Giving Noncustodial Parents Options: Employment and Child Support Outcomes of the SHARE Program. The Welfare-To-Work Grants Program

10/01/2003

The WtW grants program is one of several major, federally funded initiatives aimed at helping welfare recipients and other low-income parents to move into employment. In 1997, the Balanced Budget Act (BBA) authorized the U.S. Department of Labor (DOL) to award $3 billion in grants to states and local organizations. The grants were intended to help the hardest-to-employ recipients of TANF and noncustodial parents of children on TANF to prepare for employment, find jobs, stay employed, and advance in the job market. The WtW grants program built on the earlier enactment, in 1996, of the Personal Responsibility and Work Opportunity Reconciliation Act, which created the work-focused, time-limited TANF program. TANF was designed to move people off the welfare rolls and into employment quickly, whereas WtW grants provided resources targeted to state and local efforts to help particularly disadvantaged individuals who were likely to have great difficulty making that transition.

DOL distributed the $3 billion in funding that Congress provided for the WtW grants program in stages during 1998 and 1999. Three-quarters of the funds were allocated to states based on a formula that considered the states' shares of the national poverty population and TANF caseload. One-quarter was distributed competitively on the basis of applications that states, local agencies, and nonprofit organizations submitted to DOL. Competitive grants were awarded in three rounds, which were announced in May 1998, November 1998, and October 1999. Formula and competitive funds may be used for a range of activities designed to move WtW participants into employment, and grantees have substantial flexibility in designing WtW services.

WtW Eligibility Requirements for NCPs. The BBA required WtW grantees to spend at least 70 percent of their funds on specific target groups, one of which was NCPs. In order to qualify for WtW under the 70 percent criteria, however, NCPs had to meet two requirements. First, they had to have two of the following three legislatively specified barriers to employment: (1) no high school diploma or GED and low reading or math skills, (2) substance abuse problems, and (3) poor work history.(2) Second, they had to have a child with a custodial parent who was a long-term TANF recipient or within one year of reaching the TANF time limit (or have a child in a child-only TANF case who met the same criterion). WtW grantees also could spend up to 30 percent of their funds on TANF recipients or other NCPs with "characteristics associated with long-term welfare dependency," such as being a teenage parent, having a poor work history, or being a high-school dropout.

As the WtW programs were implemented, it became clear that the congressionally defined eligibility criteria were slowing enrollment and limiting participation (Perez-Johnson et al. 2000). The WtW eligibility rules were therefore amended in November 1999. The amendments left intact the requirement that 70 percent of WtW funds be spent on a specific category of participants, but they broadened this category to make it easier for both TANF recipients and NCPs to qualify for WtW services. To qualify for WtW after the amendments, NCPs had to (1) be unemployed, underemployed, or having difficulty making child support payments; (2) have minor children who were receiving or were eligible for TANF, had received TANF during the past year, or were receiving or were eligible for assistance under the Food Stamp, Supplemental Security Income, Medicaid, or State Children's Health Insurance Program; and (3) enter into a personal responsibility contract under which they committed to cooperating in establishing paternity, paying child support, and participating in services to improve their prospects for employment and paying child support.

End of the WtW Program. Congress did not intend to provide ongoing support for WtW interventions. WtW grantees originally were given three years from the date they received their awards (both formula and competitive) to spend their grants. Grantees, in turn, often passed these requirements on to the providers with whom they subcontracted for WtW services. Ultimately, Congress extended the period over which WtW funds may be used to a total of five years  that is, through 2004.(3) However, no additional appropriations for WtW have been made or are planned.

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