The LIHEAP Loophole or Heat and Eat
|I wouldn't have believed this story if I didn't research it myself.
SNAP benefits paid to recipients in 16 states and the District of Columbia are targeted by new budget cutting legislation proposed in Congress by a bipartisan conference made up of members from the House and Senate.
Certain SNAP recipients in the following states would be affected if the legislation passes.
District of Columbia
Information about the measure can be found at the House website linked.
Bill #: H.R. 2642
Name of Bill: Federal Agriculture Reform and Risk Management Act of 2013
The Statement of Managers
explains how the joint conference split the difference between the prior House and Senate versions of the bill that were competing for passage.
JOINT EXPLANATORY STATEMENT OF THE COMMITTEE OF CONFERENCE
(6) Standard Utility allowances based on the receipt of energy assistance payments
The House bill provides that only Low Income Home Energy Assistance Program (LIHEAP) payments above $20 would trigger a standard utility allowance (“SUA”) deduction.
The Senate amendment provides that only LIHEAP payments above $10 would trigger a SUA deduction. The Conference substitute adopts the House provision.
There’s a clear explanation about the link between LIHEAP and SNAP at the Center on Budget and Policy Priorities website.
To calculate eligibility for benefits, SNAP allows deductions from gross income for certain essential household expenses like utilities. In some areas of the country, heating a home during the winter can be costly. To streamline the approval process, some states use a household’s receipt of assistance under the Low Income Home Energy Assistance Program (LIHEAP) to show that a SNAP applicant incurs these costs and thus qualifies for the standard utility allowance deduction.
|“A few states began to provide a nominal LIHEAP benefit (just 10 cents a year in one state, and $1 a year in some others) to SNAP households that don’t otherwise receive a LIHEAP benefit, including many households that do not incur heating or cooling costs. These states did so to simplify verification requirements for the shelter deduction and to qualify more households for the SUA, enabling a considerable number of households that don’t incur heating or cooling costs to gain credit, in the SNAP benefit calculation, for utility costs they don’t actually pay and consequently to receive larger SNAP benefits. Sixteen states and Washington, D.C. have adopted this procedure.”
A detailed description of the practice appeared in the Congressional Research Service Report: The Next Farm Bill: Changing the Treatment of LIHEAP Receipt in the Calculation of SNAP Benefits (CRS Report R42591).
|Both the Senate Committee on Agriculture, Nutrition, and Forestry and the House Agriculture Committee have reported bills (S. 954 and H.R. 1947, respectively) that would limit the deduction associated with LIHEAP, particularly seeking to end a practice that has been referred to as “Heat and Eat.” Similar proposals were considered in the 112th Congress but were not enacted.
The report also includes the list of states that had passed “heat and eat" legislation as of last May when it was published. (on p.7)
The new legislation would require applicants to provide additional proof of their utilities cost if their LIHEAP documentation shows a yearly benefit of less than $20. The federal government expects 850,000 current SNAP recipients to be affected by a reduction in benefits or disqualification. The program expects to save $8 billion over a 10 year period. Currently there are about 17 million SNAP beneficiaries in the affected states where the cost of the program was approximately $28 billion in 2013.
||2013 Cost of SNAP
||# of Participants
|District of Columbia