(a) Definitions. For purposes of this section:

(1) Simplified SNAP (S-SNAP) means a program authorized under 7 U.S.C. 2035.

(2) Temporary Assistance for Needy Families (TANF) means a State program of family assistance operated by an eligible State under its TANF plan as defined at 45 CFR 260.30.

(3) Pure-TANF household means a household in which all members receive assistance under a State program funded under part A of title IV of the Social Security Act (42 U.S.C. 601 et seq.).

(4) Mixed-TANF household means a household in which 1 or more members, but not all members, receive assistance under a State program funded under part A of title IV of the Social Security Act (42 U.S.C. 601 et seq.).

(5) Assistance under a State program funded under part A of title IV of the Social Security Act (42 U.S.C. 601 et seq.) means “assistance” as defined in regulations at 45 CFR 260.31.

(b) Limit on benefit reduction for mixed-TANF households under the S-SNAP. If a State agency chooses to operate an S-SNAP and includes mixed-TANF households in its program, the following requirements apply in addition to the statutory requirements governing the S-SNAP.

(1) If a State's S-SNAP reduces benefits for mixed-TANF households, then no more than 5 percent of these participating households can have benefits reduced by 10 percent of the amount they are eligible to receive under the regular SNAP and no mixed-TANF household can have benefits reduced by 25 percent or more of the amount it is eligible to receive under the regular SNAP. Reductions of $10 or less will be disregarded when applying this requirement.

(2) The State must include in its State S-SNAP plan an analysis showing the impact its program has on benefit levels for mixed-TANF households by comparing the allotment amount such households would receive using the rules and procedures of the State's S-SNAP with the allotment amount these households would receive if certified under regular SNAP rules and showing the number of households whose allotment amount would be reduced by 9.99 percent or less, by 10 to 24.99 percent, and by 25 percent or more, excluding those households with reductions of $10 or less. In order for FNS to accurately evaluate the program's impact, States must describe in detail the methodology used as the basis for this analysis.

(3) To ensure compliance with the benefit reduction requirement once an S-SNAP is operational, States must describe in their plan and have approved by FNS a methodology for measuring benefit reductions for mixed-TANF households on an on-going basis throughout the duration of the SFSP. In addition, States must report to FNS on a periodic basis the amount of benefit loss experienced by mixed-TANF households participating in the State's S-SNAP. The frequency of such reports will be determined by FNS taking into consideration such factors as the number of mixed-TANF households participating in the S-SNAP and the amount of benefit loss attributed to these households through initial or on-going analyses.

(c) Application processing standards. Under statutory requirements, a household is not eligible to participate in an S-SNAP unless it is receiving TANF assistance. If a household is not receiving TANF assistance (payments have not been authorized) at the time of its application for S-SNAP, the State agency must process the application using the regular SNAP requirements of § 273.2, including processing within the 30-day time frame, and screening for and provision of expedited service if eligible. The State agency must determine under regular SNAP rules the eligibility and benefits of any household that it has found ineligible for TANF assistance because of time limits, more restrictive resource standards, or other rules that do not apply to SNAP.

(d) Standards for shelter costs. Legislation governing the S-SNAP requires that State plans must address the needs of households with high shelter costs relative to their income. If a State chooses to standardize shelter costs under the S-SNAP, it must, therefore, use multiple standards that take into consideration households with high shelter costs versus those with low shelter costs. A State is prohibited from using a single standard based on average shelter costs for all households participating in an S-SNAP.

(e) Opportunity for public comment. States must provide an opportunity for public input on proposed S-SNAP plans (with special attention to changes in benefit amounts that are necessary in order to ensure that the overall proposal not increase Federal costs) through a public comment period, public hearings, or meetings with groups representing participants' interests. Final approval will be given after the State informs the Department about the comments received from the public. After the public comment period, the State agency must inform the Department about the comments received from the public and submit its final S-SNAP plan for Departmental approval.