Supplemental Nutrition Assistance Program (SNAP): Eligibility, Certification, and Employment and Training Provisions of the Food, Conservation and Energy Act of 2008

AGENCY:

Food and Nutrition Service (FNS), USDA.

ACTION:

Final rule.

SUMMARY:

This final rule amends the SNAP regulations to update procedures for accessing SNAP benefits in drug addiction or alcoholic treatment centers (DAA treatment centers) and group living arrangements (GLAs) through electronic benefit transfer (EBT). The final rule implements the changes indicated in the proposed rule, but never finalized, regarding accessing SNAP benefits in these centers, but does not incorporate any of the substantive changes in the interim final rule regarding how benefits are returned to clients departing these centers due to adverse comments received on the interim final rule. This final rule also implements provisions of the Food, Conservation and Energy Act of 2008 regarding nomenclature changes to reflect the electronic issuance of benefits through EBT at these centers. RIN 0584-AE54 is a continuation of the prior rulemakings published under RIN 0584-AD87.

DATES:

This final rule is effective April 22, 2019.

FOR FURTHER INFORMATION CONTACT:

Mary Rose Conroy, Chief, Program Design Branch, Program Development Division, FNS, USDA, 3101 Park Center Drive, Alexandria, Virginia 22302, (703) 305-2803; MaryRose.Conroy@fns.usda.gov.

SUPPLEMENTARY INFORMATION:

Background

On May 4, 2011, the Department published a proposed rule (76 FR 25414) that would revise 7 CFR part 273 to change the program name from the Food Stamp Program to SNAP and make other nomenclature changes in conformance with Section 4001 of the Food, Conservation and Energy Act of 2008 (Pub. L. 110-246). As part of these nomenclature changes, the Department also proposed to revise § 273.11(e) and (f) to remove references to paper coupons and to update the procedures for providing benefits via EBT cards to residents of drug addiction or alcoholic treatment and rehabilitation programs (DAA treatment centers) and residents of group living arrangements (GLAs). Prior to the implementation of EBT, such centers were required to redeem residents' paper coupons through authorized food stores. Under EBT systems, both DAA treatment centers and GLAs may be authorized as retailers in order to redeem benefits directly through a financial institution. The institutions may also use an aggregate EBT card, or may use individual EBT cards at authorized stores if the center is the household's authorized representative. The Department proposed to update the regulatory description to conform with current EBT processes.

Commenters responding to the nomenclature changes in the proposed rule recommended additional substantive revisions to § 273.11(e) and (f) to better protect the rights of SNAP clients who are residents of DAA treatment centers and GLAs when these clients leave these establishments. Accordingly, in addition to finalizing the nomenclature updates for those particular provisions, the final rule Supplemental Nutrition Assistance Program (SNAP): Eligibility, Certification, and Employment and Training Provisions of the Food, Conservation and Energy Act of 2008, published January 6, 2017 (82 FR 2010), included an interim final rule with amendments to 7 CFR 273.11(e) and (f) to revise the procedures for when SNAP clients leave DAA treatment centers or GLAs. Specifically, the interim final rule mandated that DAA treatment centers and GLAs return EBT cards to residents with benefits pro-rated based on the date of their departure, submit complete change report forms to the State agency when a resident leaves, and notify the State agency within 5 days if unable to provide the resident with their EBT card at departure.

The initial comment period for this interim final rule was 60 days. Consistent with the memorandum of January 20, 2017, to the heads of executive departments and agencies from the Assistant to the President and Chief of Staff, entitled “Regulatory Freeze Pending Review”, the comment period for the interim final rule was extended from ending on March 7, 2017, to April 6, 2017. The effective date for the interim final rule was delayed to June 5, 2017.

Comments on the Interim Final Rule

FNS received five comments in response to the interim final rule. Four of the comments were from State agencies and one comment was outside the scope of the interim final rule. All four germane comments were adverse.

Commenters indicated significant logistical and operational difficulties to comply with the provisions as written and, as a result, the Department has concluded that more research and stakeholder outreach must be done in this area before requirements for these centers are finalized.

