FMI, NGA back Senate bill to nix SNAP transaction fees for grocers

FMI-The Food Industry Association (FM) and the National Grocers Association (NGA) are speaking out against fees charged to grocers for Supplemental Nutrition Assistance Program (SNAP) purchases.

FMI and NGA said Friday that they have endorsed the U.S. Senate’s introduction of the Ensuring Fee-Free Benefit Transactions Act (S. 2449), or the EBT Act, brought by Sens. Ben Ray Luján (D., New Mexico) and Peter Welch (D., Vermont), who are members of the Senate Agriculture Committee.

The EBT Act would prevent processing and other related fees to be levied on grocery retailers for electronic benefit transfer (EBT) transactions made via SNAP. In addition, the bill would protect retailers from the financial burden of a migration to EBT chip cards.

“FMI applauds Sens. Luján and Welch for their leadership in introducing the EBT Act to safeguard SNAP participants’ access to grocers in New Mexico, Vermont and across the country,” Jennifer Hatcher, chief public policy officer at FMI, said in a statement. “Tacking on processing or other related fees for SNAP purchases would be an unfair burden on retailers and customers alike and could result in higher costs for both shoppers and grocers. Such fees could also lead to some stores being unable to become or remain SNAP-authorized retail locations, negatively impacting the ability of SNAP participants to shop at their preferred supermarket.”

Through April 2023, more than 41.9 million people and 22.2 million households participated in SNAP nationwide, according to the latest data from the U.S. Department of Agriculture’s Food and Nutrition Service (FNS). Average monthly benefits were $343 per household and $181.72 per person. Over 254,000 retailers are authorized to accept SNAP benefits for purchases, based on FNS’ latest available data.

FMI sent a letter on its EBT Act endorsement to Luján and Welch on Friday. The grocery industry trade group noted that the legislation, introduced in the Senate on Thursday, would help safeguard SNAP benefit recipients’ access to grocery stores.

“Maintaining the integrity of the SNAP program is vitally important to assure millions of Americans are able to access the foods they need to keep their families fed,” Hatcher added. “The EBT Act will ensure that processing or other related fees outside of our control will never be imposed on food retailers or their customers in the SNAP program. We look forward to working with Sens. Luján and Welch to secure passage of the EBT Act to protect the viability of the SNAP program for retailers and their customers in every community.”

FMI also has endorsed a companion bill in the House—the Ensuring Fee-Free Benefit Transactions Act of 2023 (H.R. 4103)—that was introduced on June 14 by Rep. Shontel Brown (D., Ohio).

SNAP cost factor

In announcing its endorsement of the Senate bill, NGA—representing the independent grocery industry—noted that grocers already invest significant resources in software, equipment and training to offer SNAP benefits, and adding EBT processing fees on EBT transactions further squeeze community and family-owned grocers, including those serving urban, rural and high-need market areas.
 
“Independent community grocers play a vital role in ensuring access to healthy and affordable food for families in need through SNAP. These retailers make substantial investments in software, equipment, and training to facilitate SNAP benefits for their communities,” stated NGA president and CEO Greg Ferrara. “NGA is proud to work alongside Senators Luján and Welch to secure a permanent solution that eliminates processing fees on SNAP transactions. This step is crucial in avoiding potential restrictions on SNAP access for beneficiaries and mitigating adverse effects on the indispensable retailers who contribute to the program’s success.” 

A key component of the legislation is ensuring grocery retailers are only responsible for their own costs as the USDA works on modernizing EBT with chip cards and mobile payments, NGA added.
 
“Imposing additional processing fees on retailers through the SNAP program would hamper our ability to fulfill our commitment of serving our local communities to the fullest,” commented Kathy Dominguez of John Brooks Supermarket, a five-store grocer in New Mexico.

Welch and Sen. Kirsten Gillibrand (D., New York) on Thursday also introduced other SNAP legislation in the Senate, the Improving Access to Nutrition Act. The bill would lift the time-limit requirement that SNAP-enrolled, able-bodied adults ages 18 to 49 only  receive SNAP benefits for three months over a 36-month period if they don’t report 20 hours of work per week. The bill would also repeal additional eligibility criteria imposed by House Republicans during the 2023 debt ceiling deal, which would require the three-month rule on adults up to age 54 over the next few years.

Reps. Barbara Lee (D., California) and Alma Adams (D., North Carolina) introduced the Improving Access to Nutrition Act of 2023 (H.R. 1510) in the House in March.