NY Senate votes to ban spending welfare money at casinos, strip clubs for third year

By Teri Weaver | tweaver@syracuse.com

February 04, 2014 at 4:54 PM, updated February 04, 2014 at 5:56 PM

SYRACUSE, N.Y. - The New York State Senate today voted to ban using cash from public assistance money to buy alcohol, tobacco products and lap dances.

The "Public Assistance Integrity Act," which passed 53-4, would prohibit people on welfare and other public help programs from using their "electronic benefits transfer" card at ATMs in liquor stores, casinos and strip clubs. It would also limit people from using cash obtained through public assistance to buy alcohol, cigarettes and lottery tickets.

Under the proposed law, those caught three times could get their public benefits revoked for a lifetime.

"This legislation is designed to help people in need," said Sen. Thomas Libous, R-Binghamton, before the vote. "The majority of the people are not abusing it."

But some are, he added: "We don't want people to abuse the program and take it away from people in need."

Today marks the third time the Senate has tried to limit spending of public assistance money in certain businesses. The same bill, sponsored by Libous, passed the Senate last June but died in the New York State Assembly, which is controlled by Speaker Sheldon Silver, D-Manhattan, who never took it up for a vote.

But this year could prove different.

The state could lose $122 million in federal Temporary Assistance for Needy Families money for failing to create a policy to prevent people on public assistance from accessing benefits at casinos or liquor stores, according to Libous.

But it's unclear how much of that $122 million is at risk. The threat of loss comes from the federal Middle Class Tax Relief and Job Creation Act of 2012, which requires states to create better oversights on welfare spending.

Already, New York has taken measures to put some of the federal guidelines in place. Statewide, $7 out of every $10 in public assistance goes directly to the vendor (such as a landlord or utility company) instead of to the individual on assistance, according to the state data.

Still, Gov. Andrew Cuomo has endorsed some of the ideas from the Senate bill in the 2014-2015 executive budget (page 72), a signal some of the proposals could become law later this year.

"These reforms will help ensure that public assistance is used as intended: To ensure the least fortunate among us are able to access food, shelter and heat while limiting potential abuse and conforming with upcoming federal standards," said Rich Azzopardi, a Cuomo spokesman.

Still, there are differences between the Senate and the governor's proposals.

EBT cards work like a cash card at any ATMs or like a debit card at a store, according to a press release from Senate Republicans. The card accesses two separate accounts: Food Stamps and Cash Assistance. Food stamps are tightly regulated - but Cash

Assistance is not.

Cuomo's version goes after public benefits recipients who use their EBT cards inside certain businesses -- casinos, off-track betting parlors, strip clubs or liquor sales. His version would not punish people on public assistance based on what they buy.

And under the governor's proposal, penalties would be less stiff. People caught redeeming their public assistance from ATMs in liquor stores and similar businesses could lose their access to benefits for one month for the first offense, up to six months for four offenses or more. The suspension of benefits would extend to the person's family, under the governor's proposal.

Cuomo's version makes exceptions for grocery purchases in businesses that may also offer gambling.

The Senate bill would go further. It would limit purchasing alcohol, lottery tickets or tobacco products with any food stamps or other public assistance money. The bill includes a three-strikes-and-you're out provision - people caught for a third time would be banned permanently from receiving public assistance through cash or EBT cards.

Today, all Central New York senators voted for the bill: Sens. John DeFrancisco, R-Syracuse; Michael Nozzolio, R-Fayette; Patty Ritchie, R-Oswegatchie; James Seward, R-Milford; and David Valesky, D-Oneida.

Some who voted against the bill said they could support limitations that could ensure benefits would continue to go to children of adults who abuse the system.

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