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PPI Intern1 feb29fsregs_access.wpo
Page 54
V.
REDUCING VERIFICATION BURDENS ON STATES AND
HOUSEHOLDS
As USDA notes at various points in the preamble, pressure from states is the primary
driving force behind its proposals to make it easier to deny food stamp applications and to allow
states to require households to produce more verification and apply for recertification more
frequently. States' interest in this area, in turn, is largely the result of pressure from the food
stamp quality control (QC) system, which imposes fiscal penalties upon states with error rates that
exceed the national average. States' increasing efforts to impose procedural demands on
households, and their unhappiness at the continuation of important procedural protections, likely
would be tempered if states felt they could operate less rigorous systems without exposing
themselves to QC sanctions.
Under food stamp QC, a sample of cases in which the state issued food stamps is closely
scrutinized several months later. If it is determined that the household received too many or too
few benefits (or that the household was ineligible), QC determines the amount of the difference
and projects an error rate for the state from the sample. In well over half of all cases QC
identifies as errors, the food stamp office acted properly given the information it had; the error
occurs because of circumstances that were different from what the food stamp office in good faith
believed them to be. For example, if a household member worked substantial overtime in a month
and did not report it to the food stamp office, QC will still find the case to be in error because the
household's additional earnings would have reduced the food stamp allotment had they been
included in the benefit calculation. Thus, to avoid a high error rate a food stamp office must not
only act correctly upon the information it has but must also take steps to ensure that it has as
much information as possible from households.
Because QC can impose sanctions whenever a state's error rate exceeds the national
average, and because the calculation of error rates is subject to substantial statistical fluctuation,
over thirty states each year are either subject to or at risk of QC sanctions. In addition, because
the QC system offers enhanced funding for states with error rates below six percent, a number of
states not at immediate risk of sanctions nonetheless are pressing to lower their error rates further
to qualify for these payments (which can raise the federal share of food stamp administrative costs
from the usual 50 percent up as high as 60 percent). Thus, the overwhelming majority of states
have strong incentives for imposing strong pressure on applicant and recipient households to
disclose all relevant information and for rigorously verifying most information the household
supplies at frequent intervals.
The pressure QC puts on states to demand exhaustive verification, and to require
households to reapply frequently for benefits, is at odds with the goals of reducing the burdens
imposed on eligible low-income households seeking to participate. Indeed, the conflict is worst
with regard to the working poor, whose incomes tend to fluctuate from month to month. Some
states identify large groups of the working poor in their "error-prone profiles," target them for
particularly extensive verification, and require them to apply for recertification every three
months. Similarly, since households leaving cash assistance may have unstable circumstances,
they are often regarded as "error-prone" and required to reapply and to reverify their
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"ocrText": "PPI Intern1 feb29fsregs_access.wpo\nPage 54\nV.\nREDUCING VERIFICATION BURDENS ON STATES AND\nHOUSEHOLDS\nAs USDA notes at various points in the preamble, pressure from states is the primary\ndriving force behind its proposals to make it easier to deny food stamp applications and to allow\nstates to require households to produce more verification and apply for recertification more\nfrequently. States' interest in this area, in turn, is largely the result of pressure from the food\nstamp quality control (QC) system, which imposes fiscal penalties upon states with error rates that\nexceed the national average. States' increasing efforts to impose procedural demands on\nhouseholds, and their unhappiness at the continuation of important procedural protections, likely\nwould be tempered if states felt they could operate less rigorous systems without exposing\nthemselves to QC sanctions.\nUnder food stamp QC, a sample of cases in which the state issued food stamps is closely\nscrutinized several months later. If it is determined that the household received too many or too\nfew benefits (or that the household was ineligible), QC determines the amount of the difference\nand projects an error rate for the state from the sample. In well over half of all cases QC\nidentifies as errors, the food stamp office acted properly given the information it had; the error\noccurs because of circumstances that were different from what the food stamp office in good faith\nbelieved them to be. For example, if a household member worked substantial overtime in a month\nand did not report it to the food stamp office, QC will still find the case to be in error because the\nhousehold's additional earnings would have reduced the food stamp allotment had they been\nincluded in the benefit calculation. Thus, to avoid a high error rate a food stamp office must not\nonly act correctly upon the information it has but must also take steps to ensure that it has as\nmuch information as possible from households.\nBecause QC can impose sanctions whenever a state's error rate exceeds the national\naverage, and because the calculation of error rates is subject to substantial statistical fluctuation,\nover thirty states each year are either subject to or at risk of QC sanctions. In addition, because\nthe QC system offers enhanced funding for states with error rates below six percent, a number of\nstates not at immediate risk of sanctions nonetheless are pressing to lower their error rates further\nto qualify for these payments (which can raise the federal share of food stamp administrative costs\nfrom the usual 50 percent up as high as 60 percent). Thus, the overwhelming majority of states\nhave strong incentives for imposing strong pressure on applicant and recipient households to\ndisclose all relevant information and for rigorously verifying most information the household\nsupplies at frequent intervals.\nThe pressure QC puts on states to demand exhaustive verification, and to require\nhouseholds to reapply frequently for benefits, is at odds with the goals of reducing the burdens\nimposed on eligible low-income households seeking to participate. Indeed, the conflict is worst\nwith regard to the working poor, whose incomes tend to fluctuate from month to month. Some\nstates identify large groups of the working poor in their \"error-prone profiles,\" target them for\nparticularly extensive verification, and require them to apply for recertification every three\nmonths. Similarly, since households leaving cash assistance may have unstable circumstances,\nthey are often regarded as \"error-prone\" and required to reapply and to reverify their"
}