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[Federal Register Volume 89, Number 232 (Tuesday, December 3, 2024)]
[Proposed Rules]
[Pages 95724-95727]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-27853]

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Proposed Rules
                                                Federal Register
________________________________________________________________________

This section of the FEDERAL REGISTER contains notices to the public of 
the proposed issuance of rules and regulations. The purpose of these 
notices is to give interested persons an opportunity to participate in 
the rule making prior to the adoption of the final rules.

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Federal Register / Vol. 89, No. 232 / Tuesday, December 3, 2024 / 
Proposed Rules

[[Page 95724]]

DEPARTMENT OF AGRICULTURE

Food and Nutrition Service

7 CFR Part 273

[FNS-2024-0029]
RIN 0584-AF04

Supplemental Nutrition Assistance Program: Thrifty Food Plan Cost 
Adjustment for the Price of Food in Hawaii

AGENCY: Food and Nutrition Service (FNS), USDA.

ACTION: Proposed rule.

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SUMMARY: The Food and Nutrition Service (FNS) is proposing changes to 
Supplemental Nutrition Assistance Program (SNAP) regulations in 
accordance with the Food and Nutrition Act of 2008, which calls for a 
cost adjustment in the Thrifty Food Plan (TFP) for Hawaii to reflect 
the cost of food in Hawaii. The proposal would update the method for 
calculating this cost adjustment to incorporate food prices from 
throughout the State of Hawaii rather than from Honolulu alone, 
ensuring that SNAP benefit allotments better reflect food prices faced 
by participants throughout the State of Hawaii.

DATES: Written comments must be received on or before February 3, 2025 
to be assured of consideration.

ADDRESSES: The Food and Nutrition Service, USDA, invites interested 
persons to submit written comments on this proposed rule. Comments may 
be submitted in writing by one of the following methods:
     Federal eRulemaking Portal: Go to http://www.regulations.gov. Follow the online instructions for submitting 
comments.
     Mail: Send comments to Kevin Meyers Mathieu, Economic 
Advisor, Nutrition Guidance and Analysis Division, Center for Nutrition 
Policy and Promotion, Food and Nutrition Service, U.S. Department of 
Agriculture, 1320 Braddock Place, Fourth Floor, Alexandria, VA 22314.
     Website: Go to http://www.regulations.gov. Follow the 
online instructions for submitting comments.
     Email: Send comments to [email protected].
     All written comments submitted in response to this 
proposed rule will be included in the record and will be made available 
to the public. Please be advised that the substance of the comments and 
the identity of the individuals or entities submitting the comments 
will be subject to public disclosure. FNS will make the written 
comments publicly available on the internet via http://www.regulations.gov.

FOR FURTHER INFORMATION CONTACT: Kevin Meyers Mathieu, Economic 
Advisor, Nutrition Guidance and Analysis Division, Center for Nutrition 
Policy and Promotion, Food and Nutrition Service, U.S. Department of 
Agriculture, 1320 Braddock Place, Fourth Floor, Alexandria, VA 22314, 
703-946-7619 or [email protected].

SUPPLEMENTARY INFORMATION: 

