[Federal Register Volume 89, Number 232 (Tuesday, December 3, 2024)]
[Proposed Rules]
[Pages 95724-95727]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-27853]
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Proposed Rules
Federal Register
________________________________________________________________________
This section of the FEDERAL REGISTER contains notices to the public of
the proposed issuance of rules and regulations. The purpose of these
notices is to give interested persons an opportunity to participate in
the rule making prior to the adoption of the final rules.
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Federal Register / Vol. 89, No. 232 / Tuesday, December 3, 2024 /
Proposed Rules
[[Page 95724]]
DEPARTMENT OF AGRICULTURE
Food and Nutrition Service
7 CFR Part 273
[FNS-2024-0029]
RIN 0584-AF04
Supplemental Nutrition Assistance Program: Thrifty Food Plan Cost
Adjustment for the Price of Food in Hawaii
AGENCY: Food and Nutrition Service (FNS), USDA.
ACTION: Proposed rule.
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SUMMARY: The Food and Nutrition Service (FNS) is proposing changes to
Supplemental Nutrition Assistance Program (SNAP) regulations in
accordance with the Food and Nutrition Act of 2008, which calls for a
cost adjustment in the Thrifty Food Plan (TFP) for Hawaii to reflect
the cost of food in Hawaii. The proposal would update the method for
calculating this cost adjustment to incorporate food prices from
throughout the State of Hawaii rather than from Honolulu alone,
ensuring that SNAP benefit allotments better reflect food prices faced
by participants throughout the State of Hawaii.
DATES: Written comments must be received on or before February 3, 2025
to be assured of consideration.
ADDRESSES: The Food and Nutrition Service, USDA, invites interested
persons to submit written comments on this proposed rule. Comments may
be submitted in writing by one of the following methods:
Federal eRulemaking Portal: Go to http://www.regulations.gov. Follow the online instructions for submitting
comments.
Mail: Send comments to Kevin Meyers Mathieu, Economic
Advisor, Nutrition Guidance and Analysis Division, Center for Nutrition
Policy and Promotion, Food and Nutrition Service, U.S. Department of
Agriculture, 1320 Braddock Place, Fourth Floor, Alexandria, VA 22314.
Website: Go to http://www.regulations.gov. Follow the
online instructions for submitting comments.
Email: Send comments to [email protected].
All written comments submitted in response to this
proposed rule will be included in the record and will be made available
to the public. Please be advised that the substance of the comments and
the identity of the individuals or entities submitting the comments
will be subject to public disclosure. FNS will make the written
comments publicly available on the internet via http://www.regulations.gov.
FOR FURTHER INFORMATION CONTACT: Kevin Meyers Mathieu, Economic
Advisor, Nutrition Guidance and Analysis Division, Center for Nutrition
Policy and Promotion, Food and Nutrition Service, U.S. Department of
Agriculture, 1320 Braddock Place, Fourth Floor, Alexandria, VA 22314,
703-946-7619 or [email protected].
SUPPLEMENTARY INFORMATION:
Background
The Thrifty Food Plan (TFP) is one of four Food Plans the
Department of Agriculture (USDA or the Department) develops that
estimates the cost of a healthy diet across various price points--the
Thrifty, Low-Cost, Moderate-Cost and Liberal Food Plans. The TFP is the
lowest cost of the four and represents a nutritious, practical, and
cost-effective diet. The foundation of the TFP is a set of market
baskets applicable to various age-sex groups that outline nutrient-
dense foods and beverages, their amounts, and associated costs that can
be purchased on a limited budget to support a healthy diet through
nutritious meals and snacks at home. The cost of the TFP is based on a
reference family of four, defined by the Food and Nutrition Act of 2008
(the Act) (7 U.S.C. 2012(u)) as consisting of a man and a woman twenty
through fifty, a child six through eight, and a child nine through
eleven years of age.
The TFP is used to determine Supplemental Nutrition Assistance
Program (SNAP) benefit amounts. The Act (7 U.S.C. 2012(u)(4)) requires
the cost of the TFP in June to serve as the basis for setting maximum
SNAP benefit allotments in the following Federal fiscal year (October 1
through September 30). SNAP allotments for households of different
sizes are calculated proportional to the allotments for the reference
family of four with economies-of-scale adjustments.
