81_FR_67055 81 FR 66866 - Supplemental Nutrition Assistance Program: 2008 Farm Bill Provisions on Clarification of Split Issuance; Accrual of Benefits and Definition Changes

81 FR 66866 - Supplemental Nutrition Assistance Program: 2008 Farm Bill Provisions on Clarification of Split Issuance; Accrual of Benefits and Definition Changes

DEPARTMENT OF AGRICULTURE
Food and Nutrition Service

Federal Register Volume 81, Issue 189 (September 29, 2016)

Page Range66866-66872
FR Document2016-22860

The Food and Nutrition Service (FNS) is proposing changes to the Supplemental Nutrition Assistance Program (SNAP) issuance regulations in accordance with the Food, Conservation and Energy Act of 2008, Public Law 110-234 (``the 2008 Farm Bill''). The proposal would implement several provisions of the 2008 Farm Bill to: Clarify that monthly SNAP benefits must be issued in one lump sum; require SNAP accounts to be inactive for a minimum of 6 months before taking benefits off-line; require benefits taken off-line to be restored within 48 hours of the recipient's request; and require permanent expungement of unused benefits after 12 months of account inactivity. This proposal also addresses the requirement to notify households when benefits are taken off-line. Finally, FNS is updating SNAP definitions in 7 CFR part 271, to reflect the Program's new name and the issuance of benefits through Electronic Benefit Transfer (EBT) systems.

Federal Register, Volume 81 Issue 189 (Thursday, September 29, 2016)
[Federal Register Volume 81, Number 189 (Thursday, September 29, 2016)]
[Proposed Rules]
[Pages 66866-66872]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2016-22860]


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Proposed Rules
                                                Federal Register
________________________________________________________________________

This section of the FEDERAL REGISTER contains notices to the public of 
the proposed issuance of rules and regulations. The purpose of these 
notices is to give interested persons an opportunity to participate in 
the rule making prior to the adoption of the final rules.

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Federal Register / Vol. 81, No. 189 / Thursday, September 29, 2016 / 
Proposed Rules

[[Page 66866]]



DEPARTMENT OF AGRICULTURE

Food and Nutrition Service

7 CFR Parts 271 and 274

RIN 0584-AE02


Supplemental Nutrition Assistance Program: 2008 Farm Bill 
Provisions on Clarification of Split Issuance; Accrual of Benefits and 
Definition Changes

AGENCY: Food and Nutrition Service, USDA.

ACTION: Proposed rule.

-----------------------------------------------------------------------

SUMMARY: The Food and Nutrition Service (FNS) is proposing changes to 
the Supplemental Nutrition Assistance Program (SNAP) issuance 
regulations in accordance with the Food, Conservation and Energy Act of 
2008, Public Law 110-234 (``the 2008 Farm Bill''). The proposal would 
implement several provisions of the 2008 Farm Bill to: Clarify that 
monthly SNAP benefits must be issued in one lump sum; require SNAP 
accounts to be inactive for a minimum of 6 months before taking 
benefits off-line; require benefits taken off-line to be restored 
within 48 hours of the recipient's request; and require permanent 
expungement of unused benefits after 12 months of account inactivity. 
This proposal also addresses the requirement to notify households when 
benefits are taken off-line. Finally, FNS is updating SNAP definitions 
in 7 CFR part 271, to reflect the Program's new name and the issuance 
of benefits through Electronic Benefit Transfer (EBT) systems.

DATES: Written comments must be received on or before November 28, 2016 
to be assured of consideration.

ADDRESSES: The Food and Nutrition Service, USDA, invites interested 
persons to submit comments on this proposed rule. Comments may be 
submitted by one of the following methods:
     Federal e-Rulemaking Portal: Go to http://www.regulations.gov. Preferred method; follow the on-line instructions 
for submitting comments.
     Mail: Comments should be addressed to Vicky T. Robinson, 
Chief, Retailer Management and Issuance Branch, Retailer Policy and 
Management Division, Rm. 418, 3101 Park Center Drive, Alexandria, 
Virginia 22302.
    This proposed rule would codify and clarify certain technical, 
operational aspects to States related to benefit issuance. It also 
requests comment about proposed interpretation of taking benefits off 
line and expunging benefits. All comments submitted in response to this 
proposed rule will be included in the record and will be made available 
to the public. Please be advised that the substance of the comments and 
the identity of the individuals or entities submitting the comments 
will be subject to public disclosure. FNS will make the comments 
publicly available on the Internet via http://www.regulations.gov.

FOR FURTHER INFORMATION CONTACT: Vicky Robinson, Chief, Retailer 
Management and Issuance Branch, Retailer Policy and Management, Rm. 
418, 3101 Park Center Drive, Alexandria, Virginia 22302, or by phone at 
703-305-2476.

SUPPLEMENTARY INFORMATION:

Background

    Sections 4113 (Clarification of Split Issuance) and 4114 (Accrual 
of Benefits) of the 2008 Farm Bill amended section 7 of the Food and 
Nutrition Act of 2008 (7 U.S.C. 2016) (``the Food and Nutrition Act''), 
which pertains to SNAP benefit issuance. In addition, section 4001 
updated the language in the Food and Nutrition Act to reflect the 
Program's name change from the Food Stamp Program to the Supplemental 
Nutrition Assistance Program (SNAP), and section 4115 de-obligated 
coupons as of June 18, 2009, and made EBT cards the sole method of 
benefit delivery.
    This rulemaking proposes to implement the 2008 Farm Bill amendments 
to the Food and Nutrition Act, and to update the general information 
and definitions of 7 CFR part 271 to reflect the Program's new name and 
issuance of benefits through EBT systems. The elimination of all other 
benefit delivery options was addressed in the ``Regulation 
Restructuring: Issuance Regulation Update and Reorganization to Reflect 
the End of Coupon Issuance Systems'' rule published in final at 75 FR 
18377 on April 12, 2010, which became effective on June 11, 2010. The 
2008 Farm Bill provisions addressed in this Proposed Rule were 
implemented through FNS implementing memo on October 1, 2008.

7 CFR Part 271--General Information and Definitions

    FNS is proposing to add new definitions associated with the current 
EBT issuance system and to update the terminology in 7 CFR part 271, to 
reflect the program's new name and the elimination of coupons. 
Furthermore, FNS proposes to change the definition of ``Drug addiction 
or alcoholic treatment and rehabilitation program'' to be consistent 
with current policy, which does not require programs to be eligible to 
receive funding under Part B of title XIX of the Public Health Service 
Act (42 U.S.C. 300x et seq.) in order to redeem SNAP benefits. Programs 
that receive funding under part B of title XIX, programs that are 
eligible to receive funding but do not actually receive funding under 
part B of title XIX, and programs that are not eligible to receive 
funding but operate to further the purposes of part B of title XIX to 
provide treatment to drug addicts and or alcoholics, are all eligible. 
None of the changes to part 271 would have any policy implications.

7 CFR Part 274--Issuance and Use of Program Benefits

    The general provisions proposed in part 274 are statutorily 
required by the Food and Nutrition Act. These provisions were 
administratively implemented on October 1, 2008, via an FNS 
implementation memo, but would be codified with this proposed rule. The 
discussion below and the subsequent regulatory language for this part 
provide additional details to address operational processes and/or 
clarify current policy. Where FNS is also proposing changes to current 
processes, it is so noted.

Split Issuance

    Prior to the 2008 Farm Bill, some State agencies had received 
strong interest from stakeholders to divide each individual household's 
monthly allotment into two or more issuances over the month. Up to that 
point, no State had ever split households' benefit allotments. While 
not explicitly

[[Page 66867]]

prohibiting splitting the issuance of monthly allotments, the current 
SNAP regulations are based on a one-time issuance per month for ongoing 
benefits with 7 CFR 274.2(d) stating that ``all households shall be 
placed on an issuance schedule so that they receive their benefits on 
or about the same date each month.''
    The purpose of splitting benefit allotments, according to retail 
industry proponents, would be to help authorized SNAP stores better 
manage their food stock, employee hours and traffic flow. Proponents 
have also suggested that it would ensure that SNAP participants spread 
their benefit spending over the course of the month instead of 
depleting the entire allotment early on and not having sufficient funds 
to meet their nutritional needs as the end of the month approaches. 
However, section 4113 of the 2008 Farm Bill now requires that State 
agencies issue a household's ongoing monthly benefit allotment in one 
lump sum. Proponents of the one issuance per month limitation have 
argued that requiring the entire monthly benefit allotment to be issued 
at one time allows households to make large buying trips and to 
purchase large, economy-size containers of staple foods. It also allows 
households with small benefit amounts--such as seniors or those with 
limited transportation options--to make one shopping trip during the 
month.
    To address retailer concerns regarding monthly spikes in traffic 
flow, State agencies have the option to stagger the issuance of 
benefits to individual households over multiple days of the month in 
accordance with 7 CFR 274.2(d)(1). Staggered issuance, in this context, 
means issuing benefits to a group of SNAP recipients on one date of a 
month, and issuing benefits to another group of recipients on a 
different date of the month, and so on, so that all SNAP recipients in 
the State are not receiving their monthly allotment and shopping on the 
same day. Staggered issuance allows authorized SNAP stores to manage 
better their food stock, employee hours and traffic flow, while still 
allowing recipients to make bulk purchases and/or limit their shopping 
trips to once per month. When a State agency changes its issuance 
schedule to institute or expand a staggered issuance schedule, State 
agencies would continue to have the option to divide the issuances into 
two parts during the transition month to meet the requirement that no 
more than 40 days elapses between the issuance of any two allotments 
provided to a household participating longer than two consecutive, 
complete months. In general, the prohibition against splitting ongoing 
monthly issuances is not intended to change policy or practice with 
respect to the issuance of benefits in any other area, including 
expedited benefits, the proration of benefits for partial months, the 
issuance of supplemental benefits in the event a benefit correction is 
necessary, or the option to issue benefits semimonthly to residents of 
drug or alcohol addiction treatment facilities.
    This provision would be codified at 7 CFR 274.2(c).

