Rick Santorum

Mr. SANTORUM

Mr. SANTORUM. Yes.

Mr. SANTORUM. Mr. President, pursuant to section 310(d)(2), I raise a point of order against the pending amendment because it reduces outlay savings for the Finance Committee below the level provided in the reconciliation instructions, and the amendment would not make compensating outlay reductions or revenue increases.

Mr. SANTORUM. I said, what you are suggesting is that someone who is no longer on AFDC but is Medicaid eligible because of this grandfathering is not going to have an incentive to take a better job, potentially with benefits, potentially with opportunities for greater advancement, because if they come into a situation where they lose that job, they would not be able to get back on Medicaid. I am looking at someone making an economically rational decision. To me that would not be an economically rational decision. I think the grandfathering does take care of that situation, and if that mother does have a problem and falls back on AFDC, she is then eligible for Medicaid again. I do not think I see the problem that the Senator from Rhode Island has put forward.

Mr. SANTORUM. These are people who are not on AFDC anymore. These are people who are working, because if they were on AFDC, they would be included under the new program.

Mr. SANTORUM. I thank the Chair. First, let me say, Mr. President, that we have had votes on block grants here in the Senate in the past. We had one on the bill last year. In fact, when it came out of the Agriculture Committee, there was no block grant. The block grant was offered here on the floor of the Senate and was passed in the Senate. It was included in the welfare reform bill that was passed here in the Senate. It was included in the bill that passed originally, as I said before, in the Senate, which passed 87 to 12. The Senator from North Dakota voted for that, as well as other provisions in the bill. The block grant included in the Senate bill--