Background

    The Thrifty Food Plan (TFP) is one of four Food Plans the 
Department of Agriculture (USDA or the Department) develops that 
estimates the cost of a healthy diet across various price points--the 
Thrifty, Low-Cost, Moderate-Cost and Liberal Food Plans. The TFP is the 
lowest cost of the four and represents a nutritious, practical, and 
cost-effective diet. The foundation of the TFP is a set of market 
baskets applicable to various age-sex groups that outline nutrient-
dense foods and beverages, their amounts, and associated costs that can 
be purchased on a limited budget to support a healthy diet through 
nutritious meals and snacks at home. The cost of the TFP is based on a 
reference family of four, defined by the Food and Nutrition Act of 2008 
(the Act) (7 U.S.C. 2012(u)) as consisting of a man and a woman twenty 
through fifty, a child six through eight, and a child nine through 
eleven years of age.
    The TFP is used to determine Supplemental Nutrition Assistance 
Program (SNAP) benefit amounts. The Act (7 U.S.C. 2012(u)(4)) requires 
the cost of the TFP in June to serve as the basis for setting maximum 
SNAP benefit allotments in the following Federal fiscal year (October 1 
through September 30). SNAP allotments for households of different 
sizes are calculated proportional to the allotments for the reference 
family of four with economies-of-scale adjustments.
    The Act (7 U.S.C. 2012(u)(2)) also calls for cost adjustments to 
the TFP to reflect the cost of food in Hawaii. Requirements at 7 CFR 
273.10(e)(4)(i) further specify that this cost adjustment reflect the 
price of food in Honolulu. The calculation and implementation of this 
cost adjustment are separate from the reevaluation of the TFP market 
basket; the cost adjustment is not required to be updated when the TFP 
market basket is reevaluated every five years. The extent of regional 
food price variation may vary across different foods and beverages. As 
a result, changes to the underlying TFP market basket resulting from 
the required 2021 TFP reevaluation present an opportunity to update the 
cost adjustment for Hawaii. Although not required, updating the cost 
adjustment for Hawaii following the TFP reevaluation is intended to 
maintain equivalence between the purchasing power of SNAP benefit 
allotments in Hawaii and in the mainland United States.
    Beginning in the early 1970s, TFP costs for Hawaii were calculated 
as the cost of the TFP in the contiguous 48 States and the District of 
Columbia (hereafter referred to as the ``mainland United States'') 
adjusted for the price of food in Honolulu. Evidence suggests that 
Honolulu was used as the basis for the original price-of-food 
adjustments because it was the only location in Hawaii where the Bureau 
of Labor Statistics (BLS) routinely collected food price information. 
FNS subsequently used BLS food price information collected for the 
Consumer Price Index (CPI) as the basis for the TFP cost for Hawaii 
through 1977.
    In 1978, BLS made major changes in the methods for collecting food 
price data in the United States, thereby hindering the construction of 
price-of-food adjustments for Honolulu using BLS data. With the need 
for an alternate data source, FNS incorporated data collected in Hawaii 
from the 1977-1978 Nationwide Food Consumption Survey (NFCS) into a 
reevaluation of the TFP in the early 1980s. The NFCS-based

[[Page 95725]]

