[Federal Register Volume 85, Number 164 (Monday, August 24, 2020)]
[Rules and Regulations]
[Pages 52025-52033]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-16403]
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Rules and Regulations
Federal Register
________________________________________________________________________
This section of the FEDERAL REGISTER contains regulatory documents
having general applicability and legal effect, most of which are keyed
to and codified in the Code of Federal Regulations, which is published
under 50 titles pursuant to 44 U.S.C. 1510.
The Code of Federal Regulations is sold by the Superintendent of Documents.
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Federal Register / Vol. 85, No. 164 / Monday, August 24, 2020 / Rules
and Regulations
[[Page 52025]]
DEPARTMENT OF AGRICULTURE
Food and Nutrition Service
7 CFR Parts 271 and 274
[FNS-2016-0074]
RIN 0584-AE02
Supplemental Nutrition Assistance Program: 2008 Farm Bill
Provisions on Clarification of Split Issuance; Accrual of Benefits and
Definition Changes
AGENCY: Food and Nutrition Service, U.S. Department of Agriculture.
ACTION: Final rule.
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SUMMARY: This final rule amends the Supplemental Nutrition Assistance
Program (SNAP) regulations to implement provisions of the 2008 Farm
Bill regarding monthly benefit issuance allotments, storage of benefits
off-line, and permanent expungement of unused benefits, as well as
related benefit expungement and off-line storage provisions of the 2018
Farm Bill. This final rule also updates SNAP regulations to reflect the
program's name change to SNAP and benefit issuance through Electronic
Benefit Transfer (EBT) systems.
DATES: This final rule is effective September 23, 2020.
FOR FURTHER INFORMATION CONTACT: Vicky T. Robinson, Chief, Retailer
Management and Issuance Branch, Retailer Policy and Management
Division, Food and Nutrition Service (FNS), U.S. Department of
Agriculture (USDA), 1320 Braddock Place, Alexandria, Virginia 22314,
(703) 305-2476, [email protected].
SUPPLEMENTARY INFORMATION:
I. Executive Summary
Purpose of the Regulatory Action
This rule finalizes the provisions of a proposed rule published on
September 29, 2016 (81 FR 66866). With this final rule, the Department
is amending 7 CFR part 274 to implement the benefit issuance, storage
and expungement provisions of the Food, Conservation and Energy Act of
2008, Public Law 110-234 (2008 Farm Bill).
Since publication of the proposed rule, the President signed the
Agriculture Improvement Act of 2018 (2018 Farm Bill), which made
additional mandatory changes to the provisions governing the storage
and expungement of unused benefits. Accordingly, the Department intends
to adopt these 2018 Farm Bill provisions as final as well.
Finally, this final rule will update terminology at 7 CFR part 271
to reflect the program's new name and the issuance of benefits through
Electronic Benefit Transfer (EBT) systems, as well as add new EBT-
related definitions to 7 CFR 271.2.
Summary of Changes From Proposed Rule
The final rule incorporates the following modifications for
clarity:
The definitions of EBT Card, EBT System, Interoperability
and Point-of-Sale Device will no longer refer to point-of-sale and card
technology in order to take into account on-line and other emerging
technologies.
Amendatory language is being added to clarify that taking
benefits off-line means making a household's entire SNAP EBT account
inaccessible to the household, including any new benefits added to the
account.
Amendatory language is being added to clarify that any
unexpired benefits taken off-line must be restored upon a household's
recertification or reapplication for benefits or a general request for
assistance.
Amendatory language is being added to clarify that
benefits must be expunged on a first-in-first-out (FIFO) basis.
The Department is also making the following changes to the proposed
provisions:
The proposed change to the definition of ``Drug addiction
or alcoholic treatment and rehabilitation program,'' is being withdrawn
to provide the public another opportunity to comment as part of a
future comprehensive rulemaking regarding group living arrangements.
The proposed corrections to the definitions of
``Employment and Training (E&T) component,'' and ``Employment and
Training (E&T) mandatory participant.'' is being withdrawn because they
will be included in a separate rulemaking on E&T provisions.
State agencies will now have the option to maintain the
current method of expunging unused benefits only from inactive accounts
or to expunge benefits based on the date of issuance, regardless of
account activity. The option the State chooses must be applied to all
households.
State agencies must expunge unused benefits after nine
months (rather than 12 months) in accordance with one of the
expungement processes above.
States agencies must provide notice to individual
households prior to expunging benefits no later than 30 days prior to
the date the benefits will be expunged.
State agencies may choose to take benefits off-line prior
to expungement after three months of account inactivity (rather than
six months).
State agencies will not be required to remove off-line
benefits from the Account Management Agent (AMA) as proposed. Instead,
State agencies will be required to make the entire EBT account
inaccessible to the household if they take benefits off-line.
II. Background
SNAP regulations at 7 CFR part 274 already required several of the
2008 Farm bill provisions addressed in the proposed rule. These include
requirements to issue monthly benefits in one lump sum, expunge unused
benefits after the household's account has been inactive for 12 months,
and notify households prior to taking benefits off-line. The
Department's implementing memo on October 1, 2008, addressed provisions
requiring State agencies to wait until a SNAP account remains inactive
for six months and to reinstate off-line benefits within 48 hours of a
household's request.
The Department published a proposed rule to solicit comments on
various implementation details of the above provisions over which the
Department has discretion, as well as to update 7 CFR part 271 to
reflect ``SNAP'' as the new name of the program and the mandatory
issuance of benefits through Electronic Benefit Transfer (EBT) systems.