Benefit Expungement

    Under the previous food stamp coupon issuance system, paper coupons 
did not have an expiration date. Households could accumulate an 
unlimited amount of benefits in the form of paper coupons and spend 
them at any time in the future, until the 2008 Farm Bill de-obligated 
all food stamp coupons as of June 2009. Currently under EBT, consistent 
with section 4115 of the 2008 Farm Bill, benefits are expunged 
(permanently removed) from inactive accounts if the account has been 
inactive for one year. Current policy considers an account active if 
the household initiates an action that affects the balance of the 
account, such as a purchase or refund, at least once every 12 months. 
As long as the account is active, States are not allowed to expunge any 
benefits even if there are benefits in the account that were issued 
more than 12 months ago. Only when the account has been inactive for 12 
months, may State agencies begin to permanently remove benefits from a 
household's account at the benefit allotment level. This policy and 
approach to expungement was in place through regulations prior to the 
2008 Farm Bill.
    The 2008 Farm Bill requires State agencies to establish a procedure 
for recovering electronic benefits from a household's account due to 
inactivity and to expunge benefits that have not been accessed by a 
household after a period of 12 months. Because expungement has been a 
regulatory requirement since the beginning of EBT implementation, all 
State agencies already have a process in place for expunging benefits 
from a household's EBT account due to inactivity. Furthermore, the 2008 
Farm Bill implementation memo issued on July 3, 2008, maintained the 
current expungement process outlined in the previous paragraph. 
However, after further review of the statutory language, FNS has 
determined that there is sufficient ambiguity in the language to allow 
for two different interpretations.
    Section 7(h)(12)(C) of the Food and Nutrition Act reads, ``A State 
agency shall expunge benefits that have not been accessed by a 
household after a period of 12 months.'' This language could be 
interpreted to support SNAP's current expungement policy 
(interpretation #1) of only expunging benefits from EBT accounts that 
have not been accessed in 12 months (i.e., inactive accounts). This 
interpretation focuses on the account referenced in section 7(h)(12)(A) 
of the statute, which requires State agencies to establish a procedure 
for recovering electronic benefits from the account of a household due 
to inactivity. Another interpretation (interpretation #2) could be that 
benefits that have not been used after 12 months must be expunged 
regardless of whether the household has accessed the account (i.e., 
regardless of account activity).
    Since the 2008 Farm Bill passed, FNS has received feedback from 
some States in support of the second interpretation. This support 
emphasizes that SNAP households should be prevented from accumulating 
excessively high balances in their SNAP EBT accounts. High balances, 
some States have indicated, do not align with the true intent of the 
program, and hold taxpayer money inactive that could otherwise be spent 
in a beneficial way. As a result, FNS is requesting comments through 
this proposed rulemaking to obtain further feedback from State agencies 
as well as other stakeholders, such as advocates and EBT processors, 
regarding the possibility of changing the current expungement process 
to reflect a process in line with interpretation #2.
    Under interpretation #2, FNS is particularly interested in 
receiving comments on how to address a scenario in which a household 
receives restored benefits for multiple months in one lump sum as a 
result of a fair hearing finding. This is one possible reason a 
household might have a large SNAP balance. FNS understands that, in 
these types of situations, a household would have a shorter period of 
time overall to spend the restored benefits they were entitled to 
receive for previous months than would have been the case if the 
benefits were provided monthly as originally required. The restored 
benefits would be in addition to any ongoing benefits the household is 
receiving, which must also be spent within 12 months. However, FNS is 
also sensitive to the automated system processes that would be impacted 
if it instituted exceptions to a requirement that State agencies 
expunge unused benefits 12 months after they were issued.

[[Page 66868]]

    In addition to comments on each of the two expungement policy 
interpretations, FNS is also interested in receiving comments on 
whether every State agency should be given the option to choose one of 
the two expungement processes discussed here. Therefore, both 
expungement processes (i.e. expunging unused benefits after one year of 
account inactivity or expunging unused benefits one year after each 
allotment is issued) would be allowed, giving each State agency the 
flexibility to choose which process to implement.
    Respondents who support the second alternative (i.e. expunging 
unused benefits one year after each allotment is issued), either as 
mandatory or as an option, should also provide comments regarding 
household notification of the new expungement policy and suggested 
effective dates. For example, would an effective date of one year after 
the final rule's publication date be a suitable timeframe for providing 
notice to clients that unused benefits over 12 months old will be 
permanently expunged or should the timeframe be longer or shorter and 
why?
    To summarize: Under interpretation #1, SNAP benefits would only be 
expunged if the account has been inactive for 12 months. As long as the 
account is active, no benefits would be expunged regardless of when the 
benefits were issued, and benefits could continue to accumulate as long 
as the household remains eligible for benefits. Under interpretation 
#2, households would have 12 months from the date of issuance to spend 
each benefit allotment they receive even if the household is accessing 
the account and using benefits.
    In this proposed rule, the proposed regulatory language is in line 
with the 2008 Farm Bill Implementation Memo, which mirrored current 
policy of expunging benefits only from inactive EBT accounts. Final 
language will take into consideration the comments received regarding 
both possible expungement interpretations discussed above.
    This rulemaking also proposes to codify the current policy of 
requiring State agencies to expunge benefits at the benefit allotment 
level. In other words, the entire balance of a SNAP EBT account could 
not be permanently removed due to inactivity if there are benefit 
allotments that have not been available to the household for at least 
12 months. Instead, the State would need to wait 12 months from the 
date when each benefit allotment was issued to the household or from 
the last date of account activity, whichever date is later, before 
expunging those particular funds.
    Furthermore, to ensure that benefits are not available to the 
household longer than allowed by statute, FNS is proposing to require 
State agencies to expunge benefits from the EBT system or, if offline, 
from the State records on a daily basis.
    This proposed rule also clarifies that the expungement timeframe 
requirement would not apply to cases that have been closed due to the 
death of all household members. In most cases, this provision would 
apply to one-person households. Once the State agency has confirmed a 
death match and closed the case in accordance with 7 CFR 272.14, there 
is no one left in the household who is entitled to the benefits. In 
such cases, State agencies would be required to permanently expunge all 
SNAP benefits in the household's account regardless of when the 
benefits were issued or last used. This provision would prevent 
unauthorized persons from accessing and using benefits that remain in a 
deceased household's account. For all other SNAP cases, benefits would 
continue to remain in the SNAP account even after the SNAP case is 
closed (unless taken off-line due to inactivity as discussed below) 
until the benefits have aged off in accordance with expungement 
requirements.
    This provision would be codified at 7 CFR 274.2(h)(2).

Moving Benefits Off-Line

    Prior to the 2008 Farm Bill, EBT regulations allowed State agencies 
to move all benefits in an inactive SNAP account off-line if the 
account had not been accessed over a three-month period. Once benefits 
are taken off-line, they are no longer immediately accessible to the 
household, but must be reinstated if the household reapplies for the 
program or requests that the remaining benefits be moved back on-line 
prior to expungement. However, some households, especially seniors who 
qualify for a small amount of benefits, have been known to save up 
those smaller amounts and use several months' worth in one shopping 
trip. For these households, three months may have been too short a 
period before moving benefits off-line. As a result, section 4114 of 
the 2008 Farm Bill stipulated 6 months as the time period that an EBT 
account must be inactive before a State agency may move benefits off-
line. State agencies are not required to take inactive benefits off-
line at all prior to expungement, but if a State agency wishes to 
exercise the option to do so, it must wait until an EBT account has 
been inactive for at least 6 months. In accordance with the July 3, 
2008, implementing memo, this provision was implemented on October 1, 
2008.
    Because ``off-line'' was not previously defined in regulations, FNS 
is taking this opportunity to propose such a definition. The off-line 
definition would not impact a client's ability to get benefits 
reinstated, or the timeframes. The definition serves only to provide 
State agencies and EBT processors the parameters for operationalizing 
the off-line provision. FNS welcomes comments regarding the impact this 
definition would have on State agencies' EBT issuance systems.
    Going forward, taking benefits ``off-line'' would mean that the 
benefits are being removed from the EBT account and the EBT system. 
Moreover, this regulation proposes that, when taking benefits off-line, 
from a financial management perspective, the EBT contractor treat these 
benefits like expungements by removing benefits from the Account 
Management Agent (AMA). The AMA is an accounting system that interfaces 
with the U.S. Department of Treasury to keep track of benefit 
authorizations, returned benefits such as expungements, and benefit 
redemptions. However, unlike a permanent expungement, information about 
the benefits (amount, availability date, last used date, etc.) would be 
stored elsewhere so that the benefits can be reissued upon timely 
contact by the household.
    The law does not allow State agencies to make SNAP benefits in an 
inactive EBT account inaccessible to a client prior to expungement, 
unless they exercise the option to store benefits off-line within the 
permitted timeframes. Therefore, under the proposed definition of 
``off-line'', State agencies would no longer be able to flag an account 
as ``dormant'' or otherwise deactivate the account to make benefits 
inaccessible to the client, and yet keep the benefits on-line. FNS is 
proposing this limitation because such a practice would defeat the 
logic of the original regulation that permitted benefits to be moved 
off-line. When the original regulation to allow State agencies to take 
benefits off-line was implemented, the increased computer system 
capacity needed to maintain all EBT accounts on-line was more expensive 
than it is now. By taking inactive EBT accounts off-line, the goal was 
to reduce the overall cost of EBT services. The incremental cost of 
additional system capacity, however, is now considerably less 
expensive. Therefore, the financial motives for moving benefits off-
line are no longer a significant factor. Nevertheless, some State 
agencies are choosing to make benefits inaccessible

[[Page 66869]]

after a period of inactivity in order to establish contact with the 
household and verify continued eligibility. FNS believes this is 
contrary to the intent of the law. Therefore, as noted above, this rule 
would no longer permit the practice of simply making benefits 
inaccessible without actually moving them off-line. Furthermore, by 
taking the benefits out of the EBT system, this provision would provide 
additional system security by preventing unauthorized persons from 
accessing and using accumulated benefits that remain dormant in a 
household's account. State agencies would still be able to flag a 
household's EBT account at various stages of inactivity for monitoring 
purposes, but the benefits would need to remain accessible to the 
household unless moved off-line or permanently expunged.
    Section 4114 of the 2008 Farm Bill also requires State agencies to 
send a notice to the household when the household's benefits are taken 
off-line and to make the benefits available again within 48 hours of 
the household's request. The Congressional intent, as stipulated in the 
Congressional record, was that notification be closely tied to the date 
benefits would move off-line. Therefore, this rule proposes in 
273.2(h)(1) to allow States to choose when to provide notification as 
long as it is within 10 days prior to or concurrent with moving 
benefits off-line. Although not required, some State agencies may want 
to give clients sufficient notice to access the account to prevent 
benefits from being taken off-line altogether. Because individual off-
line notification is now a statutory requirement, State agencies may no 
longer receive a waiver to provide general off-line notification as 
part of initial training or recertification. Inactive accounts with a 
zero balance that are taken off-line do not require a notice because no 
actual benefits are made inaccessible to the household.
    As already required at 7 CFR 274.2(h)(1), the notice must describe 
the steps necessary to bring the recovered benefits back on-line. State 
agencies should make the process for reinstating off-line benefits 
simple for households. A general request for assistance from a 
household that has had benefits moved off-line should be considered a 
request for reinstatement of benefits. In other words, households 
should not have to follow a complicated reinstatement option in order 
to get benefits restored to their accounts. Rather, eligibility workers 
and local office or call center employees should assist households in 
initiating the process for reinstating benefits. Once the benefits are 
reinstated, the benefit aging process must start over so that the 
household has another six months to access the account before the 
reinstated benefits are taken off-line again, and another 12 months to 
access the account before those benefits are expunged due to 
inactivity.
    This provision would be codified at 7 CFR 274.2(h)(1).

Procedural Matters

Executive Order 12866 and Executive Order 13563

    Executive Orders 12866 and 13563, direct agencies to assess all 
costs and benefits of available regulatory alternatives and, if 
regulation is necessary, to select regulatory approaches that maximize 
net benefits (including potential economic, environmental, public 
health and safety effects, distributive impacts, and equity). Executive 
Order 13563 emphasizes the importance of quantifying both costs and 
benefits, of reducing costs, of harmonizing rules and of promoting 
flexibility. This proposed rule has been determined to be not 
significant and was not reviewed by the Office of Management and Budget 
(OMB) in conformance with Executive Order 12866.

Regulatory Impact Analysis

    This proposed rule has been designated as not significant by the 
Office of Management and Budget, therefore, no Regulatory Impact 
Analysis is required.

Regulatory Flexibility Act

    The Regulatory Flexibility Act (5 U.S.C. 601-612) requires Agencies 
to analyze the impact of rulemaking on small entities and consider 
alternatives that would minimize any significant impacts on a 
substantial number of small entities. Pursuant to that review, this 
rule is certified not to have a significant impact on a substantial 
number of small entities.

