Food Stamp Program: Steps Have Been Taken to Increase
Participation of Working Families, but Better Tracking of Efforts
Is Needed (05-MAR-04, GAO-04-346).
Eligible working families are believed to participate in the Food
Stamp Program at a lower rate than the eligible population as a
whole. As a result, many federal, state, and local officials
believe the program is not living up to its potential as a
component of the nation's work support system. This report
examines: (1) what proportion of eligible working families
participate in the program and what family characteristics are
associated with a family's participation; (2) what factors may be
acting as impediments to a working family's decision to
participate in the program; and (3) what steps are being taken,
or have been suggested, to help eligible low-income working
families participate in the program while ensuring program
integrity.
-------------------------Indexing Terms-------------------------
REPORTNUM: GAO-04-346
ACCNO: A09407
TITLE: Food Stamp Program: Steps Have Been Taken to Increase
Participation of Working Families, but Better Tracking of Efforts
Is Needed
DATE: 03/05/2004
SUBJECT: Disadvantaged persons
Federal aid programs
Federal/state relations
Food relief programs
State-administered programs
Strategic planning
Program evaluation
Food Stamp Program
******************************************************************
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GAO-04-346
United States General Accounting Office
GAO
Report to Congressional Requesters
March 2004
FOOD STAMP PROGRAM
Steps Have Been Taken to Increase Participation of Working Families, but Better
Tracking of Efforts Is Needed
GAO-04-346
Highlights of GAO-04-346, a report to congressional requesters
Eligible working families are believed to participate in the Food Stamp
Program at a lower rate than the eligible population as a whole. As a
result, many federal, state, and local officials believe the program is
not living up to its potential as a component of the nation's work support
system. This report examines: (1) what proportion of eligible working
families participate in the program and what family characteristics are
associated with a family's participation; (2) what factors may be acting
as impediments to a working family's decision to participate in the
program; and (3) what steps are being taken, or have been suggested, to
help eligible low-income working families participate in the program while
ensuring program integrity.
GAO recommends that the Secretary of the U.S. Department of Agriculture
direct the Food and Nutrition Service to: (1) encourage states to collect
and report on the results of their outreach and other efforts to increase
participation among eligible working families and (2) disseminate the
lessons learned from those efforts to other states and localities.
www.gao.gov/cgi-bin/getrpt?GAO-04-346.
To view the full product, including the scope and methodology, click on
the link above. For more information, contact Kay Brown at (202) 512-3674
or [email protected].
March 2004
FOOD STAMP PROGRAM
Steps Have Been Taken to Increase Participation of Working Families, but Better
Tracking of Efforts Is Needed
In 2001, an estimated 52 percent of eligible individuals in working
families participated in the Food Stamp Program compared with about 70
percent of eligible members of nonworking families.
Participation Rates Are Lower for Working Families than for Nonworking
Families
Participation rate among eligibles (percentage)
80
60
40
20
0 1994 1995 1996 1997 1998 1999 2000
Year
Eligible individuals in households with earned income All eligible
individuals
Eligible individuals in households with no earnings
Source: The Food and Nutrition Service and GAO.
Participating working families are more likely to receive greater food
stamp benefit amounts than those eligible working families that do not
participate. Also, participating working families were more likely to
participate in other government assistance programs and to rent rather
than own their home.
Factors that can impede an eligible working family's participation in the
program include whether the family is aware of the program's existence and
eligibility criteria and whether a family considers the program's
administrative process-including having to make frequent trips to a food
stamp office during working hours and providing documentation of
income-overly burdensome. However, there are some potentially significant
benefits, including error and fraud prevention, to some of the
administrative requirements. Evidence also suggests that some families
weigh the perceived burdens of participation against the benefits of doing
so and perceive a stigma attached to receiving food stamps.
The Food and Nutrition Service (FNS) and several states and localities
have taken or suggested steps to address the impediments to participation
in the program for working families, while also considering ways to
balance easier participation with program integrity. These efforts include
increasing food stamp outreach, adopting new administrative processes to
ease participation and reduce program error, developing tools to help
families estimate food stamp benefit amount, and re-naming the program to
reduce the stigma associated with food stamps. Compiling a complete
picture of these steps was not possible, however, because FNS does not
systematically track these efforts, and the outcomes of their use are
still largely unknown.
Contents
Letter
Results in Brief
Background
Eligible Working Families Participate in the Food Stamp Program
at a Lower Rate than Eligible Nonworking Families Factors Related to a
Family's Awareness and Perception of the Food Stamp Program Influence
Their Participation
FNS and Some States and Localities Have Taken, or Suggested, Steps to Help
Working Families Participate in the Program While Ensuring Program
Integrity
Conclusions
Recommendations to the Secretary of Agriculture
Agency Comments
1
3 5
11
17
25 37 38 38
Appendix I Methodology for Comparing Participating Working Families to
Likely Eligible Nonparticipating Working Families 41
The Analysis Allows for Comparisons between Households with Participating
and Nonparticipating Working Families 43
Appendix II Summary of Farm Bill Provisions
Appendix III GAO Contacts and Acknowledgments 49
GAO Contacts 49 Acknowledgments 49
Related GAO Products
Tables
Table 1: Characteristics That Are Associated with the Likelihood of Food
Stamp Participation 16
Table 2: Recent FNS-Funded Outreach Activities Conducted by States, Local
Government, or Community-Based Organizations 27
Table 3: Selected Results from Prescreening Tools Used by Community-Based
Organizations 34
Table 4: Characteristics of Eligible Households with Earnings Used
as Factors to Predict Food Stamp Program Participation
(Observed N=2,498; weighted N=4,911,252) 42 Table 5: Odds Ratios
Indicating the Effects of Various Factors on
Food Stamp Participation among Eligible Earning
Households, from Bivariate and Multivariate Logistic
Regression Models (Observed N=2,498; weighted
N=4,911,252) 45
Figures
Figure 1: Families Must Go through Several Steps to Receive Food Stamps 7
Figure 2: Food Stamp Recipiency Has Increased in the Last 2 Years,
Following a Substantial Decline 8 Figure 3: More Food Stamp Recipients Now
Live in Households with Earnings than Households on TANF 11 Figure 4:
Participation Rates Are Lower for Working Families than for Nonworking
Families 13
Figure 5: Estimated Food Stamp Benefits for a Single Mother with Two
Children Based upon Varying Amounts of Monthly Income 15
Figure 6: Impediments to Participation Have the Potential to Impact Each
Step of the Food Stamp Process 18
Abbreviations
CHIP Children's Health Insurance Program
CPS Current Population Survey
EBT Electronic Benefits Transfer
EITC Earned Income Tax Credit
FSP Food Stamp Program
PRWORA Personal Responsibility and Work Opportunity
Act of 1996 QC quality control SIPP Survey of Income and Program
Participation SSI Supplemental Security Income TANF Temporary Assistance
for Needy Families USDA U.S. Department of Agriculture WIC Special
Supplemental Nutrition Program for
Women, Infants, and Children
This is a work of the U.S. government and is not subject to copyright
protection in the United States. It may be reproduced and distributed in
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separately.
United States General Accounting Office Washington, DC 20548
March 5, 2004
The Honorable Tom Harkin
Ranking Democratic Member
Committee on Agriculture, Nutrition, and Forestry
United States Senate
The Honorable Patrick J. Leahy
Ranking Minority Member
Subcommittee on Research, Nutrition,
and General Legislation
Committee on Agriculture, Nutrition and Forestry
United States Senate
The Honorable John M. Spratt, Jr.
Ranking Minority Member
Committee on the Budget
House of Representatives
The Honorable Calvin M. Dooley
Ranking Minority Member
Subcommittee on Department Operations,
Oversight, Nutrition, and Forestry
Committee on Agriculture
House of Representatives
The federal Food Stamp Program, established in 1964 and administered by
the U.S. Department of Agriculture (USDA), is designed to provide basic
nutrition to low-income individuals and families in the United States by
supplementing their income with food stamp benefits; however, many
individuals who are likely eligible to participate in the program do not.
According to USDA data, while an average of almost 16 million Americans
a month received food stamp benefits in fiscal year 2001, almost 11
million
individuals who were likely eligible to receive food stamps in September
of that year did not participate in the program. Overall, the program paid
almost $16 billion in benefits in fiscal year 2001.
Working families, defined here as those who live in households with earned
income, that are eligible to receive food stamps participate in the
program at a lower rate than the eligible population as a whole.1 As a
result, many federal, state, and local officials believe that the Food
Stamp Program is not living up to its potential as a component of the
nation's work support system. Work support programs assist low-income
working families by subsidizing some of the expenses associated with work
outside the home as well as everyday necessities. These supports have
grown in importance following 1996's welfare reform legislation, which
placed a priority on work and economic self-sufficiency. Although the Food
Stamp Program's primary mission is to ensure that low-income Americans
have access to a healthy diet, targeting food assistance to eligible
low-income working families also helps adults enter and stay in the
workforce by freeing up limited resources for other necessities.
USDA has made it a priority to increase working families' access to the
nutrition assistance they need, while at the same time ensuring that only
those who are eligible for benefits receive them. To better understand how
the Food Stamp Program serves working families, you asked us to examine:
(1) what proportion of eligible working families participate in the Food
Stamp Program and what family characteristics are associated with a
family's participation; (2) what factors may be acting as impediments to
whether a working family participates in the Food Stamp Program; and (3)
what steps are being taken, or have been suggested, to help eligible
low-income working families participate in the Food Stamp Program while
ensuring program integrity.
To answer these questions, we held discussions with program stakeholders,
including officials at USDA's Food and Nutrition Service's (FNS)
headquarters and regional offices,2 state food stamp officials,
representatives of advocacy organizations, and other program experts. We
also conducted a search of the literature to identify recent (1996 or
later) studies that specifically addressed participation in the Food Stamp
Program among eligible working families. In addition, we analyzed
simulated data prepared by Mathematica Policy Research, Inc., to produce
1A food stamp household consists of individuals who live together and
customarily purchase and prepare food in common.
2FNS oversees the program at the federal level, while each of the 50
states-plus Washington, D.C., Guam, and the Virgin Islands-administer
their own programs, either at the state or county level.
Results in Brief
program participation estimates for FNS. The simulated data are based on
the most recently available public data primarily collected by USDA and
the U.S. Census Bureau.3 Finally, we visited four states- Florida,
Massachusetts, New York, and Oregon-with programs identified by federal
officials, researchers, and other program stakeholders as having
innovative approaches to encouraging participation in the Food Stamp
Program among working families. During each of those site visits, we met
with the state officials responsible for oversight of the Food Stamp
Program, visited two local offices in different parts of the state,
interviewed advocacy groups charged with doing formal and informal food
stamp outreach for the state, and met with community-based organizations
that had frequent contact with food stamp recipients as well as likely
eligible individuals who were not participating in the program. In
addition, we reviewed documentation about the rationale for, and the
implementation of, state-and local-level strategies to increase
participation in the four states we visited. We performed our work from
May to November 2003 in accordance with generally accepted government
auditing standards.
