TRANSKRIPTIO 🔗
WEBVTT
00:00:00.800 --> 00:00:07.440
Welcome to Checkout GR, a bonus episode of the Women Grocers of America podcast, Grocery from Her Seat.
00:00:07.599 --> 00:00:14.720
Your host, Kristen Popp, speaks with political influencers to understand new legislation, policy debates, and emerging trends.
00:00:14.960 --> 00:00:22.879
Together, Kristen and her guests explore how we can collectively be informed, take part in the conversation, and shape policies impacting our industry.
00:00:23.120 --> 00:00:27.039
Now, enjoy your bonus episode of Grocery from Her Seat.
00:00:27.440 --> 00:00:36.880
I'm your host, Kristen Popp, and today I have the opportunity to sit down with Stephanie Johnson with the NGA National Groceries Association to chat on all things government.
00:00:37.039 --> 00:00:41.759
So, Steph, can you go ahead and uh introduce yourself and your role with NGA?
00:00:42.479 --> 00:00:42.719
Sure.
00:00:42.799 --> 00:00:43.520
Thank you, Kristen.
00:00:43.679 --> 00:00:45.520
I'm so excited to join you here today.
00:00:45.679 --> 00:00:47.439
Um, my name is Stephanie Johnson.
00:00:47.520 --> 00:00:52.799
I'm the group vice president of government relations here at the National Grocers Association.
00:00:53.039 --> 00:01:04.239
So I help run our government relations team, which helps that, which means that we help liaise with Congress and the administration on all things grocery policy.
00:01:04.640 --> 00:01:10.640
And Stephanie, you know, you and your team do a fantastic job and uh a lot of moving parts happening in Washington.
00:01:10.799 --> 00:01:16.079
So appreciate all the work and uh time and effort that you guys put into everything that you do there.
00:01:16.159 --> 00:01:17.519
I know you guys make a big impact.
00:01:17.760 --> 00:01:20.560
And so I'm gonna go ahead and dive right in and ask some questions.
00:01:20.719 --> 00:01:24.319
We just concluded the longest government shutdown in US history.
00:01:24.560 --> 00:01:31.120
Before we get into the specifics of that, how did it happen and what happens when the government shuts down?
00:01:32.319 --> 00:01:32.719
Sure.
00:01:33.040 --> 00:01:37.040
So this was a very interesting time to be in Washington.
00:01:37.200 --> 00:01:40.560
Like you said, this was the longest government shutdown of all time.
00:01:40.799 --> 00:01:46.319
The fiscal year for the federal government runs from October 1st to September 30th each year.
00:01:46.480 --> 00:01:52.400
And so Congress has to essentially fund the functions of the government by September 30th.
00:01:52.560 --> 00:01:56.079
And they did not do that this year, which led to a shutdown.
00:01:56.480 --> 00:02:05.120
The politics that led to this shutdown are basically the Republicans have the House, the Senate, and the presidency.
00:02:05.200 --> 00:02:10.319
And so Democrats have had very little leverage this year to get any of their priorities through.
00:02:10.560 --> 00:02:21.120
And what the Democrats tried to use is this must-pass funding bill for the government to secure some of their wins on health care that they've been trying to fund.
00:02:21.280 --> 00:02:30.560
And so the government was shut down for 43 days, and the Democrats ultimately did not get a resolution on the healthcare issues that they were looking for.
00:02:30.879 --> 00:02:41.840
So during this shutdown, what happened was basically each department goes through and looks at who their essential staff are, who needs to stay there to keep the lights on.
00:02:42.319 --> 00:02:47.520
Then they send everyone else home on a furlough, and then all the programs stopped running.
00:02:47.680 --> 00:02:59.039
And so, because the government was shut down for so long, programs that normally have enough money to carry them during short shutdowns, like a few days or a few weeks, they ran out of money.
00:02:59.120 --> 00:03:00.879
And that includes WIC and SNAP.
00:03:01.039 --> 00:03:11.199
And so the USCA was able to move money around to cover the cost of WIC, but they were not able or willing to move money around to cover the cost of SNAP.
