The test will be expensive and discourage efforts to become financially independent.
The Pennsylvania Department of Public Welfare’s (DPW) final proposal to reinstate an asset test for recipients of the federal Supplemental Nutrition and Assistance Program (SNAP) is only likely to harm the people that the test was meant to protect — and rather than saving Pennsylvania money, it will probably cost more money over time than the current test.
SNAP, the new name for the Food Stamp Program, is a federally funded program that helps low-income Americans purchase food at participating supermarkets and retailers.
Pennsylvania used an asset test to determine SNAP eligibility until 2008, when the onset of the recession prompted the state to eliminate the test in an effort to relieve increasing economic burdens faced by low-income Pennsylvanians.
The economy, however, has not fully recovered, and it is unclear what exactly reinstating an asset test will accomplish. DPW predicates its new policy on the idea that an asset test will save limited taxpayer resources and will ensure that every SNAP dollar is channeled to those who are truly in need.
DPW originally proposed reinstating tests that would limit SNAP eligibility to households with fewer than $2,000 in assets, or $3,250 for households with members who are disabled or at least 60 years old.
DPW revised its asset test limits reportedly in response to criticism from advocacy groups, newspapers, and even Mayor Michael Nutter. The final asset test proposal limits eligibility to households with $5,500 in assets, or $9,000 for households with members who are disabled or at least 60 years old.
An asset test would penalize families for saving too much money, or for possessing too many non-exempt assets. Families at the edge of the eligibility threshold would have no incentive to save money, and families with too many assets would eventually be forced into SNAP after exhausting personal resources. The opportunity and incentive to become SNAP ineligible will be significantly diminished.
Furthermore, reinstating the test will be expensive. The federal government provides nearly half of the state’s SNAP-associated administrative costs, but it does not cover asset tests. The asset test will therefore cost the state directly – and in the long run may cost more than it “saves.”
Mark Mitchell is an Editor of The Regulatory Review and a Master of Public Administration student at the University of Pennsylvania’s Fels Institute of Government.