Unfunded Mandates Reform Act

    Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), Public 
Law 104-4, establishes requirements for Federal agencies to assess the 
effects of their regulatory actions on State, local and Tribal 
governments and the private sector. Under section 202 of the UMRA, the 
Department generally must prepare a written statement, including a 
cost/benefit analysis, for proposed and final rules with Federal 
mandates that may result in expenditures to State, local, or Tribal 
governments, in the aggregate, or to the private sector, of $100 
million or more in any one year. When such a statement is needed for a 
rule, section 205 of the UMRA generally requires the Department to 
identify and consider a reasonable number of regulatory alternatives 
and adopt the least costly, more cost-effective or least burdensome 
alternative that achieves the objectives of the rule.
    This proposed rule does not contain Federal mandates (under the 
regulatory provisions of Title II of the UMRA) that impose costs on 
State, local, or tribal governments or to the private sector of $100 
million or more in any one year. This proposed rule is, therefore, not 
subject to the requirements of sections 202 and 205 of the UMRA.

Executive Order 12372

    SNAP is listed in the Catalog of Federal Domestic Assistance under 
No. 10.551. For the reasons set forth in 2 CFR chapter IV, this Program 
is excluded from the scope of Executive Order 12372, which requires 
intergovernmental consultation with state and local officials.

Executive Order 13132

    Executive Order 13132, requires Federal agencies to consider the 
impact of their regulatory actions on State and local governments. 
Where such actions have federalism implications, agencies are directed 
to provide a statement for inclusion in the preamble to the regulations 
describing the agency's considerations in terms of the three categories 
called for under section (6)(b)(2)(B) of Executive Order 13132. FNS has 
considered the impact of this proposed rule on State and local 
governments and has determined that this rulemaking does not have 
federalism implications. This proposed rule does not impose substantial 
or direct compliance costs on State and local governments. Therefore, 
under section 6(b) of the Executive Order, a federalism summary impact 
statement is not required.

Executive Order 12988

    This proposed rule has been reviewed under Executive Order 12988, 
Civil Justice Reform. This proposed rule is intended to have preemptive 
effect with respect to any State or local laws, regulations or policies 
which conflict with its provisions or which would otherwise impede its 
full implementation. This proposed rule is not intended to have 
retroactive effect unless specified in the DATES section of the final 
rule. Prior to any judicial challenge to the provisions of this rule or 
the application of its provisions, all applicable administrative 
procedures must be exhausted.

[[Page 66870]]

Executive Order 13175

    Executive Order 13175, requires Federal agencies to consult and 
coordinate with tribes on a government-to-government basis on policies 
that have tribal implications, including regulations, legislative 
comments or proposed legislation, and other policy statements or 
actions that have substantial direct effects on one or more Indian 
tribes, on the relationship between the Federal Government and Indian 
tribes, or on the distribution of power and responsibilities between 
the Federal Government and Indian tribes. In late 2010 and early 2011, 
USDA engaged in a series of consultative sessions to obtain input by 
tribal officials or their designees concerning the impact of this 
rulemaking on the tribe or Indian tribal governments, or whether this 
rulemaking may preempt tribal law. USDA did not receive any comments 
specific to this proposed rule during the sessions. Reports from the 
consultative sessions were made part of the USDA annual reporting on 
Tribal Consultation and Collaboration. USDA offers consultation 
opportunities, such as webinars and teleconferences, for collaborative 
conversations with tribal leaders and their representatives concerning 
ways to improve rules with regard to their effect on Indian country on 
a quarterly basis as part of its yearly tribal consultation schedule.
    We are unaware of any current tribal laws that could be in conflict 
with the proposed rule. We request that commenters address any concerns 
in this regard in their responses.

Civil Rights Impact Analysis

    FNS has reviewed this rule in accordance with Departmental 
Regulations 4300-4, ``Civil Rights Impact Analysis,'' and 1512-1, 
``Regulatory Decision Making Requirements.'' After a careful review of 
the rule's intent and provisions, FNS has determined that this proposed 
rule will not in any way limit or reduce the ability of protected 
classes of individuals to receive SNAP benefits on the basis of their 
race, color, national origin, sex, age, disability, religion or 
political belief nor will it have a differential impact on minority 
owned or operated business establishments, and woman owned or operated 
business establishments that participate in SNAP.

Paperwork Reduction Act

    The Paperwork Reduction Act of 1995 (44 U.S.C. chap. 35; see 5 CFR 
1320) requires the Office of Management and Budget (OMB) approve all 
collections of information by a Federal agency before they can be 
implemented. Respondents are not required to respond to any collection 
of information unless it displays a current valid OMB control number. 
This proposed rule does not contain information collection requirements 
subject to approval by OMB under the Paperwork Reduction Act of 1995.

E-Government Act Compliance

    The Food and Nutrition Service is committed to complying with the 
E-Government Act, to promote the use of the Internet and other 
information technologies to provide increased opportunities for citizen 
access to Government information and services, and for other purposes.

List of Subjects in 7 Parts 271 and 274

    Food stamps, Grant programs--social programs, Reporting and 
recordkeeping requirements.

    For reason set forth in the preamble, 7 CFR parts 271 and 274 are 
proposed to be amended as follows:

SUBCHAPTER C--[AMENDED]

0
1. In the heading of subchapter C of chapter II, remove the words 
``Food Stamp'' and add in their place the words ``Supplemental 
Nutrition Assistance''.
0
2. The authority citation for 7 CFR parts 271 and 274 continues to read 
as follows:

    Authority: 7 U.S.C. 2011-2036.

PART 271--GENERAL INFORMATION AND DEFINITIONS


Sec.  271.1   General purpose and scope.

0
3. In Sec.  271.1:
0
a. Revise paragraph (a);
0
b. Remove the word ``coupons'' from the fourth sentence of paragraph 
(b) and add in its place ``SNAP benefits''; and
0
c. Remove the word ``coupon'' from the tenth sentence of paragraph (b) 
and add in its place ``benefit''.
    The revision reads as follows:


Sec.  271.1   General purpose and scope.

    (a) Purpose of SNAP. In accordance with section 2 of the Food and 
Nutrition Act of 2008, SNAP is designed to promote the general welfare 
and to safeguard the health and well being of the Nation's population 
by raising the levels of nutrition among low-income households.
* * * * *
0
4. In Sec.  271.2:
0
a. Amend the definition of Allotment by removing the word ``coupons'' 
and adding in its place the word ``benefits'';
0
b. Remove the definition of Authorization to participate card (ATP);
0
c. Add definitions for Benefit and Benefit issuer in alphabetical 
order;
0
d. Remove the definition of Bulk storage point;
0
e. Add a definition for Contractor (or Contracted vendor) in 
alphabetical order;
0
f. Remove the definitions of Coupon issuer and Direct access system;
0
g. Revise the definition of Drug addiction or alcoholic treatment and 
rehabilitation program;
0
h. Add definitions for Electronic Benefit Transfer (EBT) account, 
Electronic Benefit Transfer (EBT) card, and Electronic Benefit Transfer 
(EBT) system in alphabetical order;
0
i. Amend the definition of Eligible foods by removing the word 
``coupons'' where it appears twice in paragraph (3) of the definition, 
and adding in its place the words ``SNAP benefits'';
0
j. Amend the definition of Employment and training (E&T) component by 
removing ``6(d)(4)(B)(iv)'' and adding in its place ``6(d)(4)(B)'' and 
by removing ``(7 U.S.C. 2014(2)(4)(B))'' and adding in its place ``(7 
U.S.C. 2015(d)(4)(B))'';
0
k. Amend the definition of Employment and training (E&T) mandatory 
participant by removing ``7 U.S.C. 2014(d)(1)'' and adding in its place 
``7 U.S.C. 2015(d)(1)'';
0
l. Amend the definition of Firm's practice by removing the words ``food 
coupons'' and adding in their place the words ``SNAP benefits'';
0
m. Add a definition for Food and Nutrition Act of 2008 (Food and 
Nutrition Act) in alphabetical order;
0
n. Revise the definition of Food Stamp Act;
0
o. Amend the definition of Identification (ID) card by removing the 
words ``food coupons'' and adding in its place the words ``SNAP 
benefits'';
0
p. Add definitions for Interoperability, Manual transaction, and Manual 
voucher in alphabetical order;
0
q. Amend the definition of Overissuance by removing the word 
``coupons'' and adding in its place the word ``benefits'';
0
r. Add definitions for Personal identification number (PIN), Point-of-
sale (POS) terminal, and Primary account number (PAN) in alphabetical 
order;
0
s. Remove the definition of Program;
0
t. Add definitions for Retailer EBT Data Exchange (REDE) system and 
Supplemental Nutrition Assistance Program (SNAP or Program) in 
alphabetical order.
    The additions and revisions read as follows:


Sec.  271.2   Definitions.

* * * * *

[[Page 66871]]

    Benefit means the value of supplemental nutrition assistance 
provided to a household by means of an EBT system or other means of 
providing assistance, as determined by the Secretary.
    Benefit issuer means any office of the State agency or any person, 
partnership, corporation, organization, political subdivision or other 
entity with which a State agency has contracted for, or to which it has 
delegated functional responsibility, in connection with the issuance of 
benefits to households.
* * * * *
    Contractor (or contracted vendor) means an entity that is selected 
to perform EBT-related services for the State agency.
* * * * *
    Drug addiction or alcoholic treatment and rehabilitation program 
means any drug addiction or alcoholic treatment and rehabilitation 
program conducted by a private, nonprofit organization or institution, 
or a publicly operated community mental health center and certified by 
the requisite State title XIX Agency as:
    (1) Receiving funding under part B of title XIX of the Public 
Health Service Act (42 U.S.C. 300x et seq.);
    (2) Eligible to receive funding under part B of title XIX even if 
it does not actually receive funding; or
    (3) Operating to further the purposes of part B of title XIX, to 
provide treatment to drug addicts and or alcoholics.
    Electronic Benefit Transfer (EBT) account means a set of records 
containing demographic, card, benefit, transaction and balance data for 
an individual household within the EBT system that is maintained and 
managed by a State or its contractor as part of the client case record.
    Electronic Benefit Transfer (EBT) card means an on-line magnetic 
stripe card or off-line smart card issued to a household member or 
authorized representative through the EBT system by a benefit issuer.
* * * * *
    Electronic Benefit Transfer (EBT) system means an electronic 
payments system under which household benefits are issued from and 
stored in a central databank, maintained and managed by a State or its 
contractor, that uses electronic funds transfer and point-of-sale 
technology for the delivery and control of food and other public 
assistance benefits.
* * * * *
    Food and Nutrition Act of 2008 (Food and Nutrition Act) means title 
7 of the United States Code, sections 2011 through 2036 (7 U.S.C. 2011-
2036), including any subsequent amendments thereto.
    Food Stamp Act means the Food Stamp Act of 1977 (Pub. L. 95-113) as 
amended through Public Law 108-269, July 2, 2004.
* * * * *
    Interoperability means a system that enables program benefits 
issued via an EBT card to be redeemed outside the State that issued the 
benefits.
* * * * *
    Manual transaction means an EBT transaction that is processed with 
the use of a paper manual voucher when there is an EBT system outage.
    Manual voucher means a paper document signed by the EBT cardholder 
that allows a retailer to redeem benefits through a manual transaction.
    Personal Identification Number (PIN) means a numeric code selected 
by or assigned to a household and used to verify the identity of an EBT 
cardholder when performing an EBT transaction.
* * * * *
    Point-of-Sale (POS) terminal means a range of devices deployed at 
authorized retail food stores for redeeming benefits through the use of 
an EBT card and PIN to initiate electronic debits and credits of 
household EBT and retailer bank accounts.
    Primary Account Number (PAN) means a number embossed or printed on 
the EBT card and encoded onto the card to identify the State and EBT 
account holder.
* * * * *
    Retailer EBT Data Exchange (REDE) system means the FNS system that 
allows the automated exchange of authorized retailer demographic data 
between FNS and the State and/or EBT contractor for notification of 
changes in retailer Program participation.
* * * * *
    Supplemental Nutrition Assistance Program (SNAP or Program) means 
the program operated pursuant to the Food and Nutrition Act of 2008.
* * * * *


Sec.  271.4   [Amended]

0
5. In Sec.  271.4(a)(2) remove the word ``coupons'' and add in its 
place ``SNAP benefits and EBT cards''.