About half of the individuals in working families who are eligible for
food stamps participate in the program, and certain family
characteristics, such as whether the family also receives other government
benefits, are associated with the likelihood of participation. The rate of
participation among the estimated universe of likely eligible working
families has hovered around 50 percent since 1997, and participation has
consistently been much lower than the rate of participation among members
of likely eligible nonworking families. For example, in 2001, an estimated
52 percent of eligible members of working families participated in the
program, and almost 70 percent of eligible members of nonworking families
did so. In 2002, participating working families received an average of
$210, per household, a month in benefits, while participating nonworking
families received an average of $159, per household, a month in benefits.
This difference is in part because participating working families are, on
average, larger than participating nonworking families. Several family
characteristics are associated with the likelihood that working families
participate in the Food Stamp Program. Working families that participate
in the program are more likely to be eligible to receive
3See appendix I for a detailed explanation of the methodology we used to
analyze public data.
greater food stamp benefit amounts than those that are eligible but do not
participate. In addition, participating working families were more likely
than nonparticipating families to receive other government assistance and
were more likely to rent rather than own a home.
Several factors can act as impediments to a family's participation in the
program, including whether family members are aware of the program's
existence, their potential eligibility, and their perception of the
program based on our fieldwork and other studies. For example, a program
official in Oregon suggested that many working individuals in that state
assume that, because they have a job, their family is not eligible for the
program. In addition, some families choose not to participate because they
consider the administrative process-including having to make frequent
trips to a food stamp office during working hours, completing the program
application, and providing documentation of income-too burdensome.
Evidence also suggests that, in deciding to participate, some families
weigh the perceived burdens of participation against the benefits of doing
so to determine if receiving food stamps is worth it given the size of the
benefit and their level of need. However, some of the administrative
requirements contribute to other priorities of the program, such as
preventing fraud and lowering error rates and targeting benefits to need,
and highlight the tension between the goals of increasing program access
and reducing error rates. A working family's perception of the stigma
attached to receiving food stamps is another factor influencing the
decision to participate. For example, former program recipients in Florida
said that some working families do not participate because they do not
want to go to the assistance office.
To help families, including working families, participate in the program
while ensuring program integrity, FNS and some states and localities have
taken or suggested steps designed to inform the public about the program's
existence and their potential eligibility, ease the administrative
processes, demonstrate the value of the benefit, and reduce the stigma
associated with food stamps. Compiling a complete picture of these steps
was not possible because FNS does not systematically track these efforts,
but our research identified several noteworthy efforts. For instance, to
increase awareness of the program, FNS and some states and communitybased
organizations have advertised the program to working families and others
and run hotlines to respond to questions about the program's rules. To
help states ease the perceived administrative burden associated with their
programs, FNS has provided guides that share with state and local offices
some examples of known efforts to improve program access. One such
practice, tried in California, was to extend office hours from 7:00 a.m.
to 9:00 p.m. to allow working families to visit without missing work.
However, FNS did not include in the guide any evidence that this effort
was successful or any lessons learned from this or other efforts. To
demonstrate the value of benefits to families, several states we visited
used a Web-based tool that allowed individuals to log on from personal
computers and, guided by questions regarding family characteristics,
determine potential eligibility and size of benefit. Other steps are being
taken to reduce the stigma associated with the program. For example, in
Miami, officials from a community-based organization gave presentations to
low-income workers at their place of work on the value of food stamps as a
work support. FNS officials have also discussed renaming the program
nationally, in order to reduce the stigma associated with participation.
At the same time states and localities are adopting practices to help
families participate in the Food Stamp Program, officials also are mindful
about their responsibility for ensuring program integrity. For example,
many states have adopted program eligibility simplification options that
have the potential to reduce program errors while also easing the
administrative burden on states and working families. Finally, while the
steps that have been taken or suggested may help families participate in
the Food Stamp Program, not enough information on efforts underway or
their outcomes is available to determine whether they are effective at
increasing program participation.
To better target federal, state, and local outreach efforts; maximize the
benefits of the available outreach dollars; and identify and eliminate
impediments to food stamp participation, we recommend that the Secretary
of Agriculture direct FNS to: (1) encourage states to collect and report
on the results of their outreach and other efforts to increase
participation among eligible working families and (2) disseminate the
lessons learned from those efforts to other states and localities. In its
comments, FNS generally agreed with our findings, conclusions, and
recommendations.
The federal Food Stamp Program is intended to help low-income individuals
and families obtain a more nutritious diet by supplementing their income
with benefits to purchase food. FNS pays the full cost of food stamp
benefits and shares the states' administrative costs-with FNS usually
paying 50 percent-and is responsible for promulgating program regulations
and ensuring that state officials administer the program in compliance
with program rules. 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, usually on an Electronic Benefits Transfer
Background
(EBT) card. The program is usually administered out of an assistance
office and, oftentimes, assistance offices also offer other benefits,
including Temporary Assistance for Needy Families (TANF), Medicaid, and
child care assistance.4 Figure 1 outlines the general steps a household
must take to participate in the Food Stamp Program and how each step
occurs.
4Food stamp applications can also be taken at other locations such as
health clinics and one-stop centers established by the Workforce
Investment Act to serve job seekers accessing employment and training
services.
Figure 1: Families Must Go through Several Steps to Receive Food Stamps
Source: GAO analysis.
Eligibility for participation in the Food Stamp Program is based on the
Department of Health and Human Services' poverty guideline for households.
In most states, a household's gross income cannot exceed 130 percent of
the poverty guideline (or about $1,654 per month for a family of three
living in the contiguous United States) and its net income cannot exceed
100 percent of the poverty guideline (or about $1,272 per month for a
family of three living in the contiguous United States). In
addition, most states place a limit of $2,000 on household assets, and
basic program rules limit the value of vehicles an applicant can own and
still be eligible for the program. Other factors affecting benefit levels
include size of household, income level, shelter expenses, child care
costs, and child support payments. (Eligibility requirements are less
stringent for households with elderly or disabled members.) Participants
must also periodically recertify by documenting their continued
eligibility for program benefits.
In fiscal year 2003, the Food Stamp Program issued more than $21 billion
in benefits. In September 2003, more than 22.7 million individuals
participated in the program. This is an increase from the same month in
2002, when the Food Stamp Program provided benefits to almost 19.8 million
Americans. As shown in figure 2, the increase in the average monthly
participation of food stamp recipients in 2003 continues a recent upward
trend in the number of people receiving benefits.
Figure 2: Food Stamp Recipiency Has Increased in the Last 2 Years,
Following a Substantial Decline
Average monthly participation (in millions) 30
25
20
15
10
5
0
1996 1997 1998 1999 2000 2001 2002 2003
Fiscal year Source: The Food and Nutrition Service.
The decrease in number of recipients from 1996 to 2001 can be explained,
in part, by the passage of the Personal Responsibility and Work
Opportunity Act of 1996 (PRWORA), which toughened eligibility criteria and
made certain groups ineligible to receive benefits, and had the effect
of un-tethering food stamps from cash assistance. In some cases, this
caused participants to believe they were no longer eligible for food
stamps when TANF benefits were ended.5 In addition, studies have suggested
that the economic growth in the late 1990s played a major role in the
decrease of recipients. Since 2000, that downward trend has reversed, and
stakeholders believe that the downturn in the U.S. economy, coupled with
changes in the program's rules and administration, has led to an increase
in the number of food stamp recipients. Although the total number of food
stamp recipients is still below the 1996 level, since February 2001, the
number of recipients has increased over 30 percent.
Despite this increase, it remains the goal of FNS and several states to
increase participation in the program among eligible families, while
maintaining program integrity. FNS's fiscal year 2000 strategic plan makes
it a goal of the administration to improve the rate of food stamp
participation among all eligible people to 68 percent by 2005.6 According
to FNS officials, eligible immigrants, elderly Americans, and members of
working families are the major subgroups targeted to increase
participation.
The administration has chosen to focus on participation among working
families, in part, because of the increased emphasis placed on the need
for work supports such as food stamps, the Earned Income Tax Credit7
(EITC), and child care and transportation subsidies-since PRWORA.
In addition, the Farm Security and Rural Investment Act of 2002 (the 2002
Farm Bill) included provisions intended to encourage participation among
underserved groups, including working families, and simplify program
administration.8 For example, the 2002 Farm Bill gave states the option to
5As GAO and others have reported previously, following the passage of
PRWORA, there is evidence that food stamp participation dropped as
eligible recipients did not apply for food stamps because they incorrectly
assumed that if they are ineligible for TANF, they are also ineligible for
food stamps. See U.S. General Accounting Office, Food Stamp Program:
Various Factors Have Led to Declining Participation, GAO/RCED-99-185
(Washington D.C.: July 1999) for more details.
6The strategic plan sets a baseline of 63 percent in 1997.
7The EITC is a federal income tax credit for low-income workers who are
eligible for and claim the credit. The credit reduces the amount of tax an
individual owes and may be returned in the form of a refund.
8See appendix II for details on the Farm Security and Rural Investment Act
of 2002.
maintain food stamp benefits at a consistent level for a transition period
for individuals who left TANF to go to work. The 2002 Farm Bill also made
it possible for FNS to provide financial awards to states with higher or
improved performance in program administration. In response, FNS has
targeted improving program participation in addition to its existing focus
on payment accuracy and lowering error rates. The food stamp error rate
was 8.26 percent in fiscal year 2002, the lowest in the program's
history.9
In the last few years, working families have become a greater proportion
of the overall food stamp participant population. As of fiscal year 2002,
about 40 percent of those individuals receiving food stamps were members
of households with earnings, up from about 33 percent in 1997. As shown in
figure 3, this increase occurred at the same time that the proportion of
food stamp recipients receiving TANF declined dramatically. This can be
explained, in part, by the fact that when TANF recipients leave that
program, they may still be eligible for food stamp benefits. Thus, if TANF
recipients leave that program because they have found employment, they can
continue to receive food stamps until their income increases enough to
disqualify them from the program or until they are no longer eligible for
other reasons. Because of the increase in the proportion of food stamp
participants who are living in households with earned income, serving
lowincome working families has taken on an increased importance for the
Food Stamp Program in recent years.
9The food stamp error rate is calculated for the entire program, as well
as every state, by adding overpayments to those who are eligible for
smaller benefits, over payments to those who are not eligible for any
benefit, and underpayments to those who do not get as many benefits as
they should. In fiscal year 2002, the overpayment was 6.16 percent and the
underpayment was 2.10 percent. The program also calculates a negative
action error rate, defined as the rate of improper denials or terminations
of benefits.
Figure 3: More Food Stamp Recipients Now Live in Households with Earnings
than Households on TANF
Percentage of food stamp recipients
50
45
40
35
30
25
20
15
10
5
0
1997 1998 1999 2000 2001
Fiscal year
Food Stamp Program participants living in households with earned income
Food Stamp Program participants living in households receiving TANF income
Source: The Food and Nutrition Service.
Note: This figure depicts complementary trends in two groups of food stamp
recipients that are not mutually exclusive. In other words, TANF
recipients can also be employed and have earned income. In addition, other
individuals who are neither working nor receiving TANF may receive food
stamps as well, such as Social Security and unemployment compensation
recipients.