The interim final rule required that when a household leaves a GLA or DAA treatment center, the GLA or DAA treatment center must return a prorated amount of the departing household's monthly allotment back to the household's EBT account based on the number of days in the month that the household resided at the center. Three commenters noted that GLAs and DAA treatment centers are not required by regulations to be authorized as SNAP retailers or to have EBT point-of-sale (POS) devices that would facilitate such action. As such, they expressed concern as to how centers without EBT POS devices would be able to return benefits once SNAP clients were no longer residents. One of these commenters, a State agency, indicated that while it supported the return of pro-rated benefits to households, the State had no DAA treatment centers or GLAs authorized as retailers in the State and thus there would be no functional way to implement the rule as written. Another commenter noted that proration is not an automatic function for EBT systems and, therefore, proration would have to be manually completed by even those GLAs or DAA treatment centers with POS devices, which could potentially be error-prone.

The Department acknowledges that the interim final rule does not accurately reflect the operationalization of benefit redemptions in GLAs and DAA treatment centers that are not authorized retailers, and would cause undue hardship in requiring every GLA and DAA treatment center to become an authorized retailer. The Department acknowledges it was not its intent to require all GLAs and DAA treatment centers to become authorized SNAP retailers, but that the interim final rule as written would have required this of the centers in order for them to meet the requirements outlined in the rule in a practical manner. Due to the negative response, the Department is not finalizing the substantive amendments contained in the interim final rule.

Changes to § 273.11 in the Final Rule

This rule only finalizes the statutorily mandated nomenclature changes and procedures for § 273.11(e) and (f), as well as the paragraph removals, redesignations and technical revisions as outlined in the department's proposed rule issued on May 4, 2011. The Department received no comments that addressed these changes alone. The changes to procedures in § 273.11(e) and (f) are codifying existing policy. The Department is also making changes throughout § 273.11(e) to ensure consistent nomenclature in referring to DAA treatment centers, removing references to “DAA centers” or “DAAs” and replacing these with “DAA treatment centers”, and clarifying that “DAA treatment centers” refers to publicly operated or private non-profit drug addict or alcoholic treatment and rehabilitation programs. The proposed rule's paragraph removals, redesignations and revisions that were substantially unchanged and codified by the interim final rule are not amended further here.

Future Steps and Guidance on This Provision

The Department still intends to further assess the operations of GLAs and DAA treatment centers and remains interested in enhancing protections when clients leave a GLA or DAA treatment center. However, the Department intends to consult with State agencies and other stakeholders in order to determine the most appropriate changes for future rulemaking on this topic. The Department will conduct a holistic review of GLAs and DAA treatment centers that are authorized retailers as well as those that are not authorized retailers to better understand current operational procedures, and work with all stakeholders to determine what appropriate changes should be made in rulemaking based on existing processes and technology. The Department appreciates the concerns for client access and GLA and DAA treatment center responsibility raised by commenters in both the proposed and interim final rules, and will take them into consideration while conducting its review of GLA and DAA treatment center procedures. During this time, GLA and DAA treatment centers will continue to follow the procedures as outlined in this final rule and residents who depart these facilities will continue to receive some benefits depending on the time of month of their departure.

Procedural Matters

Executive Orders 12866 and 13563

Executive Orders 12866 and 13563 direct agencies to assess all costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, distributive impacts, and equity). Executive Order 13563 emphasizes the importance of quantifying both costs and benefits, reducing costs, harmonizing rules, and promoting flexibility. This final rule has been determined to be significant and was reviewed by the Office of Management and Budget in conformance with Executive Order 12866.

Executive Orders 13771

Executive Order 13771 directs agencies to reduce regulation and control regulatory costs and provides that the cost of planned regulations be prudently managed and controlled through a budgeting process. FNS considers this rule to be an Executive Order 13771 deregulatory action.

Regulatory Impact Analysis

A Regulatory Impact Analysis must be prepared for rules with economically significant effects ($100 million or more in any one year). USDA does not anticipate that this final rule is likely to have an economic impact of $100 million or more in any one year, and therefore, does not meet the definition of “economically significant” under Executive Order 12866. Provisions of this rule do not affect the level of benefits paid to SNAP participants who reside in these facilities. The Department estimates that removing the substantive provisions of the interim final rule will result in a savings of $2.6 million annually and $13 million over five years in administrative costs to federal and State governments and DAA treatment centers and GLAs operating as authorized SNAP retailers.

