EBT REPLACES FOOD STAMPS: NEW YORK RETAILERS GET READY

ELIZABETH MORROW / ERIN COWAN

ALBANY, N.Y. (FNS) -- Retailers operating stores in New York state, including Pathmark Stores, Carteret, N.J., Wegmans Food Markets, Rochester, N.Y., and Price Chopper Supermarkets, Schenectady, N.Y., will begin accepting electronic benefits transfers in place of paper food stamp benefits, beginning in January 1999.

This pilot program, which is expected to last through the first quarter of 1999, will be implemented in Staten Island, N.Y., and in three Manhattan zip codes. The New York State Office of Temporary and Disability Assistance here, which established the program, hopes to roll out EBT statewide by 2000.

As the program extends statewide, more than 16,000 food retailers will be authorized to participate in the electronic food stamp program, according to New York State Office of Temporary and Disability Assistance Commissioner Brian Wing. Under the EBT system, the state claims it will promise retailers reimbursement within 24 hours.

Four Pathmark supermarkets in Staten Island and three in Manhattan will participate in the pilot program. "The proposed New York system will be similar to programs in Pennsylvania and New Jersey where we already have stores adopting EBT," said Rich Savner, spokesman for Pathmark.

Wegmans, which operates 57 supermarkets in New York, questioned the compatibility of the EBT program and how it will relate to other programs across the country. "You are going to have a problem if each state has a different system," said Robert Wegman, the retailer's chairman.

"If the system isn't standardized, it is going to be a problem," he added. "Trying to operate different stores in different states with different programs will be almost impossible."

Price Chopper, which operates 94 stores throughout New York, Massachussets, Vermont, Pennsylvania and Connecticut, agreed that a common system would be an asset. "It would be simpler to have one system throughout the country where the electronic equipment would be uniform, and the operation system would be sensitive to it," said Lewis Golub, president and chief executive officer for the Golub Corp., Price Chopper's parent company.

In the pilot, magnetic-strip cards will be issued to recipients in place of paper food coupons. At checkout, recipients swipe the cards through point-of-sale payment terminals used for credit and debit card transactions. Consumers are prompted to enter a personal identification number, which releases funds for qualified items from their EBT account. Retailers who are not equipped with electronic payment systems will be given a manual voucher system, similar to older carbon-copy-based credit card processing systems.

Electronically deducting funds in this manner reduces the possibility of benefits fraud. Paper food stamp vouchers cannot be tracked to ensure that recipients are the ones cashing in the benefits.