Senate approves restrictions on EBT use in bars, strip clubs, tobacco shops

Monday, February 25, 2013 at 11:15pm

The state’s upper chamber voted unanimously to penalize people who spend their taxpayer-funded welfare benefits on drinking alcohol, gambling or visiting strip clubs.

The Senate voted 30-0 on new rules that came after an investigation from a free-market think tank that found the electronic debit cards carrying government funds for low-income people were swiped at places like bars, strip clubs and tobacco shops.

The proposal would make it illegal for people collecting welfare benefits to knowingly use the card or draw money off of the card from an ATM at a liquor store, gaming establishment or adult cabaret. Anyone caught would be required to pay the money back to the state. Benefits would be permanently revoked after withdrawing money from the card via an ATM at those locations a third time.

The legislation would also require operators of those venues knowingly accepting EBT cards pay $1,000 fine for the first offense, climbing to $5,000 for the third offense in five years.

The benefits are given under the Temporary Assistance of Needy Families program. The welfare funds are deposited on Electronic Benefit Transfer cards, known as EBT cards, that work much like debit cards.

The legislation still needs approval in the House of Representatives. The House version, House Bill 119, awaits a hearing in the House Health Subcommittee.

18 Comments on this post:

By: Rasputin72 on 2/26/13 at 3:52

They do not call these people underclass because they are poor.

By: st8of10ec on 2/26/13 at 9:28

A friend of mine that works at Kroger tells me they'll use the welfare benefits on food & the turn around & buy literally cases of beer & cartons of cigarettes with the cash they have.

By: Rocket99 on 2/26/13 at 9:32

So, let me get this straight. If this becomes law, they can not step into a liquor store, strip club or bar and use their ATM machine but, they can go to Mapco, Kroger, WalMart, etc. and use it.?

What stops them from going someplace else and withdrawing cash and then going to the other places?

I thought the reason for these cards was for what used to be food stamps and there already were restrictions on the cards as to what could be purchased with them. Are there other non-discrimitory funds on the EBT cards? I guess so.

By: kevin47881 on 2/26/13 at 10:20

There is technology available to make the cards unusable at certain venues based upon merchant code. That is the easiest remedy to this problem.

By: NewYorker1 on 2/26/13 at 10:51

WOW!!! They need to do away with the EBT program completely. Why does this program exist anyway? I don't understand why we are giving away free money. If anything, people that are on EBT should be out picking up trash on the side of the roads, filling pot holes on the streets, etc. Our cities should be spotless.

By: budlight on 2/26/13 at 11:12

I agree with you New Yorker. And Kevin, you are way to advanced for the "government mentality". They don't want to hear about an easy way. They complicate everything. I mean, why give these people an EBT card to use like a credit card? Oh, because they are ashamed to be on food "stamps". the old way was fine. Maybe if the ones on it had to eat a little crow and not be pampered, they'd use the cards wiser. I have heard of them buying lobster and wine with the government dole.

By: fair_minded on 2/26/13 at 2:28

Most of you who replied obviously don't know anything about the EBT program nor did you read the article very well.

The EBT card basically has two functions-- (1) cash welfare payments, and (2) food stamps.

If you only get food stamps, you cannot use the card to get cash in any manner. Nor can you buy hot food, soap, alcohol, toilet paper, tobacco, and a list of other items. This is programmed into the card.

The "old way" was not so fine, as it encouraged and made it easier for people to sell or trade their food stamps for cash or other items.

If you are enrolled in the Temporary Assistance of Needy Families program, then you can ALSO use the card to get cash. This replaced the "welfare check." This is what this article and the new regulations are about-- not food stamps.

These funds are for families to buy soap, toilet paper, diapers and other items not available with food stamps. Single people and married couples with no children do not need these items.

The funds can also be used for electric and water bills and rent.

Is there the opportunity for abuse in the system? yes, and it should be corrected. However, we should not cease to give assistance to the poor and needy simply because a few folks are greedy.

By: Rasputin72 on 2/26/13 at 4:13

Fair_Minded.......An excellent explanation indeed. Now if we can add to the requirement for an EBT card, "Working like a dog from sun-up to sundown" then we would have an acceptable welfare assistance program.

