By: LaDonna Pavetti, Jacqueline Kauff, Michelle K. Derr, Jeffrey Max, Ann Person, and Gretchen Kirby Mathematica Policy Research
This report is available on the Internet at:http://aspe.hhs.gov/hsp/08/TANFWPR/5/
Printer Friendly Version in PDF Format (25 pages)
- Work Participation Rates and Requirements under the DRA
- I. Creating New Work Opportunities for TANF Recipients
- II. Administrative Strategies
- III. TANF Policy Changes
- IV. Creation of New Programs
This brief describes a range of strategies states have implemented to achieve higher Temporary Assistance for Needy Families (TANF) work participation rates. It summarizes material presented in four other practice briefs in this series and includes some additional material not presented in those briefs. This brief describes four broad categories of strategies: (1) creating new work opportunities for TANF recipients; (2) administrative strategies; (3) TANF policy changes; and (4) creation of new programs.
Since the passage of the Personal Responsibility and Work Opportunity Reconciliation Act (PRWORA) in 1996, the tenets of work and self-sufficiency have become the cornerstones of the TANF program, a block grant to states to provide assistance to low-income families with children. While all states continue to provide cash assistance to low-income families through their TANF programs, states also must also help recipients find work and meet minimum work participation rates and other program requirements to avoid fiscal penalties. As a result of changes to TANF in its reauthorization through the Deficit Reduction Act of 2005 (DRA), states began to reevaluate their existing TANF policies and practices and consider new strategies in order to meet higher effective work participation rates.
This summary brief describes a range of strategies states have implemented to achieve higher work participation rates. It summarizes material presented in four other practice briefs in this series and draws on information from other sources, including discussions with state officials, materials gathered from site visits for this and other related projects, published reports, talks given by state officials at public meetings, and written materials readily available from state agencies. The information presented here is not based on systematic data collection, so it should not be viewed as a representative or comprehensive statement on states' responses to the DRA. Rather, it is a sampling of the kinds of approaches states have utilized to achieve higher work participation rates, and it should be interpreted with that perspective in mind. For ease of presentation, we have divided the strategies into four broad categories.
- Creating new work opportunities for TANF recipients. In order to meet their work requirements, the states must engage substantial numbers of TANF recipients in some type of paid or unpaid work activity. (For federal work participation rate purposes, a limited number of recipients participating in vocational education also can be counted, as can recipients participating in job search and job readiness assistance for up to the maximum number of weeks allowed.) To provide work opportunities to recipients who do not find unsubsidized employment within the countable job search period, some states have expanded existing work programs or created new ones, including unpaid and paid work experience and paid work-study programs. It should be noted that states also can place recipients in unpaid community service programs, but we do not profile those in this brief.
- Administrative strategies. Because the statutory penalties for failing to meet work participation rate requirements can be significant, some states and local welfare offices decided to develop new approaches to administering their TANF programs to help reach their work participation goals. Administrative strategies include changes in the way the TANF program is managed and/or the way in which services are delivered. One tactic is to make sure that everyone responsible for administering the TANF program is aware of and held accountable for the role he or she plays in achieving the target work participation rate. We profile examples of two strategies: (1) using data to better manage the TANF caseload and pinpoint systemic problems that may be contributing to low participation rates, and (2) using performance-based contracts to hold service providers accountable for achieving program participation goals.
- TANF policy changes. When TANF was created, states were given the flexibility to make their own decisions about the policies and procedures that would guide implementation of their programs. When the DRA was passed, many states revisited these policies and some made changes. We discuss two key policy areas in which states have made changes in an effort to meet their work participation rates: earned income disregard and sanction policies.
- Creation of new programs. Some states have used the broad flexibility available to them under the block grant to create new programs to serve specific population groups or to assist low-income families outside of their TANF programs. For example, some states have created new worker supplement programs to keep working families on the caseload longer. Others have created temporary support programs to delay TANF applicants' entry into or to divert them from the TANF caseload. Finally, some states have created completely state-funded programs that serve families with a very low probability of meeting their work participation requirement, and that are not counted in meeting states' maintenance-of-effort (MOE) requirements. By doing this, states avoid having such families count in the work participation rate calculation.
Before discussing the specifics of strategies in each of these categories, we provide a summary of the context in which they are being implemented.
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The DRA maintained the same work participation rates that were originally enacted in 1996 (50 percent for all families and 90 percent for two-parent families), but other changes included in the DRA effectively increased the work participation rate that states must achieve and modified what and how participation is counted in calculating the rate. The key changes include:
- updating the base year for calculating the caseload reduction credit from 1995 to 2005
- extending work participation requirements to families with an adult receiving assistance in a "separate state program" funded with state MOE dollars
- directing the U.S. Department of Health and Human Services to define each of the 12 countable work activities and the type of documentation needed to verify reported hours of work as well as to determine who is a work-eligible individual.
The DRA also established a new penalty of up to 5 percent of a state's block grant if a state fails to implement verification procedures and internal controls consistent with the regulations. This is in addition to the already-existing PRWORA penalty for failing to achieve the minimum participation rates, which is a 5 to 21 percent reduction in a state's family assistance grant (reduced based on the degree of noncompliance) and an increase in the MOE requirement from 75 to 80 percent.
Single parents without a child under age 6 must participate in countable work activities for 30 hours each week, and two-parent families must participate for 35 hours if they don't receive federally funded child care assistance (55 hours if they do). Through the final regulations, HHS developed definitions of work activities, including the core activities in which TANF recipients are required to participate for at least the first 20 hours of their work requirement (30 hours for most two-parent families) and non-core activities in which the recipient can participate for any hours required over the minimum core hour requirement. In an effort to achieve comparability in the work participation rates across states, HHS attempted to create non-overlapping definitions for the various work activities.
In the regulations, HHS also clarified who is to be considered work-eligible, and, therefore, included in the work participation rate calculation. Work-eligible individuals include most adults and minor heads-of-households who receive assistance and some non-recipient parents (for example, some parents in child-only cases). Adults receiving assistance who are not included in the state's work participation calculation include those receiving MOE-funded assistance under an approved Tribal TANF plan and those providing medically documented needed care for a family member with a disability who is living at home. States also can exclude (for a maximum of 12 months) cases that include a single custodial parent caring for a child less than 12 months of age. Non-recipient parents who are not included in the work participation rate calculation include those who are ineligible to receive assistance due to immigration status; at state option on a case-by-case basis, parents receiving Supplemental Security Income (SSI) or Social Security Disability Insurance (SSDI); and minor parents who are not the head of household.
The DRA was signed into law in February 2006 and states became subject to the new requirements in October 2006. While states were not required to submit formal plans for how they would meet the new requirements, they were required to submit work verification plans to describe which activities count for participation rate purposes and how their services and programs would meet the definition of a work activity; their plans for monitoring participation in work activities, including the documentation they use to ensure they report actual hours of participation; and how they planned to identify cases that should be included in the work participation rate calculation (for example, "work-eligible" families).
At the time the DRA passed, only a few states had reported work participation rates of 50 percent for all families, and none had reported work participation rates of 90 percent for two-parent families. Thus, many states had a significant gap to close in order to meet the requirements of the DRA.
Largely due to differences in the design of their TANF programs and their approaches to implementing TANF work requirements prior to the DRA changes, states faced a range of different circumstances in implementing the DRA. Because states experienced significant caseload declines between 1995 and 2005, but less so after 2005, the change in the base year for the caseload reduction credit substantially increased effective work participation rates for most states.
The inclusion of some families who previously had been excluded from the work participation rate calculation substantially affected some states, but had very little effect on others. The states most affected by this change include: (1) those with partial sanction policies that reduce the TANF grant provided to a family by removing the parents' "needs" from the grant calculation when a parent does not comply with program requirements these cases have been considered "child-only" cases in the past and thus were excluded from the work participation rate calculation; (2) those that continue to provide TANF assistance to children when their parents reach the TANF time limit; and (3) those that operate programs with state funds that are counted toward the state's MOE requirement.
Many states defined work activities more broadly than the definitions included in the final regulations. In states that had adopted broader definitions, some recipients that had counted as meeting the work requirement no longer could be counted under the definitions included in the regulations. On the other hand, other DRA-related changes may boost states' ability to achieve their work participation rate requirements. For example, the HHS regulations allow states to count some time for excused absences and holidays for recipients participating in unpaid activities.
Responding to their own circumstances, states adopted many different approaches to meet the effectively higher work participation rate requirements. In this brief, we describe some of the strategies states and local welfare offices implemented. Some specific examples of each strategy are provided. Because states are at an early stage of implementing these strategies and none has been rigorously evaluated, it is too soon to tell which strategies may hold the most promise for helping states to achieve higher work participation rates.
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The DRA strengthens work participation requirements and emphasizes participation in paid or unpaid work to meet work requirements. In order to engage more recipients in these activities, some states and local welfare offices have made greater efforts to place recipients in unpaid work experience programs. Some states also have created new subsidized employment programs or expanded old ones. In order to allow participation in vocational education programs for longer than one year, some states and local programs provide paid work-study positions that permit recipients to meet their 20-hour core work requirement through subsidized employment. The hours spent in vocational education can be counted as job-skills training directly related to employment, a non-core activity, and can be used to meet any hours required above 20.
