AUGUSTA, Maine — On mostly party-line votes, a package of bills offered by Republican Gov. Paul LePage meant to reel in misuse and abuse of state-issued Electronic Benefit Transfer cards and the cash welfare funds loaded on them were rejected by the Legislature’s Health and Human Services Committee on Wednesday.

The committee Wednesday watered down two of the proposals, changing them to legislative resolves directing the Department of Health and Human Services to study and report back with additional information.

Democrats on the committee said they opposed the measures largely because parts of them were already being implemented while other components either conflicted with federal law or would be nearly unenforceable.

Democrats on the committee said DHHS could do more to enforce existing laws and prosecute fraud when it’s discovered.

“I would be in favor of this committee sending a message to the department and the attorney general that we expect the rules as they currently exist to be followed and for these things to be investigated properly,” Rep. Drew Gattine, D-Westbrook, said.

LePage and DHHS officials have pointed to EBT card data that shows Maine benefit cards have been used to withdraw cash from ATMs in strip clubs, casinos, liquor stores and out of state.

LePage issued a sharp rebuke to Democrats on the committee.

“They prefer to automatically hand out welfare benefits to anyone who applies, instead of simply asking them to look for work first,” LePage said in a prepared statement. “This is outrageous. Mainers don’t mind providing a hand up, but they expect applicants to try to get a job before asking the taxpayers for welfare.”

One of the bills would have required those applying for benefits under the Temporary Assistance to Needy Families program to show they had applied for at least three jobs. The other would have prohibited the use of TANF benefits outside Maine while the third made illegal the use of cash benefits on EBT cards for the purchase of alcohol, tobacco, gambling or bail.

Republicans on the committee said the measures were ultimately aimed at protecting the state’s limited resources and ensuring that the truly needed receive the help they deserved.

“If we don’t have the resources to go around to those individuals, what does it say when someone is taking a $1,000 withdrawal on the Las Vegas strip?” asked Rep. Deborah Sanderson, R-Chelsea. “Do they need that $1,000 or would that be better spent?”

Beth Ham, the director of DHHS’ Office of Family Independence, said the state’s welfare fraud and abuse investigative task force had begun to drill deeper into EBT card data in an attempt root out misuse and abuse.

She said the department’s new analytical tools would allow for a better enforcement but, unlike some other states, Maine doesn’t limit EBT transactions out of state or at so-called point-of-sale terminals. She said the department had begun to restrict the ability of recipients to withdraw cash from ATMs in prohibited locations such as liquor stores and strip clubs.

Democratic lawmakers on the committee pointed out that much of the EBT data the administration was highlighting came from transactions that occurred before a 2012 law change that aligned state law with federal law prohibiting the use of the cards at such locations.

Ham also said the department has taken steps to better educate card recipients about where they can use their benefits and what they can buy with them.

Individuals caught misusing the cards could be sanctioned and removed from the state’s TANF program under the current rules.

She said the state was working with Xerox, the company that services Maine EBT cards, to block specific ATM machines based on a terminal identification.

Investigating and prosecuting abusers may cost more money than the state would recover, Gattine said, noting while all fraud should be prosecuted, the state must consider a “cost-benefit” approach and put its money toward the largest offenders, namely care providers and drug-makers in the state’s Medicaid system.

Holly Lusk, senior policy adviser on health care for LePage’s administration, told the committee that about 71 percent of the tips on welfare fraud came from the state’s welfare fraud hotline.

Another proposal that LePage has offered would require photo identification on EBT cards to help prevent misuse by unauthorized people. But the LePage administration has determined it doesn’t need a new law to make that change and is moving forward with the proposal.

The committee also rejected a bill that would have eliminated the state’s Parents as Scholars program, which allows some TANF recipients to receive benefits for up to two years while they are full-time students pursuing a two- or four-year college degree.

Also on a party-line vote, the committee approved a bill, sponsored by Gattine, directing DHHS to annually report to the Legislature on its efforts to investigate and prosecute fraud, waste and abuse within the state’s welfare programs.

Republicans expressed disappointment that Democrats seemed unwilling to approve what they saw as “common sense” restrictions on taxpayer-funded programs for the needy.

They noted that at least 19 other states, including Vermont and New York, have work-search requirements as part of their TANF programs.

“Everyone I speak with — Democrat, Republican, or independent — thinks this bill is a great idea,” House Minority Leader Ken Fredette, R-Newport said. “It’s just the Democratic politicians who are out of touch and think that the welfare status quo is working out just fine. As someone who grew up in poverty, I can tell you that it’s not. We must act to ensure that our scarce resources are going to those who truly need them and we must break the cycle of intergenerational dependency.”

Democrats said they weren’t turning a blind eye to fraud in the welfare system but much of the controversy prompting the LePage bills was stirred by anecdotes and not hard facts.

“If there is fraud, no matter how small, it should be investigated and prosecuted, not politicized,” said Rep. Dick Farnsworth of Portland, the House chairman of the committee. “We are directing the governor to investigate that fraud and prosecute it, if it is real. He should stop using it to pull the rug out from struggling families, especially at a time when Maine has one of the worst job growth records in the nation.”

Scott Thistle

Scott Thistle is the State Politics Editor for the Lewiston Sun Journal. He has covered federal, state and local politics in Maine for nearly two decades.