The Act (7 U.S.C. 2012(u)(2)) also calls for cost adjustments to
the TFP to reflect the cost of food in Hawaii. Requirements at 7 CFR
273.10(e)(4)(i) further specify that this cost adjustment reflect the
price of food in Honolulu. The calculation and implementation of this
cost adjustment are separate from the reevaluation of the TFP market
basket; the cost adjustment is not required to be updated when the TFP
market basket is reevaluated every five years. The extent of regional
food price variation may vary across different foods and beverages. As
a result, changes to the underlying TFP market basket resulting from
the required 2021 TFP reevaluation present an opportunity to update the
cost adjustment for Hawaii. Although not required, updating the cost
adjustment for Hawaii following the TFP reevaluation is intended to
maintain equivalence between the purchasing power of SNAP benefit
allotments in Hawaii and in the mainland United States.
Beginning in the early 1970s, TFP costs for Hawaii were calculated
as the cost of the TFP in the contiguous 48 States and the District of
Columbia (hereafter referred to as the ``mainland United States'')
adjusted for the price of food in Honolulu. Evidence suggests that
Honolulu was used as the basis for the original price-of-food
adjustments because it was the only location in Hawaii where the Bureau
of Labor Statistics (BLS) routinely collected food price information.
FNS subsequently used BLS food price information collected for the
Consumer Price Index (CPI) as the basis for the TFP cost for Hawaii
through 1977.
In 1978, BLS made major changes in the methods for collecting food
price data in the United States, thereby hindering the construction of
price-of-food adjustments for Honolulu using BLS data. With the need
for an alternate data source, FNS incorporated data collected in Hawaii
from the 1977-1978 Nationwide Food Consumption Survey (NFCS) into a
reevaluation of the TFP in the early 1980s. The NFCS-based
[[Page 95725]]
Hawaii TFP cost was subsequently updated for inflation using the
semiannual CPIs for Urban Hawaii through June 2021.
As directed by Congress in the Agricultural Improvement Act of
2018, FNS published an evidence-driven reevaluation of the TFP to
reflect current food prices, food composition data, consumption
patterns, and dietary guidance. The reevaluation, published in August
2021,\1\ defined the content of the TFP market baskets for 15 age-sex
groups, as well as their costs in the mainland United States. After
accounting for inflation, the reevaluation led to a 21.03 percent
increase in the TFP cost for the mainland United States.
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\1\ https://www.fns.usda.gov/cnpp/thrifty-food-plan-2021.
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FNS used the 21.03-percent increase in the inflation-adjusted cost
of the TFP in the mainland United States associated with the 2021 TFP
reevaluation as the basis for a temporary adjustment to the TFP cost
for Hawaii beginning in June 2021. The application of the temporary
adjustment effectively held the cost adjustment for Hawaii (i.e., the
percentage difference between the TFP cost for Hawaii and the TFP cost
for the mainland United States) constant despite the change in
underlying market baskets. This TFP cost for Hawaii, inclusive of the
temporary adjustment, was subsequently adjusted for inflation to
reflect June 2022 price levels using the CPIs for Urban Hawaii while
FNS conducted additional analysis of the TFP cost for Hawaii.
In July 2023, FNS published the Thrifty Food Plan Cost Estimates
for Alaska and Hawaii report,\2\ which calculated a TFP cost estimate
for Hawaii based on the most current information available. The report
detailed the identification of a data source and the development and
application of a price index to these data in alignment with the
statutory and regulatory framework. The report was peer reviewed by
experts at USDA as well as six researchers outside of the Federal
Government with demonstrated knowledge and expertise in price indexes,
scanner data, and the TFP. The report provides detailed information on
the four existing price indexes and the four existing food price data
sources that FNS considered, as well as FNS' approach for evaluating
each option. FNS identified Circana (formerly Information Resources
Inc., or IRI) retail scanner data as the best available data to support
the calculation of new TFP cost estimates based on sample size;
applicability to the TFP, 2021; data quality and documentation;
appropriateness as a price-of-food adjustment; and the applicability to
future updates and reevaluations. FNS used Circana retail scanner data
from over 40,000 stores in the mainland United States and 32 stores in
Honolulu, including sales at these stores for over 11,000 unique food
and beverage products, to calculate an updated TFP cost estimate for
Hawaii using a bilateral, fixed-basket price index. FNS used this
index-based approach to calculate an updated TFP cost for Hawaii rather
than the optimization model approach used to conduct TFP reevaluations
because the use of an optimization model would have resulted in the
creation of a new market basket, which would not align with the Act (7
U.S.C. 2012(u)(2)), which calls for an adjustment for the cost of food,
exclusively. The analysis resulted in an updated estimate of the
percent difference in the cost of purchasing the foods and beverages in
the TFP, 2021 market basket between Honolulu and the mainland United
States, which was applied to the cost of the TFP in the mainland United
States to yield an updated TFP cost estimate for Hawaii. FNS is
currently transitioning to using the updated TFP cost estimate for
Hawaii published in the 2023 report as the basis of the maximum SNAP
allotment in Hawaii.