Sec.  271.5   [Amended]

0
6. In Sec.  271.5:
0
a. Remove ``coupon'' and ``coupons'' wherever they appear and add in 
their place ``benefit'' and ``benefits'', respectively, including the 
section heading;
0
b. Amend paragraph (a) by adding ``and EBT cards'' at the end of the 
last sentence;
0
c. Amend the introductory text of paragraph (b) by removing the word 
``ATP'' and adding in its place the word ``EBT'';
0
d. Remove paragraphs (b)(1) through (3); and
0
e. Amend paragraph (c) by removing the word ``ATP's'' wherever they 
appear and adding in its place the words ``EBT cards''.

PART 274--ISSUANCE AND USE OF BENEFITS

0
7. In Sec.  274.2:
0
a. Revise paragraph (c);
0
b. Amend paragraph (e)(1) by removing the words ``of paragraphs (e) 
through (h)'';
0
c. Amend paragraph (g)(3) by removing the words ``paragraph (h)(3)'' 
and adding the words ``paragraph (i)'';
0
d. Revise paragraph (h);
0
e. Add paragraph (i).
    The revisions and additions read as follows:


Sec.  274.2  Providing benefits to participants.

* * * * *
    (c) Benefit allotments. (1) State agencies shall not issue ongoing 
monthly benefit allotments to a household in more than one issuance 
during a month except with respect to the issuance of benefits to a 
resident of a drug and alcohol treatment and rehabilitation program in 
accordance with Sec.  273.11(e) of this chapter.
    (2) For those households which are to receive a combined allotment, 
the State agency shall provide the benefits for both months as an 
aggregate (combined) allotment, or as two separate allotments, made 
available at the same time in accordance with the timeframes specified 
in Sec.  273.2 of this chapter.
* * * * *
    (h) Inactive EBT accounts. An inactive EBT account means that the 
household has not initiated activity that affects the balance of the 
household's SNAP benefits in the account, such as a purchase or return, 
for a minimum of six months.
    (1) Off-line storage. If a household's EBT account is inactive for 
six months or longer, State agencies may elect to store all benefits in 
that account off-line.
    (i) Off-line benefits are benefits that have been removed from the 
EBT system for storage by the State agency and are no longer accessible 
to the household unless and until the benefits are reinstated upon 
contact by the household.
    (ii) The State agency shall send written notification to the 
household up to 10 days prior to or concurrent with the action to store 
benefits off-line and

[[Page 66872]]

describe the steps necessary to bring the benefits back on-line. If an 
inactive account has a zero balance, a notice to the household is not 
required.
    (iii) Benefits stored off-line that have not reached the 12-month 
timeframe for expungement in accordance with paragraph (h)(2) of this 
section shall be reinstated and made available within 48 hours of 
reapplication or contact by the household.
    (iv) Off-line benefits shall be removed from the Account Management 
Agent system, making them unavailable to the household. Upon 
reinstatement, the benefits shall be reissued and the account shall be 
reactivated or a new account established to resume the benefit aging 
process from the new issuance date.
    (2) Expungement. On a daily basis, the State agency shall expunge 
benefits from accounts that have been inactive for a period of 12 
months in accordance with the following:
    (i) When the oldest benefit allotment has not been accessed by the 
household for 12 months, the State agency shall expunge benefits from 
the EBT account or off-line storage at the monthly benefit allotment 
level as each benefit allotment ages to 12 months since the date of 
issuance or since the last date of account activity, whichever date is 
later.
    (ii) Expunged benefits shall be removed from the Account Management 
Agent unless already removed as provided in paragraph (h)(1) of this 
section, and shall not be reinstated.
    (iii) The State agency shall not expunge any benefits from active 
accounts even if there are benefit allotments older than 12 months. If 
at any time after the expungement process begins, the household 
initiates activity affecting the balance of the account, the State 
shall stop expunging benefits from the account and start the account 
aging process over again for the remaining benefits.
    (iv) Notwithstanding the paragraph (h)(2)(iii) of this section, in 
instances when the State agency verifies a death match for all 
certified members of the household and closes the SNAP case in 
accordance with Sec.  272.14 of this chapter, the State agency shall 
expunge the remaining SNAP balance in the household's EBT account at 
that time.
    (i) Procedures to adjust SNAP accounts. Procedures shall be 
established to permit the appropriate managers to adjust SNAP benefits 
that have already been posted to an EBT account prior to the household 
accessing the account; or to remove benefits from inactive accounts for 
off-line storage or expungement in accordance with paragraph (h) of 
this section.
    (1) Whenever benefits are stored off-line or expunged, the State 
agency shall document the date, amount of the benefits and storage 
location in the household case file.
    (2) Issuance reports shall reflect the adjustment to the State 
agency issuance totals to comply with monthly issuance reporting 
requirements prescribed under Sec.  274.4.

    Dated: September 14, 2016.
Telora T. Dean,
Acting Administrator, Food and Nutrition Service.
[FR Doc. 2016-22860 Filed 9-28-16; 8:45 am]
 BILLING CODE 3410-30-P



                                                      66866

                                                      Proposed Rules                                                                                                Federal Register
                                                                                                                                                                    Vol. 81, No. 189

                                                                                                                                                                    Thursday, September 29, 2016



                                                      This section of the FEDERAL REGISTER                    method; follow the on-line instructions               the End of Coupon Issuance Systems’’
                                                      contains notices to the public of the proposed          for submitting comments.                              rule published in final at 75 FR 18377
                                                      issuance of rules and regulations. The                     • Mail: Comments should be                         on April 12, 2010, which became
                                                      purpose of these notices is to give interested          addressed to Vicky T. Robinson, Chief,                effective on June 11, 2010. The 2008
                                                      persons an opportunity to participate in the            Retailer Management and Issuance                      Farm Bill provisions addressed in this
                                                      rule making prior to the adoption of the final
                                                                                                              Branch, Retailer Policy and                           Proposed Rule were implemented
                                                      rules.
                                                                                                              Management Division, Rm. 418, 3101                    through FNS implementing memo on
                                                                                                              Park Center Drive, Alexandria, Virginia               October 1, 2008.
                                                      DEPARTMENT OF AGRICULTURE                               22302.
                                                                                                                                                                    7 CFR Part 271—General Information
                                                                                                                 This proposed rule would codify and
                                                                                                                                                                    and Definitions
                                                      Food and Nutrition Service                              clarify certain technical, operational
                                                                                                              aspects to States related to benefit                     FNS is proposing to add new
                                                      7 CFR Parts 271 and 274                                 issuance. It also requests comment                    definitions associated with the current
                                                                                                              about proposed interpretation of taking               EBT issuance system and to update the
                                                                                                              benefits off line and expunging benefits.             terminology in 7 CFR part 271, to reflect
                                                      RIN 0584–AE02
                                                                                                              All comments submitted in response to                 the program’s new name and the
                                                      Supplemental Nutrition Assistance                       this proposed rule will be included in                elimination of coupons. Furthermore,
                                                      Program: 2008 Farm Bill Provisions on                   the record and will be made available to              FNS proposes to change the definition
                                                      Clarification of Split Issuance; Accrual                the public. Please be advised that the                of ‘‘Drug addiction or alcoholic
                                                      of Benefits and Definition Changes                      substance of the comments and the                     treatment and rehabilitation program’’
                                                                                                              identity of the individuals or entities               to be consistent with current policy,
                                                      AGENCY:  Food and Nutrition Service,                    submitting the comments will be subject               which does not require programs to be
                                                      USDA.                                                   to public disclosure. FNS will make the               eligible to receive funding under Part B
                                                      ACTION: Proposed rule.                                  comments publicly available on the                    of title XIX of the Public Health Service
                                                                                                              Internet via http://www.regulations.gov.              Act (42 U.S.C. 300x et seq.) in order to
                                                      SUMMARY:    The Food and Nutrition                                                                            redeem SNAP benefits. Programs that
                                                                                                              FOR FURTHER INFORMATION CONTACT:
                                                      Service (FNS) is proposing changes to                                                                         receive funding under part B of title
                                                                                                              Vicky Robinson, Chief, Retailer
                                                      the Supplemental Nutrition Assistance                                                                         XIX, programs that are eligible to
                                                                                                              Management and Issuance Branch,
                                                      Program (SNAP) issuance regulations in                                                                        receive funding but do not actually
                                                                                                              Retailer Policy and Management, Rm.
                                                      accordance with the Food, Conservation                                                                        receive funding under part B of title
                                                                                                              418, 3101 Park Center Drive,
                                                      and Energy Act of 2008, Public Law                                                                            XIX, and programs that are not eligible
                                                                                                              Alexandria, Virginia 22302, or by phone
                                                      110–234 (‘‘the 2008 Farm Bill’’). The                                                                         to receive funding but operate to further
                                                                                                              at 703–305–2476.
                                                      proposal would implement several                                                                              the purposes of part B of title XIX to
                                                                                                              SUPPLEMENTARY INFORMATION:                            provide treatment to drug addicts and or
                                                      provisions of the 2008 Farm Bill to:
                                                      Clarify that monthly SNAP benefits                      Background                                            alcoholics, are all eligible. None of the
                                                      must be issued in one lump sum;                                                                               changes to part 271 would have any
                                                                                                                 Sections 4113 (Clarification of Split              policy implications.
                                                      require SNAP accounts to be inactive for
                                                                                                              Issuance) and 4114 (Accrual of Benefits)
                                                      a minimum of 6 months before taking                                                                           7 CFR Part 274—Issuance and Use of
                                                                                                              of the 2008 Farm Bill amended section
                                                      benefits off-line; require benefits taken                                                                     Program Benefits
                                                                                                              7 of the Food and Nutrition Act of 2008
                                                      off-line to be restored within 48 hours
                                                                                                              (7 U.S.C. 2016) (‘‘the Food and Nutrition               The general provisions proposed in
                                                      of the recipient’s request; and require
                                                                                                              Act’’), which pertains to SNAP benefit                part 274 are statutorily required by the
                                                      permanent expungement of unused
                                                                                                              issuance. In addition, section 4001                   Food and Nutrition Act. These
                                                      benefits after 12 months of account
                                                                                                              updated the language in the Food and                  provisions were administratively
                                                      inactivity. This proposal also addresses
                                                                                                              Nutrition Act to reflect the Program’s                implemented on October 1, 2008, via an
                                                      the requirement to notify households
                                                                                                              name change from the Food Stamp                       FNS implementation memo, but would
                                                      when benefits are taken off-line. Finally,
                                                                                                              Program to the Supplemental Nutrition                 be codified with this proposed rule. The
                                                      FNS is updating SNAP definitions in 7
                                                                                                              Assistance Program (SNAP), and section                discussion below and the subsequent
                                                      CFR part 271, to reflect the Program’s
                                                                                                              4115 de-obligated coupons as of June                  regulatory language for this part provide
                                                      new name and the issuance of benefits
                                                                                                              18, 2009, and made EBT cards the sole                 additional details to address operational
                                                      through Electronic Benefit Transfer
                                                                                                              method of benefit delivery.                           processes and/or clarify current policy.
                                                      (EBT) systems.                                             This rulemaking proposes to                        Where FNS is also proposing changes to
                                                      DATES: Written comments must be                         implement the 2008 Farm Bill                          current processes, it is so noted.
                                                      received on or before November 28,                      amendments to the Food and Nutrition
asabaliauskas on DSK3SPTVN1PROD with PROPOSALS




