SECTION 7. TEMPORARY ASSISTANCE FOR NEEDY FAMILIES (TANF) CONTENTS Brief Summary and History Basic Outline of Program Purpose Allowed Uses of Block Grants Major Conditions Attached to TANF Grants Benefits Child Care Interaction with Other Major Benefit Programs Privatization/Charitable Choice Enforcement of Penalties Against States State TANF Programs State Plan Requirements Brief Summary of TANF State Programs Funding of TANF Basic Family Assistance Grants State Spending Requirement (MOE) Supplemental Grants to States with High Population Growth and/or Low AFDC-Related Federal Spending Per Poor Person Welfare-to-Work Grants Contingency Fund Loan Fund Bonus Funds TANF for Indians AFDC/TANF Data Highlights Caseloads Benefits Break-Even Levels Uses of TANF Funds Expenditures Work Activities and Participation Characteristics of AFDC/TANF Families Composition of Families, 1969-98 Marital Status of Parents Race and Ethnicity of AFDC/TANF Adults Educational Attainment of TANF Adults Living Arrangements of TANF Children Welfare-to-Work (WTW) Grant Program Welfare Dynamics Duration Findings Exits and Returns to AFDC/TANF Selected Provisions of State TANF Programs Legislative History References BRIEF SUMMARY AND HISTORY Enacted in August 1996 after 2 years of debate, the Personal Responsibility and Work Opportunity Reconciliation Act (Public Law 104-193) repealed the 61-year-old program of Aid to Families with Dependent Children (AFDC; see Committee on Ways and Means, 1998, pp. 401-405) and created the Block Grant Program of Temporary Assistance for Needy Families (TANF) in its place. The law entitles States to fixed block grants ($16.5 billion annually) for 6 years to operate programs of their own design, but imposes time limits on receiving welfare without working, lifetime benefit time limits, and minimum work participation rates. Within limits, it allows States to reduce their own spending on behalf of needy children. The 1996 law also sharply expands funding for child care. Frustration with the character, size, and cost of AFDC rolls contributed to the decision by Congress to ``end welfare as we know it'' in 1996. Enrollment had soared to an all-time peak in 1994, covering 5 million families and more than one- eighth of U.S. children. More than half of AFDC children were born outside marriage, and three-fourths had an able-bodied parent who lived away from home. Almost half of the families had received benefits for more than 5 years, counting repeat spells. Benefit costs peaked in fiscal year 1994 at $22.8 billion ($12.5 billion in Federal funds, $10.3 billion in State/local funds). Some policymakers urged that Congress put a cap on AFDC funds to control costs. Some maintained that offering permanent help for needy children in single-parent families had encouraged family breakup, enabled nonmarital births, and fostered long-term dependency. Repeated efforts by Congress dating back to the 1960s to reduce welfare use and promote self-sufficiency generally had been discouraging. Reform measures had included ``rehabilitative'' services; work requirements, work rewards; education and training; support services including child care; child support enforcement; and provisions to establish paternity of nonmarital children. In 1988, Congress enacted the Family Support Act, which stressed the mutual obligation of government and welfare recipient to promote self-sufficiency of AFDC families. In the early 1990s many States received permission, through waivers from one or more AFDC Federal rules to test their own reform ideas--special behavioral rules, rewards, penalties, and welfare-to-work (WTW) strategies. By early 1995, many Governors pressed for a cash welfare block grant to free them from AFDC rules. The concept of a fixed block grant that States could use for temporary and work- conditioned programs of their own design was included in reform bills passed by Congress in 1995 and 1996; both were vetoed. But a third bill that included changes discussed during the 2 years of debate was enacted by Congress in July 1996 and was signed by President Clinton on August 22, 1996. By the time of TANF's passage, AFDC enrollment had decreased to 4.4 million families. The mandatory start date for TANF was July 1, 1997, but most States made the transition from AFDC earlier. TANF combined into a single block grant peak-year Federal funding levels for AFDC benefits and administration and two related programs--Emergency Assistance to Needy Families (EA) and the Job Opportunities and Basic Skills Training Program (JOBS). TANF entitles each State to an annual family assistance grant equal to the largest yearly amount paid by the Federal Government to the State for AFDC benefits and administration, EA, and JOBS during the fiscal year 1992-95 period. From their own funds, States are required to spend on needy families at least 75 percent of their ``historic'' level, defined as fiscal year 1994 spending on programs replaced by TANF, including AFDC-related child care. This is known as the maintenance-of- effort (MOE) rule. (If a State fails to achieve a required work participation rate, its MOE rises to 80 percent.) The 1996 welfare law also provided supplemental grants for some States with above-average population growth and below- average fiscal year 1994 Federal welfare spending per poor person, bonus funds for reducing nonmarital birth rates while also reducing abortion rates, bonus funds for high performance, and a contingency fund for States with failing economies. In 1997, Congress added to TANF a special WTW Program of matching formula grants and some competitive grants, with funding for fiscal years 1998 and 1999 only. The TANF law makes family assistance grants available to the outlying areas of Guam, Puerto Rico, and the Virgin Islands, all of which participated in AFDC. American Samoa was eligible for AFDC but did not operate the program; it could participate in TANF under special rules that provide a 75 percent Federal match. It also permits Indian tribes, defined to include Alaska Native organizations, to conduct their own tribal family assistance programs. Indian tribes had been excluded from operating AFDC, although some tribes conducted their own JOBS Program. Major differences between TANF and AFDC include: --Entitlement.--TANF expressly denies entitlement to individuals. Under AFDC, States were required to aid all families eligible under State income standards. --Funding.--TANF law preappropriates a fixed family assistance grant for each State, plus some extra funds. To avoid fiscal penalties, States may not reduce their own spending by more than 20-25 percent (MOE rule). States must provide matching funds for WTW grants. AFDC law provided unlimited matching funds for AFDC and EA, but put a ceiling on matching funds for JOBS. --Time limit for benefits.--TANF sets a 5-year limit on federally funded aid, with a 20 percent hardship exemption. AFDC had no time limit. --Work trigger.--TANF requires work (defined by the State) after a maximum of 2 years of benefits. AFDC had no work trigger. --Work requirement.--TANF requires a specified and rising percentage of the total caseload to engage in work activities listed in the law. The JOBS Program had participation requirements, but participation did not require work and about half the caseload was exempted. --Eligibility.--TANF allows States to decide what categories of families to aid. AFDC prohibited aid for children in two-parent families unless the second parent was incapacitated or unemployed. --Treatment of earnings.--Under TANF, States decide whether to disregard some earnings as a work incentive, and, if so, how much. AFDC law set rules about treatment of earnings. Two basic program features of AFDC were retained by TANF. States decide how needy families must be to receive aid, and States establish maximum benefit levels (Burke, 1999). BASIC OUTLINE OF PROGRAM Purpose Section 401(a) of the Social Security Act says that the purpose of TANF is to increase flexibility of States in operating a program designed to: 1. Provide assistance to needy families so that children may be cared for in their own homes or in the homes of relatives; 2. End the dependence of needy parents on government benefits by promoting job preparation, work, and marriage; 3. Prevent and reduce the incidence of out-of-wedlock pregnancies and establish annual numerical goals for preventing and reducing the incidence of these pregnancies; and 4. Encourage the formation and maintenance of two-parent families. Allowed Uses of Block Grants The law provides that States may use their family assistance grant ``in any manner reasonably calculated'' to promote any of the four goals above. Expenditures for the first two goals must be made on behalf of needy families, but spending aimed at the latter two goals--reduction of nonmarital pregnancies and promotion of two-parent families--may be made for nonneedy families. States also may use TANF funds to continue other activities not related to the four program objectives that they were authorized to undertake in individual State plans under AFDC, EA, or JOBS. They may make limited transfers of TANF funds (totaling 30 percent) to the Child Care and Development Block Grant (CCDBG) and the Social Services Block Grant (title XX), with the title XX transfer no greater than 10 percent (4.25 percent effective October 1, 2000). They may use TANF funds (within overall transfer limits) as matching funds for job access grants.\1\ The law also explicitly permits States to use TANF funds to fund individual development accounts established by persons eligible for TANF assistance. Clearly, TANF is a funding stream for a variety of allowed purposes, not just a program of cash welfare aid. --------------------------------------------------------------------------- \1\ Authorized by Public Law 105-277, job access grants are matching grants to local governments and nonprofit organizations for transportation services, including reverse commuter projects for welfare recipients and other low-income persons (U.S. General Accounting Office, 1999). --------------------------------------------------------------------------- TANF funds may be carried over from fiscal year to fiscal year without limit. However, carried over funds may be spent only for ``assistance.'' The law does not define assistance, but final regulations adopted by the U.S. Department of Health and Human Services (DHHS) restrict it to benefits designed to meet a family's ``ongoing basic needs'' (that is, for food, clothing, shelter, utilities, household goods, personal care items, and general incidental expenses) plus supportive services such as transportation and child care for families who are not employed. Funds used for nonassistance (including nonrecurrent, short-term benefits, work subsidies, and supportive services to employed families) must be obligated by the end of the fiscal year for which they are awarded, and expended by the end of the next year. TANF funds cannot be used to: fund activities required under the State plans of child support enforcement or foster care and adoption assistance; finance the construction or purchase of buildings; finance a funding deficiency in another Federal program; provide medical services other than prepregnancy family planning services; or assist a family that includes a person who, as an adult or minor household head, has received 60 months of assistance. Administrative costs may not exceed 15 percent except in the case of expenditures for information technology and computerization needed for tracking or monitoring. Major Conditions Attached to TANF Grants TANF sets some eligibility/ineligibility conditions; it imposes work rules and sets a 5-year time limit for federally funded benefits; it requires States to spend certain sums of their own funds on needy families--MOE rule; it allows waiver from its rules under restricted conditions; and it requires States to report certain expenditure data and some data on recipient families. Eligibility/ineligibility A State may give TANF assistance to a family only if it includes a minor child or pregnant person. To be eligible, families must assign child/spousal support rights to the State. Ineligible are unwed mothers under 18 and their children unless they live in an adult-supervised arrangement (for good cause the State may waive this rule) and (if a high-school dropout) attend school once their youngest child is 12 weeks old. Ineligible for 5 years are noncitizens who enter the United States after the Personal Responsibility and Work Opportunity Reconciliation Act's August 22, 1996 enactment. States that use their own funds to help legal immigrants and minor parents not living in an adult-supervised setting may count this spending toward their required MOE. Also ineligible are fugitive felons and violators of probation/parole and, unless the State opts out by State law, persons convicted of a drug-related felony for conduct occurring after the law's 1996 enactment. Work rules TANF law sets work trigger time limits, requires States to achieve minimum rates of work participation, requires States to penalize work infractions by recipients, and sets fiscal penalties for States that fail to achieve participation rates. The Labor Department has ruled that the Fair Labor Standards Act (which governs hours and wages) applies to most ``workfare'' programs in which TANF recipients participate in exchange for their benefit. Work trigger rule (State definition of work).--In their TANF plans, States must outline how they intend to require parents and other caretaker relatives who receive TANF assistance to engage in work, as defined by the State, after a maximum of 24 months of benefits or earlier. More than half of the States have adopted the Federal maximum of 24 months as their work trigger time limit. More than a dozen say they require immediate work activity, such as job search. In many States the TANF recipient who takes a paid job remains eligible for a reduced TANF benefit until reaching the State's absolute benefit cutoff; this is especially likely if the work is part time and the wage rate is relatively low. TANF law also sets a 2-month community service trigger, with tasks and required hours to be decided by States, for recipients not engaged in or exempt from work, but allows States to opt out by notification of the Governor to DHHS. Only four States (Michigan, New Mexico, South Dakota, and Wisconsin) use this 2-month workfare trigger; the others have opted out. However, some other States specify that after a longer period unemployed TANF recipients will receive aid only if they perform community service or other work in exchange for their benefits. For instance, California allows aid beyond 18 months for those not otherwise working only if the county determines that a job is unavailable and the recipient participates in community services. Delaware and Pennsylvania have similar requirements. Minimum work participation rates (Federal definition of work).--States must achieve minimum rates of participation by adult recipients (or teen parent recipients) of TANF assistance in one or more of 12 activities listed in the statute. The statutory rates, which began in fiscal year 1997 at 25 percent for all families and 75 percent for two-parent families, rose by stages to 40 percent and 90 percent, respectively, in fiscal year 2000; the all-family rate is to climb to a final peak of 50 percent in fiscal year 2002. However, the law requires DHHS to reduce a State's required participation rates if average monthly caseloads are below those of fiscal year 1995. For each percentage point drop in the caseload not attributed to State policy changes, the required work rate is lowered by 1 percentage point. The caseload dropped so sharply between fiscal year 1995 and fiscal year 1997 that all States exceeded their adjusted all-family target rates, which in some cases plunged to zero. However, 15 jurisdictions failed the higher two-parent work rate, even after adjustment (table 7-21). A State's monthly participation rate, expressed as a percentage, equals: (1) the number of families receiving ``assistance'' that include an adult or minor head of household who is engaged in creditable work for the month, divided by (2) the number of all families receiving assistance that include an adult or minor household head recipient (but excluding families subject that month to a penalty for refusal to work, provided they have not been penalized for more than 3 months in the preceding 12 months; and excluding families with children under 1, if the State exempts them from work). The same method is used to calculate participation rates of two-parent families. Creditable work activities.--The creditable work activities can be grouped by priority. In the first priority group are nine activities: (1) unsubsidized employment; (2) subsidized private employment; (3) subsidized public sector employment; (4) work experience; (5) on-the-job training; (6) job search and job readiness assistance (6 weeks maximum of job search, with 12 weeks allowed under certain unemployment conditions); (7) community service programs; (8) vocational educational training (12 months maximum); and (9) providing child care for a community service participant. In the second priority group are three activities: (1) job skills training directly related to employment; (2) education directly related to employment (high school dropout only); and (3) satisfactory attendance at secondary school or in an equivalent course of study (high school dropout only). Not more than 30 percent of families may be credited with work activity by reason of vocational education training or, if teens without a high school diploma, by reason of secondary school attendance or education directly related to employment. Required hours of work participation.--To be counted as a work participant, a TANF recipient generally must be engaged in one of the above creditable activities for at least 30 hours per week, on average, in fiscal years 2000-2002 (fewer hours were required in earlier years), and 20 of those hours must be in one of the nine high-priority activities. The law provides two exceptions to this rule: (1) if a TANF recipient is the only parent or caretaker relative of a child under age 6, she need work only 20 weekly hours, all in high-priority activities; and (2) if a TANF recipient is a single teen household head or married teen without high school diploma, he may receive work credit by maintaining satisfactory high school attendance, or, for an average of at least 20 hours weekly, by engaging in schooling directly related to work. Special rules apply to two-parent families. They must work at least 35 hours weekly, with at least 30 hours in high-priority activities (the two parents may share the work hours). If the family receives federally funded child care and an adult in the family is not disabled or caring for a severely disabled child, the shared work requirement rises to 55 hours, of which 50 hours must be in first priority activities. If the second parent in a two- parent family is disabled, the State must treat it as a single- parent family. Penalties to enforce work rules.--TANF law prescribes penalties against States that fail participation rates, and it requires States to penalize recipients for work refusal. If a State falls short of the required participation rate for a fiscal year, its family assistance grant for the next year is reduced by 5 percent (first failure). For subsequent years of failure, annual penalties rise by 2 percentage points (thus, 7 percent in second year, 9 percent in third, etc.) with a maximum penalty of 21 percent in any one year. However, the law says that grant reductions shall be based ``on the degree of noncompliance,'' and the Secretary may reduce the penalty if noncompliance was due to a specified high rate of unemployment or to ``extraordinary circumstances, such as a natural disaster or regional recession.'' Before assessing a penalty, the Secretary must notify the State of its violation and allow it to enter into a corrective compliance plan. DHHS has indicated that most States that failed fiscal year 1997 or 1998 two- parent work participation rates have filed corrective action plans. If an adult recipient of assistance refuses to engage in work, the law requires the State to reduce aid to the family ``pro rata'' (or more, at State option) with respect to the period of work refusal, or to discontinue aid, subject to good cause and other exceptions that the State may establish. However, a State may not penalize a single parent caring for a child under age 6 for refusal to work if the parent cannot obtain needed child care for a reason listed in the law. The law does not define ``pro rata'' reduction, and the regulations do not prescribe a method. States have adopted various penalties for failing to comply with work requirements: about one-third end the family's benefit for a first violation; most make a partial benefit cut (removing the adult from the grant); penalties are increased in size or duration for repeat violations. TANF law also explicitly permits a State to reduce a family's benefit, by an amount the State considers appropriate, if a family member fails without good cause to comply with an individual responsibility plan that she has signed. Most State TANF plans include use of individual responsibility plans that establish an employment goal, set forth obligations of the recipient, and describe services to be provided by the State. Nondisplacement.--A TANF recipient may fill a vacant position, but may not be assigned to a position from which a worker has been laid off. Lifetime federally funded benefit time limit A State may not use any part of its family assistance grant to provide assistance to a family that includes a person, who as an adult (or minor household head) has already received 60 months of assistance. However, States may exempt 20 percent of the caseload from the Federal time limit for ``hardship'' reasons or because the family includes a person who has been ``battered or subjected to extreme cruelty.'' If a State uses its own funds for families that have reached the Federal time limit, it may count the expenditures toward its MOE requirement. States may establish their own time limits (within 60 months) for use of Federal funds and (without limit) for use of their own funds. Almost half the States have adopted limits shorter than 60 months. Some permit extensions, some provide exemptions (months that do not count toward the time limit), and some continue children's benefits indefinitely (Falk, 1998). Family violence waivers The 1996 law allows States to certify in their TANF plans that they have adopted standards to screen and identify TANF recipients with a history of domestic violence, refer them to services, and waive program requirements (including time limits and work rules) in some cases. DHHS regulations allow a State that has adopted the family violence option to receive ``reasonable cause'' exceptions to penalties for failing work and time limit rules if the State had granted domestic violence waivers that meet certain standards. Data reporting Regulations covering data reporting rules of the 1996 law took effect October 1, 1999. Before then, an Emergency TANF Data Report was used. The 1996 law requires States to collect on a monthly basis, and report on a quarterly basis, certain case-by-case information about families \2\ receiving assistance (defined by regulation as benefits for ongoing basic needs plus support services for nonemployed families) under the State program funded by TANF. Reports must provide some data for each family, each family member, and each adult. Required data include amount of assistance and type, type of family, cash resources, child support received (family data); race/ ethnicity, educational status, citizenship status (for each family member); and marital status, employment status and earnings, and disability status (for each adult). Under DHHS regulations, if a State wishes to receive a high-performance bonus or qualify for a caseload reduction credit (to lower its required work participation rate), it must also file a similar quarterly case-by-case report on families receiving assistance under separate State programs (SSPs), financed with MOE funds. Disaggregated (case-by-case) data also must be reported about families no longer receiving assistance. Reports about closed cases are to show data for the last month of assistance; States are not expected to track ex-recipient families for these reports. --------------------------------------------------------------------------- \2\ TANF law does not define ``family.'' Instructions to the TANF regulations say that for reporting purposes family means all persons who receive assistance as part of the family under the State TANF Program or the separate State program plus (if not included in the foregoing recipient group) parent(s), caretaker relative(s) and minor siblings of any child recipient, and anyone whose income or resources would be counted in determining the family's eligibility for or amount of aid. --------------------------------------------------------------------------- Also required are quarterly reports providing aggregated numerical totals, which may be based on sampling about families applying for, receiving, and no longer receiving assistance under the State TANF Program. In addition, if the State wants to qualify for a high-performance bonus or a caseload reduction credit, it must submit quarterly reports on the State MOE Program. Other required reports from States include: an annual report on State TANF and separate State MOE Programs; a quarterly report on expenditures; and, for States competing for an annual high-performance bonus, a quarterly report on measures of job entry and success in the work force. Benefits Most States have continued pre-TANF maximum benefit schedules, although some have reduced benefits for families expected to work (tables 7-9 to 7-13). Some States have increased benefits, including California, West Virginia, Mississippi, and Idaho. Two have adopted bonuses, Oregon for cooperation with its work program and West Virginia for marriage. Wisconsin and Idaho have ceased adjusting benefits for family size. Most States have increased asset limits and work incentives (the portion of earnings disregarded in calculating benefits). Under TANF more than 20 States have adopted formal policies to divert applicants from enrollment. These States pay welfare diversion or welfare avoidance grants to help families meet temporary emergencies. The grants are generally lump-sum payments, usually with a maximum equal to several months of TANF benefits. Child Care Unlike AFDC, which required States to guarantee child care for recipients who needed it to work or study, TANF has no child care guarantees. However, the 1996 welfare law expanded the Child Care and Development Block Grant to pay for care for low-income families. Appropriated for this new block grant was $13.9 billion over 6 years, more than $4 billion above spending levels estimated by the Congressional Budget Office for the repealed AFDC-related child care programs. The law required States to integrate these mandatory funds with CCDBG discretionary funds and authorized $1 billion annually for fiscal years 1996-2002 for discretionary funding. DHHS has designated the combined mandatory/discretionary child care grants as the Child Care and Development Fund (CCDF). For more information, see the chapter on child care (Section 9). Interaction with Other Major Benefit Programs Medicaid Although the 1996 law repealed AFDC, it preserved AFDC eligibility limits for Medicaid use. States must provide Medicaid coverage and benefits to children and family members who would have been eligible for AFDC as it existed on July 16, 1996. States may lower AFDC income and resource standards to those in effect on May 1, 1988 (continuing a provision of old law) and may increase them by the percentage rise since July 16, 1996 in the Consumer Price Index for All Urban Consumers; they also may adopt more liberal methods of determining income and resources (for example, more generous disregard of earnings). In general, if a State's TANF eligibility limits are the same as or more restrictive than those of AFDC on July 16, 1996, all TANF children and adults must receive Medicaid. Also, all children born since September 30, 1983 are eligible for Medicaid if their family income falls short of the Federal poverty level. The law permits States to end Medicaid for adults who refuse TANF work requirements, but requires continued Medicaid for their children. The law also requires 12 months of medical assistance to children and adults who lose TANF eligibility because of earnings that lift counted income above the July 16, 1996, AFDC eligibility limit. Despite these provisions, an Urban Institute study found that from fiscal year 1995 to fiscal year 1997, when the average monthly number of AFDC/TANF families declined by 19 percent, the number of AFDC/TANF children and adults enrolled in Medicaid fell by 20 and 24 percent, respectively (Ku, 1999). The study, which defined Medicaid enrollment as the unduplicated number of persons signed up for Medicaid at any time in the fiscal year, showed that the number of children enrolled in Medicaid dropped by 2.3 million over the 2 years (to 9 million). In the same period the average monthly number of children enrolled in AFDC/TANF fell by 2 million (to 7.3 million). On December 6, 1999, DHHS announced in the Federal Register (p. 69202) that it proposed to add three new nonwork measures (including Medicaid coverage) to factors used to determine high-performance TANF bonus awards to States. Food assistance TANF recipients not living with others automatically are eligible for food stamps; States can opt to operate a simplified Food Stamp Program under which they may apply many of their TANF rules to determination of food stamp benefits for TANF families, so long as the program does not increase Federal costs. TANF recipients disqualified for violating TANF rules may be disqualified also for food stamps. If a TANF household's cash benefits are reduced for noncompliance with TANF rules, the State may also reduce its food stamp allotment by 25 percent, and may not increase food stamp benefits to offset the cash loss. TANF children automatically are eligible for free school meals and other child nutrition programs. Women, infants, and children enrolled in TANF automatically are income-eligible for the Special Supplemental Nutrition Program for Women, Infants, and Children (WIC). These provisions continue AFDC policy. Food stamp coverage is the second nonwork high-performance bonus measure proposed by DHHS. Effective in bonus year 2001, DHHS plans to base awards, in part, on the increase in the percentage of low-income working families with children who receive food stamps. An Urban Institute study reports that only 42 percent of eligible former cash welfare families received food stamps in 1997; their participation rate was similar to the traditionally low rate of working poor families (Zedlewski, 1999). Earned income credit (EIC) States have authority to decide whether to count EIC payments received by TANF recipients as income (the 1996 welfare law is silent on this issue). However, Public Law 105- 34 prohibits EIC payments for TANF recipients whose earnings are derived from work experience or community service. Privatization/Charitable Choice The 1996 law authorizes States to administer and provide TANF services (and those under Supplemental Security Income) through contracts with charitable, religious, or private organizations, a provision which often is called ``charitable choice.'' It authorizes States to pay recipients by means of certificates, vouchers, or other disbursement forms redeemable with these organizations. Any religious organization with a contract to provide welfare services must retain independence from all units of government and may not discriminate against applicants on the basis of religion. Furthermore, States must provide an alternative provider for a beneficiary who objects to the religious character of the designated organization. The charitable choice/privatization provision of the 1996 welfare law also covers food stamps and Medicaid, but it has not been implemented because food stamp and Medicaid law effectively require eligibility to be determined by a public official. For background and discussion of selected legal issues raised by charitable choice, see Ackerman (1999). Enforcement of Penalties Against States Penalties for any quarter cannot exceed 25 percent of the basic grant; unrecovered penalties must be carried forward into subsequent years. Penalty amounts are withheld from Federal block grant payments to the State; States must replace withheld Federal funds with their own funds. Here is an overview of the major penalties specified in the 1996 law: --Failure to maintain a certain level of historic State spending. If a State fails to maintain State spending equal to at least 75 percent of spending in 1994, the Secretary must reduce the following year's TANF grant by the shortfall in MOE spending. In addition, if the State received WTW grant funds for the year, the Secretary must reduce the following year's TANF grant by the amount of those WTW funds. --Failure to timely repay a loan from the Federal loan fund. The Secretary must reduce the TANF grant for the next quarter by the outstanding loan amount, plus the interest owed. --Failure to comply substantially with child support enforcement requirements. The Secretary must reduce the TANF grant for each quarter of noncompliance as follows: first finding of noncompliance, by 1-2 percent; second consecutive finding, 2-3 percent; and third and later findings, 5 percent. --Failure to replace Federal penalty funds with State funds. The Secretary may reduce the next year's TANF grant by the sum of 2 percent of the grant and the amount of State funds equal to the earlier grant reduction. --Failure to maintain 100 percent of historic State spending under the State TANF Program during a year in which the State received contingency funds. The Secretary must reduce the next year's TANF grant by the total amount of contingency funds paid to the State. In the case of some violations of TANF law, the Secretary may allow States to enter into corrective compliance plans or may allow a penalty exemption on grounds of reasonable cause for the violation. Here are the violations that permit corrective compliance or exemption: --Failure to comply with the 5-year TANF benefit limit (5 percent maximum); --Failure to enforce penalties required by the child support agency against TANF recipients who fail to cooperate with the Child Support Program (5 percent maximum); --Failure to submit a required report (4 percent; rescinded if the State submits the report before the end of the next fiscal quarter); --Failure to participate in the income and eligibility verification system (2 percent maximum); --Use of TANF funds in violation of the law (reduction of the next year's TANF grant by the amount of funds wrongfully used; if the violation is found to be intentional, an additional 5 percent); --Misuse of competitive WTW grants (an amount equal to the misused funds); --Failure to maintain aid for a single parent who cannot obtain care for a child under 6 (5 percent maximum); --Failure to reduce TANF aid for recipients who refuse without good cause to work (not less than 1 percent or more than 5 percent). STATE TANF PROGRAMS State Plan Requirements To be eligible for a family assistance grant, States must submit each 2 years a TANF plan that contains required elements. The plan must outline how the State intends to: (1) conduct a program that provides cash assistance to needy families and that provides parents with work and support services; (2) require a parent or caretaker recipients to engage in work, as defined by the State, after a maximum of 24 months; (3) comply with the requirement for participation in creditable work activities by certain percentages of adult recipients; (4) take steps to restrict the use and disclosure of information about TANF recipients; (5) establish goals and take action to prevent and reduce the incidence of nonmarital pregnancies; and (6) conduct a program providing education and training on the problem of statutory rape. Also, the document must indicate whether the State intends to treat families moving into the State differently from State residents, whether it intends to provide aid to noncitizens, and if so, provide an overview of the aid. The plan must contain certain certifications, including that the State will operate a Child Support Enforcement Program and a Foster Care and Adoption Program, that it will provide equitable access to TANF for Indians who are not eligible for aid under a tribal plan, and that it has established and is enforcing standards and procedures against program fraud and abuse. The plan may certify that the State has established and is enforcing standards and procedures to screen and identify recipients with a history of domestic violence and will refer them to services and waive some program requirements for them in certain cases. The law does not require the State plan to provide eligibility rules for aid, benefit levels paid, the content of work programs, or numerous other details. However, regulations that took effect October 1, 1999 stipulate that in order for State expenditures to count toward the MOE requirement, the families aided must be financially eligible according to the appropriate income and resource (when applicable) standards established by the State and contained in its TANF plan. The preamble to the regulations states that in order for a plan to be deemed complete, it must contain the financial eligibility criteria for eligible families in the State's TANF Program and all State or local MOE Programs and a brief description of the corresponding benefit provided under the TANF Program with MOE funds. The Workforce Investment Act of 1998 (Public Law 105-220) allows a State to submit a ``unified'' plan to the ``appropriate Secretaries'' covering one or more Workforce Investment Act activities or vocational education activities plus one or more work activities authorized under TANF, food stamps, or numerous other programs. The Secretary with jurisdiction over a program is authorized to approve the portion of the State unified plan dealing with that program (applying its plan requirements). A State with an approved unified plan cannot be required to submit a separate plan for the covered activity. Brief Summary of TANF State Programs On the basis of State Temporary Assistance for Needy Families (TANF) plans, State welfare laws, and data collected under interim reporting rules, the range of State programs is shown to be broad. As noted earlier, many of the States have adopted time limits shorter than the Federal 60-month limit. In 1999, many State legislatures liberalized some TANF rules, allowing more TANF recipients to engage in postsecondary education, receive transportation support, and so forth. Some States increased maximum benefit levels. These changes were facilitated by abundant TANF funds and by the dramatic cut in caseload numbers, which has sharply reduced effective work participation rates required for all families. Table 7-33 shows major provisions of TANF Programs, State by State. For other summaries of TANF State Programs, see the State Policy Document Project of the Center for Law and Social Policy and the Center on Budget and Policy Priorities (http:// www.spdg.org), the TANF annual report (U.S. Department, 1999), and the National Governors' Association (1999). FUNDING OF TANF Basic Family Assistance Grants TANF's basic block grant is the State family assistance grant, which entitles the 50 States and the District of Columbia to a total of $16.5 billion annually through fiscal year 2002. The 1996 law preappropriated these funds. Distribution of the funds among States is based on record high Federal payments made in immediately preceding years for Aid to Families with Dependent Children (AFDC), EA, and JOBS. The law entitles States to the largest of required Federal payments to States for these three programs for: --Fiscal years 1992-94, annual average; --Fiscal year 1994, plus 85 percent of the amount by which EA payments for fiscal year 1995 exceeded those for fiscal year 1994 if the State amended its EA plan in fiscal year 1994; or --Fiscal year 1995. Table 7-1 (column 2) shows the basic annual family assistance grant for the 50 States and the District of Columbia. Puerto Rico, Guam, and the Virgin Islands also are eligible to operate TANF and receive a family assistance grant, but they operate under special funding rules and are not shown in the table (Section 12). American Samoa, which never implemented AFDC, although eligible, could receive TANF funds at the old AFDC matching rate of 75 percent under section 1108 of the Social Security Act. However, as of early 2000, it had not taken this option. TABLE 7-1.