A lower percentage of food stamp-eligible individuals in working families
received food stamp benefits than those in eligible nonworking families,
and certain family characteristics are associated with the likelihood of
participation. In September 2001, the most recent data available, the
participation rate of likely food stamp-eligible individuals in households
with earnings was estimated to be approximately 52 percent. At the same
time, estimated participation among members of eligible nonworking
families was almost 70 percent. Despite their lower participation rate,
the average participating working family received a larger benefit than
the average nonworking family. The amount of food stamps a working family
is eligible for appears to be one of the major factors associated with the
participation of working families, with those families eligible for larger
food stamp benefits more likely to participate in the program. Other
characteristics that are associated with the likelihood of food stamp
receipt among working families include family size, amount spent on
Eligible Working Families Participate in the Food Stamp Program at a Lower
Rate than Eligible Nonworking Families
shelter, and the marital status of the head of household. Finally, working
families that receive unearned income through other government assistance
programs are more likely to receive food stamps than those with no
unearned income.
Just Over Half of Members of Eligible Working Families Participated in the
Food Stamp Program in 2001
In September 2001, an estimated 52 percent of individuals in eligible
working families participated in the Food Stamp Program, according to an
analysis done for FNS.10 In the same month, the participation rate among
all eligible individuals was estimated by FNS to be 62 percent,11 and the
rate among members of nonworking families was almost 70 percent. As shown
in figure 4, the participation rate among working families has been
relatively constant in recent years-hovering around 50 percent-and it has
consistently been lower than the rate among nonworking families.
10K. Cunnyngham, Mathematica Policy Research, Inc., for The Food and
Nutrition Service, Trends in Food Stamp Program Participation Rates: 1999
to 2001 (Alexandria, Va.: July 2003). This study identified an increase in
the participation rate among people eligible for benefits in households
with earnings from 47.3 percent in fiscal year 1999 to 51.8 percent in
fiscal year 2001.
11The participation rates reported are based on the actual number of
individuals participating in the Food Stamp Program and estimates of the
number of individuals eligible for food stamps. FNS contracts with
Mathematica Policy Research, Inc., to calculate participation rate data
for the program. The participation rate figure is determined by dividing
the actual number of individuals who participate by the estimated number
of individuals who are eligible. The actual number of participants comes
from Food Stamp Program operations data. The estimate of eligible
individuals is derived from a model that uses March Current Population
Survey data to simulate household characteristics. The Mathematica
participation rate calculation is the generally accepted standard by USDA.
Because of delays in the availability of needed survey data, a lag exists
between actual participation numbers being available and the calculation
of participation rates.
Figure 4: Participation Rates Are Lower for Working Families than for
Nonworking Families
Participation rate among eligibles (percentage)
100
90
80
Among the families that receive food stamps, working families get larger
benefits than nonworking families. In 2002, working families that
participated in the Food Stamp Program received, on average, $210 a month
in food stamps per household, according to information collected by FNS.12
This amount is more than the $159 average benefit received by households
with no earned income. The fact that working families received more
benefits, on average, than nonworking families is, in part, due to family
size. In general, the larger the family size, the larger the family's
benefit. Working food stamp families have an average of 3.2 persons per
household, as opposed to nonworking families that receive
12U.S. Department of Agriculture, Food and Nutrition Service Office of
Analysis, Nutrition, and Evaluation, Characteristics of Food Stamp
Households: Fiscal Year 2002 (Alexandria, Va.: December 2003).
70
60
50
40
30
20
10 0
1994 1995 1996 1997 1998 1999 2000 Year
Eligible individuals in households with earned income
All eligible individuals
Eligible individuals in households with no earnings (GAO estimate)
Source: The Food and Nutrition Service and GAO.
Participating Working Families Receive Higher Monthly Benefits than
Nonworking Families, and Benefit Amounts Vary Based on Family
Characteristics
benefits, which average fewer than two persons per household. In addition
to household size, household income level also affects benefit level, as
do other factors such as cost of shelter, child care costs, and child
support payments.
While it is true that the amount of food stamp benefits that a working
family is eligible for decreases as the family's gross income increases,
there is not an immediate drop-off in benefit level as income increases,
nor is there a one dollar drop in benefits for every additional dollar in
income earned.
To demonstrate the effect of additional earned income on working families
that receive food stamps, FNS provided us with an example of how earnings
might impact a hypothetical family consisting of a single mother with two
children. Figure 5 shows estimates of the amount of food stamps for which
this family would be eligible given varying monthly income levels.
Figure 5: Estimated Food Stamp Benefits for a Single Mother with Two
Children Based upon Varying Amounts of Monthly Income
Monthly food stamp benefits (in dollars) 400
356 356
Our data analysis shows that there are several characteristics that are
associated with an eligible working family's likelihood of participating
in the Food Stamp Program. To determine the family characteristics that
contribute to the likelihood of program participation for eligible working
families, we analyzed a database produced by Mathematica Policy Research,
Inc., of likely eligible working families based on the March 2001 Current
Population Survey (CPS).13 This is the most current data available. Table
1 shows the differences between participating working families and those
we estimate are eligible but not participating in 2000, the last year for
which information was available.
13For a detailed description of the process, used to complete this
analysis, see appendix I.
350
300
250
200
150
100 50 0
$176 $351 $702 $1,053 $1,404 Monthly earned income
Source: The Food and Nutrition Service.
Note: To develop this estimate, FNS assumed that the mother worked; had no
unearned income, dependent care, or child support deduction; and had a
$300 a month shelter expense. FNS used the fiscal year 2002 Food Stamp
Program rules, specifically the value of the maximum food stamp allotment
for a family of three and the shelter deduction cap and other assumptions
as appropriate. In fiscal year 2001, the average earned income for
households with children was $351 per month so FNS used multiples of that
amount, ranging from one-half to four times that amount to produce its
estimates. The maximum allotment for a household with three persons was
$356.
Certain Family Characteristics Are Associated with the Likelihood of
Participation
Table 1: Characteristics That Are Associated with the Likelihood of Food
Stamp Participation
Participating working families are more Eligible nonparticipating working
likely than eligible nonparticipating families are more likely than
working families to: participating families to:
o Be eligible for higher monthly food stamp benefits.
o Have lower shelter expenses.
o Rent their home.
o Not have an elderly member in the household.
o Have a child under 5 in the household.
o Have a head of household that is divorced, separated, or single.
o Have citizen head of household.
o Have unearned income.
o Participate in other assistance programs (Women, Infants, and
Children, Medicaid, energy assistance, school meals, or job training).
o Be eligible for a lower amount of food stamp benefits.
o Have higher shelter expenses.
o Own their home.
o Have an elderly individual in the household.
o Not have a child under 5 in the household.
o Have a married head of household.
o Have noncitizen head of household.
o Have no unearned income.
o Not participate in other assistance programs.
Source: GAO
Note: The characteristics listed correspond to effects found significant
at the 0.05 level in our statistical analysis. See appendix I for a
complete discussion of this work.
Some characteristics are associated with the increased likelihood of
participation. For instance, food stamp participation was more likely
among working families that were eligible for a larger amount of food
stamp benefits; specifically, each $100 increase in monthly benefits for
which families were eligible increased the likelihood of participating in
the program by approximately 30 percent. Working families with young
children-under 5 years old-in the household were also more likely to
participate than likely eligible working families without young children.
Other characteristics are associated with the reduced likelihood of
participation. For example, working families with higher shelter expenses
were less likely to participate; each $100 increase in monthly shelter
expenses decreased the likelihood of participating by about 10 percent. In
addition, working families that owned rather than rented their dwellings,
were less likely to participate in food stamps than other working
families, by about 50 percent. Families with a noncitizen head of
household, and families with elderly or married individuals in the
household, were also only about half as likely to participate in the
program.
Finally, families with any unearned income were more than 2 times as
likely as those without any unearned income to participate in the Food
Stamp Program. And, the likelihood of participating was almost 11 times
higher for those families that received Medicaid benefits than for those
who did not, over 6 times higher for those who received energy assistance
and over 4 times higher for households in which someone received job
training. Similarly, the likelihood of participating in the Food Stamp
Program was about 3 times higher for working families participating in
free or reduced school lunch program or in the Special Supplemental
Nutrition Program for Women, Infants, and Children (WIC) than for those
eligible nonparticipating working families that did not participate in
those programs.
In assessing the results of our analysis, it is worth noting that some of
the characteristics that are associated with the participation by likely
eligible working families also are likely to be associated with the
participation of all eligible participants. For this study, however, the
analysis focuses on how these characteristics are associated with working
families. By focusing on the differing characteristics of participating
and nonparticipating working families, it is possible to develop a better
understanding of how working families that receive food stamps are
different from likely eligible working families that do not receive
benefits. This analysis does not, on its own, offer any explanation for
why these families choose to participate, but it does help identify
characteristics of those families who do and do not participate. The
analysis also provides additional support for how certain impediments we
identified can affect a working family's decision to apply for and receive
food stamp benefits. The following section elaborates on those factors.
Several factors may impede an eligible working family's participation in
the Food Stamp Program, according to our fieldwork and literature on the
subject. Among them are whether the family is aware of the program's
existence and the family's possible eligibility, the family's willingness
to deal with the program's administrative process, whether the family
judges the amount of food stamp benefits received to be worth the effort
and cost of participating in the program, and the extent to which the
family associates a stigma with food stamp receipt. Figure 6 shows how
these factors interact with the steps necessary for a working family to
receive food stamps.
Factors Related to a Family's Awareness and Perception of the Food Stamp
Program Influence Their Participation
Figure 6: Impediments to Participation Have the Potential to Impact Each Step of
the Food Stamp Process
Source: GAO analysis.
Participating in the Food To receive food stamps, a family has to apply
for the benefits, a step which Stamp Program Depends is taken, generally,
by a member of the family going to a local assistance on a Family's
Awareness of office and filling out an application. Participation,
therefore, is dependent
on the family being aware of the program's existence and its possiblethe
Program and Eligibility eligibility. Yet, studies of participation in the
program that we reviewedCriteria offer evidence that many eligible
families lack such awareness. For
example, a study done by Mathematica Policy Research, Inc., for FNS, based
on interviews with likely eligible individuals that do not participate in
the program, found that 72 percent of those surveyed were not aware of
their probable eligibility.14
Program stakeholders, too, said that lack of information about the program
and how it works plays a key role in nonparticipation for working
families. For instance, according to officials in Florida, working
families may not participate because they are uncertain about the
program's rules and eligibility criteria and how to participate. A worker
for a communitybased organization in Florida who did outreach to working
families said that many individuals are unfamiliar with the program's
workings, making food stamp receipt difficult.
Program officials also suggested that many working individuals assume that
their having a job makes their family ineligible for the program. As one
official in Oregon said, she believes that some working people do not
think of themselves as food stamp recipients, because they believe that
food stamps are something for the very poor, and thus do not think they
would be eligible given that they have jobs. Officials in Florida and
Massachusetts agreed that some potentially eligible working families do
not participate because they do not know that they are potentially
eligible for food stamps.
Confusion about the relationship between food stamp eligibility rules and
TANF eligibility rules can also contribute to working families wrongly
believing that they are ineligible for food stamps, according to program
officials that we talked with. An official for the New York Office of
Transitional and Disability Assistance said that some people still believe
that when one's TANF case closes, one's food stamp case closes as well.