Hawaii TFP cost was subsequently updated for inflation using the 
semiannual CPIs for Urban Hawaii through June 2021.
    As directed by Congress in the Agricultural Improvement Act of 
2018, FNS published an evidence-driven reevaluation of the TFP to 
reflect current food prices, food composition data, consumption 
patterns, and dietary guidance. The reevaluation, published in August 
2021,\1\ defined the content of the TFP market baskets for 15 age-sex 
groups, as well as their costs in the mainland United States. After 
accounting for inflation, the reevaluation led to a 21.03 percent 
increase in the TFP cost for the mainland United States.
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    \1\ https://www.fns.usda.gov/cnpp/thrifty-food-plan-2021.
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    FNS used the 21.03-percent increase in the inflation-adjusted cost 
of the TFP in the mainland United States associated with the 2021 TFP 
reevaluation as the basis for a temporary adjustment to the TFP cost 
for Hawaii beginning in June 2021. The application of the temporary 
adjustment effectively held the cost adjustment for Hawaii (i.e., the 
percentage difference between the TFP cost for Hawaii and the TFP cost 
for the mainland United States) constant despite the change in 
underlying market baskets. This TFP cost for Hawaii, inclusive of the 
temporary adjustment, was subsequently adjusted for inflation to 
reflect June 2022 price levels using the CPIs for Urban Hawaii while 
FNS conducted additional analysis of the TFP cost for Hawaii.
    In July 2023, FNS published the Thrifty Food Plan Cost Estimates 
for Alaska and Hawaii report,\2\ which calculated a TFP cost estimate 
for Hawaii based on the most current information available. The report 
detailed the identification of a data source and the development and 
application of a price index to these data in alignment with the 
statutory and regulatory framework. The report was peer reviewed by 
experts at USDA as well as six researchers outside of the Federal 
Government with demonstrated knowledge and expertise in price indexes, 
scanner data, and the TFP. The report provides detailed information on 
the four existing price indexes and the four existing food price data 
sources that FNS considered, as well as FNS' approach for evaluating 
each option. FNS identified Circana (formerly Information Resources 
Inc., or IRI) retail scanner data as the best available data to support 
the calculation of new TFP cost estimates based on sample size; 
applicability to the TFP, 2021; data quality and documentation; 
appropriateness as a price-of-food adjustment; and the applicability to 
future updates and reevaluations. FNS used Circana retail scanner data 
from over 40,000 stores in the mainland United States and 32 stores in 
Honolulu, including sales at these stores for over 11,000 unique food 
and beverage products, to calculate an updated TFP cost estimate for 
Hawaii using a bilateral, fixed-basket price index. FNS used this 
index-based approach to calculate an updated TFP cost for Hawaii rather 
than the optimization model approach used to conduct TFP reevaluations 
because the use of an optimization model would have resulted in the 
creation of a new market basket, which would not align with the Act (7 
U.S.C. 2012(u)(2)), which calls for an adjustment for the cost of food, 
exclusively. The analysis resulted in an updated estimate of the 
percent difference in the cost of purchasing the foods and beverages in 
the TFP, 2021 market basket between Honolulu and the mainland United 
States, which was applied to the cost of the TFP in the mainland United 
States to yield an updated TFP cost estimate for Hawaii. FNS is 
currently transitioning to using the updated TFP cost estimate for 
Hawaii published in the 2023 report as the basis of the maximum SNAP 
allotment in Hawaii.
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    \2\ https://www.fns.usda.gov/cnpp/tfp-akhi.
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    On January 19, 2024, FNS posted a Request for Information (RFI) in 
the Federal Register (89 FR 3633) requesting comments from the public--
including the food industry and research community--to help inform 
future policy and decisions about potentially updating TFP cost 
estimates for the State of Hawaii. Concurrent with its publication, FNS 
conducted extensive outreach to stakeholders in Hawaii to spread 
awareness of and encourage responses to the RFI, including by notifying 
national and local organizations, universities, Federal agencies, and 
every SNAP-approved retailer in the State for which SNAP had a valid 
email address (approximately 510 retailers). The comment period closed 
on March 4, 2024, with FNS receiving a total of 12 comments from a 
Federal agency, an academic, a SNAP participant, three advocacy/non-
profit organizations, an industry association, three retailers (with 
one retailer providing two comments), and one anonymous respondent.
    The comments consistently indicated that food prices are higher in 
the Neighbor Islands than in Honolulu. A key rationale for the higher 
relative prices in the Neighbor Islands provided by the comments is 
that nearly all foods and beverages sold in Hawaii are imported from 
out of State, with these shipments first arriving in Honolulu and then 
being distributed out to the Neighbor Islands. This additional 
distribution step adds to the cost of foods and beverages in the 
Neighbor Islands which is then reflected in retail prices. Several 
comments suggested that many residents of the Neighbor Islands in rural 
and remote areas of the State do not live in proximity to club stores, 
which tend to offer lower unit prices for foods and beverages purchased 
in larger quantities. While club stores operate in urban areas on the 
Neighbor Islands, the comments noted that not all residents of the 
Neighbor Islands are able to consistently access these stores.
    The comments also consistently expressed that a TFP cost for the 
State of Hawaii based on data from Honolulu alone underestimates the 
true cost of a healthy, practical, cost-effective diet in the State. 
Therefore, the respondents argued, current SNAP regulations that adjust 
for the cost of food in Honolulu lead to an inequitable maximum 
allotment level for SNAP participants in the Neighbor Islands.
    FNS proposes to revise regulations at 7 CFR 273.10(e)(4)(i) to 
align with the Act (7 U.S.C. 2012(u)(2)) and base the cost of the TFP 
in Hawaii on an adjustment for the price of food in the State of Hawaii 
rather than an adjustment for the price of food in Honolulu.
    FNS conducted analyses to develop a TFP cost estimate for Hawaii 
that would align with the proposed regulatory framework using the best 
currently available data on food prices. The analysis, which uses the 
same peer-reviewed methodology as the original Honolulu analysis 
published in 2023, is documented in a separately published scientific 
report.\3\ The analysis is also based on Circana retail scanner data, 
which provides sales data from the 32 stores included in FNS' original 
analysis of food prices in Honolulu and 65 additional stores from 
throughout the State of Hawaii. Including these additional stores also 
enables the analysis to consider food prices for approximately 700 (6%) 
more unique food and beverage products.
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    \3\ https://www.fns.usda.gov/cnpp/statewide-tfp-hi-2024.
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    The proposed changes at 7 CFR 273.10(e)(4)(i) would revise the 
regulatory framework for Hawaii's TFP cost without establishing a 
specific dollar value or a specific price-of-food adjustment for 
Hawaii. The Hawaii TFP cost will continue to be based on the

