RETAILERS DECRY FLORIDA'S SAS PULLOUT

TALLAHASSEE, Fla. -- Florida retailers are pushing the state to reverse its decision to pull out of a multistate electronic benefits transfer alliance.In what was described as a "sudden" move, Florida withdrew late last month from the Southern Alliance of States, whose developing EBT pilot is to serve as a model for a national system. Florida has initiated plans to develop its own EBT program and

TALLAHASSEE, Fla. -- Florida retailers are pushing the state to reverse its decision to pull out of a multistate electronic benefits transfer alliance.

In what was described as a "sudden" move, Florida withdrew late last month from the Southern Alliance of States, whose developing EBT pilot is to serve as a model for a national system. Florida has initiated plans to develop its own EBT program and a legislative bill recently introduced calls for a July 1997 launch.

Distributors and industry officials said the move could create additional costs, delays and systems compatibility problems across state lines for both Florida and the SAS projects.

The state's departure may have further reaching implications for SAS, since Florida's 1.4 million benefits recipients represent about 32% of the alliance's transaction volume, according to the Federal EBT Task Force, Washington.

Retailers told SN that Florida's decision came as a surprise and has left confusion on how to proceed in its wake. Many retailers have invested in front-end technology based on plans for the SAS project.

"It's a muddy field right now," said one large wholesaler that supplies stores in Florida. "We're back to Square One, but we're going to mount some kind of offense."

"We thought we were on course with the SAS, and now all of a sudden we find the rug's been pulled out from under us," said Bruce Congleton, president

of the Florida Food Industries Association here.

"We have told the [state Department of Health and Rehabilitative Services] secretary and the governor's office that as retailers we are opposed to this," Congleton added.

Retailers including Winn-Dixie Stores, Jacksonville, and Publix Super Markets, Lakeland, were among those set to meet with state HRS officials last Friday to argue against the decision.

"We've let it be known that we would like to have a uniform EBT program" that is compatible with other states, said Mickey Clerc, vice president of public relations at Winn-Dixie. "A uniform program would be the most efficient for us to operate and the most cost-effective for the beneficiaries."

Florida's decision to pursue its own program "further delays EBT. This new [negotiation] process could take as long as two years," Congleton added. "We don't think it will connect with the SAS because it's a different process of procurement."

A spokeswoman for Florida's HRS Department said the decision was prompted in part by concerns that the SAS program was progressing too rapidly.

"The secretary decided the best course of action would be to withdraw from the Southern Alliance, go out on a state [request for proposals] process and see what we come up with," said Michelle Lagos, communications director.

Florida officials also reportedly feared they didn't have legal grounds to contract with the designated SAS financial services agent, Citibank, New York, because of state laws related to bidding procedures.

Retailers and industry officials in neighboring SAS states also decried Florida's decision, fearing that having an incompatible border state will diminish the SAS goal of an open EBT network.

"Florida is a boundary state and we truly wanted all of our borders to be surrounded by SAS states," said one industry official in Georgia. With Florida's pullout, two of Georgia's five border states do not belong to the SAS.

The move will also affect the costs of other SAS members. While each state negotiates its contract, price rates are determined by the total number of benefit recipients. Florida has more than 1.4 million food-stamp recipients and about 648,000 Aid to Families With Dependent Children recipients.

Pilots in other SAS states, slated to begin later this year, will continue as planned, industry officials said. The remaining SAS members are Alabama, Georgia, Arkansas, Kentucky, Missouri, North Carolina and Tennessee.