Mr. SANTORUM. It was included in the Senate bill, which passed 87 to 12 here, in the reconciliation bill, and in the welfare bill that was vetoed by the President. In fact, the block grant provision that is in this bill actually has a lot higher hurdles for States to jump over to get a block grant, because in the bill that originally came through here, there was a requirement in the original Senate bill that 85 percent of the money be spent on food. In this bill, 94 percent of the money has to be spent on food stamp aid. So States have a higher requirement. In this bill, you can get a block grant only if you have EBT, electronic benefits transfer, a computerized way of providing food stamps. In the other bill, there was no such electronic benefits transfer. In this bill, you have to meet one of these criteria to get in. An error rate of under 6 percent. The national error rate is between 9 and 10 percent. So you have to have a pretty good error rate to be able to qualify for a block grant. There are only a few States who qualify-- Massachusetts, Alabama, Kentucky, Arkansas, Louisiana, South Dakota, and the Virgin Islands. Maryland, Texas, and South Carolina qualify for electronic benefits transfer. If you have an error rate above 6 percent, you have to use State dollars to, in fact, pay down the error rate to make up the difference--obviously, an expense of the States. So we have a much higher standard here of qualifying, and the standard is set for the purpose of making sure that the States that do take a block grant either have a technologically advanced program like electronic benefits transfer, where you get the debit card instead of the stamps, which you then use to purchase your food, or you have a good system which has a low error rate. I think when you consider the fact that only 7 jurisdictions out of the 50-some that we have receiving these programs have such a low error rate, I think we have set the standard pretty high here. So this is not an easy thing that lots of States are going to jump into. Most States will not qualify for these block grants. So we believe we have set an appropriate standard. The Senator from South Dakota talked about the Florida rate and how it was going along at a nice rate, and then jumped up, and they got caught and they were stuck. Well, as the Senator from North Dakota knows, they are not stuck. Under this bill, as under the previous block grant proposals, the Governor and legislature of Florida can opt in, but they can also opt out. It is a one-time thing. You stay in, or when you go out, you are out forever. If they do not want to swim in the pond and do not like the water temperature, they can get out. They would have to sit on the beach and watch. They had their chance to swim. We think that is fair and that gives an adequate chance for States who run into difficult situations. This is certainly a safety valve for a State that might find itself in some sort of cataclysmic situation. The other things we allow States to do, which is positive, is to take the money that they have had--I cannot see the exact years on the chart, but say they had 3 or 4 good years, where it was perking along at a low rate, and because we have given them a block grant, they do not have to comply with all the bells and whistles that we require in Washington; they can run their own program. As most Governors told me, they can run it a heck of a lot more efficiently than we make them run it out of Washington. So let us assume--and I do not think it is unreasonable to assume this--if the food stamp rate stays the same and we are giving increases in funding, then they would be able to save money. We allow them to keep up to 10 percent of the total amount that they--I will rephrase that. If they do not spend all of the money that has been allocated to them in the block grant, and they spend, let us say 95 percent of it, well, the 5 percent they do not spend they can put in a fund and carry it over. They can carry over up to 10 percent every year, and up to 30 percent of an annual allocation, which means they can have a rainy day fund here to take care of situations where you have that little spike because of a hurricane or something like that. That is what prudent State planners should do when it comes to these kinds of programs. We provide for that in this bill. So