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Congress Mulls Allowing Online Food Stamp Purchases

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Many on welfare may soon be able to purchase food online with their food stamps as part to a pilot program from the Department of Agriculture (USDA), and Congress wants to make sure the program will work properly.

In one its final hearings for the 114th Congress, the House Committee on Agriculture heard from two online food retailers Wednesday. Amazon and Thrive Market, which sells non-perishable organic food items, that have applied to be a part of a two-year USDA pilot program that will test allowing food stamps sales online. (RELATED: Democrats: Letting People Use Food Stamps Online Will Help Avoid ‘Health Crisis’)

The committee’s hearing comes as many wonder what how President-elect Donald Trump’s administration will approach welfare and food stamps.

Republicans tried and failed to remove the food stamps program from the 2014 Farm Bill, but the 66-page platform agreed upon at the Republican National Convention last July suggested that Congress “separate the administration of SNAP from the Department of Agriculture,” which would mean that appropriations for the welfare program would likely have to come from another piece of legislation. (RELATED: Congressman: Republicans Should Prepare For ‘One Hell Of A Fight’ If They Want To Cut Food Stamps)

The goal of the pilot program is to “increase access to fresh foods for customers in rural and urban communities alike who are not near—or able to travel to—a fresh food retailer,” Republican Texas Rep. Mike Conaway, chairman of the Agriculture Committee said at the hearing.

Conaway, a Republican congressman, said it’s important to craft policies that work improve the Supplemental Nutrition Assistance Program (SNAP), also called food stamps, to insure the program is working as intended. “If we can get the policies right, the we can figure out whether or not we can afford them,” Conaway said at the hearing.

“As a taxpayer myself, and as a steward of taxpayer dollars, I want the dollars that go toward SNAP to be well spent,”  Conaway said in his opening statement. “SNAP dollars that are used inefficiently are SNAP dollars that are not feeding people, or helping them learn about healthy eating, or helping them find work and ultimately lifting them off of the program,” Conaway said.

Democratic Rep. Jim McGovern of Massachusetts said that even though allowing food stamp purchases online “would require an increased investment … the return on investment would be enormous.” McGovern, the top Democrat on the Nutrition Subcommittee, said that after multiple hearings over the past few years, Congress should learn that the food stamps program “is effective, and it is efficiently run.”

“SNAP program is a powerful tool for improving nutrition, insulating families against hardship, and lifting people out of poverty,” McGovern said.

“Increase access to food,” and said that expanding SNAP education and incentivizing the purchase of more nutritious foods “would require an increased investment.” McGovern said that But I think the return on investment would be enormous.

Allowing people to use food stamps online “would open up new options for millions of SNAP recipients, while providing our existing customers who are SNAP recipients with the ability to stretch their SNAP dollars and choose the payment type that is best for them” Eric French, director of grocery at Amazon said at the hearing.

Amazon appears to be a natural partner for the project, as they captured 22 percent of the total e-commerce food market in 2015, a share worth $6.16 billion.

The USDA was required by the 2014 Farm Bill to develop a plan for allowing food stamps to be used online, but only began implementing the pilot program this fall. The agency will announce its final selection of partners for the pilot program in late December. Once the online retail partners are selected, they will be able to accept food stamps in all but seven states. Alaska, Calif., Hawaii, N.C., Va., W.V., and Wisc. are not eligible for the pilot program, according to the USDA’s summary of the pilot program.

“It’s amazing that in the 21st century you still can’t use SNAP benefits online, but one can buy almost anything else online,” Gunnar Lovelace, co-founder and CEO of Thrive Market told the committee.

Thrive Market ran a campaign advocating for use of food stamps online over the summer, recruiting several Hollywood celebrities to bring attention to the issue, and attracting more than 330,000 people to sign a petition.

“Partly in response to our campaign, the USDA has committed to a specific timetable for launching an online SNAP pilot program in a few key states in the first half of 2017,” Lovelace told the Agriculture Committee.

Thrive Market, which Lovelace describes as “fastest growing health food e-commerce company in history,” was founded in 2014 and raised $111 million from investors this summer.

Thrive’s products on the site are organized by several lifestyle categories to make it easier to browse products that appeal to paleo, vegan, and gluten-free dieters. Lovelace argues Thrive’s set up makes the site perfect for potential food stamp users, since certain SNAP users are banned from using benefits to purchase certain items.

Thrive and other online companies “can easily categorize the grocery products in our database which are SNAP approved,” as the internet is “fundamentally a database driven technology that allows for precision in classification and reporting,” Lovelace said.

Peterson said that while allowing food stamp sales online might be helpful, many parts of his rural Minnesota district may not even have internet. “My farm up north — we don’t have cell service,” Peterson said. “I’m not sure there are two towns in my area where you can get delivered groceries,” he said.

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