This report provides a comprehensive picture of individuals’ patterns of participation in the Food Stamp Program during 2001-2003, a period of steady caseload growth. Based on data from the Survey of Income and Program Participation, the research explores reasons that individuals enter and leave the FSP, how long they stay on the program, whether they return to the program after exiting, and what factors distinguish those who make greater use of the FSP than others. The research also examines whether participation patterns in 2001-2003 changed from patterns in the 1990s.

This report – the latest in an annual series – presents estimates of the percentage of eligible persons, by state, who participated in the Food Stamp Program (FSP) in an average month in fiscal year 2005 and in the 2 previous fiscal years. This report also presents estimates of state participation rates for eligible “working poor” individuals (persons in households with earnings) over the same period. 

The report draws on data for households participating in the Food Stamp Program under normal rules and thus does not include information about those who received disaster assistance after the Gulf Coast hurricanes in September and October 2005. 

This report is the latest in a series on food stamp participation rates based on the March Current Population Survey, and presents national participation rates for fiscal year 2005.

Because of concerns about poor diet, overweight, and obesity among low-income Americans, there is considerable interest in using federal nutrition assistance programs to promote healthy choices. Some argue that food stamp recipients should be prohibited from using their benefits to buy foods with limited nutritional value (commonly described as “junk” foods). The Food Stamp Act currently places few limits on the use of food stamp benefits, as long as they are used to buy food to eat at home. The idea of restricting the use of food stamp benefits may be appealing on its face. However, upon closer examination, serious concerns emerge regarding the feasibility and rationale for the proposed restriction.

A fundamental issue in the design of the Food Stamp Program (FSP) is the form benefits should take. Advocates of the current coupon system argue that coupons are a direct and inexpensive way to ensure that food stamp benefits are used to purchase food. Coupon advocates contend that, despite some evidence of fraud and benefit diversion under the current system, food stamps are used largely to purchase food. In addition, they contend that coupons give household food budgets some measure of protection against other demands on limited household resources. Advocates of cashing out the FSP argue that the current system limits the food-purchasing choices of recipients and places a stigma on participation. Moreover, they cite the cumbersome nature and cost of coupon issuance, transaction, and redemption.

A fundamental issue in the design of the Food Stamp Program is the form the benefits take. From the inception of pilot programs in the early 1960s to the contemporary program, the vehicle of choice has been the food stamp coupon, a voucher that can be redeemed for food at authorized retailers. For nearly that same period analyses have considered the relative merits of cash--or, in practice, checks--as an alternative. Advocates of the current coupon system argue that coupons are a direct and inexpensive way to ensure that food stamp benefits are used to purchase food, that the unauthorized use of food stamps is relatively limited despite some evidence of fraud and benefit diversion, and that coupons provide some measure of protection to food budgets from other demands on limited household resources. Advocates of cash benefits argue that the current system limits the purchasing choices of participants; places a stigma on participation; does not prevent the diversion of benefits (as evidenced by the existence of illegal trafficking); and entails excessive costs for coupon production, issuance, transaction, and redemption.