we think that there are adequate safeguards there for these kinds of spikes in benefits. The Senator also said there is no maintenance of effort provision. Under the current Food Stamp Program, 50 percent of the administrative costs are paid for by the Federal Government, and 50 percent are paid for by the State government. They said we do not require them to maintain their effort; in other words, require them to pick up 50 percent of the cost. That is true and it is not true. Specifically, do we require them to pick up the effort? No. But what we say, as I referred to earlier, is that now 94 percent of the money they get must go for food stamps; 6 percent is administrative. What is the average administrative cost for the Food Stamp Program today? Coincidentally, 12 percent. What does that mean? That means that 6 percent now is going to be federally funded. That is the 6 percent you can use for administrative costs, and, if they want to continue their spending at a rate of 12 percent for administrative costs, who is going to pick up the other 6 percent? The State with State funds. No, we do not specifically say you have to maintain effort. But we give you only half of the money you would normally use to administer the program. So, if they can do a better job administering the program, if they get from 12 percent down to 10 percent, we say you can keep the savings, and you can use State dollars for the savings. I do not think that is a bad thing. I think if they can reduce their administrative costs they should get the benefit of reducing those costs. So we have set up a system that says we want to give you the opportunity, if you think you can run this program better than we can, if you think you can feed more people, if you think you can do it more efficiently, we are going to give you the opportunity. When you do that, you have to submit a plan to HHS. They have to get approval. You have to say in that plan how you are going to serve a specific population. As you know, when we submit plans here, as we had this discussion earlier today about getting waivers approved by the Department of Health and Human Services, that is not an easy thing to do sometimes. So we put hurdles in place to make sure that these plans are adequate to serve the needs of hungry people in the respective States, and we require them to maintain a quality control program, and, frankly, you know that just makes sense. So we have adequate controls in there to make sure this is a good plan for the people of the State. We give them the option to do it. If they have a bad year, or some doom on the horizon, they can get out. So we give them the flexibility to get out. We give them the opportunity to save money on administrative costs by putting in a better system, and we set standards so they have to either be technologically advanced like an EBT system--that is a much more efficient system to get into this program in the first place--or they have to have lower error rates, which means they have to have a well- run program to get in here. So, I believe we have come up with a plan here that provides adequate safeguards for the hungry in those respective States, gives States an incentive to be innovative, to be efficient, to provide actually more and better food services to the people in their State, and in the end provide the safety valve for States that might find themselves in the situation which Florida found themselves in with an escape hatch, a one-time escape hatch in the bill. So, I think what this bill has done is it has taken what was-- frankly, no offense to the author--a relatively crude Food Stamp Block Program that was offered here on the floor and has been refined through conference because some of these cases are made in the conference bill, and additionally refined by the Agriculture Committee, which the Senator from North Dakota and I both sit on. As you know, excellent work comes out of that committee. We have refined it, and now we are at the point where I suggest we have a fairly solid, responsible program that is going to be limited in impact because of the limitation of States and their ability to get in here and have adequate safeguards to make sure that not only people who are in this program are fed, but that States that run into problems can get out. I reserve the remainder of my time.

