This section from an actual grocery store receipt I found exemplifies exactly why so many politicians, pundits and civilians display such rage towards those of the public that are receiving benefits from the Government.
Recently I witnessed a customer making a food purchase using EBT card, a State of California benefit card. The card, when used as it is intended, assists those struggling in our society with purchases of food and other necessities. Nothing wrong with that. Sometimes people need a bit of help due to the economy, health or other valid reasons. The card is linked to an account containing funds that is then used to buy groceries and other sundry items can be purchased as long as those items are on an approved list. A few examples of items that can not be purchased using the EBT system are alcohol and hot prepared delicatessen foods. Cold sandwiches can be purchased but hot sandwiches will not process.
Some EBT cards also have a cash option included which is drawn from other benefits and linked to the card. This option allows withdrawals of funds just like if someone was using an ATM and is supposed to be used for those items where an electronic payment is not possible or allowed by the system. Paying for a flat tire to be repaired, a monthly buss pass, phone bill or rent to name a few. What the found receipt displayed here reveals is how easy it is to circumvent the EBT system and use it in ways it was not intended.
What the receipt shows is a misuse of funds and a corruption of the benefits system. The same customer, who had just purchased a cart of food using EBT, then bought a bottle of wine with the same benefits card by selecting the electronic cash option to pay for it. Using State of California assistance benefits this customer purchased a bottle of wine for $9.99 plus tax and also received $20 cash back. After the transaction was completed the customer discarded both receipts onto the floor as they walked away.
It is also noteworthy that the customer refused to use their store loyalty card for the purchase of wine, which would have resulted in a saving of nearly five dollars off the total. In the previous transaction when they purchased food they made a point of using their loyalty card and several coupons. They were demonstrably aware of how to shop wisely and were not unfamiliar with how the EBT system worked or appeared obviously judgmentally impaired in some way.
Not taking advantage of store discounts appears to be a common practice among those receiving public assistance and I’ve observed it too many times to count from my time as a cashier. One can’t help but speculate that if this person’s financial situation was so dire, even if they splurged for once, common sense dictates that stretching the benefits as long as they can would be foremost in their decision making. It is a reality that an emergency could arise before the card is reloaded with more funds at the end of the month. The socially disadvantaged, for many reasons, usually have greater out-of-pocket and up-front expenses. Those with greater resources typically have a buffer for health, transportation and other emergencies than those with a fixed or negative income. It is a simple matter of liquidity.
What is likely is that they fear tracking of their purchases and reporting to an agency by the store . This concern has same basis in fact. I witnessed one incident where a bodega owner who routinely used his entire EBT benefit to purchase sodas to stock the shelves of his business was reported to a fraud hotline. Using his “free money” benefits at the grocery store is probably far less expensive than buying the same amount of stock from authorized soda vendors or the discounts offered in a bulk items store. A few people concerned with the bodega owner purchasing soda in amounts far above what would reasonably considered to be for personal use reported him to the benefits office and shortly after that he stopped visiting the store.
Customers who use their EBT card for purchases of alcohol and other questionable items display little worry that their purchases are recorded and tracked by the card itself, which is alarming. Almost all the customers I’ve observed getting cash or buying items one would not associate with keeping the family healthy appear more worried about tracking at the store level than their case worker. Purchasing habits by any form of payment are regularly recorded and evaluated by stores, manufacturers and advertisers but not by the State of California? One would think that any multimillion dollars program would have a vested interest in ensuring the money is well-spent.
It would be hard if not impossible to completely secure the system. Someone will always try to get over and there will always be loopholes and enablers. Rather than require people who already can’t afford transportation or child care to work in order to receive some benefits, as more than a few politicians are proposing, there are other measures that can minimize the gaming of the system. A simple tweak of a computer program (similar to the one the WIC program enacted a few months ago that halted the purchase of some unhealthier foods and minimize costly errors in processing benefits) could go a long way towards making sure that such fraud and abuse by the recipients of assistance was limited. Regular audits of purchases and spending habits that would alert on questionable purchases or cash withdrawals. If such audits are already being accomplished then they are not being monitored effectively. Sure, such attention will cost but the gains from locking down the probably millions in misspent funds would be worth it.
It is clear the benefits system is broken and it is up to California fix it. But let’s consider: If the system is dysfunctional then someone, somewhere is getting filthy rich off of it being so. Is it the small percentage of taxes from cigarette and alcohol sales that allow such purchases to go under the radar? That is extra cash that the State would not receive otherwise. Is their no info-dump of purchases or audits of EBT accounts being performed even randomly?
A common complaint from retail workers and customers is people using an EBT card to buy party trays, BBQ supplies, liquor and cigarettes. But at a store level there is nothing to be done. This has to be addressed at a State level. Change can be accomplished, much like when benefit cards at Casinos was disallowed a few years ago. When it became embarrassingly public that a large number of people were using their benefit cards at casinos California took steps to halt the practice. It was a simple software fix. The cards won’t work at casinos. When that was disallowed people howled, now forced to either spend their funds on groceries or more likely, seek out other avenues to cash out benefits in order to drop into slot machines.
So come on California. I don’t think anyone would begrudge anyone else a hand now and then, but there is a financial crisis going on. Take some basic steps to ensure benefit recipients buy food, not wine and party supplies.