Evaluating Food Assistance Programs in an Era of Welfare Reform: Summary of a Workshop (1999)

The Food and Nutrition Service (FNS) administers the 15 food assistance programs of the U.S. Department of Agriculture (USDA), which represent a safety net for people in need. The goals of the programs are to provide needy persons with access to a more nutritious diet, to improve the eating habits of the nation's children, and to help U.S. farmers by providing an outlet for the distribution of foods purchased under farmer's assistance programs.

The major food assistance programs are the Food Stamp Program; the Special Supplemental Nutrition Program for Women, Infants, and Children (WIC); and the National School Lunch Program and the School Breakfast Program. The smaller programs include the Child and Adult Care Food Program; the Summer Food Service Program; the Food Distribution Program on Indian Reservations; the Commodity Supplemental Food Program; the Special Milk Program; the Homeless Children Nutrition Program; the Nutrition Program for the Elderly; the Emergency Food Assistance Program; the Nutrition Assistance Programs in Puerto Rico, American Samoa, and the Commonwealth of the Northern Marianas Islands; the WIC Farmers Market Nutrition Program; and the Nutrition Education and Training Program. Descriptions of the programs appear below.¹ Table 2-1 lists participation rates and costs of the various programs.

The Food Stamp Program, the largest of the food assistance programs, provides access to a healthy diet to millions of families with children. The program initially began in the 1930s, with a limited program in effect from 1939 to 1943. In 1961, it was revived as a pilot program and then fully implemented nationwide in 1974. The main goal of the Food Stamp Program is to alleviate hunger and malnutrition by permitting low-income households to obtain a more nutritious diet through ordinary retail channels. The Food Stamp Program provides households with monthly allotments of coupons that can be used like cash at most grocery stores. The program also uses electronic benefits transfer, through which recipients use a plastic card similar to a bank card to transfer funds from a food stamp benefits account to a retailer's account. Electronic benefits transfer eliminates paper food stamps and creates an electronic record for each transaction, which makes fraud easier to detect. The federal government funds the benefits provided through the Food Stamp Program and shares the cost of administrative expenses with the states. Eligibility and allotments are based on household size, income, assets, and other factors. Food stamp benefits are based on the Thrifty Food Plan, USDA's estimate of the cost to purchase a market-basket list of particular kinds and amounts of food that make up a model diet plan, based on the National Academy of Sciences' recommended dietary allowances (RDAs) and on food choices of low-income households.

The Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) offers supplemental foods, nutrition education, and health and social service referrals to low-income pregnant and postpartum women and their infants and children up to age 5. WIC is intended to improve the health of pregnant women, new mothers, and their infants. WIC participants receive vouchers that allow them to purchase a monthly package of supplemental foods that are high in protein, calcium, iron, and vitamins A and C, the nutrients frequently lacking in the diets of the program's target population. Different food packages are provided for different categories of participants. Recipients must meet income guidelines and state residence requirements and must be individually determined by a health professional to be at nutritional risk. Nutritional risk includes medically based risks, such as anemia, and diet-based risks, such as inadequate dietary patterns (Institute of Medicine, 1996). To be eligible for program participation, an applicant's income must be less than 185 percent of the poverty line set by U.S. poverty income guidelines. The poverty income guideline in 1998 for a family of two adults and two children was $16,450 (U.S. Department of Health and Human Services, 1998).

The National School Lunch Program and the School Breakfast Program provide cash reimbursements and distribute commodity foods to participating public and private schools and to nonprofit residential institutions that serve meals to children. Participation is based on income: children from households with family incomes at or less than 130 percent of the federal poverty line are eligible to receive free meals; children from families with incomes between 130

and 185 percent of the poverty line are eligible to receive meals at a reduced price. Schools are reimbursed for meal costs based on the number of children participating in the program and a small subsidy is provided to the schools for meals for children who do not apply for, or whose family income does not qualify them for, free or reduced-price meals. Nearly all of the nation's public schools and 20 percent of private schools participate in the school lunch program. More than 70 percent of schools participate in the school breakfast program.