The official said that, despite New York's best effort to combat this
false information, some people leave the Food Stamp Program when they
leave TANF because they believe that they are no longer eligible for food
stamps.
14Michael Ponza, et al., Mathematica Policy Research, Inc., Customer
Service in the Food Stamp Program (Princeton, NJ: July 1999).
The Perception that the Food Stamp Program's Administrative Process Is
Burdensome Can Deter Participation
Another factor influencing whether a family participates in the Food Stamp
Program is how the food stamp administrative process is perceived. In
other words, according to the literature we reviewed and the program
officials we spoke with, if the administrative process is seen as being
burdensome, families may not participate because of the effort required to
apply for and receive food stamps. In addition, our analysis of CPS data
demonstrates that, in 2000, working families that participate in the Food
Stamp Program are more likely to receive other types of government
assistance-such as Medicaid, WIC, and energy assistance-than
nonparticipating working families. One possible explanation for this
difference is that those that have a comfort level with the administrative
process of applying for and receiving assistance might be more likely to
participate in the Food Stamp Program.
We identified certain administrative practices during our site visits to
food stamp offices in Florida, Massachusetts, New York, and Oregon, that
could be considered burdensome by potential recipients who work and that
might deter participation. Among the practices identified were multiple
required office visits, food stamp office operating hours, food stamp
applications, requirements for eligibility documentation and verification,
finger imaging for program participants, and the requirement for workers
to report changes in their income and hours worked. However, we found that
not all of these practices that are potential impediments to participation
were in place in every local office that we visited and that these
practices are not in place in exactly the same fashion at each office. In
addition, it is clear that there are potentially significant benefits-
including fraud and error prevention, targeting benefits to need, and the
provision of more cost-effective service-to some of the administrative
processes.
Among the practices that can influence whether a family participates in
the Food Stamp Program are:
o Required office visits. In some cases, potential recipients make a
trip to the assistance office to fill out a food stamp application and a
separate trip for the recipient to meet with a caseworker to determine
eligibility. In addition, potential clients may have to return to the food
stamp office if they do not bring all the required documentation to their
first visit. This means that a family often has to make two or more trips
to the office to participate in the program, which can be difficult for
individuals who are working.
o Office hours. Assistance offices are often only open during regular
working hours. For example, we visited an office that opened from 8:30
a.m. to 4:30 p.m. from Monday to Friday. For working individuals, getting
to a food stamp office during the work week can be difficult. A recent
study by the Urban Institute supports the notion that a working families'
participation status is influenced by the hours they work and, perhaps, by
the hours a food stamp office is open.15 The study found that those who
work so-called traditional hours are less likely to participate than those
who work a less traditional schedule. However, offering longer hours of
service can have cost implications such as additional personnel, utility,
computer, and security costs.
o The food stamp application. During our site visits, program advocates
said that applications, which often serve both food stamps and other
assistance programs, such as Medicaid and TANF, are too complex. For
instance, an advocate said that she believed that the food stamp
application was too long and required a reading level that was too
advanced for most potentially eligible individuals. State officials in
Oregon, however, said that having a slightly longer food stamp application
allows for better integration of assistance programs, which can benefit
recipients, as well as a reduction of workload for caseworkers at
assistance offices.
o Eligibility documentation and verification. Participating in the
program requires proof of income level, residency, and family size, among
other information. Providing such proof usually is done by bringing
documentation to the food stamp office at the time of enrollment. This,
however, can be perceived as being burdensome for potential clients. For
example, current and former food stamp clients surveyed in an Oregon focus
group reported that various documentation forms in that state are
intrusive and often excessive. However, under current program rules, these
requirements are an essential component of ensuring that food stamp
applicants are eligible to receive food stamps and that they receive the
proper benefit amount.
o The finger-imaging requirement. Four states in the country have
requirements that new recipients of food stamps are finger-imaged at the
assistance office before they receive their benefits.16 New York was the
15Signe-Mary McKernan, et al., The Urban Institute: Employment Factors
Influencing Food Stamp Participation (Washington, D.C.: August 2003).
16The four states with finger-imaging requirements are Arizona,
California, New York, and Texas.
only state we visited that had such a requirement. Advocates in that state
complained that being finger-imaged was a deterrent to participation, in
that it potentially required them to make an additional trip to the food
stamp office. However, quality control officials in that state believed
that it was a vital way to prevent people from defrauding the Food Stamp
Program by allowing officials to verify that the applicant did not already
have a case open somewhere else in the state.
o Change reporting requirement. Participating in the program often
requires families to report income changes, meaning that some working
families would have to be in frequent contact with their caseworker as the
amount of hours they worked or the wages they received fluctuated. The
requirement has the potential to add to the burden of participation, and
program officials said that the requirement was a potential deterrent for
working families. However, doing so also ensures that food stamp
recipients continue to receive the correct benefit amount. These income
changes can result in either an increase or decrease of benefit levels.
Government officials we talked with acknowledged that the food stamp
administrative process can be burdensome and that participating in the
program is complex. However, officials spoke positively of many of the
practices in their states, such as finger imaging and the requirement for
multiple office visits. Many of the practices that might be perceived by
potential recipients as causing burdens contribute to other priorities of
the program, such as streamlining the eligibility process and keeping the
program's error rate as low as possible.17 The perceived impediments
associated with many of the administrative processes, and the justifiable
reasons the processes exist, highlight the tradeoffs between the various
program goals, including increasing program access and reducing error
rates, that are inherent with the design of the Food Stamp Program. Some
of these practices probably contribute to some eligible working families
not participating in the program, but they also probably help to ensure
that only eligible families receive benefits, which is vital to
maintaining public support for the program.
17For more information on program integrity and participation challenges,
see U.S. General Accounting Office, Food Stamp Program: Program Integrity
and Participation Challenges, GAO-01-881T (Washington D.C.: June 27,
2001).
Evidence Suggests that Food Stamp Participation Is Often Driven by Whether
a Family Considers the Benefits Worth the Effort and Cost of Participating
Another factor influencing whether eligible working families participate
in the Food Stamp Program is how much they value the food stamp benefit,
according to evidence from available public data, the literature we
reviewed, and visits to four states. Working families may make an informal
cost-benefit analysis of whether their need for the benefits they would
receive outweighs the effort and cost of participation. Costs can include
taking time off from work and the transportation costs of getting to a
food stamp office. Our analysis of 2000 CPS data-which demonstrates that
working families that receive other government assistance are more likely
to participate in the Food Stamp Program-is consistent with that. Given
that many assistance programs are administered at the same office and
sometimes using the same application as food stamps, participating in
other programs is likely to reduce the cost of food stamp participation,
which makes a working family more likely to participate in food stamps.
Our analysis of the 2000 data also demonstrates that working families that
are eligible for larger benefits are more likely to receive food stamps
than those that are eligible for smaller benefit amounts. Program
officials also cite the amount of benefits as a reason that some working
families do not participate. An official in Massachusetts said that some
working families may qualify only for a small dollar amount a month, which
our evidence supports, and, because of that fact, some potential
recipients believe that the effort associated with applying is not worth
the small amount.
In addition, available research shows that whether a family is willing to
participate in the program can also be influenced by the extent to which
the family believes it needs the benefit. In a survey and focus groups
Mathematica Policy Research, Inc., conducted for FNS, it found that many
likely eligible working families did not participate because they believed
that they could get by without food stamps and that others need them
more.18 Such families seem to be placing a minimal value on their food
stamp benefit. Moreover, research done by USDA's Economic Research Service
suggests that families that are food insecure19 are more likely to
18Sheena McConnell, Michael Ponza, and Mathematica Policy Research, Inc.,
The Reaching the Working Poor and Poor Elderly Study: What We Learned and
Recommendations for Future Research, (Washington, D.C.: December 1999).
19Food insecurity is defined as a family being, at some point during the
previous year, uncertain of having, or unable to acquire, enough food to
meet basic needs of all its members because they had insufficient money or
other resources.
participate than families that are food secure.20 Both of these research
efforts suggest that a family's level of need plays a role in whether a
working family participates in the Food Stamp Program. Those families
believe that they do not need food stamps are less likely to bear the
costs of participating in terms of lost time and inconvenience, while
those families that are in need may be more likely to participate no
matter what the benefit level is.
A study published by The Lewin Group reinforces the idea that need plays a
role in the decision to participate.21 In a study using data from the
Survey of Income and Program Participation (SIPP),22 the authors found
that likely eligible nonparticipating working households differed from
participating working households in their income variability.
Nonparticipating households were more likely to have experienced a
short-term drop of income than participants and were more likely to have
had recent past income that exceeded 100 percent of the federal poverty
level. From these findings, the authors suggest that many nonparticipants
have expectations of higher future income and do not see the need for food
stamps, which helps to explain why they do not participate.
The Stigma Associated with the Food Stamp Program Can Cause Some Families
Not to Participate
The stigma associated with the Food Stamp Program is one of the reasons
some eligible families do not participate in the program, according to
existing research and interviews with program stakeholders. Although the
program's primary mission is nutrition assistance, program stakeholders
believe the stigma associated with food stamps is largely related to the
program's welfare connotations. Focus groups of current and former food
stamp recipients, conducted by a community-based organization in Oregon,
echoed that sentiment. A theme that ran through the focus group responses
was that people were ashamed, or too proud, to receive food stamps. The
focus group responses indicated that individuals can have
20Mark Nord, et al., USDA Food Assistance & Nutrition Research Program,
Household Food Security in the United States, 2001 (Washington, D.C.:
October 2002).
21Mary Farrell, David Stapleton et al., The Lewin Group and Cornell Center
for Policy Research The Relationship of Earnings and Income to Food Stamp
Participation: A Longitudinal Analysis (Washington, D.C.: August 2003).
22The SIPP is conducted by the Census Bureau. It collects source and
amount of income, labor force information, program participation and
eligibility data, and general demographic characteristics to measure the
effectiveness of existing federal, state, and local programs. This study
followed a panel of households from 1996 over a 4-year period.
personal shame about receiving food stamp benefits and may be worried
about being looked down upon for receiving them.
For working families, the welfare stigma can be a particular deterrent
toward food stamp participation. For example, program officials cited the
occasional need to verify a food stamp recipient's wages and employment
status with the recipient's employer as one stigma associated with food
stamp receipt for working families. A related deterrent for working
families is that to participate in the program, a family usually has to
make a trip to the food stamp office, which is also the "welfare office."
Advocacy groups said that this was a requirement that discouraged
participation among working families. Former Florida food stamp recipients
told us that caseworkers ask personal questions regarding how they manage
their finances. For example, how one pays for hair care and laundry, which
they considered intrusive and made them less likely to participate in the
program. However, local officials in Florida said that these questions are
an effective method to deter program fraud and ensure that food stamp
benefit amounts were provided accurately.
Measuring the extent of stigma can be difficult, because stigma is often a
personal matter. Many of the officials we spoke with said that the move
toward EBT cards has helped alleviate the stigma of the program for
working families and others by making food purchases by program recipients
look more like ordinary food purchases, thus making it more difficult for
other shoppers at grocery stores to identify food stamp recipients'
purchases. Still, many of the same officials said that stigma remains an
issue.