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\2\ https://www.fns.usda.gov/cnpp/tfp-akhi.
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On January 19, 2024, FNS posted a Request for Information (RFI) in
the Federal Register (89 FR 3633) requesting comments from the public--
including the food industry and research community--to help inform
future policy and decisions about potentially updating TFP cost
estimates for the State of Hawaii. Concurrent with its publication, FNS
conducted extensive outreach to stakeholders in Hawaii to spread
awareness of and encourage responses to the RFI, including by notifying
national and local organizations, universities, Federal agencies, and
every SNAP-approved retailer in the State for which SNAP had a valid
email address (approximately 510 retailers). The comment period closed
on March 4, 2024, with FNS receiving a total of 12 comments from a
Federal agency, an academic, a SNAP participant, three advocacy/non-
profit organizations, an industry association, three retailers (with
one retailer providing two comments), and one anonymous respondent.
The comments consistently indicated that food prices are higher in
the Neighbor Islands than in Honolulu. A key rationale for the higher
relative prices in the Neighbor Islands provided by the comments is
that nearly all foods and beverages sold in Hawaii are imported from
out of State, with these shipments first arriving in Honolulu and then
being distributed out to the Neighbor Islands. This additional
distribution step adds to the cost of foods and beverages in the
Neighbor Islands which is then reflected in retail prices. Several
comments suggested that many residents of the Neighbor Islands in rural
and remote areas of the State do not live in proximity to club stores,
which tend to offer lower unit prices for foods and beverages purchased
in larger quantities. While club stores operate in urban areas on the
Neighbor Islands, the comments noted that not all residents of the
Neighbor Islands are able to consistently access these stores.
The comments also consistently expressed that a TFP cost for the
State of Hawaii based on data from Honolulu alone underestimates the
true cost of a healthy, practical, cost-effective diet in the State.
Therefore, the respondents argued, current SNAP regulations that adjust
for the cost of food in Honolulu lead to an inequitable maximum
allotment level for SNAP participants in the Neighbor Islands.
FNS proposes to revise regulations at 7 CFR 273.10(e)(4)(i) to
align with the Act (7 U.S.C. 2012(u)(2)) and base the cost of the TFP
in Hawaii on an adjustment for the price of food in the State of Hawaii
rather than an adjustment for the price of food in Honolulu.
FNS conducted analyses to develop a TFP cost estimate for Hawaii
that would align with the proposed regulatory framework using the best
currently available data on food prices. The analysis, which uses the
same peer-reviewed methodology as the original Honolulu analysis
published in 2023, is documented in a separately published scientific
report.\3\ The analysis is also based on Circana retail scanner data,
which provides sales data from the 32 stores included in FNS' original
analysis of food prices in Honolulu and 65 additional stores from
throughout the State of Hawaii. Including these additional stores also
enables the analysis to consider food prices for approximately 700 (6%)
more unique food and beverage products.
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\3\ https://www.fns.usda.gov/cnpp/statewide-tfp-hi-2024.
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The proposed changes at 7 CFR 273.10(e)(4)(i) would revise the
regulatory framework for Hawaii's TFP cost without establishing a
specific dollar value or a specific price-of-food adjustment for
Hawaii. The Hawaii TFP cost will continue to be based on the
[[Page 95726]]
best available food price data and may be updated in the future at the
Secretary's discretion. To support continuous quality advancement, FNS
continues to explore food price data sources for the State of Hawaii.
Procedural Matters
Executive Order 12866, 13563 and 14094
Executive Orders 12866, 13563, and 14094 direct agencies to assess
all costs and benefits of available regulatory alternatives and, if
regulation is necessary, to select regulatory approaches that maximize
net benefits (including potential economic, environmental, public
health and safety effects, distributive impacts, and equity). Executive
Order 13563 emphasizes the importance of quantifying both costs and
benefits, of reducing costs, of harmonizing rules, and of promoting
flexibility. This proposed rule has been determined to be not
significant and was not reviewed by the Office of Management and Budget
(OMB) in conformance with Executive Order 12866.
Regulatory Impact Analysis
This rule has been designated as not significant by the Office of
Management and Budget, therefore, no Regulatory Impact Analysis is
required.
Regulatory Flexibility Act
The Regulatory Flexibility Act (5 U.S.C. 601-612) requires Agencies
to analyze the impact of rulemaking on small entities and consider
alternatives that would minimize any significant impacts on a
substantial number of small entities. Pursuant to that review, it has
been certified that this rule would not have a significant impact on a
substantial number of small entities.
Congressional Review Act
Pursuant to the Congressional Review Act (5 U.S.C. 801 et seq.),
the Office of Information and Regulatory Affairs designated this rule
as not a `major rule', as defined by 5 U.S.C. 804(2).
