The purpose of this study is to evaluate the effectiveness of state agencies current peer group systems, and to provide guidance to state agencies on how to evaluate and update their systems. Specifically, it uses empirical analysis to identify one or more effective models for establishing vendor peer groups that could apply to most state agencies.

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.