--FAMILY ASSISTANCE GRANTS AND REQUIRED STATE SPENDING UNDER TANF [In thousands of dollars] ---------------------------------------------------------------------------------------------------------------- Maximum child care spending Minimum spending Family 75 percent 80 percent that can be on needy families State assistance of historic of historic ``double- that cannot be grant State State counted'' toward double counted spending \1\ spending \1\ both the CCDF and for MOEs of both TANF MOE CCDF and TANF ---------------------------------------------------------------------------------------------------------------- Alabama.......................... $93,315 $39,214 $41,828 $6,896 $32,318 Alaska........................... 63,609 48,942 52,205 3,545 45,398 Arizona.......................... 222,420 95,028 101,363 10,033 84,995 Arkansas......................... 56,733 20,839 22,228 1,887 18,952 California....................... 3,733,818 2,732,406 2,914,566 85,593 2,646,813 Colorado......................... 136,057 82,871 88,396 8,986 73,885 Connecticut...................... 266,788 183,421 195,649 18,738 164,683 Delaware......................... 32,291 21,771 23,222 5,179 16,592 District of Columbia............. 92,610 70,449 75,146 4,567 65,882 Florida.......................... 562,340 370,919 395,647 33,416 337,503 Georgia.......................... 330,742 173,369 184,926 22,183 151,186 Hawaii........................... 98,905 72,981 77,847 4,972 68,010 Idaho............................ 31,938 13,679 14,591 1,176 12,503 Illinois......................... 585,057 429,021 457,622 56,874 372,147 Indiana.......................... 206,799 113,525 121,093 15,357 98,168 Iowa............................. 131,525 61,963 66,094 5,079 56,885 Kansas........................... 101,931 61,750 65,866 6,673 55,077 Kentucky......................... 181,288 67,418 71,913 7,275 60,144 Louisiana........................ 163,972 55,415 59,109 5,219 50,196 Maine............................ 78,121 37,778 40,296 1,750 36,028 Maryland......................... 229,098 176,965 188,763 23,301 153,664 Massachusetts.................... 459,371 358,948 382,877 44,973 313,974 Michigan......................... 775,353 468,518 499,753 24,411 444,107 Minnesota........................ 267,985 179,745 191,728 19,690 160,055 Mississippi...................... 86,768 21,724 23,173 1,715 20,009 Missouri......................... 217,052 120,121 128,129 16,549 103,572 Montana.......................... 45,534 15,689 16,735 1,314 14,375 Nebraska......................... 58,029 28,971 30,903 6,499 22,472 Nevada........................... 43,977 25,489 27,188 2,580 22,908 New Hampshire.................... 38,521 32,115 34,256 4,582 27,533 New Jersey....................... 404,035 303,956 324,219 26,374 277,581 New Mexico....................... 126,103 37,450 39,947 2,895 34,555 New York......................... 2,442,931 1,710,795 1,824,848 101,984 1,608,811 North Carolina................... 302,240 154,176 164,454 37,927 116,248 North Dakota..................... 26,400 9,069 9,674 1,017 8,052 Ohio............................. 727,968 390,551 416,588 45,404 345,147 Oklahoma......................... 148,014 61,250 65,334 10,630 50,620 Oregon........................... 167,925 92,255 98,405 11,715 80,540 Pennsylvania..................... 719,499 407,126 434,267 46,629 360,497 Rhode Island..................... 95,022 60,367 64,392 5,321 55,046 South Carolina................... 99,968 35,839 38,229 4,085 31,754 South Dakota..................... 21,894 8,774 9,359 803 7,971 Tennessee........................ 191,524 82,810 88,331 18,976 63,834 Texas............................ 486,257 235,725 251,440 34,681 201,043 Utah............................. 76,829 25,291 26,977 4,475 20,816 Vermont.......................... 47,353 25,653 27,364 2,666 22,987 Virginia......................... 158,285 128,173 136,718 21,329 106,844 Washington....................... 404,332 272,061 290,198 38,708 233,353 West Virginia.................... 110,176 32,701 34,881 2,971 29,730 Wisconsin........................ 318,188 169,229 180,511 16,449 152,779 Wyoming.......................... 21,781 10,665 11,376 1,554 9,112 ------------------------------------------------------------------------------ Total........................ 16,488,667 10,434,961 11,130,625 887,607 9,547,354 ---------------------------------------------------------------------------------------------------------------- \1\ Fiscal year 1994 spending on AFDC, EA, JOBS, and AFDC-related child care. Source: Table prepared by the Congressional Research Service based on information from the U.S. Department of Health and Human Services. State Spending Requirement (MOE) To avoid a loss of TANF funds, States must maintain their own spending on families with children who are needy under State financial standards. The specified level is 75 percent of expenditures made from State funds in fiscal year 1994 for AFDC, EA, JOBS, and AFDC-related child care (80 percent if a State fails to meet work participation minimums). Table 7-1 (columns 3 and 4) shows the 75 and 80 percent maintenance-of- effort (MOE) levels by State. At the 75 percent level, required spending by States totals $10.4 billion; at the 80 percent level, $11.1 billion. Countable toward the MOE requirement are expenditures on cash assistance, child care, education specifically for TANF recipients and not the general population, administrative costs, and any other spending on activities that further the goals of TANF. These expenditures can be made under the State's TANF Program or an SSP not subject to TANF work and time limit rules. However, for spending not authorized under a State's pre-TANF Programs, a new spending test applies; countable toward MOE are only expenditures above the fiscal year 1995 level. To count toward the TANF MOE, the State expenditure cannot be made as a condition of receiving funds from any Federal program such as Medicaid. A special exception to this rule applies to child care expenditures. State spending for child care is countable toward the TANF MOE so long as the funds are not used as the State match for the CCDF. To be eligible for CCDF matching funds, States must first meet an MOE requirement for CCDF. Column 5 of table 7-1 shows that a maximum of $0.9 billion in State child care expenditures can be counted toward the TANF MOE as well as the CCDF MOE. Column 6 shows that a minimum of $9.5 billion in State expenditures on needy families (the difference between columns 3 and 5) cannot be counted toward both the TANF MOE and the CCDF MOE. States that maintain child care spending at the higher of their 1994 or 1995 spending on the replaced programs are entitled also to extra funds at the Medicaid match rate. Supplemental Grants to States with High Population Growth and/or Low AFDC-Related Federal Spending Per Poor Person For fiscal years 1998-2001, the TANF law appropriated a total of $800 million for supplemental grants to States with high population growth and/or low fiscal year 1994 Federal spending per poor person on programs ended by TANF. For fiscal year 1998, the supplemental grant has been computed as 2.5 percent of the amount required to be paid to the State under AFDC, Emergency Assistance to Needy Families (EA), JOBS, and AFDC-related child care in fiscal year 1994. In subsequent years, it is computed as the prior year's supplemental grant plus 2.5 percent of the sum of fiscal year 1994 base expenditures and the prior year's supplemental grant. Automatic qualification The law qualifies certain States automatically for supplemental funds for each year from fiscal year 1998 to fiscal year 2001 on the basis of historical data. These are States that meet at least one of two conditions: (1) fiscal year 1994 Federal expenditures per poor State resident on AFDC, EA, JOBS, and AFDC-related child care (poverty count based on the 1990 census) were below 35 percent of the corresponding national spending per poor person; or (2) the State's population grew more than 10 percent from April 1, 1990 to July 1, 1994. DHHS has determined that 11 States automatically qualify for supplemental funds for each year: Alabama, Alaska, Arizona, Arkansas, Colorado, Idaho, Louisiana, Mississippi, Nevada, Utah, and Texas. Annual qualification Other States may qualify only by meeting each of two conditions: (1) Federal welfare expenditures per poor State resident (poverty count based on the 1990 census) in the current year on programs ended by TANF are below fiscal year 1994 national average comparable expenditures per poor person; and (2) during the most recent year with available data, the State's population grew at a rate above the national average. Further, to qualify for supplemental funds on these grounds, States must have met the qualification criteria in fiscal year 1998. DHHS has determined that six additional States qualified on these grounds in fiscal year 1998: Florida, Georgia, Montana, New Mexico, North Carolina, and Tennessee. If a State does not meet these annual criteria in fiscal years 1999-2001, it will continue to receive its prior year supplemental grant, but that grant will not increase. In fiscal years 2000 and 2001, Montana and New Mexico do not qualify for an increase in supplemental funds because their 1997-98 population growth rate failed to exceed the national population growth rate. Table 7-2 shows annual supplemental grants for fiscal year 1998 and projections of supplemental grants for fiscal years through 2001.\3\ Under current projections, the $800 million appropriation will be sufficient to pay each State's full supplemental grant in fiscal year 2001. However, current law provides no supplemental grant for fiscal year 2002, the last year for which basic TANF Block Grants are funded. As the table shows, more than half of the 17 supplemental grantee States are in the South. Not qualifying are the remaining 34 States. Further, the law makes the territories ineligible. --------------------------------------------------------------------------- \3\ The projections for fiscal year 2001 assume that all States that qualified for an increase in the supplemental grant from fiscal year 1999 to fiscal year 2000 will qualify for an increase in the supplemental grant from fiscal year 2000 to fiscal year 2001. This differs from the projections made by the U.S. Department of Health and Human Services (DHHS) (see Information Memorandum TANF-ACF-IM-99-4), which assumes that only the States that automatically qualify for supplemental grants will receive an increase in fiscal year 2001. --------------------------------------------------------------------------- Welfare-to-Work Grants The basic TANF Block Grant earmarks no funds for any program component. In response to a Presidential budget proposal, the 1997 Balanced Budget Act established welfare-to- work (WTW) grants (Sec. 403(a)(5)) as a component of TANF (for details, see below). TABLE 7-2.--ESTIMATED SUPPLEMENTAL GRANTS TO STATES WITH HIGH POPULATION GROWTH AND/OR RELATIVELY LOW FEDERAL AFDC AND RELATED PROGRAM EXPENDITURES PER POOR PERSON, FISCAL YEARS 1998-2001 [In thousands of dollars] ------------------------------------------------------------------------ State 1998 1999 2000 2001 ------------------------------------------------------------------------ Alabama..................... $2,671 $5,410 $8,216 $11,093 Alaska...................... 1,659 3,359 5,102 6,888 Arizona..................... 5,762 11,667 17,720 23,925 Arkansas.................... 1,497 3,032 4,606 6,218 Colorado.................... 3,268 6,617 10,051 13,570 Florida..................... 14,547 29,457 44,740 60,406 Georgia..................... 8,978 18,181 27,614 37,283 Idaho....................... 842 1,706 2,591 3,498 Louisiana................... 4,100 8,303 12,611 17,027 Mississippi................. 2,176 4,406 6,692 9,036 Montana..................... 1,133 1,133 1,133 1,133 Nevada...................... 899 1,821 2,765 3,734 New Mexico.................. 3,236 6,553 6,553 6,553 North Carolina.............. 8,696 17,609 26,745 36,110 Tennessee................... 5,193 10,516 15,973 21,565 Texas....................... 12,693 25,703 39,039 52,708 Utah........................ 2,096 4,245 6,447 8,704 ------------------------------------------- Total................... 79,447 159,720 238,599 319,450 ------------------------------------------------------------------------ Source: Table prepared by the Congressional Research Service based on data from the U.S. Department of Health and Human Services and the Census Bureau. For fiscal years 1999-2001, estimates assume that States that qualified for annual increases in grants in fiscal year 2000 also qualify for an annual increase in fiscal year 2001. Contingency Fund The contingency fund provides capped matching grants for States that experience high and increasing unemployment rates or increased food stamp caseloads. A total of $1.960 billion is appropriated to the contingency fund for fiscal years 1997- 2001; the 1996 welfare reform law actually provided $2 billion in contingency funds, but the $2 billion was reduced by $40 million in Public Law 105-89. To qualify for contingency funds, a State must meet one of two criteria of ``need'': (1) its seasonally adjusted unemployment rate averaged over the most recent 3-month period must be at least 6.5 percent and at least 10 percent higher than the rate in the corresponding 3-month period in either of the previous 2 years; or (2) its food stamp caseload over the most recent 3-month period must be at least 10 percent higher than the adjusted food stamp caseload was in the corresponding 3-month period in fiscal years 1994 or 1995. For this purpose, fiscal years 1994 and 1995 food stamp caseloads are adjusted by subtracting noncitizens that would have been ineligible for benefits had the Personal Responsibility and Work Opportunity Reconciliation Act's ban on food stamp eligibility for noncitizens been in effect in those years. To qualify for the contingency fund, a State must meet a special high MOE requirement. The required State spending level is higher (100 percent of fiscal year 1994 spending on AFDC, EA, and JOBS) than for the regular TANF MOE, and the categories of countable spending are more restrictive. For the contingency fund MOE, State spending on SSPs are not countable; spending must be on the TANF Program. Further, TANF expenditures on TANF child care are excluded from contingency fund countable spending (and from the historic spending level base). If a State fails to maintain 100 percent of historic State expenditures under its TANF Program during a year in which it receives contingency funds, DHHS must reduce the State's family assistance grant for the next year by the amount of contingency funds. The maximum sum available to a State from the contingency fund is 20 percent of its State family assistance grant, and in each month that it qualifies, a State may receive up to one- twelfth of its maximum contingency grant. The State's full year entitlement is calculated by: (1) multiplying its countable expenditures above the 100 percent MOE level by the Medicaid matching rate and then (2) multiplying the result by the proportion of the year (for example, one-twelfth for 1 month; one-half for 6 months) that the State met the needy State criteria. A State's full year entitlement to contingency funds can be determined only after the close of the fiscal year. It is based on its countable expenditures, including those financed from contingency fund advance payments; the number of months it qualified; and its matching rate during the fiscal year. If a State received more in advances than its full year entitlement, it must remit overpayments to the Treasury. Remittance of overpayments must be made within 1 year after the State has not met the needy State criteria for 3 consecutive months. These remittances are also increased by an adjustment. This adjustment reflects a provision of Public Law 105-89 (the Adoption and Safe Families Act of 1997) that reduced the contingency fund appropriation by $40 million and correspondingly increased required remittances by a maximum $2 million in fiscal year 1998, $9 million in fiscal year 1999, $16 million in fiscal year 2000, and $13 million in fiscal year 2001. Under this provision, each State's remittance is increased by the lesser of its percentage share of total contingency fund entitlements multiplied by that year's increase in the required remittance or its contingency fund entitlement. Loan Fund TANF also provides a $1.7 billion revolving loan fund. States may receive loans of maturities of up to 3 years, which must be repaid with interest. The interest rate for the loans is the current average market yield on outstanding marketable obligations of the Federal Government. A State is ineligible for a loan if it is subject to a penalty for misspending TANF funds. Bonus Funds Nonmarital birth rate reduction The 1996 welfare reform law appropriates $100 million annually for 4 years, fiscal years 1999-2002, for bonuses to a maximum of five States (or outlying areas) that make the largest percentage reduction in the nonmarital birth rate while also reducing abortion rates. Awards are based on the most recent 2-year data available from the National Center for Health Statistics, compared with that for the previous 2-year period. Initial awards were made in 1999 to five jurisdictions (Alabama, California, District of Columbia, Massachusetts, and Michigan), each of which received $20 million for achieving the largest percentage reductions in out-of-wedlock birth rates between 1994-95 and 1996-97. For further information about nonmarital birth rates and the illegitimacy bonus, see Appendix M. High performance bonus The 1996 law appropriated $1 billion for bonuses averaging $200 million for each of 5 years to ``high performing'' States. It defined a high performing State as one whose TANF performance score for the previous year at least equaled a threshold set for that year by the DHHS Secretary. It stipulated that State performance was to be measured by a formula to be developed by the Secretary in consultation with the National Governors' Association and the American Public Welfare Association (since renamed the American Public Human Services Association). The law said the formula was to measure success in achieving ``the goals'' of TANF. DHHS subsequently announced that the high-performance bonus formula for performance years fiscal years 1998-99 would be based on State rankings (absolute and relative) on two work-related measures: rates of job entry and success in the work force (job retention and earnings gain). In late December 1999, DHHS announced that 27 States had been selected to share the first high-performance bonus of $200 million. At the time the Department said that beginning in performance year fiscal year 2001, it planned to add three new performance measures to the bonus formula: ``family formation''--improvement in the percentage of children below 200 percent of poverty living in married couple families, enrollment in Medicaid or the Children's Health Insurance Program (CHIP), and enrollment in food stamps. Winners of the first high-performance bonus, shown in table 7-3, ranked among the top 10 States in at least one of the four categories. Bonuses ranged from $0.5 million in South Dakota for improvement in job entry to $45.5 million in California for both absolute and relative success in the work force. The States that ranked the highest in each category were Indiana (job placement), Minnesota (job retention and earnings), Washington (biggest improvement in job placement), and Florida (biggest improvement in job retention and earnings). TABLE 7-3.--HIGH-PERFORMANCE BONUS AWARDS, FISCAL YEAR 1999 [In thousands of dollars] ---------------------------------------------------------------------------------------------------------------- 1998 performance 1998 performance ------------------------- improvement State Total bonus ------------------------ Job entry Work force Work force success \1\ Job entry success \1\ ---------------------------------------------------------------------------------------------------------------- Arizona.......................................... $2,707.7 .......... $1,981.5 .......... $726.1 California....................................... 45,454.2 .......... 33,264.4 .......... 12,189.8 Connecticut...................................... 2,376.8 .......... 2,376.8 .......... ........... Delaware......................................... 1,614.5 $943.7 ........... $670.8 ........... Florida.......................................... 6,845.7 .......... 5,009.9 .......... 1,835.9 Hawaii........................................... 881.1 .......... 881.1 .......... ........... Illinois......................................... 21,571.9 19,661.9 ........... .......... 1,910.0 Indiana.......................................... 8,792.2 6,949.9 1,842.4 .......... ........... Iowa............................................. 1,171.8 .......... 1,171.8 .......... ........... Louisiana........................................ 3,770.2 .......... ........... 3,770.2 ........... Massachusetts.................................... 10,562.2 .......... ........... 10,562.2 ........... Michigan......................................... 2,531.3 .......... ........... .......... 2,531.3 Minnesota........................................ 9,424.1 .......... 2,387.5 6,161.7 874.9 Nevada........................................... 2,198.8 1,285.2 ........... 913.6 ........... New York......................................... 7,975.4 .......... ........... .......... 7,975.4 North Dakota..................................... 887.2 887.2 ........... .......... ........... Oklahoma......................................... 3,403.2 .......... ........... 3,403.2 ........... Pennsylvania..................................... 24,180.1 24,180.1 ........... .......... ........... Rhode Island..................................... 2,495.0 .......... ........... 2,184.8 310.2 South Carolina................................... 1,217.0 .......... 890.6 .......... 326.4 South Dakota..................................... 503.4 .......... ........... 503.4 ........... Tennessee........................................ 6,436.5 6,436.5 ........... .......... ........... Texas............................................ 16,341.5 16,341.5 ........... .......... ........... Utah............................................. 2,582.0 2,582.0 ........... .......... ........... Washington....................................... 10,616.7 .......... ........... 9,296.7 1,320.0 West Virginia.................................... 2,533.3 .......... ........... 2,533.3 ........... Wyoming.......................................... 926.1 732.0 194.1 .......... ........... -------------------------------------------------------------- Total........................................ 200,000.0 80,000.0 50,000.0 40,000.0 30,000.0 ---------------------------------------------------------------------------------------------------------------- \1\ To determine success in the work force, measures of job retention and earnings gain were weighted, combined, and then reranked. Source: Table prepared by the Congressional Research Service based on information from the U.S. Department of Health and Human Services. TANF FOR INDIANS The 1996 welfare law gave federally recognized Indian tribes (defined to include certain Alaska Native organizations) the option to design and operate their own cash welfare programs for needy children \4\ with funds subtracted from their State's TANF Block Grant. In mid-February 2000, 22 tribal TANF plans were in operation, covering approximately 4,480 families in 12 States, and 22 plans were pending that would cover 78 more tribes and villages and raise the total number of families served by tribal plans to 17,800. The 1996 welfare law also appropriated $7.6 million annually for 6 years, fiscal years 1997-2002, for work and training activities to tribes in 24 States that operated the repealed JOBS Programs (the replacement program is called Native Employment Works (NEW)), authorized direct Federal funding to recognized Indian tribes for operation of Child Support Enforcement Programs, and set aside a share of child care funds for Indian tribes. Further, the 1997 Balanced Budget Act (Public Law 105-33), which established a 2-year program of WTW grants to serve TANF recipients with impediments to work, reserved $30 million of its formula grants for Indian programs. --------------------------------------------------------------------------- \4\ Before enactment of TANF, American Indians or Alaska Natives (Indians, Inuit [Eskimos] or Aleuts) received AFDC on the same terms as other families in their State, with benefits and income eligibility rules set by the State and costs paid by Federal and State funds. --------------------------------------------------------------------------- Tribal TANF Programs have several distinctive features, including: --Work participation rates and time limit rules are set by the Secretary of DHHS with participation of the tribe. The 1996 law exempts from the 60-month TANF benefit time limit any month of aid during which the recipient lived on a reservation (or in an Alaska Native village) of at least 1,000 persons in which at least 50 percent of adults were unemployed; --Tribal plans are for 3 years (rather than 2, as for States), and contain many fewer required elements than State plans; --DHHS has ruled that State funds contributed to an approved tribal plan may be counted toward the TANF MOE level; --The law gives explicit permission for State TANF Programs to use money from a new loan fund for aid to Indian families that have moved out of the area served by a tribal plan; and --Tribal TANF regulations, issued February 18, 2000, and effective June 17, 2000, permit 35 percent of a tribal grant to be used for administrative costs in the first year, 30 percent in the second year, and 25 percent thereafter. State TANF Programs, however, may spend no more than 15 percent of their grants on administration (with the exception of computerization expenses for tracking and monitoring.) Data compiled by the Division of Tribal Services show that only four tribal plans adopted the statutory work participation rate of 35 percent for fiscal year 1999. The others set lower participation rates, ranging from 15 to 30 percent. However, most tribal plans adopted the TANF 60-month lifetime benefit limit (two set a limit of 24 months within an 84-month period, and one, a limit of 24 consecutive months within 60 months). DHHS reports that in fiscal year 1998, more than 4,000 adults in tribal programs entered employment; another 4,000 achieved other program goals, such as earning a high school diploma or general education degree or completing a training program A tribe's TANF grant equals Federal payments made to the State for fiscal year 1994 for AFDC, EA, and JOBS that are attributable to Indians in its service area. A tribe's grant is smaller than the sum spent on AFDC Indian children in fiscal year 1994 because it lacks the State matching share. Although the existence of a tribal program within a State reduces the State's potential TANF caseload, States are not required to help fund the tribal plan. However, some nine States do so for at least some of the tribal plans within their borders (Alaska, Arizona, California, Idaho, Minnesota, Montana, Oregon, Washington, and Wyoming). South Dakota says it provides transition funds and training. In 1999, Congress amended the law to permit tribal TANF Programs, like State programs, to reserve TANF funds for assistance (aid for basic ongoing needs) in any future year (Public Law 106-169). Final regulations for tribal TANF Programs were issued February 18, 2000 (Federal Register, 2000). AFDC/TANF DATA Highlights Since Congress ended the entitlement of eligible families with children to cash aid in August 1996, AFDC/TANF rolls have continued to shrink, and work by families still on the rolls has doubled. To promote work, State TANF Programs employ tough work sanctions, generous work rewards, ``work first'' policies, and welfare avoidance (diversion) payments. Data reported by States indicate that higher average earnings for those remaining on the rolls apparently have more than offset a slight drop in average benefits (chart 7-6), that the percentage of welfare children cared for by a nonrecipient (child-only cases) has increased, but that otherwise the composition of TANF families resembles that of AFDC families (table 7-27), and that the share of welfare adults who are nonwhites apparently has increased (table 7-28). National data are not available about families who have left TANF, but studies indicate that in some States from 50 to 65 percent of persons who leave TANF have jobs then or a short time later (compared with a general work exit rate of almost 50 percent before TANF), that the jobs generally pay wages slightly above the minimum, and that about one-fifth or more of ex-recipients return to the rolls within several months. (See Appendix L for review of TANF research.) Caseloads Historical national trends As table 7-4 shows, enrollment in family welfare, which soared to an all-time peak in fiscal year 1994, has fallen to the lowest level since the early 1970s. Some of the decline in the reported caseload since 1996 represents families who were moved into separate State programs (SSPs) not subject to TANF rules. The proportion of U.S. children enrolled in AFDC/TANF hovered between 11 and 12 percent throughout the 1970s and 1980s and then soared above 14 percent in 1993-94. Since then the share has been cut in half, to an estimated 6.9 percent in September 1999. Chart 7-1 shows that the number of AFDC families began climbing in fiscal year 1990, reached a record peak in spring 1994 and then plunged to 2.5 million in September 1999. More than one-fourth of this decline occurred before passage of TANF. Food stamp enrollment also dropped sharply, by more than 10 million persons, from spring 1994 to October 1999. TABLE 7-4.--HISTORICAL TRENDS IN AFDC/TANF ENROLLMENTS, FISCAL YEARS 1970-99 ---------------------------------------------------------------------------------------------------------------- Average monthly number (in thousands) Total child Percent --------------------------------------- population all Fiscal year (under age children on Families Recipients Children 18) \1\ AFDC/TANF ---------------------------------------------------------------------------------------------------------------- 1970........................................... 1,909 7,415 5,494 69,759 7.9 1971........................................... 2,532 9,556 6,963 69,806 9.9 1972........................................... 2,918 10,632 7,698 69,417 11.1 1973........................................... 3,124 11,038 7,965 68,762 11.6 1974........................................... 3,170 10,845 7,824 67,984 11.5 1975........................................... 3,357 11,094 7,952 67,164 11.8 1976........................................... 3,575 11,386 8,054 66,250 12.2 1977........................................... 3,593 11,130 7,846 65,461 12.0 1978........................................... 3,539 10,672 7,492 64,773 11.6 1979........................................... 3,496 10,318 7,197 64,106 11.2 1980........................................... 3,642 10,597 7,320 63,754 11.5 1981........................................... 3,871 11,160 7,615 63,213 12.0 1982........................................... 3,569 10,431 6,975 62,813 11.1 1983........................................... 3,651 10,659 7,051 62,566 11.3 1984........................................... 3,725 10,866 7,153 62,482 11.4 1985........................................... 3,692 10,813 7,165 62,623 11.4 1986........................................... 3,748 10,997 7,300 62,865 11.6 1987........................................... 3,784 11,065 7,381 63,056 11.7 1988........................................... 3,748 10,920 7,325 63,246 11.6 1989........................................... 3,771 10,934 7,370 63,457 11.6 1990........................................... 3,974 11,460 7,755 63,942 12.1 1991........................................... 