A law enacted last year aimed at helping individuals transition out of public assistance programs remains in limbo, with Missouri’s social services agency saying it can’t implement the change without a huge infusion of state funding. 

The impasse is, in many ways, unsurprising. The legislation, which was approved with bipartisan support, came with a fiscal note that estimated it would cost the state over $100 million because the tweaks to the benefits programs wouldn’t be covered by the federal government.

“We continue to have conversations with our federal partners and the General Assembly to enable implementation of this legislation in the event that funding is appropriated and approved,” said Baylee Watts, a spokesperson for the Missouri Department of Social Services.

The law’s proponents, however, have questioned the accuracy of the fiscal note and say the state isn’t doing enough to implement the law, which was overwhelmingly approved by the legislature. 

“I don’t think that the program would cost what they’re saying,” said state Sen. Mary Elizabeth Coleman, a Republican from Arnold who co-sponsored the legislation, in an interview with The Independent.

The strategy the legislation uses is different from a federal policy for the food stamp program enacted in 41 states, called broad-based categorical eligibility. Advocates are urging Missouri to adopt that policy in lieu of the transitional benefits law passed last year, arguing it aligns with the intent of the legislation but wouldn’t require the state to bear the majority of the costs or require additional legislation.

“If there’s broad consensus that that’s the way that we should go, I would be open to having that conversation,” Coleman said, but later added that she could not support any policy “outside the scope of conservative welfare reform that was put forward and adopted by the legislature.”

‘Reforming our welfare system’

The bill passed last year and signed by Gov. Mike Parson created a transitional state benefits program for the Supplemental Nutrition Assistance Program, previously known as food stamps, and Temporary Aid for Needy Families, which provides limited cash assistance. It also expanded existing transitional benefits for the child care subsidy program. 

SNAP is the largest program the law addresses. Over 653,000 individuals in Missouri received SNAP benefits in December. There were just under 13,000 people receiving TANF direct assistance that month and 20,900 receiving the child care subsidy in November.

SNAP benefits are already federally designed to gradually decrease as income rises. The law, if implemented, would create a separate state program with a higher income maximum and its own benefit level calculations. The bill was designed to help mitigate the issue of participants being forced to choose between a small income bump and losing benefits.

Current Missouri law allows people to receive SNAP while earning a gross income of up to 130% of the federal poverty line. For a family of three, that is a maximum of $33,566 per year. The new law would transfer those with a gross income of between 130% and 200% of the federal poverty line to the transitional state program, with its own framework for how benefit amounts would be determined.

“Transitional benefits should be designed as a hand up, not a hand out trapping people in dependence,” Coleman said after the law passed last year. “This is a great first step in reforming our welfare system.”

The fiscal note attached to the legislation included the personnel and technology costs of creating it, along with the cost of paying for the benefits themselves, which the federal government wouldn’t cover. 

The estimated cost of the change annually was estimated to be at least $140 million, in the fiscal note published in June.

State Rep. Alex Riley, a Republican of Springfield, said in an interview with The Independent that he’d need to speak to the social services department before he could offer any comment about the delayed implementation. But he noted that he and others have long doubted the accuracy of the fiscal note.  

“We were frustrated,” he said, “because we didn’t think that they took into account that there will be people going off of public assistance because of implementing this and because of the structure that we created with this bill.”

At a budget hearing for the Department of Social Services in December, lawmakers expressed surprise at the price tag.

Just to implement the system changes for the programs would cost $39.8 million, Patrick Luebbering, the agency’s chief financial officer, told the House Subcommittee on Appropriations for Health, Mental Health and Social Services. That’s because, he said, “we’ll have to build brand new systems.” 

“Not only will we not get federal funding,” he said, “the way it was laid out, we can’t even use our existing systems — they’re requiring us to build new systems.” 

The agency’s budget request for the next fiscal year, which begins July 1, didn’t include the benefits themselves. Luebbering said that’s because it would take a year to build the system, so expenses for actual benefits wouldn’t be spent until the following budget year.

A route to ‘accomplish the intent’ for SNAP

Most states have taken another path to help SNAP participants take higher-paying work while avoiding a steep drop-off in benefits.

Under an existing federal policy option, states can increase the gross income limit from 130% of the federal poverty line up to 200%. States can also lift the restrictions on assets.

Missouri is one of nine states that has not opted in to this policy, called broad-based categorical eligibility, which allows states to pursue either or both strategies.

 Twenty-three states and D.C. set the gross income limit to 200%, with the remaining to somewhere between 130% and 200%. 

Two hundred percent of the federal poverty line is equivalent to an income limit of $51,640 for a family of three. 

The federal government pays the full cost of the additional benefits — the policy modifies a state’s existing SNAP program rather than requiring a state to set up its own, self-funded benefits program with its own rules. 

Thirty-seven states, plus Washington, D.C., have abandoned the SNAP asset tests through the categorical eligibility policy — to encourage saving and reduce the complexity of the application for individuals and state agencies processing them.

Missouri currently limits SNAP to those with assets of under $2,750 for most people, or $4,250 if at least one member of the household is over 60 or disabled. 

Christine Woody, food security policy manager for the nonprofit Empower Missouri, said she has been working with the department and urging them to adopt broad-based categorical eligibility for SNAP as a way to carry out a goal of the bill without it costing the state money it doesn’t have. 

The social services agency can apply on its own — it doesn’t need a legislative mandate.

Robert Knodell, director of the Missouri Department of Social Services, said at the December budget hearing that the department would pursue an application for that policy to avoid the full costs of implementing the program as a state-funded one.

“That would allow us to basically accomplish the intent of the transitional benefit,” Knodell said. “…We could use federal dollars for the program. And I do believe it would somewhat reduce systems and staffing needs around this program.”

According to records obtained by The Independent through Missouri’s Sunshine Law, the department in December submitted an application that relied on the language of the transitional benefits law instead of the standard language other states have used to raise the cutoff for SNAP eligibility.

In January, the federal government rejected the state’s application but expressed readiness to keep providing guidance to help “streamline the administration of SNAP and help ensure all eligible households in Missouri receive the SNAP benefits to which they are otherwise entitled.” 

Watts, a department spokesperson said it is “important to note [the federal government] considers broad-based categorical eligibility to be a different program than the transitional benefits outlined in [the legislation] passed last year.”

In an email to the department in December obtained by The Independent, Coleman expressed concern about whether the state’s application would be accepted. She attached a copy of the application to her email. 

“Our office has had discussion with DSS regarding a waiver, which we are supportive of, but had not seen a copy of the application,” she wrote. “The attached document doesn’t seem to match what we had discussed. I’m cc’ing DSS on this email.  Hopefully they can provide clarification of the source and intent of the language used in the application.”

She said in an interview last week that she never received a response to that email or to a follow-up.

Watts told the Independent Friday that “since last September, DSS has had monthly teleconferences with Senator Coleman about the legislation, including one this week, and we are willing to do the same with other members of the General Assembly in the event that they reach out with questions.”

The Department of Social Services has not clarified whether it plans to submit another version of the application to pursue broad-based categorical eligibility, but Woody said she’s “cautiously optimistic” it will. 

The story was updated at 9:33 A.M. on Feb. 5 to reflect the 2024 poverty levels.