In Focus

Aug 22, 2016  |  PERMALINK »

20 Years After Welfare Reform: College Students and Benefits

By Amy Ellen Duke-Benfield

On TANF's 20th anniversary, I was interviewed by the Chronicle of Higher Education on how benefits can support students attending college as well as the policies that restrict their access.

The number of college students receiving TANF cash assistance dropped dramatically after welfare reform because of new time limits on education and training that sharply limited access, and because the total number of people receiving cash assistance dropped so much. However, students may receive other benefits, such as food assistance under SNAP or help paying for child care. A 2013 study found that 18.6 percent of students reported receiving a public benefit, including TANF, SNAP and free school meals, but not Medicaid. We know that benefit receipt is often underreported, so that may be a low estimate.

Today’s economy increasing requires post-secondary credentials for good jobs.  President Obama has said every American should have at least one year of postsecondary education and training, leading to a credential. Yet our anti-poverty programs have rules that directly contradict those goals by requiring too many work hours in combination with education, or time limiting education and training to such a degree that it hampers the ability of low-income students to attain credentials that allow them to get a family-supporting job.

Because of space limitations, the Chronicle didn’t run my answer to the question of what policy changes would make the most difference to students. Here’s the answer I gave:

First, it's important to recognize that this isn't simply about making the programs more user-friendly to low-income students, but also ensuring these program goals are aligned with our economic development and global competitiveness goals.  Even an  associate's degree or one-year certificate offers much better chances of placement in a job that offers family-supporting wages, instead of immediate placement in a minimum-wage job, or very short-term training programs with less economic payoff.  Society is far better off if people receive benefits for a little bit longer while they're in school, but are able to complete a degree or certificate that is valued in the labor market and gets them into a better job for the long run.

The answer to what could be done varies quite a bit by program.  For SNAP, the biggest change would be to remove the restrictions on student eligibility. That's the single biggest barrier to more low-income students receiving SNAP.  That would require federal legislation; however, even under the current rules, states could do much more to make sure that students who qualify for exemptions know about SNAP, and to make sure that students in employment-focused education and training qualify.

For TANF, even though the federal rules restrict how much education and training can count toward the work participation rate, states still have the flexibility to make different choices, such as not requiring 20 hours of work in conjunction with full-time college attendance.   Some states, such as Kentucky, Minnesota, and Pennsylvania have done so, recognizing that education and training supports the long-term goal of helping people get better jobs so that they don't need assistance in the future. 

The Child Care and Development Block Grant (CCDBG), which was reauthorized in 2014, significantly improved the health and safety standards and provided for more stable care for families by requiring 12-month eligibility. However, the reauthorization came with very little additional money causing states to have to make difficult decisions about how to spend money and where to invest. The most important improvement that could be made for this program is a significant investment to ensure that more children can access high-quality care. Currently, about 1 in 7 eligible families receive child care subsidies, whether the parents are working or going to school or both.  As a result, even in a state where students are eligible to receive child care for their children, it’s certainly not a guarantee that they will.

The rules related to student eligibility for subsidized housing assistance for low-income individuals are complex. A student may receive Section 8 housing assistance while living separately from his or her parents only if both the student and the student’s parents are income eligible. The restriction does not apply to students who are veterans, married, have a dependent child, or are 24 years are older. Most independent students are eligible if they meet the income requirements, but definitions of eligible “families” sometimes exclude or deprioritize full-time students.  The Department of Housing and Urban Development should encourage local PHAs to treat full-time students similarly to working families, encouraging greater eligibility for public housing. In addition, financial aid for education-related expenses, such as fees, books, supplies, and transportation to school, should not be considered “income” for the purposes of determining Section 8 eligibility. 

And finally, for health insurance, the 19 states that haven't expanded Medicaid for all poor adults should do so. In these states, people with incomes under 100% of poverty who are not eligible for Medicaid under their state’s existing income eligibility limits and who don’t make enough to receive subsidies to purchase health insurance through the ACA marketplace fall into a coverage gap. In many states, adults without dependent children are not eligible at all for Medicaid, no matter how poor they are, and parents are only eligible at very low income levels.

Aug 17, 2016  |  PERMALINK »

New TANF Spending Categories Shine Light On State Spending

By Jessica Gehr

As we approach the 20th anniversary of the creation of the Temporary Assistance for Needy Families (TANF) block grant, new spending data for fiscal year (FY) 2015 shows that states continued to spend less than half of their block grants and related state funds on core activities, including cash assistance, work and training activities, and child care.

Under the TANF block grant, states have great flexibility to use funds to support a broad range of activities that benefit low-income families with children. Many states have used that flexibility to support services such as child welfare, pre-kindergarten programs, and after-school care. New reporting requirements for FY 2015 broke down expenditures into more specific categories, providing a clearer path to understanding the ways in which TANF supports such activities.

In FY 2015, 25 states spent less than half of their TANF and state maintenance of effort (MOE) funds on core activities. Additionally, basic assistance, as a share of federal and state TANF funds, decreased by nearly two percent. Seven states spent less than 10 percent of their TANF and MOE funds on basic assistance, and only three states spent more than 75 percent of TANF and MOE funds on core activities. TANF is intended to promote job preparation and work, yet less than 7 percent of all funds were spent on work, education, and training activities. Moreover, that modest expenditure may not have been used for families receiving assistance. States should focus their spending on core activities that help the families who are struggling most to make ends meet and progress toward long-term economic stability.

The new, more detailed reporting for expenditures shows that states spent 8 percent of TANF and related funds on child welfare services (including foster care) and 6 percent on Pre-Kindergarten/Head Start programs. However, spending varied significantly by state. For example, Georgia and Texas spent roughly 50 percent and 36 percent, respectively, of TANF and MOE funds on child welfare services. Louisiana and Texas spent roughly 30 percent and 38 percent, respectively, on pre-k and Head Start programs. While these are important services, this is not what TANF was originally intended to do. States are leveraging TANF flexibility to fund other services, rather than spending on TANF’s core purposes. 

The real value of the TANF block grant has declined by 33 percent due to inflation since TANF was created, and the use of TANF funds to support a wide range of services has further reduced the funding that is available for core activities. The result is a weak, and deeply uneven, safety net for the poorest families with children. Congress should set standards and hold states accountable for using TANF funds to serve these families.

Jul 28, 2016  |  PERMALINK »

In TANF’s Twentieth Year, Prioritizing Education and Training is Needed

By Randi Hall

New work participation data released this week from the Office of Family Assistance shows that recipients of cash assistance under the Temporary Assistance for Needy Families (TANF) block grant have little access to education and training activities, even though today’s labor market increasingly requires workers to have postsecondary credentials in order to access steady well-paying jobs.  Specifically, the recent share of work-eligible TANF recipients who participated in relevant activities—including education related to employment, vocational education, job skills training and satisfactory school attendance—was only 15 percent, down from 18.3 percent in 2013.

In a new policy brief, CLASP reviews the evidence for the need for postsecondary credentials for labor market success and the effects of obtaining such credentials for TANF recipients.   The brief reiterates the importance of emphasizing educational and job training pathways for TANF recipients, and highlights recent state policy changes that reflect the realities of today’s economy and the opportunity to make further changes by aligning employment programs for TANF recipients with the new Workforce Innovation and Opportunity Act (WIOA).

The brief also identifies federal policy changes that would support states by giving them credit toward the federal work participation rate for engaging TANF recipients in education and training, such as those included in last year’s discussion draft bill for TANF reauthorization put forth by the U.S. House Ways and Means Subcommittee on Human Resources. While we largely supported the initiatives outlined in the draft bill to strengthen TANF’s core purposes and improve the measure of its work participation rate, we raised concerns over the lack of additional flexibility and funding to address and support recipient families' needs and barriers to employment.  Senator Angus King’s (I-ME) recently introduced Enhancing and Modernizing Pathways to Opportunity through Work, Education, and Responsibility (EMPOWER) Act,  would go further toward support education and training for TANF recipients.  The summary of the bill highlights how the EMPOWER Act would  allow states to incorporate education and training opportunities as a pathway to move TANF recipients into stable jobs that pay adequate wages.

While the EMPOWER Act received bi-partisan co-sponsorship from Sens. Kelly Ayotte (R-NH), Sherrod Brown (D-OH) and Shelly Moore Capito (R-WV),  Congress has now adjourned for the Presidential conventions and the August recess.  Given the limited time in which Congress will be in session during this election year, it is unlikely that either the House or the Senate will take up TANF reauthorization this year.  However, these bills provide good starting points for a discussion next year.

The U.S. economy has vastly transformed since TANF was created, but TANF has not.  TANF should be redesigned to improve its effectiveness as both a safety net and an employment program, so that it can truly reduce poverty.

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