4,374 12,592 8,513 65,069 13.1 1992........................................... 4,768 13,625 9,226 66,075 14.0 1993........................................... 4,981 14,143 9,560 66,963 14.3 1994........................................... 5,046 14,226 9,611 67,804 14.2 1995........................................... 4,879 13,659 9,280 68,438 13.6 1996........................................... 4,552 12,644 8,671 69,023 12.6 1997........................................... 3,947 10,954 7,781 69,528 10.5 1998........................................... 3,179 8,770 6,330 70,229 8.9 1999........................................... 2,648 7,203 \2\ 5,114 70,548 7.2 ---------------------------------------------------------------------------------------------------------------- \1\ Census Bureau estimates of the resident child population (under age 18) as of July 1 each year. Figures for 1998 and 1999 are ``middle series'' projections. \2\ Rough estimate, based on ratio of children to total recipients in 1998. Note.--Family, recipient, and child data, fiscal years 1970-96 are from DHHS AFDC baseline book (table 2.1); and for 1997-98 are from DHHS Second Annual Report on indicators of welfare dependence. Source: Table prepared by the Congressional Research Service on the basis of data from the U.S. Department of Health and Human Services. Many factors have helped to shrink the caseload, including the new ``work first'' culture, the improved economy, tougher work sanctions, the existence of a lifetime limit for federally funded benefits, and widespread adoption of diversion practices. Under TANF, not only are recipients departing from welfare at a faster rate, but fewer persons are joining the rolls to replace them. An August 1999 report by the Council of Economic Advisors (pp. 2 and 4) estimates that about one-third of the 1996-98 caseload drop was due to Federal and State welfare policy changes, from 8 to 10 percent to the strong economy, 10 percent to the higher minimum wage, and from 1 to 5 percent to the lower real value of cash welfare benefits. CHART 7-1. AFDC/TANF FAMILIES, 1982-99 Source: Chart prepared by the Congressional Research Service on the basis of the U.S. Department of Health and Human Services data. State caseload trends By fiscal year 1999, the national average Aid to Families with Dependent Children (AFDC)/TANF monthly caseload had plunged 48 percent (almost 2.4 million families) below its all- time peak of 5 million families in fiscal year 1994. Table 7-5 shows that decreases occurred in all jurisdictions except Guam. Rates of decline varied, changing the distribution of welfare families across States. For example, the share of welfare families in California and New York, the two largest AFDC/TANF States, rose from 27 percent in fiscal year 1994 to 34.7 percent in fiscal year 1999. In addition, the percentage of the caseload residing in inner cities has increased (Allen & Kirby, 2000). As noted earlier, the fiscal year 1995 caseload has special significance; required work participation rates are reduced for States whose caseload is below the 1995 base level. The national caseload in fiscal year 1999 was down 45.7 percent from 1995; in 38 of the 54 TANF jurisdictions, the caseload reduction appeared large enough to reduce the required fiscal year 2000 overall work rate from the statutory level of 40 percent to zero. TABLE 7-5.--AFDC/TANF FAMILIES, MONTHLY AVERAGE BY FISCAL YEAR [Families in thousands] -------------------------------------------------------------------------------------------------------------------------------------------------------- Percent change: fiscal year 1999 from State 1994 1995 1996 1997 1998 1999 ------------------------- 1995 1994 -------------------------------------------------------------------------------------------------------------------------------------------------------- Alabama......................................... 50.3 46.0 42.4 34.5 23.3 20.3 -56.0 -59.7 Alaska.......................................... 12.8 12.4 12.3 12.0 10.2 8.5 -31.9 -33.7 Arizona......................................... 72.0 69.6 63.4 54.7 39.6 34.1 -51.0 -52.6 Arkansas........................................ 26.0 24.3 22.7 20.9 13.8 11.9 -50.9 -54.1 California...................................... 909.0 919.5 896.0 815.9 707.0 624.1 -32.1 -31.3 Colorado........................................ 41.6 38.6 35.4 29.9 21.2 14.3 -63.0 -65.7 Connecticut..................................... 59.2 61.0 58.1 55.8 48.1 33.9 -44.4 -42.7 Delaware........................................ 11.5 10.8 10.4 9.8 7.2 6.2 -42.1 -45.5 District of Columbia............................ 27.1 26.8 25.7 24.1 21.1 19.1 -28.8 -29.7 Florida......................................... 247.1 230.8 212.0 170.5 108.0 82.0 -64.5 -66.8 Georgia......................................... 141.5 139.1 130.4 105.9 75.0 62.2 -55.3 -56.0 Guam............................................ 1.9 2.1 2.1 2.3 2.1 2.5 20.7 34.8 Hawaii.......................................... 20.4 21.7 22.0 21.3 16.8 16.0 -26.2 -21.7 Idaho........................................... 8.7 9.1 9.0 6.5 1.9 1.4 -84.8 -84.1 Illinois........................................ 240.3 236.2 224.1 198.9 169.7 122.8 -48.0 -48.9 Indiana......................................... 73.8 65.6 52.9 44.7 40.1 36.7 -44.0 -50.3 Iowa............................................ 39.6 36.5 32.8 28.8 25.2 22.0 -39.8 -44.5 Kansas.......................................... 30.1 28.2 25.1 20.2 14.1 12.8 -54.5 -57.3 Kentucky........................................ 79.8 75.4 71.8 65.3 52.9 42.6 -43.4 -46.6 Louisiana....................................... 86.9 79.8 70.6 56.5 48.2 39.4 -50.7 -54.7 Maine........................................... 22.9 21.7 20.5 18.5 15.7 13.5 -37.9 -41.3 Maryland........................................ 80.1 80.4 74.1 59.2 47.4 34.7 -56.8 -56.6 Massachusetts................................... 111.8 100.9 88.4 78.0 66.5 54.5 -46.0 -51.3 Michigan........................................ 223.9 201.7 178.0 151.6 123.7 95.2 -52.8 -57.5 Minnesota....................................... 63.0 61.3 58.3 53.3 48.3 42.5 -30.8 -32.6 Mississippi..................................... 56.8 52.5 48.0 38.5 23.7 16.6 -68.3 -70.7 Missouri........................................ 92.1 89.3 82.7 71.8 60.0 50.9 -43.0 -44.7 Montana......................................... 11.9 11.5 10.8 8.9 6.4 4.8 -58.0 -59.5 Nebraska........................................ 15.9 14.8 14.2 13.9 13.0 11.3 -23.5 -28.9 Nevada.......................................... 14.2 15.7 14.8 11.9 10.4 8.0 -48.9 -43.3 New Hampshire................................... 11.5 10.8 9.5 8.1 6.9 6.4 -41.0 -44.5 New Jersey...................................... 122.4 118.9 112.0 95.4 80.5 62.2 -47.6 -49.2 New Mexico...................................... 33.6 34.4 33.9 27.0 21.1 25.5 -26.0 -24.2 New York........................................ 455.0 456.9 431.7 384.4 336.9 294.4 -35.6 -35.3 North Carolina.................................. 131.2 125.5 113.1 98.9 78.0 59.3 -52.7 -54.8 North Dakota.................................... 5.9 5.2 4.9 4.2 3.3 3.1 -40.6 -47.3 Ohio............................................ 250.2 228.2 206.7 191.4 151.5 113.8 -50.1 -54.5 Oklahoma........................................ 47.0 44.8 38.8 30.3 24.5 20.1 -55.2 -57.3 Oregon.......................................... 42.1 39.3 33.4 24.1 18.2 16.9 -57.0 -60.0 Pennsylvania.................................... 210.2 204.8 190.3 163.6 127.7 105.7 -48.4 -49.7 Puerto Rico..................................... 58.8 54.8 50.9 47.7 41.9 36.2 -34.0 -38.5 Rhode Island.................................... 22.7 22.2 21.2 19.8 19.3 18.0 -19.0 -20.6 South Carolina.................................. 51.9 49.0 45.8 34.2 25.3 18.4 -62.5 -64.6 South Dakota.................................... 6.9 6.3 6.0 5.1 3.8 3.2 -48.7 -53.4 Tennessee....................................... 110.8 104.0 99.1 70.4 57.4 57.6 -44.6 -48.0 Texas........................................... 283.7 273.0 255.0 209.0 145.3 114.1 -58.2 -59.8 Utah............................................ 17.8 16.6 14.8 12.2 10.7 9.8 -41.1 -44.9 Vermont......................................... 9.9 9.6 9.1 8.3 7.4 6.6 -31.5 -33.1 Virginia........................................ 74.8 72.1 64.9 53.9 43.3 37.0 -48.7 -50.5 Virgin Islands.................................. 1.1 1.3 1.4 1.3 1.1 1.0 -26.6 -12.5 Washington...................................... 103.0 101.9 98.9 93.0 79.4 62.6 -38.6 -39.2 West Virginia................................... 40.7 38.4 36.6 33.6 19.7 11.4 -70.2 -71.9 Wisconsin....................................... 77.2 72.4 60.1 38.9 12.8 19.1 -73.6 -75.2 Wyoming......................................... 5.7 5.2 4.7 2.8 1.3 0.8 -84.4 -85.9 ------------------------------------------------------------------------------------------------------- Total....................................... 5,046.3 4,879.0 4,551.7 3,941.8 3,178.7 2,648.1 -45.7 -47.5 -------------------------------------------------------------------------------------------------------------------------------------------------------- Source: Table prepared by the Congressional Research Service based on data reported by States to the U.S. Department of Health and Human Services. Benefits Average benefits In 20 of 52 jurisdictions with available data (California and Minnesota are missing), average monthly TANF benefits in 1998 rose above 1997 levels, but elsewhere they continued the general downward trend from previous years. As table 7-6 shows, benefits fell short of fiscal year 1994 levels except in Kentucky, Montana, Nebraska, Nevada, New Mexico, South Dakota, Tennessee, Texas, Utah, West Virginia, Wisconsin, and the Virgin Islands. As noted earlier, employment rates of AFDC/ Temporary Assistance for Needy Families (TANF) adults more than tripled from 1994 to 1998, and higher earnings resulted in some decline in average welfare payments paid. TABLE 7-6.--AVERAGE MONTHLY BENEFIT FOR AFDC/TANF FAMILIES, FISCAL YEARS 1994-98 ---------------------------------------------------------------------------------------------------------------- State 1994 1995 1996 1997 1998 ---------------------------------------------------------------------------------------------------------------- Alabama.................................................. $148.48 $146.13 $144.21 $142.10 $139.58 Alaska................................................... 805.26 822.90 769.01 NA 669.00 Arizona.................................................. 299.27 299.57 291.11 290.03 278.76 Arkansas................................................. 177.71 177.65 169.70 170.92 166.68 California............................................... 551.72 558.16 538.51 526.25 NA Colorado................................................. 315.20 313.97 302.36 304.10 300.48 Connecticut.............................................. 563.73 515.32 463.10 465.67 462.35 Delaware................................................. 297.41 296.00 304.35 280.74 270.52 District of Columbia..................................... 393.86 392.48 384.00 350.80 345.68 Florida.................................................. 254.20 255.50 250.42 229.89 228.45 Georgia.................................................. 245.56 244.63 242.62 242.74 236.82 Guam..................................................... 504.77 494.60 548.80 527.29 502.30 Hawaii................................................... 665.54 671.64 668.11 613.17 519.78 Idaho.................................................... 282.16 269.75 265.88 287.74 256.78 Illinois................................................. 314.82 306.12 295.17 289.18 280.74 Indiana.................................................. 257.29 255.46 244.52 233.00 229.34 Iowa..................................................... 359.21 340.97 336.95 326.52 329.62 Kansas................................................... 345.68 335.91 319.59 311.40 296.90 Kentucky................................................. 207.58 202.97 222.90 223.19 219.64 Louisiana................................................ 163.28 159.62 153.10 157.20 159.13 Maine.................................................... 418.28 403.84 393.79 390.97 367.95 Maryland................................................. 315.53 315.76 309.46 303.14 310.60 Massachusetts............................................ 544.42 531.80 523.65 473.84 504.94 Michigan................................................. 429.23 415.58 405.87 396.30 357.37 Minnesota................................................ 477.69 479.75 470.28 477.85 NA Mississippi.............................................. 119.72 123.00 116.95 117.51 101.15 Missouri................................................. 261.37 260.71 257.45 251.67 243.68 Montana.................................................. 343.80 344.00 349.25 348.29 367.84 Nebraska................................................. 319.39 308.88 310.58 320.13 323.14 Nevada................................................... 283.83 284.82 279.38 274.23 288.09 New Hampshire............................................ 467.30 467.82 466.26 459.14 417.12 New Jersey............................................... 361.01 355.41 345.61 332.28 342.72 New Mexico............................................... 325.21 343.13 352.13 342.24 382.99 New York................................................. 495.43 494.04 487.14 478.50 479.85 North Carolina........................................... 229.37 226.97 222.86 218.72 219.56 North Dakota............................................. 355.43 352.73 353.23 355.62 338.29 Ohio..................................................... 308.46 305.18 301.91 291.52 306.25 Oklahoma................................................. 292.14 279.85 258.36 252.62 217.22 Oregon................................................... 394.67 394.49 339.51 401.37 380.99 Pennsylvania............................................. 379.69 379.48 373.71 372.95 364.83 Puerto Rico.............................................. 101.79 100.47 99.69 101.95 98.33 Rhode Island............................................. 495.11 510.40 485.89 490.56 477.20 South Carolina........................................... 175.31 180.34 176.45 162.21 157.60 South Dakota............................................. 293.10 292.58 301.72 285.44 294.23 Tennessee................................................ 168.65 170.71 172.35 163.74 169.91 Texas.................................................... 162.50 157.60 155.95 159.96 164.49 Utah..................................................... 341.60 356.51 347.66 346.16 354.40 Vermont.................................................. 525.63 502.31 450.18 442.75 460.60 Virginia................................................. 259.33 251.29 248.18 247.18 245.74 Virgin Islands........................................... 264.51 268.23 256.91 285.65 334.15 Washington............................................... 492.65 498.13 489.02 476.38 464.08 West Virginia............................................ 236.44 230.16 228.13 225.33 239.80 Wisconsin................................................ 463.01 457.28 432.54 422.37 565.70 Wyoming.................................................. 300.01 299.47 286.91 263.06 218.50 ---------------------------------------------------------------------------------------------------------------- NA--Not available. Source: Table prepared by the Congressional Research Service based on data reported by States to the U.S. Department of Health and Human Services. Maximum benefits Table 7-7 presents maximum benefit levels (amounts paid to those without income) for families of three. The last column shows that between July 1994 and January 2000, the real value of maximum benefits decreased in most States. Most States did not change maximum benefits (with the result that their inflation-adjusted value fell by almost 11 percent). Sixteen States increased benefits, but only seven jurisdictions raised benefits enough to more than offset price inflation: Guam, Kentucky, Mississippi, Montana, New Mexico, West Virginia, and Wisconsin. Table 7-8 shows maximum TANF benefits, by State, for a single-parent family from one to six persons, with no earned income, as of January 1, 2000. Table 7-9 shows maximum combined TANF and food stamp benefits, by State and family size, for single-parent families who have no earnings. Table 7-10 shows AFDC/TANF maximum benefits for three persons in nominal dollars over the long term (1970-2000) for selected years: July 1970, July 1975, July 1980, July 1985, January 1990, January 1995, January 2000, with the last column showing the percent change in real dollars from 1970 to 2000. TABLE 7-7.--MAXIMUM COMBINED AFDC/TANF BENEFITS FOR A FAMILY OF THREE (PARENT WITH TWO CHILDREN), JULY 1994- JANUARY 2000 ---------------------------------------------------------------------------------------------------------------- Percent real change from State July July July January July 1994- 1994 1996 1998 2000 January 2000 ---------------------------------------------------------------------------------------------------------------- Alabama....................................................... $164 $164 $164 $164 -10.7 Alaska........................................................ 923 923 923 923 -10.7 Arizona....................................................... 347 347 347 347 -10.7 Arkansas...................................................... 204 204 204 204 -10.7 California.................................................... 607 596 565 626 -7.9 Colorado...................................................... 356 356 356 357 -10.5 Connecticut................................................... 680 636 636 636 -16.5 Delaware...................................................... 338 338 338 338 -10.7 District of Columbia.......................................... 420 415 379 379 -19.5 Florida....................................................... 303 303 303 303 -10.7 Georgia....................................................... 280 280 280 280 -10.7 Guam.......................................................... 330 673 673 673 82.0 Hawaii: Work exempt............................................... 712 712 712 712 -10.7 Nonexempt................................................. 712 712 570 570 -28.5 Idaho......................................................... 317 317 276 293 -17.5 Illinois...................................................... 377 377 377 377 -10.7 Indiana....................................................... 288 288 288 288 -10.7 Iowa.......................................................... 426 426 426 426 -10.7 Kansas........................................................ 429 429 429 429 -10.7 Kentucky...................................................... 228 262 262 262 2.6 Louisiana..................................................... 190 190 190 190 -10.7 Maine......................................................... 418 418 439 461 -1.6 Maryland...................................................... 373 373 388 417 -0.2 Massachusetts: Work exempt............................................... 579 579 579 579 -10.7 Nonexempt................................................. 579 565 565 565 -12.9 Michigan: Washtenaw County.......................................... 489 489 489 489 -10.7 Wayne County.............................................. 459 459 459 459 -10.7 Minnesota..................................................... 532 532 532 532 -10.7 Mississippi................................................... 120 120 120 170 26.5 Missouri...................................................... 292 292 292 292 -10.7 Montana....................................................... 416 438 461 469 0.6 Nebraska...................................................... 364 364 364 364 -10.7 Nevada........................................................ 348 348 348 348 -10.7 New Hampshire................................................. 550 550 550 575 -6.7 New Jersey.................................................... 424 424 424 424 -10.7 New Mexico.................................................... 381 389 489 439 2.8 New York: New York City............................................. 577 577 577 577 -10.7 Suffolk County............................................ 703 703 703 703 -10.7 North Carolina................................................ 272 272 272 272 -10.7 North Dakota.................................................. 431 431 440 457 -5.4 Ohio.......................................................... 341 341 362 373 -2.4 Oklahoma...................................................... 324 307 292 292 -19.6 Oregon........................................................ 460 460 460 460 -10.7 Pennsylvannia................................................. 421 421 421 421 -10.7 Puerto Rico................................................... 180 180 180 180 -10.7 Rhode Island.................................................. 554 554 554 554 -10.7 South Carolina................................................ 200 200 201 204 -9.1 South Dakota.................................................. 430 430 430 430 -10.7 Tennessee..................................................... 185 185 185 185 -10.7 Texas......................................................... 188 188 188 201 -4.6 Utah.......................................................... 414 416 451 451 -2.8 Vermont....................................................... 650 633 656 708 -2.8 Virgin Islands................................................ 240 240 240 240 -10.7 Virginia...................................................... 354 354 354 354 -10.7 Washington.................................................... 546 546 546 546 -10.7 West Virginia................................................. 253 253 253 328 15.7 Wisconsin: Community service......................................... 517 517 673 673 16.2 W2 transition............................................. 517 517 628 628 8.4 Wyoming....................................................... 360 360 340 340 -15.7 Median State.............................................. 381 415 421 421 -10.5 ---------------------------------------------------------------------------------------------------------------- Note.--The Consumer Price Index for All Urban Consumers inflation adjustment factor for converting July 1994 dollars to January 2000 dollars is 1.1203. Source: Table prepared by the Congressional Research Service on the basis of data from the U.S. Department of Health and Human Services. TABLE 7-8.--MAXIMUM MONTHLY TANF BENEFIT FOR FAMILIES OF ONE TO SIX PERSONS, JANUARY 1, 2000 \1\ ---------------------------------------------------------------------------------------------------------------- Family size State ----------------------------------------------- 1 \2\ 2 3 4 5 6 ---------------------------------------------------------------------------------------------------------------- Alabama......................................................... $111 $137 $164 $194 $225 $252 Alaska.......................................................... 514 821 923 1025 1127 1229 Arizona......................................................... 204 275 347 418 489 561 Arkansas........................................................ 81 162 204 247 286 331 California: Region 1.................................................... 310 505 626 746 849 953 Region 2.................................................... 294 481 596 710 808 907 Colorado........................................................ 214 281 357 432 513 591 Connecticut..................................................... 402 513 636 741 835 935 Delaware........................................................ 201 270 338 407 475 544 District of Columbia............................................ 239 298 379 463 533 627 Florida......................................................... 180 241 303 364 426 487 Georgia......................................................... 155 235 280 330 378 410 Guam............................................................ 420 537 673 776 874 985 Hawaii: Work exempt................................................. 418 565 712 859 1006 1153 Nonexempt................................................... 335 452 570 687 805 922 Idaho........................................................... 293 293 293 293 293 293 Illinois........................................................ 212 278 377 414 485 545 Indiana......................................................... 139 229 288 346 405 463 Iowa............................................................ 183 361 426 495 548 610 Kansas.......................................................... 267 352 429 497 558 619 Kentucky........................................................ 186 225 262 328 383 432 Louisiana....................................................... 72 138 190 234 277 316 Maine........................................................... 219 345 461 581 698 815 Maryland........................................................ 185 328 417 503 583 641 Massachusetts: Work exempt................................................. 392 486 579 668 760 854 Nonexempt................................................... 383 474 565 651 741 832 Michigan: Washtenaw County............................................ 305 401 489 593 689 822 Wayne County................................................ 276 371 459 563 659 792 Minnesota....................................................... 250 437 532 621 697 773 Mississippi..................................................... 110 146 170 194 218 242 Missouri........................................................ 136 234 292 342 388 431 Montana......................................................... 278 374 469 564 659 754 Nebraska........................................................ 222 293 364 435 506 577 Nevada.......................................................... 229 289 348 407 466 525 New Hampshire................................................... 439 506 575 638 698 779 New Jersey...................................................... 162 322 424 488 552 616 New Mexico...................................................... 281 360 439 519 598 677 New York: New York City............................................... 352 468 577 687 800 884 Suffolk County.............................................. 446 576 703 824 949 1038 North Carolina.................................................. 181 236 272 297 324 349 North Dakota.................................................... 271 363 457 549 642 735 Ohio............................................................ 223 305 373 461 539 600 Oklahoma........................................................ 180 225 292 361 422 483 Oregon.......................................................... 310 395 460 565 660 755 Pennsylvannia................................................... 215 330 421 514 607 687 Puerto Rico..................................................... 132 156 180 204 228 252 Rhode Island.................................................... 327 449 554 634 714 794 South Carolina.................................................. 121 162 204 245 286 328 South Dakota.................................................... 304 380 430 478 528 578 Tennessee....................................................... 95 142 185 226 264 305 Texas........................................................... 84 174 201 241 268 308 Utah............................................................ 261 362 451 528 601 663 Vermont......................................................... 503 604 708 792 881 940 Virginia........................................................ 220 294 354 410 488 534 Virgin Islands.................................................. 120 180 240 300 360 420 Washington...................................................... 349 440 546 642 740 841 West Virginia................................................... 224 276 328 387 435 488 Wisconsin: Community service........................................... 0 673 673 673 673 673 W2 transition............................................... 0 628 628 628 628 628 Wyoming......................................................... 195 320 340 340 360 360 ---------------------------------------------------------------------------------------------------------------- \1\ Calculations assume a single-parent family with no earned income and use normal rounding rules. \2\ A family size of one represents a pregnant woman or a child-only case. Colorado and Texas have separate payment schedules for the two groups; the table shows amounts for pregnant women. Maximum child-only benefits are smaller; $117 in Colorado and $68 in Texas. Source: Table prepared by the Congressional Research Service on the basis of a telephone survey of States. TABLE 7-9.--MAXIMUM COMBINED TANF AND FOOD STAMP \1\ BENEFIT FOR FAMILIES OF ONE TO SIX PERSONS, JANUARY 1, 2000 \2\ ---------------------------------------------------------------------------------------------------------------- Family size State ----------------------------------------------- 1 2 3 4 5 6 ---------------------------------------------------------------------------------------------------------------- Alabama......................................................... $238 $370 $490 $602 $703 $823 Alaska.......................................................... 558 904 1,101 1,285 1,456 1,652 Arizona......................................................... 310 466 618 758 888 1,039 Arkansas........................................................ 208 387 518 639 746 878 California: Region 1.................................................... 384 627 813 988 1,140 1,314 Region 2.................................................... 373 610 792 963 1,111 1,282 Colorado........................................................ 316 471 625 768 905 1,060 Connecticut..................................................... 448 633 820 984 1,130 1,301 Delaware........................................................ 307 463 611 751 878 1,028 District of Columbia............................................ 334 482 640 790 919 1,086 Florida......................................................... 293 442 587 721 844 988 Georgia......................................................... 275 438 571 697 810 934 Guam............................................................ 498 717 942 1,131 1,303 1,510 Hawaii: Work exempt................................................. 531 800 1,061 1,305 1,533 1,794 Nonexempt................................................... 473 721 962 1,185 1,392 1,632 Idaho........................................................... 372 479 580 671 751 852 Illinois........................................................ 315 468 639 756 885 1,028 Indiana......................................................... 264 434 576 708 829 971 Iowa............................................................ 295 526 673 812 929 1,074 Kansas.......................................................... 354 520 675 814 936 1,080 Kentucky........................................................ 297 431 558 695 814 949 Louisiana....................................................... 199 370 508 630 740 868 Maine........................................................... 320 515 697 872 1,034 1,217 Maryland........................................................ 296 503 667 818 954 1,095 Massachusetts: Work exempt................................................. 441 614 780 933 1,078 1,245 Nonexempt................................................... 435 606 770 921 1,064 1,229 Michigan: Washtenaw County............................................ 380 554 717 881 1,028 1,222 Wayne County................................................ 360 533 696 860 1,007 1,201 Minnesota....................................................... 358 629 789 934 1,061 1,207 Mississippi..................................................... 237 376 494 602 698 816 Missouri........................................................ 262 438 579 705 817 948 Montana......................................................... 361 536 703 861 1,007 1,175 Nebraska........................................................ 322 479 630 770 900 1,051 Nevada.......................................................... 327 476 618 751 872 1,014 New Hampshire................................................... 474 628 777 912 1,034 1,192 New Jersey...................................................... 280 499 672 807 932 1,078 New Mexico...................................................... 363 526 682 829 964 1,121 New York: New York City............................................... 413 601 779 947 1,106 1,266 Suffolk County.............................................. 479 677 867 1,043 1,210 1,373 North Carolina.................................................. 293 439 565 674 773 891 North Dakota.................................................... 356 528 695 850 995 1,161 Ohio............................................................ 323 487 636 788 923 1,067 Oklahoma........................................................ 293 431 579 718 841 985 Oregon.......................................................... 384 550 697 861 1,008 1,175 Pennsylvania.................................................... 317 505 669 826 971 1,128 Puerto Rico \3\................................................. 206 296 379 453 522 601 Rhode Island.................................................... 396 588 763 910 1,046 1,203 South Carolina.................................................. 248 387 518 637 746 876 South Dakota.................................................... 380 540 676 800 915 1,051 Tennessee....................................................... 222 373 504 624 731 860 Texas........................................................... 211 396 515 634 733 862 Utah............................................................ 349 527 690 835 966 1,111 Vermont......................................................... 519 697 870 1,020 1,162 1,305 Virginia........................................................ 321 480 623 753 887 1,021 Virgin Islands.................................................. 308 511 703 878 1,038 1,230 Washington...................................................... 411 582 757 915 1,064 1,235 West Virginia................................................... 324 467 604 737 850 988 Wisconsin: Community service........................................... (\4\) 745 846 937 1,017 1,118 W2 transition............................................... (\4\) 713 814 905 985 1,086 Wyoming......................................................... 303 498 613 704 798 899 ---------------------------------------------------------------------------------------------------------------- \1\ Food stamp calculations assume that the family does not receive an excess shelter deduction. In very low benefit States, combined benefits shown reflect the maximum food stamp allotment for the family size, but in some States the excess shelter deduction would increase food stamps (by up to $83 monthly--more in Alaska and Hawaii). \2\ Calculations assume a single-parent family with no earned income and use normal rounding rules. \3\ Puerto Rico does not have a standard Food Stamp Program, but it operates a program of nutritional cash assistance under a block grant. The table shows TANF benefits plus amounts from the Nutritional Cash Assistance Program. \4\ Wisconsin has no one-person families in its regular W-2 (TANF) Program. Pregnant women without children are ineligible and ``child-only'' recipients have been moved into special programs. Source: Table prepared by the Congressional Research Service. Benefits for minimum wage workers Table 7-11 shows annual earnings net of payroll taxes, plus TANF, the earned income credit (EIC), and food stamps (January 2000 levels) for a minimum wage worker with two children who works half time all year round. (This and subsequent tables should not be taken to imply that all workers actually receive these benefits.) Table 7-12 shows the same thing for a full-time, year-round minimum wage worker. Table 7-10 shows maximum Aid to Families with Dependent Children (AFDC)/TANF benefits for a three-person family by State for selected years from July 1970 to January 2000. Over the three decades, the real value of cash payments declined in all States. In 25 jurisdictions the decline was 50 percent or greater. However, part of this loss was offset by the intervening development of the Food Stamp Program, which in 1970 did not operate in more than half the Nation and lacked standard rules. In many States maximum combined TANF food stamp benefits for three persons (table 7-9) now exceed the inflation-adjusted value of AFDC alone on July 1970. The most dramatic impact of food stamps has occurred in Mississippi and Puerto Rico, where combined benefits for a family of three with no earnings ($494 and $379, respectively), now are double the real value of AFDC benefits back in July 1970 ($242 and $186). TABLE 7-10.