                                                      2016 to be assured of consideration.                    Act, and to update the general                        Split Issuance
                                                      ADDRESSES: The Food and Nutrition                       information and definitions of 7 CFR                     Prior to the 2008 Farm Bill, some
                                                      Service, USDA, invites interested                       part 271 to reflect the Program’s new                 State agencies had received strong
                                                      persons to submit comments on this                      name and issuance of benefits through                 interest from stakeholders to divide
                                                      proposed rule. Comments may be                          EBT systems. The elimination of all                   each individual household’s monthly
                                                      submitted by one of the following                       other benefit delivery options was                    allotment into two or more issuances
                                                      methods:                                                addressed in the ‘‘Regulation                         over the month. Up to that point, no
                                                        • Federal e-Rulemaking Portal: Go to                  Restructuring: Issuance Regulation                    State had ever split households’ benefit
                                                      http://www.regulations.gov. Preferred                   Update and Reorganization to Reflect                  allotments. While not explicitly


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                                                                         Federal Register / Vol. 81, No. 189 / Thursday, September 29, 2016 / Proposed Rules                                         66867

                                                      prohibiting splitting the issuance of                   general, the prohibition against splitting               Section 7(h)(12)(C) of the Food and
                                                      monthly allotments, the current SNAP                    ongoing monthly issuances is not                      Nutrition Act reads, ‘‘A State agency
                                                      regulations are based on a one-time                     intended to change policy or practice                 shall expunge benefits that have not
                                                      issuance per month for ongoing benefits                 with respect to the issuance of benefits              been accessed by a household after a
                                                      with 7 CFR 274.2(d) stating that ‘‘all                  in any other area, including expedited                period of 12 months.’’ This language
                                                      households shall be placed on an                        benefits, the proration of benefits for               could be interpreted to support SNAP’s
                                                      issuance schedule so that they receive                  partial months, the issuance of                       current expungement policy
                                                      their benefits on or about the same date                supplemental benefits in the event a                  (interpretation #1) of only expunging
                                                      each month.’’                                           benefit correction is necessary, or the               benefits from EBT accounts that have
                                                         The purpose of splitting benefit                     option to issue benefits semimonthly to               not been accessed in 12 months (i.e.,
                                                      allotments, according to retail industry                residents of drug or alcohol addiction                inactive accounts). This interpretation
                                                      proponents, would be to help                            treatment facilities.                                 focuses on the account referenced in
                                                      authorized SNAP stores better manage                       This provision would be codified at 7              section 7(h)(12)(A) of the statute, which
                                                      their food stock, employee hours and                    CFR 274.2(c).                                         requires State agencies to establish a
                                                      traffic flow. Proponents have also                                                                            procedure for recovering electronic
                                                                                                              Benefit Expungement
                                                      suggested that it would ensure that                                                                           benefits from the account of a
                                                      SNAP participants spread their benefit                     Under the previous food stamp                      household due to inactivity. Another
                                                      spending over the course of the month                   coupon issuance system, paper coupons                 interpretation (interpretation #2) could
                                                      instead of depleting the entire allotment               did not have an expiration date.                      be that benefits that have not been used
                                                      early on and not having sufficient funds                Households could accumulate an                        after 12 months must be expunged
                                                      to meet their nutritional needs as the                  unlimited amount of benefits in the                   regardless of whether the household has
                                                      end of the month approaches. However,                   form of paper coupons and spend them                  accessed the account (i.e., regardless of
                                                      section 4113 of the 2008 Farm Bill now                  at any time in the future, until the 2008             account activity).
                                                      requires that State agencies issue a                    Farm Bill de-obligated all food stamp                    Since the 2008 Farm Bill passed, FNS
                                                      household’s ongoing monthly benefit                     coupons as of June 2009. Currently                    has received feedback from some States
                                                      allotment in one lump sum. Proponents                   under EBT, consistent with section 4115               in support of the second interpretation.
                                                      of the one issuance per month limitation                of the 2008 Farm Bill, benefits are                   This support emphasizes that SNAP
                                                      have argued that requiring the entire                   expunged (permanently removed) from                   households should be prevented from
                                                      monthly benefit allotment to be issued                  inactive accounts if the account has                  accumulating excessively high balances
                                                      at one time allows households to make                   been inactive for one year. Current                   in their SNAP EBT accounts. High
                                                      large buying trips and to purchase large,               policy considers an account active if the             balances, some States have indicated, do
                                                      economy-size containers of staple foods.                household initiates an action that affects            not align with the true intent of the
                                                      It also allows households with small                    the balance of the account, such as a                 program, and hold taxpayer money
                                                      benefit amounts—such as seniors or                      purchase or refund, at least once every               inactive that could otherwise be spent
                                                      those with limited transportation                       12 months. As long as the account is                  in a beneficial way. As a result, FNS is
                                                      options—to make one shopping trip                       active, States are not allowed to                     requesting comments through this
                                                      during the month.                                       expunge any benefits even if there are                proposed rulemaking to obtain further
                                                         To address retailer concerns regarding               benefits in the account that were issued              feedback from State agencies as well as
                                                      monthly spikes in traffic flow, State                   more than 12 months ago. Only when                    other stakeholders, such as advocates
                                                      agencies have the option to stagger the                 the account has been inactive for 12                  and EBT processors, regarding the
                                                      issuance of benefits to individual                      months, may State agencies begin to                   possibility of changing the current
                                                      households over multiple days of the                    permanently remove benefits from a                    expungement process to reflect a
                                                      month in accordance with 7 CFR                          household’s account at the benefit                    process in line with interpretation #2.
                                                      274.2(d)(1). Staggered issuance, in this                allotment level. This policy and                         Under interpretation #2, FNS is
                                                      context, means issuing benefits to a                    approach to expungement was in place                  particularly interested in receiving
                                                      group of SNAP recipients on one date of                 through regulations prior to the 2008                 comments on how to address a scenario
                                                      a month, and issuing benefits to another                Farm Bill.                                            in which a household receives restored
                                                      group of recipients on a different date of                 The 2008 Farm Bill requires State                  benefits for multiple months in one
                                                      the month, and so on, so that all SNAP                  agencies to establish a procedure for                 lump sum as a result of a fair hearing
                                                      recipients in the State are not receiving               recovering electronic benefits from a                 finding. This is one possible reason a
                                                      their monthly allotment and shopping                    household’s account due to inactivity                 household might have a large SNAP
                                                      on the same day. Staggered issuance                     and to expunge benefits that have not                 balance. FNS understands that, in these
                                                      allows authorized SNAP stores to                        been accessed by a household after a                  types of situations, a household would
                                                      manage better their food stock,                         period of 12 months. Because                          have a shorter period of time overall to
                                                      employee hours and traffic flow, while                  expungement has been a regulatory                     spend the restored benefits they were
                                                      still allowing recipients to make bulk                  requirement since the beginning of EBT                entitled to receive for previous months
                                                      purchases and/or limit their shopping                   implementation, all State agencies                    than would have been the case if the
                                                      trips to once per month. When a State                   already have a process in place for                   benefits were provided monthly as
                                                      agency changes its issuance schedule to                 expunging benefits from a household’s                 originally required. The restored
                                                      institute or expand a staggered issuance                EBT account due to inactivity.                        benefits would be in addition to any
asabaliauskas on DSK3SPTVN1PROD with PROPOSALS




                                                      schedule, State agencies would continue                 Furthermore, the 2008 Farm Bill                       ongoing benefits the household is
                                                      to have the option to divide the                        implementation memo issued on July 3,                 receiving, which must also be spent
                                                      issuances into two parts during the                     2008, maintained the current                          within 12 months. However, FNS is also
                                                      transition month to meet the                            expungement process outlined in the                   sensitive to the automated system
                                                      requirement that no more than 40 days                   previous paragraph. However, after                    processes that would be impacted if it
                                                      elapses between the issuance of any two                 further review of the statutory language,             instituted exceptions to a requirement
                                                      allotments provided to a household                      FNS has determined that there is                      that State agencies expunge unused
                                                      participating longer than two                           sufficient ambiguity in the language to               benefits 12 months after they were
                                                      consecutive, complete months. In                        allow for two different interpretations.              issued.


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                                                      66868              Federal Register / Vol. 81, No. 189 / Thursday, September 29, 2016 / Proposed Rules