[[Page 95726]]

best available food price data and may be updated in the future at the 
Secretary's discretion. To support continuous quality advancement, FNS 
continues to explore food price data sources for the State of Hawaii.

Procedural Matters

Executive Order 12866, 13563 and 14094

    Executive Orders 12866, 13563, and 14094 direct agencies to assess 
all costs and benefits of available regulatory alternatives and, if 
regulation is necessary, to select regulatory approaches that maximize 
net benefits (including potential economic, environmental, public 
health and safety effects, distributive impacts, and equity). Executive 
Order 13563 emphasizes the importance of quantifying both costs and 
benefits, of reducing costs, of harmonizing rules, and of promoting 
flexibility. This proposed rule has been determined to be not 
significant and was not reviewed by the Office of Management and Budget 
(OMB) in conformance with Executive Order 12866.

Regulatory Impact Analysis

    This rule has been designated as not significant by the Office of 
Management and Budget, therefore, no Regulatory Impact Analysis is 
required.

Regulatory Flexibility Act

    The Regulatory Flexibility Act (5 U.S.C. 601-612) requires Agencies 
to analyze the impact of rulemaking on small entities and consider 
alternatives that would minimize any significant impacts on a 
substantial number of small entities. Pursuant to that review, it has 
been certified that this rule would not have a significant impact on a 
substantial number of small entities.

Congressional Review Act

    Pursuant to the Congressional Review Act (5 U.S.C. 801 et seq.), 
the Office of Information and Regulatory Affairs designated this rule 
as not a `major rule', as defined by 5 U.S.C. 804(2).

Unfunded Mandates Reform Act

    Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), Public 
Law 104-4, establishes requirements for Federal agencies to assess the 
effects of their regulatory actions on State, local and tribal 
governments and the private sector. Under section 202 of the UMRA, the 
Department generally must prepare a written statement, including a cost 
benefit analysis, for proposed and final rules with ``Federal 
mandates'' that may result in expenditures by State, local or tribal 
governments, in the aggregate, or the private sector, of $100 million 
or more in any one year. When such a statement is needed for a rule, 
Section 205 of the UMRA generally requires the Department to identify 
and consider a reasonable number of regulatory alternatives and adopt 
the most cost effective or least burdensome alternative that achieves 
the objectives of the rule.
    This proposed rule does not contain Federal mandates (under the 
regulatory provisions of Title II of the UMRA) for State, local and 
tribal governments or the private sector of $100 million or more in any 
one year. Thus, the rule is not subject to the requirements of sections 
202 and 205 of the UMRA.