00:03:11.360 --> 00:03:16.560
And so this led to SNAP benefits being turned off for the first time in the program's history.
00:03:16.800 --> 00:03:26.319
So big impact, and obviously that impacts the grocers in a significant way, some more than others, depending on the demographic or the location of the stores that they operate.
00:03:26.479 --> 00:03:32.080
But can you kind of dive into that a little bit further and what other impacts grocers saw from the shutdown?
00:03:32.400 --> 00:03:32.639
Sure.
00:03:32.719 --> 00:03:36.960
So you're so correct in that you know it really depends where the store is located.
00:03:37.120 --> 00:03:41.680
We have members that have very few SNAP purchases, like less than 1%.
00:03:42.159 --> 00:03:50.080
But we also have members in um lower income areas where they have 50, 60, 70% SNAP purchases.
00:03:50.159 --> 00:03:55.840
And so when SNAP was turned off, that was a very concerning place for those members.
00:03:56.080 --> 00:04:01.439
Um, and because SNAP has never been turned off before, no one was quite sure how it would work out.
00:04:01.520 --> 00:04:03.759
And that included the USDA.
00:04:04.000 --> 00:04:17.759
The USDA determined, um, I think it was Friday night, October 31st, that they were not going to be able to fund SNAP starting November 1st, and that they were not going to be able to use their contingency fund to support SNAP.
00:04:18.000 --> 00:04:40.160
And so they were sued by a few different groups, and that kicked off this day by day, hour by hour, back and forth chaos that we all experienced with some courts saying that they had to push out partial benefits, others saying they could push out the full benefits, and then other courts stopping all the action altogether.
00:04:40.399 --> 00:04:46.399
So some states ended up releasing the full benefits while others ended up pushing out partial benefits.
Load full transcript
00:04:46.480 --> 00:04:49.360
And again, this just led to confusion all around.
00:04:58.240 --> 00:05:08.319
We kept a list of what each state was doing and really did our best to keep folks apprised of the changing situation, especially because it was changing so quickly.
00:05:08.639 --> 00:05:11.199
It was definitely changing very rapidly.
00:05:11.279 --> 00:05:16.160
And so to try and navigate that was a new opportunity that we haven't had to face.
00:05:16.240 --> 00:05:22.000
But how did you see independent grocers step up and serve the communities during this crisis time?
00:05:22.319 --> 00:05:24.319
We have so many wonderful members.
00:05:24.480 --> 00:05:33.920
Some of them donated money and some very large amounts of money to food banks, while others were able to give out gift cards to low-income households.
00:05:34.160 --> 00:05:41.680
And really, each of our members is so involved in their communities, they were able to find the right solution that worked best for their shoppers.
00:05:41.759 --> 00:05:49.920
So it was really impressive to see what our grocers were able to do and step up and really support folks during this difficult and confusing time.
00:05:50.319 --> 00:05:55.680
So you touched on as the shutdown happened, it's looked at what's needed to keep the lights on.
00:05:55.759 --> 00:06:02.160
And so obviously, some of those functions of government shutdown or pause during that shutdown time.
00:06:02.319 --> 00:06:07.519
What do you think will be some of the longer-term impacts from this specific shutdown?
00:06:08.480 --> 00:06:15.120
So I think the shortest long-term impact is really gonna be SNAP authorizations, right?
00:06:15.279 --> 00:06:20.319
43 days without any SNAP authorizations has created quite a significant backlog.
00:06:20.480 --> 00:06:32.399
And so for anyone that has new stores coming up or maybe open during that time, you know, they're gonna have to wait a longer period than they normally would to get their authorization approved, unfortunately.
00:06:32.560 --> 00:06:39.439
And so as the USCA works through that backlog, we'll do our best to try to shepherd authorizations through.
00:06:39.519 --> 00:06:44.800
But again, they're 43 days behind and it can take several months for them to catch up.
00:06:45.040 --> 00:06:54.720
I think the biggest overall long-term impact that we're gonna see is a lack of trust in the program by the USCA, by retailers, and by participants.
