Voices for Children would like to express our support for LB 430 and thank Senator Crawford for bringing forward this bill. As some may recall in 2011, the legislature raised the asset limit in the SNAP program to $25,000 and limited it to liquid resources. Previously, the asset limit included things like educational savings and retirement accounts. This bill would align the policies in the child care subsidy and ADC program with SNAP and has the potential to significantly reduce the amount of paperwork needed to apply for public benefit programs. As the state has switched to a primarily online application program, it also makes sense to modernize program policies in ways that reduce the reliance on paperwork.
We have prepared a quick fact sheet showing some of the asset categories that currently exempt and not exempt under current law. This bill seeks to make the requirements uniform. Under this bill, the income limits for the program remain in place, ensuring that help is still only given to those who need it most. Six states have eliminated assets tests in their TANF programs entirely and Nebraska is one of only two states that has an asset limit in the child care program.
Recent research from the New America Foundation has found improved administrative efficiency in public programs in states where asset tests have been eliminated. The same research also found that the benefits of this efficiency can be limited if policies are not aligned across programs since many states, including Nebraska, use a common application form.
Assets tests can also encourage lower income families to remain outside the financial mainstream, doing things like not holding a bank account. Asset tests also encourage the spending down of resources necessary for longer term financial security, like educational saving and retirement accounts, in order to receive temporary assistance.
In the experience of other state, raising or eliminating the assets limits has not led to an increase in caseloads.
In Ohio and Virginia, who eliminated their TANF asset limits years ago, caseloads decreased in the years following the change. Similarly, in Louisiana, where the asset test in TANF was eliminated in January 2009, there has not been a significant increase in caseload.
LB 430 has the potential to significantly reduce the paperwork required to apply for our public benefit programs and make our public programs more efficient. We urge the committee to advance this bill. Thank you.