IL Policy: Illinois Waives Food Stamp Work Requirement, Eating Up Funds for Truly Needy

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Welfare programs such as food stamps should offer individuals a hand up – temporary assistance until they are able to get back on their feet – rather than becoming a way of life. Work requirements are an important part of this prescription. Without work requirements, adults can become trapped in the welfare system, which robs them of opportunity. And unfortunately, that’s exactly what’s happening in Illinois today.

Federal welfare legislation signed by former President Bill Clinton in 1996 mandates that able-bodied adults ages 18-49 without dependents must work in order to receive food-stamp benefits. These adults are required to work at least 20 hours per week in order to qualify for food-stamp welfare. If they don’t meet these requirements, their eligibility is limited to three months (in a three-year period).

Most states are enforcing these federal requirements to help these adults get back to work and free up limited resources for those who need them most. Unfortunately, Illinois is not one of these states.

States can opt to waive work requirements and, in the wake of the Great Recession, many states did. In 2015, 42 states waived work requirements, allowing able-bodied adults to stay on welfare indefinitely.

Thankfully, as of October 2016, this trend has largely reversed. Forty-two states are now enforcing work requirements (either statewide or in some regions), leaving just eight states – including Illinois – with no work requirements at all.

Work requirements are wildly popular. Nationally, 79 percent of voters support food-stamp work requirements, including 77 percent of Independents.

But, most importantly, work requirements are good policy. Without work requirements, able-bodied adults are allowed to stay on welfare indefinitely, with no incentive to go back to work, and limited state resources are diverted from the truly needy. With work requirements in place, adults are more likely to work, increase their incomes, and create better lives for themselves than welfare ever could.

Kansas and Maine prove work requirements help get people back into the workforce
Two states serve as examples of the power work requirements have to increase incomes and reduce welfare dependency. Kansas and Maine reinstated work in their food-stamp programs in 2013 and 2014, respectively. Using employment and wage data the state was already collecting, they tracked the income of every adult that left food stamps. What they found was remarkable.

After work requirements were reinstated, Kansas food-stamp enrollees were twice as likely to work, and their incomes more than doubled. But those who left the program were better off as well. Nearly 60 percent of adults who left the program found work within a year, and their incomes more than doubled, more than offsetting lost welfare benefits and leaving them better off than they were before. Overall, wages for these adults increased by $89 million per year, resulting in higher revenues for the state and increased economic activity.

A similar story has unfolded in Maine. After work requirements, able-bodied adult enrollment dropped by more than 90 percent and, within a year of leaving the program, able-bodied adults saw their incomes increase by an average of 114 percent. These adults re-entered the labor force, worked more hours, or increased their earnings. As a result, able-bodied adult enrollees who are working are now above the poverty line, on average.

This is a story that could and should be replicated in Illinois. All policymakers have to do is allow the state’s work waiver to expire.

There are 273,691 able-bodied adults without dependents on food stamps in Illinois, according to the most recently available data from the state. If work requirements were reinstated, based on the experiences of Maine and Kansas, 205,000-230,000 adults in Illinois would be freed from welfare.

With these people returning to the workforce, not only would economic growth improve, but state revenues would increase from the taxes those people would pay. More importantly, the former welfare recipients would experience the joy and dignity of work. And this shift would free resources for the most vulnerable.

People moving from welfare to work wouldn’t be thrown out in the cold – they can increase their work hours while receiving assistance and set themselves on a path to independence. In fact, due to work requirements, wages for able-bodied Illinoisans currently on food stamps are projected to increase by $600 million-$700 million per year, according to estimates from the Foundation for Government Accountability.

This additional economic activity could also generate between $14 million and $16 million in new state income taxes and up to an additional $5 million in state sales tax from new revenue on currently untaxed food purchases.

Gov. Bruce Rauner’s administration has decided to leave the waiver in place, for now. But there’s still time to reverse course: The administration can let the waiver expire. And this simple policy change would improve the lives of hundreds of thousands of Illinoisans, setting them on a path out of welfare dependency and toward self-sufficiency.

This article originally appeared at the Illinois Policy Institute on November 10, 2016.

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