Although some policymakers anticipated that states would create large unpaid work experience or community service programs when PRWORA was enacted, only a few states did so. Now that states are required to meet effectively higher work participation rates, there has been renewed interest in creating and/or expanding such programs. When recipients participate in unpaid work experience or community service programs, they work in exchange for cash assistance and food stamps. These programs are generally subject to the Fair Labor Standards Act (FLSA) which restricts the number of hours recipients can be required to work to the combined value of their TANF and food stamp benefits divided by the higher of the local or federal minimum wage. If the number of hours a recipient is permitted to work under the FLSA is less than the "core" number of hours a recipient is required to work (that is, 20 hours for single-parent families), the individual can be counted as meeting his/her "core" work participation rate requirement as long as the full number of hours allowed under the FLSA is being reached and the state has a Simplified Food Stamp Program (SFSP) or mini-SFSP in place. Families with a 30-hour requirement would have to participate in 10 additional hours of other core or non-core activities in order to meet the participation requirement.
Erie County, New York (Buffalo). After examining the structure of its TANF employment program and the condition of the local economy, the Erie County Department of Social Services (DSS) concluded that an expanded and redesigned work experience program would give TANF recipients the best chance of meeting the federal work requirement and also give them the opportunity to build their work skills. To maximize participation in work experience, Erie County restructured its existing work experience program.
One unique feature of Erie County's restructured program is its focus on providing work experience opportunities for TANF recipients close to where they live. Contracted service providers, operating out of four neighborhood hub sites, provide work experience opportunities and administer Erie County's program. The neighborhood hub sites are community centers or large nonprofit organizations, located in areas where most TANF recipients live, that provide a variety of social service programs to neighborhood residents. In selecting hub sites, DSS chose agencies where recipients and their families could access a range of supports during the work experience placements. These supports include child care, mental health counseling, and after-school programs.
Erie County's program is targeted to recipients who are deemed "work-ready" as determined by an upfront assessment and triage process. Recipients are deemed work-ready as long as they are not in one of the following categories: (1) actively participating in a day or residential substance abuse treatment program, (2) have a documented physical and/or mental health condition, or (3) appear to be eligible for SSI or SSDI. Recipients are referred for a work experience placement immediately after their application for TANF assistance has been approved. All job-ready applicants are required, as a condition of eligibility, to participate in a three-week job search program prior to approval. Those referred for a work experience placement have not been successful at finding unsubsidized employment through the applicant job search program.
Most TANF recipients in Erie County are required to participate in work activities for 35 hours per week, with a minimum of 20 hours in paid or unpaid work. Some work experience participants complete all of their required hours in work experience; others complete any required hours over 20 in a non-core activity, such as education (for recipients who have not completed high school or a GED) or job training related to employment. Recently, the county has worked with the hub sites to help them develop GED classes and short-term vocational training programs such as computer training.
A second unique feature of Erie County's program is that the contracted service providers hire work site supervisors to work exclusively with TANF recipients. (Most unpaid work experience programs rely on employees of the worksite to provide supervision without any additional financial compensation.) Each supervisor works with 15 to 35 work experience participants, and the supervisors' primary responsibility is to teach TANF recipients job skills and acceptable workplace habits.
Work experience participants may be assigned to a specific position at the hub site, or their assignments may be project-based, such as installing coat racks at a new day care center, and which change after each project is completed. Common positions filled include receptionist, groundskeeping or clerical support. When the work site supervisor determines that the participant is ready to seek permanent paid employment, a job developer assigned to the work site helps the participant identify and apply for available jobs, including some that are subsidized by the county. (Erie County's subsidized employment program is described below.)
Montana. For more than a decade, Montana's Office of Public Assistance (OPA) has relied on work experience to teach TANF recipients job skills and basic work habits. Montana's program operates statewide, and OPA hires contractors to provide all case management and employment and training services, including work experience for TANF recipients. It targets the entire TANF caseload, including hard-to-employ individuals. This requires the state to offer a range of work placements which they provide at both government and nonprofit agencies. Recipients assigned to work experience are required to participate for 33 hours per week and can spend no more than three months at any given work site. Staff believe that establishing a transition point prevents the recipient from treating the placement like a permanent job and creates a natural point at which a recipient might move to competitive employment.
Montana uses work experience placements to build the job skills of TANF recipients, particularly those with limited skills and experience. Individualized training plans negotiated between the recipient, the work experience coordinator, and the employer providing the placement establish expectations about the training and capacity-building activities that the employer will offer in exchange for the recipient's labor.
To accommodate for the varying skills, capabilities, and circumstances of TANF recipients, Montana has created two tiers of work placements and makes the assignments according to job readiness. Tier one placements are for individuals with limited work experience and more personal and family challenges; tier two placements are for individuals with stronger work skills who need less supervision. Participants in both tier one and tier two placements may perform janitorial, retail, clerical, or customer service tasks, but those assigned to tier one will undertake less complicated tasks. For example, participants in tier one placements might do filing, while those in tier two might be assigned more complicated tasks, such as word processing or responding to information requests. Recipients in tier one placements also are placed at agencies where they can receive greater supervision and support. At any point in time, roughly two-thirds of the work-mandatory TANF recipients are assigned to tier one work placements, and the remaining one-third are assigned to tier two work placements. Recipients may move up to tier two as job-readiness improves.
In order to provide TANF recipients with more income and hasten the movement to a permanent unsubsidized job, some states and local welfare offices have created new or have expanded already existing paid work programs. In some cases, the programs come with a guarantee of a permanent job after successful completion of a time-limited period of subsidized employment. In addition to providing paid employment, these programs usually provide case management services and job search assistance.
Erie County, New York (Buffalo). To create more permanent job opportunities for TANF recipients, Erie County DSS created the PIVOT (Placing Individuals in Vital Opportunity Training) program. Recipients are hired by a private-sector employer under an agreement that the county will pay the recipient's wages for six months and the employer will provide training and commit to hiring the recipient permanently at the end of the term (assuming the individual has performed adequately). PIVOT, which targets those ready for competitive employment, is offered as a reward for TANF recipients who show up consistently and perform well at their work experience placement.
Employers conduct a formal hiring process, including job interviews, with 10 to 15 TANF recipients whom county job developers identify as being appropriate for the position. Recipients are referred to the interview pool by the job developer based on how well their skills match the job requirements as well as their level of interest in the position. Employers can choose how to screen and interview recipients; some interview a select group, while others interview everyone referred to them. For employers, PIVOT is a way to screen and train potential entry-level workers. For Erie County DSS, PIVOT is a way to engage employers who are willing to hire TANF recipients. And for TANF recipients, PIVOT creates opportunities to transition into competitive, unsubsidized employment. At any given point in time, approximately 400 TANF recipients are in PIVOT jobs and 85 percent of them transition into a permanent job with their PIVOT employer.
Washington State Community Jobs and Career Jump Programs. Washington State's TANF program known as WorkFirst partners with the state Department of Community, Trade, and Economic Development (CTED) to provide subsidized employment programs for TANF recipients. CTED's original supported work program, called Community Jobs, has been operating since 1998 in every county in the state. It serves an average of 2,200 clients per year and has achieved a 64 percent placement rate to unsubsidized employment. In response to the DRA, Community Jobs was expanded and augmented with several additional work opportunities for TANF recipients.
Community Jobs combines training opportunities with intensive case management services to TANF recipients who have been unsuccessful in traditional WorkFirst job readiness activities. The program is administered by paid contractors who provide case management services to families and develop temporary paid placements at nonprofit organizations and public agencies for 20 to 30 hours per week. Recipients may simultaneously enroll in an education activity for a minimum of 10 hours per week.
A second program, the Career Jump Program, operates the same way and provides the same services as Community Jobs except that the worksite is a business which has made a commitment to hire the participant at an agreed-upon time. Career Jump combines the opportunity to gain training while on the job with the additional assistance of the CTED-contracted case manager who helps with personal or family issues that might arise.
Diversified Employment Opportunities, Davis County, Utah. In October 2006, the Northern Region of Utah's Department of Workforce Services (DWS) contracted with Davis Behavioral Health (DBH), a large county mental health treatment provider, to provide unsubsidized transitional employment for up to 20 TANF recipients with diagnosed mental health disabilities through the Diversified Employment Opportunities (DEO) program. The program hires TANF recipients living with a disability as regular employees and pays them $6.50 per hour to perform jobs within the agency's 14 locations. Jobs include janitorial, food service, landscaping, painting, and clerical positions. Work hours are based on clients' mental health status. Typically, clients start out working a small number of hours which gradually increases as their capacity to work increases. The recipients' wages are paid by Davis Behavioral Health (with no funds from their DHS contract), but the supportive services are paid directly with TANF funds.
Specific components of the DEO program include: (1) unsubsidized transitional paid job opportunities for clients, (2) resources for identifying and addressing clients' mental health needs, (3) work supports such as child care, and (4) ongoing collaboration and service coordination by a team of DBH/DEO and DWS staff and mental health professionals. TANF recipients can participate in the program as long as needed, but they are encouraged to seek competitive employment that will provide higher pay and better long-term career opportunities.
Although most TANF programs focus on getting recipients into work as quickly as possible, some also encourage participation in vocational education programs, often through a special arrangement with community colleges. Participants in vocational educational programs can account for no more than 30 percent of recipients meeting their work requirement, and an individual's participation in vocational education can be counted toward the work participation rate for no more than 12 months in his or her lifetime. One strategy states have used to support recipients who want to enroll in vocational programs that last longer than a year is to provide them with paid work-study opportunities. This allows recipients to meet their core 20-hour requirement through paid subsidized employment and to use hours spent in school to meet any required hours above the 20. The hours spent in a vocational program can be counted as job-skills training directly related to employment a countable non-core activity as long as the activities are directly related to a specific job or occupation. Below, we profile two statewide programs that provide work-study opportunities to TANF recipients participating in a vocational education program.
