Hunger Relief Tax Incentive Act Would Increase Food for Hungry People

Washington, DC -- March 14, 2000 -- Feeding 26 million hungry Americans is always a challenge, but with the help of the Good Samaritan Hunger Relief Tax Incentive Act, S. 37, getting more food donations would be easier, according to testimony offered today before the Senate Finance Committee by Doug O'Brien, Director of Public Policy and Research at America's Second Harvest. The nation's largest private charitable hunger-relief network, America's Second Harvest, reaches nearly every community to meet the basic food needs of the most vulnerable and needy Americans.

The Good Samaritan Hunger Relief Tax Incentive Act would provide a new tax incentive to family farmers, small businesses and independent restaurant owners that would make in-kind food donations financially viable. It would allow all food donors, regardless of the types of business they operate, to take a charitable tax deduction for that donation.

"This is one tax change that is a win-win for all parties - farmers, small businesses, charities, and most importantly, hungry Americans," O'Brien testified today.

"Nearly all of our food banks have experienced a startling paradox of increased need for hunger relief services at a time of unprecedented American prosperity. Despite the generally strong economy, low-unemployment, and falling welfare and food stamp caseloads, demand for emergency food assistance has been consistently rising in most communities, " O'Brien stated.

The growing demand for emergency food assistance has in too many instances outstripped the food resources of local charities. A 1998 study of America's Second Harvest food banks indicated that between 115,000 and 800,000 low-income people -- representing roughly 6.5 percent of all requests -- were denied emergency food assistance at local charities because the charity they turned to for help lacked adequate food. Similarly, the U.S. Conference of Mayors reported in December that requests for food assistance went unmet in 13 percent of cases. According to agency surveys, the America's Second Harvest network alone experiences an annual shortfall of in-kind food donations of nearly one billion pounds.

The Good Samaritan Hunger Relief Tax Incentive Act would also simplify and enhance the value of the tax deduction, allowing donors to use the "fair market value" to determine their charitable contribution. For farmers and other businesses using the "cash method" of accounting, the deduction would be expanded to the basis of any qualified contribution at 50 percent of the fair market value. Finally, the Act would codify the notion that the taxpayer, not the Internal Revenue Service, should - with substantiation of fair market value - make the determination of the value of the donated food.

America's Second Harvest feeds hungry Americans through 50,000 community-based agencies served by more than 200 affiliated food banks and food rescue operations in all 50 states, the District of Columbia and Puerto Rico.

The United States Department of Agriculture estimates that 96 billion pounds of edible food are wasted and dumped in landfills each year. Through enactment of the Good Samaritan Hunger Relief Tax Incentive Act, if even one percent of that food was re-directed from landfills to local charities instead, it would nearly double the entire food distribution throughout the America's Second Harvest network to people in need.