                                                         In addition to comments on each of                     Furthermore, to ensure that benefits                implementing memo, this provision was
                                                      the two expungement policy                              are not available to the household                    implemented on October 1, 2008.
                                                      interpretations, FNS is also interested in              longer than allowed by statute, FNS is                   Because ‘‘off-line’’ was not previously
                                                      receiving comments on whether every                     proposing to require State agencies to                defined in regulations, FNS is taking
                                                      State agency should be given the option                 expunge benefits from the EBT system                  this opportunity to propose such a
                                                      to choose one of the two expungement                    or, if offline, from the State records on             definition. The off-line definition would
                                                      processes discussed here. Therefore,                    a daily basis.                                        not impact a client’s ability to get
                                                      both expungement processes (i.e.                          This proposed rule also clarifies that              benefits reinstated, or the timeframes.
                                                      expunging unused benefits after one                     the expungement timeframe                             The definition serves only to provide
                                                      year of account inactivity or expunging                 requirement would not apply to cases                  State agencies and EBT processors the
                                                      unused benefits one year after each                     that have been closed due to the death                parameters for operationalizing the off-
                                                      allotment is issued) would be allowed,                  of all household members. In most                     line provision. FNS welcomes
                                                      giving each State agency the flexibility                cases, this provision would apply to                  comments regarding the impact this
                                                      to choose which process to implement.                   one-person households. Once the State                 definition would have on State agencies’
                                                         Respondents who support the second                   agency has confirmed a death match                    EBT issuance systems.
                                                      alternative (i.e. expunging unused                      and closed the case in accordance with                   Going forward, taking benefits ‘‘off-
                                                      benefits one year after each allotment is               7 CFR 272.14, there is no one left in the             line’’ would mean that the benefits are
                                                      issued), either as mandatory or as an                   household who is entitled to the                      being removed from the EBT account
                                                      option, should also provide comments                    benefits. In such cases, State agencies               and the EBT system. Moreover, this
                                                      regarding household notification of the                 would be required to permanently                      regulation proposes that, when taking
                                                      new expungement policy and suggested                    expunge all SNAP benefits in the                      benefits off-line, from a financial
                                                      effective dates. For example, would an                  household’s account regardless of when                management perspective, the EBT
                                                      effective date of one year after the final              the benefits were issued or last used.                contractor treat these benefits like
                                                      rule’s publication date be a suitable                   This provision would prevent                          expungements by removing benefits
                                                      timeframe for providing notice to clients               unauthorized persons from accessing                   from the Account Management Agent
                                                      that unused benefits over 12 months old                 and using benefits that remain in a                   (AMA). The AMA is an accounting
                                                      will be permanently expunged or                         deceased household’s account. For all                 system that interfaces with the U.S.
                                                      should the timeframe be longer or                       other SNAP cases, benefits would                      Department of Treasury to keep track of
                                                      shorter and why?                                        continue to remain in the SNAP account                benefit authorizations, returned benefits
                                                         To summarize: Under interpretation                   even after the SNAP case is closed                    such as expungements, and benefit
                                                      #1, SNAP benefits would only be                         (unless taken off-line due to inactivity              redemptions. However, unlike a
                                                      expunged if the account has been                        as discussed below) until the benefits                permanent expungement, information
                                                      inactive for 12 months. As long as the                  have aged off in accordance with                      about the benefits (amount, availability
                                                      account is active, no benefits would be                 expungement requirements.                             date, last used date, etc.) would be
                                                      expunged regardless of when the                           This provision would be codified at 7               stored elsewhere so that the benefits can
                                                      benefits were issued, and benefits could                CFR 274.2(h)(2).                                      be reissued upon timely contact by the
                                                      continue to accumulate as long as the                                                                         household.
                                                                                                              Moving Benefits Off-Line                                 The law does not allow State agencies
                                                      household remains eligible for benefits.
                                                      Under interpretation #2, households                        Prior to the 2008 Farm Bill, EBT                   to make SNAP benefits in an inactive
                                                      would have 12 months from the date of                   regulations allowed State agencies to                 EBT account inaccessible to a client
                                                      issuance to spend each benefit allotment                move all benefits in an inactive SNAP                 prior to expungement, unless they
                                                      they receive even if the household is                   account off-line if the account had not               exercise the option to store benefits off-
                                                      accessing the account and using                         been accessed over a three-month                      line within the permitted timeframes.
                                                      benefits.                                               period. Once benefits are taken off-line,             Therefore, under the proposed
                                                         In this proposed rule, the proposed                  they are no longer immediately                        definition of ‘‘off-line’’, State agencies
                                                      regulatory language is in line with the                 accessible to the household, but must be              would no longer be able to flag an
                                                      2008 Farm Bill Implementation Memo,                     reinstated if the household reapplies for             account as ‘‘dormant’’ or otherwise
                                                      which mirrored current policy of                        the program or requests that the                      deactivate the account to make benefits
                                                      expunging benefits only from inactive                   remaining benefits be moved back on-                  inaccessible to the client, and yet keep
                                                      EBT accounts. Final language will take                  line prior to expungement. However,                   the benefits on-line. FNS is proposing
                                                      into consideration the comments                         some households, especially seniors                   this limitation because such a practice
                                                      received regarding both possible                        who qualify for a small amount of                     would defeat the logic of the original
                                                      expungement interpretations discussed                   benefits, have been known to save up                  regulation that permitted benefits to be
                                                      above.                                                  those smaller amounts and use several                 moved off-line. When the original
                                                         This rulemaking also proposes to                     months’ worth in one shopping trip. For               regulation to allow State agencies to
                                                      codify the current policy of requiring                  these households, three months may                    take benefits off-line was implemented,
                                                      State agencies to expunge benefits at the               have been too short a period before                   the increased computer system capacity
                                                      benefit allotment level. In other words,                moving benefits off-line. As a result,                needed to maintain all EBT accounts on-
                                                      the entire balance of a SNAP EBT                        section 4114 of the 2008 Farm Bill                    line was more expensive than it is now.
                                                      account could not be permanently                        stipulated 6 months as the time period                By taking inactive EBT accounts off-
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                                                      removed due to inactivity if there are                  that an EBT account must be inactive                  line, the goal was to reduce the overall
                                                      benefit allotments that have not been                   before a State agency may move benefits               cost of EBT services. The incremental
                                                      available to the household for at least 12              off-line. State agencies are not required             cost of additional system capacity,
                                                      months. Instead, the State would need                   to take inactive benefits off-line at all             however, is now considerably less
                                                      to wait 12 months from the date when                    prior to expungement, but if a State                  expensive. Therefore, the financial
                                                      each benefit allotment was issued to the                agency wishes to exercise the option to               motives for moving benefits off-line are
                                                      household or from the last date of                      do so, it must wait until an EBT account              no longer a significant factor.
                                                      account activity, whichever date is later,              has been inactive for at least 6 months.              Nevertheless, some State agencies are
                                                      before expunging those particular funds.                In accordance with the July 3, 2008,                  choosing to make benefits inaccessible


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                                                                         Federal Register / Vol. 81, No. 189 / Thursday, September 29, 2016 / Proposed Rules                                         66869

                                                      after a period of inactivity in order to                reinstated, the benefit aging process                 statement is needed for a rule, section
                                                      establish contact with the household                    must start over so that the household                 205 of the UMRA generally requires the
                                                      and verify continued eligibility. FNS                   has another six months to access the                  Department to identify and consider a
                                                      believes this is contrary to the intent of              account before the reinstated benefits                reasonable number of regulatory
                                                      the law. Therefore, as noted above, this                are taken off-line again, and another 12              alternatives and adopt the least costly,
                                                      rule would no longer permit the practice                months to access the account before                   more cost-effective or least burdensome
                                                      of simply making benefits inaccessible                  those benefits are expunged due to                    alternative that achieves the objectives
                                                      without actually moving them off-line.                  inactivity.                                           of the rule.
                                                      Furthermore, by taking the benefits out                   This provision would be codified at 7                  This proposed rule does not contain
                                                      of the EBT system, this provision would                 CFR 274.2(h)(1).                                      Federal mandates (under the regulatory
                                                      provide additional system security by                                                                         provisions of Title II of the UMRA) that
                                                                                                              Procedural Matters
                                                      preventing unauthorized persons from                                                                          impose costs on State, local, or tribal
                                                      accessing and using accumulated                         Executive Order 12866 and Executive                   governments or to the private sector of
                                                      benefits that remain dormant in a                       Order 13563                                           $100 million or more in any one year.
                                                      household’s account. State agencies                        Executive Orders 12866 and 13563,                  This proposed rule is, therefore, not
                                                      would still be able to flag a household’s               direct agencies to assess all costs and               subject to the requirements of sections
                                                      EBT account at various stages of                        benefits of available regulatory                      202 and 205 of the UMRA.
                                                      inactivity for monitoring purposes, but                 alternatives and, if regulation is                    Executive Order 12372
                                                      the benefits would need to remain                       necessary, to select regulatory
                                                      accessible to the household unless                      approaches that maximize net benefits                   SNAP is listed in the Catalog of
                                                      moved off-line or permanently                           (including potential economic,                        Federal Domestic Assistance under No.
                                                      expunged.                                               environmental, public health and safety               10.551. For the reasons set forth in 2
                                                         Section 4114 of the 2008 Farm Bill                   effects, distributive impacts, and                    CFR chapter IV, this Program is
                                                      also requires State agencies to send a                  equity). Executive Order 13563                        excluded from the scope of Executive
                                                      notice to the household when the                        emphasizes the importance of                          Order 12372, which requires
                                                      household’s benefits are taken off-line                 quantifying both costs and benefits, of               intergovernmental consultation with
                                                      and to make the benefits available again                reducing costs, of harmonizing rules                  state and local officials.
                                                      within 48 hours of the household’s                      and of promoting flexibility. This                    Executive Order 13132
                                                      request. The Congressional intent, as                   proposed rule has been determined to
                                                      stipulated in the Congressional record,                                                                         Executive Order 13132, requires
                                                                                                              be not significant and was not reviewed
                                                      was that notification be closely tied to                                                                      Federal agencies to consider the impact
                                                                                                              by the Office of Management and
                                                      the date benefits would move off-line.                  Budget (OMB) in conformance with                      of their regulatory actions on State and
                                                      Therefore, this rule proposes in                        Executive Order 12866.                                local governments. Where such actions
                                                      273.2(h)(1) to allow States to choose                                                                         have federalism implications, agencies
                                                      when to provide notification as long as                 Regulatory Impact Analysis                            are directed to provide a statement for
                                                      it is within 10 days prior to or                          This proposed rule has been                         inclusion in the preamble to the
                                                      concurrent with moving benefits off-                    designated as not significant by the                  regulations describing the agency’s
                                                      line. Although not required, some State                 Office of Management and Budget,                      considerations in terms of the three
                                                      agencies may want to give clients                       therefore, no Regulatory Impact                       categories called for under section
                                                      sufficient notice to access the account to              Analysis is required.                                 (6)(b)(2)(B) of Executive Order 13132.
                                                      prevent benefits from being taken off-                                                                        FNS has considered the impact of this
                                                      line altogether. Because individual off-                Regulatory Flexibility Act                            proposed rule on State and local
                                                      line notification is now a statutory                      The Regulatory Flexibility Act (5                   governments and has determined that
                                                      requirement, State agencies may no                      U.S.C. 601–612) requires Agencies to                  this rulemaking does not have
                                                      longer receive a waiver to provide                      analyze the impact of rulemaking on                   federalism implications. This proposed
                                                      general off-line notification as part of                small entities and consider alternatives              rule does not impose substantial or
                                                      initial training or recertification.                    that would minimize any significant                   direct compliance costs on State and
                                                      Inactive accounts with a zero balance                   impacts on a substantial number of                    local governments. Therefore, under
                                                      that are taken off-line do not require a                small entities. Pursuant to that review,              section 6(b) of the Executive Order, a
                                                      notice because no actual benefits are                   this rule is certified not to have a                  federalism summary impact statement is
                                                      made inaccessible to the household.                     significant impact on a substantial                   not required.
                                                         As already required at 7 CFR                         number of small entities.
                                                                                                                                                                    Executive Order 12988
                                                      274.2(h)(1), the notice must describe the
                                                                                                              Unfunded Mandates Reform Act                            This proposed rule has been reviewed
                                                      steps necessary to bring the recovered
                                                      benefits back on-line. State agencies                     Title II of the Unfunded Mandates                   under Executive Order 12988, Civil
                                                      should make the process for reinstating                 Reform Act of 1995 (UMRA), Public                     Justice Reform. This proposed rule is
                                                      off-line benefits simple for households.                Law 104–4, establishes requirements for               intended to have preemptive effect with
                                                      A general request for assistance from a                 Federal agencies to assess the effects of             respect to any State or local laws,
                                                      household that has had benefits moved                   their regulatory actions on State, local              regulations or policies which conflict
                                                      off-line should be considered a request                 and Tribal governments and the private                with its provisions or which would
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                                                      for reinstatement of benefits. In other                 sector. Under section 202 of the UMRA,                otherwise impede its full
                                                      words, households should not have to                    the Department generally must prepare                 implementation. This proposed rule is
                                                      follow a complicated reinstatement                      a written statement, including a cost/                not intended to have retroactive effect
                                                      option in order to get benefits restored                benefit analysis, for proposed and final              unless specified in the DATES section of
                                                      to their accounts. Rather, eligibility                  rules with Federal mandates that may                  the final rule. Prior to any judicial
                                                      workers and local office or call center                 result in expenditures to State, local, or            challenge to the provisions of this rule
                                                      employees should assist households in                   Tribal governments, in the aggregate, or              or the application of its provisions, all
                                                      initiating the process for reinstating                  to the private sector, of $100 million or             applicable administrative procedures
                                                      benefits. Once the benefits are                         more in any one year. When such a                     must be exhausted.