Ready to Work (Kentucky). Kentucky established the Ready-to-Work (RTW) program in 1999 to improve access to education for individuals on public assistance. RTW is designed to support TANF recipients in the pursuit of post-secondary education by providing personal support, linking participants with services at the colleges and in the broader community, and providing work-study opportunities. The ultimate goal of the statewide program is to prepare participants to qualify for higher-paying jobs. Work-study has been a significant focus since RTW's early days, and that component has assumed even greater importance since passage of the DRA.
Rather than creating vocational opportunities specifically for TANF recipients, Kentucky's RTW program helps recipients participate and succeed in existing community college programs while meeting work participation requirements. The Kentucky Community and Technical College System (KCTCS) operates the program on each of its 16 campuses. Recipients can pursue certificate, diploma, and associate-degree programs, and are permitted to select any field of study offered by the participating college.
Paid work-study opportunities are available at all sites, but each community college decides how to structure them. As an example, the RTW program in Ashland, a small community in the northeast corner of the state, uses two different types of work-study placements in a tiered system. The initial work-study placements focus on building basic job skills and allowing the individual to settle into a regular schedule of school and work. Most placements are at the community college or in nonprofit organizations; these placements offer a nurturing environment where the individual can begin to build the soft skills (for example, time management and communication) needed to succeed in the workplace. Recipients often perform entry-level clerical tasks, such as filing, or customer service activities, such as helping families in need of emergency food. After participants have mastered such basic soft work skills as working required hours regularly, they move to a second-tier placement, where they can begin to build skills in their field of interest. These placements are very individualized and are selected to help recipients gain work experience and credentials to qualify for jobs in their field of study once they have completed their education. In Ashland, many of these placements are in hospitals or social service agencies since many students pursue educational programs in the health or human services field.
When TANF recipients enroll in RTW, they are eligible for up to $2,500 per year in RTW work-study benefits and may be eligible for federal work-study benefits. To stretch the limited financial resources available for the RTW work-study program, participants are required to augment their 15 hours of paid work-study with 5 hours of unpaid community service or work experience, almost always at the same agency.
California Community College CalWORKs (TANF) Program. The California Community College (CCC) CalWORKs initiative, a partnership between the CCC Chancellor's Office and the state's Department of Social Services (DSS), is a campus-based program focused on basic and technical skills development in fields with strong local labor market demand. It provides TANF recipients with comprehensive and coordinated support services that allow them to obtain the education and experience needed to transition off welfare and into a career. As in Kentucky, the CCC CalWORKs program is offered throughout the state, and each community college decides how to implement it. The information presented here describes how the Los Angeles Community College District (LACCD) and Long Beach Community College (LBCC), in conjunction with the Los Angeles Department of Public Social Services (DPSS), have implemented the program.
TANF recipients can enter the CCC CalWORKs program in two ways. First, students who are already enrolled in a community college program who later become TANF recipients can continue their course of study and have access to all the benefits of the CCC CalWORKs program. Second, recipients who complete four weeks of job search and do not find employment undergo a thorough assessment to determine the best employment or career path, with one of the possibilities being enrollment in an educational program that will lead directly to employment. Statewide, several certificate programs were developed or redesigned using CCC CalWORKs funds dedicated to curriculum development to help CalWORKs students enter occupations where movement up a career ladder is possible. Some examples of the certificate programs created include pharmacy technician, geographic information systems, bookkeeping, and culinary arts.
CCC CalWORKs is explicitly charged with interfacing with the county welfare office, other public agencies, and the broader community college infrastructure to facilitate students' transition into college and work, and to ensure non-duplication of services and the efficient use of public funds. The LACCD and LBCC programs take a basic case management approach whereby program advisors identify student needs and make referrals to the appropriate office or agency. Examples of services to which recipients may be referred include those which address domestic violence, mental health issues, housing problems, financial aid, transportation assistance, and legal issues. CCC CalWORKs case management involves communication with the student's TANF caseworker, to report on the student's activity in the program and to advocate so students receive services they need. CCC CalWORKs case managers also handle the various subsidies for which CalWORKs students qualify, including childcare vouchers, clothing stipends, and reimbursement for the cost of books.
In 2006, as a part of efforts to increase the TANF work participation rate, the state legislature allocated $8 million to community colleges statewide to increase work-study placements and $1 million to provide additional funds for job development and placement activities. Community colleges were expected to use the work-study allocation to increase the number of off-campus placements. They also were required to provide a dollar-for-dollar funding match. The additional placements were to be targeted to CalWORKs students who had an employment plan in place and needed hours to meet their work participation requirement. DPSS worked with LACCD and LBCC to apply for these funds. LACCD received $1.7 million to create additional placements and expand job development efforts, and LBCC received $300,000. The DPSS agreed to cover 25 percent of the cost of the work-study wages for participants placed in government jobs. The remaining match came from the community colleges.
LACCD and LBCC offer students three types of work-study placements: (1) on-campus; (2) off-campus, typically in small businesses or nonprofits; and (3) off-campus in Los Angeles government agencies. CCC CalWORKs requires that a work-study placement match a recipient's occupational goal, although in practice it is not always possible to achieve this. Placing students in government agencies was a major focus of the county's efforts to expand off-campus work-study opportunities because many students express interest in pursuing human services careers, and employment has been expanding in the public sector. Several county agencies, including the social services, health and mental health departments, and the public K-12 school system, agreed to accept work-study students. The work the students perform depends on the needs of the agency sometimes it is administrative; sometimes it is focused on providing direct assistance to agency customers. For example, recipients with a work-study position in the school system might work in the library or help supervise children on the playground or in the lunch room. The typical wages are $8 to $9 per hour for entry-level positions and $10 to $11 per hour for students with work experience. Work-study wages below $12 do not affect the student's CalWORKs grant.
Since it is funded by the state and the counties, CCC CalWORKs work-study is not subject to the same restrictions as federal work-study programs (though state and federal work-study funds may be combined, in which case the federal rules would apply). By using state and local funds, students can work in a broader range of settings, including working with for-profit employers, and continue in their work-study placements when school is not in session.
Work-study employers serve as the employer of record (except in the case of Los Angeles County government; see below) and are responsible for paying 25 percent of a student's wages and all taxes (including FICA and Medicare). They also are responsible for covering workers' compensation. The CCC CalWORKs program covers the remaining 75 percent of the student's wage. Employers submit timesheets every other week, pay the full wage, and are reimbursed by CCC CalWORKs at the end of the fiscal year.
For work-study placements in county government agencies, the Los Angeles DPSS covers 25 percent of the student's wages and taxes and CCC CalWORKs covers the remaining 75 percent. The participating government agencies do not contribute financially to the program. Because it would have been difficult to establish payroll procedures for work-study students, DPSS did not want to serve as employer of record and hired the local Workforce Investment Board (WIB) to assume this role. The government agencies in which students are placed submit timesheets to the WIB every two weeks and the WIB delivers paychecks to the community colleges every other week for student pickup.
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In order to meet the effectively higher work participation rates, some states and local welfare offices decided to develop new approaches to managing their TANF caseloads. One of the first steps some states took was to analyze their caseload and determine who was not meeting the work participation requirement, and of those not meeting that requirement, who was participating for some hours and who was not participating at all. Other states decided to reconsider how they provided services and how they would hold contractors and staff accountable for meeting agreed-upon work participation rates. In this section, we discuss two administrative strategies some states have used to achieve higher work participation rates. First, we discuss strategies for using data to manage and encourage participation in work activities. Then we discuss strategies for using performance-based contracts to hold contractors accountable for achieving high levels of participation in work activities.
In recent years, several states and localities have begun using TANF administrative data to monitor and improve program performance. This strategy does not necessarily require development of new data collection systems, but does require new tools, including, for example, hard copy or online reports that enable program administrators and staff to record and analyze existing data more effectively and summarize key outcome measures relative to performance benchmarks. The reports provide a snapshot of how a state and its regions or counties, local offices, and/or individual case managers are performing with respect to meeting pre-determined goals and how they compare with each other. When these tools are available online, case managers can monitor the work participation status of their caseload on a regular basis. These tools can accomplish at least four key objectives with respect to participation: (1) clarify program expectations for staff; (2) hold staff accountable for their performance and contribution toward participation goals; (3) help staff at all levels (case management, supervisory, and administrative) identify problems quickly and brainstorm ways to improve the participation rate; and (4) target case management services to specified groups of recipients (for example, recipients who are participating for an insufficient number of hours). We profile three different strategies, two of them local (New York City and Baltimore) and one statewide (Utah).
New York City's Ring Report. The Ring Report is a tool New York City developed to monitor and improve TANF work participation rates. It is a specialized report that is part of the City's JobStat performance management system. (JobStat is a series of monthly reports created to give each local TANF office information on key performance indicators such as timeliness, referral to and participation in employment and training programs, and job placements.)
