The Fiscal Responsibility Act of 2023 (FRA), signed into law by President Biden on June 3, 2023 includes changes to two social services programs administered by county governments in North Carolina – the Supplemental Nutrition Assistance Program (SNAP) and Temporary Assistance for Needy Families (TANF) program.  The information in this post may be helpful to local practitioners who work with these programs directly, serve the affected populations in other ways, or who wish to better understand how the changes may affect their communities more broadly.

What local social services programs are directly addressed in the FRA? 

The FRA includes changes to two widely used, federally-funded, state-supervised, locally-administered programs: the Supplemental Nutrition Assistance Program (SNAP) and Temporary Assistance for Needy Families (TANF) program.  In North Carolina, these programs are administered directly by county departments of social services, but all levels and types of government and community services may be indirectly impacted by the changes.

What is SNAP? 

SNAP is a long-standing federal program providing food assistance to low-income individuals and households. In North Carolina, this program is referred to as Food and Nutrition Services (FNS), though it was historically known as the “food stamp” program. To receive FNS benefits, some groups of eligible individuals are required to work or engage in job training (though many FNS participants are exempt from work requirements due to age, disability, certain caretaking responsibilities, and other permitted exemptions).

Before the FRA, to receive SNAP benefits for more than 3 months within a 36-month period, able-bodied adults without dependents (ABAWDs) ages 18-49 were required to work or attend a training program for at least 80 hours a month.[1] In addition, prior to the FRA, states could use a limited number of monthly exemptions for people who otherwise would be subject to the requirement and could carry over any unused discretionary exemptions indefinitely.

How is the FRA changing SNAP?

The FRA is directly changing the law governing SNAP in three ways. For one group, work requirements are increasing.  For another group, the work requirements are eliminated.  And there are some changes to state processes related to SNAP.  The changes will directly impact current and future SNAP recipients.

First, the FRA is expanding certain work requirements to apply to able-bodied adults without dependents who are ages 18 to 54 instead of 18 to 49.  The FRA expands this age range in three phases.

• Effective September 1, 2023, the full age range will be expanded to 18-50.
• Effective just one month later, October 1, 2023, the full age range will be expanded to 18-52.
• Finally, effective October 1, 2024, the full age range will be expanded to 18-54.

Second, the FRA is explicitly exempting certain other SNAP beneficiaries from work requirements: (1) people experiencing homelessness, (2) veterans, and (3) people ages 18 to 24 who were in foster care when they turned 18.  Prior to the FRA, these people were required to work or be in a training program as described above.  Beginning September 1, 2023, any income-eligible individual in one of these categories who submits a new SNAP application or comes up for recertification will be exempt from work requirements.

Third, the FRA makes some changes to state-level discretionary exemptions from SNAP work requirements.  Those changes are discussed in more detail below.

It is important to note that while the FRA changes involving SNAP are focused on work requirements, the majority of SNAP/FNS participants are exempt from work requirements due to age or because they meet other federal exemptions from work requirements (e.g., being a parent/caretaker for a dependent child under age 6).

Are the changes to SNAP work requirements permanent?

No.  The new age ranges and exemptions are set to end on October 1, 2030.

Are current SNAP (FNS) recipients affected by these changes, or is it only for new, future beneficiaries?

The changes apply to both current and future beneficiaries as described above.

What will the impact be to North Carolina local governments in terms of funding and administration for SNAP(FNS)?

It depends.  The federal government pays the full cost of SNAP(FNS) benefits. The federal government also pays half of the administrative costs for operating the program.  In North Carolina, counties pay the other half of those administrative costs.

The change in funding for each county will depend on the mix of SNAP beneficiaries who now must meet work requirements or who are newly exempt from work requirements.   For example, because veterans are now exempt, areas with a high number of veterans may see a significant increase in SNAP applications from this population because work requirements would no longer be a barrier to receiving these benefits.  If these individuals could not receive SNAP benefits previously because they were unable to meet the work requirements, but now they apply and qualify for benefits, county spending for SNAP administration will increase.  In other words, there may be a net increase in people applying, qualifying, and being served by the program, and therefore more administrative costs.  The increase in SNAP participants would also mean that more SNAP benefit dollars would flow into the local economy.

