Stimulus act bolsters nation's food assistance programs

by Jay Sjerven
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WASHINGTON — The American Recovery and Reinvestment Act of 2009, passed by Congress and signed into law by President Barack Obama last month, made major additional funding available to the nation’s key food assistance programs. Additionally, businesses investing in new plants or equipment may benefit from an extension of a pre-stimulus measure relating to "bonus depreciation" of new plants built and equipment purchased in 2009.

The stimulus act strengthened the Supplemental Nutrition Assistance Program, formerly the food stamp program, by increasing monthly benefits for participants by 13.6% beginning April 1, 2009. The additional funding for SNAP was estimated at about $19.9 billion.

Under pre-stimulus law, SNAP monthly benefits for each fiscal year were set to take effect on Oct. 1 based on the value of the Thrifty Food Plan (T.F.P.) during the preceding June. The T.F.P. is a market basket of foods that if prepared and consumed in the home would provide a complete and nutritious diet at minimal cost.

The fiscal year 2009 maximum SNAP benefit for a reference family of four (an adult male, an adult female, one child between 6 and 8 years old and one child between 9 and 11 years old) was set at $588 per month, based on the cost of the T.F.P. for such a family in June 2008. The stimulus act beginning in April raises the SNAP benefits for the reference family of four by $80 a month, to $668.

The Food and Nutrition Service of the U.S. Department of Agriculture in advising its regional directors explained, "These adjustments are an entitlement that go into effect April 1, 2009, and will remain effective until the June T.F.P. (under law prior to the stimulus legislation) exceeds the levels prescribed in the stimulus legislation and results in higher maximum benefit levels."

Essentially, only when a future June T.F.P. for a reference family of four exceeds the $688 set by Congress in the stimulus act will the U.S.D.A. revert to the pre-stimulus formula for determining maximum SNAP benefits.

The act also lifts restrictions on the amount of time individuals may receive SNAP benefits through fiscal year 2010. Thereafter, in determining futures benefits beginning with fiscal year 2011, states shall disregard any period during which an individual received SNAP benefits prior to Oct. 1, 2010.

The Women, Infants and Children program (W.I.C.) will receive $500 million in additional funding for fiscal 2009, with $400 million to support an anticipated increase in caseloads and $100 million for management information systems. W.I.C. participants (there were about 8.7 million beneficiaries in 2008) receive checks or vouchers to purchase specific healthful foods to supplement their diets. Nearly three-quarters of individuals receiving W.I.C. benefits are children or infants from low-income families with the remainder being pregnant or postpartum women who meet the eligibility requirements. It was expected W.I.C. participation may increase to 9.1 million individuals in 2009.

The increase in funding for W.I.C. has particular import for the baking industry, said Nicholas A. Pyle of the Independent Bakers Association. Mr. Pyle said effective Oct. 1, 2009, the new W.I.C. food package for most program participants will include whole grain bread.

The stimulus act authorizes $100 million in grants awarded on a competitive basis to enable schools to upgrade or purchase new food service equipment. Priority will be given to requests from schools in which not less than 50% of students are eligible for free or reduced-price meals under the Richard B. Russell National School Lunch Act.

"The grant program will help schools add or upgrade their beverage coolers, allowing improved access and increased demand for milk in schools," said Ruth Saunders, senior director of policy and legislative affairs, International Dairy Foods Association. "We’re especially pleased that schools will have access to grant money, and we encourage members to alert their local school districts to this opportunity." The I.D.F.A. hoped schools installing new or additional milk coolers might arrest the decline in in-school fluid milk consumption.

Senior nutrition programs will receive $100 million in additional funding for formula grants to states for nutrition services to the elderly, including meals on wheels and congregate meals.

The act makes available an additional $150 million to purchase commodities to be distributed to those in need through the nation’s network of food banks.

In a provision related to business facility construction, upgrade or expansion, the stimulus act extended for a year a measure passed by Congress last year that allows a business to more quickly recover the cost of new capital expenditures. That measure departed from the normal depreciation schedule and allowed businesses to immediately write off 50% of the cost of the depreciable expenses for new plants and equipment.

This article can also be found in the digital edition of Food Business News, March 3, 2009, starting on Page 22. Click here to search that archive.

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