--AFDC/TANF MAXIMUM BENEFIT FOR A THREE-PERSON FAMILY BY STATE, SELECTED YEARS 1970-2000 ---------------------------------------------------------------------------------------------------------------- Year --------------------------------------------------------------------------- Percent State July July July July January January January change in 1970 \1\ 1975 1980 1985 1990 \2\ 1995 \2\ 2000 \2\ real value, 1970-2000 \3\ ---------------------------------------------------------------------------------------------------------------- Alabama............................. $65 $108 $118 $118 $118 $164 $164 -42 Alaska.............................. 328 350 457 719 846 923 923 -35 Arizona............................. 138 163 202 233 293 347 347 -42 Arkansas............................ 89 125 161 192 204 204 204 -47 California.......................... 186 293 473 587 694 607 \4\ 626 -22 Colorado............................ 193 217 290 346 356 356 356 -57 Connecticut......................... 283 346 475 569 649 680 636 -48 Delaware............................ 160 221 266 287 333 338 338 -51 District of Columbia................ 195 243 286 327 409 420 379 -55 Florida............................. 114 144 195 240 294 303 303 -39 Georgia............................. 107 123 164 223 273 280 280 -40 Guam................................ NA NA 261 265 330 330 673 NA Hawaii.............................. 226 428 468 468 602 712 \5\ 712 -27 Idaho............................... 211 300 323 304 317 317 293 -68 Illinois............................ 232 261 288 341 367 377 377 -62 Indiana............................. 120 200 255 256 288 288 288 -45 Iowa................................ 201 294 360 360 410 426 426 -51 Kansas.............................. 222 321 345 391 409 429 429 -55 Kentucky............................ 147 185 188 197 228 228 262 -59 Louisiana........................... 88 128 152 190 190 190 190 -50 Maine............................... 135 176 280 370 453 418 461 -21 Maryland............................ 162 200 270 329 396 373 417 -40 Massachusetts....................... 268 259 379 432 539 579 \5\ 579 -50 Michigan: Washtenaw County................ NA NA NA 447 546 489 489 NA Wayne County.................... 219 333 425 417 516 459 459 -52 Minnesota........................... 256 330 417 528 532 532 532 -52 Mississippi......................... 56 48 96 96 120 120 170 -30 Missouri............................ 104 120 248 274 289 292 292 -35 Montana............................. 202 201 259 354 359 416 469 -46 Nebraska............................ 171 210 310 350 364 364 364 -51 Nevada.............................. 121 195 262 285 330 348 348 -34 New Hampshire....................... 262 308 346 389 506 550 575 -49 New Jersey.......................... 302 310 360 404 424 424 424 -68 New Mexico.......................... 149 169 220 258 264 381 439 -32 New York: New York City................... 279 332 394 474 577 577 577 -52 Suffolk County.................. NA NA NA 579 703 703 703 NA North Carolina...................... 145 183 192 246 272 272 272 -57 North Dakota........................ 213 283 334 371 386 431 457 -50 Ohio................................ 161 204 263 290 334 341 373 -46 Oklahoma............................ 152 217 282 282 325 324 292 -56 Oregon.............................. 184 337 282 386 432 460 460 -42 Pennsylvania........................ 265 296 332 364 421 421 421 -63 Puerto Rico......................... 43 43 44 90 90 180 180 -3 Rhode Island........................ 229 278 340 409 543 554 554 -44 South Carolina...................... 85 96 129 187 206 200 204 -45 South Dakota........................ 264 289 321 329 377 430 430 -62 Tennessee........................... 112 115 122 153 184 185 185 -62 Texas............................... 148 116 116 167 184 188 201 -69 Utah................................ 175 252 360 376 387 426 451 -40 Vermont............................. 267 322 492 583 662 650 708 -39 Virgin Islands...................... NA 131 209 171 240 240 240 NA Virginia............................ 225 268 310 354 354 354 354 -64 Washington.......................... 258 315 458 476 501 546 546 -51 West Virginia....................... 114 206 206 249 249 253 328 -33 Wisconsin........................... 184 342 444 533 517 517 \6\ 628 -21 Wyoming............................. 213 235 315 360 360 360 340 -63 --------------------------------------------------------------------------- Median State \7\................ 184 235 288 332 364 377 421 -47 ---------------------------------------------------------------------------------------------------------------- \1\ Data on three-person families were not published or reported before 1975. Thus, the 1970 data were derived by reducing the reported four-person maximum benefit amount by the proportional difference between three- and four-person AFDC maximum benefit as shown in the July 1975 reports of the (then) Department of Health, Education and Welfare. \2\ Congressional Research Service survey data. \3\ Real percentage change. The Consumer Price Index for All Urban Consumers inflation adjustment factor used for converting July 1970 dollars to January 2000 dollars was 4.3256. \4\ Benefits for region 1. \5\ Benefits for persons exempt from work. \6\ Benefits for persons in W-2 transitions (work preparation activities). \7\ Among the 50 States and the District of Columbia. NA--Not available. Source: Table compiled by the Congressional Research Service on the basis of data from the U.S. Department of Health and Human Services and the Congressional Research Service. TABLE 7-11.--ANNUALIZED EARNINGS AND INCOME FROM SELECTED MAJOR BENEFIT PROGRAMS FOR SINGLE PARENT WITH TWO CHILDREN WORKING HALF TIME AT MINIMUM WAGE IN MONTH 13 OF EMPLOYMENT, JANUARY 1, 2000 -------------------------------------------------------------------------------------------------------------------------------------------------------- As a percent of 1999 poverty threshold Net Food Combined ---------------------------------------------- earnings EIC TANF stamps total Net Food Combined earnings EIC TANF stamps total -------------------------------------------------------------------------------------------------------------------------------------------------------- Alabama.................................................. $4,946 $2,142 0 $3,216 $10,305 36.8 16.0 0.0 24.0 76.8 Alaska................................................... 5,426 2,350 $11,076 0 18,853 40.4 17.5 82.5 0.0 140.5 Arizona.................................................. 4,946 2,142 1,171 2,856 11,115 36.8 16.0 8.7 21.3 82.8 Arkansas................................................. 4,946 2,142 1,224 4,020 12,333 36.8 16.0 9.1 29.9 91.9 California: Region 1............................................. 5,523 2,392 5,872 1,296 15,083 41.1 17.8 43.7 9.7 112.4 Region 2............................................. 5,523 2,392 5,512 1,404 14,831 41.1 17.8 41.1 10.5 110.5 Colorado \1\............................................. 4,946 2,142 658 3,012 10,758 36.8 16.0 4.9 22.4 80.1 Connecticut.............................................. 5,907 2,558 7,632 2,208 18,305 44.0 19.1 56.9 16.4 136.4 Delaware................................................. 5,426 2,350 2,804 2,244 12,825 40.4 17.5 20.9 16.7 95.5 District of Columbia..................................... 5,907 2,558 1,950 2,376 12,791 44.0 19.1 14.5 17.7 95.3 Florida.................................................. 4,946 2,142 2,158 2,568 11,815 36.8 16.0 16.1 19.1 88.0 Georgia.................................................. 4,946 2,142 812 2,964 10,865 36.8 16.0 6.0 22.1 80.9 Guam \2\................................................. 4,946 2,142 3,800 3,228 14,117 36.8 16.0 28.3 24.0 105.2 Hawaii: Work exempt.......................................... 5,042 2,184 7,284 3,252 17,763 37.6 16.3 54.3 24.2 132.3 Nonexempt............................................ 5,042 2,184 5,580 3,768 16,575 37.6 16.3 41.6 28.1 123.5 Idaho.................................................... 4,946 2,142 1,370 2,796 11,255 36.8 16.0 10.2 20.8 83.8 Illinois................................................. 4,946 2,142 2,739 2,388 12,215 36.8 16.0 20.4 17.8 91.0 Indiana.................................................. 4,946 2,142 0 3,216 10,305 36.8 16.0 0.0 24.0 76.8 Iowa \1\................................................. 4,946 2,142 2,970 2,316 12,374 36.8 16.0 22.1 17.3 92.2 Kansas \1\............................................... 4,946 2,142 2,582 2,436 12,107 36.8 16.0 19.2 18.1 90.2 Kentucky................................................. 4,946 2,142 0 3,216 10,305 36.8 16.0 0.0 24.0 76.8 Louisiana................................................ 4,946 2,142 0 3,216 10,305 36.8 16.0 0.0 24.0 76.8 Maine.................................................... 4,946 2,142 5,122 1,680 13,891 36.8 16.0 38.2 12.5 103.5 Maryland \1\............................................. 4,946 2,142 1,523 2,760 11,371 36.8 16.0 11.3 20.6 84.7 Massachusetts: \1\ Work exempt.......................................... 5,763 2,496 1,788 2,460 12,507 42.9 18.6 13.3 18.3 93.2 Nonexempt............................................ 5,763 2,496 1,620 2,508 12,387 42.9 18.6 12.1 18.7 92.3 Michigan: Washtenaw County..................................... 4,946 2,142 3,503 2,160 12,752 36.8 16.0 26.1 16.1 95.0 Wayne County......................................... 4,946 2,142 3,143 2,268 12,500 36.8 16.0 23.4 16.9 93.1 Minnesota \1\............................................ 4,946 2,142 4,011 3,084 14,184 36.8 16.0 29.9 23.0 105.7 Mississippi.............................................. 4,946 2,142 0 3,216 10,305 36.8 16.0 0.0 24.0 76.8 Missouri................................................. 4,946 2,142 0 3,216 10,305 36.8 16.0 0.0 24.0 76.8 Montana.................................................. 4,946 2,142 3,411 2,184 12,684 36.8 16.0 25.4 16.3 94.5 Nebraska................................................. 4,946 2,142 0 3,216 10,305 36.8 16.0 0.0 24.0 76.8 Nevada................................................... 4,946 2,142 0 3,216 10,305 36.8 16.0 0.0 24.0 76.8 New Hampshire............................................ 4,946 2,142 4,222 1,944 13,255 36.8 16.0 31.5 14.5 98.7 New Jersey............................................... 4,946 2,142 2,410 2,484 11,983 36.8 16.0 18.0 18.5 89.3 New Mexico............................................... 4,979 2,157 3,493 2,160 12,789 37.1 16.1 26.0 16.1 95.3 New York: \1\ New York City........................................ 4,946 2,142 4,615 1,824 13,528 36.8 16.0 34.4 13.6 100.8 Suffolk County....................................... 4,946 2,142 6,127 1,368 14,584 36.8 16.0 45.6 10.2 108.6 North Carolina........................................... 4,946 2,142 0 3,216 10,305 36.8 16.0 0.0 24.0 76.8 North Dakota............................................. 4,946 2,142 1,574 2,736 11,399 36.8 16.0 11.7 20.4 84.9 Ohio..................................................... 4,946 2,142 3,298 2,220 12,607 36.8 16.0 24.6 16.5 93.9 Oklahoma................................................. 4,946 2,142 1,546 2,748 11,383 36.8 16.0 11.5 20.5 84.8 Oregon \1\............................................... 6,243 2,704 2,140 2,232 13,319 46.5 20.1 15.9 16.6 99.2 Pennsylvania............................................. 4,946 2,142 2,374 2,496 11,959 36.8 16.0 17.7 18.6 89.1 Rhode Island \1\......................................... 5,426 2,350 4,730 1,668 14,175 40.4 17.5 35.2 12.4 105.6 South Carolina........................................... 4,946 2,142 979 2,916 10,984 36.8 16.0 7.3 21.7 81.8 South Dakota............................................. 4,946 2,142 1,739 2,688 11,516 36.8 16.0 13.0 20.0 85.8 Tennessee................................................ 4,946 2,142 2,220 2,544 11,853 36.8 16.0 16.5 19.0 88.3 Texas.................................................... 4,946 2,142 0 3,216 10,305 36.8 16.0 0.0 24.0 76.8 Utah..................................................... 4,946 2,142 3,334 2,208 12,631 36.8 16.0 24.8 16.4 94.1 Vermont \1\.............................................. 5,523 2,392 3,596 1,980 13,491 41.1 17.8 26.8 14.8 100.5 Virginia................................................. 4,946 2,142 4,248 1,932 13,269 36.8 16.0 31.6 14.4 98.9 Virgin Islands \2\....................................... 4,946 2,142 0 5,136 12,225 36.8 16.0 0.0 38.3 91.1 Washington............................................... 6,243 2,704 3,172 1,920 14,039 46.5 20.1 23.6 14.3 104.6 West Virginia............................................ 4,946 2,142 1,794 2,676 11,558 36.8 16.0 13.4 19.9 86.1 Wisconsin: \1\ Community service.................................... 4,946 2,142 2,760 2,388 12,237 36.8 16.0 20.6 17.8 91.2 W2 transition........................................ NA NA NA NA NA NA NA NA NA NA Wyoming.................................................. 4,946 2,142 1,124 2,868 11,081 36.8 16.0 8.4 21.4 82.5 -------------------------------------------------------------------------------------------------------------------------------------------------------- \1\ These States have their own earned income credits (generally calculated as a percentage of the Federal EIC) but they are not shown in this table. \2\ Guam and the Virgin Islands have territorial tax systems that mirror the Internal Revenue Code, including the earned income credit (EIC). However, revenues foregone and refunds paid under their EICs affect their own territorial treasuries, not the U.S. Treasury. NA--Not applicable. (Persons with jobs are not eligible for the Wisconsin program of transitional aid.) Note.--Puerto Rico is omitted from this table. It is not covered by the Federal income tax and has no EIC. A half-time minimum wage worker in Puerto Rico would be ineligible for Temporary Assistance for Needy Families (TANF). Source: Table prepared by the Congressional Research Service based on State and Federal minimum wage laws, EIC law, food stamp law, and the CRS January 2000 Survey of State TANF benefit levels and program rules. TABLE 7-12.--EARNINGS AND INCOME FROM SELECTED MAJOR BENEFIT PROGRAMS FOR SINGLE PARENT WITH TWO CHILDREN WORKING FULL TIME AT MINIMUM WAGE, WORKING IN MONTH 13, ANNUALIZED, JANUARY 1, 2000 -------------------------------------------------------------------------------------------------------------------------------------------------------- As a percent of poverty threshold Net Food Combined ---------------------------------------------- earnings EIC TANF stamps total Net Food Combined earnings EIC TANF stamps total -------------------------------------------------------------------------------------------------------------------------------------------------------- Alabama.................................................. $9,893 $3,888 0 $1,920 $15,701 73.7 29.0 0.0 14.3 117.0 Alaska................................................... 10,853 3,888 $7,440 0 22,181 80.9 29.0 55.4 0.0 165.2 Arizona.................................................. 9,893 3,888 0 1,920 15,701 73.7 29.0 0.0 14.3 117.0 Arkansas................................................. 9,893 3,888 0 1,920 15,701 73.7 29.0 0.0 14.3 117.0 California: Region 1............................................. 11,045 3,888 2,882 756 18,571 82.3 29.0 21.5 5.6 138.4 Region 2............................................. 11,045 3,888 2,522 864 18,319 82.3 29.0 18.8 6.4 136.5 Colorado \1\............................................. 9,893 3,888 0 1,920 15,701 73.7 29.0 0.0 14.3 117.0 Connecticut.............................................. 11,813 3,867 7,632 2,208 25,520 88.0 28.8 56.9 16.4 190.1 Delaware................................................. 10,853 3,888 0 1,680 16,421 80.9 29.0 0.0 12.5 122.3 District of Columbia..................................... 11,813 3,867 0 1,428 17,108 88.0 28.8 0.0 10.6 127.5 Florida.................................................. 9,893 3,888 0 1,920 15,701 73.7 29.0 0.0 14.3 117.0 Georgia.................................................. 9,893 3,888 0 1,920 15,701 73.7 29.0 0.0 14.3 117.0 Guam \2\................................................. 9,893 3,888 0 3,072 16,853 73.7 29.0 0.0 22.9 125.5 Hawaii: Work exempt.......................................... 10,085 3,888 4,489 2,784 21,246 75.1 29.0 33.4 20.7 158.3 Nonexempt............................................ 10,085 3,888 2,785 3,300 20,058 75.1 29.0 20.7 24.6 149.4 Idaho.................................................... 9,893 3,888 0 1,920 15,701 73.7 29.0 0.0 14.3 117.0 Illinois................................................. 9,893 3,888 953 1,644 16,378 73.7 29.0 7.1 12.2 122.0 Indiana.................................................. 9,893 3,888 0 1,920 15,701 73.7 29.0 0.0 14.3 117.0 Iowa \1\................................................. 9,893 3,888 827 1,680 16,288 73.7 29.0 6.2 12.5 121.3 Kansas \1\............................................... 9,893 3,888 0 1,920 15,701 73.7 29.0 0.0 14.3 117.0 Kentucky................................................. 9,893 3,888 0 1,920 15,701 73.7 29.0 0.0 14.3 117.0 Louisiana................................................ 9,893 3,888 0 1,920 15,701 73.7 29.0 0.0 14.3 117.0 Maine.................................................... 9,893 3,888 2,444 1,188 17,413 73.7 29.0 18.2 8.9 129.7 Maryland \1\............................................. 9,893 3,888 0 1,920 15,701 73.7 29.0 0.0 14.3 117.0 Massachusetts: \1\ Work exempt.......................................... 11,525 3,888 0 1,500 16,913 85.9 29.0 0.0 11.2 126.0 Nonexempt............................................ 11,525 3,888 0 1,500 16,913 85.9 29.0 0.0 11.2 126.0 Michigan: Washtenaw County..................................... 9,893 3,888 0 1,920 15,701 73.7 29.0 0.0 14.3 117.0 Wayne County......................................... 9,893 3,888 0 1,920 15,701 73.7 29.0 0.0 14.3 117.0 Minnesota \1\............................................ 9,893 3,888 691 3,084 17,555 73.7 29.0 5.1 23.8 130.8 Mississippi.............................................. 9,893 3,888 0 1,920 15,701 73.7 29.0 0.0 14.3 117.0 Missouri................................................. 9,893 3,888 0 1,920 15,701 73.7 29.0 0.0 14.3 117.0 Montana.................................................. 9,893 3,888 0 1,920 15,701 73.7 29.0 0.0 14.3 117.0 Nebraska................................................. 9,893 3,888 0 1,920 15,701 73.7 29.0 0.0 14.3 117.0 Nevada................................................... 9,893 3,888 0 1,920 15,701 73.7 29.0 0.0 14.3 117.0 New Hampshire............................................ 9,893 3,888 1,544 1,464 16,789 73.7 29.0 11.5 10.9 125.1 New Jersey............................................... 9,893 3,888 0 1,920 15,701 73.7 29.0 0.0 14.3 117.0 New Mexico............................................... 9,896 3,888 0 1,920 15,704 73.7 29.0 0.0 14.3 117.0 New York: \1\ New York City........................................ 9,893 3,888 1,723 1,404 16,907 73.7 29.0 12.8 10.5 126.0 Suffolk County....................................... 9,893 3,888 3,235 960 17,975 73.7 29.0 24.1 7.2 133.9 North Carolina........................................... 9,893 3,888 0 1,920 15,701 73.7 29.0 0.0 14.3 117.0 North Dakota............................................. 9,893 3,888 0 1,920 15,701 73.7 29.0 0.0 14.3 117.0 Ohio..................................................... 9,893 3,888 620 1,740 16,141 73.7 29.0 4.6 13.0 120.2 Oklahoma................................................. 9,893 3,888 0 1,920 15,701 73.7 29.0 0.0 14.3 117.0 Oregon \1\............................................... 12,486 3,713 0 1,248 17,447 93.0 27.7 0.0 9.3 130.0 Pennsylvania............................................. 9,893 3,888 0 1,920 15,701 73.7 29.0 0.0 14.3 117.0 Rhode Island \1\......................................... 10,853 3,888 1,792 1,140 17,673 80.9 29.0 13.4 8.5 131.7 South Carolina........................................... 9,893 3,888 0 1,920 15,701 73.7 29.0 0.0 14.3 117.0 South Dakota............................................. 9,893 3,888 0 1,920 15,701 73.7 29.0 0.0 14.3 117.0 Tennessee................................................ 9,893 3,888 676 1,728 16,185 73.7 29.0 5.0 12.9 120.6 Texas.................................................... 9,893 3,888 0 1,920 15,701 73.7 29.0 0.0 14.3 117.0 Utah..................................................... 9,893 3,888 656 1,728 16,165 73.7 29.0 4.9 12.9 120.4 Vermont \1\.............................................. 11,045 3,888 0 1,632 16,565 82.3 29.0 0.0 12.2 123.4 Virginia................................................. 9,893 3,888 4,248 648 18,677 73.7 29.0 31.6 4.8 139.1 Virgin Islands \2\....................................... 9,893 3,888 0 3,840 17,621 73.7 29.0 0.0 28.6 131.3 Washington............................................... 12,486 3,713 0 1,248 17,447 93.0 27.7 0.0 9.3 130.0 West Virginia............................................ 9,893 3,888 0 1,920 15,701 73.7 29.0 0.0 14.3 117.0 Wisconsin: \1\ Community service \3\................................ 9,893 3,888 0 1,920 15,701 73.7 29.0 0.0 14.3 117.0 W2 transition........................................ NA NA NA NA NA NA NA NA NA NA Wyoming.................................................. 9,893 3,888 0 1,920 15,701 73.7 29.0 0.0 14.3 117.0 -------------------------------------------------------------------------------------------------------------------------------------------------------- \1\ These States have their own earned income credits (generally calculated as a percentage of the Federal EIC) but they are not shown in this table. \2\ Guam and the Virgin Islands have territorial tax systems that mirror the Internal Revenue Code, including the EIC. However, revenues foregone and refunds paid under their EICs affect their own territorial treasuries, not the U.S. Treasury. \3\ This entry applies to a person who has moved from community service to a full-time unsubsidized job (and thus is no longer eligible for a community service payment). NA--Not applicable. (Persons with jobs are not eligible for the Wisconsin program of transitional aid.) Note.--Puerto Rico is omitted from this table. It is not covered by the Federal income tax and has no EIC. A full-time minimum wage worker in Puerto Rico would be ineligible for TANF. Source: Table prepared by the Congressional Research Service based on State and Federal minimum wage laws, EIC law, food stamp law, and the CRS January 2000 Survey of State TANF benefit levels and program rules. Break-Even Levels The earnings levels at which Temporary Assistance for Needy Families (TANF) eligibility ends (TANF break-even points) depend on a State's payment standard, its treatment of earnings, and duration on a job. Table 7-13 presents break-even points for a family of three for the first 13 months in a job. Two States ignore all earnings for a period of time (Alabama, for the first 4 months of employment and New Jersey for 1 month). Connecticut ignores all earnings so long as they are below the Federal poverty level (and the family has not reached the State's 21-month benefit cutoff). Some States retain old AFDC policy and count a higher proportion of earnings against the benefit after 4 months on a job, and still more after 1 year of work (Georgia is an example). Uses of TANF Funds Through fiscal year 1999, States spent $33.5 billion out of $46.8 billion in cumulative TANF awards for fiscal years 1997, 1998 and 1999 (table 7-14). They also transferred $6.4 billion to the Child Care and Development Fund (CCDF) and the Social Services Block Grant, and obligated $4.7 billion. This left an unobligated balance of $2.2 billion. Nationally, expenditures represented 72 percent of total awards; transfers, 14 percent; unliquidated obligations (that is, obligated balances), 10 percent, and unobligated balances, 5 percent. The pattern of fund use varied widely among States: 10 States spent less than 60 percent of their TANF funds (Colorado, Florida, Idaho, Indiana, New Jersey, Ohio, Oklahoma, West Virginia, Wisconsin, and Wyoming); 3 States spent more than 90 percent (Delaware, Maine, and Nebraska); 4 States made no transfers of TANF funds (Nebraska, New Hampshire, North Dakota, and Oregon); and 4 States transferred more than 20 percent of funds (Indiana, Massachusetts, Michigan, and Wyoming). Expenditures Trends Total expenditures for TANF and predecessor programs peaked at $30.1 billion in fiscal year 1995 and declined to $21.5 billion in fiscal year 1998, then rose slightly (table 7-15). At the same time the share of total expenditures paid with Federal funds has declined, from 54.3 percent in 1990 and 53.7 percent in the peak spending year of 1995 to 52.1 percent in 1999. Through fiscal year 1996, data in the table represent Aid to Families with Dependent Children (AFDC), Emergency Assistance to Needy Families (EA), and JOBS. Data for the transition year of fiscal year 1997 combine expenditures for AFDC, EA, and JOBS with expenditures for TANF. Fiscal year 1998 expenditures are for TANF. State TANF expenditures represent spending counted toward the State maintenance of effort (MOE), including State spending on separate State programs (SSPs), but exclude child care spending that can be double counted toward both the TANF MOE and the Child Care and Development Block Grant (CCDBG) MOE. TABLE 7-13.--TANF BREAK-EVEN POINTS--MONTHLY EARNINGS THAT END ELIGIBILITY, SINGLE-PARENT FAMILY WITH TWO CHILDREN, JANUARY 1, 2000 -------------------------------------------------------------------------------------------------------------------------------------------------------- Month of employment State ----------------------------------------------------------------------------------------------------------- 1 2 3 4 5 6 7 8 9 10 11 12 13 -------------------------------------------------------------------------------------------------------------------------------------------------------- Alabama.................................... (\1\) (\1\) (\1\) (\1\) $193 $193 $193 $193 $193 $193 $193 $193 $193 Alaska...................................... $1,998 $1,998 $1,998 $1,998 1,998 1,998 1,998 1,998 1,998 1,998 1,998 1,998 1,793 Arizona..................................... 572 572 572 572 572 572 572 572 572 572 572 572 572 Arkansas.................................... 697 697 697 697 697 697 697 697 697 697 697 697 697 California: Region 1................................ 1,458 1,458 1,458 1,458 1,458 1,458 1,458 1,458 1,458 1,458 1,458 1,458 1,458 Region 2................................ 1,398 1,398 1,398 1,398 1,398 1,398 1,398 1,398 1,398 1,398 1,398 1,398 1,398 Colorado.................................... 734 734 734 734 530 530 530 530 530 530 530 530 500 Connecticut................................. 1,157 1,157 1,157 1,157 1,157 1,157 1,157 1,157 1,157 1,157 1,157 1,157 1,157 Delaware.................................... 1,391 1,391 1,391 1,391 968 968 968 968 968 968 968 968 938 District of Columbia........................ 839 839 839 839 839 839 839 839 839 839 839 839 839 Florida..................................... 787 787 787 787 787 787 787 787 787 787 787 787 787 Georgia..................................... 741 741 741 741 535 535 535 535 535 535 535 535 505 Guam........................................ 1,115 1,115 1,115 1,115 784 784 784 784 784 784 784 784 754 Hawaii: Work exempt............................. 1,622 1,622 1,622 1,622 1,622 1,622 1,622 1,622 1,622 1,622 1,622 1,622 1,622 Nonexempt............................... 1,344 1,344 1,344 1,344 1,344 1,344 1,344 1,344 1,344 1,344 1,344 1,344 1,344 Idaho....................................... 621 621 621 621 621 621 621 621 621 621 621 621 621 Illinois.................................... 1,131 1,131 1,131 1,131 1,131 1,131 1,131 1,131 1,131 1,131 1,131 1,131 1,131 Indiana..................................... 537 537 537 537 399 399 399 399 399 399 399 399 369 Iowa........................................ 1,041 1,041 1,041 1,041 1,041 1,041 1,041 1,041 1,041 1,041 1,041 1,041 1,041 Kansas...................................... 789 789 789 789 789 789 789 789 789 789 789 789 789 Kentucky.................................... 973 973 408 408 408 408 283 283 283 283 283 283 283 Louisiana................................... 1,081 1,081 1,081 1,081 1,081 1,081 301 301 301 301 301 301 301 Maine....................................... 1,023 1,023 1,023 1,023 1,023 1,023 1,023 1,023 1,023 1,023 1,023 1,023 1,023 Maryland.................................... 627 627 627 627 627 627 627 627 627 627 627 627 627 Massachusetts: Work exempt............................. 660 660 660 660 660 660 660 660 660 660 660 660 660 Nonexempt............................... 646 646 646 646 646 646 646 646 646 646 646 646 646 Michigan: Washtenaw County........................ 799 799 799 799 799 799 799 799 799 799 799 799 799 Wayne County............................ 762 762 762 762 762 762 762 762 762 762 762 762 762 Minnesota \2\............................... 986 986 986 986 986 986 986 986 986 986 986 986 986 Mississippi................................. 680 680 680 680 680 680 442 442 442 442 442 442 442 Missouri.................................... 1,116 1,116 1,116 1,116 1,116 1,116 1,116 1,116 1,116 1,116 1,116 1,116 373 Montana..................................... 813 813 813 813 813 813 813 813 813 813 813 813 813 Nebraska.................................... 443 443 443 443 443 443 443 443 443 443 443 443 443 Nevada...................................... 1,532 1,532 1,532 677 677 677 677 677 677 677 677 677 429 New Hampshire............................... 1,131 1,131 1,131 1,131 1,131 1,131 1,131 1,131 1,131 1,131 1,131 1,131 1,131 New Jersey.................................. (\1\) 847 847 847 847 847 847 847 847 847 847 847 847 New Mexico \3\.............................. 928 928 928 928 928 928 928 928 928 928 928 928 928 New York: New York City........................... 1,067 1,067 1,067 1,067 1,067 1,067 1,067 1,067 1,067 1,067 1,067 1,067 1,067 Suffolk County.......................... 1,301 1,301 1,301 1,301 1,301 1,301 1,301 1,301 1,301 1,301 1,301 1,301 1,301 North Carolina.............................. 558 558 558 558 383 383 383 383 383 383 383 383 353 North Dakota................................ 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 893 893 695 695 625 Ohio........................................ 977 977 977 977 977 977 977 977 977 977 977 977 977 Oklahoma.................................... 685 685 685 685 685 685 685 685 685 685 685 685 685 Oregon...................................... 616 616 616 616 616 616 616 616 616 616 616 616 616 Pennsylvania................................ 823 823 823 823 823 823 823 823 823 823 823 823 823 Puerto Rico................................. 360 360 360 360 300 300 300 300 300 300 300 300 300 Rhode Island................................ 1,259 1,259 1,259 1,259 1,259 1,259 1,259 1,259 1,259 1,259 1,259 1,259 1,259 South Carolina.............................. 1,069 1,069 1,069 1,069 650 650 650 650 650 650 650 650 650 South Dakota................................ 616 616 616 616 616 616 616 616 616 616 616 616 616 Tennessee................................... 940 940 940 940 940 940 940 940 940 940 940 940 940 Texas....................................... 407 407 407 407 312 312 312 312 312 312 312 312 282 Utah........................................ 983 983 983 983 983 983 983 983 983 983 983 983 983 Vermont..................................... 1,167 1,167 1,167 1,167 819 819 819 819 819 819 819 819 789 Virginia.................................... 1,157 1,157 1,157 1,157 1,157 1,157 1,157 1,157 1,157 1,157 1,157 1,157 1,157 Virgin Islands.............................. 465 465 465 465 351 351 351 351 351 351 351 351 321 Washington.................................. 1,073 1,073 1,073 1,073 1,073 1,073 1,073 1,073 1,073 1,073 1,073 1,073 1,073 West Virginia............................... 818 818 818 818 818 818 818 818 818 818 818 818 818 Wisconsin: Community service....................... 1,330 1,330 1,330 1,330 1,330 1,330 1,330 1,330 1,330 1,330 1,330 1,330 1,330 W2 transition........................... NA NA NA NA NA NA NA NA NA NA NA NA NA Wyoming..................................... 531 531 531 531 531 531 531 531 531 531 531 531 531 -------------------------------------------------------------------------------------------------------------------------------------------------------- \1\ During these months all earnings are disregarded, and the State has no gross income limit. \2\ TANF break-even points in Minnesota share the earnings level at which the cash portion of the full standard is reduced to zero. The food stamp portion is not reduced (i.e., full food stamp benefits are paid) until earnings have reduced the cash portion to zero. \3\ A recipient in New Mexico could earn as much as $1,264 without losing benefits. This could occur because New Mexico's excess hours disregard does not count income from the hours in excess of 29 hours per week. NA--Not applicable. (Persons with jobs are not eligible for the Wisconsin program of transitional assistance.) Source: Table prepared by the Congressional Research Service based on the CRS January 1, 2000 Survey of State TANF benefit levels and program rules. TABLE 7-14.--STATE USE OF CUMULATIVE TANF GRANTS FOR FISCAL YEARS 1997, 1998, AND 1999 [In millions of dollars] ---------------------------------------------------------------------------------------------------------------- Total Unexpended balance State grant Transfers Available TANF ----------------------------------- awards for TANF expenditures Obligated Unobligated Total ---------------------------------------------------------------------------------------------------------------- Alabama..................... $297.2 $82.5 $214.7 $178.6 $4.8 $31.3 $36.1 Alaska...................... 148.8 40.8 108.0 101.0 0.0 7.0 7.0 Arizona..................... 679.4 107.5 571.9 480.6 91.3 0.0 91.3 Arkansas.................... 137.9 4.1 133.8 86.7 47.1 0.0 47.1 California.................. 10,683.3 590.3 10,093.0 8,472.4 1,620.6 0.0 1,620.6 Colorado.................... 323.3 59.8 263.5 186.4 77.1 0.0 77.1 Connecticut................. 800.4 53.9 746.5 705.7 0.0 40.7 40.7 Delaware.................... 84.5 4.2 80.3 77.3 2.9 0.0 2.9 District of Columbia........ 250.2 38.8 211.4 161.3 32.8 17.3 50.1 Florida..................... 1,731.0 320.1 1,410.9 1,018.3 392.6 0.0 392.6 Georgia..................... 949.5 119.2 830.3 694.4 15.3 120.6 136.0 Hawaii...................... 225.7 22.3 203.4 198.0 1.4 4.0 5.4 Idaho....................... 78.0 13.2 64.8 31.7 16.9 16.2 33.1 Illinois.................... 1,358.9 234.0 1,124.9 1,144.0 0.0 0.0 0.0 Indiana..................... 620.4 186.1 434.3 259.8 174.5 0.0 174.5 Iowa........................ 365.0 40.0 325.0 298.3 5.7 21.0 26.7 Kansas...................... 305.8 43.6 262.2 262.2 0.0 0.0 0.0 Kentucky.................... 531.8 119.4 412.4 412.4 0.0 0.0 0.0 Louisiana................... 473.4 102.1 371.3 259.0 0.0 112.2 112.2 Maine....................... 228.7 23.1 205.7 205.7 0.0 0.0 0.0 Maryland.................... 648.6 137.5 511.1 426.0 50.9 34.2 85.2 Massachusetts............... 1,398.1 415.4 982.7 913.6 0.0 69.1 69.1 Michigan.................... 2,346.1 501.3 1,844.7 1,698.6 0.0 146.1 146.1 Minnesota................... 638.9 111.0 527.9 401.3 67.3 59.3 126.6 Mississippi................. 266.9 50.0 216.9 123.2 20.5 73.2 93.7 Missouri.................... 621.9 86.8 535.1 508.3 15.3 11.4 26.8 Montana..................... 124.6 21.8 102.8 80.4 0.0 22.4 22.4 Nebraska.................... 165.4 0.0 165.4 156.2 0.0 9.2 9.2 Nevada...................... 126.3 0.4 125.9 108.4 17.5 0.0 17.5 New Hampshire............... 115.6 0.0 115.6 105.0 4.6 6.0 10.6 New Jersey.................. 1,110.3 333.1 777.2 524.1 253.1 0.0 253.1 New Mexico.................. 322.5 27.0 295.5 238.7 0.0 56.9 56.9 New York.................... 6,868.2 958.0 5,910.2 4,882.4 343.6 684.1 1,027.7 North Carolina.............. 851.1 101.2 749.9 648.2 98.3 3.4 101.7 North Dakota................ 63.9 0.0 63.9 53.3 3.1 7.5 10.6 Ohio........................ 2,183.9 218.4 1,965.5 1,231.6 583.9 150.0 733.9 Oklahoma.................... 443.5 133.0 310.4 249.0 0.0 61.4 61.4 Oregon...................... 501.4 0.0 501.4 477.6 23.8 0.0 23.8 Pennsylvania................ 1,886.2 180.0 1,706.2 1,554.1 123.3 28.9 152.1 Rhode Island................ 237.4 15.8 221.6 221.6 0.0 0.0 0.0 South Carolina.............. 293.8 38.5 255.3 223.2 32.1 0.0 32.1 South Dakota................ 