USDA threatens to pull funding over NC food stamps problems

Federal administrators say that, despite assurances, the state has failed to fix problems administering its food stamps program.

Posted 9:57 p.m. Jan 9, 2014 — Updated 1:15 a.m. Jan 10, 2014

RALEIGH, N.C. — The North Carolina Department of Health and Human Services has failed to make promised changes to fix problems with its food stamps program, according to federal regulators.

The state and federal government share the administrative costs associated with the program, but officials with the U.S. Department of Agriculture say they will withdraw federal funding if the problems aren't corrected soon.

In a letter dated Dec. 11, USDA Regional Administrator Donald Arnette says the state has failed to answer questions from federal officials and has not followed through on steps laid out by the USDA, which oversees the program.

"The data provided by DHHS indicates that more than 20,000 households continue to experience significant delays with Supplemental Nutrition Assistance Program (SNAP) applications and re-certifications," Arnette wrote, adding that 6,000 of those households waited more than three months to receive benefits.

"These delays are completely unacceptable and a serious failure on the part of North Carolina," Arnette wrote.

The letter was part of a series of documents released Thursday by DHHS and the USDA. It contradicts testimony DHHS officials gave to state lawmakers in October and November that indicated the food stamps enrollment system, known as NC FAST, had initially experienced problems this summer but was working mostly as it should by the fall.

"DHHS has already taken steps to ensure that applications and re-certifications are processed in a timely fashion and submitted a corrective action plan to address the concerns raised by the USDA," DHHS Deputy Secretary Sherry Bradsher said in a statement released with the state's documents. "DHHS continues to work closely with county social services agencies and are monitoring our progress weekly. Our work will continue until all clients are receiving benefits in a timely manner."

In a statement late Thursday, a USDA spokesperson said the SNAP benefits were one of the country's strongest defenses against hunger and critical for low-income families.

"USDA expects North Carolina to take whatever steps are necessary to fix these system issues as quickly as possible and deliver benefits to eligible clients in a timely fashion," the statement said.

Lawmakers said they were surprised by the news Thursday afternoon, saying that they had been told NC FAST was no longer a problem.

"I was under the impression that it had stabilized and things were getting on track," said Sen. Jeff Tarte, R-Mecklenburg, a member of the legislative committee that oversees information technology. "That's just embarrassing at a minimum. This is one we need to jump on."

Letters show persistent problems

Correspondence between DHHS and the USDA about problems with NC FAST began on Sept. 4, when the federal agency noted several areas that require urgent attention from the State."

Among these urgent problems was the department's inability to quantify its backlog of food stamps cases that left North Carolina families without assistance for months. The USDA estimated that almost 70,000 food stamps cases were overdue across the state and demanded that DHHS leaders confirm the exact number and how long they were overdue.

In her response on Sept. 20, DHHS Secretary Aldona Wos failed to do that, instead writing that "some counties" struggled to complete applications in a "timely manner." She also noted that a DHHS "SWAT team," deployed to tackle the backlog, had by then completed more than 1,500 cases, with more to come.

"The SWAT team has been an important strategy to help counties, but the weekly reports for the work of the SWAT team does not provide the information we originally requested," the USDA wrote back on Nov. 6.

The federal agency also took issue with the DHHS response to questions about technical glitches in July and August that put caseworkers in county human services agencies way behind. A WRAL News report in December showed DHHS downplayed those technical problems to the frustration of county workers, who eventually discovered on their own that a compatibility issue with Internet Explorer browser was to blame.

Records: DHHS downplayed food stamp issues

After another response from Wos on Nov. 20 still failed to satisfy the federal agencies, the warnings grew more dire.

"We have grave concern for the low income people of North Carolina who are waiting for assistance," Arnette wrote in his Dec. 11 letter. "DHHS must work aggressively to correct the issues that are impacting the ability of North Carolina citizens to purchase food."

Those comments came weeks after Wos told WRAL News that NC FAST was "in a very good place right now" and that inadequate preparation – not technical issues – caused most of the problems.

"Whatever issues came up, we just figured out a creative way of resolving them," Wos said.

A few weeks later, Wos responded with a corrective action plan, noting that the department had already been working on fixes before receiving the federal agency's last letter.

"We want to assure you that we will continue to implement corrective actions to resolve the concerns raised in your most recent letter," Wos wrote.

Lawmakers call for secretary's ouster

The continued problems with NC FAST, coming on the heels of DHHS' admission that it mailed identification cards containing the personal information of about 49,000 Medicaid recipients to the wrong people, intensified calls for Wos to step down.

"It's just one mistake after another, and they just start piling on here," said state Sen. Mike Woodard, D-Durham. "It doesn't give me a lot of confidence in their ability to continue running these critical human service programs."

Woodard said he also worries about the cost of those mistakes. In 2012, the federal government fined Alaska $1.7 million for violating patient privacy.

"I think it's time for the governor and the secretary to step up and say, 'This is our mistake. This is what we're doing to fix it,'" he said. "Frankly I think they need to look at the kind of staffing they have there, and they need to make some changes there."

Reps. Beverly Earle, D-Mecklenburg, and Michael Wray, D-Northampton, who both sit on the Legislative Oversight Committee for Health and Human Services, said Wos has shown "inept leadership" and is hindering DHHS operations.

"Secretary Wos has created more problems than she has solved," Earle and Wray said in a joint statement. "The department needs a competent leader who can direct public policy and work with the legislative leadership to address the critical needs facing those who are served by the Department of Health and Human Services."

Tarte, an IT expert, said he still has confidence in Wos and other DHHS leaders, but he agreed that something has to change.

"This nonsense has got to stop. It's really out of control," he said. "It's death by 1,000 cuts. It's time ... to take accountability, get procedures and processes in place that prevent a lot of this activity from occurring going forward."

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