00:06:54.959 --> 00:06:58.160
I think everyone kind of got burned in this process.
00:06:58.480 --> 00:07:06.160
And I hope that we're able to all learn from this as a community and an industry and be prepared if this ever happens again.
00:07:07.920 --> 00:07:11.519
There was really no plan to understand how to navigate it.
00:07:11.680 --> 00:07:15.439
So should we end up in the space again, what does that look like?
00:07:15.519 --> 00:07:18.240
And is this something that you think could happen again?
00:07:18.560 --> 00:07:21.680
Yes, so this is something that can definitely happen again.
00:07:22.319 --> 00:07:27.519
The reason it's possible is because SNAP is what's called an appropriated entitlement.
00:07:27.759 --> 00:07:34.000
So that means that everyone that is eligible for SNAP is entitled to those benefits.
00:07:34.240 --> 00:07:42.160
Similar to Social Security and Medicare, there are specific eligibility requirements, and if you meet those requirements, you're entitled to that benefit.
00:07:42.399 --> 00:07:46.639
But unlike Social Security and Medicare, SNAP is appropriated.
00:07:46.720 --> 00:07:52.560
So that means that every year Congress looks at how much money SNAP needs and they give SNAP that money.
00:07:52.720 --> 00:07:58.560
Whereas Social Security and Medicare are they just automatically get funded through mandatory funding.
00:07:58.639 --> 00:08:07.040
And so Congress never really has a chance to review the expenses, which is why you know there's a lot of concern about the spending in those programs.
00:08:07.199 --> 00:08:13.040
But all of these are entitlement programs, and so folks are entitled to the benefits if they're eligible.
00:08:13.759 --> 00:08:21.839
But I'm really hopeful that the government is able to work together and avoid issues like this in the future, especially because SNAP is so important, right?
00:08:22.000 --> 00:08:29.759
Food is foundational to functioning every day, and so we really want to make sure that folks that need it are able to eat.
00:08:30.160 --> 00:08:34.080
Stephanie, earlier this year, Congress passed the One Big Beautiful Bill Act.
00:08:34.240 --> 00:08:39.919
Included in the bill were some pretty drastic changes to SNAP funding and the way the program is administered.
00:08:40.240 --> 00:08:44.000
Could you go through these changes and what their impact on the industry will be?
00:08:44.240 --> 00:08:44.480
Sure.
00:08:44.639 --> 00:09:04.720
The One Big Beautiful Bill Act, also known as OB3 or HR1, it's going by a lot of different names here in Washington, made kind of two big buckets of changes to SNAP, impacts to SNAP sales, and policies that won't impact SNAP sales.
00:09:04.879 --> 00:09:12.480
The biggest section of the bill that will more directly impact SNAP sales will be from the changes in eligibility.
00:09:12.639 --> 00:09:27.759
They made four different changes in eligibility in the one big beautiful bill, and that those changes are work requirements, internet deductions, utility deductions, and then what legal immigrants are able to access SNAP.
00:09:28.000 --> 00:09:42.320
Together, those changes will remove about$90 billion from the program by um removing participants from the program that should decrease SNAP sales around 9% over the next 10 years.
00:09:42.559 --> 00:09:43.840
So that's those are estimates.
00:09:44.000 --> 00:09:47.200
It'll really depend on where your store is located.
00:09:47.519 --> 00:09:51.200
But we are gonna see reductions in SNAP sales over
time.
00:09:51.519 --> 00:09:55.360
The rest of the changes really impact how the program is funded.
00:09:55.519 --> 00:10:03.840
And what the federal government did is they shifted significant portions of the SNAP costs to states.
00:10:04.080 --> 00:10:08.559
And so states are gonna have to figure out how to come up with this money.
00:10:08.720 --> 00:10:16.159
So that means states are gonna have to shift their state budgets and try to find a lot of extra money to fund this program.
00:10:16.399 --> 00:10:24.080
For folks that want to learn a little bit more, I have a blog summarizing this bill and its impacts to SNAP on the NGA website.