60.7 7.7 53.0 39.0 2.2 11.9 14.0 Tennessee................... 590.3 83.8 506.5 401.9 25.3 79.2 104.5 Texas....................... 1,464.2 253.2 1,211.1 1,035.5 175.6 0.0 175.6 Utah........................ 236.8 11.8 225.1 207.3 0.0 17.8 17.8 Vermont..................... 142.1 31.3 110.7 107.8 0.0 3.0 3.0 Virginia.................... 434.2 100.5 333.7 318.0 14.2 1.5 15.7 Washington.................. 1,096.9 150.0 947.0 748.6 68.1 130.2 198.4 West Virginia............... 302.5 45.6 256.9 112.1 0.0 144.8 144.8 Wisconsin................... 953.2 184.4 768.8 447.9 290.1 30.7 320.9 Wyoming..................... 60.5 18.0 42.4 7.3 0.0 35.1 35.1 ---------------------------------------------------------------------------------- Total................... 46,829.3 6,420.6 40,408.7 33,484.2 4,695.9 2,247.7 6,943.5 ================================================================================== Percent of total........ ......... 14 86 72 10 5 15 ---------------------------------------------------------------------------------------------------------------- Source: Table prepared by the Congressional Research Service based on data from the U.S. Department of Health and Human Services. TABLE 7-15.--TOTAL, FEDERAL, AND STATE EXPENDITURES FOR TANF AND PREDECESSOR PROGRAMS (AFDC, EA, AND JOBS), FISCAL YEARS 1990-99 [In millions of dollars] ---------------------------------------------------------------------------------------------------------------- Fiscal year Total Federal State ---------------------------------------------------------------------------------------------------------------- Actual (current) dollars: 1990....................................................... $22,018 $11,953 $10,066 1991....................................................... 24,133 13,169 10,964 1992....................................................... 26,606 14,567 12,039 1993....................................................... 27,037 14,790 12,247 1994....................................................... 28,854 15,686 13,168 1995....................................................... 30,091 16,173 13,918 1996....................................................... 28,193 15,067 13,126 1997....................................................... 23,179 12,494 10,686 1998....................................................... 21,513 11,286 10,227 1999....................................................... 21,728 11,323 10,405 Percent change: 1995-99 (change from peak expenditures)........ -27.8 -30.0 -25.2 Constant (1999) dollars: 1990....................................................... 26,773 14,534 12,239 1991....................................................... 28,244 15,412 12,832 1992....................................................... 30,341 16,612 13,729 1993....................................................... 30,116 16,474 13,642 1994....................................................... 31,459 17,102 14,357 1995....................................................... 32,111 17,259 14,852 1996....................................................... 29,497 15,764 13,733 1997....................................................... 23,792 12,824 10,968 1998....................................................... 21,784 11,429 10,356 1999....................................................... 21,728 11,323 10,405 Percent change: 1995-99 (change from peak expenditures)........ -32.3 -34.4 -29.9 ---------------------------------------------------------------------------------------------------------------- Note.--State TANF expenditures exclude child care expenditures that can be ``double counted'' toward both the Child Care and Development Fund and TANF maintenance-of-effort requirement. Source: Table prepared by the Congressional Research Service based on data from the U.S. Department of Health and Human Services. Chart 7-2 shows the national trends in expenditures, from 1995 to 1999. Fiscal year 1995 and 1996 expenditures are Federal and State expenditures made under AFDC, EA, and JOBS. Fiscal year 1997 are transition year expenditures, combining TANF and pre-TANF expenditures. State expenditures under TANF exclude child care that could be credited toward the MOE requirements of both TANF and the CCDF. Expenditures by State Table 7-16 shows TANF and comparable pre-TANF (AFDC, EA and JOBS) expenditures, Federal and State, by State, for fiscal years 1995 and 1999. The Federal share of expenditures, which was a minimum of 50 percent under AFDC, has dropped CHART 7-2. FEDERAL AND STATE EXPENDITURES FOR TANF AND PREDECESSOR PROGRAMS, FISCAL YEARS 1990-99 Note._State expenditures include those made under the State TANF Program and State SSP expenditures but exclude State expenditures that can be double counted toward both the TANF and Child Care and Development Fund maintenance-of-effort requirements. Source: Chart prepared by the Congressional Research Service based on data from the U.S. Department of Health and Human Services. below that level in a number of States, including New York. Nationally Federal expenditures in fiscal year 1999 declined by $4.9 billion (a 30 percent reduction) while State expenditures fell by $3.5 billion (a 25 percent reduction) from their peak levels of fiscal year 1995. TANF law gives States unlimited time in which to spend funds for assistance (benefits to meet a family's ongoing basic needs, plus supportive services for unemployed families), but requires that funds used for nonassistance must be obligated by the end of the fiscal year for which they are awarded and spent by the end of the next year. As shown in table 7-17, $3.3 billion of total TANF expenditures made in fiscal year 1999 came from funds awarded for fiscal years 1997 and 1998. The table also shows that 16.7 percent of fiscal year 1999 TANF awards were transferred by States (6.2 percent to the Social Services Block Grant and 10.6 percent to the CCDF). Twenty States transferred 20 percent or more of their 1999 TANF awards (Alabama, Alaska, Florida, Illinois, Iowa, Kentucky, Louisiana, Massachusetts, Michigan, Minnesota, Missouri, New Jersey, North Carolina, Oklahoma, Tennessee, Vermont, Virginia, Washington, Wisconsin, and Wyoming). TABLE 7-16.--FEDERAL AND STATE EXPENDITURES IN AFDC/TANF AND RELATED PROGRAMS, BY STATE, \1\ FISCAL YEARS 1995 AND 1999 [In millions of dollars] -------------------------------------------------------------------------------------------------------------------------------------------------------- 1995 1999 Change in expenditures ------------------------------------------------------------------------------------------------------- State Federal Federal Federal State share Federal State share Federal State (percent) (percent) -------------------------------------------------------------------------------------------------------------------------------------------------------- Alabama......................................... $84.6 $46.1 64.7 $51.7 $32.3 61.5 -$32.9 -$13.8 Alaska......................................... 60.7 60.0 50.3 38.2 47.2 44.7 -22.6 -12.8 Arizona........................................ 214.2 119.7 64.1 142.2 87.5 61.9 -72.0 -32.2 Arkansas....................................... 48.0 23.3 67.3 45.4 24.3 65.1 -2.5 1.1 California..................................... 3,708.2 3,701.1 50.0 3,345.5 2,821.0 54.3 -362.7 -880.0 Colorado....................................... 131.2 118.1 52.6 70.1 80.4 46.6 -61.1 -37.7 Connecticut.................................... 277.2 273.8 50.3 202.0 164.7 55.1 -75.3 -109.1 Delaware....................................... 35.4 34.4 50.7 32.7 21.5 60.4 -2.6 -12.9 District of Columbia........................... 83.9 81.6 50.7 51.2 72.5 41.4 -32.7 -9.0 Florida........................................ 549.0 446.6 55.1 112.9 337.6 25.1 -436.1 -109.0 Georgia........................................ 317.0 208.4 60.3 235.1 152.6 60.6 -82.0 -55.9 Hawaii......................................... 101.3 99.0 50.6 86.9 81.0 51.8 -14.3 -18.0 Idaho.......................................... 33.0 19.1 63.3 12.2 13.3 48.0 -20.7 -5.8 Illinois....................................... 595.4 580.1 50.7 409.5 373.2 52.3 -185.9 -206.9 Indiana........................................ 168.6 113.0 59.9 66.7 105.7 38.7 -101.9 -7.3 Iowa........................................... 126.7 85.0 59.8 113.3 56.9 66.6 -13.5 -28.1 Kansas......................................... 91.8 68.9 57.1 107.5 61.7 63.5 15.7 -7.3 Kentucky....................................... 156.9 81.1 65.9 126.3 76.5 62.3 -30.6 -4.6 Louisiana...................................... 140.1 76.4 64.7 69.2 53.9 56.2 -70.9 -22.5 Maine.......................................... 74.1 45.9 61.7 68.0 38.8 63.6 -6.1 -7.1 Maryland....................................... 235.4 230.4 50.5 151.3 153.7 49.6 -84.0 -76.7 Massachusetts.................................. 411.2 401.8 50.6 270.5 316.1 46.1 -140.8 -85.7 Michigan....................................... 713.0 558.0 56.1 562.9 446.9 55.7 -150.1 -111.1 Minnesota...................................... 253.6 217.3 53.8 177.0 180.6 49.5 -76.6 -36.7 Mississippi.................................... 82.3 29.8 73.5 21.1 21.5 49.6 -61.2 -8.3 Missouri....................................... 210.4 151.6 58.1 188.4 111.6 62.8 -22.0 -40.1 Montana........................................ 45.5 22.5 66.9 24.9 14.4 63.3 -20.7 -8.1 Nebraska....................................... 59.3 46.6 56.0 85.6 24.0 78.1 26.3 -22.5 Nevada......................................... 44.7 40.0 52.8 37.5 25.0 60.1 -7.2 -15.0 New Hampshire.................................. 38.0 37.7 50.2 27.9 27.5 50.4 -10.0 -10.2 New Jersey..................................... 397.5 387.4 50.6 149.4 273.8 35.3 -248.1 -113.6 New Mexico..................................... 130.4 53.5 70.9 89.8 37.1 70.8 -40.6 -16.5 New York....................................... 2,532.0 2,499.8 50.3 1,533.6 2,016.7 43.2 -998.3 -483.1 North Carolina................................. 320.3 213.9 60.0 222.8 133.4 62.6 -97.5 -80.5 North Dakota................................... 26.1 16.6 61.2 23.9 8.1 74.8 -2.2 -8.5 Ohio........................................... 629.8 434.8 59.2 242.4 368.4 39.7 -387.4 -66.4 Oklahoma....................................... 134.6 69.5 65.9 85.3 54.7 60.9 -49.2 -14.8 Oregon......................................... 164.1 113.6 59.1 194.7 79.9 70.9 30.6 -33.7 Pennsylvania................................... 798.9 702.5 53.2 603.7 387.6 60.9 -195.2 -314.8 Rhode Island................................... 92.9 76.6 54.8 94.9 64.1 59.7 2.0 -12.5 South Carolina................................. 97.1 48.8 66.5 70.9 31.8 69.0 -26.2 -17.0 South Dakota................................... 20.5 11.4 64.2 12.4 8.3 59.8 -8.1 -3.1 Tennessee...................................... 183.6 112.7 62.0 120.5 88.3 57.7 -63.2 -24.3 Texas.......................................... 474.4 318.6 59.8 339.2 216.8 61.0 -135.3 -101.9 Utah........................................... 71.5 35.5 66.8 54.6 20.8 72.4 -16.8 -14.6 Vermont........................................ 46.2 31.3 59.6 37.6 24.7 60.4 -8.5 -6.6 Virginia....................................... 143.8 140.9 50.5 129.9 106.8 54.9 -13.9 -34.1 Washington..................................... 397.8 364.8 52.2 212.3 257.6 45.2 -185.4 -107.2 West Virginia.................................. 96.6 38.0 71.8 14.6 40.6 26.4 -82.0 2.7 Wisconsin...................................... 306.0 217.8 58.4 153.4 152.4 50.2 -152.7 -65.4 Wyoming........................................ 18.1 12.7 58.9 3.4 9.3 26.9 -14.7 -3.3 ------------------------------------------------------------------------------------------------------- Total...................................... 16,173.2 13,917.9 53.7 11,323.2 10,405.2 52.1 -4,850.0 -3,512.7 -------------------------------------------------------------------------------------------------------------------------------------------------------- \1\ Excludes State TANF MOE child care expenditures that can also be counted toward the Child Care and Development Fund MOE. Note.--Funds included in the columns for 1999 reflect actual State expenditures, not the annual amount of Federal TANF funding allocated for each State. Excludes State TANF maintenance-of-effort child care expenditures that can also be counted toward the Child Care and Development Fund maintenance-of- effort requirement. Source: Table prepared by the Congressional Research Service based on data from the U.S. Department of Health and Human Services. TABLE 7-17.--TANF GRANTS, TRANSFERS AND EXPENDITURES, FISCAL YEAR 1999 [In millions of dollars] -------------------------------------------------------------------------------------------------------------------------------------------------------- Transfers Fiscal year 1999 expenditures ------------------------------------------------------------------------------ Spending State Fiscal year Transfer to Spending from fiscal Total 1999 grant Transfer to Social Total from fiscal year 1997 expenditures CCDF Services transfers year 1999 and 1998 in fiscal Block Grant funds funds year 1999 -------------------------------------------------------------------------------------------------------------------------------------------------------- Alabama.................................................... $118.7 $23.7 $11.9 $35.6 $47.0 $4.6 $51.7 Alaska..................................................... 64.5 13.8 5.6 19.4 38.2 0.0 38.2 Arizona.................................................... 230.6 0.0 23.0 23.0 132.1 10.0 142.2 Arkansas................................................... 59.8 0.0 4.1 4.1 16.1 29.3 45.4 California................................................. 3,751.1 307.3 0.0 307.3 1,831.2 1,514.3 3,345.5 Colorado................................................... 142.7 0.0 20.3 20.3 45.3 24.9 70.1 Connecticut................................................ 266.8 0.0 24.1 24.1 202.0 0.0 202.0 Delaware................................................... 32.3 0.1 0.0 0.1 29.5 3.3 32.7 District of Columbia....................................... 92.6 18.5 9.3 27.8 32.1 19.2 51.2 Florida.................................................... 591.8 117.6 59.2 176.8 22.4 90.5 112.9 Georgia.................................................... 348.9 15.8 34.9 50.7 174.8 60.2 235.1 Hawaii..................................................... 98.9 5.6 1.0 6.6 86.9 0.0 86.9 Idaho...................................................... 33.1 6.6 3.3 9.9 0.0 12.2 12.2 Illinois................................................... 585.1 117.0 58.5 175.5 409.5 0.0 409.5 Indiana.................................................... 206.8 56.0 6.0 62.0 16.7 50.1 66.7 Iowa....................................................... 131.5 14.7 12.8 27.6 77.2 36.0 113.3 Kansas..................................................... 101.9 6.1 10.2 16.3 85.6 21.9 107.5 Kentucky................................................... 181.3 36.2 18.1 54.4 126.9 -0.6 126.3 Louisiana.................................................. 172.3 51.7 0.0 51.7 41.6 27.6 69.2 Maine...................................................... 78.1 7.6 2.5 10.1 68.0 0.0 68.0 Maryland................................................... 229.1 0.0 22.9 22.9 126.7 24.6 151.3 Massachusetts.............................................. 479.4 91.9 47.9 139.8 270.5 0.0 270.5 Michigan................................................... 795.4 96.1 79.5 175.6 473.6 89.3 562.9 Minnesota.................................................. 267.4 45.0 26.7 71.7 69.1 107.9 177.0 Mississippi................................................ 91.2 8.7 8.7 17.4 20.3 0.8 21.1 Missouri................................................... 217.1 43.4 21.7 65.1 125.2 63.2 188.4 Montana.................................................... 45.5 5.5 0.0 5.5 23.5 1.4 24.9 Nebraska................................................... 58.0 0.0 0.0 0.0 48.9 36.7 85.6 Nevada..................................................... 45.8 0.0 0.4 0.4 28.6 8.9 37.5 New Hampshire.............................................. 38.5 0.0 0.0 0.0 27.9 0.0 27.9 New Jersey................................................. 404.0 80.8 40.4 121.2 78.5 70.9 149.4 New Mexico................................................. 132.7 13.7 0.0 13.7 65.5 24.3 89.8 New York................................................... 2,442.9 5.0 244.0 249.0 1,314.8 218.9 1,533.6 North Carolina............................................. 319.8 80.3 7.7 88.0 130.2 92.6 222.8 North Dakota............................................... 26.4 0.0 0.0 0.0 18.1 5.8 23.9 Ohio....................................................... 728.0 0.0 72.8 72.8 206.0 36.4 242.4 Oklahoma................................................... 147.6 29.5 14.8 44.3 42.0 43.4 85.3 Oregon..................................................... 166.8 0.0 0.0 0.0 143.0 51.7 194.7 Pennsylvania............................................... 719.5 127.0 0.0 127.0 460.8 142.9 603.7 Rhode Island............................................... 95.0 13.6 2.2 15.8 79.2 15.7 94.9 South Carolina............................................. 100.0 3.5 10.0 13.5 64.4 6.5 70.9 South Dakota............................................... 21.3 0.0 2.1 2.1 12.4 0.0 12.4 Tennessee.................................................. 202.0 51.8 0.0 51.8 114.9 5.6 120.5 Texas...................................................... 512.0 30.6 51.2 81.8 254.6 84.5 339.2 Utah....................................................... 81.1 3.7 4.9 8.6 54.6 0.0 54.6 Vermont.................................................... 47.4 7.7 4.7 12.4 31.9 5.7 37.6 Virginia................................................... 158.3 29.2 15.8 45.0 97.6 32.3 129.9 Washington................................................. 403.3 121.0 0.0 121.0 84.0 128.3 212.3 West Virginia.............................................. 110.2 10.0 11.0 21.0 0.0 14.6 14.6 Wisconsin.................................................. 317.5 63.5 31.8 95.3 50.2 103.1 153.4 Wyoming.................................................... 20.8 4.1 2.1 6.2 2.7 0.7 3.4 ------------------------------------------------------------------------------------------- Total................................................... 16,712.6 1,764.0 1,028.2 2,792.2 8,002.9 3,320.4 11,323.2 -------------------------------------------------------------------------------------------------------------------------------------------------------- Source: Table prepared by the Congressional Research Service based on data from the U.S. Department of Health and Human Services. Fiscal year 1999 Temporary Assistance for Needy Families (TANF) expenditures, including State-funded MOE spending, totaled $22.6 billion (table 7-18). Because it includes all State-funded MOE child care, this sum is higher than the $21.7 billion fiscal year 1999 total shown in table 7-15. The difference represents child care outlays that can be counted for both the TANF and CCDF MOE. Of the $22.6 billion total, $13.5 billion (59.6 percent) was used for cash and work-based assistance, $1.8 billion (7.8 percent) for work activities; $2.0 billion (8.8 percent) for child care; $2.3 billion (10.1 percent) for administration and computerization needed for tracking and monitoring, and $3.1 billion (13.7 percent) for other purposes. The table shows sharp State variations. In 14 States (Alabama, Arkansas, Colorado, Delaware, Idaho, Indiana, Kansas, Michigan, Nevada, North Carolina, Oklahoma, South Carolina, Texas, and Wisconsin) cash and work-based assistance accounted for less than half of expenditures. At the other extreme, three States (Hawaii, New Mexico, and Vermont) attributed more than 80 percent of their spending to cash and work-based help. In 10 States child care accounted for 10 percent or more of TANF outlays (Alabama, Connecticut, Delaware, District of Columbia, Illinois, Massachusetts, Michigan, Minnesota, Missouri, New Jersey, North Carolina, Ohio, Oklahoma, and Wisconsin). State maintenance-of-effort expenditures.--Table 7-19 shows total fiscal year 1999 State TANF maintenance-of-effort (MOE) expenditures broken down by three categories: expenditures under the regular TANF Program, State child care expenditures, and expenditures under separate State programs (SSPs). Inclusion of all MOE child care expenditures ($1.4 billion) raises total State spending to $11.3 billion (compared with $10.4 billion in table 7-16, which excludes $856 million in child care that could be double counted for both the TANF and Child Care and Development Fund (CCDF) MOE. Nationally, expenditures under the regular TANF Program accounted for 82.2 percent of State MOE spending, child care for 12.4 percent, and SSP programs for 5.4 percent. A total of 21 States reported MOE expenditures (other than child care) under SSPs. Two States (Hawaii and Tennessee) reported using no MOE funds for child care. Expenditures per family.--Table 7-20 shows expenditures (excluding TANF MOE spending that also could be counted toward the CCDF MOE) per family for each year from fiscal year 1995 to fiscal year 1999. Expenditures per family did not change much between fiscal years 1995 and 1996, fell slightly in fiscal year 1997, then rose. Over the 4-year period, per-family expenditures were up $2,088, or 33.5 percent). However, caution should be used in interpreting these numbers. The counts of families reflect only those receiving TANF ``assistance.'' Some States have moved families that were considered Aid to Families with Dependent Children (AFDC) families into SSPs other than TANF. For example, some States aid two-parent families and/or child-only cases in an SSP. Some forms of aid might not be considered by a State to be TANF assistance, and families receiving such aid might not be counted as a TANF family. Both of these factors would reduce the reported number of recipient families and thus inflate the calculated expenditure per family. TABLE 7-18.--TOTAL TANF AND TANF MOE EXPENDITURES, BY STATE AND MAJOR CATEGORY, FISCAL YEAR 1999 [In millions of dollars] ---------------------------------------------------------------------------------------------------------------- Cash and State work-based Work Child Administration Other Total assistance activities care and systems expenditures ---------------------------------------------------------------------------------------------------------------- Alabama................................ $35.3 $15.4 $14.4 $10.7 $15.1 $90.9 Alaska................................. 64.0 10.3 5.1 8.5 0.5 88.4 Arizona................................ 121.6 14.5 12.3 34.1 57.2 239.7 Arkansas............................... 23.8 22.0 5.1 7.6 13.0 71.6 California............................. 4,289.9 311.7 411.6 425.3 813.5 6,252.1 Colorado............................... 55.1 8.8 10.8 15.4 69.4 159.5 Connecticut............................ 199.3 15.6 103.8 36.5 30.2 385.4 Delaware............................... 23.7 10.2 11.9 13.5 0.0 59.4 District of Columbia................... 80.1 17.5 16.0 12.7 2.0 128.3 Florida................................ 306.4 104.9 34.4 30.9 7.4 483.9 Georgia................................ 206.8 30.7 35.2 39.1 98.1 409.9 Hawaii................................. 148.9 5.7 0.0 13.3 0.0 167.9 Idaho.................................. 4.2 1.8 1.2 3.1 16.3 26.7 Illinois............................... 574.1 33.3 117.0 115.3 0.0 839.6 Indiana................................ 85.3 13.1 15.4 44.3 29.8 187.8 Iowa................................... 91.9 24.3 6.2 29.1 23.7 175.2 Kansas................................. 45.7 7.5 6.7 9.4 106.5 175.8 Kentucky............................... 120.1 20.7 15.9 22.5 29.1 208.4 Louisiana.............................. 67.1 14.2 5.2 20.8 21.0 128.3 Maine.................................. 74.3 9.8 7.1 12.3 5.1 108.6 Maryland............................... 189.2 49.5 26.1 58.0 5.5 328.3 Massachusetts.......................... 331.1 35.4 86.9 86.9 91.2 631.5 Michigan............................... 435.3 151.7 308.5 60.3 78.5 1,034.2 Minnesota.............................. 233.8 45.0 50.4 47.8 0.3 377.3 Mississippi............................ 26.7 7.4 1.7 7.6 0.8 44.3 Missouri............................... 165.5 40.8 43.1 20.6 46.6 316.5 Montana................................ 25.5 5.3 1.3 6.1 2.3 40.6 Nebraska............................... 68.1 16.5 6.5 25.1 0.0 116.2 Nevada................................. 27.6 1.5 2.2 13.4 20.0 64.7 New Hampshire.......................... 36.3 3.5 4.6 9.6 6.0 60.1 New Jersey............................. 302.0 31.9 47.9 67.7 0.0 449.6 New Mexico............................. 108.4 0.0 2.9 8.0 10.4 129.8 New York............................... 2,347.2 179.9 182.0 442.6 500.6 3,652.3 North Carolina......................... 176.0 3.7 43.9 29.4 141.1 394.1 North Dakota........................... 22.0 1.6 1.0 5.7 2.6 33.0 Ohio................................... 380.4 4.7 68.8 98.0 104.3 656.2 Oklahoma............................... 57.9 31.4 27.4 8.7 25.2 150.7 Oregon................................. 177.0 54.2 19.9 34.6 0.6 286.3 Pennsylvania........................... 529.9 72.0 46.6 79.8 309.7 1,038.0 Rhode Island........................... 115.0 7.6 14.3 17.7 9.7 164.3 South Carolina......................... 38.6 22.9 4.1 19.7 21.6 106.9 South Dakota........................... 11.3 3.3 0.8 3.3 2.9 21.6 Tennessee.............................. 110.0 34.4 4.7 19.6 40.1 208.8 Texas.................................. 233.4 47.5 34.7 62.3 212.7 590.6 Utah................................... 40.6 25.5 4.5 9.3 0.1 79.9 Vermont................................ 52.3 0.3 4.4 8.0 0.0 65.0 Virginia............................... 140.2 60.8 21.9 35.0 0.3 258.1 Washington............................. 316.9 39.2 34.1 58.5 55.4 504.0 West Virginia.......................... 32.7 3.1 3.0 18.8 0.6 58.2 Wisconsin.............................. 90.7 80.0 60.5 23.0 68.1 322.2 Wyoming................................ 10.4 1.5 1.6 0.8 0.0 14.3 ----------------------------------------------------------------------- Total............................... 13,449.5 1,754.0 1,995.5 2,290.7 3,095.2 22,584.9 ======================================================================= Percent of total........................ 59.6 7.8 8.8 10.1 13.7 100.0 ---------------------------------------------------------------------------------------------------------------- Source: Table prepared by the Congressional Research Service based on data from the U.S. Department of Health and Human Services. TABLE 7-19.--STATE MAINTENANCE-OF-EFFORT EXPENDITURES BY PROGRAM CATEGORY, FISCAL YEAR 1999 [In millions of dollars] ---------------------------------------------------------------------------------------------------------------- Total State Child Separate expenditures expenditures Total care State minus child State under the child that program Total care that TANF Program care can be expenditures expenditures can be (excluding double (excluding double child care) counted child care) counted ---------------------------------------------------------------------------------------------------------------- Alabama............................... $32.2 $6.9 $6.9 $0.1 $39.2 $32.3 Alaska............................... 47.2 3.0 3.0 0.0 50.2 47.2 Arizona.............................. 87.5 10.0 10.0 0.0 97.6 87.5 Arkansas............................. 21.1 5.1 1.9 0.0 26.2 24.3 California........................... 2,617.2 240.2 85.6 49.2 2,906.6 2,821.0 Colorado............................. 78.6 10.8 9.0 0.0 89.4 80.4 Connecticut.......................... 96.2 68.1 18.7 19.2 183.4 164.7 Delaware............................. 14.1 11.9 5.2 0.6 26.7 21.5 District of Columbia................. 61.1 16.0 4.6 0.0 77.1 72.5 Florida.............................. 313.4 34.4 33.4 23.2 371.0 337.6 Georgia.............................. 79.0 35.2 22.2 60.5 174.8 152.6 Hawaii............................... 32.3 0.0 0.0 48.6 81.0 81.0 Idaho................................ 13.3 1.2 1.2 0.0 14.4 13.3 Illinois............................. 308.1 81.8 56.9 40.2 430.1 373.2 Indiana.............................. 80.7 15.4 15.4 25.0 121.1 105.7 Iowa................................. 55.7 6.2 5.1 0.1 62.0 56.9 Kansas............................... 61.7 6.7 6.7 0.0 68.3 61.7 Kentucky............................. 76.5 5.6 5.6 0.0 82.1 76.5 Louisiana............................ 53.9 5.2 5.2 0.0 59.1 53.9 Maine................................ 16.2 7.1 1.7 17.3 40.6 38.8 Maryland............................. 120.1 23.6 23.3 33.2 177.0 153.7 Massachusetts........................ 309.5 49.4 45.0 2.1 361.0 316.1 Michigan............................. 362.7 97.3 24.4 11.3 471.3 446.9 Minnesota............................ 149.6 50.4 19.7 0.3 200.3 180.6 Mississippi.......................... 21.5 1.7 1.7 0.0 23.2 21.5 Missouri............................. 85.0 43.1 16.5 0.0 128.1 111.6 Montana.............................. 14.4 1.3 1.3 0.0 15.7 14.4 Nebraska............................. 24.0 6.5 6.5 0.0 30.5 24.0 Nevada............................... 25.0 2.2 2.2 0.0 27.2 25.0 New Hampshire........................ 27.5 4.6 4.6 0.0 32.1 27.5 New Jersey........................... 273.1 26.4 26.4 0.6 300.2 273.8 New Mexico........................... 37.1 2.9 2.9 0.0 39.9 37.1 New York............................. 1,694.9 182.0 102.0 241.8 2,118.7 2,016.7 North Carolina....................... 128.5 42.8 37.9 0.0 171.3 133.4 North Dakota......................... 8.1 1.0 1.0 0.0 9.1 8.1 Ohio................................. 364.4 49.4 45.4 0.0 413.8 368.4 Oklahoma............................. 48.4 16.9 10.6 0.0 65.3 54.7 Oregon............................... 77.5 14.1 11.7 0.0 91.6 79.9 Pennsylvania......................... 387.6 46.6 46.6 0.0 434.3 387.6 Rhode Island......................... 45.8 14.3 5.3 9.4 69.4 64.1 South Carolina....................... 31.8 4.1 4.1 0.0 35.9 31.8 South Dakota......................... 8.3 0.8 0.8 0.0 9.1 8.3 Tennessee............................ 88.3 0.0 0.0 0.0 88.3 88.3 Texas................................ 216.8 34.7 34.7 0.0 251.4 216.8 Utah................................. 19.9 4.5 4.5 0.9 25.3 20.8 Vermont.............................. 24.0 3.4 2.7 0.0 27.4 24.7 Virginia............................. 84.1 21.3 21.3 22.7 128.2 106.8 Washington........................... 257.6 34.1 34.1 0.0 291.7 257.6 West Virginia........................ 40.6 3.0 3.0 0.0 43.6 40.6 Wisconsin............................ 130.9 36.3 16.4 1.7 168.9 152.4 Wyoming.............................. 9.3 1.6 1.6 0.0 10.9 9.3 ------------------------------------------------------------------------- Total............................. 9,262.4 1,391.1 856.4 608.2 11,261.6 10,405.2 ---------------------------------------------------------------------------------------------------------------- Source: Table prepared by the Congressional Research Service based on data from the U.S. Department of Health and Human Services. TABLE 7-20.--TOTAL TANF/AFDC AND RELATED PROGRAM EXPENDITURES PER FAMILY (EXCLUDES TANF MOE EXPENDITURES THAT COULD ALSO BE COUNTED TOWARD THE CCDF MOE), BY STATE, FISCAL YEARS 1995-99 -------------------------------------------------------------------------------------------------------------------------------------------------------- Percent State 1995 1996 1997 1998 1999 Change 1995- change: 99 1995-98 -------------------------------------------------------------------------------------------------------------------------------------------------------- Alabama...................................................... $2,840 $2,933 $2,988 $3,970 $4,144 $1,304 45.9 Alaska...................................................... 9,716 9,843 10,139 9,619 10,092 376 3.9 Arizona..................................................... 4,797 4,991 5,143 6,060 6,734 1,937 40.4 Arkansas.................................................... 2,932 3,585 3,652 4,159 5,841 2,909 99.2 California.................................................. 8,058 7,869 7,143 7,866 9,881 1,822 22.6 Colorado.................................................... 6,465 7,547 7,079 8,234 10,553 4,088 63.2 Connecticut................................................. 9,036 7,538 7,091 8,940 10,805 1,769 19.6 Delaware.................................................... 6,476 5,720 5,288 6,984 8,685 2,209 34.1 District of Columbia........................................ 6,177 5,922 5,378 6,820 6,493 315 5.1 Florida..................................................... 4,313 4,368 4,327 6,167 5,494 1,180 27.4 Georgia..................................................... 3,777 3,891 4,235 5,581 6,235 2,458 65.1 Hawaii...................................................... 9,240 8,878 6,380 10,156 10,500 1,260 13.6 Idaho....................................................... 5,738 5,589 2,377 10,441 18,461 12,724 221.8 Illinois.................................................... 4,977 5,232 4,703 5,690 6,376 1,399 28.1 Indiana..................................................... 4,292 3,834 3,962 4,418 4,698 406 9.5 Iowa........................................................ 5,804 6,594 6,213 6,795 7,750 1,946 33.5 Kansas...................................................... 5,694 6,109 8,390 8,600 13,170 7,476 131.3 Kentucky.................................................... 3,158 3,631 3,460 3,680 4,757 1,599 50.6 Louisiana................................................... 2,713 2,564 2,747 3,457 3,127 414 15.3 Maine....................................................... 5,534 5,918 6,270 6,989 7,929 2,395 43.3 Maryland.................................................... 5,794 5,562 5,127 6,136 8,777 2,983 51.5 Massachusetts............................................... 8,061 8,317 8,512 9,375 10,769 2,708 33.6 Michigan.................................................... 6,302 5,854 7,057 8,118 10,607 4,305 68.3 Minnesota................................................... 7,678 7,680 5,434 7,438 8,421 744 9.7 Mississippi................................................. 2,134 1,980 2,296 3,969 2,558 425 19.9 Missouri.................................................... 4,055 4,355 4,311 4,942 5,892 1,837 45.3 Montana..................................................... 5,917 5,483 5,899 6,715 8,138 2,221 37.5 Nebraska.................................................... 7,143 7,170 4,912 4,880 9,673 2,529 35.4 Nevada...................................................... 5,393 5,530 5,759 7,668 7,781 2,388 44.3 New Hampshire............................................... 7,006 7,591 7,924 9,036 8,712 1,705 24.3 New Jersey.................................................. 6,602 6,350 5,460 6,050 6,799 197 3.0 New Mexico.................................................. 5,340 5,457 5,950 5,212 4,975 -365 -6.8 New York.................................................... 11,012 10,754 9,845 9,505 12,058 1,046 9.5 North Carolina.............................................. 4,256 4,688 4,621 4,755 6,003 1,747 41.0 North Dakota................................................ 8,182 8,230 8,824 10,278 10,313 2,131 26.0 Ohio........................................................ 4,666 4,668 4,441 4,997 5,367 702 15.0 Oklahoma.................................................... 4,557 5,099 4,481 5,402 6,982 2,425 53.2 Oregon...................................................... 7,072 7,613 9,579 11,202 16,277 9,205 130.2 Pennsylvania................................................ 7,332 7,860 5,682 7,016 9,383 2,051 28.0 Rhode Island................................................ 7,636 7,274 7,781 8,208 8,839 1,203 15.8 South Carolina.............................................. 2,979 3,396 3,582 4,099 5,597 2,617 87.8 South Dakota................................................ 5,086 5,381 5,321 6,044 6,435 1,350 26.5 Tennessee................................................... 2,849 2,951 3,289 3,620 3,623 774 27.2 Texas....................................................... 2,905 2,906 2,960 3,808 4,872 1,967 67.7 Utah........................................................ 6,423 6,994 6,943 8,027 7,698 1,274 19.8 Vermont..................................................... 8,027 7,876 7,392 7,512 9,430 1,403 17.5 Virginia.................................................... 3,947 4,017 4,122 5,036 6,396 2,449 62.1 Washington.................................................. 7,480 7,835 6,565 7,407 7,502 22 0.3 West Virginia............................................... 3,504 3,744 3,336 3,998 4,825 1,321 37.7 Wisconsin................................................... 7,238 6,977 8,704 22,378 15,975 8,737 120.7 Wyoming..................................................... 5,920 5,244 5,780 7,967 15,725 9,805 165.6 ------------------------------------------------------------------------------------------ Total.................................................... 