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                                                      66870              Federal Register / Vol. 81, No. 189 / Thursday, September 29, 2016 / Proposed Rules

                                                      Executive Order 13175                                   they can be implemented. Respondents                  ■  c. Add definitions for Benefit and
                                                         Executive Order 13175, requires                      are not required to respond to any                    Benefit issuer in alphabetical order;
                                                                                                              collection of information unless it                   ■ d. Remove the definition of Bulk
                                                      Federal agencies to consult and
                                                                                                              displays a current valid OMB control                  storage point;
                                                      coordinate with tribes on a government-                                                                       ■ e. Add a definition for Contractor (or
                                                      to-government basis on policies that                    number. This proposed rule does not
                                                                                                              contain information collection                        Contracted vendor) in alphabetical
                                                      have tribal implications, including                                                                           order;
                                                      regulations, legislative comments or                    requirements subject to approval by
                                                                                                              OMB under the Paperwork Reduction                     ■ f. Remove the definitions of Coupon
                                                      proposed legislation, and other policy                                                                        issuer and Direct access system;
                                                      statements or actions that have                         Act of 1995.
                                                                                                                                                                    ■ g. Revise the definition of Drug
                                                      substantial direct effects on one or more               E-Government Act Compliance                           addiction or alcoholic treatment and
                                                      Indian tribes, on the relationship                                                                            rehabilitation program;
                                                                                                                The Food and Nutrition Service is
                                                      between the Federal Government and                                                                            ■ h. Add definitions for Electronic
                                                                                                              committed to complying with the
                                                      Indian tribes, or on the distribution of                                                                      Benefit Transfer (EBT) account,
                                                                                                              E-Government Act, to promote the use
                                                      power and responsibilities between the                                                                        Electronic Benefit Transfer (EBT) card,
                                                                                                              of the Internet and other information
                                                      Federal Government and Indian tribes.                                                                         and Electronic Benefit Transfer (EBT)
                                                                                                              technologies to provide increased
                                                      In late 2010 and early 2011, USDA                                                                             system in alphabetical order;
                                                                                                              opportunities for citizen access to
                                                      engaged in a series of consultative                                                                           ■ i. Amend the definition of Eligible
                                                                                                              Government information and services,
                                                      sessions to obtain input by tribal                                                                            foods by removing the word ‘‘coupons’’
                                                                                                              and for other purposes.
                                                      officials or their designees concerning                                                                       where it appears twice in paragraph (3)
                                                      the impact of this rulemaking on the                    List of Subjects in 7 Parts 271 and 274               of the definition, and adding in its place
                                                      tribe or Indian tribal governments, or                    Food stamps, Grant programs—social                  the words ‘‘SNAP benefits’’;
                                                      whether this rulemaking may preempt                                                                           ■ j. Amend the definition of
                                                                                                              programs, Reporting and recordkeeping
                                                      tribal law. USDA did not receive any                    requirements.                                         Employment and training (E&T)
                                                      comments specific to this proposed rule                                                                       component by removing ‘‘6(d)(4)(B)(iv)’’
                                                                                                                For reason set forth in the preamble,               and adding in its place ‘‘6(d)(4)(B)’’ and
                                                      during the sessions. Reports from the
                                                                                                              7 CFR parts 271 and 274 are proposed                  by removing ‘‘(7 U.S.C. 2014(2)(4)(B))’’
                                                      consultative sessions were made part of
                                                                                                              to be amended as follows:                             and adding in its place ‘‘(7 U.S.C.
                                                      the USDA annual reporting on Tribal
                                                      Consultation and Collaboration. USDA                    SUBCHAPTER C—[AMENDED]                                2015(d)(4)(B))’’;
                                                      offers consultation opportunities, such                                                                       ■ k. Amend the definition of
                                                                                                              ■ 1. In the heading of subchapter C of
                                                      as webinars and teleconferences, for                    chapter II, remove the words ‘‘Food                   Employment and training (E&T)
                                                      collaborative conversations with tribal                 Stamp’’ and add in their place the                    mandatory participant by removing ‘‘7
                                                      leaders and their representatives                       words ‘‘Supplemental Nutrition                        U.S.C. 2014(d)(1)’’ and adding in its
                                                      concerning ways to improve rules with                   Assistance’’.                                         place ‘‘7 U.S.C. 2015(d)(1)’’;
                                                      regard to their effect on Indian country                                                                      ■ l. Amend the definition of Firm’s
                                                                                                              ■ 2. The authority citation for 7 CFR
                                                      on a quarterly basis as part of its yearly              parts 271 and 274 continues to read as                practice by removing the words ‘‘food
                                                      tribal consultation schedule.                           follows:                                              coupons’’ and adding in their place the
                                                         We are unaware of any current tribal                                                                       words ‘‘SNAP benefits’’;
                                                                                                                  Authority: 7 U.S.C. 2011–2036.                    ■ m. Add a definition for Food and
                                                      laws that could be in conflict with the
                                                      proposed rule. We request that                                                                                Nutrition Act of 2008 (Food and
                                                                                                              PART 271—GENERAL INFORMATION                          Nutrition Act) in alphabetical order;
                                                      commenters address any concerns in                      AND DEFINITIONS                                       ■ n. Revise the definition of Food Stamp
                                                      this regard in their responses.
                                                                                                              § 271.1   General purpose and scope.                  Act;
                                                      Civil Rights Impact Analysis                                                                                  ■ o. Amend the definition of
                                                                                                              ■ 3. In § 271.1:
                                                         FNS has reviewed this rule in                                                                              Identification (ID) card by removing the
                                                                                                              ■ a. Revise paragraph (a);
                                                      accordance with Departmental                                                                                  words ‘‘food coupons’’ and adding in its
                                                                                                              ■ b. Remove the word ‘‘coupons’’ from
                                                      Regulations 4300–4, ‘‘Civil Rights                                                                            place the words ‘‘SNAP benefits’’;
                                                                                                              the fourth sentence of paragraph (b) and
                                                                                                                                                                    ■ p. Add definitions for Interoperability,
                                                      Impact Analysis,’’ and 1512–1,                          add in its place ‘‘SNAP benefits’’; and
                                                                                                                                                                    Manual transaction, and Manual
                                                      ‘‘Regulatory Decision Making                            ■ c. Remove the word ‘‘coupon’’ from
                                                                                                                                                                    voucher in alphabetical order;
                                                      Requirements.’’ After a careful review of               the tenth sentence of paragraph (b) and               ■ q. Amend the definition of
                                                      the rule’s intent and provisions, FNS                   add in its place ‘‘benefit’’.                         Overissuance by removing the word
                                                      has determined that this proposed rule                    The revision reads as follows:                      ‘‘coupons’’ and adding in its place the
                                                      will not in any way limit or reduce the
                                                                                                              § 271.1   General purpose and scope.                  word ‘‘benefits’’;
                                                      ability of protected classes of                                                                               ■ r. Add definitions for Personal
                                                      individuals to receive SNAP benefits on                   (a) Purpose of SNAP. In accordance
                                                                                                              with section 2 of the Food and Nutrition              identification number (PIN), Point-of-
                                                      the basis of their race, color, national                                                                      sale (POS) terminal, and Primary
                                                      origin, sex, age, disability, religion or               Act of 2008, SNAP is designed to
                                                                                                              promote the general welfare and to                    account number (PAN) in alphabetical
                                                      political belief nor will it have a                                                                           order;
                                                      differential impact on minority owned                   safeguard the health and well being of
                                                                                                                                                                    ■ s. Remove the definition of Program;
                                                      or operated business establishments,                    the Nation’s population by raising the
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                                                                                                                                                                    ■ t. Add definitions for Retailer EBT
                                                      and woman owned or operated business                    levels of nutrition among low-income                  Data Exchange (REDE) system and
                                                      establishments that participate in SNAP.                households.                                           Supplemental Nutrition Assistance
                                                                                                              *     *     *     *    *                              Program (SNAP or Program) in
                                                      Paperwork Reduction Act
                                                                                                              ■ 4. In § 271.2:                                      alphabetical order.
                                                        The Paperwork Reduction Act of 1995                   ■ a. Amend the definition of Allotment                   The additions and revisions read as
                                                      (44 U.S.C. chap. 35; see 5 CFR 1320)                    by removing the word ‘‘coupons’’ and                  follows:
                                                      requires the Office of Management and                   adding in its place the word ‘‘benefits’’;
                                                      Budget (OMB) approve all collections of                 ■ b. Remove the definition of                         § 271.2      Definitions.
                                                      information by a Federal agency before                  Authorization to participate card (ATP);              *        *      *     *     *


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                                                                         Federal Register / Vol. 81, No. 189 / Thursday, September 29, 2016 / Proposed Rules                                               66871

                                                         Benefit means the value of                           through 2036 (7 U.S.C. 2011–2036),                    ■  c. Amend the introductory text of
                                                      supplemental nutrition assistance                       including any subsequent amendments                   paragraph (b) by removing the word
                                                      provided to a household by means of an                  thereto.                                              ‘‘ATP’’ and adding in its place the word
                                                      EBT system or other means of providing                     Food Stamp Act means the Food                      ‘‘EBT’’;
                                                      assistance, as determined by the                        Stamp Act of 1977 (Pub. L. 95–113) as                 ■ d. Remove paragraphs (b)(1) through
                                                      Secretary.                                              amended through Public Law 108–269,                   (3); and
                                                         Benefit issuer means any office of the               July 2, 2004.                                         ■ e. Amend paragraph (c) by removing
                                                      State agency or any person, partnership,                *      *     *     *     *                            the word ‘‘ATP’s’’ wherever they appear
                                                      corporation, organization, political                       Interoperability means a system that               and adding in its place the words ‘‘EBT
                                                      subdivision or other entity with which                  enables program benefits issued via an                cards’’.
                                                      a State agency has contracted for, or to                EBT card to be redeemed outside the
                                                      which it has delegated functional                       State that issued the benefits.                       PART 274—ISSUANCE AND USE OF
                                                      responsibility, in connection with the                  *      *     *     *     *                            BENEFITS
                                                      issuance of benefits to households.                        Manual transaction means an EBT                    ■ 7. In § 274.2:
                                                      *      *     *     *     *                              transaction that is processed with the                ■ a. Revise paragraph (c);
                                                         Contractor (or contracted vendor)                    use of a paper manual voucher when                    ■ b. Amend paragraph (e)(1) by
                                                      means an entity that is selected to                     there is an EBT system outage.                        removing the words ‘‘of paragraphs (e)
                                                      perform EBT-related services for the                       Manual voucher means a paper                       through (h)’’;
                                                      State agency.                                           document signed by the EBT cardholder                 ■ c. Amend paragraph (g)(3) by
                                                      *      *     *     *     *                              that allows a retailer to redeem benefits             removing the words ‘‘paragraph (h)(3)’’
                                                         Drug addiction or alcoholic treatment                through a manual transaction.                         and adding the words ‘‘paragraph (i)’’;
                                                      and rehabilitation program means any                       Personal Identification Number (PIN)
                                                                                                                                                                    ■ d. Revise paragraph (h);
                                                      drug addiction or alcoholic treatment                   means a numeric code selected by or
                                                                                                                                                                    ■ e. Add paragraph (i).
                                                      and rehabilitation program conducted                    assigned to a household and used to
                                                                                                                                                                      The revisions and additions read as
                                                      by a private, nonprofit organization or                 verify the identity of an EBT cardholder
                                                                                                                                                                    follows:
                                                      institution, or a publicly operated                     when performing an EBT transaction.
                                                      community mental health center and                      *      *     *     *     *                            § 274.2    Providing benefits to participants.
                                                      certified by the requisite State title XIX                 Point-of-Sale (POS) terminal means a               *       *     *    *     *
                                                      Agency as:                                              range of devices deployed at authorized                  (c) Benefit allotments. (1) State
                                                         (1) Receiving funding under part B of                retail food stores for redeeming benefits             agencies shall not issue ongoing
                                                      title XIX of the Public Health Service                  through the use of an EBT card and PIN                monthly benefit allotments to a
                                                      Act (42 U.S.C. 300x et seq.);                           to initiate electronic debits and credits             household in more than one issuance
                                                         (2) Eligible to receive funding under                of household EBT and retailer bank                    during a month except with respect to
                                                      part B of title XIX even if it does not                 accounts.                                             the issuance of benefits to a resident of
                                                      actually receive funding; or                               Primary Account Number (PAN)                       a drug and alcohol treatment and
                                                         (3) Operating to further the purposes                means a number embossed or printed on                 rehabilitation program in accordance
                                                      of part B of title XIX, to provide                      the EBT card and encoded onto the card                with § 273.11(e) of this chapter.
                                                      treatment to drug addicts and or                        to identify the State and EBT account                    (2) For those households which are to
                                                      alcoholics.                                             holder.                                               receive a combined allotment, the State
                                                         Electronic Benefit Transfer (EBT)                    *      *     *     *     *                            agency shall provide the benefits for
                                                      account means a set of records                             Retailer EBT Data Exchange (REDE)                  both months as an aggregate (combined)
                                                      containing demographic, card, benefit,                  system means the FNS system that                      allotment, or as two separate allotments,
                                                      transaction and balance data for an                     allows the automated exchange of                      made available at the same time in
                                                      individual household within the EBT                     authorized retailer demographic data                  accordance with the timeframes
                                                      system that is maintained and managed                   between FNS and the State and/or EBT                  specified in § 273.2 of this chapter.
                                                      by a State or its contractor as part of the             contractor for notification of changes in
                                                                                                                                                                    *       *     *    *     *
                                                      client case record.                                     retailer Program participation.
                                                                                                                                                                       (h) Inactive EBT accounts. An
                                                         Electronic Benefit Transfer (EBT) card               *      *     *     *     *                            inactive EBT account means that the
                                                      means an on-line magnetic stripe card                      Supplemental Nutrition Assistance                  household has not initiated activity that
                                                      or off-line smart card issued to a                      Program (SNAP or Program) means the                   affects the balance of the household’s
                                                      household member or authorized                          program operated pursuant to the Food                 SNAP benefits in the account, such as
                                                      representative through the EBT system                   and Nutrition Act of 2008.                            a purchase or return, for a minimum of
                                                      by a benefit issuer.                                    *      *     *     *     *                            six months.
                                                      *      *     *     *     *                                                                                       (1) Off-line storage. If a household’s
                                                                                                              § 271.4   [Amended]
                                                         Electronic Benefit Transfer (EBT)                                                                          EBT account is inactive for six months
                                                      system means an electronic payments                     ■  5. In § 271.4(a)(2) remove the word
                                                                                                                                                                    or longer, State agencies may elect to
                                                      system under which household benefits                   ‘‘coupons’’ and add in its place ‘‘SNAP
                                                                                                                                                                    store all benefits in that account off-line.
                                                      are issued from and stored in a central                 benefits and EBT cards’’.
                                                                                                                                                                       (i) Off-line benefits are benefits that
                                                      databank, maintained and managed by a                   § 271.5   [Amended]                                   have been removed from the EBT
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                                                      State or its contractor, that uses                      ■  6. In § 271.5:                                     system for storage by the State agency
                                                      electronic funds transfer and point-of-                 ■  a. Remove ‘‘coupon’’ and ‘‘coupons’’               and are no longer accessible to the
                                                      sale technology for the delivery and                    wherever they appear and add in their                 household unless and until the benefits
                                                      control of food and other public                        place ‘‘benefit’’ and ‘‘benefits’’,                   are reinstated upon contact by the
                                                      assistance benefits.                                    respectively, including the section                   household.
                                                      *      *     *     *     *                              heading;                                                 (ii) The State agency shall send
                                                         Food and Nutrition Act of 2008 (Food                 ■ b. Amend paragraph (a) by adding                    written notification to the household up
                                                      and Nutrition Act) means title 7 of the                 ‘‘and EBT cards’’ at the end of the last              to 10 days prior to or concurrent with
                                                      United States Code, sections 2011                       sentence;                                             the action to store benefits off-line and


