Pa. lawmaker seeks to close welfare loophole

HARRISBURG - When State Rep. Dave Reed toured his local county assistance office a few years back, he was stunned to learn that current law does nothing to prevent welfare recipients from using taxpayer-backed benefit cards to buy alcohol.

"I had no idea at the time that such a loophole existed," said Reed, a Republican from Indiana County. "I don't think most people did."

Now they do. This week, Reed's bill prohibiting the use of welfare benefits, as well as child-support payments, for alcohol purchases unanimously passed the House.

The measure now heads to the Republican-controlled Senate, where it could be considered as early as the end of June.

"We have not reviewed the bill in detail, but it is a concept I believe has general support," said Erik Arneson, spokesman for Senate Majority Leader Dominic Pileggi (R., Delaware).

But administration officials question whether the bill is trying to address a problem that doesn't necessarily exist. Others believe Reed's measure perpetuates the stereotype that people who receive government assistance are irresponsible.

Neither the Department of Public Welfare nor the Liquor Control Board, which runs the 619 state liquor stores, tracks detailed data on such purchases. Administration officials say they have no evidence that recipients abuse their benefits.

"This is another example of a solution in search of a problem," said Chuck Ardo, spokesman for Gov. Rendell.

Ardo also said the administration was concerned about "unwarranted government intrusion into the lives of these families."

DPW spokeswoman Stacey Witalec said, "We are not by any means advocating that people use these funds to go to a liquor store. However, when should government play a role, and where is it intruding on grounds where personal responsibility should be playing a stronger role?"

Reed's bill would prevent state liquor stores and privately owned beer distributors from accepting electronic benefit cards, known as EBTs, which are part of DPW's cash-assistance and food-stamp program. An agreement between DPW and the Liquor Control Board already calls on State Store clerks to turn away such cards, but Reed's measure would put the force of law behind it.

Roughly two million residents receive cash assistance, food stamps, or medical assistance.

The legislation would also ban liquor and beer stores from accepting debit cards credited with child-support payments. DPW officials say roughly 52 percent of people who receive child support use such cards, with the remainder opting to receive their payments through direct deposit.

Still, there are ways around Reed's bill for the determined.

Welfare recipients, for instance, can take their electronic benefits cards to an ATM and withdraw cash, which they can then use as they please.

And the cards used by people receiving child support look like any other credit card, making it difficult for clerks to enforce any laws.

Beyond enforcement issues, public-welfare officials and others point out that the bill could unfairly cast aspersions on truly needy residents who depend on public benefits to live, not to live well.

"It perpetuates the stereotype that women on welfare are irresponsible and immoral and can't make appropriate decisions," said Carol Tracy, executive director of the Women's Law Project in Philadelphia.

Others said that child-support payments do not even use public money; they result from private agreements between parents. The DPW simply acts as a conduit for the payments.

Reed said his measure was an attempt to apply a common-sense fix to the law.

Democrats in the House agreed. Brett Marcy, spokesman for House Majority Leader Todd Eachus (D., Luzerne), said that "by virtue of the vote, you can see that members overwhelmingly believed that this was practical, common-sense legislation."

Reed said common sense dictates that children don't consume alcohol, so child-support payments shouldn't be used to buy it.

Common sense, he added, also dictates that "every welfare dollar that's used to buy alcohol is a dollar that isn't available to help someone truly in need."

"Taxpayers are generally pretty generous when folks are in need but get irritated quickly when they see these loopholes," Reed said. "It makes them more cynical in wanting to continue helping more folks. . . . This bill is trying to correct that."