The Ring Report consists of outcome indicators and process indicators, some of which affect the participation rate. Five outcome indicators are used to measure the work participation rate: (1) the participation rate of current TANF recipients, (2) the rate of former TANF recipients receiving assistance through New York State's Safety Net program (funded with TANF MOE dollars), (3) the rate of other Safety Net program recipients who are not eligible for TANF, (4) the combined rate of the populations funded by TANF and TANF MOE dollars (equivalent to the federal participation rate requirement), and (5) the monthly change in the combined participation rate (which enables recognition of offices (called Job Centers) that have low participation rates but are improving).
The process indicators include: (1) the percentage all of recipients who have been in the sanction process for five weeks or fewer, (2) the percentage of all recipients engaged in work activities within a month, (3) the fair hearing affirmation rate on employment issues, and (4) the fair hearing win rate on employment issues.
The Ring Report compares Job Center performance on each indicator to goals established by the city's TANF administrative agency. This ensures that Job Centers know the expected level of performance and can gauge success in achieving agency goals. The agency assigns a point value to each indicator based on its relative importance to agency goals. For example, the engagement process indicator is worth 14 out of 100 points and the fair hearing win rate indicator is worth 5 points. Job Centers earn points for each indicator based on their performance relative to agency goals a Job Center achieving 50 percent of the agency goal receives 50 percent of the total point value for that indicator. The points earned for each indicator are summed to calculate an overall point value or index score on a scale of 0 to 100. The index score is designed to represent overall Job Center performance. The outcome (participation rate) indicators represent 60 of the 100 total points, with the indicators for the TANF and MOE participation rates totaling 40 of the 60 points. The process indicators make up the other 40 points.
When the city brought the Ring Report on line, it created a competition (with a ring as the prize) between groups of Job Centers, to generate enthusiasm for focusing on the participation rate as a performance goal. Meetings took place each month to review current performance on each indicator, examine factors that might be affecting performance, and consider ways to improve performance. One meeting was held with each Ring Report team (which consists of three to five Job Centers), and a separate one was held between the city's TANF administrative agency staff and all Ring Report team managers (who are Job Center directors). After a year and a half, the Job Centers' enthusiasm for the competition waned, possibly because the report and the review process became a routine part of efforts to achieve higher work participation rates, and because the work participation rate proved difficult to increase. Use of the Ring Report for performance tracking and measurement is now left to the discretion of each Job Center. Staff can access the indicator and outcome reports online via the ongoing JobStat system.
Baltimore's CenterStat. Maryland uses the JobStat performance management system modeled after New York City's system, to monitor each county's performance relative to the state's performance, particularly with respect to the federal work participation and universal engagement goals. The heart of the JobStat system is a monthly report that summarizes monthly and year-to-date outcomes on key measures, including the caseload reduction rate; employment placement, employment retention, and earnings gain rates; and the universal engagement and federal work participation rates. Much like a school report card, the report scores counties on their performance on each indicator and overall. It includes a summary table on one page, supplemented with additional graphic displays of the data. The JobStat system incorporates a formal process to review the report and discuss strategies for improvement. Local managers are required to meet monthly with state staff to discuss their Job Center's performance on each JobStat indicator.
The city of Baltimore adopted all of the underlying concepts of the JobStat system, but uses an expanded and localized management system, called CenterStat, to monitor its performance. Like JobStat, the system consists of monthly reports and meetings, but the outcome measures are more detailed than those in JobStat. For instance, while JobStat reports the universal engagement and federal work participation rates, CenterStat provides all of the elements that feed into the calculations. These elements include the total number of TANF cases; the percentage that were engaged (and among those, the percentage that were engaged in federally countable work activities, the percentage that were engaged in state-defined activities, and the percentage of cases that were closed in the month); the percentage of cases subject to and exempt from the federal work participation rate requirement; the percentage counted toward the federal work participation rate; and, among those not counted, the percentage that were participating for 0, 1-20, 21-24, and 25-29 hours per week, and the percentage participating for 30 or more hours per week but not enough of them in federally countable activities. CenterStat provides data for each of the city's eight local service centers.
Utah's Participation Report provides information to track the participation rate at all levels, from the state to individual case managers. Data come from the state's Your Online Data Access system, which contains detailed client- and program-level information for a variety of programs (including TANF, the Food Stamp Program, and Workforce Investment Act programs). The report format resembles the dashboard of a car, with one gauge for each region of the state. The four dials on each gauge represent different participation rate calculations: (1) the year-to-date rate based on planned hours, (2) the year-to-date rate based on verified hours, (3) the monthly rate based on verified hours, and (4) the future rate needed to meet the required 50 percent rate. If a user selects a region, the report displays a set of dashboard gauges for each office within the region. Selecting an office provides a set of dashboard gauges for each team of case managers, and selecting a team will display gauges for each case manager.
At the case manager level, the Participation Report provides easy access to detailed participation information for each recipient and produces both actual and planned activities and hours. This information allows case managers to: (1) determine whether or not each recipient met his/her federal work participation requirement; (2) identify participation in activities that does not count toward the work participation rate; (3) address discrepancies between planned and actual hours for each recipient; and (4) determine whether recipients have exceeded limits on job search, vocational education, or excused absences. The report also allows office supervisors to compare the participation rates of individual case managers. The state's regional directors hold case managers accountable for achieving a 50 percent rate for their own caseloads; this participation target is included in each case manager's performance plan and a corrective plan can be drawn up for staff not meeting the rate.
Many TANF agencies rely on vendors that is, private non- or for-profit agencies to provide services to TANF applicants and recipients through formal contractual arrangements. Vendors that provide case management and employment and training services play a large role in helping states meet their work participation rate. One way to hold vendors accountable for helping to meet the rate is to tie all or part of their payment to achieving specified outcomes.
In recent years, several states and localities have shifted from cost-reimbursement or fee-for-service contracts to performance-based contracts that hold vendors accountable for achieving specified results. Some agencies that already had performance-based contracts in place modified their performance indicators to include work participation rates. In a typical pay-for-performance structure, vendors are paid a set amount for each client who accomplishes specified milestones (such as participating in federally countable activities for at least 30 hours per week) or a set amount for achieving specified global outcomes (such as a 50 percent work participation rate for the vendor's caseload). This system is designed to motivate vendors to focus on achieving desired outcomes. Some contracts also build in additional incentives or bonus payments for exceeding minimum expectations. Below we provide short descriptions of the performance-based contracts three counties have put into place in an effort to help increase their work participation rates.
Montgomery County, Maryland uses a system of graduated payment points to motivate its employment services vendor to focus on encouraging each recipient to achieve maximum participation. The contract specifies a series of milestones for clients to accomplish; the closer the milestone is to the goal of meeting the federal work participation rate requirement, the higher the vendor's payment is for each client that meets that milestone.
For instance, in November 2004, the state instructed counties to require non-exempt TANF recipients to participate in activities for 40 hours per week. To encourage the vendor to focus on the 40-hour requirement, Montgomery County pays the vendor the highest amount for each client who participates for 40 hours per week throughout the month $500 per client. For each client the vendor engages in fewer than 40 hours per week, the county pays less than half that amount $205 per client. Other payment points and amounts in the county's contract with its vendor include: $120 for completion of orientation and assessment, $70 for issuance of a child care voucher, $580 for employment placement, $303 for 30-day employment retention, $311 for 180-day employment retention, and $180 for placement in a job with access to health insurance through an employer.
In addition, bonuses keep vendors focused on meeting state and federal participation requirements. If the county exceeds the 50 percent federal work participation rate, the vendor receives a bonus equivalent to the difference between the $205 payment and the $500 payment for each client who can be counted as meeting the federal work participation rate but who is participating for fewer than 40 hours per week.
Erie County, New York uses performance-based contracts to pay its vendors based on the average participation during each quarter. Vendors are paid the full amount of their contract for maintaining a 75 percent quarterly work participation rate. The payment amount is reduced by 15 percent for achieving a 65 percent quarterly average work participation rate, by 25 percent for achieving a 55 percent rate, and by 50 percent for a 45 percent participation rate or lower. Vendors may refer nonparticipants back to the TANF agency after five days of inactivity and after a warning letter has been sent to the recipient. Anyone referred back to the TANF agency is removed from the vendor's work-participation rate calculation, allowing providers to earn the full payment. Vendors are encouraged to refer non-participating recipients back to their case manager quickly so the case manager can institute special efforts to re-engage them, if necessary. Each of the county's vendors has achieved a 60 to 90 percent participation rate.
Davis County, Utah. As discussed in Section I above, the TANF agency in Davis County, Utah entered into a performance-based contract with Davis Behavioral Health (DBH) a large mental health treatment provider to provide supported employment services to TANF recipients with mental health disabilities. The TANF agency pays DBH up to $4,000 per client in increments designed to encourage DBH to help clients progress. Progress is defined primarily as an increase in hours of participation. The agency pays DBH $1,000 after providing supported employment services to a client for three months; $1,000 after providing services for six months on the condition that the client's work total work hours increased in the second three-month period over the first three-month period; $1,000 for providing services for nine months, on the condition that total work hours increased in the third three-month period over the second three-month period; and $1,000 for every client who maintains verified employment with DBH or outside employment for at least 30 hours per week for four consecutive weeks. Each TANF client at DBH has a mental health therapist who must approve any increase in assigned hours of participation, which typically results from consultations between DBH and TANF agency staff. Thus, DBH cannot increase a client's assigned hours solely to receive additional payments.
