Kansas Moving Forward With $25 ATM Withdrawal Limit For Welfare Recipients

| by Jared Keever

Kansas is planning to move forward with a controversial measure that would limit ATM withdrawals by welfare recipients to $25 per transaction. 

But the measure might violate federal law, according to a recent McClatchy article in The Wichita Eagle. 

Republican supporters of the measure argue that the daily $25 cap will ensure welfare recipients spend the money they receive from the government responsibly, The Christian Science Monitor reported in April. 

“We’re trying to make sure those benefits are used the way they were intended,” state Sen. Michael O’Donnell was quoted as saying in The Topeka Capital-Journal. “This is about prosperity. This is about having a great life.”

The state currently receives $102 million annually in federal block grants for the administration of the Temporary Assistance for Needy Families, or TANF, program, which is often referred to as welfare. 

The Social Security Act states that individuals receiving such funds must have “adequate access to cash assistance” with “minimal fees or charges.”

The current measure would include a $1 fee that would be collected per transaction, not including bank ATM fees. 

That could add up to $30 in fees for a single mother with two children wanting to withdraw $200 in cash, according to The Washington Post. To withdraw $400 — the typical sum such a family would receive — could result in the mother paying well over 10 percent of allotted funds in fees. 

If those fees are determined to violate the Social Security Act’s provisions, the state could be in jeopardy of losing its annual block grants, according to The Eagle. 

The Kansas Legislature passed a bill earlier this year that could either raise the $25 limit or do away with it entirely. Republican Gov. Sam Brownback signed the so-called fix-it bill into law in June. 

But a newly revised version of the state’s welfare plan still includes the $25 limit, according to The Eagle article. 

Kansas Department for Children and Families spokeswoman Theresa Freed told The Eagle that the revised plan reflects the limit that was passed and signed into law. 

The fix-it legislation does not give Children and Families Secretary Phyllis Gilmore “unilateral authority to change the limit,” Freed said. 

Such a change must be accompanied by “guidance” from the federal government, the spokeswoman asserted. 

“There have been conversations, but we’ve received no guidance,” she said. 

The $25 limit is expected to take six to 12 months to implement and be put into effect. 

Sources: McClatchy via The Wichita Eagle, The Christian Science Monitor, The Topeka Capital-Journal, The Washington Post / Photo credit: OTA Photos/Flickr