not being given the opportunity to apply for food
                stamps during their first visit to a job center.

                FNS’ review of two New York City job centers found many barriers to
                access, including impediments to the timely processing of applications, the
                imposition of eligibility standards not authorized under the Food Stamp
                Act, and a lack of effective oversight of local districts’ operations by the
                state agency. In particular, FNS found that New York City violated federal
                law because caseworkers (1) did not permit households to apply for food
                stamps during their first visit, (2) did not inform applicants about the
                availability of food stamps if the applicants either were denied TANF
                benefits or accepted a diversion payment,1 and (3) frequently denied food
                stamp benefits to applicants for failure to participate in a job center’s
                employment-related activities or Eligibility Verification Reviews. In
                addition, the food stamp director of FNS’ Northeast regional office told us
                that job center staff were informing applicants that expedited food stamps
                were no longer available, refusing to accept food stamp applications
                because it was “too late” in the day, and encouraging applicants to
                withdraw their food stamp applications. Because these policies violate the
                Food Stamp Act, FNS ordered New York to submit a corrective action plan
                to resolve the identified problems. In response, New York State and New
                York City officials have stated that some job center practices help end
                government dependency, prevent fraud, and protect applicants’ rights.
                According to FNS, New York City officials believe they have the right to

                1
                 New York City’s job centers included a brochure explaining food stamp eligibility in their application
                packages, which were made available only after applicants returned for a second visit. In contrast,
                Alaska has mailed food stamp notices to many households.



                Page 35                                               GAO/RCED-99-185 Food Stamp Participation
                   Appendix III
                   FNS’ Program Access Reviews Reveal
                   Barriers to Participation




                   interpret the Welfare Reform Act for themselves and develop policies and
                   procedures on the basis of their interpretations because FNS has not issued
                   regulations that implement the Welfare Reform Act’s revisions.
                   Nevertheless, New York State submitted a corrective action plan that FNS
                   concluded was generally responsive to its findings; however, FNS notified
                   New York State officials that if the corrective action plan was not
                   implemented by May 1999, it would institute a fine of $5 million every 3
                   months. In April 1999, New York City officials implemented New York
                   State’s corrective action plan, addressing FNS’ concerns.

                   To reduce their welfare rolls, 22 states, including New York, are currently
                   using diversion payments, or onetime, lump-sum cash payments, which are
                   designed to keep people off welfare by eliminating their need for
                   assistance. While accepting a diversion payment disqualifies an applicant
                   from the TANF program for a specified time, it does not affect the
                   applicant’s food stamp eligibility, and the states have a legal obligation to
                   inform applicants that they can still apply for food stamps. All 22 states
                   reported that they have procedures in place for ensuring that qualified
                   applicants are told of their right to apply for food stamps. However, FNS
                   found that applicants in New York City’s job centers were not being told of
                   the availability of food stamps if they accepted a diversion payment.


                   In December 1998, FNS reviewed clients’ access to the Food Stamp
Portland, Oregon   Program at three Portland-area offices after an advocacy group
                   complained that food stamp applicants’ rights were being violated. FNS
                   found that the offices’ procedures could hinder participation by forcing
                   food stamp applicants to return on a second day before meeting with an
                   eligibility worker. During its on-site review, FNS found that food stamp
                   applicants and current participants could make an appointment to meet
                   with a food stamp eligibility worker to apply or seek recertification for
                   food stamps only between 7:30 a.m. and 8:30 a.m. (The office would give
                   an application to an applicant arriving after 8:30 a.m. but would ask the
                   applicant to return on another day for an appointment.) FNS observed that
                   more applicants were showing up during this 1-hour period than could
                   possibly be served in a single day. Hence, an applicant could wait all day,
                   only to be told at the close of business to return on another day. FNS
                   ordered Oregon to submit a corrective action plan that outlined how this
                   situation and other identified problems would be resolved. Although
                   Oregon officials questioned some of FNS’ findings and recommendations,
                   they submitted a corrective action plan that addressed FNS’ concerns.




                   Page 36                                GAO/RCED-99-185 Food Stamp Participation
                       Appendix III
                       FNS’ Program Access Reviews Reveal
                       Barriers to Participation




                       Wisconsin has privatized 13 welfare centers, including 6 centers in
Milwaukee, Wisconsin   Milwaukee that serve Wisconsin’s TANF and Food Stamp programs. In the
                       privatized centers, various nonprofit and for-profit organizations
                       administer the TANF program while county employees administer the Food
                       Stamp Program. In March 1999, FNS reviewed participants’ access to the
                       privatized welfare centers after receiving a letter from a Member of the
                       Congress, who expressed concern that the efforts to divert TANF applicants
                       may also limit clients’ access to the Food Stamp Program.

                       Although FNS found that some practices violated federal regulations, it did
                       not find that applicants were being intentionally diverted from applying for
                       food stamps in the two centers reviewed. However, FNS observed that
                       diversion might be occurring unintentionally because staff at the centers
                       were not (1) informing clients of their right to file a food stamp application
                       on the day of their first contact with the office and (2) providing a food
                       stamp application to those who asked for one. In addition, clients’ work
                       schedules were not taken into account when recertification interviews
                       were scheduled, and one center did not accept food stamp applications
                       after 4 p.m.