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The policies that guide states' TANF programs vary from state to state. Thus, at the time the DRA was enacted, each state was operating under a unique policy framework. In some cases, states chose to change some of their policies in order to meet higher work participation rates. Because there are many policies that define a state's TANF program, only a systematic survey would establish the extent to which states made policy changes in order to meet the effectively higher work participation rates. We do know, however, that some states, either because they anticipated that they would need to meet higher rates, or in response to the DRA, have made changes to their earned income disregard and sanction policies or procedures. Higher earned income disregards help states to meet the effectively higher work participation rates by increasing the number of working families who continue to be eligible for TANF benefits. More stringent sanction policies (such as full-family sanctions) help states meet higher rate requirements by removing from the caseload recipients who are not participating in work activities. Procedural changes often aim to engage recipients who may need more assistance or encouragement to meet their work requirements. Below, we describe ways in which some states have changed their earned income disregard or sanction policies and procedures with an eye toward achieving higher work participation rates.
When TANF adults find employment, earned income disregard policies determine which families continue to be eligible for TANF benefits and for how long. Since the majority of TANF recipients who met their work requirement before the DRA was enacted did so through paid, unsubsidized employment, expanding the number of working families on TANF provides a relatively easy way for states to increase their work participation rate, although there are some important cost considerations. In an effort to keep more working families on the TANF caseload, at least eight states expanded their earned income disregards. Some states extended the number of months for which recipients were eligible for the existing disregard; others increased the amount of the disregard, extending eligibility to some recipients who start out in better jobs and may not have been eligible for TANF benefits under the lower disregards. Both approaches keep working families on the caseload longer. Below, we present four examples of how some states have changed their earned income disregard policies.
Alabama. Prior to the DRA, Alabama disregarded 100 percent of recipients' earned income for three months. After the DRA, they extended the 100 percent disregard to six months.
Mississippi. Prior to the DRA, TANF recipients who found employment were eligible for a 100 percent disregard for three months. Like Alabama, Mississippi extended its disregard to six months, but limited the extension to families who were employed within 30 days of TANF approval or of starting a job search program.
Nevada. Prior to the DRA, Nevada offered a 100 percent disregard to working families for three months and a 50 percent disregard for the next nine months. To continue to provide TANF assistance to more working families, the state instituted a more gradual reduction of the disregard. Families still are eligible for a disregard over the course of 12 months, but the amount of the disregard is now 100 percent in the first through third months, 85 percent in the fourth through sixth months, 75 percent in the seventh through ninth months, and 65 percent in the tenth through twelfth months.
New Jersey. Until recently, working families in New Jersey were eligible for a 100 percent disregard for the first month, followed by a 50 percent disregard for an unlimited period. Now they are eligible to disregard 100 percent of earnings for one month, 75 percent for the next six months if they are working at least 20 hours (or if they have a state waiver of 20 hours due to a disability) and 50 percent for all subsequent months that they continue to be eligible for TANF.
Sanctions, (that is, financial penalties for noncompliance with program requirements) may influence the work participation rate in one of two ways. First, sanctions may encourage recipients who are not inclined to participate in program activities to do so. In this case, a state's work participation rate will be higher than it would be in the absence of sanctions because the numerator of the rate will increase. Second, when gradual or immediate full-family sanctions are applied to noncompliant recipients, those cases are eliminated from the TANF caseload (thereby removing them from the denominator of the TANF work participation calculation). Sanctions also may influence the participation rate indirectly if information about work requirements and penalties for noncompliance leads some people never to apply for assistance in the first place, encourages some recipients to comply with work requirements so as to avoid being sanctioned, or makes it more likely that some will leave the TANF program on their own.
In recent years, many states have changed the core component of their sanction policy the effect of a sanction on the TANF cash grant (that is, whether it is reduced and by how much or whether it is terminated and when). All states that have modified their sanction policies have moved to a more stringent model that is, from a partial- to a full-family sanction, or from a gradual full-family to an immediate full-family sanction. Other components of sanction policy that states have changed include: (1) the length of time a sanction must remain in place, (2) what a family must do to "cure" the sanction to resume full receipt of benefits, (3) the consequences for multiple acts of noncompliance, and (4) how a TANF sanction affects receipt of food stamps and Medicaid.
States also have made changes to procedures directly or indirectly related to sanctions. Examples of procedural changes include: (1) implementing new outreach and service strategies to encourage noncompliant recipients to begin participating and to reduce the likelihood that a sanction is ever imposed, (2) implementing strategies to impose sanctions more quickly, and (3) implementing new initiatives to re-engage already sanctioned clients in program activities. The second strategy may be particularly useful in states with full-family sanctions to ensure that noncompliant clients do not remain on the caseload and in the denominator of the participation rate any longer than necessary. The third strategy may be particularly useful in states with partial sanction policies so clients can be brought into compliance and be included in the numerator of the federal work participation rate even while in sanctions status.
Below, we provide descriptions of two states that made changes to sanction policies and two localities that made changes to sanction procedures. Most program administrators and staff in the sites perceived the changes they made in these areas as improvements that will contribute to increased participation rates. However, little or no data exist to provide evidence of the effectiveness of these changes.
Texas Shift from a partial to full-family sanction. In September 2003, Texas shifted from a partial to full-family sanction with strict requirements for "curing" the sanction. Prior to 2003, failure to comply with work requirements resulted in a benefit reduction equal to the entire adult portion of the grant. Repeat acts of noncompliance had the same effect on the TANF grant but were subject to progressively longer minimum sanction periods. The new policy requires termination of the full TANF grant for one month for all clients who fail to meet the required work activity hours specified in their employment plan. During that month, clients remain on the caseload in sanction status. After a second consecutive month of noncompliance, Texas drops these families from the TANF rolls. Staff decide who should be sanctioned, and can choose not to sanction a recipient who is participating but not for the total number of required hours. To cure a sanction, clients must perform one month of work activities, and, to return to TANF after being dropped from the rolls, clients must complete 30 days of work activities within 40 days of their TANF eligibility interview.
Utah Increased penalties for multiple sanctions and enhanced protections for clients. In 1994, using federal waivers, Utah began using a gradual full-family sanction to encourage clients to participate. In 2006, Utah restructured its sanction policy by decreasing the time it takes to impose a sanction and increasing the stringency of the penalties for repeat sanctions. Previously, all sanctions had resulted in a $100 grant reduction for two months followed by case closure for continued noncompliance. Now, first sanctions result in a $100 reduction in cash assistance for one month followed by case closure for continued noncompliance. Second sanctions result in immediate case closure for at least one month, and all subsequent sanctions result in immediate case closure for at least two months.
To balance the increased stringency of its sanction policy, Utah also initiated a two-phase problem-solving process to allow clients to identify and resolve participation issues before sanctions are imposed. The first phase is a meeting between the client, case manager, and a social worker; the second is a case conference with the client and a wider variety of staff and partners, such as child welfare agency staff, employment service providers, probation officers, and mental health therapists. Drawing in the additional professionals gives more perspectives on how best to assist the client in resolving participation issues and identifies available supports. It also ensures that several people review a case before it is sanctioned off TANF, which amounts to a check on the decisions of case managers, who have considerable discretion in initiating the sanction process.
Los Angeles County, California Home visits to encourage compliance planning. California requires all noncompliant clients to attend a meeting to determine whether a good cause exemption is applicable and, if not, to develop a written plan to bring the client back into compliance. The compliance plan is distinct from the client's original employment plan in that it specifies the activities in which the client must participate to avoid a sanction. It usually includes the activity in the original employment plan that is associated with the client's noncompliance. However, it also may include additional or alternative activities that may be more appropriate for the client or that may be useful for the client's continued participation. In Los Angeles County, clients are notified by mail that a home visit will take place one day after the scheduled meeting if the client does not attend. County staff believe that the mere notification of a possible home visit seems to "shock" clients into complying. Most clients develop a compliance plan after receiving the notice, thus eliminating the need for a home visit. The county also implemented state-mandated time constraints to ensure that home visits (and the conciliation process in general) are efficient and effective. As soon as a case manager notes in the county's management information system that a client is noncompliant, a sanction clock starts. If the case manager does not stop or reset the clock, the system automatically imposes a sanction 21 days later. Thus, the 21-day clock keeps staff and clients focused on completing the compliance planning process in a timely manner.
Suffolk County, New York Efforts to re-engage noncompliant clients after imposition of a sanction. Suffolk County contracts with a local social service agency to re-engage sanctioned clients in program activities. Agency staff meet with clients in a first sanction to explore the reasons for noncompliance, help ameliorate the conditions that led to the sanction, and encourage clients to re-engage in program activities. All meetings with the agency are a condition of continued eligibility; failure to participate in a meeting results in TANF case closure.
Program administrators use a contractor in this capacity because they and their staffs believe community-based organizations will be more successful than TANF case managers in motivating sanctioned clients to comply because clients may perceive the organization as a more committed advocate for their needs. County administrators also believe that TANF and employment service program staff do not have time to delve into personal issues with clients, while a contracted agency can concentrate more intensely on this task. Suffolk County also contracts with a local social service agency to meet with clients in a second or subsequent sanction status to try to assess the situation and determine whether they are, in fact, immediately employable. After a home visit, the agency refers immediately-employable clients to a temporary employment agency for job placement. Use of a temporary agency to place sanctioned clients into jobs is mutually beneficial; the temporary employment agency increases its volume of business and the TANF agency and its clients gain access to employers.