Mr. SANTORUM. I apologize. I am sorry.

Mr. SANTORUM. Mr. President, I ask unanimous consent that further reading of the amendment be dispensed with.

Mr. SANTORUM. Will the Senator yield?

Mr. SANTORUM. Mr. President, in response to the last assertion that Florida would not be hit by another natural disaster if Florida opts out of a block grant, in the Federal entitlement program they are covered under the existing Food Stamp Program. I do not understand why the opt out is such a bad idea. The fact is that what you want to accomplish is to put them back into the main program.

Mr. SANTORUM. Mr. President, I rise in opposition to the amendment. I will respond as to why. The Senator from Florida repeatedly talked about how those States that are currently disadvantaged that are way behind from the start are going to get put further behind, as if the States who were far behind were there--as I heard this term a lot on the floor--through ``no fault of their own.'' I hear that all the time. They are disadvantaged for no fault of their own. The fact is that the reason they are so far behind is directly a result of the decisions that those States made with respect to how much money they want to put forward in State dollars to help the poor in their States. If you look at the chart of the Senator from Florida, the majority of the States that are advantaged, according to him, by the current system are States like New York, Pennsylvania, Michigan, Ohio, California New Jersey--those States who have invested significant State dollars in AFDC, Medicaid, and a lot of other programs that are aimed at helping the poor. They are high-benefit States; they are States that are willing to spend tax dollars to meet a Federal match, to help the poor in their State. Therefore, they have a higher per capita spending rate on the poor than States like Florida, Texas, Arkansas, and the others. So when it comes to them redoing the formulas in a block grant, we look at what States are spending now and what the Federal Government puts in now. What the Federal Government puts in now is based on what the State puts in. It is a match. So the Federal share, yes, in Pennsylvania is higher than it would be if you start all over and say we are going to pay so much for everybody. But, by doing what, you would take Pennsylvania and a program in Pennsylvania that has been established for a long time and has been supported by the State and just cut the legs out from under it to give it to a State who has not been providing those services in the past. How is that fair? If you want to talk about fair, you have a State actually spending dollars, putting forth an effort and putting together a program they believe better meets the needs and is willing to spend money to help the poor, and you are going to create a block grant and take money away from them because they were being better neighbors--I will use that term. I do not think that is fair. The whole premise of the Hutchison formula--Senator Hutchison was the one who worked tirelessly, and I mean tirelessly, because there have been a lot of contentious issues I have dealt with in the area of welfare reform over the past 2 years. I do not want to use too strong of a term, but nothing approaches the animosity that is raised on an issue than when you are talking about dollars for the States back home. That is really where people draw the line. So to be able to come up, as we have done, with a compromise formula that says we want to make sure no one is hurt, that no State is cut, that they are held harmless in the allocation they get from the Federal Government, and we set a separate growth fund for States that are hydro-States to give them money, a separate pot of money, $800 million, almost $1 billion, to use for growth. Florida gets over $100 million of the $800 million in that fund. We try to take care of both. For those who have been doing a good job, spending resources, taking care of the poor in their States, hold them harmless and, at the same time, provide for growth for the other States that, frankly, have not been meeting the national average when it comes to providing services for the poor. We think that is a fair balance. If we had all the money in the world, we would give everything to everybody. But we do not. We do not have enough money to provide the same level for everybody that the State of New York, for example, provides for their beneficiaries. So we have to make, as the Senator from Florida, and I am sure everybody listening, realizes, you have to compromise. This was the compromise we came up with. Is it perfect? Absolutely not. Is it fair from an objective standpoint? I think the Senator from Florida can make the argument that, no, it is not fair. Is it fair given where we had to start? I make the argument that, yes, given the situation we found ourselves in, it is. If we were going to redo this and go back to 1965, instead of developing an AFDC Program, or whatever current revision of the AFDC Program was created, and start all over, would we have done it differently? Absolutely. But we are not there. We are here. We have a history of States that have invested. We have a history of programs. And to go in and just decimate those programs because of this block grant, I think would be tragic to a lot of people and a lot of States, and certainly it would be an enormous hardship on, frankly, the States that are having some of the very worst budgetary times and a lot of economic problems like in the Northeast, in the upper Midwest, and in the case of California and the west coast. So we think what we have done here is a balance given where we had to start. It is not--and I agree with the Senator from Florida--from an objective position, as if we were starting from day one a fair solution. I will not argue that. But what I will argue is that given where we had to start, which is a long history of providing services to the poor, this is the best and the fairest we could come up with given those set of circumstances and the hand we were dealt. So, I do not fault at all the Senator from Florida for standing up, as he has done not only on this bill but last year on several amendments, and articulately advocating for his State and for other States that do not get as much money as they think they deserve. He certainly has a right to do that, and he is certainly justified in doing that. I think what we have done here is to accommodate him and his State as best we can given the circumstances, in providing funds for them to be able to get some more resources. I will anticipate the comment, which is that it is not enough. I cannot even argue that it is not enough. But what I am saying is you would find that the States like Pennsylvania and New York, which are not going to see any growth at all in their allocation, would tell me that is not enough. Nobody has enough. This is a situation where everyone is getting squeezed, and we are hoping that even though they are getting a smaller allocation, that they will be able to take this block grant and be able to redesign this program. That is what this is all about--giving them the flexibility. Yes, less money in a sense, but more flexibility to be able to design a program that more efficiently provides for the poor in their States, that more efficiently transitions people off welfare into productive lives than the current system does, which will save money if they do so in a proper fashion. So, we think there is a good balance between enough money and certainly maximum flexibility to be able to accomplish the purpose without any additional money, or any change in the funding formulas here. I reserve the remainder of my time.

