Study: Minority of SNAP recipients spend benefits early in the month

A well-known aspect of the monthly Supplemental Nutrition Assistance Program (SNAP) payments is some recipients may spend most of their benefits early in the month, possibly resulting in trouble obtaining food later.

“Most SNAP recipients get by with a combination of their own resources and SNAP,” said Jeffrey Dorfman, professor of agriculture and applied economics at the University of Georgia. “If you spend early, it doesn’t mean you don’t buy any more food, but it increases the possibility that by the end of the month, you will be short on funds and experience food insecurity.”

New research from Dorfman and his fellow authors suggests that contrary to earlier beliefs, a minority of SNAP recipients are responsible for this spending pattern. This group, on average, spends two-thirds of their monthly benefit within the first four days of the month. Researchers suggest that education programs and changing the benefits schedule could help.

In Georgia, 14 percent of households are food insecure or struggle to afford a nutritionally adequate diet, according to data from the Center on Budget and Policy Priorities. SNAP is the primary and largest food assistance program in the nation. In 2017, more than 1.6 million Georgia residents (16 percent) utilized $2.54 billion in SNAP benefits.

The research, recently published in Applied Economic Perspectives and Policy, used data from the U.S. Department of Agriculture’s National Household Food Acquisition and Purchase Survey from 2012 to 2013. Results revealed two distinct groups of SNAP benefit recipients with wildly different spending patterns, Dorfman said. The smaller group, “impatient” households (39 percent), spends four times as much of their monthly SNAP benefit in the first few days of the month compared to the “patient” group (61 percent). As the month continues, spending patterns of both groups are more similar.

Some variables explained the behaviors of impatient households: For example, households in the impatient group were more likely to spend their benefits quickly if they had a job, have money in the bank or own a home. They were more likely to spend their benefits more slowly if they have children at home or use a grocery list while shopping. But there were few statistically significant differences between patient and impatient households that could explain why their spending patterns are so different.

“We hoped we would be able to find something that said the ‘patient’ people do this and ‘impatient’ people do that, but we did not,” Dorfman said. “We looked at loads of different demographic characteristics and factors. I guess it comes down to personality.”

Dorfman and policy experts ruled out fraud, specifically the possibility that individuals in the impatient households belong to a group that sell their benefits at the beginning of the month to convert them into cash.

“We don’t have evidence that the benefit cycle is connected to any cases of fraud,” said Alex Camardelle, senior policy analyst for the Georgia Budget and Policy Institute.

Many households are connected to SNAP through local food banks and caseworkers at state agencies like the Division of Family and Children Services (DFCS), Camardelle said. “These organizations, both public and not-for-profit, play a huge role in advising and guiding SNAP participants on when and how to use their SNAP dollars so they can stretch them over the full month,” said Camardelle, noting the need for more of these resources.

In 2017, SNAP-Ed, the nutrition education arm of DFCS, operated at 820 locations in 77 of Georgia’s 159 counties through partnerships with four organizations. (This includes most of the metro Atlanta area.) That year, 137,336 participants, or about 8 percent of total SNAP recipients in the state, were reached. According to data from DFCS, program participants were 19 percent more likely to not run out of food before month’s end after the intervention.

Study researchers suggested that education programs that teach basic budgeting could help change spending patterns if they target impatient households. Researchers also recommend that policymakers consider providing SNAP benefits twice monthly instead of once per month.

“It wouldn’t cost the government any more money to fill the cards more often,” said Dorfman, referring to the Electronic Benefit Transfer cards that had replaced paper stamps or coupons in all states by 2004. Dorfman reasoned that a semimonthly benefit would more closely mirror the normal financial budgeting of SNAP recipients in working families.

But Camardelle said the reporting requirements for SNAP, which include assets, income, and job promotions, for example, could be difficult to meet if they are on a semimonthly or weekly schedule. More important than the frequency of the benefits, he said, is the amount. The federal government pays 100 percent of SNAP benefits, but state and federal governments share administrative costs.

Last year, the state began phasing in work requirements for able-bodied adults without children or dependents that will reach all Georgia counties by 2019. The requirements resulted in thousands of SNAP recipients losing benefits or being reclassified between January and April 2017.

In February, President Donald Trump revealed plans to reduce the benefits by more than $200 billion over 10 years. The proposal includes the "harvest box" promoted by U.S. Agriculture Secretary and former Georgia Gov. Sonny Perdue.The box of shelf-stable foods would replace half the money provided to SNAP households that receive at least $90 each month in benefits.

In Georgia, SNAP recipients receive on average, $1.40 per meal per person, Camardelle said. Research from the Center on Budget and Policy Priorities in 2016 found that raising the monthly SNAP benefit by $30 per person per month improves the likelihood of stretching groceries throughout the full month and purchasing more nutritious foods.

“Even if you change the frequency of benefits, I’m not sure that would help curb hunger as much as if we actually increase the benefit amount,” Camardelle said. “We think policymakers should be less concerned about when people spend their benefits and more concerned about how little they have to spend.”

MORE DETAILS

SNAP-Ed is the nutrition arm of the Food Stamp Program. SNAP Nutrition Education is currently provided by four agencies in Georgia. Clients can visit the following websites or call these phone numbers for additional information:

University of Georgia, 706-542-6117, FoodTalk.org

Georgia Department of Public Health, dph.georgia.gov/snap-ed

Open Hand Atlanta, ohcookingmatters.org/home.html

HealthMPowers, 770-817-1733, healthmpowers.org

This article was written by Nedra Rhone, The Atlanta Journal-Constitution.

Cox Media Group