Illinois Addresses Benefits Cliff, Raises Gross Income Limit on SNAP

By Randi Hall

There is overwhelming empirical evidence that the safety net as a whole supports work, particularly for low-income parents. As CLASP Executive Director Olivia Golden recently testified to Congress, people are not held back by too much support for work but by too little. Without income supports to help cover child care and housing costs, low-income parents lack the stability needed to maintain employment. However, in some cases, a small increase in earnings can result in a sharp loss of benefits. These eligibility thresholds, sometimes known as “benefits cliffs,” can reduce incentives for low-wage workers to seek better employment opportunities. The benefits cliff can manifest in various public assistance programs, including the Child Care and Development Block Grant, Medicaid (in states that have not taken up the expansion), and Supplemental Nutrition Assistance Program (SNAP). 

With SNAP, families may experience a benefits cliff when their total income exceeds the “gross income limit.” The state of Illinois has taken an important step toward addressing this issue. Governor Bruce Rauner has signed legislation raising the gross income limit for SNAP eligibility to 165 percent of the federal poverty level, up from 130 percent, using a policy known as broad-based categorical eligibility. The Shriver National Center on Poverty Law estimates that the law will provide access to nutrition assistance to nearly 40,000 working families while bringing in an additional $60 million in federally funded benefits.

As Golden testified, benefit cliffs are ”likely to affect actual work choices, send the wrong signal about our expectations of low-wage workers, and can destabilize workers and their families just when they should be on the path to economic security.” Increasing the gross income limit for SNAP eligibility is a simple way for states to eliminate this cliff. Including Illinois, 28 states and the District of Columbia have already done so. The remaining states should follow their lead to ensure low-wage workers aren’t punished with the loss of benefits when they receive a promotion or additional work hours.