A Look at TANF Funds Used for Child Care in 2010

Jan 11, 2012

By Stephanie Schmit

Updated May 29, 2012

After three years of increases, federal Temporary Assistance for Needy Families (TANF) funds used for child care assistance fell sharply in 2010. TANF funds used for child care decreased from $3.5 billion to $2.8 billion in 2010, a 20 percent drop, according to data released by the Administration for Children and Families.

States choose to use TANF funds to provide child care assistance to families. One way is to spend TANF funds directly on child care, usually in the form of vouchers given to parents. Between 2009 and 2010, funds spent directly on child care through the TANF program decreased from $1.8 billion to $1.4 billion.  States may also choose to transfer up to 30 percent of their annual TANF block grant to the Child Care and Development Block Grant (CCDBG) or to a combination of CCDBG and the Social Services Block Grant (SSBG). TANF transfers to CCDBG decreased from $1.7 billion in 2009 to $1.4 billion in 2010. Nine states transferred the maximum amount of funds: Alaska, Florida, Massachusetts, Mississippi, North Carolina, Oklahoma, South Dakota, Tennessee, and Washington. Seven states transferred between 25 and 30 percent of their TANF funds to a combination of CCDBG and SSBG: Hawaii, Iowa, Kentucky, Montana, Nebraska, New Mexico, and Pennsylvania. 

States are required to spend state dollars through a TANF maintenance-of-effort (MOE) requirement. State MOE spending on child care increased from $2.3 billion in 2009 to $2.6 billion in 2010. A portion of TANF MOE funds spent on child care may also be directed toward states' CCDBG MOE requirement. 

The Administration for Children and Families has not yet released FY 2010 expenditure data for CCDBG, so it is not possible to determine total child care spending (CCDBG and TANF combined) for 2010. When that data becomes available, CLASP will produce additional analysis on national child care spending trends as in prior years, as well as update state-by-state child care spending information. For the first year, State-by-state tables analyzing TANF and MOE spending are available from ACF.

 

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