FNS and Some States and Localities Have Taken, or Suggested, Steps to Help
Working Families Participate in the Program While Ensuring Program Integrity
FNS and the states and localities we visited have taken or suggested a
variety of steps to address identified program impediments that may hinder
the participation of working families in the Food Stamp Program. These
efforts include informing the public about the availability of food
stamps, easing the administrative processes, estimating eligibility and
the potential size of benefits, and reducing the stigma associated with
food stamps while also adopting strategies to ensure that serving working
families does not jeopardize program integrity.
Several Efforts Are Underway to Better Inform the Public about Food Stamp
Availability and the Program's Eligibility Criteria
FNS Outreach Grants and Guides
Several federal, state, and local efforts are in place to make information
about the Food Stamp Program available to potentially eligible working
individuals. These include efforts to inform the public through outreach
efforts, such as media campaigns, and to reach potential program
participants in locations where they are likely to be, such as their
places of employment. While officials we spoke with were hopeful about the
ability of these efforts to reach the right audience, little outcome data
are available to determine which outreach efforts are most effective.
FNS has provided some specific grants to states and organizations to
conduct food stamp outreach; however, FNS does not know the total amount
of other funds states spend on outreach. In fiscal years 2001 and 2002,
FNS awarded 100 percent funded competitive outreach grants to state- and
community-based organizations.23 Some of these grants specifically
targeted working families while others targeted all low-income families.
The impact of these grants are largely unknown to date, although FNS is
conducting assessments. Because the grants are awarded to address local
needs, FNS officials reported that they do not expect major findings on
ways to improve service to working families, but do expect results to
reveal potentially effective ways to do localized outreach. In addition,
FNS also recently awarded competitive program participation grants made
available by the 2002 Farm Bill to agencies or universities. The goal of
these grants is to improve the food stamp application process and work to
identify and eliminate barriers to participation. FNS will in addition,
pay for half of any outreach effort funded by the states. Some of these
efforts are formalized through an approved outreach plan, and the funds
spent on them are reported separately. Other state outreach efforts,
however, may be conducted without FNS's knowledge and claimed as an
allowable administrative expense but not separately identified as outreach
in the states' fiscal reports according to an FNS official. Table 2
provides more information about the known outreach efforts.
23In fiscal year 2004, FNS hopes to gain new partners by awarding smaller
grants for food stamp outreach to smaller-sized, community-based and
faith-based organizations, with the anticipation of obtaining new ideas
for implementing outreach activities. One of the strategies promoted in
the grant solicitation is the use of employers to facilitate the
application process.
Table 2: Recent FNS-Funded Outreach Activities Conducted by States, Local
Government, or Community-Based Organizations
Type of outreach FNS percentage Number of Total funding
effort Fiscal year funding rate states (dollars in millions)
State outreach
plan 2002 50 14 $8.8a
Outreach grant 2002 100 19
Program
participation grant 2003b 100 5
Source: FNS.
aStates or community-based organizations paid $4.4 million of this amount.
bThe 2002 Farm Bill allows USDA to award up to $5 million per year for
fiscal years 2003 through 2007 to entities to carry out projects to
simplify food stamp application and eligibility determination and to
improve access to food stamp benefits.
FNS regional offices also conduct program access reviews of selected local
offices in all states to determine whether state and/or local policies and
procedures served to discourage individuals from applying for food stamps
or whether local offices had adopted measures to improve customer service.
Some of these measures are gathered into a periodic best practices guide
published by FNS.24 The guide contains information about the goal of the
practice being tried, the number of places where it is in use, and contact
information for a person in these offices. For the most part, however, the
guide does not include any evidence that these efforts were successful or
any lessons learned from these or other efforts.25
FNS is launching a $4 million, nationwide radio food stamp promotion
campaign to raise awareness about the benefits of the Food Stamp Program.
The goals of the campaign are to position the program as a nutrition
assistance and work support program and improve the public's understanding
of the program's purpose and who may be eligible, including working
families. Transit ads and radio spots have been developed and will be
placed in key locations throughout the nation, promoting the national or
state toll-free Food Stamp Program numbers, as appropriate.
24State Best Practices Improving Food Stamp Program Access, USDA, FNS,
(June 2002).
25Advocacy groups such as the American Public Human Services Association,
the Food Research Action Center, and the Nutrition Consortium of New York
State also make information available on food stamp outreach and access in
best practices guides, on their Web sites, or through conferences.
Efforts to Inform the Public
The ads will refer potential food stamp recipients to either FNS's or the
state's telephone hotline to receive information about the Food Stamp
Program. In 2003, the FNS bilingual (English and Spanish) hotline averaged
about 1,900 calls per month according to FNS.26 Some states have also
launched media campaigns. For example, in New York, as part of its
approved outreach plan, efforts were underway to garner interest in the
program in the form of a statewide, $300,000 media campaign and a $500,000
media campaign for New York City. In addition, in each of the four states
we visited, either the state- or a community-based organization had
established a hotline to provide broader outreach to potential clients and
to make them aware of program eligibility requirements and the
documentation they need to apply for benefits. For example, from September
2001 to June 2003, the Community Food Resource Center in New York City
fielded over 110,000 calls from 59,000 individuals requesting food stamp
assistance. The center reported that these calls resulted in 3,240 new
food stamp cases. Other media outreach efforts, both statewide and local,
included advertising on television and radio, posters, and shopping bags
and in newspapers and direct-mail supplements. Many of these broad
outreach efforts were not specifically targeted to working families, but
since some working families may not believe they are eligible for food
stamps, these efforts may help to make them aware of the eligibility
requirements, promote the image of the Food Stamp Program as a nutrition
assistance program, and inform families what they have to do to apply for
benefits.
Some efforts are made to reach working families specifically by making
applications and informational materials available where eligible working
families are likely to go, such as at tax preparation sites, health
clinics, supermarkets, WIC centers, and food pantries. For example, FNS
has partnered with H&R Block to promote food stamps to those families who
qualify for the EITC, which can indicate eligibility for food stamps. FNS
officials said this effort resulted in an increased number of calls to
their hotline during the tax season. FNS plans to expand this type of
partnership
Efforts to Reach Eligible Working Families
26In fiscal year 2003, FNS also made a wide variety of free flyers,
posters, and brochures available to state and local food stamp agencies
and other interested organizations which can be downloaded or ordered
online from the agency's Web site. These educational materials, which
include "Food Stamps Make America Stronger," "Who Qualifies for Food
Stamps?" and "A Small Reason to Find Out if You Qualify for Food Stamps,"
are available in English and Spanish and are targeted to the working poor,
immigrants, and seniors, as well as the general low-income population.
further to tax preparers at the Voluntary Income Tax Assistance Program.27
In Oregon, we spoke with a food stamp worker who is regularly stationed in
a local food pantry. She noted that many working people are more
comfortable coming to the food pantry to apply for food stamps because
government food stamp offices can be off-putting to some people. She
estimated in the last 2 years she has done 1,000 intakes at the food
pantry. However, food stamp officials in all four states cited problems
with tight state budgets resulting in staffing freezes or cuts. As a
result, some offices have cut back on such resource-intensive practices.
Food stamp advocates have also worked with employers whose employees would
likely be eligible for benefits. For example, in Miami, the Human Services
Coalition of Dade County, as part of the Greater Miami Prosperity
Campaign, is attempting to reach out to employers of lowincome workers to
promote certain available work support programs for their employees. The
goal is to convince employers that these work supports are a win for
employees because they augment the wages of lowincome workers; they are a
win for employers, because they bring stability to the life of their
employees who, therefore, feel more loyalty to their employer; and, they
are a win for the community at large, because more federal dollars are
brought into the local economy through the spending of those who receive
work supports. Representatives of the coalition and its partners are
working with the Greater Miami Chamber of Commerce and are making
presentations to employers and their low wage employees and human resource
manager associations around the region focusing on this message.28 The
coalition representatives ask employers to take three actions to support
the campaign: (1) send letters to employees about available work supports;
(2) provide information about the EITC, children's health care, and food
stamps when sending out copies of government documents such as Internal
Revenue Service W-2 earning
27This program, sponsored by the Internal Revenue Service, provides
voluntary assistance with federal income tax returns. FNS has also
initiated additional new efforts to promote food stamps to low-income
individuals through the tax filing process. VITA sites have been
encouraged to display food stamp materials and refer their clients to the
food stamp tollfree number. FNS plans to include an Internal Revenue
Service publication on EITC along with the food stamp materials mailed to
callers of the toll-free number.
28Since 2002, FNS has also presented information and provided training
regarding the importance of food stamps as a work support at the U.S.
Chamber of Commerce's Annual Workforce Development Leadership Course. The
course is designed to build the capacity of local chambers of commerce to
support employers in the area of workforce training and development, with
a focus on employers of low-wage workers and former welfare recipients.
statements; and (3) allow coalition workers to pre-screen employees at the
workplace. The prescreening allows the advocates to more fully explain the
eligibility requirements and what steps applicants must take to qualify
for benefits. As of August 2003, the advocates had convinced a large
Miami-based cruise line to send out information about the work support
programs with employees' W-2 forms and pay stubs, and they had also
conducted on-site pre-screening for employees at several local businesses.
Some state and local programs we visited have also partnered with other
assistance programs, such as the EITC, Medicaid, Head Start, school lunch
program, and WIC, to make working and nonworking families aware of their
potential eligibility for food stamps. Stakeholders spoke highly of such
efforts, and as previously discussed, our analysis of simulated data show
that the likelihood of working families participating in the Food Stamp
Program was much higher if they participated in other assistance programs
as well. Finally, our previous work also showed that 26 states are
conducting food stamp eligibility interviews in at least some of their
Workforce Investment Act one-stop centers.29
In addition to the outreach efforts that have been tried, one local
official suggested that food stamp outreach could be greatly expanded if
the state used taxpayer records to identify potentially eligible working
families. Adopting such a strategy, however, could be problematic because
of the need for state human service agencies and departments of revenue to
coordinate with one another, as well as privacy concerns over the use of
tax data.
Several Efforts Are Underway to Simplify the Administrative Process
States and local offices we visited have adopted a number of different
practices to make administrative processes less burdensome on potential
participants. Among the efforts that resonated particularly with working
families were those intended to save participants' time and allow them to
fulfill program requirements to ensure only eligible families receive
benefits in ways that minimize their need to miss work. While officials we
spoke with were hopeful about these efforts, little outcome data are
available to determine their effectiveness at easing administrative
burdens.
29U.S. General Accounting Office, Workforce Investment Act: States and
Localities Increasingly Coordinate Services for TANF Clients, but Better
Information Needed on Effective Approaches, GAO-02-696 (Washington, D.C.:
July 2002).
Steps to Facilitate the Application Process
States and local offices we visited have adopted a number of different
practices to facilitate the food stamp application process. Oregon and
Florida have adopted a "no wrong door policy" that allows people to apply
for benefits at any food stamp office, and states with Web sites have
placed food stamp applications on the Web, which is a requirement of the
2002 Farm Bill.30 In addition, New York, Oregon, and Massachusetts
shortened and simplified their food stamp applications. While well
received, shortening the application has had some drawbacks. For example,
New York officials told us that because their shortened application was
for food stamps only, it limited the client's ability to apply for more
than one assistance program at the same time. Also, local officials in
Oregon told us that their shortened form required their already
overburdened caseworkers to spend more time with clients gathering
information previously captured on the longer application forms.
