Dive Brief:
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Agriculture Secretary Sonny Perdue wants some recipients of food stamp benefits to be required to work for them, according to The Wall Street Journal. He said Wednesday during a visit to Pennsylvania that such a provision regarding the Supplemental Nutrition Assistance Program, or SNAP, would be key to renegotiating the $900-billion farm bill, which expires at the end of September.
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The Trump administration budget calls for slashing discretionary spending by 21% at the Agriculture Department, trimming crop insurance coverage, and cutting the SNAP program by more than $190 billion over 10 years. Food stamps, along with other nutrition-related programs, make up the majority of the farm bill's budget.
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The farm bill is scheduled to be reauthorized this year for five years, and the House has set a deadline of October for getting that done. However, the current farm bill took three years beyond its original schedule to be passed.
Dive Insight:
During negotiations over the 2014 farm bill, some in Congress wanted to require adults aged 18-50 without minor children to either work, or be in a work-training program, if they wanted SNAP benefits. Critics said if such a provision had passed, millions of recipients would have not gotten food stamps. The 2014 farm bill was cut by $8 billion, but the Trump budget proposal seeks to reduce it by $228 billion over 10 years, including cutting SNAP by more than 25% and taking out billions in farm subsidies.
Some big grocery retailers, such as Walmart, have a big chunk of shoppers who are SNAP recipients. If enough of those people have their benefits cut under the new farm bill, it could hit grocery chains hard, along with food stamp recipients.
To illustrate the importance of low-income SNAP shoppers, Walmart piloted an online grocery purchasing program last fall in five markets. And this year, FreshDirect, Safeway, ShopRite and Hy-Vee are piloting online programs in Washington, Oregon, Pennsylvania and Iowa. It will be the first time SNAP has accepted online grocery payments, according to The Seattle Times.
A November 2016 report contracted by USDA analyzed the types of foods members of SNAP households buy at grocery stores, supermarkets and combination food and drug stores. The point-of-sale data, collected in 2011, showed that food purchases were similar to households whose members don't use food stamps.
Across the board, "households spent about 40 cents of every dollar of food expenditures on basic items" and another 40 cents went toward "cereal, prepared foods, dairy products, rice, and beans." Beverages, desserts and snacks accounted for the last 20 cents, the report stated.
This flies in the face of retailers who typically shy away from promoting products available to SNAP customers. The perception is that these customers don't spend enough to make such promotions worthwhile and that calling out these items might lessen their appeal to customers who aren't as price sensitive.
But, depending on the market, promoting SNAP-eligible items could pay off. There are about 44.2 million SNAP consumers in the U.S. who received about $66 billion in food stamps last year.
The new farm bill is likely to face partisan gridlock, which means it could be a tough slog getting to an agreement by the October deadline, or by the end of this year. There's also the midterm elections coming up on Nov. 6, which will prove to be a major distraction to the business of government. And, should the Republicans lose their majority in either the U.S. Senate or the House of Representatives, it's possible that the final farm bill could come out looking a lot different than it does now.