In Focus: Federal TANF Policy

Feb 10, 2016  |  PERMALINK »

Obama Budget Calls for Strengthening TANF

By Elizabeth Lower-Basch

In this week’s budget request, President Obama called for significant new funding to strengthen the effectiveness of Temporary Assistance for Needy Families (TANF) as a safety net for the lowest-income families with children.  These proposals are a strong complement to the legislative changes contemplated by the House Ways and Means committee last year, which would have made improvements to the TANF work participation requirements, but did not include any new funding.  

Specifically, the budget request calls for:

  • The first increase to the federal TANF block grant since it was created in 1996.  Since then, the value of the block grant has declined by a third due to inflation; moreover, the block grant has not been adjusted to account for population growth.  The budget calls for an increase of $750 million in FY 2017, rising to $2.25 billion by FY 2021, for a total increase of $8 billion over 5 years.   The budget suggests that these funds might be distributed based on the number of poor children in each state; this is important, because the current block grant formula, which is based on historical spending levels, gives states widely varying amounts per poor child.
  • A corresponding expectation that states will invest their own funds in programs for low-income people.  The budget calls for an increase in the amount that states must spend (known as “maintenance of effort” (MOE)), proportional to the increase in federal funds, and would prevent states from claiming third-party non-governmental expenditures towards that requirement.
  • Across both federal and state dollars, states would have to use at least 55 percent of the funds for core purposes and benefits – cash assistance, work-related activities, and child care.  (This share would rise to 60 percent by 2021.)  In addition, all TANF and MOE funds would have to be spent on low-income families, defined as those with incomes of 200 percent of the federal poverty level or less.  Currently, states may set their own definitions for what constitutes a “needy” family.
  • Setting aside a $2 billion pool for a new “TANF Economic Response Fund” modeled on the experience of the TANF Emergency Fund that states could access in times of high unemployment.    These funds could be used for basic assistance, non-recurrent short-term benefits, and subsidized employment programs; to qualify, states would have to increase their spending in these areas compared to a base period.
  • Repurposing the current TANF contingency funds (which can now be used for any TANF purpose)  to provide $473 million to support subsidized employment programs for low-income parents, guardians, and youth, and $100 million for two-generational demonstration projects that would focus on both parental employment and children’s needs.  Many states operated subsidized employment programs when the Emergency Fund was available, and found it an effective tool for connecting low-income people to work.  Two-generational programs are a promising approach that takes into account parents’ dual roles as workers and caregivers, and that recognizes how children’s well-being is inextricably tied to their parents.

The budget proposal does not make specific recommendations for changes to the TANF work requirements, but signals the Administration’s willingness to work with Congress to identify possible improvements.  It highlights the importance of making sure that states are held accountable for their performance in outcomes such as helping parents get jobs, sustain employment, and make progress in the workforce.  It also notes the importance of giving states the flexibility to coordinate with workforce efforts under the Workforce Innovation and Opportunity Act (WIOA), and to serve families with the most serious barriers to employment.  The budget would also make reducing child poverty an explicit goal of TANF and direct HHS to report an indicator of progress towards this goal annually.

Separate from TANF, the budget proposes $2 billion over 5 years for a new initiative to test efforts to provide emergency assistance to the growing number of very low-income families facing significant economic hardship and distress.    This would support competitive grants to states and counties that would be encouraged to partner with community-based organizations and allow for rigorous evaluation of the effectiveness of these supports, without undermining key existing safety net programs.

Oct 6, 2015  |  PERMALINK »

Making a Difference for Poor Babies Using TANF: A Framework for States

By Elizabeth Lower-Basch and Stephanie Schmit

Americans overwhelmingly agree that children’s fate in life should not be determined by the circumstances in which they are bornBut children born into poor families are at great risk of persistent poverty during their childhood. A growing body of evidence shows that poverty in early childhood is a grave threat to children’s long-term health, well-being, and educational success, with persistent and deep poverty causing the most damage. A new CLASP report, TANF and the First Year of Life: Making a Difference at a Pivotal Moment, suggests an innovative framework for thinking about Temporary Assistance for Needy Families (TANF) in the context of the first year of life, a vision for what a reformed TANF might look like, and concrete steps that states can begin taking right now to move their programs in this direction.

TANF offers an important, large-scale, high-impact opportunity to achieve two-generational goals for poor families with infants because:

  • TANF already reaches about a quarter million of the poorest families with babies or pregnant women, which is about half of deeply poor families with infants.
  • By its design, TANF is inherently a two-generational program, in that it is explicitly aimed at serving low-income families with children.
  • TANF is a block grant that gives states a great deal of flexibility in deciding which needy families to serve, what services to provide, and what to expect of recipients.

Today’s state TANF programs too often fall far short of their potential. Barriers to access, underfunded services, and work requirements that do not take the needs of infants into account hold parents back and make it harder for them to lift themselves and their babies out of poverty. For example, in 11 states, parents of infants under the age of one are subject to work requirements and could lose their entire family’s cash assistance benefit the first time they fail to meet work requirements.

But the growing evidence about the importance of the first year of life for children’s long-term success offers the opportunity to build a much stronger case than even just a few years ago for redesigning TANF programs to meet the developmental needs of infants in TANF families.

For the first time, the paper provides a framework grounded in the research about infant development and detailed data about TANF families and state policy options, to provide a wealth of practical ideas for state leaders. These ideas, organized into a package of foundational options for all states to consider, along with a set of more innovative options for states that have made strong progress on the foundations, include:

  • removing barriers that prevent pregnant women and parents of babies from accessing cash assistance;
  • redesigning work requirements to reflect the needs of infants and the realities of today’s low-wage labor market;
  • ensuring access to quality child care; and
  • building linkages to other programs and services, such as early childhood home visiting, health care, and nutritional supports.

Some states have already started to adopt more evidence-based and positive policies for TANF families. Minnesota repealed its family cap in 2013. Last year, Washington state set aside nearly $1 million from the TANF block grant to fund a pilot home visiting project targeting TANF recipients using evidence-based models already used in the state. The recent reauthorizations of the Child Care Development Block Grant (CCDBG) and the Workforce Innovation and Opportunity Act (WIOA) require states to make a number of changes to how they deliver the services funded by these programs, and how they relate to TANF. This makes it an opportune time for states to think holistically about how these multiple programs serve the same families, and to re-envision TANF as a true two-generational anti-poverty program. 

Jul 14, 2015  |  PERMALINK »

CLASP Reacts to Release of 2015 TANF Reauthorization Bill

By Nune Phillips

The U.S. House of Representatives Ways and Means Committee has released a bill to reauthorize the Temporary Assistance for Needy Families (TANF) program. Since its previous reauthorization in 2005, TANF has been continued under short-term extensions. CLASP strongly recommends that TANF reauthorization focus on alleviating poverty and creating effective pathways to economic opportunity.

TANF is a safety net and employment program meant to provide low-income parents the support necessary to become economically stable and provide a better future for their children. However, research shows that TANF has not accomplished either goal. Low caseloads indicate that families are not utilizing the program due to a variety of factors.

Reauthorization gives Congress the opportunity to transform TANF into a program that truly helps low-income families meet immediate needs while advancing toward economic stability. CLASP is strongly committed to making this program work; we will be reviewing the reauthorization bill and will continue to engage Congress to ensure TANF provides an adequate safety net and necessary employment support.

For background information on TANF, see our TANF 101 series of briefs.

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