WASHINGTON -- Keeping in line with his proposed $191 billion in cuts to the federal food-stamp program over the next decade, President Trump is also looking to charge retailers a fee for accepting food stamps.
Expected to hurt independent, small groceries more than their larger chain counterparts, the fee could generate upwards of $2.4 billion in new revenue.
The Office of Management and Budget (OMB) said the fee would be assessed when stores sign up for the Supplemental Nutrition Assistance Program (SNAP), according to a report on CNBC.com, and would require renewal after five years. The amount of the fee itself would depend on the size and type of retailer.
“Although a small number of stores may choose to leave the program rather than pay the fee, we do not expect that this will affect access to authorized stores," an official with the OMB told CNBC.
Grocery retailers are fighting back, calling the proposed policy “flawed.”
“As this process goes forward we look forward to working with the Administration, the Budget Committee and the House and Senate Agriculture Committees to address concerns to the food retail industry, including the flawed policy of imposing fees on food retailers in order to reduce the cost of the federal government’s nutrition assistance benefits to the most needy in our society," said Leslie G. Sarasin, president of the Food Marketing Institute (FMI), Arlington, Va., which represents the grocery industry.
NACS took a similar stance, stating: “It is critical that Congress and the Trump Administration understand the important role convenience stores have regarding the Supplemental Nutrition Assistance Program (SNAP). Convenience stores represent 45% of all retail outlets authorized to accept SNAP benefits—they are intensely local businesses that serve as a gathering place and source of community pride and offer an ever-growing range of products and services.”
In addition to the new fee, the Trump administration is proposing $191 billion in cuts over the next decade to SNAP. The reductions would come from tightening the work requirement to qualify for the benefits, but the details would be up to individual states, according to CNBC. The administration also expects states to make up some of the lost funding, the report states.
The administration's proposals are already receiving criticism on Capitol Hill, even among Republicans. Rep. Michael Conaway of Texas and Sen. Pat Roberts of Kansas, the chairmen of the House and Senate agriculture committees, have indicated they would fight the measure.
"We need to take a look at our nutrition assistance programs to ensure that they are helping the most vulnerable in our society," they said in a statement.
Food stamps accounted for about 5.8% of the estimated $669 billion in annual sales at grocery stores, according to FMI. But for some retailers, it accounts for a much larger share of revenue.
Members help make our journalism possible. Become a CSP member today and unlock exclusive benefits, including unlimited access to all of our content. Sign up here.