00:10:24.240 --> 00:10:28.639
If you want to take a deep dive, because we spend a lot of time with this bill and there's a lot in there.
00:10:28.960 --> 00:10:31.200
There's definitely a lot to unwind in there.
00:10:31.360 --> 00:10:39.840
In addition to the changes at the federal level, we've always seen also seen numerous states apply for SNAP restriction waivers, and a dozen have been approved.
00:10:39.919 --> 00:10:47.120
Can you walk us through what these waivers look like and and do and how NGA is preparing grocers for their implementation?
00:10:47.519 --> 00:10:47.759
Sure.
00:10:48.000 --> 00:10:51.519
Another big issue we're facing in SNAP is these restrictions.
00:10:51.759 --> 00:10:56.000
12 states have had their SNAP restriction waivers approved.
00:10:56.159 --> 00:11:02.240
That means that states are going to limit what foods SNAP participants can buy with their benefits.
00:11:02.399 --> 00:11:13.120
So unfortunately, each state has a different definition for which foods they are planning to exclude from the program, but most of them center around soda and candy.
00:11:13.360 --> 00:11:16.799
We've created a SNAP waiver tracker on our website.
00:11:16.879 --> 00:11:27.120
So if you go there, you can take a look at the states that you operate in, what the implementation date is, what the food definitions are, and any specific impacts to grocers.
00:11:27.360 --> 00:11:30.159
We are updating that tracker almost every single day.
00:11:30.399 --> 00:11:34.720
We're also going to be uploading resources as they're released.
00:11:34.799 --> 00:11:41.360
So whether that's a UPC list or signage for retailers, and we're going to have links for those things on there.
00:11:41.600 --> 00:11:51.759
And we're also working to help develop a UPC list for folks so they're able to better or more easily implement these restrictions.
00:11:52.000 --> 00:12:04.320
This has been a place where we've been incredibly active and trying to work with state associations and states directly to limit the harmful impacts of these policies as much as possible for our members.
00:12:04.639 --> 00:12:09.440
Well, and you mentioned the definitions change, which presents its own challenge.
00:12:09.600 --> 00:12:22.720
And then when you have to position a cashier to notify a SNAP eligible participant that something that they have doesn't qualify, that can also cause a lot of different opportunities, to say the least.
00:12:22.879 --> 00:12:36.159
So just another significant impact to the grocers that we need to be paying attention to and understand and realize how that's going to impact the end user at the checkout because it definitely does have that impact.
00:12:36.480 --> 00:12:43.120
So kind of shifting here a little bit, I want to get your two cents, no pun intended, on something that's been all over the news lately.
00:12:43.279 --> 00:12:44.399
Uh, the penny.
00:12:44.559 --> 00:12:51.039
So despite the minuscule size of the coin itself, the penny shortage looms large over retail.
00:12:51.200 --> 00:12:53.279
Can you explain how this happened?
00:12:54.399 --> 00:12:54.799
Sure.
00:12:55.039 --> 00:13:01.600
So um over the years, different presidents, different members of Congress, everyone's talked about getting rid of the penny.
00:13:01.679 --> 00:13:05.039
Um, but earlier this year, Trump tweeted that he was finally going to do it.
00:13:05.120 --> 00:13:06.799
He was going to get rid of the penny.
00:13:07.039 --> 00:13:18.159
And so um once that tweet went out, um, it seems as though the Treasury took that as a directive and they stopped minting the penny in May.
00:13:18.399 --> 00:13:25.759
So that means they stopped shipping those out to the Federal Reserve where um banks pull from for their pennies.
00:13:25.919 --> 00:13:30.080
And so, really, what happened is they stopped as minting and didn't tell anyone.
00:13:30.240 --> 00:13:34.720
And so we were kind of all just surprised when the Federal Reserve started running out of pennies.
00:13:35.200 --> 00:13:40.879
And so this has led to a rapid decline in access to pennies for stores to make change.
