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Bill Limits Cash Welfare Recipients Can Withdraw

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ST. PAUL, Minn. (AP) — Republican legislators think they have a way to keep Minnesotans on welfare from spending their benefits on booze, smokes and lottery tickets: They’d keep them from taking more than $20 in benefits in cash per month.

Legislation authored by Sen. Doug Magnus of Slayton and Rep. Kurt Daudt of Crown would prevent people with electronic benefit transfer (EBT) cards from using the cards to withdraw their entitlements from ATMs in cash. Instead, they would be issued a separate card that limited them to withdrawals of no more than $20 cash per month.

The bill would cover families relying on the Minnesota Family Investment Program and childless adults on General Assistance who are generally disabled or otherwise unable to work.

Magnus said he was moved to write the bill by retailers who said they see welfare cardholders withdraw cash and use it to purchase liquor, cigarettes, lottery tickets or even tattoos. He also cited stories by KSTP-TV on welfare waste.

Jessica Webster, an attorney for the Legal Services Advocacy Project, a Minneapolis organization that lobbies the Legislature on behalf of the poor, said the legislation “comes out of a stereotype that there’s broad waste and abuse in the system.” There isn’t, she said.

People on MFIP and General Assistance use cash for a number of things, including rent, child care, public transportation and laundry, and the bill could hurt their ability to care for their families, said Erin Sullivan Sutton, an assistant commissioner in the state Department of Human Services.

“I think there’s a misunderstanding about what these benefits are used for,” Sutton said.

DHS can work to prevent misuse of cards, Sutton said. They can’t track each item purchased on the cards, but they can track where they are used in ATMs and work with retailers to ensure that certain ATMs — in liquor stores or casinos, for example — don’t accept benefit cards. Benefits aren’t supposed to be spent on alcohol or gambling.

Magnus, who said the legislation is a work in progress, pointed out a major loophole in what he hoped to accomplish: People could still choose to take their benefits in the form of a check, which could be turned into cash without any restrictions.

Similar welfare reform proposals have been defeated in years past, but this may stand a better chance of passing the Legislature given the new Republican majorities in both chambers. If it makes it that far, the final decision would rest with Democratic Gov. Mark Dayton. A spokesman said Dayton won’t comment on proposals until they pass at least one chamber.

(© Copyright 2011 The Associated Press. All Rights Reserved. This material may not be published, broadcast, rewritten or redistributed.)

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