In Focus: State TANF Policies and Data

Mar 4, 2016  |  PERMALINK »

It’s Not 1996 Anymore; TANF Cash Assistance Doesn’t Go Far Enough

By Randi Hall

Since 1996, inflation has eroded the value of a dollar by more than 30 percent. Some key costs have gone up much more—the average fair market rent for a two-bedroom apartment in the United States has increased by 71 percent and average transit fares have increased by 50 percent. But in many states, families with children receiving cash assistance under the Temporary Assistance for Needy Families (TANF) block grant are struggling to make ends meet with benefits that have remained stuck at 1996 levels.

In 23 states, TANF benefit levels have either decreased or remain unchanged since welfare reform was enacted in 1996. In some states, it has been even longer since families received an increase. The Mid-Minnesota Legal Aid recently released a report highlighting the erosion in value of basic cash assistance under the state’s Minnesota Family Investment Program (MFIP). A family of three can receive a maximum monthly grant of $532 under MFIP, an amount determined in 1986 that has not increased since. Similarly, New Jersey Policy Perspective reports that the maximum amount of assistance for a family of three has been set at $424 per month since 1987. Basic cash assistance under TANF leaves low-income families with significant gaps to meet their basic needs.

Cash assistance has failed to serve those who need it most, both in its nominally small grant amounts and in the restrictive income limits that disqualify working poor families. In 26 states and the District of Columbia, a family of three reporting annual earnings at 50 percent of the federal poverty level, or $19,790 in 2014, made too much to qualify for cash assistance under TANF. Annually adjusting the cash assistance amounts would immediately benefit working poor families facing material hardship. For example, if Minnesota’s monthly cash grant had been adjusted annually for inflation, a family of three would afford to purchase $1,148 in goods and services (more than double the purchasing power of the $532 amount that’s been frozen in time since 1986.)

A few states are trying to address this issue. This year, New Jersey lawmakers have stated their intent to raise the state’s monthly benefit grant over three years while calling for an annual cost of living increase. State representatives in Virginia have offered two separate bills that would increase the monthly benefit amount for TANF recipients.

One reason benefit levels have remained stagnant in so many states is that the TANF block grant itself has not been adjusted for inflation since the program was created. Another reason is that many states use a large share of their grants for purposes other than cash assistance. President Obama’s proposed FY 2017 budget addresses both these issues. It would increase the block grant by $8 billion over 5 years—requiring a corresponding increase in state spending—and would also require states to spend at least 55 percent (rising to 60 percent over time) of the funds for core purposes and benefits: cash assistance, work-related activities, and child care. While these improvements are vital to expand economic opportunity and stability for poor families with children, states should not wait for federal action to adjust monthly benefit amounts to meet the cost of living in the 21st century. After all, it’s not 1996 anymore.

Dec 16, 2015  |  PERMALINK »

California Should Eliminate the Maximum Family Grant; Evidence Shows Outdated Policy Causes Lasting Harm

By Olivia Golden

In 1994, before federal welfare reform imposed lifetime limits and stronger work requirements, California adopted its Maximum Family Grant (MFG) policy, also known as a “family cap,” which denies benefits to babies conceived and born while their families are receiving cash assistance. The policy was never implemented under the pre-reform Aid to Families with Dependent Children (AFDC) Program because the state was not approved for a federal waiver. However, welfare reform made the decision a state rather than federal one, paving the way for the policy to be implemented. So in 1997, when I was Acting Assistant Secretary for Children and Families at the federal Department of Health and Human Services, I was informed by Eloise Anderson, Director of the California Department of Social Services, that the state was withdrawing its waiver request and would implement the policy under the new Temporary Assistance for Needy Families (TANF) block grant.

But after 20 years, the evidence is in: these family cap policies don’t work. Worse, they can cause lifelong damage to children’s learning and development. A growing body of research shows that infancy is a critical period for children’s development, with implications for lifelong physical and emotional well-being. Experiences during the infant and toddler years shape the architecture of the brain—including cognitive, linguistic, social, and emotional capacities—at a phenomenal rate and lay the foundation for future growth and learning. Today, we now know far more than before about the importance of the first years of life—and the cumulative threat to the long-term well-being of babies who face multiple risk factors, such as those who are eligible for TANF. Research suggests that, rather than cutting benefits to babies, states should redesign TANF programs to meet the developmental needs of infants in TANF families, as recommended in the recent CLASP paper, TANF and the First Year of Life: Making a Difference at a Pivotal Moment.

The evidence is in on another point too.  Family cap policies don’t achieve their intended purpose of deterring childbearing among women and girls who are poor. Proponents hypothesized that welfare recipients might intentionally conceive a child to receive an increased benefit, to become exempt from mandatory work requirements or activities, or to remain eligible for the program. But studies of family cap policies have found no evidence of such effects. There is little evidence of any reduction in birth rates among women receiving TANF benefits when compared to non-TANF recipients in states with such policies. Instead, the main effect of family caps is to increase poverty among families with young children. One study found that the family cap significantly increases deep poverty (income less than 50 percent of the federal poverty level) among single mothers and their children.

It’s time for California to eliminate its maximum family grant policy. As the evidence against these policies accumulates, six other states have repealed their family cap policies since 2002, most recently Minnesota in 2013. As one of only 16 states that still have such policies, California accounts for more than half of the approximately 61,000 families nationwide that had their benefits reduced in 2013 due to a family cap policy—families that are highly likely to have infants or young children. Nationally, families affected by the benefit cap have received an average of 20 percent less in cash assistance than they would have otherwise received.

Family cap policies take money away from the most vulnerable families, with lasting consequences for both these families and society as a whole.  Children who are born into families experiencing poverty are far more likely than other children to spend more than half of their childhood in poverty, and to have worse outcomes as adults. In California, without the Maximum Family Grant rule, most affected households would receive an additional $128 per month in assistance for a newborn child—not enough to meet all of an infant’s basic needs but enough to pay for diapers and wipes.  Lifting the family cap would mitigate the financial burdens associated with deep poverty.

Earlier this year, legislation to repeal the Maximum Family Grant cleared the California Senate with bi-partisan support. As early as January, it will be eligible for a vote in the Assembly, where it received bi-partisan votes at committee hearings. California Governor Jerry Brown hasn’t taken a position on the policy but has indicated his desire to discuss the repeal in budget negotiations rather than be sent the bill for signature in 2016.  I urge Governor Brown to include funding to repeal this harmful and outdated provision in his forthcoming budget proposal. The evidence is in, and the family cap should be out.  

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. 

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