The Child and Adult Care Food Program provides healthy meals and snacks that are served in child and adult day care centers and in family and group day care homes for children. This program ensures that children and adults in day care receive healthy meals by reimbursing participating day care operators for their meal costs and providing them with USDA commodity foods. Most child and adult care centers include meals as a part of their fees. Centers that participate in the program are reimbursed for meals based on whether the children or adults in their care are eligible for free or reduced-price meals or pay the full price. Those from families with incomes at or below 130 percent of the poverty line may qualify for free meals; those from families with incomes between 130 percent and 185 percent of the poverty level may qualify for reduced-price meals; and those from families with incomes more than 185 percent of the poverty line pay full price.

The Summer Food Service Program serves free meals to 2.2 million children from low-income families during school vacation periods. Meals are provided at a central site, such as a school or community center. Participants may receive up to three meals per day.

The Food Distribution Program on Indian Reservations provides commodity foods² to low-income households on Indian reservations and to Native American families residing in designated areas near reservations. Many Native Americans participate in this program as an alternative to the Food Stamp Program if they do not have easy access to retail food stores. The program is administered at the federal level by FNS, in cooperation with six state agencies and 94 Indian tribal organizations. USDA purchases and ships commodities to the administering agencies based on their orders. These agencies store and distribute the food, determine applicant eligibility, and provide nutrition education to recipients on 218 Indian reservations and communities. USDA also provides the state and tribal agencies with funds for program administrative costs.

The Commodity Supplemental Food Program provides food and administrative support funds to states to supplement the diets of infants in low-income families; children up to age 6 years old; pregnant, postpartum, and breastfeeding

women; and persons 60 years of age and older. The population served is similar to that served by WIC, but the program also serves elderly people and provides food rather than the food vouchers that WIC participants receive. Eligible people cannot participate in both programs at the same time. The food packages supplied do not provide a complete diet but rather are good sources of the nutrients typically lacking in the diets of the target population.

The Special Milk Program, begun in 1955, provides milk to children in schools and child care institutions that do not participate in other federal child-nutrition meal service programs. The program reimburses schools for the milk they serve. Schools in the National School Lunch or School Breakfast Programs may also participate in this program to provide milk to children in half-day prekindergarten and kindergarten programs, for children who do not have access to the school meal programs.

The Homeless Children Nutrition Program reimburses providers for nutritious meals served to homeless preschool-age children in emergency shelters. First established as a demonstration project in 1989, the program was made permanent in 1994.

The Nutrition Program for the Elderly helps provide elderly persons with nutritionally sound meals through Meals On Wheels programs or in senior citizens' centers and similar group settings. The U.S. Department of Health and Human Services (DHHS) administers this program but it receives commodity foods and financial support from FNS. Age is the only factor used in determining eligibility. People 60 years of age or older and their spouses (regardless of their age) are eligible for benefits. In addition, people with disabilities who live in elderly housing facilities, persons who accompany elderly participants to congregate feeding sites, and volunteers who assist in the meal service may also receive meals through this program. Indian tribal organizations may select an age younger than 60 years for defining an ''older" person for their tribes. There is no income requirement to receive meals under this program. Each recipient may contribute as much as he or she wishes toward the cost of the meal, but meals are free to those who cannot make any contribution. Under this program, FNS provides cash reimbursements or commodity foods to state agencies, which pass them on to agencies or organizations that serve meals through DHHS programs. To qualify for cash or commodity assistance, the meals served must meet a specified percentage of the nutrients as prescribed by the RDAs.

The Emergency Food Assistance Program helps to supplement the diets of low-income Americans by providing them with healthful foods at no cost. Under this program, USDA makes commodity foods available to states. States provide the food to local agencies such as food banks, for distribution to households or to organizations that prepare and provide meals for needy people. The types of commodity foods USDA purchases for distribution vary depending on the preferences of states and agricultural market conditions. Recipients of food for home use must meet program eligibility criteria set by the states. Organizations that

provide prepared meals are eligible to receive commodities if they can demonstrate that they serve predominantly needy persons.

FNS also administers a Nutrition Assistance Program in Puerto Rico, American Samoa, and the Commonwealth of the Northern Marianas Islands. The Food Stamp Program in Puerto Rico was replaced in 1982 by a block grant program. The food assistance program in American Samoa and the Northern Marianas Islands in the Pacific also provides benefits under block grants. The territories provide cash and coupons to participants rather than food or food stamps.

