Missouri House Votes to Up Penalties within Poverty Program

Mar 16, 2018

Credit File Photo / KBIA News

The Missouri House passed a measure Thursday that would toughen rules for people who misspent benefit money within a poverty program.

The bill, passed by a 100-46 vote, affects the federal Temporary Assistance for Needy Families program, which provides regular cash payments to more than 11,000 families. The bill now heads to the Senate.

Spending benefit money on a prohibited item or business would result in a three-month ban the first time, a six-month ban the second and a loss of benefits for five years for a third infraction, under the legislation.

Currently, if people spend benefit money on tobacco, alcohol or other prohibited items, or at businesses such as liquor stores or strip clubs, they must pay that money back but may remain in the program. Businesses can also be fined for improperly accepting that money.

"We're looking at an effort to give folks an opportunity to correct a series of bad habits," said Republican Rep. Hannah Kelly of Mountain Grove. Kelly amended the bill to include the increased penalties.

"The overall purpose is to make sure we have the funds we need for those in dire need," she said.

The legislation also would bar recipients from using electronic benefit cards to withdraw money from ATMs.

The same benefit cards that contain TANF money also can contain funds from the Supplemental Nutrition Assistance Program, also known as food stamps, which provides food aid for low-income families. Like TANF, the SNAP program already bars expenditures on prohibited items or places.

Although the ban on ATM withdrawals would apply to both programs, the three-strike policy would only affect TANF.

States can set certain limitations within federally-allowed parameters.

In a statement, the progressive advocacy organization Empower Missouri questioned the legality of the bill and cited instructions from the U.S. Department of Health and Human Services regarding TANF that say: "States should maximize the flexibility for recipients to access cash withdrawals."

The bill's sponsor, Republican Rep. J. Eggleston of Maysville, acknowledged during a debate that barring ATM withdrawals might require a waiver from the federal government. The bill includes a provision that Missouri will ask for a waiver if the state decides it is necessary.

There were almost 600,000 such benefit cards in Missouri as of December. Legislative researchers estimated that enacting these changes would cost more than $1 million, although that amount would mostly be covered with federal funds.

During a House debate, opponents expressed concern that the proposal could hurt vulnerable families.

"Penalize people enough and they will just magically become not dependent?" asked Rep. Courtney Allen Curtis, D-Ferguson.

Some lawmakers said people could face stiff penalties for unwittingly violating a rule, such as by buying food at a liquor store if there wasn't a nearby grocery store. Another expressed concern that banning ATM withdrawals would prevent people from using benefit money at cash-only business, like laundromats.

The Department of Social Services did not respond to a request for comment regarding how often benefit money is misused.