As Farm Bill Moves Forward, Indiana Mulls Asset Limit Reform

This week, following months of negotiations, Congress is moving towards finalizing a Farm Bill, which will establish funding levels and eligibility criteria for the Supplemental Nutrition Assistance Program (SNAP/Food Stamps). Though it staves off the $40 billion in SNAP cuts proposed by the House,  the final bill will still be a blow to low-income families, cutting over $8 billion from the program—on top of the $5 billion slashed just last November, which has already left food banks incapable of coping with a surge in demand.

Despite the cuts, the Farm Bill should preserve a key policy that was on the chopping block—so-called “broad-based categorical eligibility” (BBCE), which gives states the option of raising or eliminating their SNAP asset limits, and modestly increasing the gross income limit. This policy has the greatest benefits for working families with children, which makes it particularly important as new data show that working households comprise a growing proportion of the SNAP caseload. Low wages and rising expenses mean these families cannot get by on a paycheck alone, even working full-time – making SNAP a crucial work support. 

Citing its benefits for both low-income families and program administration, most states have already implemented BBCE – but there are a few hold-outs. Indiana has the lowest asset limits in the nation. Families accessing TANF can have no more than $1000 in the bank, while those participating in SNAP are restricted to $2000 (the lowest limit permitted by federal law). According to the Indiana Institute for Working Families, average monthly expenses for a Hoosier family of three are $3511—meaning asset limits restrict them to enough savings to get by for only a couple of weeks, tops. As we detailed in an op-ed last summer, Indiana stands in stark contrast to its neighbor Illinois, where asset limits for both programs have been eliminated. For families on the brink, the state line itself is a serious barrier to economic resiliency and long-term stability.

Change might be on the way, thanks to a new bill, S.B. 413, introduced in the state legislature earlier this month.  S.B. 413 would take a major step forward by eliminating Indiana’s asset limits for both SNAP and TANF. Research shows that even modest savings strongly correlate with economic mobility; according to the Pew Charitable Trusts, “Someone with $10,000 in liquid savings…is 6.5 times more likely to have moved up and 5.5 times more likely to have made it to at least the middle compared with someone with only $1,000 in liquid savings.” Eliminating asset limits in Indiana would enable families to protect against emergencies and plan for the future, rather than signaling that “saving is a behavior that warrants punishment.” 

Unfortunately, advocates think it’s unlikely that the bill will succeed, and an astute editorial derided the state legislature for moving forward with a costly, stigmatizing, and likely unconstitutional bill to drug test TANF recipients, while leaving in place real barriers to upward mobility. Nevertheless, progress takes time, and as the Farm Bill leaves BBCE still on the table, asset limit reform remains possible.

In recent weeks, many advocates have expressed dismay and anger that the conversation about SNAP has been forced to focus so much on limiting cuts rather than strengthening the program—particularly as unemployment remains high and SNAP has proven to be a highly successful anti-poverty strategy. And they’re right: $8 billion less food on the table is hardly a victory against hunger and insecurity. Still, there are silver linings—the states just have to act on them.