For Immediate Release
October 31, 2019
LANSING—The Michigan League for Public Policy issued the following statement on Department of Health and Human Services Director Robert Gordon’s testimony before a Senate committee today on DHHS’s efforts to increase the asset test limit for cash, food and heating assistance programs to $15,000. The new rule also eliminates vehicle considerations for cash and food assistance and allows applicants and recipients to self-attest, changes that lift a considerable paperwork burden from those who need assistance. The statement can be attributed to Michigan League for Public Policy President and CEO Gilda Z. Jacobs.
“Michigan’s low asset test limit is an outdated policy created because of a knee-jerk reaction to a singular anecdote, and it has been unduly punishing struggling families for making smart financial decisions ever since. The policy has also created a massive administrative burden for the Department of Health and Human Services, which is forced to spend valuable time, money and staff hours to oversee a program that is largely unnecessary and at its core harmful to the very people the department hopes to serve.
“Gov. Whitmer and Director Gordon recognized that it was holding people back from accessing the benefits they need to move forward, and after seven years of seeing families struggle, they are taking the right measures to change it. This has been a major priority for us year after year, and the Legislature has let this bad policy linger for too long. Now that there’s positive momentum to change it at the administrative level, we hope state lawmakers will get on board and help struggling Michiganders become more financially independent instead of forcing them to spend their emergency savings to put food on the table.”
The League has been working on this issue for a long time as a major way to help reduce poverty in Michigan, including it in the League’s Owner’s Manual for Michigan policy agenda and its annual budget priorities. One in 7 Michiganders don’t have enough to eat and an estimated 1.8 million live in communities with few affordable healthy food options, leading to incalculable costs in healthcare for diet-related diseases and unfulfilled potential among students and workers.
In 2002, the federal government gave states the option of setting their own asset limits for food assistance, including eliminating them entirely. Since then, 34 states and the District of Columbia have eliminated their asset tests. Michigan was one of the first states to eliminate the asset limits, but reinstated them in 2012.
Michigan’s asset test for food assistance is a state policy that can be reversed. Since states control the food assistance asset test, Michigan could opt to eliminate it or increase the level. To receive food assistance, families currently cannot have more than $5,000 in countable assets, with some exemptions for vehicles. Countable assets include, among others, checking and savings accounts.
Eliminating the asset test would not increase state costs, and may even save the state money. Food assistance benefits are entirely federally funded, so any increases in benefits would not come from the state’s General Fund. However, the state participates in food assistance administrative costs with a 50 percent match. Given already high caseloads for eligibility specialists, eliminating the food assistance asset test could streamline the state’s efforts
The Michigan League for Public Policy, www.mlpp.org, is a nonprofit policy institute focused on economic opportunity for all. It is the only state-level organization that addresses poverty in a comprehensive way.