6,242 6,269 5,958 6,865 8,330 2,088 33.5 -------------------------------------------------------------------------------------------------------------------------------------------------------- Note.--Excludes State TANF maintenance-of-effort child care expenditures that can also be counted toward the Child Care and Development Fund maintenance- of-effort requirement. Source: Table prepared by the Congressional Research Service based on data from the U.S. Department of Health and Human Services. Breakdown of expenditures.--As chart 7-3 shows, the bulk of fiscal year 1999 expenditures were made for cash assistance. Cash assistance accounted for spending of $13.4 billion, 60 percent of total Federal and State MOE expenditures (down from $14.6 billion in fiscal year 1998, 65 percent of total TANF spending). The second largest category was ``unclassified'' expenditures; that is, expenditures that did not fit into any of the other categories (cash, work program expenditures, child care, administration, and transitional assistance). The U.S. Department of Health and Human Services (DHHS) did not collect details on unclassified expenditures for fiscal year 1999, but this category could include payments for nonassistance such as transportation and work expenses. Unclassified expenditures were 14 percent of all expenditures; administrative costs accounted for 10 percent, child care for 9 percent, and work program expenditures totaled 8 percent. CHART 7-3. FISCAL YEAR 1999 FEDERAL AND STATE TANF AND RELATED PROGRAM EXPENDITURES, BY CATEGORY. INCLUDES TANF CHILD CARE AND STATE CHILD CARE EXPENDITURES. [DOLLARS IN BILLIONS] Note._Details may not add to total because of rounding. Source: Chart prepared by the Congressional Research Service based on data from the U.S. Department of Health and Human Services. Child care expenditures totaled $2.0 billion. Most of these expenditures ($1.4 billion) were State child care expenditures counted toward the TANF MOE requirement. Only $0.6 billion was spent directly on child care from Federal TANF grants. However, most Federal funding for child care is provided through the CCDF (not shown in this section).\5\ --------------------------------------------------------------------------- \5\ For a discussion of CCDF Programs, see Congressional Research Service (1998). --------------------------------------------------------------------------- Work Activities and Participation Participation rates, fiscal year 1998 All jurisdictions except Guam, Puerto Rico, and the Virgin Islands achieved the all-family work rate in fiscal year 1998, but 15 failed the higher two-parent family work rate (two States and two territories reported having no two-parent families). The statutory minimums for fiscal year 1998 were 30 percent for all families and 75 percent for two-parent families; but, as shown in table 7-21, actual State standards were adjusted downward to give credit for reductions in caseload from fiscal year 1995 to fiscal year 1997 and, in the case of Vermont, to reflect terms of pre-TANF waivers still in effect. The six States that placed two-parent families in non- TANF Programs in fiscal year 1998 were Alabama, Florida, Georgia, Hawaii, Maryland, and New Jersey. Since then seven other States have moved two-parent families into SSPs: California and Connecticut, which met their fiscal year 1998 adjusted work targets of 33 percent and 67 percent, respectively, Delaware, Nebraska, Rhode island, and Virginia, which failed their adjusted targets, which averaged 52 percent, and South Dakota, which reported no two-parent cases in fiscal year 1998. States that failed their minimum work participation rates are subject to a penalty (for first year's failure, loss of 5 percent of the TANF Block Grant, for second year's failure, 7 percent of the grant, with the penalty based on ``the degree of noncompliance''), and under the law they must spend from State funds an amount equal to their penalties; finally, their required State MOE requirement is increased to 80 percent of its historic level. Penalties for failure to meet fiscal year 1998 two-parent work rates are shown in table 7-22. The law permits States that fail to achieve work rates to submit a corrective action plan or appeal the penalty on grounds of reasonable cause. In addition to the four named above, the jurisdictions that failed their fiscal year 1998 two-parent family work requirement were Alaska, Arkansas, District of Columbia, Guam, Minnesota, New Mexico, North Carolina, Pennsylvania, Texas, Washington, and West Virginia. In final TANF regulations, DHHS said States that offered TANF to noncustodial parents could choose whether to include them in calculating work participation rates of two-parent families. In fiscal year 1997, 16 States had failed the two-parent work requirements. Penalties were imposed on 2 States, and the other 14 States entered into ``corrective compliance'' plans.\6\ The National Council of State Human Services Administrators on March 9, 1999, --------------------------------------------------------------------------- \6\ A corrective compliance plan must include an analysis of why the State failed the requirement and describe how, and by what time, it will discontinue the violation. A DHHS official said that if penalized States moved two-parent families into separate State programs, they would be required to achieve specified work rates for these families in accordance with a corrective compliance plan in order to have the penalty waived on grounds of corrective compliance. TABLE 7-21.--TANF WORK PARTICIPATION RATES, FISCAL YEAR 1998 [In percent] -------------------------------------------------------------------------------------------------------------------------------------------------------- Overall rate Two-person rate ----------------------------------------------------------------------------------------------------------------- Two-parent State Caseload Adjusted Participation Caseload Adjusted Participation cases in reduction target rate achieved Met target reduction target rate achieved Met target caseload credit credit (percent) -------------------------------------------------------------------------------------------------------------------------------------------------------- Alabama............................... 25.0 5.0 38.9 yes (\1\) (\1\) (\1\) (\1\) (\1\) Alaska................................ 3.2 26.8 42.5 yes 6.4 68.6 36.8 no 14.7 Arizona............................... 21.3 8.7 30.2 yes 21.3 53.7 76.6 yes 1.8 Arkansas.............................. 13.4 16.6 19.4 yes 17.2 57.8 20.3 no 1.0 California............................ 12.3 17.7 36.6 yes 42.3 32.7 36.2 yes 17.3 Colorado.............................. 22.5 7.5 28.7 yes 59.9 15.1 25.7 yes 1.0 Connecticut........................... 8.5 21.5 41.4 yes 8.5 66.5 73.2 yes 6.3 Delaware.............................. 20.6 9.4 26.2 yes 20.6 54.4 23.7 no 1.9 District of Columbia.................. 9.9 20.1 22.8 yes 44.9 30.1 22.5 no 0.5 Florida............................... 24.2 5.8 34.5 yes (\1\) (\1\) (\1\) (\1\) (\1\) Georgia............................... 23.9 6.1 29.3 yes (\1\) (\1\) (\1\) (\1\) (\1\) Guam.................................. 0.0 30.0 12.4 no 0.0 75.0 13.8 no 8.1 Hawaii................................ 1.9 28.1 30.0 yes (\1\) (\1\) (\1\) (\1\) (\1\) Idaho................................. 25.8 4.2 28.6 yes 77.0 0.0 22.5 yes 2.4 Illinois.............................. 16.4 13.6 37.7 yes 30.0 45.0 77.7 yes 4.3 Indiana............................... 31.9 0.0 29.9 yes 54.9 20.1 32.8 yes 2.2 Iowa.................................. 20.9 9.1 56.9 yes 23.6 51.4 53.6 yes 9.1 Kansas................................ 28.1 1.9 41.3 yes 51.8 23.2 44.2 yes 4 Kentucky.............................. 13.7 16.3 38.3 yes 37.5 37.5 51.6 yes 3.6 Louisiana............................. 28.0 2.0 29.2 yes 77.1 0.0 38.1 yes 0.3 Maine................................. 14.9 15.1 45.6 yes 39.7 35.3 49.9 yes 6.2 Maryland.............................. 26.9 3.1 12.7 yes (\1\) (\1\) (\1\) (\1\) (\1\) Massachusetts......................... 22.7 7.3 29.0 yes 30.4 44.6 73.3 yes 3.1 Michigan.............................. 24.8 5.2 49.2 yes 36.6 38.4 63.9 yes 9.6 Minnesota............................. 13.0 17.0 30.6 yes 32.5 42.5 30.8 no 6.2 Mississippi........................... 26.3 3.7 25.2 yes 73.8 1.2 70.4 yes 0.0 Missouri.............................. 19.6 10.4 24.1 yes 79.7 0.0 34.9 yes 0.7 Montana............................... 22.8 7.2 78.3 yes 22.8 52.2 86.4 yes 10.9 Nebraska.............................. 9.4 20.6 36.2 yes 21.9 53.1 39.5 no 4.4 Nevada................................ 24.0 6.0 34.5 yes 43.3 31.7 58.7 yes 1.9 New Hampshire......................... 24.5 5.5 37.3 yes 73.4 1.6 44.6 yes 0.9 New Jersey............................ 15.3 14.7 26.5 yes (\1\) (\1\) (\1\) (\1\) (\2\) New Mexico............................ 21.5 8.5 15.9 yes 39.4 35.6 16.8 no 3.2 New York.............................. 15.0 15.0 37.5 yes 36.5 38.5 58.8 Yes 3.2 North Carolina........................ 20.0 10.0 14.5 yes 20.0 55.0 30.9 no 2.5 North Dakota.......................... 19.3 10.7 31.5 yes (\2\) (\2\) (\2\) (\2\) (\2\) Ohio.................................. 18.4 11.6 44.9 yes 25.8 49.2 51.5 yes 6.6 Oklahoma.............................. 32.3 0.0 36.2 yes 70.8 4.2 31.4 yes 0.4 Oregon................................ 38.7 0.0 98.2 yes 65.2 9.8 95.2 yes 4.1 Pennsylvania.......................... 20.1 9.9 19.3 yes 48.7 26.3 21.8 no 2.6 Puerto Rico........................... 12.9 17.1 6.8 no (\2\) (\2\) (\2\) (\2\) (\2\) Rhode Island.......................... 10.7 19.3 27.5 yes 23.9 51.1 32.4 no 2.4 South Carolina........................ 11.0 19.0 42.7 yes 26.5 48.5 60.9 yes 0.5 South Dakota.......................... 18.8 11.2 39.2 yes (\2\) (\2\) (\2\) (\2\) (\2\) Tennessee............................. 28.0 2.0 43.2 yes 70.4 4.6 39.1 yes 0.7 Texas................................. 24.8 5.2 25.2 yes 27.1 47.9 44.3 no 8.9 Utah.................................. 27.5 2.5 39.8 yes 27.5 47.5 49.7 yes 1.3 Vermont............................... (\3\) (\3\) (\3\) (\3\) (\3\) (\3\) (\3\) (\3\) (\3\) Virginia.............................. 23.2 6.8 27.5 yes 23.2 51.8 26.5 no 1.1 Virgin Islands........................ 2.3 27.7 15.5 no (\2\) (\2\) (\2\) (\2\) (\2\) Washington............................ 8.9 21.1 48.5 yes 22.8 52.2 45.5 no 12.8 West Virginia......................... 10.8 19.2 33.4 yes 28.2 46.8 37.2 no 11.2 Wisconsin............................. 46.3 0.0 64.0 yes 76.7 0.0 39.2 yes 3.6 Wyoming............................... 32.2 0.0 55.3 yes 70.1 4.9 65.8 yes 0.7 -------------------------------------------------------------------------------------------------------------------------------------------------------- \1\ Two-parent cases funded through separate State program. \2\ No two-parent cases or program. \3\ Not subject to participation rates as State claims waiver inconsistencies exempt all cases from participation rates. Note.--The work participation rate standard before the application of the caseload reduction credit was 30 percent for the overall rate and 75 percent for the two-parent rate. Source: Administration for Children and Families, U.S. Department of Health and Human Services. TABLE 7-22.--PENALTIES FOR FAILING FISCAL YEAR 1998 TANF WORK PARTICIPATION RATE FOR TWO-PARENT FAMILIES (PROPORTIONAL REDUCTION BASED ON DEGREE OF FAILURE) [Penalties in thousands of dollars] -------------------------------------------------------------------------------------------------------------------------------------------------------- Percent of Adjusted Rate adjusted Base Reduced for Proportionally Reduced for State standard achieved standard penalty percent of reduced two-parent (percent) (percent) achieved year penalty percentage -------------------------------------------------------------------------------------------------------------------------------------------------------- Alaska.................................................... 68.6 36.8 53.6 $2,893.1 $2,169.8 $1,005.8 $143.8 Arkansas.................................................. 57.8 20.3 35.1 2,836.6 2,127.5 1,380.3 23.5 Delaware.................................................. 54.4 23.7 43.6 1,453.1 1,453.1 820.0 29.5 District of Columbia...................................... 30.1 21.9 72.8 1,853.1 1,853.1 504.8 1.5 Minnesota................................................. 42.5 30.8 72.5 12,844.7 9,633.5 2,652.1 251.9 Nebraska.................................................. 53.1 39.5 74.4 1,168.7 1,168.7 299.3 19.5 New Mexico................................................ 35.6 16.8 47.2 5,639.9 4,229.9 2,233.8 223.4 North Carolina............................................ 55.0 30.9 56.2 5,804.3 5,804.3 2,543.3 35.6 Pennsylvania.............................................. 26.3 21.8 82.9 33,324.8 33,324.8 5,702.0 256.6 Rhode Island.............................................. 51.1 32.4 63.4 4,751.1 4,355.2 1,593.8 90.8 Texas..................................................... 47.9 44.3 92.5 9,146.8 9,146.8 687.4 38.5 Virginia.................................................. 51.8 26.5 51.2 2,459.5 2,459.5 1,201.3 24.0 Washington................................................ 52.2 45.5 87.2 7,740.8 7,740.8 993.6 103.3 West Virginia............................................. 46.8 39.2 83.8 1,856.0 1,856.0 301.4 34.4 -------------------------------------------------------------------------------------------------------------------------------------------------------- Source: Office of Family Assistance, U.S. Department of Health and Human Services. adopted a resolution calling on the administration and Congress to consider modifying the two-parent work rules. Effective in fiscal year 1999, the statutory two-parent work participation rate rose to 90 percent. DHHS reports that nationally, 35.4 percent of all Temporary Assistance for Needy Families (TANF) families and 42.3 percent of two-parent TANF families were credited with work participation in fiscal year 1998. (This means that they engaged in creditable activities for the required hours.) Participation rates show participants as a percentage of all families with an adult recipient (excluding those exempt from work because of having a child under 1 or because of a pre-TANF waiver, and those under work-refusal sanction for less than 3 months). Rates achieved varied widely: for the overall rate, from 12.7 percent in Maryland (and lower in Puerto Rico and Guam) to 98.2 percent in Oregon; for the two-parent rate, from 16.8 percent in New Mexico (and 13 percent in Guam) to 95.2 percent in Oregon. Work activities Participants in work activities recognized in TANF law.--As noted earlier, TANF law lists 12 activities that are countable in determining whether a State has achieved the required work participation rate. Table 7-23 shows the number of persons (adults or teen parents) in all TANF families who were credited with work and their work activities in fiscal year 1998. Because some persons participated in more than one activity, a percentage breakdown is not possible by activity. However, unsubsidized employment was by far the leading activity. Out of 699,573 families that met the overall work requirement, 490,837 persons had unsubsidized jobs. In the all-family group, the next most popular work activities were job search, with 87,371 participants, and work experience, with 83,376 persons. Three varieties of educational activities (vocational education, satisfactory school attendance, and education related to employment) accounted for 74,241 participants. Table 7-24 shows that a total of 61,208 two-parent families met the work participation standard in fiscal year 1998. Among them were 68,236 adult family members who had unsubsidized jobs (in some families, both parents worked), 10,630 who performed job search, 8,057 who engaged in work experience, and 4,823 who undertook educational activities. In the JOBS Program for AFDC adults, education was the dominant work-related activity. In fiscal year 1995, 39.4 percent of JOBS participants were engaged in educational activities (high school, general education degree, remedial education, English as a second language, or higher education). Another 7.8 percent were engaged in vocational training (Committee, 1998, p. 482). In contrast, under TANF, only 10.6 percent of all adults, and 3.9 percent of those in two-parent families, who were credited with work during fiscal year 1998 engaged in one of the three listed educational activities (vocational education, satisfactory school attendance, and education related to employment). A GAO official told a subcommittee of the House Committee on Education and the Workforce in September, 1999, that under TANF ``education and vocational TABLE 7-23.--TANF WORK PARTICIPANTS \1\ FOR ALL-FAMILY CATEGORY BY WORK ACTIVITY, FISCAL YEAR 1998 ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ Average monthly number of persons engaged in work by work activity Number of ------------------------------------------------------------------------------------------------------------------------------ State participating On-the- Job Education Satisfactory Providing families Unsubsidized Subsidized Work job Job Community Vocational skills related to school child employment employment experience training search service education training employment attendance care ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ Alabama........................................... 3,674 2,278 -- 405 16 832 53 404 28 -- 192 -- Alaska............................................ 3,465 2,471 8 90 14 585 273 589 -- -- 46 -- Arizona........................................... 7,278 6,662 3 742 6 748 88 528 54 21 104 -- Arkansas.......................................... 1,384 453 26 125 94 433 22 250 -- 9 39 10 California........................................ 179,953 156,384 2118 1,639 308 9,959 5,048 4,498 338 1,563 1,630 924 Colorado.......................................... 3,608 1,894 165 402 11 255 197 1,135 11 -- 44 -- Connecticut....................................... 15,439 13,633 -- 462 11 1,594 -- 645 -- -- 64 -- Delaware.......................................... 924 882 -- -- -- 108 1 4 -- -- -- -- District of Columbia.............................. 3,685 3,174 432 347 122 854 51 59 21 29 -- -- Florida........................................... 19,854 14,990 136 438 -- 1,174 1,251 1,287 55 50 2,421 193 Georgia........................................... 13,271 5,994 316 3,315 47 1,584 807 2,463 50 6 696 39 Guam.............................................. 160 30 -- -- -- -- 131 -- -- -- -- -- Hawaii............................................ 3,449 2,425 113 917 38 787 37 338 -- 6 -- -- Idaho............................................. 284 135 6 18 1 115 4 91 -- 1 2 -- Illinois.......................................... 45,747 33,295 4 4,558 -- 7,215 155 2,823 -- -- 849 -- Indiana........................................... 9,262 8,792 7 107 15 706 -- 310 85 124 124 -- Iowa.............................................. 10,585 9,848 -- 84 1 165 14 1,530 -- -- 168 -- Kansas............................................ 3,222 2,063 -- 733 5 1,148 4 40 55 154 -- -- Kentucky.......................................... 12,931 7,090 -- 3,227 54 265 267 2,650 1 -- 243 -- Louisiana......................................... 8,754 5,305 51 2,244 17 305 -- 1,855 -- 23 23 -- Maine............................................. 5,068 2,813 -- 222 13 2,073 720 275 122 2 300 14 Maryland.......................................... 3,947 1,834 98 643 15 1,348 -- 202 -- -- 34 -- Massachusetts..................................... 12,479 7,773 405 125 -- 621 1,420 639 720 218 992 44 Michigan.......................................... 43,470 40,917 86 -- 88 3,013 16 272 35 50 782 -- Minnesota......................................... 11,296 8,514 1 23 -- 2,312 44 1,071 5 80 1,476 1 Mississippi....................................... 3,018 1,789 177 492 1 590 203 264 1 6 2 -- Missouri.......................................... 6,521 3,195 218 1,329 28 1,189 -- -- 864 622 215 -- Montana........................................... 3,417 762 -- 1,912 -- 3,030 18 480 -- -- 42 -- Nebraska.......................................... 3,218 2,052 -- 14 20 1,481 27 109 83 -- 204 -- Nevada............................................ 1,810 1,454 16 30 -- 163 142 196 4 -- 11 -- New Hampshire..................................... 1,188 858 -- 57 3 166 -- 123 64 -- 123 -- New Jersey........................................ 14,276 5,570 -- 7,172 40 2,060 7 1,948 58 436 192 10 New Mexico........................................ 2,801 2,503 28 187 -- 14 79 43 13 -- 13 -- New York.......................................... 83,781 39,020 851 25,568 178 4,514 10,151 10,306 177 39 169 -- North Carolina.................................... 5,297 3,972 176 436 -- 260 -- 1,263 -- -- 106 -- North Dakota...................................... 550 281 -- 175 1 43 33 78 4 15 1 -- Ohio.............................................. 42,023 24,211 278 13,667 9 6,434 -- 5,356 -- 10 1,677 -- Oklahoma.......................................... 5,425 2,718 20 505 6 928 -- 1,249 -- -- -- -- Oregon............................................ 1,479 727 174 174 8 494 -- -- 57 62 133 -- Pennsylvania...................................... 17,735 13,937 -- 110 10 3,518 -- 1,160 -- 16 52 -- Puerto Rico....................................... 75 30 -- -- -- 45 -- -- -- -- -- -- Rhode Island...................................... 3,996 2,682 101 141 3 392 -- 1,011 -- 26 13 -- South Carolina.................................... 5,067 4,249 14 198 26 909 12 140 82 12 47 -- South Dakota...................................... 890 246 -- -- 24 190 461 73 13 52 3 -- Tennessee......................................... 11,698 6,629 -- 222 2,012 2,382 -- 1,635 -- -- 1,046 -- Texas............................................. 7,484 3,289 27 1,033 53 3,320 1 333 -- 691 465 -- Utah.............................................. 3,654 2,463 -- -- 3 1,606 -- -- 194 50 258 -- Vermont........................................... 1,702 1,224 47 89 10 433 -- 253 16 -- 80 -- Virginia Islands.................................. 146 16 1 39 19 62 5 28 9 26 22 23 Virginia.......................................... 8,218 7,196 9 513 83 1,913 -- 23 133 62 9 -- Washington........................................ 28,444 16,247 58 776 379 9,610 5,659 2,603 536 551 1,144 332 West Virginia..................................... 4,756 1,140 123 2,665 108 568 372 179 56 12 73 8 Wisconsin......................................... 7,473 2,649 25 4,915 4 2,760 703 7 1,226 -- -- -- Wyoming........................................... 242 79 5 91 1 98 2 65 2 -- 5 -- --------------------------------------------------------------------------------------------------------------------------------------------- Total......................................... 699,573 490,837 6,323 83,376 3,905 87,371 28,478 52,883 5,172 5,024 16,334 1,598 ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ \1\ Excludes waiver operations. Source: Table prepared by the Congressional Research Service based on data in U.S. Department of Health and Human Services (1999, table 3:5). TABLE 7-24.--TANF WORK PARTICIPANTS \1\ FOR TWO-PARENT FAMILY CATEGORY BY WORK ACTIVITY, FISCAL YEAR 1998 ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ Average monthly number of persons engaged in work by work activity Number of ------------------------------------------------------------------------------------------------------------------------------ State participating On-the- Job Education Satisfactory Providing families Unsubsidized Subsidized Work job Job Community Vocational skills related to school child employment employment experience training search service education training employment attendance care ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ Alabama........................................... -- -- -- -- -- -- -- -- -- -- -- -- Alaska............................................ 525 555 -- 15 2 197 100 107 -- -- 5 -- Arizona........................................... 211 291 -- 52 -- 110 9 12 1 2 4 -- Arkansas.......................................... 23 14 -- 4 5 9 1 9 1 -- -- -- California........................................ 29,597 38,452 706 244 109 1,495 47 445 36 906 141 7 Colorado.......................................... 184 181 13 19 -- 59 4 75 -- -- 6 -- Connecticut....................................... 1,603 1,835 -- 332 -- 438 -- 260 -- 10 28 -- Delaware.......................................... 13 15 -- -- -- 2 -- -- -- -- -- -- District of Columbia.............................. 38 51 12 1 1 7 -- 1 1 -- -- -- Florida........................................... -- -- -- -- -- -- -- -- -- -- -- -- Georgia........................................... -- -- -- -- -- -- -- -- -- -- -- -- Guam.............................................. 18 12 -- -- -- -- 15 -- -- -- -- -- Hawaii............................................ -- -- -- -- -- -- -- -- -- -- -- -- Idaho............................................. 31 18 1 1 -- 18 -- 35 -- -- -- Illinois.......................................... 3,937 3,756 4 1,039 -- 480 80 151 7 -- 89 -- Indiana........................................... 280 372 -- 4 1 25 -- 3 4 5 5 -- Iowa.............................................. 932 1,445 -- 14 -- 38 4 147 -- -- 23 -- Kansas............................................ 218 215 -- 73 -- 178 -- 4 5 18 -- -- Kentucky.......................................... 569 426 -- 348 5 4 9 80 -- -- 4 -- Louisiana......................................... 117 132 -- 34 -- 6 -- 19 -- 1 -- -- Maine............................................. 317 236 -- 10 1 268 118 14 10 -- 24 -- Maryland.......................................... -- -- -- -- -- -- -- -- -- -- -- -- Massachusetts..................................... 397 441 13 -- -- 16 157 -- -- 14 16 3 Michigan.......................................... 3,156 3,989 16 -- 9 487 11 29 -- 27 38 -- Minnesota......................................... 1,320 1,690 -- 8 -- 407 4 81 1 54 95 -- Mississippi....................................... 2 2 -- 1 -- -- 1 1 -- -- -- -- Missouri.......................................... 52 44 3 16 -- 48 -- -- 2 4 -- -- Montana........................................... 685 223 -- 1,059 -- 1,152 2 55 -- -- 19 -- Nebraska.......................................... 257 352 -- 2 -- 195 -- 5 35 -- 71 -- Nevada............................................ 134 169 1 4 -- 36 20 11 2 -- 2 1 New Hampshire..................................... 20 19 -- 5 1 14 -- -- 5 -- 5 -- New Jersey........................................ -- -- -- -- -- -- -- -- -- -- -- -- New Mexico........................................ 399 486 -- 39 -- -- -- -- -- -- -- -- New York.......................................... 5,576 4,196 -- 1,735 -- 297 1,199 171 -- 50 -- -- North Carolina.................................... 188 196 16 6 -- 24 -- 27 -- -- -- -- North Dakota...................................... -- -- -- -- -- -- -- -- -- -- -- -- Ohio.............................................. 3,324 2,732 41 1,784 -- 875 -- 335 -- 29 115 10 Oklahoma.......................................... 18 9 -- 7 -- 8 -- 6 -- -- -- -- Oregon............................................ 137 105 17 12 1 100 -- -- 9 30 11 -- Pennsylvania...................................... 315 421 -- 5 1 86 -- 15 -- -- 1 -- Puerto Rico....................................... -- -- -- -- -- -- -- -- -- -- -- -- Rhode Island...................................... 369 358 8 11 1 118 -- 20 -- 5 2 -- South Carolina.................................... 147 155 -- 2 -- 32 -- 1 2 -- 1 -- South Dakota...................................... -- -- -- -- -- -- -- -- -- -- -- -- Tennessee......................................... 72 46 -- 5 13 27 -- 15 -- -- 13 -- Texas............................................. 764 431 1 218 3 617 -- 24 -- 1 14 -- Utah.............................................. 21 27 -- -- -- 15 -- -- -- -- 2 -- Vermont........................................... 216 236 16 12 3 74 -- 6 2 -- 11 -- Virginia.......................................... 213 255 -- 21 2 105 -- 1 3 7 -- -- Virgin Islands.................................... -- -- -- -- -- -- -- -- -- -- -- -- Washington........................................ 3,693 3,183 -- 236 -- 2,350 1,628 359 -- 274 71 274 West Virginia..................................... 1,032 397 38 625 13 163 90 14 -- 4 28 8 Wisconsin......................................... 86 67 -- 53 -- 48 11 -- 19 -- -- -- Wyoming........................................... 2 1 -- 1 -- 2 -- -- -- -- -- -- --------------------------------------------------------------------------------------------------------------------------------------------- Total......................................... 61,208 68,236 908 8,057 171 10,630 3,510 2,538 145 1,441 844 303 ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ \1\ Excludes waiver operations. Source: Table prepared by the Congressional Research Service based on data in U.S. Department, 1999, table 3:6. training are largely reserved for those who need it to get or keep a job or to advance on a career ladder.'' (Fagnoni, 1999). Work or job preparation activities.--Tables 7-23 and 7-24 provide data on official work participation rates. They show the number of TANF adults who engaged in 1 of 12 work activities listed in the law for the required hours and hence were counted in calculating the State's work participation rate. A broader measure of work and work-related activity is shown in the next two tables; namely, the proportion of adults reported to be engaged in some form of work or job preparation activity at least 1 hour weekly. As table 7-25 shows, by this measure work activity has increased under TANF from that reported under Aid to Families with Dependent Children (AFDC). The percent of AFDC/TANF adults who were employed, engaged in subsidized work, engaged in job search, or engaged in educational activities rose in each category from fiscal year 1994 through fiscal year 1998. Especially sharp gains are shown for rates of actual employment: the unsubsidized employment rate was up 175 percent from 1994 to 1998, and the subsidized employment rate was up 292 percent. Table 7-26 provides this information by State for fiscal year 1998. The categories for reporting activities were different under AFDC than they are under TANF; categories were collapsed to make them as comparable as possible. However, some of the trends might be affected by changes in the way work or job preparation activities were reported. TABLE 7-25.--PERCENT OF AFDC/TANF ADULTS ENGAGED IN WORK OR JOB PREPARATION ACTIVITY, FISCAL YEARS 1994-98 ---------------------------------------------------------------------------------------------------------------- 1994 1995 1996 1997 1998 ---------------------------------------------------------------------------------------------------------------- Some activity...................................................... 19.2 20.4 22.4 24.7 35.3 Unsubsidized employment............................................ 8.3 9.3 11.3 13.3 22.8 Subsidized employment.............................................. 1.4 1.2 1.7 2.4 5.5 Job search......................................................... 4.0 4.1 4.7 5.3 5.1 Education.......................................................... 3.6 3.9 3.5 3.0 5.0 Other \1\.......................................................... 2.7 2.8 2.4 2.3 1.2 ---------------------------------------------------------------------------------------------------------------- \1\ Includes activities that States conduct under pre-TANF waivers from AFDC/JOBS rules. Source: Congressional Research Service tabulations of the fiscal year 1998 Emergency TANF Data Report sample and fiscal year 1994-97 AFDC-QC files. Employment of adult recipients.--Under TANF, there has been a sharp rise in the incidence of welfare and work. In fiscal year 1979, before Congress sharply limited a financial work incentive,\7\ about one in seven AFDC adults reported employment. Thereafter, as shown by chart 7-4, employment rates sank. During the 1980s through 1995, fewer than 1 in 10 AFDC adults worked. But in 1996, when several States began their own reforms under waivers from AFDC rules, the proportion increased to 11.3 percent. And in fiscal year 1998, the first full year of TANF, the share jumped sharply. That year 22.8 percent of all TANF adults were reported to be employed in unsubsidized jobs at least 1 hour weekly. In some States it soared above one-third, or higher (see table 7-26). The employment measures in chart 7-4 differ from official work participation rates of TANF law. To be counted as a TANF work participant in fiscal year 1998, a recipient in fiscal year 1998 had to work an average of 20 hours weekly (more in a two-parent family). In fiscal year 1998, 23.8 percent of TANF adults with unsubsidized jobs averaged fewer than 20 hours weekly of work (7.6 percent, fewer than 10 hours). --------------------------------------------------------------------------- \7\ The work incentive was a requirement that in computing recipients' benefits, States disregard the first $30 earned monthly plus one-third of all remaining earnings, without time limit. The Omnibus Budget Reconciliation Act of 1981 limited the $30 and one-third work reward to the first 4 months of a job, reduced the reward to $30 in months 8-12, and ended it thereafter. Generally, after 4 months, a family's AFDC benefit was reduced dollar-for-dollar for all ``net'' earnings (gross earnings minus a standard work expense allowance and actual child care costs up to statutory maximums) above $30. TABLE 7-26.--PERCENT OF TANF ADULTS ENGAGED IN WORK OR JOB PREPARATION ACTIVITY,\1\ FISCAL YEAR 1998 ---------------------------------------------------------------------------------------------------------------- In at State least one Unsubsidized Subsidized Job Education Other activity employment work search ---------------------------------------------------------------------------------------------------------------- Alabama........................................ 32.8 20.2 3.6 6.5 6.2 0.0 Alaska......................................... 45.3 29.7 4.9 10.6 6.5 0.0 Arizona........................................ 43.7 38.5 4.2 4.5 4.1 0.0 Arkansas....................................... 34.2 8.4 5.0 10.3 10.0 2.1 California..................................... 36.0 28.0 1.6 2.6 3.5 0.7 Colorado....................................... 31.6 16.1 6.3 2.7 10.0 0.0 Connecticut.................................... 54.5 48.9 1.5 4.2 2.7 0.2 Delaware....................................... 26.8 22.3 0.1 6.0 0.1 0.0 District of Columbia........................... 18.8 16.2 3.1 3.0 0.6 0.1 Florida........................................ 40.6 28.5 4.9 2.8 7.3 0.0 Georgia........................................ 30.3 12.0 12.2 3.3 6.9 0.0 Hawaii......................................... 32.1 24.2 7.3 5.5 2.4 0.0 Idaho.......................................... 62.7 17.5 5.2 24.3 18.0 14.7 Illinois....................................... 36.2 26.4 3.5 4.9 3.4 0.1 Indiana........................................ 36.9 33.4 0.8 3.4 2.7 0.0 Iowa........................................... 59.4 52.4 0.9 1.5 11.5 0.0 Kansas......................................... 46.4 25.2 10.0 17.3 5.0 0.0 Kentucky....................................... 32.9 16.2 9.8 0.4 6.5 1.6 Louisiana...................................... 32.3 17.7 8.9 1.7 8.0 0.0 Maine.......................................... 47.4 25.5 8.9 16.0 8.4 0.0 Maryland....................................... 21.8 7.2 3.4 10.6 1.7 0.0 Massachusetts.................................. 35.6 20.8 4.8 1.6 9.6 0.0 Michigan....................................... 49.4 44.4 0.2 5.6 1.2 0.0 Minnesota...................................... 45.8 31.7 0.5 11.0 8.5 2.0 Mississippi.................................... 34.3 18.8 9.7 6.5 4.1 0.8 Missouri....................................... 24.5 7.6 4.4 2.8 5.1 12.4 Montana........................................ 82.9 15.6 38.9 71.3 12.7 0.0 Nebraska....................................... 56.5 25.5 0.7 19.7 10.2 15.9 Nevada......................................... 36.5 22.3 3.5 6.6 5.5 3.4 New Hampshire.................................. 45.3 23.2 1.4 7.9 9.6 14.8 New Jersey..................................... 31.0 10.9 14.7 6.2 5.4 0.0 New Mexico..................................... 16.9 14.7 1.7 0.1 0.7 0.1 New York....................................... 30.6 14.2 12.7 1.7 4.5 0.0 North Carolina................................. 18.5 10.6 2.0 1.1 6.9 0.0 North Dakota................................... 33.8 15.3 11.6 5.9 4.9 0.5 Ohio........................................... 49.1 26.0 14.0 7.2 8.1 6.7 Oklahoma....................................... 