NEW ORLEANS -- The implementation of nationally standardized electronic benefits transfer programs will allow retailers to tap into a vaster pool of revenues than many industry officials may realize.
"We need to stop thinking of EBT programs as welfare programs. That is a short-sighted approach," said David Bragin, treasurer of Winn-Dixie Stores, Jacksonville, Fla.
"In the future, the federal government will be providing Social Security, government pensions and military pensions, just to name a few of the cash benefits programs, in an EBT operating environment," he said. Bragin spoke at the Food Marketing Institute's MarkeTechnics convention here Feb. 10 to 13. He took part in a workshop session titled, "EBT -- Yesterday, Today and Tomorrow."
Most retailers think of EBT as a more efficient system primarily for providing welfare benefits. But welfare benefits, including food stamps and Aid for Families with Dependent Children, account for only one-third of the total dollars expected to be distributed via EBT card-based programs in the future.
"The federal government has identified 12 [benefits] programs, which total over $111 billion annually, to be delivered in an EBT environment. Of that $111 billion, only $38 billion is for food stamps and Aid for Families with Dependent Children," he said.
Bragin said momentum is growing rapidly at the state and multistate coalition levels in terms of participating in EBT programs.
"Currently, 48 states and two territories are planning to implement EBT systems. By the end of 1996, it is anticipated that EBT will be in 23 states," he said.
"Six state alliances, consisting of 40 states, are in various stages of formation. The private sector has ownership of the national operating rules. The Southern and Northeast alliances should issue cards by the end of calendar year 1996, with nationwide implementation planned for 1999."
Tapping into federal EBT benefits most efficiently, though, from both the retailer and consumer standpoints, requires adopting some form of standardization for processing EBT benefits, he added.
In that regard, a majority of multistate coalitions are forging ahead with EBT II-based programs, which allow consumers to use the same electronic cards even when crossing state lines.
"At this time, we do not know how many states will remain EBT I states or will implement EBT II programs. Two states have expressed interest in changing from an EBT I operating environment to an EBT II program, and 40 states are planning to implement an EBT II program," he said.
The recent decision of Florida to withdraw from the Southern Alliance of States could stall progress of the standardization process. Retailers and other officials are hoping to persuade Florida to reverse its decision.
But even if Florida does not change its decision, "we still hope they will adopt standards so their program is compatible with neighboring states' programs," Bragin said.