Politics & Policy

Maine Cracks Down on Welfare-for-Drugs

Maine’s state EBT card

On a muggy day last summer, agents from the Maine Drug Enforcement Agency and local police raided the home and office of Herman “Rusty” Hoffman. They’d been investigating him for months, and what they found didn’t disappoint: 500 capsules of bath salts, a handful of Suboxone strips, drug ledgers, three firearms, several motor-vehicle-inspection stickers that had been reported as stolen — and seven Maine electronic-benefits-transfer (EBT) cards.

EBT cards, which allow welfare recipients to withdraw cash benefits, have repeatedly appeared at drug busts in Maine, where they are being used as currency, new state records show. Fortunately, the data also suggest that recent reforms are effectively curbing such abuses.

Maine’s recently released statistics unveil a flourishing trade in EBT cards for drugs; from July 2014 to July 2015 alone, Maine investigators seized 37 cards in 22 drug cases, among fewer than 200 such search warrants conducted by the state, says Roy McKinney, head of the Maine Drug Enforcement Agency.

While many states record EBT cards as an “asset” or “financial instrument” seized at a crime scene, Maine last year began coding them in a distinct category, collecting meticulous data on how often the cash-benefit cards appeared at drug busts.

“We’ve learned that this is a common practice, for a drug dealer to take custody of an EBT card as payment, or in lieu of immediate payment — that is, of course, as a cash benefit,” McKinney says. The presence of multiple cards raises concerns about fraud that are often later confirmed, he adds.

Maine’s data collection on drug-related EBT seizures is part of a broader welfare-reform project pursued by Governor Paul LePage (R.) and his Department of Health and Human Services commissioner, Mary Mayhew.

Since LePage took office, the state has doubled its number of fraud investigators and increased prosecutions for welfare fraud; taken steps to block the use of cash benefits at casinos, bars, and strip clubs; capped cash-benefit eligibility at five years for able-bodied, non-elderly recipients; implemented drug tests for beneficiaries who’ve been convicted of a drug-related felony; and begun a voluntary pilot program to include photos on EBT cards.

Already, around 33,000 of Maine’s 104,000 welfare beneficiaries have opted to have a photo ID included on their EBT card, but the pilot program has still drawn heavy-handed federal criticism.

“The Obama administration has directly and indirectly tried to thwart our effort at every turn to improve the integrity of the food-stamp program by placing photos on EBT cards,” Mayhew tells National Review.

Though New York and Massachusetts have similar EBT photo requirements, the Obama administration has threatened litigation over Maine’s EBT photo-ID program, suggesting that it may withhold an unspecified amount of federal funds, too. Meanwhile, the federal government has also required the LePage administration to submit extensive paperwork about the program.

Nonetheless, Maine officials point to the drug-bust statistics to support their claim that including a photo on EBT cards reduces fraud. McKinney says he had his staff examine all 43 cash-benefit cards found at drug-related scenes since May 2014 to see if any of the cards officers seized had photos on them. “That was a negative,” he says, which suggests that the photo is “another deterrent, if you will, against the illicit use of this card.”

Maine officials point to the drug-bust statistics to support their claim that including a photo on EBT cards reduces fraud.

Yet even in instances in which EBT cards are found at drug busts, it can be tough to prosecute the dealers for trafficking in public benefits, Mayhew says.

“From the federal government’s perspective, if you have the PIN [to the EBT card], you are considered an authorized user,” she says. “So if the drug dealer has the PIN, the United States Department of Agriculture considers that drug dealer an authorized user. And that is simply ludicrous. When you talk to any law-enforcement officer, that is one of their constant complaints: They certainly can go after the drug dealer for illegal drugs, but [federal policy] makes it difficult for us to go after the trafficking offense.”

Mayhew says Maine’s photo-ID program, far from being criticized, as it has been by the Obama administration, should be replicated across the United States as a fraud-prevention measure. It’s a simple change that can prevent abuse, protect taxpayer money, and ensure that welfare funding remains intact for Americans who truly need public assistance, she says.

“The bottom line is, we have got to put significant pressure on Washington to get aggressive and reform this program — not in two or three years, when the Farm Bill is up for authorization, but now,” Mayhew says. “They need to demand that every state put photos on EBT cards.”

Jillian Kay Melchior writes for National Review as a Thomas L. Rhodes Fellow for the Franklin Center. She is also a senior fellow at the Independent Women’s Forum and the Tony Blankley Fellow at the Steamboat Institute.

 

Jillian Kay Melchior — Jillian Kay Melchior writes for National Review as a Thomas L. Rhodes Fellow for the Franklin Center. She is also a senior fellow at the Independent Women’s Forum.

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