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Temporary Assistance for Needy Families: an overview.

In 1996, Congress and the White House agreed to "end welfare as we know it" and passed the Personal Responsibility and Work Opportunity Reconciliation Act. This landmark legislation transformed the longtime cash payment entitlement program, Aid to Families with Dependent Children, into a state block grant program, Temporary Assistance for Needy Families. TANF let states provide time-limited assistance to move clients into work and promote family stabilization as efficiently as possible. Congress gave states explicit authority to design TANF assistance in whatever way they felt best let them meet their individual goals, so long as state plans complied with the broad goals in the statute; state spending was maintained at a federally mandated level; and states were demonstrating that they were reducing caseloads and meeting required work participation rates.

The decrease in families on cash welfare assistance has been dramatic. According to the House Ways and Means Committee's "Green Book," in 1996, 5.1 million families were collecting cash assistance, but this number had dropped to 1.9 million families by 2006. State TANF spending was framed by the statute's four nationally mandated goals: (1) assisting needy families so children can remain with their families; (2) reducing dependency of needy parents by promoting job preparation, work and marriage; (3) preventing out-of-wedlock pregnancies; and (4) encouraging the formation and maintenance of two-parent families. Congress further prohibited the HHS from regulating TANF except as explicitly allowed in the statute.

In its early years, TANF's flexibility allowed states to design programs that not only used cash assistance but also leveraged a host of other assistance services to help families. This let states continue to help families when heads of households moved into the workforce, yet were still in need of additional support, so they did not relapse into dependence on cash assistance. Now, more than a decade after TANF replaced AFDC, there is no longer any question that states and localities can design and implement effective welfare-to-work programs, and that legions of poor, single mothers can secure and retain employment. The positive results since 1996 have surpassed all realistic expectations and include:

* Many more single mothers with children who live below the poverty line are now employed;

* 8 percent fewer children are in poverty; and

* 60 percent fewer families are receiving cash assistance.

As the nation confronts the worst economic crisis in more than three generations, TANF, along with tax benefits and other support services, has a critical role to play in combating family poverty by providing cash assistance to enable poor families to maintain housing, helping poor parents secure and retain employment, and assisting low-income working parents to achieve economic self-sufficiency.

TANF was designed as a powerful, but limited, tool to help certain low-income families, and coupled with other programs and strategies, has enabled states to make remarkable progress. However, vulnerable families still endure many deficits:

* Too many families that have left TANF with employment are mired in low-wage jobs that keep them at or near the poverty level.

* Over the period of 1996 to 2005, 128 percent more single-parent families in poverty became disconnected, with no cash assistance and no employment.

* Fewer than 25 percent of poor children and fewer than 40 percent of families who are poor enough to receive TANF assistance under their own state's eligibility rules actually receive TANF assistance.

Although the TANF program has made considerable strides in helping vulnerable families and individuals, over the past several years conflicting federal policy decisions have undermined the innovative spirit of TANF, a cornerstone of the bipartisan welfare reform effort more than a decade ago. Federal actions in recent years have included:

* Imposition of a rigid and narrowly focused work participation rate on the program that addresses only one measure among a range of program outcomes, and that is accompanied by extensive verification plans and punitive sanctions;

* Initiated a nearly identical version of the former AFDC national quality control program--which Congress explicitly rejected in the 1996 law--through a series of intensive and ill-conceived audits in a growing number of states;

* Issued a regulation that severely restricted state maintenance-of-effort expenditures under purposes 3 and 4 of the statute;

* Published a proposal, based on unsubstantiated justification, to eliminate states' ability to use their excess MOE expenditures for credit toward their caseload reduction credit. APHSA and its affiliate, the National Association of State TANF Administrators, have strongly objected to these actions as in conflict with the nature and intent of the TANF program and inimical to the states' flexibility in administering this block grant. APHSA's and NASTA's work on this issue has resulted in the Obama administration's agreement to withdraw the excess MOE proposal. The program, however, still stands in need of significant changes to remove a number of restrictive changes from recent years and to allow it to respond more adequately to the kind of severe economic crisis now facing the nation.

TANF's 2005 Reauthorization

The first reauthorization of TANF, originally due in 2002, presented an ideal opportunity to take stock of the program's successes and its limitations, and engage in a rich debate over how to build on TANF's achievements to more effectively reduce family poverty. Sadly, this opportunity for a broad and sweeping examination of how successful TANF has been in addressing poor families' true needs was lost. Also lost was a valuable opportunity to critically examine the limitations of the TANF program and how these shortfalls could be addressed to produce better outcomes for the people TANF serves. Instead, national policymakers in both Congress and the administration placed undue focus on TANF procedural changes, including calculation of the work participation rate and onerous work verification procedures, resulting in a reauthorization through the reconciliation process that was in many ways a step backward.

When TANF reauthorization was finally passed as part of the Deficit Reduction Act of 2005, the U.S. Department of Health and Human Services followed with a number of regulations that further limited the valuable flexibility states have used to produce better outcomes for needy families. Now, as states struggle with an extended and painful economic downturn, and as millions find their unemployment insurance dwindling and face the possibility of turning to assistance programs, states are looking at an increasingly challenging environment for meeting TANF's current narrow requirements. The states' task is exacerbated because the relatively easy cases to move off TANF have already left the program, and those remaining on the caseload often have multiple work barriers. Since the 2005 reauthorization went into effect, states and localities have been forced to devote a disproportionate amount of energy and scarce resources to the technicalities of the work participation rate and new work verification plans, to the detriment of serving poor families and helping low-income working families progress to better employment. Moreover, the earlier Administration for Children and Families process-based regulations and similar administrative requirements that still remain in effect continue to restrict state flexibility and distract state and local agencies from the urgent task of helping poor and low-income families.

Policy Agenda

State and local TANF agencies want to work with the administration and Congress to reestablish the spirit of partnership, flexibility and accountability that was the basis for TANF's tremendous successes during its earlier years. States agree that a reasonable level of accountability is proper in a federal block grant. However, the great achievement of TANF was that it rewarded states for innovation and encouraged administrators to take the actions they deemed necessary to help the unemployed overcome unique barriers that varied by the state and the individual. The program works because of that flexibility, yet in recent years the state-federal discourse had moved away from flexibility and program outcomes to more emphasis on process and accountability. APHSA and NASTA are encouraged by the fresh dialogue that has taken place with the administration in recent months and look forward to continuing this productive engagement with all policymakers and stakeholders during the program's reauthorization next year.


The TANF program can include both accountability and flexibility so long as states are being held accountable for outcomes that are under their control and that represent true progress for needy families toward the program's statutorily defined goals. States call on national policymakers to join in making these improvements as TANF approaches its next reauthorization milestone in 2010.

Robert Ek is APHSA's legislative associate. Larry Goolsby is APHSA's legislative director.
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Author:Ek, Robert; Goolsby, Larry
Publication:Policy & Practice
Geographic Code:1USA
Date:Feb 1, 2010
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