Mixed result: Poverty persists despite assistance drop

By Chris Stewart

A landmark reform bill inspired by Republicans and signed by Democratic President Bill Clinton 20 years ago this week proclaimed an end to “welfare as we have come to know it.”

But while the Personal Responsibility and Work Opportunity Reconciliation Act resulted in a dramatic decrease in cash assistance — cutting millions of people from the assistance rolls — an investigation by this news organization shows the welfare-to-work law fell far short of its promise of a “new beginning” for those in poverty’s grip.

At the signing, attended by members of both parties, Clinton said the bill would “help people to go to work so they can stop drawing a welfare check and start drawing a paycheck.”

Time limits were placed on how long a person could receive benefits, and recipients were given work requirements. The new law also tightened conditions for getting food stamps and reduced welfare assistance for immigrants.

The result was stark. About 5.1 million families in 1994 received payments during cash welfare’s peak under the former program, Aid to Families with Dependent Children. By the end of 2014, the number receiving assistance through the new program — Temporary Assistance to Needy Families (TANF) — had dwindled to about 1.7 million families. Children account for about three-quarters of the four million individuals now receiving cash assistance.

“TANF just basically has become the emblematic example of the shredding of the safety net,” said Michael R. Smalz, senior attorney at the Ohio Poverty Law Center.

“There’s been a drastic reduction, a purging of the rolls for various reasons,” he said. So only a tiny fraction of Ohio children who are living in poverty are now receiving some form of cash assistance.”

Not everyone views the law as a failed effort. Matt A. Mayer, president of the right-leaning Opportunity Ohio, said TANF worked as advertised during the first decade, pushing able-bodied adults into the workforce.

But a rapidly changing economy and the Great Recession exposed chinks in the “one-size-fits-all” public assistance program as whole sectors of employment evaporated and a skills gap developed for those remaining, Mayer said.

“Where we see problems, is frankly, there are job vacancies in well-paying jobs where there’s not people who can do those jobs from a technical trade standpoint,” he said.

Even one of the main architects of the bill says fixes are needed today.

Ohio Gov. John Kasich, who sponsored the 1996 U.S. House bill that turned into the law Clinton signed, requested a federal waiver last year from stringent work-hour requirements so more time could be put toward training, skills development and education.

TANF continues to receive a huge investment of public funds. Ohio Works First — the TANF program in Ohio — gets $728 million from the feds and $450 million from the state. The program is administered under Kasich’s director of the Ohio Department of Job and Family Services, Cynthia Dungey, who told federal lawmakers last year that the national TANF program had strayed from its original purpose.

There is little ability to customize casework to a client’s employment needs, Dungey told a U.S. House subcommittee, arguing that caseworkers waste valuable time doing “mathematical gymnastics” documenting their clients’ activities.

Dungey also said too many of the workshops run by outside contractors give clients “menial tasks disconnected from the skills needed in the job market.”

“It’s hard to believe such programs were a part of Congress’ original vision for welfare reform in 1996,” she testified.

‘It isn’t worth it’

Those who have been in the program say there is an Achilles heel for all welfare to work programs: What if there is no work?

“This town doesn’t have a whole lot of job opportunities,” said Christina Wallace of Springfield. “You can’t find a job in Springfield unless you want fast food and a lot of people don’t want to make a career out of fast food. I’ve had a lot of temp services calling me for jobs on the other side of Columbus. That’s a long way to drive for $9 an hour. It isn’t worth it.”

Wallace, 41, signed up for TANF not long after the law went into effect in 1997. She had separated from her husband, had two small children and was homeless, a plight often shared by many recipients.

She has since worked a string of subsistence-level jobs: six years as a restaurant server, then sporadically at temp jobs including washing bio-hazard-contaminated laundry at a medical facility and most recently as an inspector at a heat treating plant. The jobs paid $9 to $11 an hour. She finds herself out of work again; still listed on her resume is a Windows 98 certificate earned while on TANF years ago.

Natasha Ohlinger of Springfield said the four months she spent on TANF stuck with her.

“If I were to go back to work today I’d know exactly what to do, what I’d have to have ready for an interview, how I’d need to be dressed, how I need to present to myself,” said Ohlinger, 31, who says she helps out with boyfriend’s tree-trimming and asphalt business.

Now a mother of five children, Ohlinger said she entered the program when she was about 24 and needed help providing for her oldest two boys.

“At the time I was homeless,” she said. “I just lost my house. I was trying to get everything together.”

Skills gap

Studies show TANF work requirements push people into the labor market sooner, but at the expense of stable, long-term employment that comes from further education and training. While results vary widely by state — and even county-to-county — one study showed as few as 22.1 percent and no more than 40.8 percent of TANF recipients achieved stable employment three to five years after enrolling in the program.

