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Electronic Benefits Transfer in the Public Sector
Over the past several years, federal and state agency managers have been asked to streamline their personnel, improve their business processes, and save money without significantly reducing services to the public.
This trend has been dubbed "doing more with less." The downsizing of state and federal government is being followed by a new effort to move the delivery of public benefits for services, goods, and money from paper-based to electronic-based processes. In simple terms, benefit programs supported by the federal and state government should be managed and transferred to recipients via electronic means. This method of benefit management is called electronic benefits transfer (EBT). EBT can be defined as any electronic method of providing service to a public recipient.
Since its first government sector application in 1984, EBT has quickly become a pressing issue for public sector managers around the country. The success of early pilot programs such as the State of Texas' Lone Star Card prompted the federal government to pass legislation requiring all states to implement an EBT system for food stamps by the year 2002. Now, 48 out of the 50 states operate an EBT-based food stamp program or plan to launch one soon. While Temporary Aid to Needy Families (TANF) and food stamp benefits stand out as the services most widely associated with EBT, innovative government agencies have already begun moving forward with EBT applications offering a wide range of government services and benefits. Automated electronic systems offer the potential of delivering information, services and benefits at significantly lower cost than existing paper systems. The pressure to utilize this technology and the recent emergence of new EBT technologies place an unprecedented task before government agencies: how to choose the best technological systems to improve public sector business practices. The fact that existing EBT models are still evolving and that new ones are appearing every day makes this challenge especially difficult.
There are several types of EBT: automated bank deposit, magnetic stripe cards, "smart cards," and hybrid cards, to name a few examples. To facilitate the migration of Texas benefit programs to EBT, the LBJ School of Public Affairs at UT has collaborated with the State of Texas' Office of the Comptroller to give public sector managers a better understanding of current and proposed EBT models and the advantages and disadvantages of each. A publication prepared by the 1997-98 LBJ School Policy Research Project (PRP) describes the present and future trends of EBT and identifies barriers to EBT and guidelines for implementing an EBT system. The report closes with a set of recommendations for the issues that government leaders and managers should consider when deciding on the most appropriate EBT system to implement. A description of each type of EBT and links to other programs throughout the United States are presented as part of this Web site.
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