                       Furthermore, the centers did not make informational brochures on the
                       Food Stamp Program readily available and did not display posters
                       outlining food stamp applicants’ rights. According to FNS officials, when
                       these signs are posted in welfare centers, applicants have an opportunity
                       to read about their rights as food stamp applicants and obtain telephone
                       numbers to use if they believe they are being treated unfairly. Five of
                       seven food stamp directors in FNS’ regional offices believe the signs are
                       helpful for ensuring that food stamp applicants know and understand their
                       rights. FNS officials stated that while FNS cannot require that welfare
                       centers post signs to inform applicants of their rights, FNS has the authority
                       to require that welfare centers find alternative means of providing
                       information to applicants about their rights if posters are not used.2 In a
                       February 5, 1999, letter, FNS told New York State that it must “post signs
                       or make available other advisory materials explaining an applicant’s right
                       to file and the application processing procedures. . . .” USDA’s Office of
                       General Counsel concurred with this statement.




                       2
                        In Apr. 1999, FNS implemented a toll-free 800 number that customers can call to receive information
                       about the Food Stamp Program.



                       Page 37                                             GAO/RCED-99-185 Food Stamp Participation
Appendix IV

States Reviewed by FNS Concerning
Participants’ Access to Food Stamp
Benefits, Fiscal Years 1997-99

              State            Fiscal year 1997   Fiscal year 1998   Fiscal year 1999
                                                                                    b
              Alabama                                           X
                                                                                    a
              Alaska                         X
                                                                                    b
              Arizona
                                                                                    b
              Arkansas                       X                  X
                                                                                    b
              California                     X                  X
              Colorado                       X                  X                  X
              Connecticut                                       X                  X
                                                                                    b
              Delaware
              Florida                                           X                  X
                                                                                    b
              Georgia                                           X
              Hawaii                         X
                                                                                    b
              Idaho                          X
              Illinois
              Indiana
                                                                                    b
              Iowa                           X                  X
              Kansas                         X                  X                  X
              Kentucky                                          X
              Louisiana                      X                  X                  X
              Maine                                             X
              Maryland                                                             X
              Massachusetts                                     X
              Michigan
              Minnesota
              Mississippi                                       X
                                                                                    b
              Missouri                       X                  X
              Montana                        X                  X                  X
              Nebraska                       X                  X                  X
              Nevada                                                               X
              New Hampshire                                     X
                                                                                    b
              New Jersey                     X
                                                                                    b
              New Mexico                     X                  X
              New York                                                             X
                                                                                    b
              North Carolina                                    X
                                                                                    b
              North Dakota                   X                  X
              Ohio
                                                                                    b
              Oklahoma                       X                  X
              Oregon                         X                                     Xc
                                                                                    b
              Pennsylvania                                      X
                                                                          (continued)


              Page 38                        GAO/RCED-99-185 Food Stamp Participation
Appendix IV
States Reviewed by FNS Concerning
Participants’ Access to Food Stamp
Benefits, Fiscal Years 1997-99




State                             Fiscal year 1997        Fiscal year 1998        Fiscal year 1999
Rhode Island                                                                X
South Carolina                                                              X
                                                                                                      b
South Dakota                                         X                      X
Tennessee                                                                   X
                                                                                                      b
Texas                                                X                      X
Utah                                                 X                      X                        X
Vermont
                                                                                                      b
Virginia
Washington                                                                  X                        X
                                                                                                      b
West Virginia                                        X                      X
Wisconsin                                                                                            Xc
                                                                                                      b
Wyoming                                              X                      X
                                                                                                      b
District of Columbia
Total                                              22                      32                        14

a
 The FNS regional office has yet to determine what functional areas will be included in reviews of
the states’ operations.
b
FNS regional offices plan to review program access in these states.
c
 FNS conducted program access reviews in Oregon and Wisconsin in response to complaints
during fiscal year 1999.

Source: FNS regional offices.




Page 39                                              GAO/RCED-99-185 Food Stamp Participation
Appendix V

Comments From New York State


Note: GAO comments
supplementing those in the
report text appear at the
end of this appendix.




See comment 1.




See comment 2.




                             Page 40   GAO/RCED-99-185 Food Stamp Participation
                 Appendix V
                 Comments From New York State




See comment 3.




See comment 4.




                 Page 41                        GAO/RCED-99-185 Food Stamp Participation
                 Appendix V
                 Comments From New York State




See comment 5.




See comment 6.




                 Page 42                        GAO/RCED-99-185 Food Stamp Participation
                 Appendix V
                 Comments From New York State




                 The following are GAO’s comments on New York State’s letter dated
GAO’s Comments   June 16, 1999.

                 1. This report does not discuss participation in individual states.

                 2. This point is clarified on page 12 of the report.

                 3. This point is clarified on page 13 of the report.

                 4. This point is clarified on page 13 of the report.

                 5. This report does not discuss individual states’ perceptions of the role of
                 the Food Stamp Program.

                 6. We disagree. The three USDA reviews discussed in this report identified
                 barriers that have made the Food Stamp Program less accessible for
                 eligible people.




                 Page 43                                  GAO/RCED-99-185 Food Stamp Participation
Appendix VI

Comments From Wisconsin




              Page 44     GAO/RCED-99-185 Food Stamp Participation
Appendix VI
Comments From Wisconsin




Page 45                   GAO/RCED-99-185 Food Stamp Participation
Appendix VII

GAO Contacts and Staff Acknowledgments


                  Lawrence J. Dyckman (202) 512-5138
GAO Contacts      Richard Cheston (202) 512-5138


                  In addition to those named above, Carl Christian, Nikki Clowers, Donald
Acknowledgments   Ficklin, and Luann Moy made key contributions to this report.




(150079)          Page 46                               GAO/RCED-99-185 Food Stamp Participation
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