[[Page 52026]]
With regard to benefit expungement, the proposed rule specifically
solicited feedback on whether the expungement timeframe should continue
to apply only to inactive EBT accounts as required under current SNAP
policy, require State agencies to expunge benefits based on the date of
issuance even if the account remains active, or provide States agencies
the option to use either method.
On December 20, 2018, the President signed the 2018 Farm Bill,
which made additional changes to the provisions governing the storage
and expungement of unused benefits. Section 4006 of the 2018 Farm Bill
specifies that a State may take benefits off-line after three months
(previously six months) and that States must expunge unused benefits
after nine months (previously 12 months). States must also notify
individual households before expunging their benefits. Because these
provisions are mandatory and non-discretionary, the Department is
including these provisions in this final rule without comment. State
agencies will have 12 months from the effective date of this rule to
implement these mandatory 2018 Farm Bill provisions.
The Department solicited comments on the proposed rule for 60 days,
ending November 28, 2016. The Department received 24 comments from
various entities, including 13 advocate organizations, eight State or
local government agencies, two Electronic Funds Transfer (EFT)
associations, and one individual not identified with an organization or
a State agency.
III. Summary of Comments and Explanation of Revisions
Overall, commenters supported the proposed rule but wanted
exemptions from the expungement and off-line provisions for certain
groups, as well as greater protections for clients, especially the
elderly and disabled. Commenters also wanted more clarification on the
process for taking benefits off-line and restoring them. There was some
opposition to the requirement to remove off-line benefits or the
benefits of deceased households from the EBT system and the AMA,
preferring that State agencies merely deactivate EBT cards. Some
commenters also pointed out that some of the definitions related to EBT
were too narrow and should be broadened to account for emerging
technologies. Below is further discussion of the most substantive
comments the Department received.
Definitions
The Department proposed adding new definitions under 7 CFR part 271
to update terminology for the EBT issuance system and ensure
consistency with current policy. Commenters wanted the definitions of
EBT card, EBT system, Interoperability, and point-of-sale (POS)
terminal to account for possible technologies that do not require a POS
terminal or EBT card, such as online shopping. The Department agrees
that the proposed definitions may be too narrow as technology develops.
Therefore, this final rule broadens these definitions. One commenter
also noted that adding the definition for Contractor would be
confusing, given such broad and varying use of the term throughout the
SNAP program. This final rule will change the term Contractor to EBT
contractor to distinguish it from other types of contractors used in
SNAP. These changes are reflected at Sec. 271.2.
Split Issuance
Section 4113 of the 2008 Farm Bill required State agencies to issue
a household's ongoing monthly benefit allotment in one lump sum. The
Department clarified existing regulations in the proposed regulations
that affirm this requirement.
Thirteen advocate and two industry organizations expressed strong
support for prohibiting State agencies from splitting ongoing monthly
allotments. They believe that lump sum monthly allotments provide SNAP
households with maximum flexibility for managing how and when to
purchase food within the time, transportation and other constraints
that low-income shoppers often face. One commenter also commented that
splitting monthly SNAP allotments would have a ``chilling effect'' on
seniors receiving SNAP benefits. Others added that it would increase
administrative costs at both the state and federal level. No commenters
expressed opposition to this provision.
The Department appreciates all comments on this issue, which
provide additional support for requiring the issuance of monthly
benefit allotments in a single lump sum. Given these comments and the
fact that no comments expressed opposition, this provision remains
unchanged in the final rule at 7 CFR 274.2(c).
Moving Benefits Off-Line
Prior to the 2008 Farm Bill, regulations required three months of
account inactivity before the State agency could exercise its
discretion to move the inactive account benefits offline. However, the
2008 Farm Bill mandated six months of account inactivity before the
State agency could move the inactive account benefits offline.
Accordingly, the Department proposed rules to reflect this new
requirement. However, following publication of the proposed rule,
Congress passed the 2018 Farm Bill which restored the original
requirement of three months of inactivity. Because this statutory
provision is mandatory and non-discretionary, the Department will not
change the current regulation, which requires three months of
inactivity prior to moving benefits offline.
The Department also proposed to notify households in advance within
10 days prior to moving inactive account benefits off-line. In
addition, the Department proposed to require that any offline benefits
must be restored within 48 hours of the recipient's request. Finally,
the Department proposed to remove off-line benefits from the EBT system
rather than merely deactivating the account.
No comments opposed the requirement for the notice or the
restoration of benefits within 48 hours of a recipient's requests.
However, commenters did request exemptions for certain groups,
consideration of potential barriers to participation in SNAP before
moving inactive account benefits off-line, and clarification regarding
removal of off-line benefits from the EBT and AMA systems. The
Department summarizes these comments and provides its responses below.
Nine advocate organizations requested that the Department make
several household categories exempt from having their benefits taken
off-line, such as the elderly, disabled and/or households that receive
the minimum benefit allotment. The Department emphasizes that State
agencies are not required to take benefits off-line prior to permanent
expungement. Moreover, individual State agencies that choose to
implement the off-line option have the discretion to exempt certain
groups of households from having their inactive accounts stored off-
line. Therefore, the Department will not require certain household
exemptions in this final rule. Instead, any State agency that chooses
to implement the off-line option can exercise its own discretion as to
whether to apply such exemptions.
Six advocate organizations wanted the Department to require State
agencies to investigate possible barriers facing the household before
taking benefits off-line. Commenters suggested that State agencies
should consider specific demographics of the SNAP household, whether
the SNAP household received their EBT card and PIN, whether the SNAP
household is aware of
[[Page 52027]]
transportation community services, and whether a lack of information
exists regarding the appointment of an authorized representative.
