coupons in FY 1976.

The recently proposed and rejected change in purchase requirements to a proportionate share of total income would have offset an estimated $650 million of this increase in the cost of bonus coupons. Enactment of P.L. 94-4 prevented this change in purchase requirements from being implemented. All available funds have been used to meet the program costs in FY 1975. Therefore, the $412 million of FY 1975 funds originally budgeted for use in FY 1976 are not available.

Public Law 93-347, enacted July 12, 1974, required Federal reimbursement of all State direct and indirect administrative costs on a 50-50 basis. Based on those budgets of estimated operating costs already submitted by State welfare agencies, it is apparent that the original amount of $146 million budgeted for FY 1976, which was based on very little program experience, will require an additional $154 million.

The increased level of program participation will also result in increased costs of printing the food coupons to be used by these participants, and will add an estimated $8.5 million to the budget estimate of $30 million for FY 1976. The increased caseload also places new demands on the Federal and State agencies to improve not only service to recipients but also program accountability, including satisfaction of the work registration requirements of the Food Stamp Program. Estimates supplied by the Manpower Administration of the Department of Labor indicate that the cost of employment service assistance associated with the work registration requirement will be at least $6 million in excess of the $22 million budgeted for this activity.

This revised budget may be on the high side because of the assumed rate of unemployment and the relationship of income growth to food price levels which are more accurately measured by other Federal agencies. These variables are very dynamic, and range estimates rather than fixed point estimates are more realistic measurements of their sizeable impact on the Food Stamp Program. A slight change from the estimates for any of these variables could have a very significant impact on the participation and cost levels of the Food Stamp Program.

UNITED STATES DEPARTMENT OF AGRICULTURE

Food and Nutrition Service

Justification for Budget Amendment, Fiscal Year 1976, for the "Food Stamp Program"

A total of $6,590,095 is requested to cover the additional average monthly caseload of 20.7 million persons in 1976, the amendments contained in P.L. 93-347, and the cost of printing coupons and other factors for which the recognized impact on the program cannot be measured.

The high rate of unemployment has pushed participation in the Food Stamp Program to historically high levels.
Families and individuals with low income and/or unemployed turned to the Food Stamp Program for assistance in
meeting the rising cost of food. The estimated participation level of 15.8 million persons for the end of
FY 1975 was already exceeded by November 1974. By May, 1975, participation reached an historic high of 19.5

60-765 75 pt. 1 17

million persons. This surge in participation makes necessary revision of the estimate of average monthly
participation from 15.6 million originally estimated to 20.7 million persons per month in FY 1976. The
monthly cost of the Economy Food Plan for the average four-person household will be increased from the current
$154 to $162 from July 1 through December 31, 1975. This differential is $2 less than the increase originally
estimated for the first six months of FY 1976. The average monthly bonus per person will rise from the
original estimate of $19.25 to $24.82 in FY 1976. The increased participation will add over $2.5 billion to
the cost of bonus coupons in FY 1976. The recently proposed and rejected change in purchase requirements to a
proportionate share of total income would have offset an estimated $650 million of this increase in the cost of
bonus coupons. Enactment of P.L. 94-4 prevented this change in purchase requirements from being implemented.
All available funds have been used to meet the program costs in FY 1975. Therefore, the $412 million of

FY 1975 funds originally budgeted for use in FY 1976 are not available.

The increased level of program participation will also result in increased costs of printing the food coupons to be used by these participants, and will add an estimated $8.5 million to the budget estimate of $30 million for FY 1976. The increased caseload also places new demands on the Federal and State agencies to improve not only service to recipients but also program accountability, including satisfaction of the work registration requirements of the Food Stamp Program. Estimates supplied by the Manpower Administration of the Department of Labor indicate that the cost of employment service assistance associated with the work registration requirement will be at least $6 million in excess of the $22 million budgeted for this authority.