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Payment Accuracy

Release No.

USDA Office of Communications (202) 720-4623

<p align="center" class="BodyTextBlack"><i>Improved Administration Results in $356 Million Reduction in Incorrect Payments</i></p>

WASHINGTON, June 16, 2011 – Agriculture Secretary Tom Vilsack today announced that the Department of Agriculture in cooperation with state partners has improved payment accuracy and program integrity in the nation's largest nutrition assistance program. Vilsack commended selected states for their excellence in administering the Supplemental Nutrition Assistance Program (SNAP) in Fiscal Year (FY) 2010. The national average level of program payment accuracy for FY 2010 is (96.19 percent), the fourth consecutive year the program has achieved a historically high rate. The accuracy rate for Fiscal Year 2010 is at an all time high and underscores the Administration's ongoing effort to make government more accountable to the American people.

"The Obama administration has made it clear that we will track down and eliminate misspent tax dollars in every agency and department across the federal government," said Vilsack. "USDA and our state agency partners have done just that in achieving historically high accuracy rates in SNAP and we will continue to make improvements that protect taxpayer dollars while putting healthy food on the table for struggling individuals and families."

Under the Food and Nutrition Act of 2008, each state agency is responsible for monitoring and improving its administration of SNAP. The SNAP Quality Control System determines the accuracy of the benefits authorized. The national payment error rate was 3.81 percent in FY 2010, a record low. Without this improvement, FY 2010 improper payments would have been $356 million higher.

Working in collaboration with USDA, state agencies continue to enhance SNAP program integrity even as demand has increased in response to national economic conditions. This year, USDA is investing in process improvement efforts that examine local office processes and identify and implement efficiencies. The department is also interested in funding projects that use technology to achieve procedural changes, such as document imaging, telephone interviews or web-based access to case status information. Today's announcement proves that states' efforts to ensure program integrity and improve their process for administering SNAP are working.

SNAP benefits are essential to the nutrition and well-being of one in seven people in our nation and also provide an economic stimulus that strengthens communities. Research shows that every $5 in new SNAP benefits generates as much as $9.00 in economic activity. SNAP benefits move quickly into local economies, with 97 percent of SNAP benefits redeemed within a month. It is estimated that at least 8,900 full-time equivalent jobs are created from $1 billion of SNAP benefits.

USDA provides monetary incentives to the seven states with the best payment accuracy rates and the three states with the most improved payment accuracy, while $6 million is awarded among the four states with the lowest negative error rates and the most improve negative error rates. For the second straight year, states overall have improved their negative error rates (a measure of denials, terminations, and suspensions). Two states, Texas and Illinois, are being recognized for both best payment accuracy rates and most improved accuracy rates.

The states below were recognized for their performance rates:

Best Payment Accuracy Rate (figures represent the error rate as a percentage)

Florida 0.78
South Dakota 1.31
Delaware 1.52
Illinois 1.70
Mississippi 1.92
Wisconsin 1.97
Georgia 1.99
Texas 2.13
Alaska 2.15

Most Improved Accuracy Rate (figures represent the improvement rate as a percentage)

Texas 4.77
Indiana 4.53
Illinois 4.47

Best Negative Error Rate

Nebraska 0.00
South Dakota 0.25
North Dakota 1.24
Oregon 2.12

Most Improved Negative Error Rate (figures represent the percentage point improvement)

District of Columbia 27.18
Michigan 20.55

USDA's Food and Nutrition Service oversees the administration of 15 nutrition assistance programs that touch the lives of one in four Americans over the course of a year. The largest program, SNAP, puts healthy food on the table for more than 44 million people each month, half of whom are children.

Release No.

Amanda Browne and Regan Hopper (703) 305-2281

As someone with decades of experience working in anti-poverty programs, I have witnessed firsthand the important role government can play in helping families living from paycheck to paycheck. I have seen how the Supplemental Nutrition Assistance Program (SNAP), formerly known as food stamps, helps millions of responsible, hardworking Americans put food on the table for their families.

SNAP helps support jobs and provides a boost to the economy. SNAP has a good story to tell when it comes to using taxpayer funds responsibly and wisely, one that does not get told enough. This is why it is so disappointing when sporadic abuses of the program by a few are used as a political football in the media. You would think that lottery winners and criminals are the only Americans receiving SNAP benefits. This couldn’t be further from the truth.

Abuses are the exception, not the norm. They overshadow record achievements in SNAP for payment accuracy and program integrity, and do a disservice to the overwhelming majority that truly need the program and are playing by the rules.

People should understand that the record 44 million Americans – more than half of whom are children, elderly and the disabled –participating in SNAP is due primarily to the fact that we are still recovering from the worst economic collapse since the Great Depression. We know it is right, and in the interest of all of us, to help them get back on their feet.

SNAP provides an economic stimulus that strengthens communities. Research shows that every $5 in new SNAP benefits generates as much as $9 in economic activity. Benefits move quickly into local economies, supporting and creating jobs for the Americans who grow, process, pack, ship, shelve and sell us food.

At the same time, rooting out waste, fraud and abuse is a top priority for this administration. We do not tolerate fraud in SNAP at USDA, and prosecute those who attempt to game the system.
USDA works in partnership with State agencies to ensure responsible steward of taxpayer resources.

Due to increased oversight and improvements to management, the prevalence of selling SNAP benefits for cash or “trafficking” – has fallen significantly over the last two decades to roughly 1 cent on the dollar. Additionally, payment accuracy in SNAP is at an all-time high – over the last decade participation among - payment errors have gone from 8.91% to 3.81%. Simply put, participation is up, and errors are down. While these are positive trends, any trafficking or error is too much. So USDA continues to aggressively improve integrity in SNAP. We use state-of-the-art technology to help target criminals. We receive ongoing risk assessments of all stores that accept SNAP benefits based to identify program violations.

Our fraud detection system has newer, more advanced data mining technology and analytical tools available in the private sector. These efforts make us even better at getting rid of those who break the law and abuse the program.

Beyond pursuing fraud, USDA is also deeply committed to ensuring benefits are targeted to those Americans who need them most. This is why we proactively urge states to use their current authority to change state policies so that millionaires – or those receiving substantial windfalls – do not receive SNAP benefits.

These are just a few of the things we are doing every day to perform the job America’s taxpayers have entrusted to us. And we are committed to doing even more. As our nation continues down its path of economic recovery we know our work is cut out for us. But our sense of dignity and morality tells us we must support hard-working Americans who are still struggling to meet their most basic nutritional needs. SNAP is an integral part of those efforts, which will stimulate the economy and help us grow a stronger nation for all Americans.