Advocate for poor lauds replacing 'smart cards'

The new card system will go into effect next spring.
COLUMBUS -- An advocate for the poor says she's pleased that Ohio is dropping so-called "smart cards" to distribute food stamp benefits in favor of a card that could be widely used at credit card readers in most grocery stores.
"It's the technology that most consumers are familiar with," advocate Lisa Hamler-Fugitt said Monday.
"Also, it's going to reduce the cost significantly," said Hamler-Fugitt, executive director of the Ohio Association of Second Harvest Foodbanks.
The Ohio Department of Job and Family Services said Affiliated Computer Services Inc. of Dallas has won the competitively bid contract to operate the electronic food stamp benefits program.
The company, one of three that bid on the project, will take over the system next spring at a cost of about $6.2 million a year split between the state and federal governments, ODJFS said. Right now, the state and federal government spends about $29 million annually to operate the system.
Out with the old
The so-called "smart card" is a plastic card with a computer chip embedded in it capable of maintaining individual account information.
Ohio has about 10,000 machines statewide at groceries and other locations capable of reading the information, ODJFS said.
But critics of the system have said it was complicated and limited. In some stores, the machines were only available at certain checkout lines.
Also, the computer chips were easily damaged, Hamler-Fugitt said.
The new system, which will require new cards to be provided next spring, will rely on magnetic strip cards -- similar to the technology used in bank debit cards or credit cards.
"The advantage to the consumer will be they won't have to seek special lines," said Jon Allen, an ODJFS spokesman. "People will be able to go into every lane."
Projected cost
The total estimated cost of the project is about $45 million, ODJFS said. The contract is expected take effect in July and is renewable through 2013 based on satisfactory performance and other factors, ODJFS said.
ACS, eFunds and JPMorgan Electronic Financial Services, which operates the state's current benefits distribution system, submitted proposals.
Allen said ACS was the lowest bidder.
ACS employs more than 50,000 people and has offices worldwide including Ohio, ODJFS said. The company operates food stamp benefits systems in six states and is a subcontractor on electronic benefit transfer projects in four others, the state said.
According to ODJFS, in April, 1,005,898 Ohioans received a total of $95.4 million in food stamp benefits that month.
While benefits are funded entirely by the federal government, administrative costs to run the program are split between the federal government and the state, ODJFS said.

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