Unfunded Mandates Reform Act
Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), Public
Law 104-4, establishes requirements for Federal agencies to assess the
effects of their regulatory actions on State, local and tribal
governments and the private sector. Under section 202 of the UMRA, the
Department generally must prepare a written statement, including a cost
benefit analysis, for proposed and final rules with ``Federal
mandates'' that may result in expenditures by State, local or tribal
governments, in the aggregate, or the private sector, of $100 million
or more in any one year. When such a statement is needed for a rule,
Section 205 of the UMRA generally requires the Department to identify
and consider a reasonable number of regulatory alternatives and adopt
the most cost effective or least burdensome alternative that achieves
the objectives of the rule.
This proposed rule does not contain Federal mandates (under the
regulatory provisions of Title II of the UMRA) for State, local and
tribal governments or the private sector of $100 million or more in any
one year. Thus, the rule is not subject to the requirements of sections
202 and 205 of the UMRA.
Executive Order 12372
This Supplemental Nutrition Assistance Program is listed in the
Catalog of Federal Domestic Assistance under Number 10.551 and is
subject to Executive Order 12372, which requires intergovernmental
consultation with State and local officials. (See 2 CFR chapter IV.)
Federalism Summary Impact Statement
Executive Order 13132 requires Federal agencies to consider the
impact of their regulatory actions on State and local governments.
Where such actions have federalism implications, agencies are directed
to provide a statement for inclusion in the preamble to the regulations
describing the agency's considerations in terms of the three categories
called for under Section (6)(b)(2)(B) of Executive Order 13132.
The Department has considered the impact of this rule on State and
local governments and has determined that this rule does not have
federalism implications. Therefore, under section 6(b) of the Executive
Order, a federalism summary is not required.
Executive Order 12988, Civil Justice Reform
This proposed rule has been reviewed under Executive Order 12988,
Civil Justice Reform. This rule is intended to have preemptive effect
with respect to any State or local laws, regulations or policies which
conflict with its provisions or which would otherwise impede its full
and timely implementation. This rule/is not intended to have
retroactive effect unless so specified in the Effective Dates section
of the final rule. Prior to any judicial challenge to the provisions of
the final rule, all applicable administrative procedures must be
exhausted.
Civil Rights Impact Analysis
FNS has reviewed this proposed rule in accordance with USDA
Regulation 4300-4, ``Civil Rights Impact Analysis,'' to identify any
major civil rights impacts the rule might have on program participants
on the basis of age, race, color, national origin, sex or disability.
After a careful review of the rule's intent and provisions, FNS has
determined that this rule is not expected to affect the participation
of protected individuals in SNAP.
Executive Order 13175
Executive Order 13175 requires Federal agencies to consult and
coordinate with Tribes on a government-to-government basis on policies
that have Tribal implications, including regulations, legislative
comments or proposed legislation, and other policy statements or
actions that have substantial direct effects on one or more Indian
Tribes, on the relationship between the Federal Government and Indian
Tribes, or on the distribution of power and responsibilities between
the Federal Government and Indian Tribes.
We are unaware of any current Tribal laws that could be in
conflict with this rule.
Paperwork Reduction Act
The Paperwork Reduction Act of 1995 (44 U.S.C. Chap. 35; 5 CFR
1320) requires the Office of Management and Budget (OMB) approve all
collections of information by a Federal agency before they can be
implemented. Respondents are not required to respond to any collection
of information unless it displays a current valid OMB control number.
This rule does not contain information collection requirements
subject to approval by the Office of Management and Budget under the
Paperwork Reduction Act of 1994.
E-Government Act Compliance
The Department is committed to complying with the E-Government Act,
to promote the use of the internet and other information technologies
to provide increased opportunities for citizen access to Government
information and services, and for other purposes.
List of Subjects in 7 CFR Part 273
Administrative practice and procedure, Supplemental Nutrition
Assistance Program, Thrifty Food Plan.
Accordingly, 7 CFR part 273 is proposed to be amended as follows:
[[Page 95727]]
PART 273.10--DETERMINING HOUSEHOLD ELIGIBILITY AND BENEFIT LEVELS
0
1. The authority citation for part 273 continues to read as follows:
Authority: 7 U.S.C. 2011-2036.
0
2. In Sec. 273.10, amend paragraph (e)(4)(i) to remove the word
``Honolulu'' and adding in its place ``Hawaii''.
Tameka Owens,
Acting Administrator and Assistant Administrator, Food and Nutrition
Service.
[FR Doc. 2024-27853 Filed 12-2-24; 8:45 am]
BILLING CODE 3410-30-P