Sneak Preview: Bill Calls for States To Draw up EBT Prohibitions

May 4, 2012 | By Jerry Ashworth | Post a Comment

(The following was excerpted from an article in the Federal Grants Management Handbook.) Although it has not become law yet, a bill in Congress would create a deadline for states to prohibit welfare recipients from accessing electronic benefits in certain establishments or those states could risk losing federal grant funds.

The Welfare Integrity Now Act (H.R. 3567) has passed the House and is working its way through the Senate. The bill would prohibit Temporary Assistance for Needy Families recipients from using electronic benefits transfer (EBT) debit cards at ATMs in casinos, liquor stores and strip clubs. States would be required to implement policies by Feb. 21, 2014, restricting such usage. Those that fail to do so would have their TANF funds cut by 5 percent a year until they meet the requirements.

“The bill is intended to curb improper use of TANF benefits,” Robert Ek, senior policy associate with the American Public Human Services Association, recently told the National Association of Counties 2012 Legislative Conference. He said the bill resulted from concerns about welfare recipients using benefits to gamble and purchase alcohol. Although federal legislators want to prevent recipients from using TANF benefits in this manner, “from the states point of view, the percentage of that kind of activity is very small,” Ek noted.

Ek said that if the bill became law, it could conflict with state policies now in place prohibiting EBT card usage at casinos, liquor stores and strip clubs. APHSA officials argued that TANF currently offers states enough flexibility to deal with the issue without a federal law.


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