States are also facilitating the food stamp application process by
adopting certain available administrative options that can simplify the
application process. For example, when considering the value of a vehicle
as an asset, states may choose to substitute the more generous asset rules
from other assistance programs in place of Food Stamp Program rules
thereby reducing the amount of documentation collected from individuals
applying for more than one program. All four states we visited have
adopted similar vehicle policy options. All four states have also adopted
an option that allows certain families with incomes up to 200 percent of
the poverty level to be automatically eligible for the Food Stamp
Program.31
Several states have experimented with alternative practices to requiring
applicants to come to the food stamp office during traditional office
hours. Three local offices we visited experimented with offering extended
office hours during the week or on Saturdays. State and local officials
reported mixed success with these options. For example, officials at one
local office in Oregon said that adopting client friendly policies such as
these has led to an increase in the caseload while local officials in New
York and Massachusetts dropped these efforts after few potential clients
took
30Community-based organizations in Massachusetts and New York City have
such efforts under development that would allow applications to be sent
electronically to local food stamp offices, but the technology is not yet
in place.
31This option, called expanded categorical eligibility, helps simplify
eligibility determination by eliminating the requirement to determine the
value of assets and verifying family income up to 200 percent of poverty.
Steps to Facilitate Continuing Program Participation
advantage of the extended hours. In addition, in an effort to help working
families avoid missing work and overcome transportation impediments,
Massachusetts adopted liberal rules allowing local offices to interview
clients and take food stamp applications over the telephone or via the
mail if coming to the office would be a hardship for them. Using this
practice, clients still must submit the necessary documentation to ensure
program integrity. In the period from November 2002 to June 2003, over
5,000 food stamp applications were received through the mail.
Some states have taken advantage of options to simplify on-going reporting
requirements. Typically, working families were expected to report earned
income changes. FNS was concerned that the increase in employment among
food stamp households would result in larger and more frequent income
fluctuations, which would increase the risk of payment errors and be
burdensome for the working poor. As a result of these concerns, FNS
established regulations in November 2000 that gave states the option to
require working families to report changes in income between 6 month
certification periods only when a change in their income made them
ineligible for food stamps. All of the four states we visited chose this
option.32 In addition, FNS continued to support efforts to further expand
states' flexibility to streamline complex rules, simplify program
administration, and help ease the transition from welfare to work through
their support of the 2002 Farm Bill amendments. For example, the 2002 Farm
Bill simplifies on-going reporting requirements by allowing states to
disregard changes in certain amounts deducted for child care expenses,
child support payments made, and medical expenses.33 One of our four
states, New York, has chosen this option. Finally, Oregon has simplified
on-going participation by allowing clients to recertify their program
eligibility via the mail rather than by requiring face-to-face interviews.
For families who are leaving cash assistance, the 2002 Farm Bill also
allows states the option of facilitating continued program participation
by providing 5 months of automatic transitional food stamp benefits when a
family leaves the TANF program without requiring the family to reapply or
32All four states have also expanded the use of semiannual reporting to
all households that can be asked to report periodically, a change allowed
under the 2002 Farm Bill.
33This provision is known as simplified determination of deductions in the
2002 Farm Bill.
submit any additional paperwork. Of our four states, Massachusetts, New
York, and Oregon have adopted this option.34
Finally, because application and continuing program participation
impediments can vary from state to state and from locality to locality,
some states and localities have established working groups of program
stakeholders to identify program impediments and to generate ideas on how
to remove them. For example, the Oregon Hunger Relief Task Force
established a committee of officials from the state Department of Human
Services and other state agencies, community advocates, food bank
representatives, local office workers, and former recipients to assess
program access and participation issues. These efforts have opened the
lines of communication and have been deemed successful by both the state
officials and advocates we interviewed.
Efforts Are Underway to Estimate Eligibility and the Size of the Potential
Food Stamp Benefit
Steps to Show People the Amount of Their Estimated Benefit
Some program advocates and officials have taken steps to develop ways to
reach people who may have the wrong impression about their eligibility and
the size and value of food stamp benefits. While the usage of these tools
shows promise where they have been put into place, the final outcomes of
their use are still largely unknown.
FNS's Web site has a pre-screening tool that allows individuals to log on
from personal computers and, guided by questions regarding family
characteristics, determine their potential food stamp eligibility and the
size of their benefit. FNS, however, has not yet started to track how
often this tool is used. Some experts we spoke with suggested that such
Web-based tools are most effective when a third party, such as a program
advocate, is available to help potential clients use them.
We visited three community-based organizations that had prescreening tools
available to help individuals determine their eligibility and estimate
their benefits. Project Bread, located in Massachusetts, uses a Web-based
tool similar to FNS, while Florida Impact and the Community Food Resource
Center in New York City send staff members with laptops to sites where
likely eligible people are found-including emergency food programs or
pantries, WIC centers, health clinics, hospital lobbies,
34For more information on the states' use of options and waivers see U.S.
General Accounting Office, Food Stamp Program: States' Use of Options and
Waivers to Improve Program Administration and Promote Access, GAO-02-409
(Washington, D.C.: Feb. 22, 2002).
unemployment offices, supermarkets, and senior centers-to prescreen
potentially eligible clients. The Community Food Resource Center's
prescreening tool collects client information, estimates their potential
food stamp benefits, and prints out a document guide listing the documents
necessary to apply. This estimated benefit information allows the client
to decide whether the potential benefit would outweigh the perceived
burden of following through with the application process. Table 3 has
selected results from these efforts. Officials from these organizations
have not studied why potentially eligible people chose not to apply for
food stamps.
Table 3: Selected Results from Prescreening Tools Used by Community-Based
Organizations
Number Number Number Number
potentially applied approved
Program Time period screened eligible for food for food
stamps stamps
Florida 306
Impact 9/3/02-9/8/03 1,277 1,025a 284 average
benefit-$176
Mass.
Project 1/15/02-8/11/03 46,505b 39,994 170c 120d
Bread
New York
City's 2002 9,504e f f
Community 12,107 estimated
Food
Resource
Center benefit-$166
Steps to Demonstrate the Value of Food Stamp Participation
Source: Community-based organizations visited.
aNumber of potentially eligible individuals with earned income is not
available.
bFifty-five percent of those screened reported earned income.
cProject Bread officials did not know why so few potentially eligible
individuals were counted as applying for food stamps but speculated that
local offices may not have input the code on the application form that
would identify Project Bread as the source of the application.
dFor the period January 2002-June 2003.
eThirty-two percent of the potentially eligible had earned income; the
average was $1,022 per month.
fInformation not available.
Because some working families believe that their food stamps benefits are
likely to be too low to make participation worthwhile, some local offices
have taken steps to promote the related benefits of food stamp
participation, such as reduced utility bills in some states and
categorical eligibility for school meals. While such efforts may convince
potential participants of the value of food stamps, many of the
stakeholders we interviewed believe that more people would participate in
the program if the minimum food stamp benefit was raised from $10 to at
least $25. Doing this, however, would increase program costs according to
FNS.
Program Officials Have Taken Steps to Reduce the Stigma Associated with
Food Stamps
Steps to Re-Brand the Program
Steps to Disassociate Food Stamps from Welfare
Program stakeholders are taking steps to address the stigma associated
with receiving food stamp benefits, trips to the "welfare office," and
being a "food stamp recipient." Program officials and stakeholders noted
changes that have already been made in the program to limit the stigma and
suggested additional changes. While officials we spoke with were hopeful
about these efforts, little outcome data are available to determine their
effectiveness at easing administrative burdens.
PRWORA mandated that states replace food stamp coupons with the EBT card,
a change that introduced a greater element of privacy during food
purchases. Many of the stakeholders we spoke with believe the EBT card has
helped to reduce the stigma associated with the use of food stamps. Use of
the EBT card has also had the effect of reducing food stamp fraud. As of
September 2003, 95 percent of all food stamp benefit issuance is provided
via the EBT card. Some states and local outreach organizations have taken
the additional step of re-branding, or renaming, their EBT cards. Oregon
promotes its card as the Oregon Trail Card, and the Community Food
Resource Center in New York City promotes the EBT card as "the Food Card."
Beyond renaming the card, many officials suggested that stigma could be
reduced if the program's name was more suggestive of a nutrition program
rather than a welfare program. Four states across the nation have already
renamed their programs.35 For example, Michigan has changed the name of
its Food Stamp Program to the "food assistance program." FNS is currently
considering renaming the program and is consulting with its state partners
on what the name should be.
To corroborate the Food Stamp Program as a nutrition program and to
eliminate trips to "the welfare office," some officials suggested moving
the Food Stamp Program out of the state welfare office and placing it
under the Health Department. However, because states decide where their
various nutrition programs reside, this program change would be difficult
to implement nationally.
New York State is testing a model that allows potential applicants to
avoid the welfare office. The state has developed Transitional Opportunity
Program centers for former TANF recipients who are working and who are
still eligible for work supports, such as food stamps. The idea behind
35The four states are Kansas, Michigan, Minnesota, and Washington.
these centers is to provide benefits and case management for low-income
workers in a friendlier, more positive environment where the focus is on
helping low-income workers achieve self-sufficiency. To do so, caseworkers
provide active case management, bank officials provide seminars on how to
open and manage a bank account, tax preparers discuss the EITC, former
welfare recipients discuss paths to success, childcare providers highlight
strategies for childcare, and nutritionists discuss healthy eating habits.
The case managers are also available to help if a rent or utility
emergency arises.
Finally, some food stamp researchers have suggested a fundamental
reshaping of the way the Food Stamp Program is administered and
overseen.36 They suggested delivering program benefits to those who work
regularly through the tax code, much like the EITC program. Such a change
would eliminate the need for working individuals to go to the food stamp
office. However, such a fundamental reshaping of the program from food
assistance to cash assistance has significant implications for program
mission and integrity, targeting intended beneficiaries, and
administration and would require significant study and review.
Serving Working Families Need Not Jeopardize Program Integrity
State officials believe that food stamp cases with earned income are more
complex and error prone than cases with no income. Food stamp quality
control data show that in fiscal year 2001 cases with only earned income
accounted for about twice the percentage of dollars attributed to errors
as cases with no income. These cases are more complex because low-income
working families' incomes tend to fluctuate as the numbers of hours they
work rise and fall. Therefore, tracking eligibility status, proper benefit
level, and accurate income level is more difficult. This is important to
note because officials in three of the four states we visited were
supportive of the goal of increasing the participation of working families
but were also concerned about the impact these more complex cases could
have on their program error rates. Data indicate, however, that the
increase in the
36Michael E. Fishman and Harold Beebout, Supports for Working Poor
Families: A New Approach (Washington, D.C.: December 2001). Robert I.