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Acknowledging that a heterogeneous group of families turns to TANF for support, some states decided to reevaluate their existing strategies for serving low-income families and considered whether new programs were warranted. A critical component of these deliberations was assessing how best to allocate funds from the TANF block grant, state funds used to meet their MOE requirement and state funds not used to meet the MOE requirement to maximize their chances of meeting the required federal work participation rate requirement while continuing to give families the range of opportunities in place prior to the DRA.
For example, some states wanted to continue to allow some individuals to pursue higher education while others wanted to have more flexibility to address the needs of families living with a disability or experiencing multiple personal and family challenges. States also saw this as an opportunity to provide additional support to working families. While some states decided to expand their earned income disregard, others decided to create new programs explicitly designed to address the needs of working families. Based on their previous experience, many states knew they could not meet the 90 percent work participation rate for two-parent families. Rather than face potential penalties, they opted to serve those families through a new program outside of the TANF system. Another issue for some states was the length of time it took for new TANF recipients to become engaged in work activities, so they created new job search programs in which TANF applicants could participate prior to coming onto the TANF rolls.
Below, we profile three new types of programs states created to serve certain families outside TANF: (1) worker supplement programs, (2) temporary support programs, and (3) solely state-funded programs.
Worker supplement programs provide additional income support to working families, keeping them on the TANF caseload longer than if the supplement had not been in place. From a federal perspective, participants in these programs are TANF recipients because they are funded with either TANF or TANF MOE dollars. However, from a state perspective, they often operate entirely separate from the state's regular TANF program. In some cases, these programs are delivered through mechanisms other than cash assistance and may include a broader range of services aimed at helping recipients stay employed and advance to better jobs. Nearly 20 states have implemented or will soon implement new worker support programs, and two states are actively considering whether or not to implement such a program.
The primary benefits of these programs are that they help states to achieve higher work participation rates by keeping working families on the TANF caseload longer and they provide extra cash and non-cash support to working families. However, because families stay on the TANF caseload longer, they make caseloads higher than they would be if such programs did not exist, potentially affecting a state's eligibility for a caseload reduction credit. If states use only MOE dollars to fund the income supplements, the months during which the payments are received do not count toward a recipient's federal lifetime limit and recipients are not subject to TANF child support assignment and retention rules. In order to maintain a distinction between working families receiving work support payments and other TANF recipients, some states track and report participation separately and count recipients of their worker supplement programs as part of the TANF caseload only for federal reporting purposes.
The worker supplement programs typically are targeted to TANF recipients who are meeting their TANF work participation requirement and become ineligible for TANF benefits because their earnings are too high. A few states also are planning to extend their TANF income supplements to working families with children receiving food stamps and who are not receiving TANF. In most states, eligible families receive a flat grant or a portion of their current TANF grant for a specified period.
The programs states have created vary on several dimensions, including: (1) the amount of cash assistance provided, (2) the length of time for which assistance is provided, (3) whether any noncash assistance or services are provided, and (4) the mechanism through which the additional income and other support is delivered. While states may have considered multiple factors in designing their programs, many of their final decisions have been driven by cost constraints. Below, to demonstrate the range of state approaches, we provide four examples of programs states have implemented or are planning to implement to increase their work participation rates by providing additional assistance to working families.
Arkansas Work Pays. Families in Arkansas who have received TANF payments within the last six months are eligible to receive monthly cash assistance payments of $204 per month for up to 24 months through the Arkansas Work Pays program. The program was implemented in July 2006 and is limited to 3,000 participants. To be eligible, families must be working at least 24 hours per week, must be meeting the work participation requirement, and must have income under 100 percent of the federal poverty level. Once in the program, families can continue to participate as long as their income is below 150 percent of the federal poverty level (up to the 24-month maximum). In addition to the monthly cash payment, participants are eligible to receive job retention and exit bonuses (received at the end of 24 months for meeting work requirements for 21 out of 24 months and for earnings exceeding the federal poverty level) totaling $3,000. They also receive case management services that focus on job retention and career advancement planning. While participants are working they may be eligible for help with educational and work-related expenses, and child care and transportation assistance. They also are eligible for other existing programs targeted to working families (for example, Individual Development Accounts and financial credit counseling).
Washington WorkFirst Career Services Program. In November 2007, Washington State created the Work First Career Services (WFCS) program to help employed families leaving TANF. The program is administered by the Employment Security Department, which is separate from the TANF agency, and is targeted to families working 30 hours or more per week in an unsubsidized job who have received TANF or a Diversion Cash Assistance (DCA) payment within the previous two months. Each adult in the family who meets the eligibility criteria may receive his/her own payment and services for up to six months. Program participants are eligible to receive up to $650 in cash payments and bonuses over the six-month period following the closing of their TANF cases or receipt of DCA. Recipients are eligible for a monthly payment of $50 (a total of $300 over six months); a $150 enrollment bonus; two bonuses, of $100 each, for completing a career services assessment (in month four) and an employment planning interview (in month six). In addition to cash payments, the program provides wage progression services designed to help participants move to better jobs and job retention services designed to help them keep their current jobs. In order to maintain their eligibility for the full six months, participants must remain employed for 30 hours per week and not return to TANF.
Utah Family Employment Program (FEP) Transitional Cash Assistance (TCA) and Extended Services. In May 2007, Utah created a new program option, TCA for FEP/TANF leavers who: (1) have received FEP benefits for at least one month, (2) are employed for an average of 30 hours a week per month, and (3) have verified their income and hours in the month following the closure of their FEP case. Self-employed individuals are eligible as long as their monthly earnings divided by the federal minimum wage equals at least an average of 30 hours per week per month. Two-parent families also are eligible as long as each parent meets the 30-hour work requirement. Eligible families receive their full TANF benefit ($474 for a family of three) for two months and 50 percent of their benefit in the third month. TCA eligibility is limited to once in a 24-month period. Since the program is funded with MOE dollars, the months of cash assistance covered by the TCA do not count toward the federal TANF or Utah lifetime limit. Families who receive a TCA benefit also may receive 24 months of case management and 6 months of transitional child care. In addition, they may be eligible for discretionary grants to cover specific work expenses (such as uniforms, tools, or car repairs).
Vermont Reach Ahead. During the 2007-2008 session, the Vermont Legislature created Reach Ahead, a new program for employed former TANF recipients. The program was created to assist TANF recipients who have recently become employed to maintain their employment and to promote greater family stability. To be eligible, recipients must have received TANF within the last six months, be meeting their TANF work requirement, meet the financial eligibility guidelines for the Vermont Health Access program (a health insurance program for uninsured individuals whose income is at or below 75 percent of the federal poverty line after deductions), and be a current recipient of food stamp benefits. The program was implemented for single-parent families on October 1, 2008. Subject to the appropriation of additional funds, the program will be expanded to two-parent families by April 1, 2009.
Program benefits will be provided in the form of food assistance equal to $100 per month for the first six months of family eligibility and $50 per month for the seventh through the twelfth months. The additional state-funded food assistance money will be added to a participant's electronic benefit transfer (EBT) account. The food assistance may be used to purchase eligible food items as defined in the federal food stamp rules and is disregarded for purposes of determining food stamp eligibility and the amount of food stamp benefits. Families who receive the assistance are not required to assign child support to the state and all child support received by the family is disregarded as income. If needed, participants can receive individualized case management services, support services, and referrals to assist them in maintaining self-sufficiency for the 12 months in which they are receiving the food assistance.
Prior to passage of the DRA, as a part of their efforts to shift the focus of their welfare programs to employment, many states implemented initiatives to divert program applicants from the welfare rolls, usually through lump sum payments or applicant job search requirements. After the passage of the DRA, some states created new diversion programs that provide short-term support to TANF applicants through programs other than the state's TANF cash assistance program.
These programs, sometimes referred to as precursor or pre-TANF programs, are of two types: (1) job search programs that aim to help applicants find employment quickly while providing assistance to meet their immediate needs, and (2) crisis stabilization programs that aim to help families meet their immediate needs while simultaneously developing an individualized long-term plan. Regardless of the type of program, participation is short-term, restricted to 4 months in a 12-month period. Because they are short-term, states have deemed them "non-assistance" programs for the purposes of TANF.
These programs are funded with federal TANF and state MOE dollars. Should the recipients of these short-term benefits later become TANF recipients, the time spent in these programs does not count toward a family's lifetime TANF time limit. Recipients of "non-assistance" are not considered TANF recipients and, therefore, are not included in the calculation of a state's work participation rate. (Many states, however, make them subject to the same work requirements as TANF recipients.)
In May 2008, HHS provided guidance to the states on short-term assistance programs that may require some states to restructure or redefine their programs. The guidance is specifically directed to "non-assistance" diversion programs created by some states that appear to be providing "assistance." In the guidance, HHS clarifies that to be considered "non-assistance," programs must: (1) be designed to deal with a specific crisis situation or episode of need, (2) not be intended to meet recurrent or ongoing needs, and (3) not extend beyond four months. In order to be considered "non-assistance," programs must meet all three criteria. While the guidance does not prohibit states from operating such programs, if programs do not meet the definition of "non-assistance" participants in them must be included in a state's TANF or Separate State Program (SSP) MOE caseload. If they are included in one of these caseloads they will be included in the work participation calculation.
Below, we describe three temporary support programs, two that were created before and one created after the passage of the DRA. Information on these programs was collected during the early part of 2008 so these descriptions do not reflect any changes states may have made in response to the HHS guidance, which was effective on October 1, 2008.
