NASHVILLE, Tenn. — State Senator Jim Tracy’s (R-Shelbyville) bill to curb abuse of purchases made through Electronic Benefit Transaction (EBT) cards used by recipients of the Temporary Assistance to Needy Families (TANF) program sailed through the Senate Health and Welfare Committee today. Senate Bill 244 prohibits use of a welfare recipient’s EBT card in liquor stores, adult cabarets and casinos or gambling facilities.
“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 purchases like alcohol, gambling and adult cabarets,” 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. The Center reported one transaction at a liquor store totaling $790.
Under the bill, welfare recipients who use EBT benefits at liquor stores, adult cabarets, or gambling establishments would be subject to disqualification from the program as permitted by federal law and also would have those misused benefits recouped by the Tennessee Department of Human Services. 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 $1000 for the first violation, $2500 for the second violation within five years, and $5000 for a third or subsequent violation within five years.
In addition, the bill bans the use of EBT benefits at an ATM located inside a liquor store, adult cabaret, casino or gambling establishment.
“I’m proud to sponsor this bill and help reform the welfare system in Tennessee,” said Senator Tracy. “We need to continue to make sure that taxpayer money is used appropriately and I applaud the Department of Human Services for working with me on this bill.”
“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.”