Currently, only six State agencies exercise the off-line option,
without any such requirement in place. The Department does not have
supporting information from those States to justify requiring States to
now take affirmative steps prior to taking action to determine if
households are experiencing barriers that prevent them from using their
benefits. Furthermore, the action to take benefits off-line is not
permanent. Households still have up to six months to have the benefits
reinstated from the point that benefits are moved off-line. However,
the Department encourages State agencies that opt to take benefits off-
line to include, in addition to how to reactivate the account,
information in the off-line notice regarding transportation options,
authorized representatives, and other assistance available to
households.
Eight advocate organizations wanted the Department to codify
requirements for a simple and easy-to-use process for requesting
restoration of benefits stored off-line, including notices that are
easy to understand and an easy way to contact a SNAP worker to request
reinstatement. The Department is not swayed by the comments suggesting
simple and easy-to-use processes should be codified. However, in
response to comments, the Department is requiring that any unexpired
benefits taken off-line be restored upon recertification or
reapplication for benefits without the household having to make a
specific request and that, moreover, a general request for any type of
assistance from a household that has had benefits moved off-line be
considered a request for reinstatement of those benefits. States may
continue to establish their own procedures for restoring benefits
outside of the recertification or application process. Title 7 CFR
274.2(h) is amended accordingly.
Removing Off-Line Benefits From the EBT System
The Department proposed to require that, if a State exercised their
option to take inactive account benefits off-line, the amount would
also need to be removed from the AMA. The AMA is an accounting system
that interfaces with the U.S. Department of Treasury to keep track of
benefit authorizations, returned benefits such as expungements, and
benefit redemptions. An industry organization opposed this proposed
requirement because it would require all such benefits to be tracked by
the eligibility system and reissued if requested by the household.
Commenters added that this requirement would complicate AMA reporting
because the accounting method would understate the true outstanding
SNAP liability of SNAP benefits for States that move benefits off-line
prior to expungement. Commenters suggested allowing States to leave the
benefits on the EBT system and merely make them inaccessible to the
client. Another industry organization disagreed with the need to take
benefits off-line at all because of the overall complexity of tracking
and reporting the benefits.
The option for State agencies to take benefits off-line after three
months of account inactivity is statutory and, therefore, the
Department does not have the discretion to eliminate this option.
However, we are persuaded by the commenters that the complexities
associated with removing the benefits from AMA are unwarranted.
Therefore, in this final rule, the Department is removing the proposed
provision to require State agencies to remove off-line benefits from
AMA. State agencies may continue to move benefits off-line after at
least three months of inactivity by making inactive EBT account
benefits inaccessible to the household without taking them off the AMA
system. The Department will also clarify the meaning of taking benefits
off-line to align with this change. Title 7 CFR 274.2(h) is amended
accordingly.
Benefit Expungement
The Department proposed keeping the current expungement process,
which is based on account activity, unchanged. The Department also
specifically asked commenters to provide feedback on amending the
process so that unused benefits are expunged based on the issuance
date, regardless of account activity. This alternative process would
give households a finite period of time to use their benefits as
opposed to allowing benefits to remain in household EBT accounts
indefinitely, as long as there is account activity at least once every
12 months. The Department also asked for comments on whether State
agencies should have the option to choose either of the two methods for
determining when benefits get expunged.
Seventeen commenters in total, including all 13 advocate
organizations, three State/local agencies, and one EFT association,
preferred maintaining the current process of expunging only from
inactive accounts. They cited the technological and financial burden on
State agencies to make the necessary system changes as well as the view
that there are practical and economic reasons for households to
accumulate benefits which tend to impact the most vulnerable SNAP
recipients--the elderly, disabled, and those with transportation,
mobility and food access hurdles. Three advocate organizations wanted
the Department to require State agencies to expunge benefits on a
first-in-first-out (FIFO) basis under the alternative option to expunge
benefits based on the issuance date.
Four commenters, including two State agencies, preferred expunging
benefits that have not been used by a specific timeframe, regardless of
account activity. They believe this approach is more consistent with
the purpose of the Program and that excessively high SNAP EBT account
balances could indicate a lack of need or fraudulent activity, which
undermines the public's perception of the program's integrity. Three
other State agencies wanted to have the option to choose either
expungement method.
If the Department were to require States to change the current
expungement process to require unused benefits be expunged based on the
date of issuance, several commenters wanted the Department to exempt
restored benefits from the expungement process or allow households a
longer period of time to spend those benefits. Also, many of the same
commenters who wanted exemptions from taking benefits off-line for
certain households wanted similar exemptions to apply to benefit
expungement as well.
In the interest of State flexibility, the Department has decided to
give State agencies the option to implement either of the two
expungement methods described in the proposed rule. State agencies must
designate which approach will be used in its State plan and apply the
same approach uniformly to all households. The Department would also
like to take this opportunity to clarify that State agencies are
already required to apply household transactions against SNAP benefits
on a FIFO basis and that, under either of the two expungement options,
by definition, State agencies will continue to expunge the oldest
benefits first.
In accordance with Section 4006 of the 2018 Farm Bill, this final
rule amends the expungement timeframe from 12 months to nine months.
The Department considers nine months to be equal to 274 days.