Mr. SANTORUM. We yield back the remainder of our time.

Mr. SANTORUM. Mr. President, I ask unanimous consent that the reading of the amendment be dispensed with.

Mr. SANTORUM. I do not think that would be correct. If the person is no longer eligible for AFDC, what you are suggesting is they should keep working in a low-wage job just for the purposes of keeping Medicaid and not try to get a promotion where you can get benefits and other kinds of things. I am not sure that would be a logical economic move for somebody.

Mr. SANTORUM. Will the Senator yield?

Mr. SANTORUM. Mr. President, from the numbers that I have, I have four States that would be eligible for block grant under the EBT provision, seven States would be under the error rate of under 6 percent. That is out of 53 jurisdictions that are eligible for the program. So I have 11 jurisdictions of 53 that would be eligible today, not 40. Now, I will say that all 53 jurisdictions are eligible, if the States are willing to pay down the error rate. That would be unlikely, we suspect, for any jurisdiction that would want to put up money, State money in advance to get a Federal block grant. So what we are looking at here is 11 States today. Now, the Senator from North Dakota may be anticipating a lot more States going on with electronic benefits transfer, and I know that is being worked on in several States, but as we speak right now we are looking at 11 jurisdictions. So this is not opening the floodgates by any stretch of the imagination. What the Senator also has talked about is the State of Florida being stuck if, in fact, they get hit with a bad economy and on top of that, in the case of Florida, a natural disaster. I suggest that if the Senator from North Dakota looks at his chart, he will see several--I cannot tell the months or years, but an extended period of time where the rate did not go up, the number of people on food stamps did not go up. As I said before, under our program, States would be able to save a portion of the money, up to 10 percent of the annual block grant, and let it go into next year. So they could build up a rainy day fund or a reserve fund for bad times. Now, if you look at the Florida example, and let us say Florida is one of those States that is a little skittish and wanted to get out, before Hurricane Andrew there looked to be a substantial period of time where benefits were increasing fairly dramatically prior to the hurricane. So they certainly would have had ample notice of a rising food stamp roll and been able to get out, if they were concerned, well before the hurricane. That is just using Florida's example. They would have been able to get out during the period of economic downturn, but I think what is more important is that they are able to plan for this by taking the good times--and we have, as in most capitalist economies, economic business cycles. During the good times, they can save some money, and during the bad times, they can draw down that surplus. The Senator from North Dakota also indicated that they would not be able to pay these people benefits; they would run out of money. Well, the Senator knows that hurricane, I think, occurred sometime in the summer, which is only halfway through the year. At that point, they still have half the block grant left. They could move that funding forward and fill that need and then come in at the end, I would suspect, with State dollars to make sure they get to the end of the year. The State can always put up their own money to fill the need and, in fact, having created a plan which creates an entitlement for food stamps, they would be required to come up with their own money. Then they have to make the decision, as I said before, whether they want to continue a program that puts them at some sort of risk. My feeling is that is a decision for the States to make. But to suggest that the State will have no money to pay people food stamps is just not accurate. They will have the money. It will be their own money, not the block grant. But that is the choice they make. The Governors and State legislators are not stupid. They know there are good times and there are bad times, there are natural disasters, and on balance they are going to make a decision that they can run a program so much better than we let them run it today that, given all these exigencies, and they know they exist, they are going to run a better program and save money in the process. That is a decision we leave up to them to make. We trust the Governors in the State. We trust State legislators to be able to sit down and rationally come up with a decision, that they want to take responsibility for this because they can do it better and serve the needs of their people better. I want to give people the option to do it, but there are sufficient safeguards that they have a good program to start, which is why these hurdles are in place, and that they have a good plan and that they implement it, which is why we require HHS approval. And if they screw up, frankly, they have a chance to get out. So we make them have a good plan to start. We require them to submit a good plan to continue, and if they end up having a lousy plan, they can get out. That, to me, is as well thought out as you can possibly get and is as flexible as you can possibly get for an opportunity for States to take control of this very important program that feeds millions of people. I reserve the remainder of my time. Mr. CONRAD addressed the Chair.

Mr. SANTORUM. Mr. President, the Senator from North Dakota keeps mentioning how, under this program, we are not worried about people who are in need of food. The very fact is, States must submit a plan to be approved by HHS to satisfy the Department of Health and Human Services of that very fact, whether we are going to meet the needs. In fact, we require them to specify how they are going to serve everybody, and specific populations. To suggest we have not set up adequate safeguards to make sure, through these block grants, people will be adequately served is not reflective of what is actually in the legislation. Second, you mentioned----

Mr. SANTORUM. Sure.

Mr. SANTORUM. To answer your question, as the Senator from North Dakota knows, the State of Florida during the time of Hurricane Andrew was eligible for disaster assistance, and that covers a variety of things. Having just gone through that in Pennsylvania, a substantial amount of disaster assistance was funneled through the Department of Agriculture, and, in fact, there are programs available for people to meet some of the needs that are there during the time of disaster.