Lerman and Michael Wiseman, Restructuring Food Stamps for Working Families
(Washington, D.C.: August 2002). These reports offered potential policy
options for the Food Stamp Program, with an interest in spurring
discussions about improving the delivery of benefits to and well being of
lowincome working families. We did not conduct a detailed review of the
reports or make an assessment of the applicability or validity of any of
the policy options offered by the authors. We selected this example to
highlight some advantages and disadvantages of one alternative scenario
for delivering food stamps.
Conclusions
proportion of working recipients from fiscal years 1997 to 2001 did not
unduly affect the program error rate. Food Stamp Program quality control
data show that over this same period the percentage of dollar payments
made in error to households with only earned income remained about the
same while the overall program error rate declined. These data suggest
that program integrity can be maintained as states strive to better serve
working families.
The program simplification options that many states have adopted also have
the potential to reduce program error while easing the administrative
burden on states and on working families. Some of the options ease the
administrative burdens on families by reducing the number of times they
have to report changes in their cases, in turn reducing the number of
potential errors that can occur responding to those changes. Other options
ease program participation by simplifying the eligibility determination
process. By adopting these options, states are hoping to reduce program
errors while better serving working families.37
Passage of the 1996 welfare reform law changed the safety net landscape
for families by placing greater emphasis on work and self-sufficiency. In
this new environment, the Food Stamp Program can play an important role in
supporting low-income working families, either in their attempt to avoid
receiving cash assistance or as they leave cash assistance and strive for
self-sufficiency. Current efforts focus attention and resources on
increasing participation among all eligible families, particularly working
families. Yet, almost half of those working families that are likely
eligible to receive benefits do not participate in the program. Many of
the federal, state, and local officials we spoke with believe the program
could do more to serve eligible working families, and FNS's goal is to
make it easier for low-income and working families to access the benefits
to which they are entitled.
We observed a number of initiatives that show promise in addressing one or
more of the reasons why working families do not participate in the
37States also have antifraud measures in place to ensure program
integrity. The states we visited use automated data matches to search for
unreported household income and assets. They match their food stamp
caseloads against their wage reporting systems, new-hire data, Internal
Revenue Service Form 1099 data, Social Security and Supplemental Security
Income data, unemployment insurance data, etc. New York State also uses
finger imaging to protect against clients maintaining duplicate food stamp
cases.
program. Most of the initiatives we observed have only been tried on a
small scale at various scattered locations. While we know many efforts are
being undertaken, a complete picture is unavailable because FNS does not
systematically track state activities, nor does it require that states
collect and evaluate outcome data on their own efforts. Although FNS is
beginning to assess the outcomes of some of the outreach grant efforts,
not enough is currently known about all the practices being tried and
whether they have achieved their goals. In addition, in those cases where
initiatives have achieved positive outcomes, there is no systematic
vehicle for disseminating lessons-learned to other programs or
community-based organizations interested in taking similar steps. Efforts
to systematically collect and report simple outcome data on such
initiatives could be a significant resource for other states that want to
increase the food stamp participation among their eligible working
families.
However, despite FNS's and states' best efforts, some eligible working
families may continue to choose not to participate in the Food Stamp
Program and may have good reasons for making that choice. Other eligible
families could benefit significantly if they did participate. Some of the
factors that influence a family's decision about whether to apply for food
stamps are unrelated to the program's design. Some families may make a
personal decision that the effort and cost to them of applying for and
receiving benefits, including complying with the measures in place to
promote program integrity, is not worth the ultimate gain. This seems to
be especially true for families with higher earnings. Each family must
make its own personal calculation based on its unique circumstances, and
some families will likely continue to opt out of receiving benefits.
Recommendations to the Secretary of Agriculture
Agency Comments
To better target federal, state, and local outreach efforts; maximize the
benefits of the available outreach dollars; and identify and eliminate
impediments to food stamp participation, we recommend that the Secretary
of Agriculture direct FNS to
o encourage states to collect and report on the results of their
outreach and other efforts to increase participation among eligible
working families and
o disseminate the lessons learned from those efforts to other states and
localities.
We provided a draft of this report to the U.S. Department of Agriculture
for review and comment. On February 9, 2004, we met with FNS officials,
including the acting deputy administrator for the Food Stamp Program, to
get their comments. The officials said that they generally agreed with our
findings, conclusions, and recommendations. FNS also provided us with
technical comments, which we incorporated where appropriate.
The FNS officials reiterated their commitment to increase working
families' participation in the Food Stamp Program and suggested that we
provide a fuller recognition of their efforts to increase this
participation. The officials said they believe their ongoing efforts to
better inform the public about food stamp availability and the program's
eligibility criteria are contributing significantly to the overall goal of
increasing program participation. In addition, the officials highlighted
their efforts to work with state and local food stamp agencies and other
partners-such as nonprofit organizations, retailers, and employers-to
assist in developing and implementing outreach strategies. The officials
also cited their efforts to encourage the states to simplify the
administrative process and adopt user friendly options. In addition, we
were asked to highlight additional examples of FNS's efforts, and we did,
where appropriate.
Agency officials agreed that our recommendation that FNS track outreach
activities and collect outcome data could provide valuable information.
However, the officials expressed concern that imposing additional data
collection, reporting, and evaluation requirements could be seen as
burdensome by states or local agencies and may discourage some from
undertaking desirable, but optional, activities like outreach. We agree
that requiring rigorous research and evaluation of all outreach efforts
would be costly and difficult. However, we believe encouraging states to
report simple and uniform outcome data on the results of USDA-funded
efforts could be a cost-effective means of collecting information of value
to others attempting to increase working families' participation in the
program. For efforts that are funded locally, USDA could provide a
suggested template of data to collect so that similar data elements would
be gathered across various locations. For example, the sites we visited
did not systematically collect similar information on the number of
working families reached by different activities and the disposition of
their cases. USDA could also use cost-effective means of sharing
lessons-learned with states and localities by posting this information on
its Web site.
We are sending copies of this report to the Secretary of Agriculture;
appropriate congressional committees; and other interested parties. We
will also make copies available to others upon request. In addition, the
report will be available at no charge on GAO's Web site at
http://www.gao.gov. Please contact me at (202) 512-7215 if you or your
staffs have any questions about this report. Other major contributors to
this report are listed in appendix III.
Sigurd R. Nilsen Director, Education, Workforce, and Income Security
Issues
Appendix I: Methodology for Comparing Participating Working Families to Likely
Eligible Nonparticipating Working Families
Our analysis relied on simulated data produced by Mathematica Policy
Research, Inc., based on the March 2001 Current Population Survey (CPS).
The simulated data were used to establish a universe of all working
families that are likely eligible to receive food stamps for the purpose
of comparing the characteristics of participating working families to
likely eligible nonparticipating working families. Mathematica created
this simulated data, in part, because comparisons between the CPS
estimates of Food Stamp Program participation and administrative data from
the program suggest that program participation is underreported in the
CPS, and eligibility for program benefits cannot be directly observed or
reported in existing survey data. To complete the simulation, Mathematica
assigned individuals in each CPS household to one or more "food stamp
units." For each food stamp unit, Mathematica used CPS data and
information from other sources to assign simulated values for variables
such as monthly shelter expenses and monthly earned income. Mathematica
Policy Research, Inc., then tested each food stamp unit to assign the unit
as eligible or ineligible to receive food stamps.
The cumulative characteristics of all households with eligible food stamp
units, as determined by Mathematica's simulated data, are shown in table
4, and include income-related and demographic factors associated with the
households and variables that reflect whether anyone in the household was
participating in other government assistance programs.
Appendix I: Methodology for Comparing Participating Working Families to
Likely Eligible Nonparticipating Working Families
Table 4: Characteristics of Eligible Households with Earnings Used as
Factors to Predict Food Stamp Program Participation (Observed N=2,498;
weighted N=4,911,252)
Factor Mean/percent (weighted estimates)
Monthly food stamp benefits* $153
Monthly shelter expenses* $508
Monthly earned income * $956
Any nonearned income* 37%
Number of people
Elderly 10%
Under age 5 37%
Married 42%
All white - Non-Hispanic 42%
All black (including black Hispanics) 24%
All white Hispanic 26%
Other/mixed race 8%
Noncitizen 8%
Own home 34%
Multifamily 23%
Job training 2%
Free lunch 38%
Energy assistance 8%
Women, Infants, and Children Program (WIC) 19%
Medicaid 43%
Children's Health Insurance Program (CHIP) 6%
Supplemental Security Income*(SSI) 9%
Source: GAO.
Note: Asterisks denote variables with simulated values that were developed
by Mathematica Policy Research, Inc. All estimated means in the table have
sampling errors that, with 95 percent confidence, do not exceed 4 percent
of the value of the estimated means. All estimated percentages in the
table have sampling errors that do not exceed 3 percentage points, with 95
percent confidence.
According to table 4, on average, the households with earnings-working
families-that were deemed eligible to participate in the Food Stamp
Program were eligible to receive $153 in food stamps per month. The
monthly shelter expenses of these families averaged $508, and the monthly
income for these families averaged $956. Slightly more than one-third (37
percent) of the families reported some nonearned income, and a similar
percentage (34 percent) of the families involved had homes or
Appendix I: Methodology for Comparing Participating Working Families to
Likely Eligible Nonparticipating Working Families
dwellings that were owned rather than rented. The rest of the results can
be discerned similarly.
The Analysis Allows for Comparisons between Households with Participating and
Nonparticipating Working Families
In addition to assigning a determination of whether a unit within a
household is eligible to receive food stamps, Mathematica Policy Research,
Inc., made an assignment, based on its known participation patterns, as to
whether eligible food stamp units were receiving food stamp benefits as of
a fixed reference month. However, we could not use Mathematica's simulated
variable that identifies units receiving food stamp benefits to conduct
the substance of our analysis, which was primarily focused on the
difference among participating and likely eligible nonparticipating food
stamp units. This is because Mathematica's procedures were not amenable to
multivariate procedures that would allow an estimate of the "net" effects
of different factors on Food Stamp Program participation - for example,
the effect that food stamp benefit amounts have on the likelihood of
participating after the associations of benefit amounts and participation
likelihoods with other potentially confounding factors are taken into
account. Instead, to conduct this analysis, we relied on CPS estimates of
participating working households and compared those households with those
that were eligible, but not participating, based on Mathematica's work.
Given that, it should be recognized that the results below are affected by
our having chosen to use CPS's variable to identify participants and
Mathematica's variable to identify eligibility. Among households with
working families an estimated 26 percent of the households with an
eligible unit (as defined by Mathematica) were identified as participating
by CPS's variable. By contrast, an estimated 31 percent were identified as
participating by Mathematica's simulated variable. This difference masks
somewhat the extent of the discord between the two variables; an estimated
38 percent of all households that Mathematica's simulation indicates as
participating were not coded as participating by CPS, and an estimated 2
percent of the households that Mathematica's simulation indicates as
nonparticipating were coded as participating in CPS. Additionally, an
estimated 30 percent of the households that CPS recorded as participating
were deemed ineligible to participate by Mathematica's simulation process.
Still, the work that went in to Mathematica's simulation gives us
confidence that the results presented in table 5 are a reasonable
approximation of the different characteristics between participating and
nonparticipating eligible working families. It is worth noting that
variations from the procedures produced by Mathematica for estimating
eligibility could yield results that differ from our analysis since our
work relies on Mathematica's simulation of eligibility.