Therefore, State agencies may opt to either expunge households'
individual benefit allotments, or any remaining portion thereof, nine
months after the allotment was issued (i.e., made available to the
household) or wait until the account has
[[Page 52028]]
been inactive for nine months before expunging any benefits at the
allotment level. In this final rule, the amended expungement provisions
are at 7 CFR 274.2(i) and the proposed paragraph (i) is now paragraph
(j).
If expunging benefits based on the issuance date, the Department
was interested in feedback with regard to lump sum benefits issued as a
result of a fair hearing determination to determine if an exception
process was feasible or practical. Since then, the Department has
determined that an exception process that allows households additional
time beyond nine months to access their benefits would not be
consistent with the 2018 Farm Bill requirement and, therefore, is not
allowable. However, State agencies that choose the option to expunge
benefits based on the issuance date could mitigate the potential
problem of lump sum issuances by splitting up the retroactive payments
and issuing them in separate months. The 2008 Farm Bill provision
specifically makes an exception to the split issuance prohibition in
cases where a benefit correction is necessary. No changes have been
made in the final rule regarding this issue.
Section 4006 of the 2018 Farm Bill also requires States to provide
notice to individual households prior to expunging that household's
SNAP benefits, including benefits stored off-line, so that the
household has the opportunity to access the benefits and avoid
expungement. Currently, State agencies are required to notify
individual households prior to taking benefits off-line, but not prior
to permanently expunging unused benefits.
Because the 2018 Farm Bill specifically requires the notice to
include the date upon which benefits must be expunged, the Department
is requiring State agencies to provide individual notification that is
closely tied to the expungement date, but not later than 30 days before
the first benefits get expunged. General notification of the change in
the expungement timeframes should be done at certification/
recertification and in training materials, as has been the case before
this requirement. This general notification, however, cannot replace
the individual notification to households whose benefits are scheduled
to be expunged within at least 30 days.
As proposed and as currently required, benefits must be expunged
individually at the monthly allotment level; however a notice is only
being required prior to expunging the first allotment. State agencies
are not being required to provide monthly expungement notices prior to
expunging each benefit allotment. If the expungement process stops for
a household for any reason, including when the household accesses their
benefits or requests restoration of remaining off-line benefits, the
State would need to provide the household with a new expungement notice
if the household's benefits become subject to expungement again.
Consistent with other required formal notices to households, the
Department is requiring that this notice must be written in easily
understandable language and include the date that benefit expungement
will begin, the action needed to prevent the expungement, and the
household's right to request a fair hearing. This expungement
notification provision is being codified at 7 CFR 274.2(i)(2).
Expunging Benefits of Deceased Households
In general, commenters did not oppose the proposed requirement to
expunge benefits when all certified household members are determined to
be deceased in accordance with 7 CFR 272.14, regardless of account
activity or the benefit issuance date. However, two State/local
agencies wanted the Department to allow State agencies to merely make
benefits of deceased households inaccessible until they age off, rather
than permanently expunging them at the time of the death match, to
avoid possible misidentification of deceased individuals. The same two
State agencies cited concerns with necessary system programming changes
and the need to make benefits quickly available again in instances when
the death match is erroneous.
While the Department understands concerns that a household account
might erroneously be expunged due to a false death match, several State
agencies have already been expunging benefits of deceased one-person
households under the Agency's waiver authority. Under 7 CFR 272.14,
State agencies are required to independently verify death matches and
provide the household notice and the opportunity to respond prior to
terminating benefits. To date, the Agency has not had any indication
that false death matches have created an issue that would justify
allowing benefits to remain in the EBT accounts of deceased single-
person households.
Furthermore, State agencies are already required to close single-
person household cases when a death match is verified. Therefore,
requiring States to expunge the account of such households does not add
any additional risks which do not already exist. Should such an error
occur, the State agency could correct the mistake by reissuing the
benefits as a new benefit just as when off-line benefits are reinstated
if they have been removed from the EBT system or when lump sum benefits
are restored as a result of a fair hearing determination.
In contrast, having benefits of a deceased household remain in the
account, even if deactivated, would leave such benefits susceptible to
fraud, such as being activated by unauthorized individuals. Since there
are no longer any certified individuals entitled to the benefits of
deceased households, these benefits cannot be reinstated. Leaving these
benefits in EBT accounts would also misrepresent the outstanding
liability to the Federal government. For all these reasons, the
Department is maintaining the provision to permanently expunge benefits
upon the verified death match of all certified members of the household
at 7 CFR 274.2(i)(4).
Implementation Deadline
The implementation deadline for all provisions in this rule is 12
months from the rule's effective date. With respect to the expungement
provisions, no later than 12 months from the effective date of this
rule, State agencies must issue individual notices to households who
will have benefits scheduled for expungement within at least 30 days,
based on the new nine-month expungement timeframe. Therefore, actual
benefit expungement under the new nine-month timeframe must begin no
later than 13 months from the effective date of this rule, after
providing the minimum 30-day notices to the affected individual
households.
Procedural Matters
Executive Order 12866 and Executive Order 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, of reducing costs, of harmonizing rules and of promoting
flexibility. This final rule has been determined to be not significant
and was not reviewed by the
[[Page 52029]]
Office of Management and Budget (OMB) in conformance with Executive
Order 12866.
Regulatory Impact Analysis
This final rule has been designated as not significant by the
Office of Management and Budget; therefore, no Regulatory Impact
Analysis is required.
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, this
final rule is certified not to have a significant impact on a
substantial number of small entities.
This final rule would not have an impact on small entities because
the provisions only impact State agencies responsible for administering
the Supplemental Nutrition Assistance Program.