The interim final rule provisions would have inadvertently required additional DAA treatment centers and GLAs to become SNAP-authorized retailers. Under provisions of the Food and Nutrition Act, operators of GLAs and DAAs that would have become newly-authorized SNAP retailers under the interim final rule provisions would be eligible for free EBT-only point-of-sale (POS) devices. Estimated cost of providing equipment to newly authorized DAA treatment centers and GLAs is $540 per year per retailer; this cost would be split evenly between federal and State governments. The Department estimates that an additional 1,900 DAA treatment centers or GLAs would have become newly-authorized under the interim final rule provisions, so the total cost of providing this equipment to newly-authorized GLAs and DAAs would have been approximately $1 million per year.

In addition, DAA treatment centers and GLAs will no longer incur costs related to prorating benefits and submitting reports to State agencies when residents leave facilities. The Department estimates that removing this requirement will save GLAs and DAAs approximately $1.6 million annually. There currently are approximately 1,500 DAA treatment centers and GLAs that are authorized SNAP retailers. As noted above, the Department estimates that an additional 1,900 DAA treatment centers and GLAs would have become authorized retailers under the interim final rule provisions, for a total of about 3,400 (2,100 DAAs and 1,300 GLAs).

Based on annual redemptions of approximately $120 million, the Department estimates the average currently-authorized DAA serves about 38 SNAP participants per month and the average authorized GLA serves about 99 SNAP participants per month. Assuming the average length of stay for residential treatment facilities is 90 days and the average length of stay for GLAs is one year, each facility would have been required to prorate benefits and report to the State agency approximately 148 times per year (DAAs) or 99 times per year (GLAs) under the interim final rule provisions. The Department assumes each proration/report would take .25 hours at a mean wage of $14.65 for a health care support worker, or $3.66 per occurrence.

Regulatory Flexibility Act

The Regulatory Flexibility Act (5 U.S.C. 601-612) requires Agencies to analyze the impact of rulemaking on small entities and consider alternatives that would minimize any significant impacts on a substantial number of small entities. Pursuant to that review, the Administrator of the Food and Nutrition Service certifies that this final rule does not have a significant impact on a substantial number of small entities including DAA treatment centers and GLAs. State and local human service agencies will be the most affected to the extent that they administer SNAP. The provisions of this final rule are implemented through State agencies which are not small entities as defined by the Regulatory Flexibility Act.

Unfunded Mandates Reform Act

Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), Public Law 104-4, requires Federal agencies to assess the effects of their regulatory actions on State, local and tribal governments and the private sector. Under section 202 of the UMRA, the Department generally must prepare a written statement, including a cost benefit analysis, for proposed and final rules with “Federal mandates” that may result in expenditures by State, local or tribal governments, in the aggregate, or the private sector, of $100 million or more in any one year. When such a statement is needed for a rule, Section 205 of the UMRA generally requires the Department to identify and consider a reasonable number of regulatory alternatives and adopt the most cost effective or least burdensome alternative that achieves the objectives of the rule.

This final rule does not contain Federal mandates (under the regulatory provisions of Title II of the UMRA) for State, local and tribal governments or the private sector of $100 million or more in any one year. Thus, the rule is not subject to the requirements of sections 202 and 205 of the UMRA.

Executive Order 12372

SNAP is listed in the Catalog of Federal Domestic Assistance under No. 10.561. For the reasons set forth in the final rule, Department of Agriculture Programs and Activities Covered Under Executive Order 12372 (48 FR 29114), the Program is included in the scope of Executive Order 12372, which requires intergovernmental consultation with State and local officials.

Federalism Summary Impact Statement

Executive Order 13132 requires Federal agencies to consider the impact of their regulatory actions on State and local governments. Where such actions have federalism implications, agencies are directed to provide a statement for inclusion in the preamble to the regulations describing the agency's considerations in terms of the three categories called for under Section 6(b)(2)(B) of Executive Order 13132. The Department has considered the impact of this rule on State and local governments and has determined that this rule does not have federalism implications. Therefore, under section 6(b) of the Executive Order, a federalism summary is not required.

Executive Order 12988, Civil Justice Reform

This final rule has been reviewed under Executive Order 12988, Civil Justice Reform. This rule is not intended to have preemptive effect with respect to any State or local laws, regulations or policies which conflict with its provisions or which would otherwise impede its full and timely implementation. This rule is not intended to have retroactive effect unless so specified in the Effective Dates section of the final rule. Prior to any judicial challenge to the provisions of the final rule, all applicable administrative procedures must be exhausted.

