The USDA is proposing a new rule that would affect the way Supplemental Nutrition Assistance Program (SNAP) benefits are calculated. If enacted, nearly one in three Michigan SNAP households could lose SNAP benefits.

The rule, SNAP: Standardization of State Heating and Cooling Standard Utility Allowances has been issued by the Food and Nutrition Service as a way to address benefit inequities between states and improve program integrity.

Under current law, SNAP takes into account the utility expenses of each SNAP household. States adjust household benefits based on a state-specific Standard Utility Allowance (SUA) calculated by the state and approved by USDA. The current policy allows variances in SUAs to accommodate for differences in utility costs and rates and allows states flexibility in how they calculate those costs.

The proposed rule would standardize and cap SUA calculations across the country based on survey data.

The impact of this change nationally:

• An estimated 19 percent of SNAP households would receive lower SNAP monthly benefits.

• Approximately 16 percent of households would see an increase in their monthly SNAP allotment.

• Around 8,000 current SNAP households would lose eligibility for SNAP benefits.

• The total reduction in Federal spending associated with the proposed rule to be approximately $4.5 billion over five years (2021-2025).

• In total, 29 states are expected to see a net loss of SNAP benefits (about $1.54 billion annually) and 22 are expected to see a net gain (about $540 million annually).

The impact of this rule in our state:

• About 31% of SNAP households would receive lower SNAP monthly benefits. Forecasts indicate this would disproportionately impact seniors and people with disabilities.

• Only 1% would see an increase in their monthly SNAP allotment.

• The overall amount of SNAP benefits in MI would be cut by 5%.

SNAP plays a critical role in addressing hunger and food insecurity in our state. It is the first line of defense against hunger for low-income residents. The proposed rule could exacerbate the struggles many low-income people have paying for the costs of both food and utilities and have harmful impacts on health and well-being, as well as on the economy.

According to the Food Research and Action Center:

• Around 97% of SNAP benefits are redeemed by the end of the month of issuance.

• $1 of SNAP benefits leads to between $1.50 and $1.80 in total economic activity during a recession.

• SNAP reaches key vulnerable populations: nearly 80% of SNAP households include a child, an older adult or a person with disabilities. Around 85% of all SNAP benefits go to such households.

• Research has found that receipt of SNAP in early childhood improved high school graduation rates, adult earnings and adult health.

• SNAP lifted 3.2 million Americans out of poverty in 2016, according to the Census Bureau’s Supplemental Poverty Measure.

• SNAP relieves pressure on overwhelmed food banks, pantries, religious congregations and other emergency food providers across the country.

SNAP is one of the three safety net programs being discussed at CMF’s upcoming convening, “Poverty and Social Policy: Rethinking Michigan’s Safety Net” slated for November 18. This event, taking place at the Lansing Community College West Campus, will examine Michigan’s safety net approach, focusing on Temporary Assistance for Needy Families (TANF), Childcare and Development Fund (CCDF) and SNAP. The convening is designed to level-up participants in their understanding of these three programs and provide inspiration from state and national examples on effective uses of the programs to support economic mobility. Online event registration is open now.

In related news, on October 17 Governor Gretchen Whitmer and Michigan Department of Health and Human Services Director Robert Gordon announced in a press release that changes to asset limits used to determine eligibility for public assistance in the form of food assistance, cash assistance and State Emergency Relief, effective November 1. The changes are expected to increase access to these benefits for more Michiganders.

And, in another change effective Nov. 1, MDHHS will accept a client statement of assets rather than requiring applicants to complete an assets verification checklist. Among states that still have asset tests for SNAP, most states allow individuals to self-attest, a shift that is aimed at reducing barriers for those in need.

Want more?

The deadline for public comments related to SNAP Standardization of State Heating and Cooling Standard Utility Allowances is December 2.

Register for CMF’s upcoming convening Poverty and Social Policy: Rethinking Michigan’s Safety Net slated for November 18.

Read the rule SNAP Standardization of State Heating and Cooling Standard Utility Allowances.

Read the Food Research and Action Center’s Regulatory Impact Analysis.

Learn more about the policy changes coming to public assistance and asset tests via MDHHS.