Congressional Review Act
Pursuant to the Congressional Review Act (5 U.S.C. 801 et seq.),
the Office of Information and Regulatory Affairs designated this rule
as not a major rule as defined by 5 U.S.C. 804(2).
Executive Order 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.
This rule is not an E.O. 13771 regulatory action because it is not
significant under E.O. 12866.
Unfunded Mandates Reform Act
Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), Public
Law 104-4, establishes requirements for 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
The Supplemental Nutrition Assistance Program is listed in the
Catalog of Federal Domestic Assistance under Number 10.551 and is not
subject to 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 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
The Department 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.
Although the 2018 Farm Bill reduces the amount of time from 12
months to nine months, during which all households must use or access
their benefits before benefits are permanently expunged, mitigation
efforts are imbedded in the legislation and this rule by requiring that
each individual household be given notice prior to expungement. The
notice must be provided at least 30 days in advance, state the date
when expungement will begin, and specify the action the household must
take to prevent the expungement from occurring. There is no expungement
notice requirement under the current requirement to expunge benefits
after 12 months of SNAP account inactivity.
Without prior notification, the Department estimates that, on
average, approximately 16 percent of SNAP households currently get some
amount of benefits expunged from their SNAP accounts. The Department
estimates that, on average, one month's allotment is expunged for each
household affected. The Department anticipates that the new
notification requirement will reduce the number of expungements despite
the reduced timeframe for using benefits.
Currently, only six States are opting to take benefits off-line
prior to expungement after six months of account inactivity. The 2018
Farm bill now allows States to take benefits off-line after three
months of inactivity. In the States that take benefits off-line, the
Department estimates that 14 percent of households have their benefits
taken off-line and that six percent of those households have those
benefits reinstated prior to expungement. Providing individual
household notification prior to taking benefits off-line is required
under both the current regulation and the regulation being implemented
by this rule.
Because of the new requirement to notify households prior to
expungement, the Department estimates that a greater percentage of
households that get their benefits taken off-line will get their
benefits reinstated than under the new regulation, mitigating the
impact of the reduced timeframe for taking benefits off-line due to
account inactivity.
The Department is also codifying in this rule that States should
automatically restore any off-line benefits upon a household's
recertification or reapplication, and that a general request for
assistance should be considered a request for reinstatement of off-line
benefits.
While specific demographic data is not readily available, after a
careful review of the rule's intent and provisions and based on the
above analysis the Department has determined
[[Page 52030]]
that this final rule is not expected to affect the participation of
protected individuals in SNAP.
Executive Order 13175
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. We are unaware of any current
Tribal laws that could be in conflict with this rule.
Paperwork Reduction Act
The Paperwork Reduction Act of 1995 (44 U.S.C. chap. 35; see 5 CFR
part 1320) requires the Office of Management and Budget (OMB) 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.
In accordance with the Paperwork Reduction Act of 1995, this final
rule contains information collections that are subject to review and
approval by the Office of Management and Budget. These existing
requirements impact a current collection that has been used without a
valid OMB control number or expiration date. The Department plans to
bring these burden requirements into compliance, contingent upon OMB
approval under the Paperwork Reduction Act of 1995. FNS plans to
account for and maintain these burden hours under a new OMB control
number assigned by OMB. Because the changes in the information
collection burden that will result from adoption of provisions in this
final rule were not submitted for public comment in the proposed rule,
a separate 60-day notice was published on February 11, 2020, in the
Federal Register at 85 FR 7716.
All responses received to this published notice will be summarized
and included in the information collection request for OMB approval.
All comments are also a matter of public record. These changes are
contingent upon OMB approval under the Paperwork Reduction Act of 1995.
When the information collection requirements associated with this
rulemaking have been approved, the Department will publish a separate
notice in the Federal Register announcing OMB's approval.
Title: SNAP Benefit Storage and Expungement: Notices and Off-Line
Benefit Reinstatement.
OMB Number: 0584-NEW.
Expiration Date: N/A.
Type of Request: New.
Abstract: This is a new information collection request. Although
the agency has been collecting this information, we were unware that
collecting this information is in violation of the Paperwork Reduction
Act. This final rule implements benefit issuance provisions of the
Food, Conservation and Energy Act of 2008, Public Law 110-234 (2008
Farm Bill) and the Agricultural Improvement Act of 2018, Public Law
115-334, (2018 Farm Bill). Both Farm Bills amend the Food and Nutrition
Act of 2008 (the Act), which includes benefit issuance, storage and
expiration requirements for administering the program. State agencies
are responsible for issuing benefits to those households entitled to
benefits under the Act. This burden request covers activities
associated with the required notices sent to individuals/household SNAP
participants related to taking benefits off-line prior to permanent
expungement after three months of SNAP EBT account inactivity and
permanently expunging benefits after nine months of account inactivity.
In addition, this burden request covers the activities associated with
reinstating the off-line benefits to those SNAP participants upon
contact by the household.
Respondents: 53 State agencies and 2,961,834 individuals/households
SNAP participants. The respondents and activities are broken out below
based on activities.
Respondents: State/Local/Tribal Government Burden (53).
Off-Line Benefit Storage Notice
Estimated Number of Respondents: 6.
Estimated Number of Responses per Respondent: 90,136.33.
Estimated Total Annual Responses: 540,818.00.
Estimated Average Hours per Response Annually: 0.05 minutes or
0.0083 hours.
Estimated Total Annual Burden on Respondents: 4,515.83.
Expungement Notice
Estimated Number of Respondents: 53.
