Welfare card talks to be contentious

State Rep. Peter Leishman, D-Peterborough, is quite correct when he says welfare fraud is not a “partisan issue.”

We would like to think everyone – Democrats, Republicans and independents alike – would agree that the use of welfare money for non-essential purposes runs counter to the intent of the taxpayer-financed program.

That issue was brought front and center last month after Jackie Whiton, 65, of Antrim, was fired from her job at the Big Apple convenience store in Peterborough after refusing to sell cigarettes to a customer using an electronic benefit transfer card. These debit cards are issued to welfare recipients by the state Department of Health and Human Services under its Temporary Assistance for Needy Families program.

Currently, neither state nor federal laws restrict how the EBT cards can be used, which is what led to Whiton’s firing. But that’s going to change soon as a result of a federal policy change that was contained in this year’s passage of the Middle Class Tax Relief and Job Creation Act of 2012.

Starting in February 2014, states will be required to establish policies to prevent the use of EBT cards in casino/gaming establishments, liquor stores and adult entertainment businesses or face the loss of 5 percent in federal money.

So far, 10 states have passed their own laws and another dozen or so are considering doing so, according to the National Conference of State Legislatures.

The federal crackdown was prompted by a series of media reports that documented the questionable use of EBT cards for what most would agree fall far outside the realm of “necessities.”

A Los Angeles Times investigation in 2010, for example, revealed that $1.8 million in welfare funds were withdrawn from casinos and another $12,000 from strip clubs.

For New Hampshire, the challenge going forward is twofold: what purchases to ban and how to enforce compliance. And as contentious as the first step could be, the second might be more complex.

A report issued by the eGovernment Payments Council, based on a survey of public officials responsible for enforcing such restrictions, pointed out some of the difficulties. Among them:

Since the EBT restrictions only apply to the welfare program, what stops recipients of other forms of public assistance – i.e., food stamps, unemployment insurance, child support, etc. – from using those funds for restricted purchases?

How do states compel merchants – particularly those over which they have no or limited authority – to enforce the restrictions?

And if the solution requires changes in technology – such as reprogramming the EBT cards or the machines that accept them – who is going to pay for it?

These are some of the issues the next state Legislature will face as it moves forward to comply with changes in federal law. At that time, it may want to consider further limitations – such as cigarettes, tattoo/piercing shops, nightclubs and cruise vacations – as other states have done.

Furthermore, it should at least consider the ramifications of either banning or blocking the EBT cards from being used to withdraw cash at ATM machines.

The challenge, of course, is devising a way to stop the misuse by a minority of recipients without imposing hardships on the majority who use the benefits as originally intended.

Admittedly, that’s easier said than done.