USDA Food and Nutrition Service warns Illinois that implementation of Cook County’s beverage tax is in violation of Supplemental Nutrition Assistance Program regulations
By NACS Online
The Chicago Tribune wrote last week that the U.S. Department of Agriculture Food and Nutrition Service has warned Cook County that the collection of its new beverage tax is violating federal Supplemental Nutrition Assistance Program (SNAP) rules.
Federal regulations prohibit special taxes on food items purchased with SNAP benefits. However, writes the Tribune, Cook County has allowed retailers to tax such purchases “and provide refunds as a workaround for stores that haven’t been able to program their point-of-sale systems.”
In a letter dated August 7, Tim English, regional administrator for the Midwest Region at the USDA’s Food and Nutrition Service, warned the Illinois Department of Human Services that it could lose federal funding—roughly $87 million—for administering the tax.
“[Food and Nutrition Services’] strict interpretation that retailers may not charge the tax to SNAP recipients at any time and that providing an immediate subsequent refund … does not cure the problem or the violation of the law,” said James Dimas, secretary of the Illinois Department of Human Services, in a memo to Cook County President Toni Preckwinkle.
Cook County spokesman Frank Shuftan said in a statement that the county was unaware the USDA considered the county’s regulation to be unacceptable after a June phone conversation, and that the county believed USDA was considering the policy and would follow up with any concerns.
“At this time, we believe we are in compliance with existing SNAP rules. We do however recognize that USDA’s powers against the state in this regard are substantial and we will work collaboratively with both the state and USDA to address USDA’s concerns,” Shuftan said in the statement.
The Illinois Department of Human Services has until August 21 to submit a plan that details how the Cook County beverage tax will be fixed, or confirm a delay of the tax to allow retailers more time to program their point-of-sale systems for SNAP purchases.
The news source notes that it is not known how many Cook County retailers are applying the tax to SNAP purchases and then offering refunds.