Estimated Number of Responses per Respondent: 55,883.66.
Estimated Total Annual Responses: 2,961,834.00.
Estimated Average Hours per Response Annually: 0.05 minutes or
0.0083 hours.
Estimated Total Annual Burden on Respondents: 24,731.31.
Off-Line Benefit Reinstatement
Estimated Number of Respondents: 6.
Estimated Number of Responses per Respondent: 5,543.33.
Estimated Total Annual Responses: 33,260.00.
Estimated Average Hours per Response Annually: 3 minutes or 0.0501
hours.
Estimated Total Annual Burden on Respondents: 1,666.33.
Respondents: Individual/Household Notice.
Off-Line Storage Notice
Estimated Number of Respondents: 540,818.00.
Estimated Number of Responses per Respondent: 1.
Estimated Total Annual Responses: 540,818.00.
Estimated Average Hours per Response Annually: 3.5 minutes or
0.0583 hours.
Estimated Total Annual Burden on Respondents: 31,529.69.
Expungement Notice
Estimated Number of Respondents: 2,961,834.
Estimated Number of Responses per Respondent: 1.
Estimated Total Annual Responses: 2,961,834.00.
Estimated Average Hours per Response Annually: 2 minutes or 0.0334
hours.
Estimated Total Annual Burden on Respondents: 98,925.26.
Off-line Benefit Reinstatement
Estimated Number of Respondents: 33,260.
Estimated Number of Responses per Respondent: 1.
Estimated Total Annual Responses: 33,260.00.
Estimated Average Hours per Response Annually: 5 minutes or 0.0835
hours.
Estimated Total Annual Burden on Respondents: 2,777.21.
The total burden for this rulemaking is 5,923,668.00 total annual
responses and 163,970.49 burden hours.
[[Page 52031]]
--------------------------------------------------------------------------------------------------------------------------------------------------------
Estimated
Responses avg. number Total
Estimated annually Total annual of hours Estimated Hourly wage annualized
Respondent Activity annual number per responses per annual total rate cost of
respondent respondent response hours respondent
annually burden
--------------------------------------------------------------------------------------------------------------------------------------------------------
Individuals or Households SNAP Benefit 2,961,834.00 1.00 2,961,834.00 0.0334 98,925.26 $7.25 $717,208.14
Recipients. Expungement
Notice.
Off-Line Benefit 540,818.00 1.00 540,818.00 0.0583 31,529.69 7.25 228,590.25
Storage Notice.
Off-Line Benefit 33,260.00 1.00 33,260.00 0.0835 2,777.21 7.25 20,134.77
Reinstatement.
--------------------------------------------------------------------------------------------------------------------------------------------------------
Sub-Total of Individual/ ................. 2,961,834.00 1.00 2,961,834.00 0.1752 133,232.16 7.25 965,933.16
Households SNAP
Recipients.
--------------------------------------------------------------------------------------------------------------------------------------------------------
State Agencies................ Benefit 53.00 55,883.66 2,961,834.00 0.0083 24,583.22 23.50 577,705.67
Expungement
Notice.
--------------------------------------------------------------------------------------------------------------------------------------------------------
Off-Line Benefit 6.00 90,136.33 540,818.00 0.0083 4,488.79 23.50 105,486.57
Storage Notice.
Off-Line Benefit 6.00 5,543.33 33,260.00 0.0501 1,666.33 23.50 39,158.76
Reinstatement.
--------------------------------------------------------------------------------------------------------------------------------------------------------
Sub-Total of State ................. 53.00 55,883.66 2,961,834.00 0.0677 30,738.34 23.50 722,351.00
Agencies.
--------------------------------------------------------------------------------------------------------------------------------------------------------
Grand Total Reporting ................. 2,961,887.00 2.0000 5,923,668.00 0.0277 163,970.49 ........... 1,688,284.16
Burden with both
Affect Public.
--------------------------------------------------------------------------------------------------------------------------------------------------------
Note: * Each State Eligibility worker is counted once as all State Agency employees.
** Based on the Bureau of Labor Statistics May 2020 Occupational and Wage Statistics (http://www.bls.gov/oes/current/)--the salaries of the case
managers are considered to be ``Social Workers--other'' (21-1029) functions valued at $30.12 per staff hour. The salaries of the eligibility workers
are considered to be ``Eligibility Interviewers, government programs'' (43-4061) functions valued at $22.34. The salaries of Office and Administrative
Support Workers, All other (43-9199) is $18.02 per hour. Assuming an applicant staff person with an average salary of $23.50 is needed to complete the
applications, the total annualized dollars spent on respondent burden with fully loaded wages is $2,245,417.93. The base cost to respondents is
$1,688,284.16 (x 1.33 fringe benefit cost) as depicted in the table above.
*** The $7.25 used to calculate a cost to SNAP applicants (individuals/households) is the Federal minimum wage.
E-Government Act Compliance
The Food and Nutrition Service is committed to complying with the
E-Government Act, 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 Parts 271 and 274
Food stamps, Grant programs-social programs, Reporting and
recordkeeping requirements.
For reason set forth in the preamble, 7 CFR chapter II is amended
as follows:
SUBCHAPTER C--[AMENDED]
0
1. Under the authority of 7 U.S.C 2011, in the heading of subchapter C
of chapter II, remove the words ``Food Stamp'' and add in their place
the words ``Supplemental Nutrition Assistance''.
0
2. The authority citation for 7 CFR parts 271 and 274 continues to read
as follows:
Authority: 7 U.S.C. 2011-2036.