Appendix I: Methodology for Comparing Participating Working Families to
Likely Eligible Nonparticipating Working Families
To estimate the net effect of different factors affecting the likelihood
of participating, we used logistic regression models that produce odds
ratios to indicate how the odds on participating differed across different
types of households, or across various levels of continuous variables
(like income or the value of food stamp benefits that households were
eligible for) that are associated with each unit. Overall, the odds on
participating were 0.35; that is, 35 eligible households participated for
every 100 that did not.1 These odds differed markedly across different
households, however, and the odds ratios from bivariate models shown in
table 5 indicate the bivariate effects of various factors on the odds on
eligible food stamp working families participating in the Food Stamp
Program, when each factor is considered in isolation, or independently,
from every other factor. Model 1 and model 2 test for the effect of any
characteristic using multivariate models, in order to control for other
factors in measuring whether any single factor effects likelihood of
participation.
1The odds on participating are somewhat different from, but related to,
the percentage participating. The odds equal the percentage participating
divided by the percentage not participating. In this sample of eligible
households with earnings, as noted above, 26 percent of the households
were participating in the Food Stamp Program. The overall odds of
participating were 0.35, which equals 26/74, and implies that 0.35
households were participating for every one that was not, or that 35 were
participating for every 100 that were not. While odds are somewhat less
familiar than percentages, the use of odds and odds ratios to describe the
effects of certain factors on the likelihood of participation involve
certain desirable properties, not the least of which are that they are,
unlike percentages and percentage differences, unaffected by whether we
choose to look at the likelihood of participating rather than not
participating, and by how likely or unlikely participating is across the
subgroups we are comparing.
Appendix I: Methodology for Comparing Participating Working Families to
Likely Eligible Nonparticipating Working Families
Table 5: Odds Ratios Indicating the Effects of Various Factors on Food
Stamp Participation among Eligible Earning Households, from Bivariate and
Multivariate Logistic Regression Models (Observed N=2,498; weighted
N=4,911,252)
Odds ratios Multivariate models
Bivariate
Factor model Model 1 Model 2
Monthly food stamp benefits (in $100s) 1.310* 1.367* 1.316*
Monthly shelter expenses (in $100s) 0.908* 0.923* 0.934*
Monthly earned income (in $1000s) 0.869 1.128 1.113
Any nonearned income 2.564* 2.964* 1.705*
Number of people 1.101* 1.027 0.877*
Elderly 0.479* 0.595* 0.780
Under age 5 1.875* 1.533* 0.989
Married 0.566* 0.563* 0.678*
All black (including black Hispanic) 1.775* 1.311 1.327
All white Hispanic 0.839 1.226 0.962
Other/mixed race 0.861 0.995 0.818
Noncitizen 0.489* 0.516* 0.624*
Own home 0.446* 0.575* 0.704*
Multifamily 0.978 0.763 0.795
Job training 4.268* 2.868*
Free lunch 2.930* 2.346*
Energy assistance 6.374* 3.190*
WIC 3.260* 2.330*
Medicaid 10.794* 7.182*
CHIP 0.993 0.332*
SSI 2.129* 1.260
Source: GAO.
Note: Asterisks denote estimated odds ratios which, with 95 percent
confidence, are significantly different from 1. The logistic regression
analyses used CPS weights and included information that provided
approximate adjustments for the complex sample design of CPS.
These bivariate results demonstrate that, based on our estimates, food
stamp participation was more likely in eligible households in which the
benefits of participation were greater; that is, each $100 increase in
monthly benefits for which household members were eligible increased the
odds on participating by a factor of 1.31, or by 31 percent. Likely
eligible households with higher shelter expenses were, at the same time,
less likely to participate; each $100 increase in monthly shelter expenses
Appendix I: Methodology for Comparing Participating Working Families to
Likely Eligible Nonparticipating Working Families
decreased the odds on participating by a factor of 0.91. While households
with higher incomes were not significantly different from households with
lower incomes to participate, households with any nonearned income were
2.6 times as likely as those without any nonearned income to participate.
Larger households were also more likely to participate than smaller ones
(i.e., every additional person in the eligible household increases the
odds on participating by a factor of 1.1). While the presence of elderly
or married individuals in a household reduces the odds on participation by
roughly half, the presence of young children (under age 5) in the
household nearly doubles the odds of participating. Households consisting
of all black members (including black Hispanics) were nearly twice as
likely as families with all white (non-Hispanic) members to participate,
though there were no significant differences between households consisting
of other races and households that were all white. Households with any
noncitizen unit head, and households involving owned rather than rented
dwellings, were also less likely to be participating in food stamps than
other households.
Participation in the Food Stamp Program was also greatly affected by
whether the persons in the eligible household participate in other
programs. That is, the odds of participating were over 10 times higher for
those working households that received Medicaid benefits (than for those
who do not), over six times higher for those who received energy
assistance, and over four times higher for households in which someone was
receiving job training. Similarly, the odds of participating in the Food
Stamp Program were about three times higher for those working households
participating in free lunch programs or in WIC than for those not
participating in those programs, and they were roughly twice as great for
those who received any SSI benefits.
The first multivariate model (Model 1) provides estimates of the effects
of the various socioeconomic and demographic factors when they are
estimated simultaneously, using a multivariate logistic regression model.
While odds ratios estimating the different effect sizes change modestly in
some cases, most of the factors that appeared significant when they were
estimated from bivariate models remain significant when they are estimated
in a multivariate context and the effects of other factors are controlled.
Model 2 of the multivariate analysis shows the estimates of the effects of
participating in other programs, net of each other, and net of the effects
of the socioeconomic and demographic factors. Here too, most of these
effects remain consistent with what was found in the bivariate analyses,
Appendix I: Methodology for Comparing Participating Working Families to
Likely Eligible Nonparticipating Working Families
except that receiving SSI does not appear to affect Food Stamp Program
participation net of the other factors and, when other factors are
controlled, households involved in the Children's Health Insurance Program
appear to be only a third as likely as households that do not receive food
stamps. While our estimates of the effects of participating in other
programs on food stamp participation are somewhat attenuated or diminished
when they are estimated simultaneously, rather than independent of one
another, it remains the case that households, including someone who
receives Medicaid, energy assistance, or job training are the most likely
to receive food stamps. We believe that, these multivariate estimates of
the effects of program participation are, by virtue of being estimated
simultaneously and while controlling for the socioeconomic and demographic
characteristics of the eligible households, somewhat better estimates than
those obtained in our bivariate analyses.
Appendix II: Summary of Farm Bill Provisions
Option/ provision Description
Encouragement of payment of child Treats legally obligated child support
payments to a nonhousehold member as an income support (option) exclusion
rather than a deduction.
Simplified definition of income (option) Excludes types of income that
are not used to determine eligibility for TANF or Medicaid, with some
exceptions
Simplified definition of resources (option) Excludes certain types of
resources that the state does not count for TANF or Medicaid.
Simplified determination of housing costs Allows states to use a standard
deduction from income of $143 per month for homeless (option) households
with some shelter expenses
Simplified determination of deductions Disregard reported changes in
deductions during certification periods except for changes (option)
associated with a new residence or earned income until the next
recertification.
State option to reduce reporting Expand simplified/semiannual reporting
systems to most households, not just requirements (option) those with
earned income.
Transitional food stamps for families Continue food stamp benefits to
households for up to 5 months after they lose moving from welfare (option)
TANF cash assistance.
Simplified utility allowance (option) Simplifies the Standard Utility
Allowance to promote its use.
Alternative procedures for residents of Pilot project to assess
feasibility of issuing standardized rather than individual benefits to
certain group faculties
certain residents of group homes.
Availability of food stamp program Require state agencies that have a Web
site to post applications on these sites. applications on the Internet
Grants for simple application and eligibility Authorizes up to $5 million
annually to pay for projects to improve access for food stampdetermination
systems and improved eligible households or to develop and implement
simplified application and eligibility access to benefits systems.
Reform of quality control (QC) system This provision makes substantial
changes to the QC system that measures states' payment accuracy in issuing
food stamp benefits. Only those states with persistently high error rates
would face liabilities.
Bonuses for states that demonstrate high Creates a performance system that
will award $48 million in bonuses each year to states or most improved
performance with high or improved performance for actions taken to correct
errors, reduce the rates of error, and improve eligibility determinations.
Partial restoration of benefits to legal This provision restores food
stamp eligibility on certain dates to qualified aliens who are immigrants
otherwise eligible and meet criteria laid out in the legislation.
Source: Section-By-Section Summary of Provisions Affecting Food Stamp
Provisions. Compiled by USDA's Food and Nutrition Service.
Note: Bolded provisions are those we identified as having the potential to
have particularly positive impact on participation among working families.
Appendix III: GAO Contacts and Acknowledgments
GAO Contacts Kay Brown, (202) 512-3674, [email protected] Kevin Kumanga,
(202) 512-4962, [email protected]
Acknowledgments Bob Kolasky and Thaddeus Hackworth also made significant
contributions to this report. In addition, Paula Bonin, Robert DeRoy,
Kevin Jackson, Beverly Ross, Sidney Schwartz, and Douglas Sloane produced
our estimates of participation among working families, and Corinna
Nicolaou assisted in the message and report development.
Related GAO Products
Welfare Reform: Information on Changing Labor Market and State Fiscal
Conditions. GAO-03-977. Washington, D.C.: July 15, 2003.
Food Stamp Employment and Training Program: Better Data Needed to
Understand Who Is Served and What the Program Achieves. GAO-03-388.
Washington, D.C.: March 12, 2003.
Workforce Investment Act: States and Localities Increasingly Coordinate
Services for TANF Clients, but Better Information Needed on Effective
Approaches. GAO-02-696. Washington, D.C.: July 3, 2002.
Welfare Reform: States Provide TANF-Funded Services to Many Low-Income
Families Who Do Not Receive Cash Assistance. GAO-02-564. Washington, D.C.:
April 5, 2002.
Food Stamp Program: States' Use of Options and Waivers to Improve Program
Administration and Promote Access. GAO-02-409. Washington, D.C.: February
22, 2002.
Human Services Integration: Results of a GAO Cosponsored Conference on
Modernizing Information Systems. GAO-02-121. Washington, D.C.: January 31,
2002.
Earned Income Tax Credit Eligibility and Participation. GAO-02-290R.
Washington, D.C.: December 14, 2001.
Means-Tested Programs: Determining Financial Eligibility Is Cumbersome and
Can Be Simplified. GAO-02-58. Washington, D.C.: November 2, 2001.
Food Assistance: Options for Improving Nutrition for Older Americans.
GAO/RCED-00-238. Washington, D.C.: August 17, 2000.
Food Stamp Program: Better Use of Electronic Data Could Result in
Disqualifying More Recipients Who Traffic Benefits. GAO-RCED-00-61.
Washington, D.C.: March 7, 2000.
Food Stamp Program: Various Factors Have Led to Declining Participation.
GAO/RCED-99-185. Washington, D.C.: July, 1999.
Related GAO Products
Food Stamp Program: Storeowners Seldom Pay Financial Penalties
Owed for Program Violations. GAO/RCED-99-91. Washington, D.C.: May
11, 1999
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