EBT in Iowa: Better Late Than Never

The state of Iowa is in the final stages of its statewide rollout of debit cards to recipients in the state’s food-stamp program, a year later than an Oct. 1, 2002, deadline mandated for all states in federal legislation passed in 1996. Only California among the 50 states now remains without a statewide electronic food-stamp program, and it expects to have its program finished by late next year. The Iowa program, meanwhile, is not without controversy, as state officials are protesting a fee of 7 cents per transaction the state legislature agreed to pay grocers to accept the food-stamp cards. The fee, which only a handful of states pay merchants for food-stamp card acceptance, is expected to cost Iowa $217,000 this year and $330,000 in 2004, at a time when the state is feeling the pinch of an economic downturn. Roger Munns, spokesman for the state’s Department of Human Services, says the agency plans to ask the legislature to void the fee. “We don’t think we should pay a retailer fee,” he says. “We look at it as a cost of doing business (for the merchants).” Iowa grocers lobbied for the fee as necessary to accept the cards, and argue they should not foot the cost of state transactions. With full implementation, the Iowa program will distribute benefits to 67,000 households accounting for 150,000 individuals; the average monthly benefit is $177. Each household gets one card, which draws on an account funded by the state. The Iowa cards and processing services are provided by Affiliated Computer Services Inc., Dallas, under a six-year contract the company signed with the state late last year. The contract is valued at $2 million annually. The final stages of statewide electronic benefits transfer (EBT) programs comes nearly 20 years after the first EBT pilot in Reading, Pa., and 10 years after the first statewide rollout, in Maryland._x000D_