Slight shift on EBT cards
New regulations included in New Hampshire’s 2014 fiscal year budget will restrict residents from using Electronic Benefits Transfer cards — or cash obtained by using those cards at automatic teller machines — at liquor stores, casinos or strip clubs. But even a state official in charge of monitoring the EBT system says the change will probably have little impact. And critics of the EBT program are calling for tighter restrictions.
EBT cards are essentially debit cards issued to those who qualify for public assistance. The cards can be used in two ways, according to Terry Smith, director of the Division of Family Assistance for the N.H. Dept. of Health and Human Services. Authorized retailers have an EBT button that is activated when the cards are used as food stamps, and store clerks can monitor the card to identify whether the products purchased are legitimate under the food stamp program.
“Stores have to be certified to accept food stamps,” Smith said on Tuesday. “Retailers are trained on what can be purchased and what can’t. It’s a person doing the checking.”
The cards can also be used at ATMs to make cash withdrawals.
“The technology doesn’t provide the tools to monitor how that [cash] is used,” Smith said .
According to federal law, Smith said, states will now be responsible for ensuring that clients do not use their benefits in liquor stores, casinos or adult entertainment establishments “where performers disrobe or perform in an unclothed state.” That federal regulation prompted a last-minute change to the state’s recent budget bill to bring New Hampshire into compliance. Smith said grocery stores that sell beer or wine or lottery cards are not affected by the law.
According to the law, holders of EBT cards are not allowed to use the cash they obtain from an ATM in any of the prohibited establishments.
“I think businesses will be diligent,” Smith said. “We have posters up about this and we have discussions with clients about the appropriate use of cash. We completely agree that benefits should be used only for life essentials.”
While it will be difficult to enforce the new regulation when it comes to withdrawals of money from ATMs, Smith said, there are penalties that would discourage cardholders from violating the law. A first offense will mean a suspension of benefits for one month; a second offense a suspension for two months; and a third offense will be loss of benefits for three months.
In fiscal year 2013, the state paid out $39,765,236 in family assistance benefits, according to numbers supplied by Smith. Of that amount, $22,885,820 was temporary assistance to 3,683 needy families — the welfare program for children and parents; $13,243,194 went to assist 7,841 permanently and totally disabled clients; $2,805,199 went to 1,453 poor elderly clients; $310,561 was spent on aid to 155 needy and blind residents; $520,463 was refugee cash assistance, which Smith said is available for a limited time to refugees who are not eligible for other state assistance programs.
“People should be aware that 90 percent of the assistance to needy families goes to single mothers,” Smith said. “The maximum cash grant is $695 a month. That’s less than the average needed for rent.”
Smith said suggestions that clients should have to pay for everything electronically, rather than by getting cash using their card, are impractical. Many of the people clients need to pay, such as landlords, child care providers and laundromats, can’t take electronic payments, he said.
But others think that change is just what is needed.
“I understand the efficiency of having a card,” said N.H. State Representative and former Speaker of the House Bill O’Brien (R- Mont Vernon) on Wednesday. “We’re trying to make sure people can meet the necessities of life. It’s a proper limitation to say you have to use it for food, shelter, medical care — the basic necessities of life. We should find a way to use it as a credit card, but not to get cash.”
O’Brien said he had been working on a bill to place restrictions on the use of the cards prior to last year’s election. After the Republicans lost their majority in the House, the bill was put on hold, but O’Brien said he has had discussions with others in his party about submitting it again.
Jackie Whiton of Antrim drew national attention last year after she quit her job at a Peterborough convenience store rather than sell cigarettes to a man with an EBT cash card. She said the new restrictions are insignificant.
“It’s not a real change. You can still go to an ATM and get money,” Whiton said Tuesday. “I don’t think there’s any great advantage to the taxpayers.”
After she left her job, Whiton started circulating a petition calling for the elimination of the option to use EBT cards at ATMs. She met with O’Brien last summer and she said she now has about 1,300 names on the petition.
“I haven’t given it to anyone yet,” Whiton said about the petition. “I’ve talked to the Governor’s Office. I just don’t feel there’s much of a handle on what they’re going to curtail.”
Smith said six states have restricted cash access through the use of EBT cards, but New Hampshire has not.
“Would it save money? No,” Smith said.
But the job of the Dept. of Health and Human Services is essentially to implement the law, he said, and the laws on public assistance change frequently, at both the federal and state level.
“Programs like welfare are the result of the communities’ will, as they are expressed through the Legislature,” Smith said.
Dave Anderson can be reached at 924-7172, ext. 233 or email@example.com. He’s on Twitter at @DaveAndersonMLT.