More kinds of food stamp fraud would be explicitly subject to state sanctions, under a bill signed privately Monday at the state Capitol by Gov. Scott Walker.
The measure on the state FoodShare program passed the Assembly 73-24 in April and the Senate 28-5 in May, both bipartisan votes.
The move followed stories by the Journal Sentinel and other media looking at the trafficking of FoodShare benefits as well as efforts by state officials to clamp down on the practice. It also takes changes made earlier this year in federal rules on trafficking and puts them into place at the state level
"This bill gives the state additional options to ensure Wisconsin's FoodShare benefits are being properly used by those in need and it aligns state law with federal regulations," Walker said.
The Democrats who did oppose the bill in the Legislature said it was redundant and a distraction from other issues such as the economy.
Walker's administration is now targeting some of the problem areas in FoodShare highlighted in past stories by the Journal Sentinel.
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Authorities don't know how widespread FoodShare fraud is. In looking at some areas of the program, the newspaper found hard evidence of fraud occurring in a small fraction of the cases in the program. With nearly 1.1 million Wisconsin recipients in the 2012 fiscal year with benefits totaling nearly $1.2 billion, even a small amount of impropriety in FoodShare can add up.
In 2011, the newspaper reported on Milwaukee residents who were openly buying or selling FoodShare benefits on social media sites such as Facebook in violation of the law. In more evidence of potential fraud, the newspaper also found in 2011 that nearly 2,000 FoodShare recipients reported losing their Quest cards -- similar to debit cards and used by participants to purchase food -- six or more times in the previous year.
Now, the state is monitoring social media sites for signs of fraud and has sent 1,700 letters to recipients with frequently lost cards to warn them that they cannot sell the benefits on the card for a lesser amount of cash and then report the card stolen.
In 2012, the state identified $6 million in improper overpayments to FoodShare and Medicaid recipients and an additional $8.5 million that would have gone to these recipients in future payments within six months of the fraud being detected, according to state figures.
Federal law prohibits trafficking of food benefits, and rules were revised in March to further expand that definition.
The legislation would provide an explicit prohibition in state law on both buying and selling FoodShare benefits and the food purchased with those benefits.
In a statement, Sen. Alberta Darling (R-River Hills), one of the co-sponsors of the measure, said that it would help ensure that food benefits are available to those who really need them.
"Fraud hurts taxpayers and the people who rely on these benefits. People who follow the rules are being punished by those who break the rules and that must change," Darling said in a statement.
But Democrats such as Rep. JoCasta Zamarripa (D-Milwaukee) have said that the measure is redundant and mean-spirited because it targets low-income recipients.
"It's a bill looking for a problem," Zamarripa said in April.
The bill would not change the state penalties for trafficking. Fraud involving less than $100 would amount to a misdemeanor with up to $1,000 in fines and one year in jail. More than $100 would amount to one of several felonies, depending on the exact dollar amount.
For years, budget cuts under then-Gov. Jim Doyle's administration and lawmakers had led the state to cut funding for fraud investigations even as public benefits programs such as FoodShare swelled and hard economic times gave program participants a greater incentive to bend the rules. Spending by the state to detect fraud dropped to almost nothing, and the cases of fraud detected plummeted along with that.
The Walker administration has restored some of the funding and is now uncovering more overpayments, though what share of the problems are being uncovered remains an open question.
Benefits in the FoodShare program are paid by the federal government. But some of the saving in the program identified by the state and counties goes back to the state, so identifying overpayments can still make financial sense for state taxpayers.
(c)2013 Milwaukee Journal Sentinel
