Steps in the Right Direction: States Improve TANF Programs

Jul 17, 2013

By Elizabeth Lower-Basch and Lavanya Mohan

While TANF is an insufficient safety net, as we have discussed, a handful of states have recently done the right thing for low-income families by passing laws that improve their TANF programs. California, Minnesota, Illinois and Nebraska have all enacted laws that strengthen TANF programs to serve needy families.

Asset Limits: The Illinois state legislature passed a bill that removes the restrictive asset limit eligibility requirements for TANF applicants and recipients. Under the previous state rule, families could not have more than $3,000 in savings without losing TANF eligibility. This meant that low-income families could never move towards financial security by building their savings. By removing the asset limit altogether, Illinois will allow needy families to save for emergency needs, unexpected expenses or perhaps even a downpayment on a car.  Pending the Governor’s signature, Illinois joins Hawaii, which repealed its asset limit earlier this year, and six other states.

Family Caps: While typically TANF cash grants are based on family size, “family cap” laws prevent benefits from increasing to offset the added expenses when children are born into families already receiving TANF. These laws create hardships for needy families, especially affecting the most vulnerable poor infants. Moreover, studies have shown that family caps do not lower birth rates. As part of its budget, Minnesota repealed its family cap law. Similar legislation is still pending in California.

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