[Congressional Record (Bound Edition), Volume 153 (2007), Part 9]
[House]
[Page 13234]
[From the U.S. Government Publishing Office, www.gpo.gov]




                 DAY THREE OF THE FOOD STAMP CHALLENGE

  (Mr. McGOVERN asked and was given permission to address the House for 
1 minute and to revise and extend his remarks.)
  Mr. McGOVERN. Madam Speaker, today is the third day of my week on the 
Food Stamp Challenge, where public officials live for 1 week on a food 
stamp budget in order to raise awareness about the Food Stamp Program. 
Representatives Jo Ann Emerson, Tim Ryan, and Jan Schakowsky are also 
taking part.
  Although critics of the Food Stamp Program frequently speculate that 
it runs rampant with fraud, waste, and abuse, this is simply and 
utterly untrue. Don't just take my word for it. Go ask the Government 
Accountability Office. According to the GAO, the Food Stamp program 
currently operates at historically low error rates. Between 1999 and 
2005, the national payment error rate declined 40 percent to an all-
time low of 5.84 percent. In addition, there are incentives built into 
the program so that States are rewarded for low error rates and may be 
fined if they are underperforming.
  By any measure the Food Stamp Program is an example of an efficiently 
run government program. I will insert into the Record the highlights of 
the GAO testimony before the Senate on payment errors and trafficking.

                    [From Highlights, Jan. 31, 2007]

                           Food Stamp Program


                         Why GAO Did This Study

       The U.S. Department of Agriculture's (USDA) Food Stamp 
     Program is intended to help low-income individuals and 
     families obtain a better diet by supplementing their income 
     with benefits to purchase food. USDA's Food and Nutrition 
     Service (FNS) and the states jointly implement the Food Stamp 
     Program, which is to be authorized when it expires in fiscal 
     year 2007. This testimony discusses our past work on two 
     issues related to ensuring integrity of the program: (1) 
     improper payments to food stamp participants, and (2) 
     trafficking in food stamp benefits.
       This testimony is based on a May 2005 report on payment 
     errors (GAO-05-245) and an October 2006 report on trafficking 
     (GAO-07-53). For the payment error report, GAO analyzed 
     program quality control data and interviewed program 
     stakeholders, including state and local officials. For the 
     trafficking report, GAO interviewed agency officials, visited 
     field offices, conducted case file reviews, and analyzed data 
     from the FNS retailer database.


                             What GAO Found

       The national payment error rate for the Food Stamp Program 
     combines states' overpayments and underpayments to program 
     participants and has declined by about 40 percent between 
     1999 and 2005, from 9.86 percent to a record low of 5.84 
     percent, due in part to options made available to states that 
     simplified program reporting rules. In 2005, the program made 
     payment errors totaling about $1.7 billion. However, if the 
     1999 error rate was in effect in 2005, program payment errors 
     would have been $1.1 billion higher. FNS and the states we 
     reviewed have taken several steps to improve food stamp 
     payment accuracy, most of which are consistent with internal 
     control practices known to reduce improper payments. These 
     include practices to improve accountability, perform risk 
     assessments, implement changes based on such assessments, and 
     monitor program performance.
       FNS estimates indicate that the national rate of food stamp 
     trafficking declined from about 3.8 cents per dollar of 
     benefits redeemed in 1993 to about 1.0 cent per dollar during 
     the years 2002 to 2005 and that trafficking occurs more 
     frequently in smaller stores. FNS has taken advantage of 
     electronic benefit transfer and other new technology to 
     improve its ability to detect trafficking and disqualify 
     retailers who traffic. Law enforcement agencies have 
     investigated and referred for prosecution a decreasing number 
     of traffickers; they are instead focusing their efforts on 
     fewer high-impact investigations. Despite the progress FNS 
     has made in combating retailer trafficking, the Food Stamp 
     Program remains vulnerable because retailers can enter the 
     program intending to traffic and do so, often without fear of 
     severe criminal penalties, as the declining number of 
     investigations referred for prosecution suggests.
       While both payment errors and trafficking of benefits have 
     declined in a time of rising participation, ensuring program 
     integrity remains a fundamental challenge facing the Food 
     Stamp Program. To reduce program vulnerabilities and ensure 
     limited compliance-monitoring resources are used efficiently, 
     GAO recommended in its October 2006 trafficking report that 
     FNS take additional steps to target and provide early 
     oversight of stores most likely to traffic; develop a 
     strategy to increase penalties for trafficking, working with 
     the Inspector General as needed; and promote state efforts to 
     pursue recipients suspected of trafficking. FNS generally 
     agreed with GAO's findings, conclusions, and recommendations. 
     However, FNS believes it does have a strategy for targeting 
     resources through their use of food stamp transaction data to 
     identify suspicious transaction patterns. GAO believes that 
     FNS has made good progress in its use of these transaction 
     data; however, it is now at a point where it can begin to 
     formulate more sophisticated analyses.

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