Civil Rights Impact Analysis

FNS has reviewed this final rule in accordance with USDA Regulation 4300-4, “Civil Rights Impact Analysis,” to identify any major civil rights impacts the rule might have on program participants on the basis of age, race, color, national origin, sex or disability. After a careful review of the rule's intent and provisions, FNS has determined that this rule is not expected to affect the participation of protected individuals in SNAP.

Further, FNS specifically prohibits the State and local government agencies that administer the program from engaging in discriminatory actions. Discrimination in any aspect of program administration is prohibited by SNAP regulations, the Food and Nutrition Act of 2008, the Age Discrimination Act of 1975, Section 504 of the Rehabilitation Act of 1973, the Americans with Disabilities Act of 1990 and Title VI of the Civil Rights Act of 1964. State agencies must comply with these requirements and the regulations at 7 CFR 272.6.

Executive Order 13175

This rule has been reviewed in accordance with the requirements of Executive Order 13175, Consultation and Coordination with Indian Tribal Governments. Executive Order 13175 requires Federal agencies to consult and coordinate with tribes on a government-to-government basis on policies that have tribal implications, including regulations, legislative comments or proposed legislation, and other policy statements or actions that have substantial direct effects on one or more Indian tribes, on the relationship between the Federal Government and Indian tribes or on the distribution of power and responsibilities between the Federal Government and Indian tribes.

FNS has assessed the impact of this rule on Indian tribes and determined that this rule does not, to its knowledge, have tribal implications that require tribal consultation under Executive Order 13175. If a Tribe requests consultation, the FNS will work with the Office of Tribal Relations to ensure meaningful consultation is provided where changes, additions and modifications identified herein are not expressly mandated by Congress.

Currently, FNS provides regularly scheduled quarterly information sessions as a venue for collaborative conversations with Tribal officials or their designees. Reports from these information sessions are put on the USDA annual reporting on Tribal consultation and collaboration. FNS received no comments with Indian Tribes on either the proposed rule or the interim final rule that related to these provisions.

Paperwork Reduction Act

The Paperwork Reduction Act of 1995 (44 U.S.C. Chap. 35; 5 CFR 1320) requires the Office of Management and Budget (OMB) to approve all collections of information by a Federal agency before they can be implemented. Respondents are not required to respond to any collection of information unless it displays a current valid OMB control number.

This rule does not contain information collection requirements subject to approval by the Office of Management and Budget under the Paperwork Reduction Act of 1994.

E-Government Act Compliance

The Department is committed to complying with the E-Government Act of 2002, Public Law 107-347, to promote the use of the internet and other information technologies to provide increased opportunities for citizen access to Government information and services, and for other purposes.

List of Subjects in 7 CFR Part 273

• Administrative practice and procedure
• Food stamps
• Fraud
• Grant programs-social programs
• Income taxes
• Reporting and recordkeeping requirements

Accordingly, 7 CFR part 273 is amended as follows:

PART 273—CERTIFICATION OF ELIGIBLE HOUSEHOLDS

1. The authority citation for 7 CFR part 273 continues to read as follows:

Authority: 7 U.S.C. 2011-2036.

2. In § 273.11:

a. Revise paragraph (e)(1);

b. Amend paragraph (e)(2)(i) by removing the words “DAA center” and adding in their place the words “DAA treatment center”;

c. Amend paragraph (e)(2)(ii) by removing the words “DAA centers” and adding in their place the words “DAA treatment centers”;

d. Amend paragraph (e)(2)(iii) by removing the words “treatment center” and adding in their place the words “DAA treatment center”;

e. Amend paragraph (e)(3) by removing the words “DAA center” and adding in their place the words “DAA treatment center”;

f. Amend paragraph (e)(4) by removing the words “DAA centers” and adding in their place the words “DAA treatment centers”;

g. Revise paragraphs (e)(5) and (6);

h. Remove the last sentence of paragraph (f)(4);

i. Revise paragraph (f)(5);

j. Redesignate paragraphs (f)(6) and (7) as paragraphs (f)(7) and (8);

k. Add a new paragraph (f)(6);

l. Amend newly redesignated paragraph (f)(7) by removing the words “drug and alcoholic treatment centers in paragraphs (e)(7) and (e)(8)” and adding in their place the words “DAA treatment centers in paragraphs (e)(7) and (8)”; and

m. Revise the first sentence of newly redesignated paragraph (f)(8).

The revisions and additions read as follows: