Congressional Deadlock Leaves TANF Funding in Limbo; January Benefits Should Not be Affected

Dec 22, 2011

By Elizabeth Lower-Basch

Update: On December 22, the Speaker of the House announced that they had agreed to pass a two-month extension bill, including the TANF block grant.  This bill was passed by the House and Senate on December 23 and will soon be signed by the President.  Therefore, there is currently no risk of a lapse in TANF funding.

A needed extension of Temporary Assistance for Needy Families (TANF) block grant funds into the new year has been caught in the Congressional stalemate over the payroll tax cut and unemployment insurance benefits.   Unless Congress takes action, states will not receive additional TANF funding after December 31, 2011, when the three month extension provided in Public Law 112-35 (H.R. 2943) expires.

However, the Administration for Children and Families has clarified that, if there is a lapse in funding, states may still use any funds they have available from the first three months of FY 2012, or from any previous fiscal years, for allowable TANF purposes.   States may also use their own funds, which they will be able to either claim toward the maintenance of effort (MOE) requirement, or have reimbursed from federal TANF funds when Congress authorizes them.  Therefore, there is no reason that any recipient should see an interruption in their benefits as a result of this technical interruption in the program.  States should do whatever is necessary to ensure that poor families are not affected.

It is important to note that this is not the result of any deliberate attempts to remove funding from the TANF program.  In fact, the House of Representatives has passed extensions of the TANF block grant through the end of FY 2012, both as part of the larger payroll tax/unemployment bill and as a freestanding bill.  The Senate included TANF in the shorter extension bill that it passed as well. 

Statements made today by Republican leaders in Congress indicate a growing chance that the Congress will pass a short-term extension of these programs before December 31.  We hope that Congress will act swiftly to remove this uncertainty and extend TANF funding, as well as the other critical programs that have been left hanging.   

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