“If I had a magic wand I would give everyone the skills and the training they need in order to fill the jobs we have in the county,” said Patrick Bailey, deputy assistant director, Montgomery County Department of Job and Family Services. “We have a whole bunch of jobs. A lot of the problem is we don’t have individuals with the skills and abilities to do those jobs. If we could match those it would make a huge difference.”

Sade Seidynaly of Dayton is grateful for the assistance she received through Ohio Works First. It helped her through a rocky time, she said. But one of her work assignments was sorting shoes at Goodwill, a job that she says did nothing to help set her up for more lucrative work.

Seidynaly said she signed up for assistance through Ohio Works after a childhood of “wacko parenting,” and later bouts of homelessness and a bad marriage left her with two small children to care for. Now a single parent with three children — ages 2, 8 and 9 — Seidynaly long ago exhausted the 36 months of cash assistance Ohio allows.

After sporadic, low-wage employment — made more difficult because of the inability to find affordable childcare – Seidynaly was hired recently as a hair stylist at a salon.

Poverty experts say Seidynaly’s story is all too familiar.

The shortcomings of TANF put far too many Americans into precarious futures relegated to low-paying, unstable, part-time or temporary work with unpredictable hours, Smalz said.

“The bottom line is that hasn’t translated into greater economic well being,” he said. “It certainly hasn’t translated into lower rates of poverty or child poverty and in some cases for those people who are out of the workforce for some time it has translated into much greater levels of extreme poverty.”

Barriers to employment

To be self-sufficient in Ohio without any government supports — the program’s desired outcome — a family of one adult and two children would need an annual income of $27,644, or $13.30 an hour, according to a 2015 report to Gov. Kasich from the Ohio Workgroup to Reduce Reliance on Public Assistance.

But it appears few unskilled single-parent workers will be able to inch above that income threshold any time soon.

Of the top 10 jobs projected to offer new employment in the state through 2022, seven average below $13.30 an hour and two others barely rise above that wage. The most job openings are forecast for food service and fast food workers who averaged $8.75 an hour in 2013.

Registered nurse — seventh on the list with an average pay of $29.10 an hour — was the only job with compensation comfortably above the governor’s workgroup figure.

The problem is, nursing and other in-demand high-skill jobs require advanced training and often post-secondary degrees that are beyond the reach of most of those in the Ohio Works First program. Drug use, lack of child care and transportation and an often complicated home life are all barriers to a successful transition to the workplace.

In 2012, just seven percent of those counted in the participation rate were in educational and training programs.

The existing rules, too, pose a barrier, officials say.

While TANF recipients can count education toward their “core” activities, allowing them to stay in the program and continue receiving assistance, that credit lasts only 12 months. It’s difficult to earn some certificates during that time, officials say, and virtually impossible to earn a degree.

“I don’t think 12 months is enough,” said Bailey, who helps oversee the program in Montgomery County. “When there’s not a lot of flexibility it hurts our ability to really help people the way we would like.”

The state’s still-pending waiver request asks for 36 months, which Bailey says is much more realistic.

“If they get that degree, they’re probably never going to be back in (our) door,” he said.

Benefit drop

Not only are fewer families on assistance as a result of the 1996 law, the amount of assistance has been reduced substantially.

Almost a third of the states have never raised the monthly benefit, ignoring 20 years of inflation. In Mississippi, each member in a family of three receives $1.86 a day. In Arizona, benefits dropped in half when factoring in inflation.

The benefit today for a single-parent family of three in Ohio is $473 a month. Although that amount has been raised since the law was enacted, in real dollars it’s about 9.1 percent less.

Linda Cook, a senior attorney who works with Smalz at the Ohio Poverty Law Center, suggests the reduction in the rolls is due to a wanton state effort to push as many people off the program as possible. Improvement in the work participation rate is the only measure by which TANF is judged, she said, and failure to meet the rate draws fiscal penalties.

“There are restrictions on the amount of time participants can spend in certain activities, so it really puts pressure on states to perform,” Cook said. “Ohio, sadly, has chosen to improve their performance basically by eliminating or reducing the number of people on the rolls.”

A 2013 report commissioned by the state noted that work participation rates had improved not by providing services or moving people to employment, but rather by sanctioning recipients out of the system.

State statistics for this past July showed only 12 percent left the program because they earned enough to no longer qualify for assistance.

“As caseloads decline, well, maybe those indicators look really good. But those seem to me to be the wrong measure of effectiveness,” said Hannah Halbert, a policy liaison with the left-leaning group Policy Matters Ohio. “I think that some of the reasons that we are in this place with TANF and the reforms is that it was based around some assumptions around poverty and work that are certainly wrong now.”

Michael McCreight, an assistant director of the Ohio Department of Job and Family Services, said the state has done its best to serve those in need, initiating a new program July 1 that targets 16- to 24-year-olds and offers more comprehensive case management.

But McCreight said changes are needed on the federal level.

“The way (TANF) is sliced and diced really puts the caseworker at a disadvantage meeting the individual needs of a particular client,” he said.

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