Press release from the Tennessee Senate Republican Caucus; January 29, 2013:
(NASHVILLE) — State Senator Jim Tracy (R-Shelbyville) and Representative Terri Lynn Weaver (R-Lancaster) have filed legislation in the Tennessee General Assembly to curb abuse of purchases made through Electronic Benefit Transaction (EBT) cards used by recipients of the Temporary Assistance to Needy Families (TANF) program. Senate Bill 244 prohibits use of a welfare recipient’s EBT card in establishments that primarily sell tobacco products, tattoo facilities, psychic services, adult cabarets, and any establishment open to the public where liquor, wine, beer, or other alcoholic beverages are served for consumption on the premises.
“It is outrageous that these benefit cards, which are meant to help feed families with children in times of desperate need, are reported to have been misused for everything from theatre tickets and a tour of Graceland, to the purchase of alcohol and nightclub entertainment,” said Senator Tracy. “Tennessee law should make it perfectly clear that we will not tolerate this fraudulent use of taxpayer money.”
The legislation comes after a report was released last summer by the Beacon Center of Tennessee, which uncovered numerous examples of abuse by welfare recipients. According to the report, EBT cards were swiped at liquor stores, nightclubs, malls, retail outlets, and adult entertainment establishments, as well as for a hotel stay and UPS services, among others. The Center reported one transaction at a liquor store totaling $790.
“This money is supposed to be used to feed children in struggling families, providing them with essentials until the family gets back on their feet,” added Rep. Weaver. “We need to put some teeth in our law to ensure that this abuse does not happen again.”
Under the bill, welfare recipients who use EBT benefits for alcohol, tobacco or a lottery ticket would be subject to disqualification from the program. The legislation also prescribes civil penalties to businesses that sell those products and accept EBT benefits as payment in violation of the law. The fine for a violation by the seller would be $100 for the first violation, $500 for the second violation within five years, and $1,000 for a third or subsequent violation within five years.
In addition, the legislation calls for welfare recipients who purchasing items or services banned under the proposed act to reimburse the state for the illegal purchase.
“Many taxpayers struggle to make ends meet and to pay their taxes,” added Beacon Center CEO Justin Owen. “The selfish misuse of the welfare system undermines those who truly need and utilize temporary assistance lawfully and causes widespread public distrust in government services. Taxpayers should not tolerate it.”