00:13:41.039 --> 00:13:48.240
One of those issues that kind of really pops up out of nowhere where you like knew it was coming, but you didn't know it was an emergency until it is an emergency.
00:13:48.320 --> 00:13:50.399
And so that's kind of where we're at right now.
00:13:50.799 --> 00:13:52.879
Uh, you couldn't be more wrong with that statement.
00:13:53.039 --> 00:13:59.759
It was on my radar, you know, for us as a retailer, but uh not necessarily as quickly as it needed to be.
00:14:00.000 --> 00:14:00.240
Right.
00:14:00.399 --> 00:14:12.720
Um, and so you know, with no notice, not getting your coin deliveries, and you get notified that day that the penny is not being delivered, you definitely have to pivot and make some uh quick decisions on what you're gonna do.
00:14:13.039 --> 00:14:17.120
So what impacts have you seen at the NGA?
00:14:17.279 --> 00:14:19.039
You guys have the broader perspective.
00:14:19.279 --> 00:14:23.759
What what impacts have you seen on the shortage on retail?
00:14:24.960 --> 00:14:25.279
Sure.
00:14:25.440 --> 00:14:36.399
So because the government stopped minting the penny without telling anyone how they were gonna handle rounding, stores have kind of been
left to make those decisions on their own.
00:14:36.639 --> 00:14:45.679
And it's been hard for us to give rounding guidance because we don't want to tell folks one thing and they change their systems, and then we have to give them something different, right?
00:14:45.759 --> 00:14:47.440
Because there is no formal guidance on this.
00:14:47.519 --> 00:15:01.440
And so what we've seen stores doing is some stores are rounding down in favor of their customers, some stores are rounding up and giving the proceeds to charity, and then others are rounding similar to how we round, you know, learn to round in elementary schools.
00:15:01.519 --> 00:15:06.960
So your one, two, six, and seven are rounded down, and your three, four, eight, and nine are rounded up.
00:15:08.399 --> 00:15:11.679
And uh yeah, it is all over the board with no guidance.
00:15:11.759 --> 00:15:22.639
And there's also some bills that have been introduced, such as like the Common Sense Act, that could have a uh uh implication on how that is determined through retail as well, correct?
00:15:23.279 --> 00:15:23.679
Yes.
00:15:23.840 --> 00:15:29.120
So the Common Sense Act, we've been working with Congress kind of back and forth on what that's gonna look like.
00:15:29.519 --> 00:15:37.759
But I think we're in a really great place now where they are gonna handle rounding, they are gonna officially end the penny and different things like that.
00:15:37.919 --> 00:15:50.320
And they're gonna fix some of these legal pitfalls that we have been warning our members about, which happen around state and local taxes, paycheck check, paycheck caching, and SNAP.
00:15:50.559 --> 00:15:54.879
And so all of those transactions require exact change.
00:15:55.120 --> 00:16:05.440
And you know, we were worried about our members' liability when it came to um any issues that they might have by not being able to give exact change on those types of transactions.
00:16:05.600 --> 00:16:16.080
So we're really hoping the Common Sense Act is able to pass both the House and the Senate this year and provide national guidance so all retailers are able to follow the same rules.
00:16:17.279 --> 00:16:20.720
So, Stephanie, as we'd like to wrap up, I just have two more questions for you.
00:16:20.799 --> 00:16:24.240
What would you say have been NGA's biggest wins for this year?
00:16:25.279 --> 00:16:25.519
Sure.
00:16:25.679 --> 00:16:31.120
The biggest win we had this year was extending the tax cuts in the Big Beautiful bill.
00:16:31.279 --> 00:16:43.360
So even though the Big Beautiful bill made some changes to SNAP that we didn't love, it did extend all those tax cuts from 2017 that have been hugely important for our members.
00:16:43.519 --> 00:16:46.879
So we're really excited to see most of them made permanent.
00:16:47.039 --> 00:16:52.639
If that bill hadn't passed, most folks would have seen a dramatic increase in their tax bill come January.
00:16:52.799 --> 00:16:59.279
And so we are just so thrilled
to see those pieces included in the Big Beautiful bill.