The WIC Farmers' Market Nutrition Program, established in 1992, provides additional coupons to WIC participants that they can use to purchase fresh fruits and vegetables at participating farmers' markets. The program is funded through a congressionally mandated set-aside in the WIC appropriation. The program has two goals: (1) to provide fresh, nutritious, unprepared food, such as fruits and vegetables, from farmers' markets to WIC participants who are at nutritional risk and (2) to expand consumers' awareness and use of farmers' markets. This program, operated in conjunction with the regular WIC program, is offered in 32 states, the District of Columbia, and two Indian tribal organizations. State agencies may limit sales to specific foods that are locally grown to encourage participants to support the farmers in their own state.

FNS operates the Nutrition Education and Training Program to support nutrition education in the food assistance programs for children. The secretary of agriculture allocates funds to states each year in the form of grants. The legislative purpose of the program is to "encourage effective dissemination of scientifically valid information to children participating or eligible to participate in the school lunch and related child nutrition programs" (Kalina et al., 1989). Through its Team Nutrition, FNS also provides schools with nutrition education materials and other support for children, technical assistance for food service professional staffs, and nutrition education materials for other food assistance programs, such as the Food Stamp Program and WIC.

Public Law 104-193, the Personal Responsibility and Work Opportunity Reconciliation Act (PRWORA), was signed by President Clinton on August 22, 1996. PRWORA, a comprehensive welfare reform plan, contained numerous provisions that affect the nation's current welfare system. PRWORA replaced the federal entitlement program AFDC with Temporary Assistance for Needy Families (TANF), a fixed block grant program that allows states to set their own eligibility standards and benefit levels for individuals. States receive a fixed level of resources for income support and work programs based on what they spent on these programs in previous years. Nationally, the TANF level is set at $16.4 billion, and no further increases are provided for in the act. The act

provides for additional grants to states as bonus rewards for reductions in illegitimate births and for high performance under TANF as well as supplemental grants to certain states to accommodate population increases.

TANF has shifted responsibility for program design to the state and local levels, leading to considerable program diversity and changes in the amount of benefits received and the characteristics of the eligible population. All states were required to submit their plans to DHHS and to begin implementing the TANF block grant by July 1, 1997. States have adopted wide-ranging options regarding work exemptions, sanctions for noncompliance with work requirements, and time limits on assistance. For example, the five-year federal time limit can be and has been further shortened in many states, and many states require that applicants seek employment before being given assistance.

The effects of PRWORA are certain to be extensive and far-reaching and they are only beginning to be identified.³ One effect that is already being observed since the passage of the act is a decline in welfare caseloads. Although the number of cases was decreasing prior to PRWORA and before implementa-

tion of program changes, the caseload decline has been far more rapid since August 1996. The decline prior to passage of PRWORA took place in a relatively strong economy, which continued, making it difficult to attribute any part to the effects of welfare reform. As the caseloads continue to decline, it becomes critical to continue to follow these families in order to understand what happens to those who leave the welfare system.

Although PRWORA retained the Food Stamp Program as a federal entitlement program, it made many structural changes in the administration and implementation of the program.⁴ The changes were to enhance state flexibility, simplify program administration, strengthen program integrity, and encourage the expansion of electronic benefits transfer (Carlson, 1996). PRWORA put into effect strict time limits on food stamp assistance for able-bodied childless people between the ages of 18 and 50. These people can receive benefits only for 3 months in every 36-month period unless they are working half-time or participating in a job program half-time. People who refuse to work, who refuse to cooperate with a determination of job status or availability, who refuse to participate in job-training programs, who reduce their employment to less than 30 hours per week, or who voluntarily quit a job with no legally justifiable reason are automatically ineligible for participation in the Food Stamp Program. The level of maximum food stamp benefit has been reduced to 100 percent of the Thrifty Food Plan from 103 percent and the standard deduction used in calculating food stamp benefits is fixed. The act originally had provisions barring most legal immigrants from participating in the Food Stamp Program unless they become citizens. In 1997, however, PRWORA was amended to allow states to purchase food stamps from the federal government for use in a state-funded food assistance program for legal immigrants. In 1997, 13 states had approved plans to provide food assistance to immigrants, and it is expected that additional states will adopt similar plans. Through the original PRWORA provisions, Food Stamp Program funding was to be cut by more than $24 billion from baseline projections through FY2002. A portion of the $24 billion, however, has been restored, mostly by making more immigrants eligible again, and allowing states the option to submit waivers that would exempt a portion of their population of able-bodied adults without dependents from the time limit and work requirements.

