On Jan. 22, President Joseph Biden signed an executive order calling on the U.S. Department of Agriculture (USDA) to expand and extend federal nutrition assistance programs, including the Supplemental Nutrition Assistance Program (SNAP).
Biden has indicated that addressing hunger and food insecurity will be a priority for his administration. The order comes just after Congress expanded food benefits in the $900 billion stimulus package passed in December, which increased monthly SNAP benefits by 15% for all recipients through June 2021, gave states additional flexibility to support the distribution of the Pandemic Electronic Benefits Transfer (P-EBT) and expanded the program to children younger than six years old through September 2021.
The COVID-19 pandemic has swiftly worsened the longstanding food insecurity problem in the U.S. Pre-pandemic, more than 35 million people struggled with food insecurity, according to Feeding America, the nation’s largest hunger-relief organization. Now that number is closer to 50 million.
The problem is especially pervasive for families with young children. In the latest Household Pulse Survey from the U.S. Census, 18% of families with children said they did not have enough to eat in the last seven days, compared to 11% of those without kids.
Digital disruption is impacting how customers use their SNAP benefits, which could affect how many customers are relying on c-stores for SNAP purchases in some areas. Data on SNAP usage trends during fiscal year 2020 will be available later this spring.
Most SNAP payments today are made in-store, through electronic benefit transfer (EBT) payment cards. But with everyone encouraged to stay home as much as possible during the pandemic, USDA’s Food and Nutrition Service (FNS) — the agency that oversees SNAP — has approved 46 states and Washington, D.C. for SNAP online purchasing. Retailers are also offering pay and pickup for SNAP recipients, also known as “click and collect.”
Online purchasing is currently available through limited retailers like Amazon, Walmart and Aldi. With Amazon, SNAP customers can access more than 100,000 items and get free shipping on orders over $25. SNAP beneficiaries also have complimentary access to Amazon Fresh with free shipping on orders over $35 in most states.
But many SNAP users live in low-income neighborhoods that are outside these delivery zones, and the added delivery fees can be insurmountable for some customers.
In hopes to help subsidize costs for SNAP beneficiaries, Instacart started waiving delivery fees in December for the “first three EBT orders for each customer with a valid EBT card associated with their account” until March 16.
At the moment, Instacart only allows SNAP customers to purchase food at Aldi. But Instacart Vice President of Global Retail Chris Rogers has said the company has lobbied the USDA to approve more retailers.
All retailers, including online retailers, must abide by the FNS retailer stocking requirements in order to be authorized. In addition, SNAP-eligible retailers who want to add online shopping to their e-commerce platform must meet online purchasing requirements and submit a letter of intent to the SNAP Online Purchasing mailbox.
Out of the more than 150,000 c-stores in the U.S., more than 111,800 participate in SNAP — representing 45.15% of all retail outlets authorized to accept SNAP benefits.
In 2014, a Farm Bill was passed and signed into law that included additional requirements for SNAP retailers. Subsequently, FNS finalized a rule in December 2016, which enacted some of the 2014 Farm Bill’s provisions and other requirements for retailers. Congress passed legislation in 2017 and 2018 that delayed the rule until FNS expanded the definition of “variety” so that it is workable for small-format retailers.
In its proposed rule published in April 2019, FNS proposed expanding what will count as variety in the staple food categories, which would make it more realistic for convenience stores to comply with the new requirements. But the agency has yet to finalize its rule.
To participate in SNAP, convenience stores must meet “depth of stock” requirements that specify the amount and types of foods they must have available on their shelves for customers. The 2014 Farm Bill expanded these requirements. Subsequently, FNS finalized a rule enacting those depth of stock provisions as well as additional provisions.
Under the Final Rule, to participate in SNAP, convenience stores must:
- Stock seven varieties of foods in each of the four staple food categories: (1) meat, poultry or fish, (2) bread or cereals, (3) vegetables or fruits, and (4) dairy, and at least one perishable food item in three of the categories.
- Have three units of every variety, 84 total items, on shelf.
“Stocking a breadth of healthy foods, participating in State SNAP Nutrition Education (SNAP-Ed) and incentives and ensuring that store staff understand and follow SNAP rules are important ways in which all SNAP-authorized stores can assist in addressing food insecurity,” said a SNAP spokesperson.
But meeting the requirements can be difficult for convenience stores and other small-format retailers.
Jim Bosworth, senior advisor for PetroActive Services and former president of Cary, N.C.-based Breeze Thru Markets, said it can be difficult to strike a balance between the needs of the SNAP customer and the government requirements.
“I think it would make sense — and this is just my own opinion, having dealt with it on the convenience store side for so long — to have some separation of eligibility from a retailer standpoint,” he said. “It’s one thing to be a grocery store and not have a problem stocking everything that is in this entire list.”
After all, he said, the average supermarket is almost 15 times larger than the average c-store. And in some areas, convenience stores are the most accessible food retail locations, or the only food retail locations open outside of traditional grocery store hours.
“These are two very different channels of retail,” Bosworth said, “yet they still service the customer based on what the customer needs at that time.”