00:16:59.440 --> 00:17:06.480
Additionally, while the snap cuts in the Big Beautiful bill are bigger than we would like, they were going to be even bigger.
00:17:06.559 --> 00:17:11.279
And so we were able to reduce the the impact to SNAP on the Big Beautiful bill.
00:17:11.359 --> 00:17:17.200
And so we're really excited to get those final changes in the final text.
00:17:17.599 --> 00:17:30.799
Well, and again, I know I mentioned at the beginning, but you and your team and uh everybody at the NGA does quite a bit of work and constantly in meetings, constantly trying to keep up on the changes and the moving parts and everything happening there in Washington.
00:17:30.880 --> 00:17:33.359
So truly appreciate the impact that you make.
00:17:33.519 --> 00:17:42.319
And then Stephanie, as we look to 2026, what what do you see things uh and how do you see them going next year in the upcoming calendar year?
00:17:42.880 --> 00:17:43.279
Sure.
00:17:43.359 --> 00:17:50.079
So the good thing is SNAP is funded through the end of September next year, and next year is an election year.
00:17:50.240 --> 00:17:54.240
I feel confident saying that they're not going to not fund SNAP again.
00:17:54.400 --> 00:17:57.680
I'm hopeful that we don't have to worry about those issues at the moment.
00:17:57.920 --> 00:18:06.160
I think what we'll see a lot more of is the Maha movement and folks looking at how make America healthy again.
00:18:06.559 --> 00:18:09.440
Policies can be integrated into the retail space.
00:18:09.519 --> 00:18:13.839
And so I think there's a lot of exciting ideas to look forward to there.
00:18:14.079 --> 00:18:27.680
We're also seeing some regulations on the food side about stocking standards and SNAP, and um, I think we're gonna get some sort of definition on ultra-processed foods, which also might impact SNAP.
00:18:27.839 --> 00:18:32.559
And there's definitely some opportunities and threats on the Maha side.
00:18:32.720 --> 00:18:43.599
I think we're also getting to strong support for our antitrust legislation in different states across the country, and so we're looking at pushing that out further.
00:18:43.759 --> 00:18:54.079
So I think there's a lot of opportunities there, and hopefully the penny issue will be solved by next year so we can spend that time working on other issues that are impacting members like energy costs and labor.
00:18:54.319 --> 00:19:00.880
2025 has been quite a surprising year, but we could see another big reconciliation bill in 2026.
00:19:01.039 --> 00:19:03.359
Um, we're just going to be prepared for whatever comes at us.
00:19:03.519 --> 00:19:07.920
But um hopeful that we'll have another um great year for NGA members.
00:19:08.319 --> 00:19:13.440
Well, and rest assured, it will be a lot of moving parts that we need to stay up on.
00:19:13.599 --> 00:19:16.240
So I will look definitely look forward to our next update.
00:19:16.480 --> 00:19:19.359
Stephanie, thank you so much for sharing your time with us today.
00:19:19.599 --> 00:19:28.400
I appreciate all the key points that you've uh brought us up to speed on that we need to be paying attention to and the impacts that they have and you know just what we need to be keeping our eye on.
00:19:28.480 --> 00:19:35.680
So I look forward to connecting on our next uh GR update and keep up the great work you guys are all doing over there in Washington.
00:19:36.160 --> 00:19:36.880
Thank you, Kristen.
00:19:37.119 --> 00:19:38.640
Thank you so much for having me.
00:19:38.880 --> 00:19:44.400
Thank you for tuning in to Check Out GR, a bonus podcast episode of Women Grocers of America.
00:19:44.559 --> 00:19:50.000
We hope today's conversation inspired you to be more engaged with the policy issues shaping our industry.
00:19:50.160 --> 00:19:55.920
Subscribe to Grocery from Her Seat for more insights and conversations with women leaders in the grocery world.
00:19:56.160 --> 00:20:02.240
Stay informed, stay engaged, and share Grocery from Her Seat on your favorite podcast listening platform.