Mr. SANTORUM. We are not attempting nor would I recommend we block grant emergency assistance. So you keep pointing back to one State in one instance and draw a bad case for that. It would be--I am not arguing there would not be a severe strain. But I suggest the Governor of Florida and the State Legislature of Florida knows that occasionally they are hit by hurricanes. It is not like these hurricanes are just, ``Gee, wow, in Florida we had a hurricane. We never see that.'' They see them all the time and they know they can be disastrous, and that should go into their calculation whether they want to go into this in the first place. We are assuming, and I think it is a good assumption, that the Governor and the State legislature are not going to take on this enormous responsibility without having thought through what the different consequences would be, given natural disasters or given economic downturn, and a whole lot of other things. We believe that there still will be States out there that, because of the enormous burden that the Federal Government forces upon them with this program that drives up costs for them and makes their program inefficient, can take the money and take the risk and still do a better job, and they are willing to assume that risk. They do so with eyes open wide. If their eyes were not open, they certainly are open now as a result of our discussion. That if they do not have the money, if they have an economic downturn or disaster, they have to come up with their own State money. I will announce to State Governors now, if you take a block grant under this proposal and run out of money at the end of the year, it is your responsibility. Now everybody has been warned, and they are going to have to make a decision based on what they think is the best thing to do. I think what this whole welfare reform bill is about is trying to get away from the paternalism of the Federal Government and the inefficiency of the Federal Government in trying to micromanage programs out of Washington, DC, for Fargo, ND, and other places. What we are trying to do here is assure, to the extent we can, that States that get involved have good programs. We make sure they have low error rates or high technology to run an efficient system. We ensure that when they take the program, after they now run a good program, that when they opt for a block grant, which is to cut the ties to the Federal program, in fact, take it and let them run it themselves, that they have to submit a plan, which adequately covers all the people we are concerned about, and is approved by HHS. Again, a prudent step to making sure they are not taking the money and spending it on a fleet of Volvos for all the Cabinet Secretaries; that, in fact they are spending it on helping the poor who need food. We have adequate safeguards in here to make sure that the poor who are in need of food assistance get it; that the States run a good operation. We have those safeguards in place. One other thing. The Senator from North Dakota voted for in committee and supported in committee an amendment that was put forward by the Senator from Vermont, the ranking member, Senator Leahy, as a further, frankly, disincentive for these States to take a block grant. Under the old formula, States could either take the 1994 allocation for food stamps or the average of 1992, 1993, and 1994. Senator Leahy, and others on your side of the aisle, were saying, ``Gee, well, with the reductions in food stamp benefits under our bill, that may be a very attractive thing for them to take--take that high figure, since our numbers are going to be coming down.'' So what you added in committee was a provision that said that in no case could either the 1992, 1993, 1994 average or 1994 allocation be higher than the 1997 levels after the reforms have been put in place. So you make it even less tantalizing to go ahead and take a block grant. All I suggest is, we spent a lot of time on this amendment. It has been a good debate and discussion. I hope those who were listening are still listening after an hour of this debate. I think it has been informative. I think what we have seen here is we set very high hurdles; we have not made this to be the most attractive block grant proposal out there. What we have said to States is, ``If you think you can do it better, given these high hurdles to get into this program, we are going to give you the opportunity to do it.'' I think that is only fair to give States the opportunity to run a better program that helps the people in their State.

Mr. SANTORUM. I will be happy to send each Governor a copy of this debate so they will be fully informed as to what they are getting into.

Mr. SANTORUM. Mr. President, I yield back the remainder of our time.

Mr. SANTORUM. Mr. President, I send an amendment to the desk on behalf of Senator Gramm of Texas.

Mr. SANTORUM. This amendment, to my understanding, is an amendment that says that if you are convicted of a Federal drug crime, that if it is a misdemeanor crime you are ineligible for a means-tested benefit for 5 years, if it is a felony you are ineligible permanently. I ask for the yeas and nays on the amendment.

Mr. SANTORUM. Mr. President, if I could just make one quick comment, and that is I think the Senator's example of Mississippi and New York actually illustrates the point as to why the formula in the underlying bill is a fairer formula. To suggest the cost of living to provide for a poor child in Mississippi is the same as it is to provide for a child in Manhattan I think is obvious. It is not the same. The cost of living in a lot of areas in this country is substantially lower than it is elsewhere. California is one of the States that would be harmed by the Senator's amendment. There is a much higher cost of living in the States that are highlighted than in the other States. So there is a disparity, and one of the reasons that States like Pennsylvania, California, and New York have to spend more money is because the Federal grants are set at a flat level, which may be very adequate for Mississippi but certainly not for New York City or San Francisco or Philadelphia and a lot of other places. So the States have had to make up that difference and, in fact, drawn more Federal dollars as a result. There is in a sense, it sounds, an inequity, that a child in Mississippi should be given the same as a child in New York when in a sense the child in Mississippi, to maintain the standard of living, needs less money than a child in New York, where the cost of living is higher. So that is part of what makes these discussions on formulas so incredibly complex and difficult, and very difficult to resolve. But I think we have done the best we possibly can. Mr. President, I yield back the remainder of my time. If the Senator from Florida is finished, if he will yield back his time, we will then move on to the next amendment.