Executive Order 12372

    This Supplemental Nutrition Assistance Program is listed in the 
Catalog of Federal Domestic Assistance under Number 10.551 and is 
subject to Executive Order 12372, which requires intergovernmental 
consultation with State and local officials. (See 2 CFR chapter IV.)

Federalism Summary Impact Statement

    Executive Order 13132 requires Federal agencies to consider the 
impact of their regulatory actions on State and local governments. 
Where such actions have federalism implications, agencies are directed 
to provide a statement for inclusion in the preamble to the regulations 
describing the agency's considerations in terms of the three categories 
called for under Section (6)(b)(2)(B) of Executive Order 13132.
    The Department has considered the impact of this rule on State and 
local governments and has determined that this rule does not have 
federalism implications. Therefore, under section 6(b) of the Executive 
Order, a federalism summary is not required.

Executive Order 12988, Civil Justice Reform

    This proposed rule has been reviewed under Executive Order 12988, 
Civil Justice Reform. This rule is intended to have preemptive effect 
with respect to any State or local laws, regulations or policies which 
conflict with its provisions or which would otherwise impede its full 
and timely implementation. This rule/is not intended to have 
retroactive effect unless so specified in the Effective Dates section 
of the final rule. Prior to any judicial challenge to the provisions of 
the final rule, all applicable administrative procedures must be 
exhausted.

Civil Rights Impact Analysis

    FNS has reviewed this proposed rule in accordance with USDA 
Regulation 4300-4, ``Civil Rights Impact Analysis,'' to identify any 
major civil rights impacts the rule might have on program participants 
on the basis of age, race, color, national origin, sex or disability. 
After a careful review of the rule's intent and provisions, FNS has 
determined that this rule is not expected to affect the participation 
of protected individuals in SNAP.

Executive Order 13175

    Executive Order 13175 requires Federal agencies to consult and 
coordinate with Tribes on a government-to-government basis on policies 
that have Tribal implications, including regulations, legislative 
comments or proposed legislation, and other policy statements or 
actions that have substantial direct effects on one or more Indian 
Tribes, on the relationship between the Federal Government and Indian 
Tribes, or on the distribution of power and responsibilities between 
the Federal Government and Indian Tribes.
     We are unaware of any current Tribal laws that could be in 
conflict with this rule.

Paperwork Reduction Act

    The Paperwork Reduction Act of 1995 (44 U.S.C. Chap. 35; 5 CFR 
1320) requires the Office of Management and Budget (OMB) approve all 
collections of information by a Federal agency before they can be 
implemented. Respondents are not required to respond to any collection 
of information unless it displays a current valid OMB control number.
    This rule does not contain information collection requirements 
subject to approval by the Office of Management and Budget under the 
Paperwork Reduction Act of 1994.

E-Government Act Compliance

    The Department is committed to complying with the E-Government Act, 
to promote the use of the internet and other information technologies 
to provide increased opportunities for citizen access to Government 
information and services, and for other purposes.

List of Subjects in 7 CFR Part 273

    Administrative practice and procedure, Supplemental Nutrition 
Assistance Program, Thrifty Food Plan.

    Accordingly, 7 CFR part 273 is proposed to be amended as follows:

[[Page 95727]]

PART 273.10--DETERMINING HOUSEHOLD ELIGIBILITY AND BENEFIT LEVELS

0
1. The authority citation for part 273 continues to read as follows:

    Authority: 7 U.S.C. 2011-2036.

0
2. In Sec.  273.10, amend paragraph (e)(4)(i) to remove the word 
``Honolulu'' and adding in its place ``Hawaii''.

Tameka Owens,
Acting Administrator and Assistant Administrator, Food and Nutrition 
Service.
[FR Doc. 2024-27853 Filed 12-2-24; 8:45 am]
BILLING CODE 3410-30-P
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