fruit-basket-photoWhat’s known to social policy wonks as the Supplemental Nutrition Assistance Program — perhaps better known as the food stamp program —  has served as a national safety net for many years, providing assistance to low-income households that meet certain income and asset eligibility criteria to buy food.

These benefits are 100 percent federally funded and are one of the most effective economic stimulus measures available.

In fact, every five dollars of SNAP benefits spent generates nine dollars in economic activity. Those dollars spent at the grocery store, in turn, help to pay the salaries of the grocery clerks, truckers who haul the food and the farmers who grows the crops.

To be eligible for SNAP benefits in New Mexico, most households can have no more than $2,000 in countable assets, $3,000 for households with elderly or disabled members.

Countable assets can include things such as money in a savings account, severance packages, stocks and bonds, land and tools. These asset limits have remained unchanged for most households for over 20 years while prices have risen substantially.

The federal government has given states the flexibility to set their own asset test. This is the direction states are moving in nationally. Numerous states, including our neighbors Arizona and Texas have already increased or removed entirely the asset test.

But because New Mexico has not yet acted, a family in New Mexico with a laid off worker would have to deplete their savings before being able to access SNAP benefits while the same family in Arizona or Texas would not.

The Corporation for Enterprise Development has given New Mexico a D on financial prosperity based in part on extreme asset poverty. New Mexico ranks dead last nationally in asset poverty and change in asset poverty.

This means that New Mexico has the largest proportion of households without sufficient assets to subsist at the poverty level for three months in the face of a job loss or other absence of income. Policies such as the SNAP asset test make it difficult for New Mexicans to build assets. Moreover, the ability to retain and build assets is critical for economic self-sufficiency.

And a failure to maximize the SNAP program not only hurts families, it hurts our entire state economy.

A USDA study estimates that the number of eligible households would increase by about 22 percent if the asset test were eliminated. Therefore, removing the asset test has the potential to generate up to $100 million dollars of additional economic activity yearly in New Mexico.

Until New Mexico addresses the SNAP asset test, we will continue to leave federal money — and food — on the table.

 

Patricia Anders is a staff attorney with the New Mexico Center on Law and Poverty.