Welfare Policies

Temporary Assistance for Needy Families (TANF)

In 1996, after pledging to “end welfare as we know it,” then-President Clinton and Congress passed the Personal Responsibility and Work Opportunity Reconciliation Act, known as the welfare reform law. The law replaced the entitlement to cash assistance, known as Aid to Families with Dependent Children (AFDC), with the Temporary Assistance for Needy Families (TANF) block grant program.

TANF was created to reduce welfare dependency in two ways. First, by requiring recipients to work in order to receive cash assistance, and second, by limiting how long a family can receive welfare. Families with dependent children or pregnant women with an income below a percent of the federal poverty line (states choose the eligibility level) receive monthly cash assistance. Other changes to the program made in 1996 included:

• Entitlements: Under AFDC, states received federal funds as an entitlement, which meant that every family who was eligible for assistance received assistance. When the program was changed to a block grant program, families in need were no longer guaranteed assistance. Now, since TANF money is “block granted” to the states, each state is allowed to design and implement its own TANF program and to set benefit levels to determine who receives assistance.
• Funding amounts: The federal government provides states with a total of $16.5 billion annually (not adjusted for inflation) to administer their TANF programs. The amount of money each state receives is based on how much federal welfare spending per state in the mid-1990s under AFDC. Each state is also required to spend at least 75 percent of the amount it spent on welfare programs in fiscal year 1994. This state contribution is called Maintenance of Effort (MOE).
• Time limits: Congress set a 60-month (5-year) time limit on TANF benefits, although some states have taken advantage of the flexibility to shorten or extend this period.
• Work Requirements: TANF includes work requirements of 30 hours for individuals with children over 6 and a 20-hour requirement for those with children under 6. TANF recipients may enroll in job training and educational programs for up to a year in some states if they continue to meet full work requirements.
• Sanctions: Additionally, federal law allows TANF recipients to be sanctioned, meaning that part or all of their TANF benefits can be cut if they are considered to be in violation with program requirements. Sanctions can result in losing TANF eligibility permanently. Child Care: The Child Care and Development Block Grant (CCDBG) provides funds for states to assist low-income families with child care needs. Congress decides on mandatory funding levels for CCDBG in TANF legislation.

President's Fiscal Year 2011 Budget Funds TANF but Enrollment Lags Increase in Poverty

The Obama Administration’s budget proposals for fiscal year 2011 would extend TANF as is for one more year but with new funding.  The proposed new funding includes a $2.5 billion “emergency fund” and a  $500 million “Fatherhood, Marriage and Families Innovation Fund.”  The $3 billion proposed for these two funds represents about a one sixth increase in federal TANF spending, a significant anti-poverty investment.  However, a larger anti-poverty investment is urgently needed as family poverty is now so common. The child poverty rate reached 19 percent in 2008 and certainly climbed higher in 2009. Legal Momentum says they applaud the emergency TANF funding as it incentivizes states to aid more poor families.  But TANF still has structural flaws that have led to a sharp decline in the percentage of poor families aided and in the amount of aid a poor family receives.

 

According to the Brookings Institution, the number of people receiving welfare has declined more than 50 percent since the enactment of TANF in 1996. This, however, is not because people are no longer living in poverty. A study by the Urban Institute illustrates that more than 50 percent of those who have left welfare and are working earn wages below the federal poverty line. Although many welfare recipients have found work, often, they are low-wage jobs that provide no benefits. With the economic recession and rise in unemployment, many parents who moved from welfare to work have found themselves laid off, ineligible for unemployment compensation, and are facing the five-year lifetime limit on welfare benefits.

RESULTS believes that to “make work pay,” families need:

• Child care
• Opportunities for education and job training to allow them to find jobs that pay enough to support their families
• Access to substance abuse treatment and rehabilitation services
• Access to health coverage

These supports, rather than threats and penalties, will enable families to become self-sufficient.

RESULTS’ Recommendations during the Last TANF Reauthorization

RESULTS supported a full reauthorization of the program that does “no harm” to families or, if that is unlikely, a clean long-term extension of existing law. Our core message is that TANF should support low-income families by providing the tools they need to lift themselves out of poverty, rather than just off welfare, and provide a significant increase in funding for child care. Recipients of welfare need to be able to access services that enable them to find jobs that support their families. Our specific recommendations for changes to TANF in 2005 included:

• Maintaining current work requirements, which are 30 hours for individuals with children over 6 and 20 hours for those with children under 6.
• Rejecting an expansion of the “superwaiver” provision and other waivers that would let states receive exceptions to crucial provisions of Food Stamp and otherprograms that support low-income families.
• Supporting provisions that allow flexibility in work requirements by counting at least 24 months of education and job training, rehabilitation services, and other activities that certain welfare recipients need as work.
• Supporting significant increases to childcare funding similar to the Snowe-Dodd amendment passed by the Senate in March 2004.
• Providing health coverage for lawfully present immigrant pregnant women and children and to give states the flexibility to use federal dollars to pay for benefits for lawfully present immigrants.

For more information on TANF and child care, please visit:

• RESULTS PowerPoint presentation Pathways out of Poverty: TANF and Child Care
• RESULTS background on child care