Minnesota. Minnesota implemented the Diversionary Work Program (DWP) in July 2004, about 18 months before the passage of the DRA. Minnesota created the DWP to engage families more quickly in job search activities and to allow TANF applicants to look for work without having the time count toward their 60-month time limit. All applicants, except those excluded by state statute, participate in the DWP program. (Individuals who are excluded are primarily those who have been deemed not ready to work, such as individuals with a disability.) Applicants can receive support from the DWP for up to four months. DWP participants are eligible for benefits up to the maximum TANF grant they would receive, but the amount provided depends on each participant's needs. Most payments are made as vendor payments to pay a family's bills, such as rent or utilities. A family with no shelter costs is eligible for a cash payment of $70 per person per month. Applicants also are eligible for transportation and child care benefits. Individuals who find employment while in the program are eligible for the same benefits as TANF recipients who find employment.
Hawaii. Hawaii's temporary support program started as a pilot program in 2005, prior to the DRA passage. In addition to getting applicants engaged in work activities quickly, the program was designed to delay entry into TANF so families would not use up their limited months on TANF. All TANF applicants, except those who are completely exempt from TANF work requirements, are required to participate in the program, and they must begin participating within 48 hours after their application is approved. (TANF applicants are not aware that the program is separate from TANF.)
Participants' work requirements are the same as if they were on TANF and they are eligible for the same amount of cash assistance. However, they receive a cash payment only if they fulfill their work requirement. They must participate for two weeks before they can receive any cash assistance, and after the two weeks, they receive a monthly payment for up to four months. Benefits are authorized for one month at a time. If they stop participating for a month or two, they do not receive any cash assistance for that month. Participants are eligible for child care, transportation and all work supports provided to TANF recipients. At the end of the four months, families still needing assistance are transitioned to TANF. The transition is seamless and program participants don't know they are moving from one program to another. Once families move to TANF, they are no longer subject to the month-to-month benefit determination.
Delaware. Delaware's temporary support program is targeted to TANF applicants who have a short-term medical crisis that prevents them from working, and to those with a long-term medical disability that limits employability. The program is designed to help individuals with short-term medical crises stabilize their condition and to help those with long-term medical disabilities begin the process of becoming eligible for SSI or SSDI, which may be better suited to their needs than TANF. In order to participate in the program, applicants must provide documentation showing they are unable to work due to medical disability. Once approved for the program, participants are required to participate in activities consistent with their capabilities. These are outlined in an individualized contract of mutual responsibility. Participants who do not comply with those requirements are referred to the TANF program, where they are subject to the same work requirements as all TANF recipients. Participants are eligible to receive cash assistance and other supports needed to stabilize the current situation for up to four months. If the situation is not resolved by the end of the four months, participants are transitioned to a solely state-funded program.
In order to protect themselves from potential penalties for not meeting the required work participation rates, some states have created new solely state-funded programs, removing from the TANF caseload classes of families with very little chance of meeting their work participation requirements. States targeted these programs to three groups of recipients: (1) two-parent families, (2) recipients living with a disability, and (3) recipients attending four-year colleges. Some solely state-funded programs were newly created, while in other cases, existing separate state MOE-funded programs were redefined as solely state-funded programs, with the primary change being that the state dollars used to fund the programs were no longer counted toward a state's MOE requirement. In some cases, solely state-funded programs may be more of an accounting strategy to avoid fiscal penalties than a work strategy to help low-income families move toward self-sufficiency. For example, some states developed new procedures for using their automated systems to apply a set of decision rules to determine which cases should be paid with federal TANF, state MOE or state non-MOE dollars. In states that chose this latter strategy, program eligibility and participation requirements are the same, so typically neither workers nor recipients are aware of the funding source and who is and is not counted in the TANF work participation rate calculation. Many of these programs are in the early stages of implementation. Below, we provide descriptions of four solely state-funded programs that have been implemented.
Oregon State Family Pre-SSI/SSDI Program. In December 2007, Oregon implemented a solely state-funded program targeted to TANF applicants or recipients who may be eligible for SSI or SSDI. This is a voluntary program in which participants receive a grant that is higher than their TANF grant; a family of three can receive a maximum grant of $637 in the solely state-funded program compared to $485 in the state's TANF program. Recipients are required to sign an agreement that, if they are approved for SSI, the state may recoup payment from the Social Security Administration (SSA) for any benefits they receive from the state while the application is pending. The program is staffed by a state coordinator and 15 disability specialists, many of whom are experts in the SSI application process. The program replaces an SSI advocacy program that the state had operated for almost 20 years.
The new program differs from the earlier one in several important ways: (1) participants receive cash payments funded solely with state funds, (2) the payments are higher than the TANF grant they would have received, (3) staffing for the program was increased from 7 to 15 positions, (4) the staff positions were upgraded to enable the state to hire and retain highly qualified staff, and (5) the program is now managed by a state coordinator.
TANF applicants and recipients are referred to the program by a TANF case manager. Through an initial intake interview, the disability specialist makes a determination as to whether the recipient is likely to be eligible for SSI or SSDI. If so, the individual is given the opportunity to enroll in the program; enrollment is voluntary. Most recipients who enroll have mental health conditions, and a small number have low cognitive abilities or physical disabilities.
While in the program, participants are required to cooperate with the SSI eligibility determination process. They have the option to participate in any employment programs the department offers, but they are not required to do so, and they are eligible for any supportive services that enable them to participate in work or treatment activities. Program participants must be recertified every six months. Families participate in the program until they are deemed eligible for SSI, they are denied SSI benefits, or they voluntarily withdraw from the program. Most participants receive an initial decision on their SSI application within 60 to 90 days, but the appeal process that many participants go through takes two to three years. The primary goal of the program is to reduce the time it takes participants to get into the SSI program. Recipients were moved from the state's TANF program so they would not count negatively against the state's work participation rate.
Maryland Solely State-Funded Programs. Prior to the passage of the DRA, Maryland had implemented two separate state-funded programs, one targeted to two-parent families and one targeted to TANF recipients living with a disability that is expected to last for longer than 12 months and who are applying for SSI. Participants in both programs receive the same benefits as they would if they received TANF benefits.
Two-parent families are required to participate in work activities for a total of 40 hours, 30 of which must be in federally countable core activities. Two-parent families who receive federally funded child care assistance are required to participate for a total of 55 hours, 50 of which must be in federally countable core activities. The total-hours requirement applies to the two parents in the family unit; it can be met by one parent or split between them.
By state law, TANF applicants or recipients living with a long-term disability cannot be required to participate in work activities. They are, however, required to submit an application for SSI and to cooperate with the Disability Entitlement Advocacy Program (DEAP) that was created to help individuals with disabilities through the SSI application process. As in Oregon, program participants are required to authorize the Social Security Administration to reimburse the Maryland Department of Human Resources for any benefits they receive during the application period. If recipients do not submit an SSI application and do not cooperate with the DEAP program, they are required to participate in work activities and are subject to the same sanctions as all other TANF recipients.
West Virginia Works Separate State Two-Parent Families Program and Separate State College Program. During the 2007 legislative session, West Virginia amended its state code to create two new solely state-funded programs, one targeted to two-parent families and one targeted to students enrolled in post-secondary courses leading to a two- or four-year degree. For both programs, the state created two new revenue accounts, the West Virginia Works (WVW) Separate State Two-Parent Program Fund and the WVW State College Program Fund. Expenditures authorized include wage reimbursements to participating employers (for subsidized employment), cash assistance identical to TANF benefits, payments for support services, employment-related child care payments, transportation expenses, and administrative costs directly associated with operation of the program.
The two-parent program includes all two-parent families. Each parent is required to participate in work activities for 35 hours, 30 of which must be in federally countable core work activities. If the two-parent family receives federally funded child care assistance, together the two parents are required to participate for 55 hours, of which 50 hours must be in federally countable core activities.
The college program is targeted to TANF adults attending post-secondary courses leading to a two- or four-year degree and who are not participating in vocational education training. West Virginia state law allows any TANF recipient to participate in any education activity, even if it does not count toward the federal work participation requirement. In fact, participants attending college cannot be required to participate in more than 10 hours of federally defined work activities. Participants in college programs must be making satisfactory progress as determined by the institution in which they are enrolled. The new solely state-funded program was created so that WVW would be in compliance with current state law requirements and recipients pursuing educational programs would not negatively affect the state's work participation rate.
Minnesota Family Stabilization Services (FSS). Minnesota began implementing the FSS program in February 2008. The program was created to provide counties with greater flexibility to work with TANF recipients who are not making significant progress toward self-sufficiency and applicants who are not likely to progress toward self-sufficiency. The program is targeted to recipients or applicants living with a disability (for example, developmentally or learning disabled or mentally ill recipients deemed unable to keep a job) and others who face substantial personal and family challenges. Families who have received an extension of the federal time limit, legal non-citizens residing in the United States for less than 12 months, families with a domestic violence waiver, and families caring for a child or other household member with a disability are among those eligible for the program. The goal of the program is to stabilize and improve the lives of families at risk of long-term welfare receipt.