On the other hand, rural areas with a higher number of older adults between the age of 50 and 54 may see fewer individuals eligible for SNAP benefits, and as a result, less SNAP benefit dollars flowing into the local economy.  This population of current beneficiaries will be required to adhere to work or training requirements to continue receiving SNAP benefits. If they cannot do so, they will no longer qualify for benefits.  In addition, these individuals will not be able to receive SNAP benefits for a three-year period because of the ABAWD time limit. In this case, fewer people will be served, and county SNAP administration spending will decrease.  Regardless of the longer-term spending increase or reduction to maintain the SNAP program, there is likely to be some increase in county department work involved with the initial processing of the various individual changes.

It is important to note the characteristics of the groups who gain eligibility or lose eligibility are different.  For example, some older individuals (ages 50-54) may be burdened by their new requirements or lose benefits, while some younger individuals (former foster youth) may gain new resources that improve their situation.  Local governments should be aware that the gains and losses from this change may spill over to impact other local government and non-profit support services.  For example, if an older person loses SNAP benefits, they may turn to a local food assistance program for help.

These local differences will be reflected across states.  Some states will see more people newly eligible for benefits, and some will see less.  According to the U.S. Congressional Budget Office, the changes are expected to result in a net national increase in people eligible for SNAP benefits.

How will these changes impact local government administration of SNAP?

This is not clear yet.  One possible concern is the administrative burden of identifying and shifting the affected populations into or out of the work requirement status.  This includes communication to and education of those administering the program at the county level, current beneficiaries, and potential applicants.  A second concern will be the availability of work or training options for those who will now need them to qualify for benefits.  There may be greater availability of those options in some areas due to the individuals who currently are using these programs to meet SNAP eligibility standards no longer needing to participate (veterans, former foster youth, and individuals experiencing homelessness).   Because the two groups are very different, however, it is not clear that a job training program currently serving one population (e.g. veterans) would be appropriate for all individuals in the 50 to 54 category that are now subject to work requirements.  Each county will have to examine the options for the affected groups in their own county.

Are there any changes in SNAP at the state level?

Yes.  As described above, states currently can use a limited number of monthly exemptions for people who otherwise would be subject to the work requirement and carry over any unused discretionary exemptions indefinitely.   However, going forward, the FRA will permanently reduce the number of monthly discretionary exemptions states can use and prevent states from carrying over unused exemptions for more than one year.

What if there are not sufficient jobs in an area?

Currently, states can request that the United States Department of Agriculture (USDA) waive the SNAP work requirement for people who live in an area that lacks sufficient jobs or has a high unemployment rate.  The FRA does not change this state option.  States can still request a waiver of the work requirement for people who live in an area without sufficient jobs or with high unemployment. However, per state statute (G.S. 108A-51.1), the NC Department of Health and Human Services is prohibited from applying for any waivers from USDA to waive the ABAWD time limits.

What is TANF?

The Temporary Assistance for Needy Families (TANF) program is a federal program designed to help low-income families with children achieve economic self-sufficiency. In North Carolina, this program is known as Work First. States use TANF to fund monthly cash assistance payments to low-income families with children, as well as a wide range of services.  Funding is provided to the state in the form of a federal block grant.  Like SNAP, TANF funding is tied to state-level measures of recipients’ participation in work-related activities.

How is the FRA changing TANF?

The FRA makes some changes to how the participation rate in work-related activities is calculated at the state level.   These changes do not appear to have a direct impact on local governments, although it is possible there could be some data reporting changes as the state complies with its new FRA reporting requirements.

What will the impact be to North Carolina local governments in terms of funding and administration for TANF? 

It is unclear.  As mentioned above, the TANF changes do not appear to have a major direct impact on local administration of the Work First program other than possibly some data reporting changes.  It is possible that with the changes in how participation rates are calculated there will be funding changes in the amount North Carolina receives in its federal block grant, and thus some of those changes could flow to the local level.  However, the overall impact in federal funding for TANF is expected to be modest.  The Congressional Budget Office estimates the resulting reduction in block grants would reduce direct spending nationally by only $5 million over the 10-year period of 2023–2033.

[1] During the federal public health emergency, the SNAP three-month limit for able bodied adults without dependents (ABAWDs) was suspended nationwide, except in limited circumstances.  With the end of the public health emergency in May 2023, the clock on the time-limit for ABAWDs will restart effective July 1, 2023.