The good folks at Center for Enterprise Development emailed supporters today encouraging the asset development field to contact Congress regarding the onerous asset test for food stamp recipients. Here’s what they said (most of the text below is unapologetically taken directly from CFED’s email):
Congress is poised to reauthorize the Farm Bill which includes the Food Stamp Program. Tell Congress to Stop Discouraging Savings: Remove or Improve Food Stamps’ Asset Test. Add Your Organization to the Sign-on Letter by April 9, 2007!
Savings and asset advocates are sending a letter to the Agriculture Committee Chairmen on Monday, April 9, 2007. The letter requests that the Committees eliminate or improve asset limits for the Food Stamp program.
The Food Stamp Program is integral to ensuring that low-income people, seniors, and people with disabilities have the resources to sustain a healthy diet.
However, the asset rules for the Food Stamp program penalizes low-income families by requiring that they spend down their Individual Retirement Accounts and 529 college account savings to under $2,000 ($3,000 for households with an elderly or disabled family member) before they can receive assistance.
CFED and others seek to remove this strong “do not save message” by eliminating or lessening the impact of the asset limit in the Food Stamp Program. In this changing economy, low-income workers must receive incentives – not disincentives – to develop a “nest egg” for financial emergencies, save for college, and save for retirement.
Studies have shown that asset tests discourage low-income households from saving because families fear that savings might disqualify them if they need to rely on means-tested public assistance in the future. A policy that eliminated or raised the asset limits and exclude retirement and college savings accounts would benefit families and the nation. Research has shown that families with savings are better able to weather a financial crisis such as an eviction or job loss. With greater stability, families are less likely to rely on public assistance.
Add your organization’s name, city, and state to the letter, asking the Agriculture Committee to eliminate the asset test, or adjust the limit for inflation and exempt specific assets including tax-preferred retirement and education savings.
To join the letter, please send your organization’s name, city, and state to email@example.com or call (202) 202 207-0156.
CFED, working with the Center on Budget and Policy Priorities, will send the letter to the Senate and House Agriculture Committee Chairmen on Monday April 9, 2007.