Food Stamp Snafu May Doom Portland Neighborhood Market
Feds fine Fresh Approach $5,700 for about $10 of non-food EBT sales
Federal authorities have pulled the food-stamp retail license of a mom-and-pop neighborhood market in Portland’s West End due to what appears to be an administrative snafu at the Department of Agriculture’s Food and Nutrition Service (FNS), which administers the Supplemental Nutrition Assistance Program (SNAP). Congresswoman Chellie Pingree’s office is attempting to rectify the situation, but without a speedy resolution, the market’s owners say they may not make it through the month.
Late last summer or fall, an undercover FNS compliance agent allegedly bought non-food items with an EBT card during two visits to Fresh Approach, a small grocery store, deli and butcher shop across from Reiche Community School. Chet Knights, who owns the market with his wife Peg, said that in addition to some eligible food items, the agent was mistakenly allowed to purchase a box of tissues and some dishwashing liquid on the first visit, and some paper towels and toilet paper during a second sting operation. Knights estimates the items amounted to maybe $10 in sales, combined.
Fresh Approach was fined $5,700 for the violations, their first such offense, and the FNS agreed to accept payment in monthly installments of about $1,000 (at an additional 4 percent interest rate).
The first payment was initially scheduled to be made on Feb. 2, but Peg Knights contacted the FNS and arranged with them to have that date moved to Feb. 10, the same day EBT credits are issued. The market operates on a tight budget, Chet Knights said, and paying the installment so soon after rent and credit-card fees are due would have been a problem.
Now they’ve got an even bigger problem.
Last week, the FNS revoked Fresh Approach’s license to conduct EBT transactions because the installment payment was not received on Feb. 2. Peg Knights contacted the FNS regarding their earlier agreement to extend the due date, but different officials there denied an extension had been granted. It seems “the person across the hall didn’t talk to the person on the other side of hall,” Chet Knights said.
The couple paid the February installment last week anyway, but the FNS still refuses to restore their license. Come Monday, the hundreds of low-income people in Portland who rely on Fresh Approach for food will be out of luck, and the market will be on the brink of closing after decades doing business on the peninsula. Valentine’s Day would mark Fresh Approach’s 33rd anniversary.
EBT sales account for about a quarter of the store’s revenue, Chet Knights said. He mentioned one customer who buys a tunafish sandwich almost every day with an EBT card, and said people receiving food assistance come from Biddeford, Brunswick and beyond for the bulk meat-package deals the market offers.
To lose their EBT license “after thirty-three years playing by the rules is devastating,” Chet Knights said.
In accordance with FNS regulations, Fresh Approach’s cashiers are trained and routinely reminded to exclude non-food items from EBT transactions. “We made a mistake and we own it,” said Knights. “Should we be punished? Yes, we should we punished. But should we be put out of business? No.”
In addition to tobacco, alcohol and heated prepared foods, the list of prohibited EBT items includes pet food, diapers, feminine hygiene products, and soap. A review of license-revocation decisions on the FNS website indicates nearly all are the result of intentional fraud involving many thousands of dollars.
Big grocery stores and convenience-store chains typically have bar-code systems that automatically separate non-food items from EBT transactions. Fresh Approach has a price-tag gun and “a cash register from 1975,” Chet Knights said with a rueful chuckle.
As a result of that technology gap, mom-and-pop neighborhood markets and corner stores appear to be the primary targets of this type of enforcement. The Washington, D.C.-based law firm Olsson Frank Weeda Terman Matz notes on its site that the FNS issues violation letters to “more than 2,000 small grocery and convenience stores each year alleging that they have engaged in illegal trafficking in SNAP benefits,” a term that includes the sale of prohibited items.
Government spending on SNAP benefits more than doubled from 2019 to 2023, when it amounted to $145 billion and the program served over 42 million people, more than 12 percent of the U.S. population. The increase has drawn scrutiny from conservative policymakers who decry reports of corruption and theft involving the program. Yet the sale of non-food items didn’t make “The Food-Stamp Fraud Top Ten” compiled by Chris Edwards of the Cato Institute in an article published by National Review in 2023. Edwards’ list includes practices such as the sale of EBT cards for cash, reselling food bought with EBT cards, and phishing and card skimming schemes.
Officials at the FNS are deaf to the Knights’ appeals. “It’s just not open for discussion. There’s nobody to talk to,” Chet Knights said. “They’re very unsympathetic.”
The couple reached out to Pingree’s office for assistance and were told an effort will be made to cut through the red tape and remedy the situation. But “nothing’s going to happen overnight,” Chet Knights said, and without EBT sales, “I simply will not survive. … I don’t know how long I’m gonna last.”
UPDATE: Two neighbors have launched a GoFundMe campaign, with the market’s blessing, to raise funds to get them through until the USDA’s error is fixed.