PART 271--GENERAL INFORMATION AND DEFINITIONS
Sec. 271.1 [Amended]
0
3. In Sec. 271.1:
0
a. Remove the word ``coupons'' from the fourth sentence of paragraph
(b) and add in its place ``SNAP benefits''; and
0
b. Remove the word ``coupon'' from the tenth sentence of paragraph (b)
and add in its place ``benefit''.
0
4. In Sec. 271.2:
0
a. Amend the definition of Allotment by removing the word ``coupons''
and adding in its place the word ``benefits'';
0
b. Remove the definition of Authorization to participate card (ATP);
0
c. Add definitions for Benefit and Benefit issuer in alphabetical
order;
0
d. Remove the definitions of Bulk storage point, Coupon issuer, and
Direct access system;
0
e. Add definitions for Electronic Benefit Transfer (EBT) account,
Electronic Benefit Transfer (EBT) card, Electronic Benefit Transfer
(EBT) contractor or vendor, and Electronic Benefit Transfer (EBT)
system in alphabetical order;
0
f. Amend the definition of Eligible foods by removing the word
``coupons'' where it appears twice in paragraph (3) of the definition
and adding in its place the words ``SNAP benefits'';
0
g. Amend the definition of Firm's practice by removing the words ``food
coupons'' and adding in their place the words ``SNAP benefits'';
0
h. Add definitions for Interoperability, Manual transaction, and Manual
voucher in alphabetical order;
0
i. Amend the definition of Overissuance by removing the word
``coupons'' and adding in its place the word ``benefits'';
0
j. Add definitions for Personal identification number (PIN), Point-of-
sale (POS) terminal, and Primary account number (PAN) in alphabetical
order;
0
k. Remove the definition of Program; and
0
l. Add definitions for Retailer EBT Data Exchange (REDE) system and
Supplemental Nutrition Assistance Program (SNAP or Program) in
alphabetical order.
The additions read as follows:
Sec. 271.2 Definitions.
* * * * *
Benefit means the value of supplemental nutrition assistance
provided to a household by means of an EBT system or other means of
providing assistance, as determined by the Secretary.
Benefit issuer means any office of the State agency or any person,
partnership,
[[Page 52032]]
corporation, organization, political subdivision or other entity with
which a State agency has contracted for, or to which it has delegated
functional responsibility, in connection with the issuance of benefits
to households.
* * * * *
Electronic Benefit Transfer (EBT) account means a set of records
containing demographic, card, benefit, transaction and balance data for
an individual household within the EBT system that is maintained and
managed by a State or its contractor as part of the client case record.
Electronic Benefit Transfer (EBT) card means a method to access EBT
benefits issued to a household member or authorized representative
through the EBT system by a benefit issuer. This method may include an
on-line magnetic stripe card, an off-line smart card, a chip card, a
contactless digital wallet with a stored card, or any other similar
benefit access technology approved by FNS.
Electronic Benefit Transfer (EBT) contractor or vendor means an
entity that is selected to perform EBT-related services for the State
agency.
Electronic Benefit Transfer (EBT) system means an electronic
payments system under which household benefits are issued from and
stored in a central databank, maintained and managed by a State or its
contractor, and uses electronic funds transfer technology for the
delivery and control of food and other public assistance benefits.
* * * * *
Interoperability means a system that enables program benefits
issued to be redeemed outside the State that issued the benefits.
* * * * *
Manual transaction means an EBT transaction that is processed with
the use of a paper manual voucher when there is an EBT system outage.
Manual voucher means a paper document signed by the EBT cardholder
that allows a retailer to redeem benefits through a manual transaction.
* * * * *
Personal identification number (PIN) means a numeric code selected
by or assigned to a household and used to verify the identity of an EBT
cardholder when performing an EBT transaction.
* * * * *
Point-of-Sale (POS) terminal means a range of devices deployed at
authorized retail food stores for redeeming benefits by initiating
electronic debits and credits of household EBT accounts and retailer
bank accounts.
Primary account number (PAN) means a number embossed or printed on
the EBT card and encoded onto the card to identify the State and EBT
account holder.
* * * * *
Retailer EBT Data Exchange (REDE) system means the FNS system that
allows the automated exchange of authorized retailer demographic data
between FNS and the State and/or EBT contractor for notification of
changes in retailer Program participation.
* * * * *
Supplemental Nutrition Assistance Program (SNAP or Program) means
the program operated pursuant to the Food and Nutrition Act of 2008.
* * * * *
Sec. 271.4 [Amended]
0
5. In Sec. 271.4(a)(2), remove the word ``coupons'' and add in its
place ``SNAP benefits and EBT cards''.
Sec. 271.5 [Amended]
0
6. In Sec. 271.5:
0
a. Remove ``Coupons'', ``Coupon'', ``coupon'', and ``coupons'' wherever
they appear and add in their place ``Benefits'', ``Benefit'',
``benefit'', and ``benefits'', respectively;
0
b. Amend paragraph (a) by adding ``and EBT cards'' at the end of the
last sentence;
0
c. Amend the introductory text of paragraph (b) by removing ``ATP'' and
adding in its place ``EBT'';
0
d. Remove paragraphs (b)(1) through (3);
0
e. Amend paragraph (c) by removing ``ATP's'' wherever it appear and
adding in its place ``EBT cards''.