Counties have considerable latitude in how to implement the program, but they are required to use a case management model. Case managers are required to develop a family stabilization plan that includes an assessment of each participant's strengths and barriers to self-sufficiency and identifies the services, supports, education, training, and accommodations needed to reduce or overcome those barriers in order to enable the family to achieve self-sufficiency. Participants receive the same amount of cash assistance that they would have received under TANF. They also are eligible for child care and transportation assistance, if it is included in the family stabilization plan. All recipients are required to participate in the activities outlined in their plan and can be sanctioned for failure to do so. The plans are individualized and may include only a few hours of activity, especially for families with multiple or more serious challenges. In some cases, workers may work with families to transition them to SSI, while in others they may develop a plan to help them find employment.
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The DRA changes were enacted to encourage states to engage more TANF recipients in countable work activities. Because states face substantial financial penalties if they do not meet the required work participation rates, many have reevaluated their policies, procedures and service delivery approaches and have implemented new strategies aimed at achieving higher rates. While some states have focused directly on new efforts to provide more work opportunities to TANF recipients, others have implemented approaches that aim to improve the effectiveness of existing strategies (for example, holding employment service contractors accountable for achieving higher work participation rates). Still others have changed existing policies in an effort either to encourage greater participation in work activities (for example, changing sanction policies and procedures) or to keep more working families on the TANF caseload (for example, expanding earned income disregard policies or implementing new worker supplement programs). Finally, some states have decided that TANF is not well-suited to helping some families and have created alternative assistance programs for certain types of families some within the TANF system and some outside of it. Because states have made very different choices about how to meet the higher rates, the composition of the TANF caseload may become more varied across states than it was prior to the passage of the DRA. Any efforts to assess the impact the DRA changes have had on the TANF caseload will have to take into account the fact that eligibility rules for TANF are quite different in some states since passage of the DRA than they were prior to its passage.
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1. Information on unpaid community service programs can be found in Practice Brief #1, "Providing Paid Employment Opportunities to Participants Engaged in Vocational Education Programs: Examples from Denver, Colorado; Kentucky; and California," which can be accessed at http://aspe.hhs.gov/hsp/08/TANFWPR.
2. Through the caseload reduction credit, a state's work participation requirement for all families and for two-parent families is reduced by the number of percentage points by which the state's caseload falls below 2005 levels for reasons other than eligibility rule changes. States may not count caseload declines resulting from a tightening of income and resource limits or enactment of time limits, full-family sanctions, or other new requirements that deny assistance when a family fails to meet program requirements. Prior to the DRA, the base year for the credit was 1995.
3. Core activities include: unsubsidized employment, subsidized private sector employment, subsidized public sector employment, work experience, on-the-job training, job search and job readiness assistance (with limitations on duration), community service programs, vocational educational training (with limitations on duration and the proportion of recipients who can participate), and providing child care assistance to an individual in a community service program. Non-core activities include: job-skills training directly related to employment, education directly related to employment (in the case of a recipient who has not received a high school diploma or its equivalent), and satisfactory school attendance at a secondary school (for those who have not completed high school).
4. More details on work experience programs can be found in Practice Brief #3, "Providing Unpaid Work Experience Opportunities for TANF Recipients: Examples from Erie County, New York; Montana; and Hamilton County, Ohio," which can be accessed at http://aspe.hhs.gov/hsp/08/TANFWPR.
5. In an effort to streamline program administration, PRWORA provided the states with the option of operating a Simplified Food Stamp Program (SFSP) for households whose members are receiving TANF assistance. The simplified program was designed to create conformity between TANF and the Food Stamp Program by merging the programs' rules into a single set of requirements for individuals receiving both types of assistance. PRWORA also allows the states to implement a limited, or "mini," simplified program in which only the food stamp work requirement is replaced by TANF's work requirement. A SFSP or mini-SFSP must be in place for states to use the combined value of food stamps and TANF benefits to determine the number of hours a recipient can be required to work in an unpaid work experience or community work experience placement.
6. More details on providing work opportunities for TANF recipients who are participating in vocational education programs can be found in Practice Brief #1, "Providing Paid Employment Opportunities to Participants Engaged in Vocational Education Programs: Examples from Denver, Colorado; Kentucky; and California," which can be accessed at http://aspe.hhs.gov/hsp/08/TANFWPR.
7. More details on using data to manage and encourage participation in work activities can be found in Practice Brief #2, "Using Data to Monitor and Improve the Work Participation of TANF Recipients: Examples from New York City and Utah," which can be accessed at http://aspe.hhs.gov/hsp/08/TANFWPR.
8. The fair hearing affirmation rate refers to decisions by a judge that uphold the action taken by a Job Center. The win rate includes affirmations as well as client defaults, client withdraws, and when a judge determines the Job Center acted appropriately at the time, but the client's situation has changed. A fair hearing is lost when a Job Center action is reversed by the judge, or a Job Center withdraws the issue at the fair hearing. These rates are calculated as the proportion of issues affirmed/won by the Job Center; each fair hearing case can consist of more than one issue.
9. Maryland distinguishes the universal engagement requirement from the federal work participation requirement. All TANF recipients are subject to the universal engagement requirement-that is, they are required to participate in at least one federally countable or state-defined activity for at least one hour per week. Only some recipients, however, are subject to the federal work participation requirement.
11. The HHS guidance can be found at http://www.acf.hhs.gov/programs/ofa/policy/pi-ofa/2008/200805/PI200805.htm
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The Deficit Reduction Act (Title VII, Subtitle A), http://frwebgate.access.gpo.gov/cgi-bin/getdoc.cgi?dbname=109_cong_bills&docid=f:s1932enr.txt.pdf
Final TANF Regulations, http://www.acf.hhs.gov/programs/ofa/law-reg/finalrule/finalru.htm
General Strategies to Increase Work Participation Gardiner, Karen, Mike Fishman, Mark Ragan, and Tom Gais. "Local Implementation of TANF in Five Sites: Changes Related to the Deficit Reduction Act." Fairfax, VA: The Lewin Group; and Albany, NY: The Nelson A. Rockefeller Institute of Government, March 2008. http://www.acf.hhs.gov/programs/opre/welfare_employ/local_impl/reports/five_sites_reduction/five_sites_reduction.pdf
Martinson, Karin, and Pamela A. Holcomb. "Innovative Employment Approaches and Programs for Low-Income Families." Washington, DC: The Urban Institute, February 2007. http://www.acf.hhs.gov/programs/opre/welfare_employ/inno_employ/index.html
Strategies for TANF Recipients Living With a Disability Derr, Michelle K. "Providing Specialized Personal and Work Support." Washington, DC: Mathematica Policy Research, Inc., February 2008. http://www.acf.hhs.gov/programs/opre/welfare_employ/identify_promise_prac/reports/personal_employ_support/personal_employ_support.pdf
Derr, Michelle K., and LaDonna Pavetti. "Creating Work Opportunities." Washington, DC: Mathematica Policy Research, Inc., February 2008. http://www.acf.hhs.gov/programs/opre/welfare_employ/identify_promise_prac/reports/creating_wk_opportunities/creating_wk_opportunities.pdf
Pavetti, LaDonna, Michelle K. Derr, and Emily Sama Martin. "Conducting In-Depth Assessments." Washington, DC: Mathematica Policy Research, Inc., February 2008. http://www.acf.hhs.gov/programs/opre/welfare_employ/identify_promise_prac/reports/conducting_in_depth/conducting_in_depth.pdf
Sama Martin, Emily, LaDonna Pavetti, and Jacqueline Kauff. "Creating TANF and Vocational Rehabilitation Agency Partnerships." Washington, DC: Mathematica Policy Research, Inc., February 2008. http://www.acf.hhs.gov/programs/opre/welfare_employ/identify_promise_prac/reports/creating_tanf_vocational/creating_tanf_vocational.pdf
Using TANF Sanctions to Increase Work Participation Rates Kauff, Jacqueline, Michelle K. Derr, LaDonna Pavetti, and Emily Sama Martin. "Using Work-Oriented Sanctions to Increase TANF Program Participation." Washington, DC: Mathematica Policy Research, Inc., September 2007. http://www.acf.hhs.gov/programs/opre/welfare_employ/sanction_pol/reports/sanction_pol/sanction_pol.pdf
Universal Engagement and Working With the Hard-to-Employ Kauff, Jacqueline, Michelle K. Derr, and LaDonna Pavetti. "A Study of Work Participation and Full Engagement Strategies." Washington, DC: Mathematica Policy Research, Inc., September 2004. http://aspe.hhs.gov/hsp/full-engagement04
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This practice brief is one of a series describing state and local Strategies for Increasing TANF Work Participation Rates. The Deficit Reduction Act of 2005 (DRA) resulted in significant increases in the effective work participation rates that states must achieve. The series of briefs is designed to assist state and local officials in thinking about strategies that might aid them in meeting federal work participation requirements in their TANF programs.
The briefs in this series draw on information gathered from case studies of nine programs and describe approaches adopted by selected states and/or local offices that might be of interest to other program administrators. None of these programs has been rigorously evaluated, so their effectiveness is unknown. The U.S. Department of Health and Human Services does not specifically endorse any of the approaches described in this series. All briefs in the series can be accessed at http://aspe.hhs.gov/hsp/08/TANFWPR.
This brief was prepared by Mathematica Policy Research, Inc., (MPR) under contract to the U.S. Department of Health and Human Services, Office of the Assistant Secretary for Planning and Evaluation and the Administration for Children and Families.
For further information on this practice brief, contact LaDonna Pavetti at 202-484-4697 or at firstname.lastname@example.org.