41.9 19.1 3.9 9.5 9.3 0.0 Oregon......................................... 54.6 8.5 5.3 13.3 10.1 32.0 Pennsylvania................................... 29.5 22.2 0.1 5.5 2.9 0.3 Rhode Island................................... 34.6 23.5 1.5 2.6 9.6 0.0 South Carolina................................. 44.4 28.3 1.8 9.3 10.7 0.0 South Dakota................................... 48.2 11.6 21.5 8.9 8.7 6.3 Tennessee...................................... 40.6 20.3 5.7 8.0 15.7 0.0 Texas.......................................... 10.2 3.4 0.9 4.2 2.2 2.6 Utah........................................... 53.3 26.4 0.0 25.3 11.5 2.0 Vermont........................................ 43.5 26.8 2.4 10.9 11.5 0.0 Virginia....................................... 31.3 21.6 2.7 11.6 0.8 0.0 Washington..................................... 55.9 27.8 14.9 18.7 8.6 1.0 West Virginia.................................. 30.8 6.9 18.3 3.6 4.4 0.0 Wisconsin...................................... 75.9 23.1 56.1 25.0 14.1 0.0 Wyoming........................................ 46.6 13.8 14.9 21.2 10.6 3.7 Guam........................................... 5.0 2.4 2.6 0.0 0.0 0.0 Puerto Rico.................................... 2.7 1.1 0.0 1.6 0.0 0.0 Virgin Islands................................. 42.9 0.0 12.9 15.7 22.1 2.3 ---------------------------------------------------------------- Total...................................... 35.8 22.8 5.7 5.1 5.0 1.2 ---------------------------------------------------------------------------------------------------------------- \1\ Includes activities that States may conduct under pre-TANF waivers from AFDC/JOBS rules. Source: Table prepared by the Congressional Research Service tabulations of the fiscal year 1998 Emergency TANF Data Report sample. Under TANF, both States and recipients have a greater incentive to report work than they did under AFDC. Most States have increased the reward to recipients' work. Because failure to achieve work participation rates now carries the threat of fiscal penalties, States also have a stronger incentive to report recipients' work. Thus, some of the increase in the reported employment rate may be due to increased reporting. Federal AFDC law stipulated what income had to be counted when determining AFDC eligibility and benefits. For applicants and recipients, the law from 1988 to 1996 set these rules: States were required to deduct both the first $90 monthly of earnings as a standard work expense allowance and actual child care expenses up to statutory maximums of $200 per child under age 2 or $175 per older child. For recipients only, AFDC also had a time-limited work reward, taken after the work expense deduction. The reward was to disregard $30 of earnings plus one-third of remaining earnings for the first 4 months of work and $30 per month for months 5-12 on a job. TANF has no Federal rules about treatment of earnings. More than three-fourths of TANF jurisdictions have raised earnings disregards from those that existed under AFDC. The new disregards permit recipients to keep more of their benefits as their earnings increase. They also permit recipients to stay on TANF at higher earnings levels than AFDC; that is, they raise the exit point from welfare (and the entrance point, unless a State treats the earnings of an applicant less generously than those of a recipient as many do). CHART 7-4. PERCENT OF AFDC/TANF ADULTS EMPLOYED, SELECTED YEARS 1979-98 Source: Chart prepared by the Congressional Research Service, on the basis of data tabulations from the U.S. Department of Health and Human Services studies of characteristics of AFDC families (1979-88), quality control data tapes (1994-97), and the fiscal year 1998 Emergency Temporary TANF Data Report. On average, the fiscal year 1998 employment rate for TANF adults in the 41 States with increased earnings disregards was much higher than in States that retained AFDC earnings disregards. Chart 7-5 shows that in fiscal year 1998, 25.5 percent of TANF adults in the States that raised their earnings disregards were employed. In contrast, 10.8 percent of TANF adults in the 13 jurisdictions that retained AFDC earnings disregards that year were employed. Although average employment rates of TANF adults were higher in the States that liberalized treatment of earnings than in those that did not, there was considerable variation by State. Further, the low group average for States that kept AFDC rules was strongly affected by the 3.9 percent rate in Texas, which has the Nation's fourth largest TANF caseload. Also, although Delaware and Colorado retained AFDC earnings disregards, they also continued to operate ``fill-the-gap'' kinds of programs, which provide another form of work incentive. Under ``fill-the-gap'' programs, recipients are able to use earnings and/or child support payments to fill all or part of the income gap between the amount needed by the family, according to State standards, and the benefit amount actually paid by the State. Therefore, a dollar increase in earnings does not necessarily mean a dollar decrease in benefits in fill-the-gap States. CHART 7-5. EMPLOYMENT RATES FOR TANF ADULTS IN STATES THAT RAISED EARNINGS DISREGARDS AND THOSE THAT DID NOT, FISCAL YEAR 1998 Source: Congressional Research Service tabulations of the fiscal year 1998 Emergency TANF Data Report sample and July 1998 CRS Survey of States regarding TANF financial eligibility and benefit rules. Average AFDC/TANF benefits and earnings From fiscal year 1994 through fiscal year 1997, as the employment rate increased, average earnings also increased slightly, as shown in chart 7-6. However, declines in the average cash AFDC benefit offset those earnings increases so that the total (cash benefit plus earnings) remained relatively flat over these years. In fiscal year 1998, earnings jumped, as did the employment rate, and national average cash benefits also rose slightly, even though, as table 7-6 showed, average benefits in most States declined. Over the 4-year period, average benefits plus average earnings (including zero earnings for nonworkers) rose by 15 percent, from $354 to $406. The increase in earnings and benefits could be at least partially explained by changes in State treatment of earnings. As noted before, under AFDC benefits generally were reduced one dollar for each one dollar of extra earnings after a short period of work. By contrast, under TANF most States permit recipients to keep more of their benefits as earnings increase. The TANF Data Report provides no information about an important source of potential income for parents who combine TANF with earnings; namely, the earned income credit (EIC). In calendar year 1998, a family with one child could earn an EIC of up to $2,271; a family with two or more children could earn a credit of up to $3,756. Further, according to the U.S. Department of Health and Human Services (DHHS), Medicaid and food stamps were received in fiscal year 1998 by 98.1 percent and 83.5 percent of TANF families, respectively (U.S. Department, 1999, table 9:8, p. 85). CHART 7-6. AVERAGE MONTHLY AFDC/TANF BENEFIT AND EARNINGS, FISCAL YEARS 1994-98 Source: Congressional Research Service tabulations of the fiscal year 1998 Emergency TANF Data Report file and the fiscal year 1994-97 (first three quarters) AFDC-QC data file. Data are missing for California and Minnesota. CHARACTERISTICS OF AFDC/TANF FAMILIES Composition of Families, 1969-98 Since 1969, the proportion of welfare families with no adult recipient (child-only families) has more than doubled to 24 percent, and the average size of families has declined to 2.8 persons. Between 1969 and 1996, the latest year with available data, the proportion of AFDC/TANF families who live with nonrecipients increased from one-third to one-half (see table 7-27). The share of AFDC/TANF recipients who are teenage parents dropped from 2.4 percent in 1994 to 1.6 percent in 1998. The fiscal year 1998 column of the table shows circumstances in the first full year of TANF; the fiscal year 1994 column shows circumstances when AFDC was at its historic peak. In this 4-year period, average family size did not change, the share of no-adult families rose sharply (while the share with single parents or two parents declined), and the share whose youngest child was 6 or older increased. The increase from 1994 in the share of TANF families that were child-only is not the result of an increase in the number of child-only families. The number of child-only families increased rapidly in the early 1990s (Blank, 1998), but the increase in the number leveled off in the mid-1990s, and in fiscal year 1998 was below the number of child-only families in fiscal year 1994. How- TABLE 7-27.--COMPOSITION OF AFDC/TANF FAMILIES, SELECTED YEARS, 1969-98 \1\ ---------------------------------------------------------------------------------------------------------------- Fiscal Fiscal Fiscal Fiscal May March year year year year 1969 1979 1988 1994 1996 1998 ---------------------------------------------------------------------------------------------------------------- Number of family members Average number of family members...................... 4.0 3.0 3.0 2.8 2.8 2.8 Number of adult recipients (percent of all AFDC/TANF families) \1\ One adult............................................. 78.4 78.9 81.2 74.4 70.7 68.7 Two adults or more.................................... 11.9 6.2 9.2 8.3 7.7 7.3 No adults............................................. 9.6 14.9 9.6 17.3 21.5 24.0 Number of child recipients (percent of all AFDC/TANF families \2\ One child............................................. 26.7 42.5 43.2 44.8 45.9 44.0 Two children.......................................... 23.1 28.0 30.7 30.0 29.9 29.7 Three children........................................ 17.6 15.5 16.1 15.6 15.0 15.7 Four children or more................................. 32.6 13.9 10.7 9.6 9.2 10.6 Age of youngest child (percent of all AFDC/TANF families) Less than 6 years old................................. NA 56.5 60.6 62.7 60.0 57.3 6 years old and older................................. NA 43.5 39.4 37.3 39.0 42.7 Average age of adult recipients........................... \3\ 33. \3\ 28. \3\ 27 30.8 31.1 31.3 1 7 Teen parents (percent of all AFDC/TANF recipients)........ NA 2.2 2.2 2.4 1.9 1.6 Percent of AFDC/TANF families in households with 33.1 40.2 36.8 \4\ 46 \4\ 50 NA nonrecipients............................................ .4 ---------------------------------------------------------------------------------------------------------------- \1\ The 1984-88 tabulations exclude Utah, West Virginia, Wisconsin, Puerto Rico and the Virgin Islands because the U.S. Department of Health and Human Services concluded that 1998 data on no-adult families for these States were unreliable. \2\ Rhode Island was excluded from 1994-98 tabulations of the percentage of families with a given number of child recipients because 1998 data were found unreliable. \3\ Median age of mothers. \4\ This item is from the U.S. Department of Health and Human Services series of studies on characteristics of AFDC families (U.S. Department, 1970, 1982, undated). NA--Not available. Note.--Data for 1969 are for May; data for 1979 are for March; the other columns are average monthly data for fiscal years. Source: Table prepared by the Congressional Research Service based on data from the U.S. Department of Health and Human Services. For 1969, 1979, and 1988, data are from the U.S. Department of Health and Human Services Series of Studies, Characteristics and Financial Circumstances of AFDC Families. Congressional Research Service tabulations of these data exclude ``unknowns.'' Unless otherwise indicated, for 1994, 1996, and 1998, data are from Congressional Research Service tabulations of the 1998 Emergency TANF Data Report sample and the AFDC-QC data file. ever, as the caseload declined, the number of child-only families fell at a lower rate than the number of families with an adult. Table 7-27 shows that the share of AFDC/Temporary Assistance for Needy Families (TANF) families with two or more adults, 7.3 percent in fiscal year 1998, was below the 8.3 percent rate of fiscal year 1994. Under AFDC, a two-parent family could be served only if the second parent was disabled or was unemployed (defined as working fewer than 100 hours monthly) and had a work history. TANF ended those rules, and many States have used their new discretion to base two-parent eligibility on income, a change that increased potential caseloads. However, the reported trend in two-adult TANF families is affected by State decisions to place these families in separate State programs (SSPs) rather than TANF. By the start of fiscal year 2000, according to a DHHS official, the number of States that served two-parent families in SSPs had more than doubled from 6 in fiscal year 1998 to 13. As noted earlier, several States were penalized in fiscal years 1997 and 1998 for failure to meet work participation rates for two- parent families in the regular TANF Program. Marital Status of Parents In fiscal year 1996, the last full year of AFDC, the marital status of their parents was known for about 8.5 million recipient children (data were missing or unclear for about 0.2 million other children). In all, 5.1 million children, 60.4 percent of the children with parental marital data, were living with a single parent who had not married the second parent; 2.2 million (25.1 percent) were with a parent who was divorced or separated. Another 1.1 million (12.9 percent) were in two- parent families and presumed married; finally, 140,000 children (1.6 percent) were living with a widowed parent (data from U.S. Department of Health and Human Services, Characteristics and Financial Circumstances of AFDC Families, Fiscal Year 1996). The Emergency TANF Data Report for fiscal year 1998 covered 6 million TANF children. Congressional Research Service (CRS) tabulations about the marital status of parents, however, exclude 0.6 million children from seven jurisdictions (Colorado, Georgia, Guam, North Carolina, Oregon, Rhode Island, and Texas). Moreover, for about 1 million children, data about the marital status of parents were missing or unknown. Thus, relevant data were available for 4.4 million children. Tabulations show that the parents of 2.6 million children (57.6 percent of the children with available data) were never married; 1.4 million (31.7 percent) married; 0.4 million (9.9 percent) divorced; and 0.04 million (0.8 percent) widowed. Race and Ethnicity of AFDC/TANF Adults The majority of TANF adults are nonwhite (table 7-28). In fiscal year 1998, non-Hispanic whites accounted for slightly more than one in three TANF adults (35.8 percent). Nonwhites accounted for close to two-thirds of adults on TANF as follows: Non-Hispanic blacks, 37.3 percent; Hispanics, 20.1 percent; Native American/Alaska Natives, 1.6 percent; Asian/Oriental Pacific Islanders, 4.6 percent; and adults of other racial/ ethnic groups, 0.6 percent. Over the fiscal year 1994-98 period, nonwhites have increased as a percent of all TANF adults. In fiscal year 1994, non-Hispanic whites represented an estimated 40 percent of the AFDC caseload, but only an estimated 36 percent of the fiscal year 1998 TANF caseload. Non-Hispanic blacks grew as a share of the caseload every year except 1996 and increased their share over the period by 8 percent. Hispanics also grew as a share of the caseload until fiscal year 1998. Table 7-28 shows the trend in the racial/ethnic makeup of the national caseload from fiscal year 1994 to fiscal year 1998. Table 7-29 presents State-by-State data on the percentage of nonwhite AFDC/TANF adults over the same period. TABLE 7-28.--RACIAL/ETHNIC COMPOSITION OF AFDC/TANF ADULTS, FISCAL YEARS 1994-98 [In percent] ------------------------------------------------------------------------ 1994 1995 1996 1997 1998 ------------------------------------------------------------------------ Non-Hispanic white.............. 41.4 39.4 39.7 37.5 35.8 Non-Hispanic black.............. 34.5 35.2 34.5 35.2 37.3 Hispanic........................ 19.1 20.1 20.3 22.2 20.1 Asian/Oriental Pacific Islander. 3.8 4 4.1 4 4.6 Native American................. 1.3 1.3 1.4 1.1 1.6 Other........................... NR NR NR NR 0.6 ------------------------------------------------------------------------ NR--Data not reported. Source: Congressional Research Service tabulations of the fiscal year 1998 Emergency TANF Data Report sample. TABLE 7-29.--PERCENTAGE OF AFDC/TANF ADULTS WHO ARE NONWHITE,\1\ FISCAL YEARS 1994-98 ---------------------------------------------------------------------------------------------------------------- State 1994 1995 1996 1997 1998 ---------------------------------------------------------------------------------------------------------------- Alabama............................................................ 74.5 74.7 70.8 70.7 75.1 Alaska............................................................. 50.8 52.0 52.1 0.0 55.5 Arizona............................................................ 55.9 59.8 58.4 63.5 64.4 Arkansas........................................................... 54.3 54.2 52.9 51.4 69.3 California......................................................... 68.8 68.9 62.1 69.3 67.7 Colorado........................................................... 55.5 54.7 55.9 65.9 56.1 Connecticut........................................................ 65.4 68.0 67.2 69.2 68.3 Delaware........................................................... 67.5 68.9 70.1 64.3 70.2 District of Columbia............................................... 98.9 98.8 99.2 99.5 99.6 Florida............................................................ 60.2 65.1 62.9 67.8 74.6 Georgia............................................................ 75.9 74.3 72.8 77.5 81.3 Guam............................................................... 96.2 96.9 97.9 98.8 97.3 Hawaii............................................................. 73.7 76.8 75.1 82.4 82.1 Idaho.............................................................. 15.8 17.5 12.9 12.0 12.3 Illinois........................................................... 65.3 65.7 68.3 68.8 73.0 Indiana............................................................ 36.7 40.8 43.0 39.9 41.7 Iowa............................................................... 14.2 14.3 16.3 12.9 16.2 Kansas............................................................. 31.9 33.8 34.2 28.9 37.7 Kentucky........................................................... 19.1 16.8 19.4 21.2 20.9 Louisiana.......................................................... 80.0 81.3 80.3 82.2 84.4 Maine.............................................................. 4.2 2.7 2.2 2.8 4.5 Maryland........................................................... 73.6 71.4 76.1 78.6 80.4 Massachusetts...................................................... 47.4 54.3 50.3 52.4 53.7 Michigan........................................................... 50.2 53.2 52.1 56.7 53.8 Minnesota.......................................................... 36.3 40.5 42.3 44.4 48.1 Mississippi........................................................ 82.9 81.5 86.5 84.3 86.3 Missouri........................................................... 41.7 43.7 47.4 50.0 52.6 Montana............................................................ 29.1 31.3 37.4 39.3 48.9 Nebraska........................................................... 33.4 32.3 36.3 40.4 41.2 Nevada............................................................. 38.8 39.2 39.6 39.2 47.3 New Hampshire...................................................... 1.4 3.5 3.3 3.7 6.2 New Jersey......................................................... 76.3 79.2 80.6 77.1 85.2 New Mexico......................................................... 75.3 78.2 73.6 74.5 75.6 New York........................................................... 71.8 73.4 76.3 72.7 77.5 North Carolina..................................................... 60.7 65.2 65.9 68.0 69.8 North Dakota....................................................... 40.7 39.9 43.3 52.5 57.7 Ohio............................................................... 38.3 42.6 43.5 40.7 49.6 Oklahoma........................................................... 43.4 40.8 42.7 46.3 49.7 Oregon............................................................. 17.0 16.3 16.6 21.4 18.7 Pennsylvania....................................................... 50.6 53.2 53.7 57.1 60.9 Puerto Rico........................................................ 99.9 100.0 99.9 100.0 100.0 Rhode Island....................................................... 39.1 39.2 42.9 50.5 45.0 South Carolina..................................................... 72.7 73.2 71.3 76.3 74.6 South Dakota....................................................... 55.1 56.5 54.4 63.7 74.6 Tennessee.......................................................... 49.3 50.9 55.1 54.5 66.5 Texas.............................................................. 76.0 77.8 78.7 78.5 80.6 Utah............................................................... 24.0 20.0 22.4 22.4 27.4 Vermont............................................................ 0.9 4.5 2.5 0.5 2.3 Virginia........................................................... 67.0 66.6 66.4 60.6 62.6 Virgin Islands..................................................... 100.0 98.3 100.0 97.7 98.2 Washington......................................................... 26.3 27.5 27.0 26.5 32.6 West Virginia...................................................... 6.2 6.8 8.3 4.9 6.7 Wisconsin.......................................................... 52.4 53.6 58.4 67.6 83.0 Wyoming............................................................ 20.5 24.1 26.8 27.1 47.4 -------------------------------------------- Total.......................................................... 58.6 60.6 60.3 62.5 64.2 ---------------------------------------------------------------------------------------------------------------- \1\ Defined in this table to include non-Hispanic Blacks, Hispanics, Asian/Oriental Pacific Islanders, and Native Americans. Source: Table prepared by the Congressional Research Service based on fiscal year 1994-97 AFDC-QC files and tabulations of the fiscal year 1998 Emergency TANF Data Report sample. Educational Attainment of TANF Adults Tabulations of the March 1999 Current Population Survey show that TANF adults tend to have below-average schooling. In fiscal year 1998, 47 percent of TANF adults did not have at least 12 years of school or an educational credential. This compares with 15 percent of the total U.S. population aged 25- 64 without a high school degree in 1997. It is not possible to compare the educational attainment of TANF adults with those of AFDC adults because data are lacking. For fiscal years 1992-96, DHHS did not publish tables about adult years of education because the information was unknown for a high percentage of cases (``unknowns'' accounted for 50 percent of the adults in 1991, the last year with published data). Living Arrangements of TANF Children Tabulations of the AFDC Quality Control data file by CRS show that in fiscal year 1994, about 1.5 million out of 9.8 million AFDC children lived in families with no adult recipient (``child-only'' families). By law, their adult caretakers had to be relatives, but it is not known whether they were parents, grandparents, aunts, or other relatives. It is presumed that most were themselves ineligible for AFDC because they were recipients of SSI, illegal aliens, or nonneedy persons, for instance. However, some may have chosen not to join welfare, even though eligible. The proportion of welfare children living in families with no adult recipient climbed from 15 percent in fiscal year 1994 to 20.8 percent in fiscal year 1998 (Emergency TANF data report sample file), and the share of child-only AFDC/TANF families made a corresponding increase, from 17.3 percent in 1994 to 24 percent in 1998 (table 7-27). More than 7 out of 10 children (71.8 percent) lived with a single parent in 1998, and fewer than one in 10 (7.4 percent) lived with two parents. Analysis of the Emergency TANF Data Report sample file for fiscal year 1998 provides information about family relationships. Table 7-30 shows that of children in families without an adult recipient 63 percent were in their parent's household, 24.3 percent were with a grandparent, 9.7 percent were in the household of another relative, and 3.1 percent were with a stepparent or an unrelated household head. Among all family types, 90.3 percent of TABLE 7-30.--CHILD'S RELATIONSHIP TO HEAD OF HOUSEHOLD BY FAMILY TYPE, FISCAL YEAR 1998 [In percent] ---------------------------------------------------------------------------------------------------------------- Family type --------------------------------------------------- Child's relationship to family head Single- All parent Two-parent Child-only families ---------------------------------------------------------------------------------------------------------------- Child....................................................... 97.4 98.8 63.0 90.3 Grandchild.................................................. 1.6 0.4 24.3 6.2 Other related............................................... 0.6 0.3 9.7 2.5 Stepchild or unrelated child................................ 0.5 0.6 3.1 1.0 ---------------------------------------------------------------------------------------------------------------- Note.--Excludes data for Puerto Rico, Rhode Island, Texas, Utah, the Virgin Islands, West Virginia, and Wisconsin. Source: Congressional Research Service tabulations of the fiscal year 1998 Emergency TANF Data Report sample file. TANF children lived with a parent, 6.2 percent with a grandparent, 2.5 percent with another relative, and 1.0 percent were with a stepparent or an unrelated household head. WELFARE-TO-WORK (WTW) GRANT PROGRAM The Balanced Budget Act of 1997 (Public Law 105-33) created a 2-year $3 billion WTW Grant Program to serve hard-to-employ welfare recipients and noncustodial parents. After set-asides, 75 percent of WTW funds were designated for matching formula grants and 25 percent for competitive grants. For fiscal years 1998 and 1999, available formula grants totaled $2.135 billion and competitive grants $712 million. States and localities have 3 years from the award date in which to spend the funds. The original law set aside $100 million for performance bonuses, $30 million for Indian tribal grants, and $24 million for evaluations. Public Law 106-113 reduced the performance bonus amount to $50 million. Although WTW is a component of TANF (Sec. 403(a)(5) of the Social Security Act), it is administered by the U.S. Department of Labor (DOL) and not DHHS. Formula grants were allocated by DOL to States on the basis of their shares of the national adult TANF population and the poverty population. States are required to distribute 85 percent of the formula grants to local work force investment areas; at least half of the State's substate allocation formula must be based on the ``high poverty'' population \8\ of the work force investment area and the rest on its population of long-term welfare recipients and/ or unemployed persons. Competitive grants were awarded directly to local work force investment boards, other local government entities, and private entities that applied in conjunction with one of the former. --------------------------------------------------------------------------- \8\ Defined as the number of persons in poverty in excess of 7.5 percent of the area's total population. --------------------------------------------------------------------------- WTW funds are focused on hard-to-employ TANF recipients. As originally enacted, at least 70 percent of funds had to be used for the benefit of TANF recipients (and noncustodial parents) with at least two specified barriers to work who themselves (or whose minor children) were long-term recipients (30 months of AFDC/TANF benefits) or were within 12 months of reaching the 5- year limit on federally funded TANF or a shorter State time limit. The target groups had to have at least two of these three work impediments: (1) lack a high school diploma and have low skills in reading or mathematics; (2) require substance abuse treatment for employment; or (3) have a poor work history. Remaining funds (up to 30 percent) had to be used for persons having characteristics associated with long-term welfare use. WTW eligibility was liberalized by Public Law 106- 113. Effective July 1, 2000, States may use WTW formula grant allotments and State matching funds on behalf of four new groups: (1) long-term TANF recipients without specified work barriers; (2) former foster care youths 18-24 years old; (3) TANF recipients who are determined by criteria of the local work force investment board to have significant barriers to self-sufficiency; and (4) non-TANF custodial parents with income below the poverty line. Not more than 30 percent of the funds may be used for the three latter new groups. The revised law also changed rules for noncustodial parents. Eligible under the new rules, provided they comply with an oral or written personal responsibility contract, are noncustodial parents who are unemployed, underemployed, or having difficulty paying child support if their minor children are eligible for or receive TANF benefits (with priority for those whose children are long-term recipients), received TANF during the preceding year, or are eligible for or receive certain other income- tested benefits. The expanded eligibility rules took effect on January 1, 2000, for competitive grants. Federal expenditures from formula grants for the newly eligible groups may not be made until October 1, 2000, even though obligations may be incurred for them beginning July 1, 2000. Activities that may receive WTW funds are the conduct and administration of community service or work experience programs; job creation through wage subsidies; on-the-job training; contracts with providers of readiness, placement, and postemployment services; job vouchers for placement, readiness, and postemployment services; job retention or support services if these services are not otherwise available; and, added by Public Law 106-113, up to 6 months of vocational education or job training (however, vocational education or job training does not become an allowable formula grant activity until July 1, 2000). As of September 30, 1999, $1.969 billion had been awarded to States in WTW formula grants for fiscal years 1998 and 1999, but States reported spending only $220 million of these funds (table 7-31). The table shows that six States did not participate in either year (Idaho, Mississippi, Ohio, South Dakota, Utah, and Wyoming) and that another three States (Arizona, Delaware, and North Dakota) did not participate in fiscal year 1999. Any funds not awarded to States revert to the Federal Treasury (Public Law 105-277). Over the 2 years, a cumulative total of 85,396 persons participated in the formula grant program. Two States, Pennsylvania and Oregon, accounted for 19 percent of all WTW formula grant participants, although their TANF caseloads represented only 5 percent of the national total. By the end of fiscal year 1999, all available competitive grant funds ($712 million) had been awarded to 189 entities. Competitive grant expenditures to that date totaled $76.3 million and more than 23,000 persons had been served. The two most popular work activities planned by successful bidders for competitive grants were skills training (including on-the-job training) and job placement; job creation was least often mentioned. Child care, substance abuse treatment, and transportation services were about equally popular among supportive services (Devere, 2000). TABLE 7-31.--WELFARE-TO-WORK EXPENDITURES, FISCAL YEARS 1998 AND 1999 [In thousands of dollars] -------------------------------------------------------------------------------------------------------------------------------------------------------- Expenditures in fiscal Expenditures in fiscal Fiscal Fiscal year 1998 year 1999 year 1998 year 1999 -------------------------------------------------------- State grant grant State State Participants allotments allotments Federal (match) Federal (match) expenditures expenditures expenditures expenditures -------------------------------------------------------------------------------------------------------------------------------------------------------- Alabama................................................. $13,978 $13,017 0 $19 $153 $89 313 Alaska.................................................. 2,927 2,709 0 0 1,120 862 2,328 Arizona \1\............................................. 9,000 NP 0 0 556 276 238 Arkansas................................................ 8,490 7,932 $324 0 4,248 4,245 1,174 California \2\.......................................... 190,417 177,228 998 0 39,464 3,723 7,359 Colorado................................................ 9,879 9,214 2 0 843 6,412 342 Connecticut \1\......................................... 12,006 11,184 0 0 5,637 5,475 4,454 Delaware................................................ 2,762 NP 0 0 31 0 84 District of Columbia.................................... 4,646 4,327 0 0 173 0 43 Florida................................................. 50,757 47,414 0 0 1,774 0 1,173 Georgia................................................. 28,409 26,489 827 0 10,413 0 5,072 Guam.................................................... 585 546 0 0 122 0 118 Hawaii.................................................. 5,086 4,719 44 1,702 1,511 1,056 411 Idaho................................................... NP NP 0 0 0 0 0 Illinois \2\............................................ 48,663 45,324 4,332 4,247 18,612 42,746 6,985 Indiana................................................. 14,552 13,578 131 0 2,411 1,300 670 Iowa.................................................... 8,332 7,779 103 87 3,352 1,110 556 Kansas.................................................. 6,668 6,202 50 21 2,780 751 920 Kentucky................................................ 17,723 16,521 108 0 2,748 1,842 1,791 Louisiana............................................... 23,707 22,113 1,126 128 9,322 4,319 3,403 Maine................................................... 5,156 4,804 35 18 1,062 811 393 Maryland................................................ 14,941 13,915 1 19 1,178 681 285 Massachusetts........................................... 20,692 19,260 1,223 0 9,620 9,255 3,038 Michigan................................................ 42,226 39,345 0 0 0 0 0 Minnesota \2\........................................... 14,503 13,537 443 46 7,444 1,966 3,742 Mississippi............................................. NP NP 0 0 0 0 0 Missouri \2\............................................ 19,767 18,432 872 436 9,961 4,980 3,296 Montana \2\............................................. 3,194 2,975 255 129 2,697 1,706 476 Nebraska \2\............................................ 4,022 3,763 518 259 1,824 877 938 Nevada.................................................. 3,384 3,174 43 291 494 1,139 194 New Hampshire........................................... 2,762 2,574 0 0 203 32 76 New Jersey \1\.......................................... 23,527 21,709 0 0 2,133 0 1,197 New Mexico.............................................. 9,716 9,059 108 0 440 0 197 New York................................................ 96,886 90,324 0 0 4,522 1,208 1,570 North Carolina.......................................... 25,332 23,634 54 0 6,903 0 1,500 North Dakota............................................ 2,762 NP 0 37 219 1,174 497 Ohio.................................................... NP NP 0 0 0 0 0 Oklahoma................................................ 11,742 10,920 119 0 3,647 211 779 Oregon.................................................. 8,637 8,084 0 0 4,194 10,878 7,402 Pennsylvania............................................ 44,296 41,358 0 462 6,965 14,877 8,777 Puerto Rico \1\......................................... 34,566 32,219 0 0 7,398 1,583 1,537 Rhode Island............................................ 4,420 4,109 13 0 615 0 271 South Carolina \2\...................................... 12,006 11,107 2,068 999 5,195 2,341 2,803 South Dakota............................................ NP NP 0 0 0 0 0 Tennessee............................................... 21,644 20,215 517 277 3,526 1,556 1,863 Texas................................................... 76,059 70,934 0 0 7,409 0 1,038 Utah.................................................... NP NP 0 0 0 0 0 Vermont................................................. 