By: yucchhii on 2/26/13 at 4:47

First off, I never thought that was legal. Now I hear that they made it illegal..Ok. That's fine! What I don't get, is why they can't purchase HOT FOOD on EBT? Go into a supermarket and maybe you'd like to buy rotisurry chicken....WHY NOT? What's the problem with it?

By: pswindle on 2/26/13 at 5:17

They already have restrictions that prevents spending for the wrong items. This is just TN sticking their noses in something that is none of their business. This is federal. The GOP hates the Federal Government, but they want to control it.

By: NewYorker1 on 2/26/13 at 5:35

fair_minded... Ok, first of all, people who can't afford children shouldn't have them. PERIOD! In today's many birth control options, there's no excuse. These programs are NOT fair to single people or married people with no children. We are basically paying for some else’s mistakes.

By: NewYorker1 on 2/26/13 at 5:39

Something has to be done. We can't keep allowing people to make these decisions and we sweep it under the rug with handouts. These people are killing us financially. It ticks me off every time I look at my tax bill and realize how much of my time is spent working to take care of someone else. I am even considering leaving the United States because of this very issue. It’s ridiculous.

By: mg357 on 2/26/13 at 7:25

mg357..Just a few days ago, I read an article in the Jacksonsun in Jackson Tenessee on this topic. There was a retailer there who was buying these cards and paying like .50 cents on the dollar and then redeeming them for full price thru the FDA. The TBI. FBI, AND the Secret Service all raided his store and took boxes of records and EBT/foodstamp cards. Everybody knows what goes on with this, my question is why give them 3 chances to get their act together. The same is true with Tenncare and drugs we pay for. The names on those cards are traceable and I suspect the owners will get the shock of their lives, they committed fraud themselves along with the store owner. First time I ever saw Secret Service involved. WBBJTV Jackson Tn. and watch the video...

By: jonw on 2/26/13 at 9:14

Pisswindle:
You are only interested in letting this fraud continue because it is being corrected by a Republican legislature. There is proof that the Feds have not corrected the problem. Frankly, I don't carte if Democrats, Republicans, or Independents do it, Just get 'er done.As Rhett Butler said in "Gone With The Wind," "Frankly my dear, I don't give a Damn."

By: Jughead on 2/27/13 at 12:09

%$^&*(!!!! Amerika is a disgusting welfare state filled with Oxycontin addicts and liberal politicians. I cannot wait for this country to implode.

By: courier37027 on 2/27/13 at 2:25

Remember folks, we are told that it costs too much to process and mail checks. Rampant fraud is okay, but that darn 46 cents stamp and killing a tree for checkbook paper is evil.

By: fair_minded on 2/27/13 at 5:29

@yucchhii - you can buy a cold rotisserie chicken, just not a hot one. presumably this restriction is to keep a person from using it at a restaurant, where you're paying more for the preparation than for the food itself.

@courier37027 - actually one reason they went to cards was to reduce fraud-- and it's worked to a degree. It's obviously not eliminated it, but has knocked a hole in it.

@mg357 - that paper must have got part of the story wrong. AFAIK merchants can't redeem a "card"... the customer keeps the card just like a debit card, and the transaction goes into the cash register.... also, I don 't believe the FDA is involved in the process-- it's a joint venture between the state and the US Department of Agriculture.-- at least the food stamp part is. However, they *could* simply ring up dummy transactions, giving the card back to the customer-- but you're correct that the cards are traceable- one of the benefits of the cards themselves. You're also correct about the three "strikes." Following that theory, could I kill two people before it became really serious??

@NewYorker - you are correct that people who cannot afford children should not have them. please submit your plan for correcting this. Otherwise, we cannot let children starve and live on the street because their parents make bad decisions.

@jonw - while it's a program of the US Department of Agriculture, it's administered by the state and so the state makes most of the rules for eligibility and administration

@Rasputin - well.. that's the problem. There *are* many people working who still do not earn above the poverty level-- especially with families. And in today's job market, there are still many who cannot honestly find a job. Then there are the elderly and handicapped. Not everyone is scamming the system, only a few.

By: mg357 on 2/28/13 at 9:18

mg357....fair minded, point taken, my mistake I should have said the USDA...I've never known the Secret Service to get involved before...one by stander said that the guy was just trying to make a living, yes, he was and that stunt is going to cost him dearly....