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                                                      66872              Federal Register / Vol. 81, No. 189 / Thursday, September 29, 2016 / Proposed Rules

                                                      describe the steps necessary to bring the               accordance with paragraph (h) of this                   • Federal eRulemaking Portal: Go to
                                                      benefits back on-line. If an inactive                   section.                                              http://www.regulations.gov. Follow the
                                                      account has a zero balance, a notice to                    (1) Whenever benefits are stored off-              instructions for submitting comments.
                                                      the household is not required.                          line or expunged, the State agency shall                • Fax: 202–493–2251.
                                                         (iii) Benefits stored off-line that have             document the date, amount of the                        • Mail: U.S. Department of
                                                      not reached the 12-month timeframe for                  benefits and storage location in the                  Transportation, Docket Operations, M–
                                                      expungement in accordance with                          household case file.                                  30, West Building Ground Floor, Room
                                                      paragraph (h)(2) of this section shall be                  (2) Issuance reports shall reflect the             W12–140, 1200 New Jersey Avenue SE.,
                                                      reinstated and made available within 48                 adjustment to the State agency issuance               Washington, DC 20590.
                                                      hours of reapplication or contact by the                totals to comply with monthly issuance                  • Hand Delivery: Deliver to Mail
                                                      household.                                              reporting requirements prescribed under               address above between 9 a.m. and 5
                                                         (iv) Off-line benefits shall be removed              § 274.4.                                              p.m., Monday through Friday, except
                                                      from the Account Management Agent                         Dated: September 14, 2016.                          Federal holidays.
                                                      system, making them unavailable to the                  Telora T. Dean,
                                                                                                                                                                      For service information identified in
                                                      household. Upon reinstatement, the                                                                            this NPRM, contact Airbus Defence and
                                                                                                              Acting Administrator, Food and Nutrition
                                                      benefits shall be reissued and the                      Service.
                                                                                                                                                                    Space, Services/Engineering Support,
                                                      account shall be reactivated or a new                                                                         Avenida de Aragón 404, 28022 Madrid,
                                                                                                              [FR Doc. 2016–22860 Filed 9–28–16; 8:45 am]
                                                      account established to resume the                                                                             Spain; telephone +34 91 585 55 84; fax
                                                                                                              BILLING CODE 3410–30–P
                                                      benefit aging process from the new                                                                            +34 91 585 31 27; email
                                                      issuance date.                                                                                                MTA.TechnicalService@Airbus.com.
                                                         (2) Expungement. On a daily basis,                                                                         You may view this referenced service
                                                      the State agency shall expunge benefits                 DEPARTMENT OF TRANSPORTATION                          information at the FAA, Transport
                                                      from accounts that have been inactive                                                                         Airplane Directorate, 1601 Lind Avenue
                                                      for a period of 12 months in accordance                 Federal Aviation Administration                       SW., Renton, WA. For information on
                                                      with the following:                                                                                           the availability of this material at the
                                                         (i) When the oldest benefit allotment                14 CFR Part 39                                        FAA, call 425–227–1221.
                                                      has not been accessed by the household                  [Docket No. FAA–2016–9113; Directorate                Examining the AD Docket
                                                      for 12 months, the State agency shall                   Identifier 2016–NM–042–AD]
                                                      expunge benefits from the EBT account                                                                            You may examine the AD docket on
                                                      or off-line storage at the monthly benefit              RIN 2120–AA64                                         the Internet at http://
                                                      allotment level as each benefit allotment                                                                     www.regulations.gov by searching for
                                                      ages to 12 months since the date of                     Airworthiness Directives; Airbus                      and locating Docket No. FAA–2016–
                                                      issuance or since the last date of                      Defense and Space S.A. (Formerly                      9113; or in person at the Docket
                                                      account activity, whichever date is later.              Known as Construcciones                               Management Facility between 9 a.m.
                                                         (ii) Expunged benefits shall be                      Aeronauticas, S.A.) Airplanes                         and 5 p.m., Monday through Friday,
                                                      removed from the Account Management                                                                           except Federal holidays. The AD docket
                                                                                                              AGENCY: Federal Aviation                              contains this proposed AD, the
                                                      Agent unless already removed as                         Administration (FAA), DOT.
                                                      provided in paragraph (h)(1) of this                                                                          regulatory evaluation, any comments
                                                                                                              ACTION: Notice of proposed rulemaking                 received, and other information. The
                                                      section, and shall not be reinstated.
                                                                                                              (NPRM).                                               street address for the Docket Operations
                                                         (iii) The State agency shall not
                                                      expunge any benefits from active                                                                              office (telephone 800–647–5527) is in
                                                                                                              SUMMARY:   We propose to adopt a new
                                                      accounts even if there are benefit                                                                            the ADDRESSES section. Comments will
                                                                                                              airworthiness directive (AD) for all
                                                      allotments older than 12 months. If at                                                                        be available in the AD docket shortly
                                                                                                              Airbus Defense and Space S.A.
                                                      any time after the expungement process                                                                        after receipt.
                                                                                                              (formerly known as Construcciones
                                                      begins, the household initiates activity                Aeronauticas, S.A.) Model CN–235, CN                  FOR FURTHER INFORMATION CONTACT:
                                                      affecting the balance of the account, the               235–100, CN 235–200, and CN 235–300                   Shahram Daneshmandi, Aerospace
                                                      State shall stop expunging benefits from                airplanes. This proposed AD was                       Engineer, International Branch, ANM–
                                                      the account and start the account aging                 prompted by reports of cracks in certain              116, Transport Airplane Directorate,
                                                      process over again for the remaining                    areas of the rear fuselage. This proposed             FAA, 1601 Lind Avenue SW., Renton,
                                                      benefits.                                               AD would require repetitive borescope                 WA 98057–3356; telephone 425–227–
                                                         (iv) Notwithstanding the paragraph                   and detailed visual inspections of the                1112; fax 425–227–1149.
                                                      (h)(2)(iii) of this section, in instances               rear fuselage lateral beam and its                    SUPPLEMENTARY INFORMATION:
                                                      when the State agency verifies a death                  external area and repair if necessary. We
                                                      match for all certified members of the                                                                        Comments Invited
                                                                                                              are proposing this AD to detect and
                                                      household and closes the SNAP case in                   correct cracks in the rear fuselage lateral             We invite you to send any written
                                                      accordance with § 272.14 of this                        beam and its external area; such                      relevant data, views, or arguments about
                                                      chapter, the State agency shall expunge                 cracking could lead to failure of the                 this proposed AD. Send your comments
                                                      the remaining SNAP balance in the                       affected components, and result in                    to an address listed under the
                                                      household’s EBT account at that time.                   reduced structural integrity of the                   ADDRESSES section. Include ‘‘Docket No.
asabaliauskas on DSK3SPTVN1PROD with PROPOSALS




                                                         (i) Procedures to adjust SNAP                        fuselage.                                             FAA–2016–9113; Directorate Identifier
                                                      accounts. Procedures shall be                                                                                 2016–NM–042–AD’’ at the beginning of
                                                      established to permit the appropriate                   DATES:  We must receive comments on                   your comments. We specifically invite
                                                      managers to adjust SNAP benefits that                   this proposed AD by November 14,                      comments on the overall regulatory,
                                                      have already been posted to an EBT                      2016.                                                 economic, environmental, and energy
                                                      account prior to the household                          ADDRESSES:  You may send comments,                    aspects of this proposed AD. We will
                                                      accessing the account; or to remove                     using the procedures found in 14 CFR                  consider all comments received by the
                                                      benefits from inactive accounts for off-                11.43 and 11.45, by any of the following              closing date and may amend this
                                                      line storage or expungement in                          methods:                                              proposed AD based on those comments.


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Document Created: 2016-09-29 04:13:58
Document Modified: 2016-09-29 04:13:58
CategoryRegulatory Information
CollectionFederal Register
sudoc ClassAE 2.7:
GS 4.107:
AE 2.106:
PublisherOffice of the Federal Register, National Archives and Records Administration
SectionProposed Rules
ActionProposed rule.
DatesWritten comments must be received on or before November 28, 2016 to be assured of consideration.
ContactVicky Robinson, Chief, Retailer Management and Issuance Branch, Retailer Policy and Management, Rm. 418, 3101 Park Center Drive, Alexandria, Virginia 22302, or by phone at 703-305-2476.
FR Citation81 FR 66866 
RIN Number0584-AE02
CFR Citation7 CFR 271
7 CFR 274

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