2,762 2,574 0 25 937 420 412 Virginia................................................ 16,549 15,404 5 0 2,599 103 921 Virgin Islands \1\...................................... 554 515 0 0 121 33 84 Washington.............................................. 22,675 21,143 0 0 4,194 6,370 2,624 West Virginia \1\....................................... 9,805 9,143 0 0 4,108 2,640 1,628 Wisconsin............................................... 12,886 12,032 2 0 1,682 577 424 Wyoming................................................. NP NP 0 0 0 0 0 ----------------------------------------------------------------------------------------------- Total............................................... 1,026,058 942,560 14,320 9,202 205,732 139,626 85,396 -------------------------------------------------------------------------------------------------------------------------------------------------------- \1\ State did not report any data for fiscal year 1998. \2\ These States are currently expending fiscal year 1998 and 1998 grant funds. Therefore, the expenditures for fiscal year 1999 reflect expenditures from fiscal year 1998 and 1999 grant funds. NP--Not participating. Note.--Reflects data current as of January 27, 2000. Source: Table prepared by the Congressional Research Service based on data from the U.S. Department of Labor. Data from DOL show that expenditures from formula grants for the more disadvantaged group (long-term welfare recipients with at least two of three specified work impediments) averaged $3,627 per participant in the last quarter of fiscal year 1999, more than double the average expenditures of $1,578 for other participants, those with characteristics associated with long- term welfare enrollment. In the case of competitive grants, however, there was only a small difference in expenditures between the two groups ($3,191 compared with $2,806). Public Law 106-113 repealed the original WTW reporting provisions, which required specified data about participating families, and substituted a requirement that the Secretary of Labor, in consultation with the DHHS Secretary and others, establish data collection and reporting rules. WELFARE DYNAMICS Duration Findings Concern about long-term use of Aid to Families with Dependent Children (AFDC) was one of the reasons that Congress ended the program, named the replacement program Temporary Assistance for Needy Families (TANF), and barred States from using TANF grants to pay unending benefits to a family. Studies of families' use of AFDC (Ellwood & Bane, 1985; Pavetti, 1995) had shown: --New enrollees could be expected to spend an average of 6 years, including repeat spells, on AFDC. --For families on AFDC at any given time, the average expected length of AFDC receipt, counting repeat spells, was 13 years. --Almost half of recipients on the rolls at a given time had received benefits, counting repeat spells, for more than 5 years. --Most episodes of AFDC enrollment were found to end within 12 months, but most families who exited AFDC came back within 24 months. --Durations on AFDC were above average for never-married parents, nonwhites, those with a child under 1, high school dropouts, and those without recent work experience. Final data for AFDC show that the median number of months of a family's most recent spell on the program rose from 24 months in fiscal year 1996 to 26 months in fiscal year 1997. Further, the number of families continuously on the rolls for 60 months or more climbed from 935,460 in fiscal year 1994 to 1,019,175 in fiscal year 1996.\9\ In the same period the overall caseload declined by 10 percent, in part because fewer new families joined the rolls. More specifically, the number of new AFDC/TANF families fell from 293,510 in fiscal year 1994 to 254,745 in fiscal year 1995, 240,731 in fiscal year 1996, and 186,125 in fiscal year 1997. --------------------------------------------------------------------------- \9\ In fiscal year 1997 (AFDC/TANF transition year) the number of families continuously enrolled for at least 30 months declined to 957,731. --------------------------------------------------------------------------- Experience with TANF is too short, and data too limited, to tell whether duration of welfare spells is changing. The available data for fiscal year 1998 show a family's total time on the TANF Program only since the program began in a State and not time previously spent on AFDC. Exits and Returns to AFDC/TANF Movement on and off the AFDC rolls was frequent. Based on monthly caseload data, work exits from AFDC generally accounted for slightly less than half of all exits within a 5-year period, and many who left returned to the rolls very quickly. Within 1 year of their exit, 45 percent of ex-recipients returned to the program; within 2 years, 58 percent; within 4 years, 69 percent. Those who left AFDC because of employment remained off the program somewhat longer than those who left for other reasons (Committee, 1998, pp. 532-35). A study using 1979-93 data from the National Longitudinal Survey of Youth concluded that, after adjusting for other attributes of the parent and family, the likelihood of leaving AFDC for at least 2 years decreased with the length of time that women received benefits (Sandefur, 1998). Several recent State studies indicate that the percentage of returnees to welfare has dropped significantly under TANF (even before time limits would prevent their return). Table 7- 32 shows the share of leavers in a number of States who were back on the program 12 months after their exit. In some of the studies, the calculations cover all leavers, in others, only those who were off TANF for at least 1 month or for at least 2 months (families sometimes regarded as ``churners''). Counting all leavers, the share back on TANF 1 year after exit ranged from 18 percent in Kansas to 24 percent in Maryland and Colorado. In studies that included only families who were off TANF for at least 1 or 2 months, the return rate at 1 year ranged from 6.5 percent (two-parent families in San Mateo, California) and 13 percent (single-parent families in Georgia) to 21 percent (Massachusetts). Also, when 30-day ``churners'' were omitted from Maryland calculations, the TANF return rate at 1 year dropped from 24 percent to 18 percent. The Maryland study concluded: ``Given Federal time limits, preventing returns to welfare among those who have exited is of tremendous importance.'' (University of Maryland, 1999). The San Mateo, California, study cited in table 7-32 also examined circumstances of applicant families who were ``informally diverted'' from TANF between July 1997 and September 1998. It found that 10.3 percent of one-parent families and 7.1 percent of two-parent families received TANF 1 year after they were denied aid. Larger proportions, 24.3 percent and 14.2 percent, respectively, received TANF at some time during the year. Meyer and Cancian (1996), in a study based on 14 years of data from the National Longitudinal Survey of Youth, analyzed the poverty status of women in the 5 years after their first observed exit from AFDC. They found that more than half (55 percent) of former recipients were poor 1 year after first departing from AFDC; about 40 percent were poor after 5 years. More than one-fifth (22 percent) were never poor in the first 5 years. The researchers said that in each of the 5 years, about 60 percent of the women had earnings and 40 percent had income from a spouse or partner. AFDC was received by 30-40 percent of the women each year; child support or alimony by 17-19 percent. TABLE 7-32.--RETURNS TO TANF WITHIN 1 YEAR OF EXIT -------------------------------------------------------------------------------------------------------------------------------------------------------- Family categories in Percent back on TANF State program Study Time of TANF exit study Leavers included 1 year after exit -------------------------------------------------------------------------------------------------------------------------------------------------------- California CALWORKS (Mancuso & Examining Fourth quarter of 1996 All (one- and two- Includes only cases 14.1 percent (one- Moses, 1999). circumstances of parent families off TANF for at parent cases). 6.5 leavers. separately examined). least 2 months. percent (two-parent cases) Colorado Works (London & Valvano, Postprogram employment July-Sept. 1997....... Adult cases.......... All included......... 23.8 percent 1999). and earnings for Colorado Works closed cases. Georgia TANF (Foster, 1999)........ Amended quarterly 1997.................. Single-adult cases... Includes only cases 13.2 percent progress report. off TANF for at least two straight months. Kansas Temporary Assistance to Statistical summary of Dec. 1997-Nov. 1998... All.................. All.................. 18 percent Families (TAF) (Department of leaver survey. Social, 1999). Maryland TANF (School of Social Life after welfare: October 1996-March All.................. All \1\.............. 24.2 percent Work, 1999). third interim report. 1998. Massachusetts Transitional Aid to How are they doing? Dec.15, 1996-June 14, All.................. Includes only cases 20.9 percent Families with Dependent Children (Round four) 1997. off TANF for at (TAFDC; Department of Longitudinal study. least 30 days. Transitional, 1999). New York Family Assistance (FA; A study of work and January-March 1997.... Excludes child-only Includes only cases 19 percent Rockefeller Institute, 1999). benefit use after cases, adults off TANF for at case closing. without identifiable least 2 months. Social Security numbers and cases closed when families moved out of State. Washington Work First (Ahn & A study of Washington Fourth quarter 1997... All except child-only Includes only cases 16 percent Fogarty, 1999). State TANF departures cases. off TANF for at Cohort II. least 2 months. -------------------------------------------------------------------------------------------------------------------------------------------------------- \1\ The Maryland study also provided data on all closures except: (a) those due to sanctions and (b) cases that returned to TANF within 30 days. For the first group, the rate of return to TANF at 12 months was 23.7 percent; for the second group, 17.8 percent. Source: Table prepared by the Congressional Research Service based on evaluation studies listed in table. SELECTED PROVISIONS OF STATE TANF PROGRAMS Table 7-33 shows some major provisions of Temporary Assistance for Needy Families (TANF) Programs, State by State. The table is based on TANF State plans for fiscal years 2000- 2001, the DHHS 1999 annual report, State laws, and CRS benefit surveys. In 1999, many State legislatures liberalized some TANF rules (allowing more TANF recipients to engage in postsecondary education, providing transportation support, etc.). Some States increased maximum benefit levels. These changes were facilitated by abundant TANF funds and by the dramatic cut in caseload numbers, which has sharply reduced effective work participation rates required for all families. State plans provide different levels of detail, have no standard format, and sometimes describe similar programs in different ways. Column 2 shows how long a recipient may receive basic assistance without engaging in work as defined by the State (24 months is the Federal outer limit). Column 3 shows the first activity required of an applicant/recipient. Column 4 shows the State cutoff time limit (60 months is the Federal outer limit).\10\ This does not mean that all recipients will lose eligibility for ongoing cash assistance after being on the rolls for the number of months in the column. States have the power to stop their own benefit cutoff clocks by exemption (not counting months of assistance during which persons have a time- limit exemption). Some States exempt certain groups, such as the aged, from the clock. Some stop their clocks during months in which recipients work a minimum number of hours (examples include Illinois, Louisiana, Maryland, and Rhode Island). States also may extend federally funded assistance beyond their own cutoff point if it is shorter than 60 months. The Federal clock is a different matter; States have no power to stop the Federal clock unless: (1) they use their own funds for benefits during months when persons are exempted from the State clock;\11\ or (2) under terms of a pre-TANF waiver to the State that included a State time clock, the State makes exemptions to that time limit and uses Federal funds to pay exempted persons. In the former case, months of State-counted aid are not counted by the Federal clock; in the latter case, months not counted by the State clock even though federally funded, need not be counted by the Federal clock (15 States appear to have this option). --------------------------------------------------------------------------- \10\ The law forbids use of Federal TANF funds for ``assistance'' to any family that includes a member who as an adult has received 60 months of aid. TANF regulations define ``assistance'' narrowly, as payments directed at ongoing basic needs, plus supportive services for nonemployed families. No time limit applies to ``nonassistance,'' other TANF-funded services and aid. \11\ For example, Illinois and Maryland use maintenance-of-effort (MOE) funds to pay benefits to persons whose State clock is stopped while they work. TABLE 7-33.--SELECTED PROVISIONS OF STATE TANF PROGRAMS -------------------------------------------------------------------------------------------------------------------------------------------------------- Maximum When first benefits, Work-trigger families family of State time limit First activity required State-set benefit cutoff limit (in months) reach time three Family cap? (months) limit ---------------- 07/96 01/00 -------------------------------------------------------------------------------------------------------------------------------------------------------- Alabama 24 Immediate job search for 60. Aid continues for cases where caretaker was 12/01 $164 $164 No employable applicants not TANF recipient (child-only cases). Exemptions stop State clock. No extensions specified Alaska 24 Self-sufficiency planning 60. No exemptions and extensions specified 07/02 923 923 No Arizona 24 Assessment; work activity 24 out of 60 for EMPOWER, 60 for Arizona Works 10/97 347 347 Yes as soon as possible pilot; 60-month lifetime limit. Aid continues for children. Exemptions stop State clock. Extensions to complete education/training (up to 8 months) and if unable to find work (up to 6 months) Arkansas Immediate Job search 24. Exemptions stop State clock. (includes any 07/00 204 204 Yes month when person is exempt from required work). Extensions for program compliant persons if unable to find work, to complete education (6- month general limit), or to prevent child neglect California 18 Job search 18 or (if working or in community service) up to 06/99 596 \1\ 62 Yes 60. Exemptions stop State clock. Aid continues (State 6 for minors (counties decide form: cash or work \2\ 59 voucher). Extension of 18-month limit (up to 6 trigger 6 months) if job imminent or no job available benefit cutoff) Colorado 24 Sign individual 60. No exemptions. Extensions for up to 20 07/02 356 356 No responsibility plan: percent of caseload for ``good cause.'' immediate work activity may be required Connecticut Immediate Job search/job readiness 21. Exemptions stop State clock. Up to 6-month 10/97 636 636 Yes unlimited extensions if program compliant and unable to find job, or earnings below payment standard + $90. State-funded safety net provides vouchers and third party payments for noncompliant families who reach time limit Delaware One-parent: 24 One-parent: job search 24 (or, if working or in community service) up to 10/99 338 338 Yes Two-parent: Two-parent: immediate 48. Exemptions for months worked at least 20 immediate workfare (for at least hours weekly if countable income below need one parent) standard. Time limit lifted if State unemployment rate exceeds 7.5 percent (or national average). Up to 12-month extension if State failed to provide services, no job available, or if caretaker received aid for 96 straight months (workfare required) District of 24 Immediate job search/job 60. Exemptions stop State clock. No extensions 03/02 415 379 No Columbia readiness for applicants specified assessed able Florida Immediate Assignment to work 24 out of 60 (36 out of 72 if have poor skills 10/98 303 303 Yes activity and little work experience). 48 lifetime limit (earlier for both. Aid continues for cases where for waiver caretaker was not TANF recipient (child-only cases) cases). Exemptions stop State clock. Some hardship extensions and 1-month extensions (up to total of 12) for each month spent in subsidized or unsubsidized work. Extension for child (via protective payment) otherwise at risk of out-of-home placement Georgia 24 Recipients expected to 48. No exemptions. Hardship extensions (20 01/01 280 280 Yes participate in full-time percent of caseload limit) work activity whenever feasible Guam 60 days (if not Register at one-stop 60 7/02 673 673 Yes work exempt) career center Hawaii 24 Applicants not exempt from 60. Exemptions stop State clock. Aid to all work- 12/01 712 \3\ 71 No work referred within 12 exempt families, including those whose caretaker 2 months to further was not a TANF recipient, continues. 3-month \4\ 57 assessment/orientation renewable extensions for families in which all 0 and employment planning adults are program compliant Idaho Immediate Job search required for 24. Exemptions stop State clock. Aid continues 07/99 317 293 Yes (flat all adult recipients for families where caretaker was not TANF benefit) recipient (child-only cases). Extensions for families with disabled child or adult if unable to obtain job with earnings equal to State maximum benefit Illinois 24 Job search/work activity No State limit if working required hours; 24 if 07/99 377 377 Yes required at application not in work/workfare and youngest child older than 12; 60 otherwise. Exemptions stop State clock. State funds exemptions for families working required hours (unlimited); single parent who is full-time postsecondary student with satisfactory grade point average (36 months); and for family headed by minor parent Indiana 24 Sign personal 24. Aid continues for children. Exemptions stop 05/97 288 288 Yes responsibility plan State clock. Up to 24 extra months may be earned through full-time work (1-month extension for 6 months work) Iowa Immediate Immediate work activity 60. Aid continues for child living with nonparent 1/02 426 426 No caretaker. Limited exemption stops State clock. No extensions specified Kansas 24 Immediate job search may 60. Exemptions stop State clock. Aid continues 10/01 429 429 No be required for families where caretaker was not TANF recipient (child-only cases). Extensions for up to 20 percent of caseload Kentucky 24 Work registration a 60. Specified extensions (up to 20 percent of 10/01 262 262 No condition of eligibility caseload) including program compliant adult without sufficient work and grandparent of child at risk of foster care) Louisiana 24 Work activity mandated for 24 out of 60. Lifetime 60. Exemptions stop State 01/99 190 190 No most recipients clock, including months when earned income disregard applies (6-month maximum). Up to 12- month extension to complete education or training Maine 24 Immediate job search for 60. Extensions for whole family if all members 11/01 418 461 No two-parent families whose are program compliant. Adults with 3 or more principal earner is sanctions are ineligible for a specified time underemployed and for single parent with no child below age 5 who has skills needed for work Maryland Not specified. Sign responsibility 60. Exemptions stop State clock, including months 1/02 373 417 Yes Localities contract when family member has earnings. No extensions design own specified work plans Massachusetts 60 days (Single Community service (State 24 out of 60. Exemptions stop State clock. 12/98 565 \3\ 57 Yes parent with waiver) required after 60 Unlimited 6-month extensions in certain cases, 9 child under days including if working full time but making less \4\ 56 school age money than would be eligible to receive as cash 5 exempt.) aid; recipient may be required to undergo vocational assessment and participate in subsidized work. State funds extension beyond 60- month Federal limit Michigan 2 Immediate work placement No State limit. Eligible families not self- No State \5\ 48 \5\ 48 No or job search for those sufficient after 60 months of federally funded limit 9 9 assessed able. (Community TANF will receive State-funded aid \6\ 45 \6\ 45 service required if no 9 9 job after 2 months.) Minnesota One-parent: 6 Job search for work ready-- 60. Limited exemptions stop State clock. No 07/02 532 532 No Two-parent: postponed if participant extensions specified immediate proposes education program (up to 1 year) likely to lead to earnings above TANF income limits. Job readiness for nonwork ready Mississippi 24 Assessment within 30 days 60. No exemptions. Unspecified extensions (20 10/01 120 170 Yes and work referral percent of caseload limit) Missouri 24 Sign individual 60. Exemptions stop State clock (including months 12/01 292 292 No responsibility plan; recipient was in wage supplementation program). State may require work of No time limit for permanently disabled some persons at any time individuals and those age 60 or older. Extensions for hardship and battered persons Montana 24 Develop and sign family 60. (24 maximum in Pathways Program, followed by \7\ 2/01 438 469 No investment agreement, 36 maximum in community services). Exemptions which may require work granted only while in Pathways. Unspecified before 24 months extensions (of 60-month limit) within 20 percent of caseload cap Nebraska 24 from signing Assessment and development 24 out of 48; 60 lifetime. Exemptions stop State 12/98 364 364 Yes of self- of self-sufficiency clock. (Under waiver, exempt months also do not sufficiency contract count toward Federal 60-month time limit.) contract Extension if no job available, if agency failed to provide services in agreement, or if adult recipient no longer able to meet conditions of agreement Nevada 24 Immediate job search 24, then ineligible for 12; 60 lifetime. No 01/00 348 348 No exemptions. Up to 6-month extension if need more time to achieve self-sufficiency. Hardship extensions (24- or 60-month limit); only 20 percent of caseload for 60-month limit New Hampshire 26 weeks Immediate job search/job 60. Extensions allowed by reason of hardship or 10/01 550 575 No readiness activities for if family includes a battered person or one who 26 weeks maximum, then has suffered extreme cruelty. State plans to workfare for additional define other ``hardship'' criteria (apparently 26 weeks maximum within 20 percent of caseload cap) New Jersey 24 Register for WorkFirst; 60. Up to 12-month State-funded extension if in 02/02 424 424 Yes engage in job search full-time work but still eligible for benefits; if no job/work activity available; or if terminated from job through no fault of own. Specified extensions within 20 percent of caseload cap (for Federal funding) New Mexico 2 Assessment and completion 60. Extensions for persons at least age 60 and 07/02 389 439 No of individual for disabled persons or caretakers of a disabled responsibility plan. (By family member end of third month must be fully participating in work activity.) New York 24 Assessment No State limit. State-funded safety net continues No State \8\ 70 \8\ 70 No basic aid for whole family (but it is in noncash limit 3 3 form unless the parent is exempt from work \9\ 57 \9\ 57 requirements) after Federal limit is reached 7 7 North Carolina 12 weeks Register with employment 24 then ineligible for 36; 60 lifetime. 08/98 272 272 Yes program (condition of Exemptions stop State clock. County Board of eligibility) Social Service may grant extension for program compliant families at end of 24-month limit or during 36 months of ineligibility. North Dakota 24 Required to engage in work 60. Extensions (20 percent of caseload limit) 07/02 431 457 Yes activities once allowed for persons physically or mentally determined work ready unable to work; needed to care for severely disabled child; aged caretaker relatives; and victims of domestic violence Ohio 24 Immediate assignment to 36. (24 months after reaching time limit, family 10/00 341 373 No Federal or State work may receive an extra 24 months for good cause.) activity County may provide hardship extensions from State time limit for up to 20 percent of average monthly caseload Oklahoma 24 Job search. Development of 60. No exemptions. No extensions specified 10/01 307 292 Yes employment plan and assignment to work or work activity as soon as possible Oregon Not specified Assessment. Engage in 24 out of 84. Exemptions stop State clock. 07/98 460 460 No required activities (Months in compliance with work program do not count and months when earned income equals or exceed 173 percent of State minimum wage count only as 40 percent of a month.) Aid continues for cases where caretaker was not TANF recipient (child-only cases). Up to 1 percent of caseload (or 400 families, if greater) may receive extensions for good faith effort to find work Pennsylvania 24 Immediate job search 60. No exemptions. No categorical extensions (but 03/02 421 421 No State may provide hardship extensions to 20 percent of caseload) Puerto Rico 2 (if not work Develop individual 60. 07/02 180 180 No exempt) responsibility plan. Perform community service if no job after 2 months Rhode Island 24 Develop employability plan 60. State-funded aid continues for children. 05/02 554 554 No Exemptions stop State clock (includes stopping of State clock for any recipient working 30 or more hours per week). No extensions specified South Carolina 24 Applicants must document 24 out of 120; 60 lifetime. Exemptions stop State 10/98 200 204 Yes at least 10 employer clock. Up to 6-month extension for persons in contacts during approved training programs; up to 12-month application process extension if program compliant but no job. (recommended 2 weeks). If Thereafter, county director may grant month-to- fail to do so without month extensions good cause, application is denied South Dakota 2 Sign personal 60. Extension policy not specified 12/01 430 430 No responsibility plan. Perform community service if no job after 2 months Tennessee Immediate Agree to personal 18 at a time (then 3 months off); 60 lifetime. 04/98 185 185 Yes responsibility plan that Exemptions stop State clock. Parent/caretaker requires immediate work functioning below grade level 9 not subject to preparation or work Federal or State time limit (most must attend activities school). Up to 6-month extensions if in high unemployment area. Extensions if working and family income is below payment standard plus $90 Texas Not specified Work force orientation 12 for some high school graduates; 24 for those 05/97 188 201 No (condition of with 3 years of high school or specified recent eligibility) work; 36 for those with less than high school diploma and with less than 6 months work experience. Aid continues for children. Exemptions stop State clock. Extensions on case- by-case basis Utah Immediate Complete individual 36. Up to 24-month extension if employed 80 hours 01/00 426 451 No employment plan in 6 of 24 previous months. Extension if circumstances have prevented earnings sufficient to close the case Vermont One-parent: 30 Create family development No State limit (Also, Vermont maintains that the No State 633 708 No Two-parent: 15 plan and participate in 60-month limit on use of Federal TANF funds is limit New resident: 5 work readiness. inconsistent with its waiver program.) (Community service required if no job after times in left column.) Virginia 90 days Referred to work program 24 out of 60; 60 lifetime. Exemptions stop State 07/97 354 354 Yes within a month of case clock. Extensions (3-12 months) if program approval compliant but no job, in continuing education and training directly related to employability, or living in area of State with unemployment above 10 percent Virgin Islands 24 Sign an individual 60. Unspecified hardship extensions (up to 20 07/02 240 240 No responsibility plan percent of caseload) Washington Immediate Job search as part of 60. Exemptions will not stop the State clock 01/02 546 546 No employability assessment until family has received 52 months of aid. Extensions allowed (20 percent of caseload limit) for hardship or victims of domestic violence. State plans to establish specific hardship criteria West Virginia 24 Attend work program 60. Extensions on case-by-case basis 01/02 253 328 No orientation; sign personal responsibility contract Wisconsin Immediate Work or training activity 60. Limited exemption (no job, high unemployment 10/01 517 \10\ 6 Yes (flat immediate; community area) stops State clock. Extensions on case-by- 73 benefit) service required by case basis \11\ 6 employables if no job 28 after 2 months Wyoming Immediate Job search 60. If received AFDC for 36 or more months before 01/02 (2/99 360 340 Yes 1/97, then eligible for 24 months assistance for after 1/31/97. Extensions for adult student previous within 1 year of degree or completing vocational AFDC training families) -------------------------------------------------------------------------------------------------------------------------------------------------------- \1\ Region 1 of California. \2\ Region 2 of California. \3\ Work exempt. \4\ Nonwork exempt. \5\ Washtenaw County, Michigan. \6\ Wayne County, Michigan. \7\ Montana's State time limit clock is different from its Federal one, which first families are to reach February 2002 (sooner for certain interstate migrants). \8\ Suffolk County, New York. \9\ New York City. \10\ Community service jobs. \11\ W-2 transitions (work preparation activities). Source: Table prepared by the Congressional Research Service on the basis of information in TANF State plans, State laws, and State regulations and the TANF 1999 annual report prepared by the U.S. Department of Health and Human Services. When the Federal clock is reached, any State may extend federally funded aid to up to 20 percent of the caseload on grounds of hardship or presence of a battered family member.\12\ For cases in which the State has chosen 60 months as its own benefit cutoff limit, the table shows the kinds of extensions that the State says it will allow; i.e., the table lists the categories of persons who will continue to be aided even if they require State funding because they do not fit into the Federal 20 percent hardship/battered person allowance. Some States do not list any extensions, and some States indicate that they plan to restrict any extensions to 20 percent of the caseload. Three States have no State benefit cutoff time limit (Michigan, New York, and Vermont). --------------------------------------------------------------------------- \12\ TANF regulations provide that if a State exceeds the 20 percent allowance for hardship or domestic violence extensions, the State may be eligible for a ``reasonable cause'' exemption from the penalty for violating the time limit. --------------------------------------------------------------------------- LEGISLATIVE HISTORY (For a more extensive legislative history of AFDC, see previous editions of the Green Book.) Public Law 104-193, the Personal Responsibility and Work Opportunity Reconciliation Act established the program of Temporary Assistance for Needy Families (TANF) and appropriated funds for annual block grants through fiscal year 2002. August 22, 1996. Public Law 105-333, the Balanced Budget Act of 1997, established the Welfare-to-Work (WTW) Grant Program and appropriated $3 billion for the 2-year period, fiscal years 1998 and 1999. This act also made technical corrections to TANF. August 5, 1997. Public Law 106-113, the Consolidated Appropriations Act, broadened eligibility for WTW grants and added limited vocational educational or job training to allowable activities. November 29, 1999. REFERENCES Ackerman, D. (1999). Charitable choice: Background and selected legal issues (RL30388). Washington, DC: Congressional Research Service. Ahn, J. & Fogarty, D. (1999). A study of Washington State TANF departures and welfare reform: Cohort II. Olympia, Washington: Department of Social and Health Services. Allen, K. & Kirby, M. (2000, July). Unfinished business: Why cities matter to welfare reform. Washington, DC: Brookings. Blank, R. (1998). What causes public assistance caseloads to grow? Poverty Research News, II(2), 6. 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Washington, DC: Congressional Research Service. Ellwood, D.T., & Bane, M.J. (1985). The impact of AFDC on family structure and living arrangements. Research in Labor Economics, 7, 137-207. Fagnoni, C. (1999). Welfare reform: States' implementation and effects on the work force development system (Testimony). Washington, DC: General Accounting Office. Falk, G., & Schroeder, C. (1998). Welfare reform: Time limits under TANF (98-932). Washington, DC: Congressional Research Service. Federal Register. (2000, February 18). TANF program regulations, 65(34), 8478-558. Foster, E. (1999). Amended quarterly progress report: Outcomes for single parent leavers by cohort quarter for January-March 1999. Atlanta: Georgia State University. Ku, L., & Bruen, B. (1999). The continuing decline in Medicaid coverage (Series A, No. A-37). Washington, DC: Urban Institute. London, R., & Valvano, V. (1999). Evaluation of the Colorado Works Program: First annual report. Oakland, California: Berkeley Planning Associates. Mancuso, D. & Moses, A. (1999). Examining circumstances of individuals and families who leave TANF: Assessing the validity of administrative data (Interim Report). Belmont, California: County of San Mateo, Human Services Agency. Meyer, D., & Cancian, M. (1996). Life after welfare: The economic well-being following an exit from AFDC (Discussion Paper No. 1101-96). Madison: University of Wisconsin, Institute for Research on Poverty. National Governors' Association. (1999, March). Summaries of selected elements of State plans for TANF. Washington, DC: Author. Pavetti, L. (1995, September 11). Questions and answers on welfare dynamics. Paper presented at a research meeting on welfare dynamics, Urban Institute, Washington, DC. Pew Center on the States. (2000). Selected State welfare provisions. Rockefeller Institute of Government. (1999). After welfare: A study of work and benefit use after case closure. Albany, New York: Author. Sandefur, G., & Cook, S. (1998, December). Permanent exits from public assistance: the impact of duration, family, and work. Social Forces, 77, 763-786. School of Social Work, University of Maryland-Baltimore. (1999). Life after welfare: Third interim report. Baltimore, Maryland: Department of Human Resources. University of Maryland. (1999). Life after welfare: third interim report (Prepared by welfare and child support research and training group, School of Social Work). Baltimore: Author. U.S. Department of Health, Education and Welfare. (1970). Preliminary report of findings--1969 AFDC study (NCSS Report AFDC-1). Washington, DC: Author. U.S. Department of Health and Human Services. (1982). Aid to Families with Dependent Children: 1979 recipient characteristics study. Washington, DC: Author. U.S. Department of Health and Human Services. (Undated). Characteristics and financial circumstances of AFDC families, fiscal year 1988. Washington, DC: Author. U.S. Department of Health and Human Services. (Undated). Characteristics and financial circumstances of AFDC families, fiscal year 1994. Washington, DC: Author. U.S. Department of Health and Human Services. (Undated). Characteristics and financial circumstances of AFDC families, fiscal year 1996. Washington, DC: Author. U.S. Department of Health and Human Services. (1998). Aid to Families with Dependent Children. The Baseline. Washington, DC: Author. U.S. Department of Health and Human Services. (1999). Temporary assistance for needy families (TANF) program (Second annual report to Congress). Washington, DC: Author. U.S. Department of Health and Human Services. (2000). Indicators of Welfare Dependence (Third annual report to Congress). Washington, DC: Author. U.S. General Accounting Office. (1999). Welfare reform: Implementing DOT's access to JOBS Program in its first year (RCED-00-14). Washington, DC: Author. Zedlewski, S., & Brauner, S. (1999). Are the steep declines in food stamp participation linked to falling welfare caseloads? (Series B, No. B-3). Washington, DC: Urban Institute.