PART 274--ISSUANCE AND USE OF BENEFITS
0
7. In Sec. 274.2:
0
a. Revise paragraph (c);
0
b. Amend paragraph (e)(1) by removing ``of paragraphs (e) through (h)''
and removing ``Sec. 274.6 and Sec. 274.7'' and adding in its place
``Sec. Sec. 274.6 and 274.7'';
0
c. Amend paragraph (g)(3) by removing ``paragraph (h)(3)'' and adding
in its place ``paragraph (j)'';
0
d. Revise paragraph (h);
0
e. Add paragraphs (i) and (j).
The revisions and additions read as follows:
Sec. 274.2 Providing benefits to participants.
* * * * *
(c) Benefit allotments. (1) State agencies shall not issue ongoing
monthly benefit allotments to a household in more than one issuance
during a month except with respect to the issuance of benefits to a
resident of a drug and alcohol treatment and rehabilitation program in
accordance with Sec. 273.11(e) of this chapter or when a benefit
correction is necessary.
(2) For those households which are to receive a combined allotment,
the State agency shall provide the benefits for both months as an
aggregate (combined) allotment, or as two separate allotments, made
available at the same time in accordance with the timeframes specified
in Sec. 273.2 of this chapter.
* * * * *
(h) Off-line storage. If a household's EBT account is inactive for
three months (91 days) or longer, State agencies may elect to store all
benefits in that account off-line.
(1) An EBT account is inactive if the household has not initiated
activity that affects the balance of the household's SNAP EBT account,
such as a purchase or return.
(2) Taking benefits off-line means that the household's SNAP EBT
account, including all existing benefits in the account and any new
issuances deposited into the account, is no longer accessible to the
household unless and until the account and its benefits are reinstated
upon contact by the household.
(3) The State agency shall send written notification to the
household up to 10 days prior to or concurrent with the action to store
benefits off-line. If an inactive account has a zero balance, a notice
to the household is not required. At a minimum, the notice shall
include information on:
(i) The steps necessary to bring the benefits back on-line; and
(ii) The State agency's permanent expungement policy.
(4) Benefits stored off-line that have not been expunged in
accordance with paragraph (i) of this section shall be reinstated and
made available within 48 hours of reapplication or contact by the
household. In addition to a specific request for benefit restoration,
household contact shall include, but is not limited to:
(i) Recertification or reapplication for benefits; and
(ii) A general request for assistance.
(i) Expungement. (1) State agencies shall apply SNAP transactions
against a household's SNAP benefits on a first-in-first-out basis. As a
result, the oldest SNAP benefits are used first. On a daily basis, the
State agency shall expunge benefits from EBT accounts at the monthly
benefit allotment level in accordance with either paragraph (i)(1)(i)
or (ii) of this section. State agencies must designate which approach
will be used in its State plan and use the same approach for all
households within the State.
[[Page 52033]]
(i) Inactive EBT accounts. Benefits allotments, or portion thereof,
shall be expunged from EBT accounts that have been inactive, per
paragraph (h)(1) of this section, for a period of nine months (274
days) in accordance with the following:
(A) When the oldest benefit allotment has not been accessed by the
household for nine months, the State agency shall expunge benefits from
the EBT account or off-line storage at the monthly benefit allotment
level as each benefit allotment ages to nine months since the date of
issuance or since the last date of account activity, whichever date is
later.
(B) The State agency shall not expunge any benefits from active
accounts even if there are benefit allotments older than nine months.
If at any time after the expungement process begins, the household
initiates activity affecting the balance of the account, the State
shall stop expunging benefits from the account and start the account
aging process over again for the remaining benefits.
(ii) Unused benefits. The State agency shall expunge individual
benefit allotments, or portion thereof, that remain in a household's
EBT account nine months (274 days) after the date the allotment was
issued to the household, regardless of any account activity that may
have taken place.
(2) Not later than 30 days before benefit expungement is scheduled
to begin, State agencies shall provide notice to the household that
benefits in their EBT account are approaching expungement due to
nonuse/inactivity. At a minimum, the notice shall include:
(i) The date upon which benefits are scheduled to be expunged; and
(ii) The steps necessary to prevent the expungement, including an
opportunity to request that any benefits stored off-line be restored to
the household in accordance with paragraph (h) of this section;
(3) Expunged benefits shall be removed from the Account Management
Agent and shall not be reinstated.
(4) Notwithstanding paragraph (i)(1) of this section, in instances
when the State agency verifies a death match for all certified members
of the household and closes the SNAP case in accordance with Sec.
272.14 of this chapter, the State agency shall expunge the remaining
SNAP balance in the household's EBT account at that time. In accordance
with Sec. 273.13(b)(2) of this chapter, expungement notices, per
paragraph (i)(2) of this section, are not required for these
households.
(j) Procedures to adjust SNAP accounts. Procedures shall be
established to permit the appropriate managers to adjust SNAP benefits
that have already been posted to an EBT account prior to the household
accessing the account, or to remove benefits from inactive accounts for
off-line storage or expungement in accordance with paragraphs (h) and
(i) of this section.
(1) Whenever benefits are stored off-line or expunged, the State
agency shall document the date, amount of the benefits, and storage
location in the household case file.
(2) Issuance reports shall reflect the adjustment to the State
agency issuance totals to comply with monthly issuance reporting
requirements prescribed under Sec. 274.4.
Sec. 274.8 [Amended]
0
8. In Sec. 274.8(f)(8), remove ``Sec. 274.2(h)(2)'' and add in its
place ``Sec. 274.2(i)''.
Pamilyn Miller,
Administrator, Food and Nutrition Service.
[FR Doc. 2020-16403 Filed 8-21-20; 8:45 am]
BILLING CODE 3410-30-P