Under the PRWORA provisions permitting state flexibility, states can set more stringent penalties for noncompliance with program rules and more strin-

gent minimum disqualification periods for lack of work activity. The act broadens food stamp waiver authority and provides for a number of state options in the implementation of the Food Stamp Program. States can use these waivers and options as they establish their cash assistance programs and the Food Stamp Program, provided that several features of the national Food Stamp Program are maintained. Examples of permissible projects are those that will improve the administration of the program, increase the self-sufficiency of food stamp recipients, test innovative welfare reform strategies, or allow greater conformity with the rules of other programs. A project cannot include more than 15 percent of the state's population and must be limited to five years. States are encouraged to conduct evaluation of these waiver projects. In addition, PRWORA contains the provision that USDA conduct a study of the use of food stamps for vitamin and mineral purchases.

PRWORA allows states to establish a "simplified food stamp program" to help align their cash assistance rules with the Food Stamp Program rules. The simplified food stamp program allows households that are also receiving cash assistance under TANF to have automatic eligibility for food stamps. In this simplified option, states can enforce a combination of TANF and food stamp rules to determine benefit levels for these households.

The act allows states to establish work supplementation or support programs whereby the value of food stamp benefits is provided to employers as a wage subsidy to be used for hiring and employing recipients. PRWORA specifies that the participant shall not receive separate food stamp benefits while participating in a work supplementation program, unless the wages paid are less than the food stamp allotment. Some states also have the option to "cash-out" food stamp benefits (i.e., provide benefits in the form of cash rather than coupons) to individuals who have worked in unsubsidized employment for at least 90 days, earned at least $350 a month, and receive benefits under TANF. The states that may choose this option are those in which at least 50 percent of the food stamp households also received AFDC during summer 1993.

PRWORA helps protect the integrity of the Food Stamp Program through provisions that guard against fraud and abuse. The act ensures that only legitimate stores participate in the program, improves the USDA's ability to monitor authorized stores, and strengthens penalties against retailers and recipients who violate the program. For instance, disqualification penalties have been doubled for those caught committing food stamp fraud and a 10-year disqualification has been put in place for those attempting to receive benefits in more than one state at a time. The act requires states to implement electronic benefit transfer systems by 2002, although states that face implementation barriers may receive a waiver. As mentioned earlier, electronic benefit transfer eliminates paper food stamps and creates an electronic record for each transaction, which makes fraud easier to detect.

PRWORA also made major changes in WIC and the Child and Adult Care

Food Programs. The act allows states the option of excluding immigrants from WIC participation. PRWORA eliminated the requirements that USDA conduct outreach for the WIC program and that WIC services and materials be provided in languages other than English. It also established a two-tiered system of reimbursement under the Child and Adult Care Food Program. Current-law rates will continue for child care centers that are located in areas in which at least 50 percent of the children live in households with incomes less than 185 percent of the poverty level or centers that are operated by a provider whose income is less than 185 percent of the poverty level. Child care centers that do not meet either of these requirements will receive reduced meal reimbursements. The option of serving an additional meal or snack to children who are in child care centers more than eight hours a day has been eliminated. The requirements and resources for outreach programs directed toward increasing the participation of children from lower-income families have also been eliminated.

The other food assistance programs also saw changes as a result of PRWORA. States can enforce the immigration restrictions set up in other programs in the Summer Food Program. All children eligible to attend school, which includes legal immigrants, can still participate in the school breakfast and lunch programs. The lunch reimbursement of the Summer Food Program was reduced and start-up funds for the program were eliminated, as were start-up funds for the School Breakfast Program, which had been used to encourage participation.