Report on Alternative Outcome Measures: Temporary Assistance for Needy Families (TANF) Block Grant . What Rates are States Required to Meet?

12/01/2000

The statutes governing the JOBS and TANF programs established target participation rates that states are required to meet. Both programs established an overall rate (which includes both single and two-parent families) and a separate rate for two-parent families. As shown on Table 1, both programs had target participation rates that increased over time, however, the target participation rates in the JOBS program were substantially lower. The target overall rate in JOBS increased from 7 percent in Fiscal Year (FY) 1990 to 20 percent in FY 1995, while in TANF it started at 25 percent in FY 1997 and increases to 50 percent for FY 2002. The differences in the rates between the two programs are not as dramatic for the two-parent rate. In JOBS, the two-parent rate increased from 40 percent in FY 1994 to 75 percent in FY 1998(1), while in TANF this rate started at 50 percent in FY 1997 and increases to 90 percent in FY 2000.

Table 1
Required Participation Rates in the JOBS and TANF Programs
    JOBS Program TANF Program
Year Overall Two-parent Families Overall Two-Parent Families
Year 1 7% 40% 25% 75%
Year 2 7% 50% 30% 75%
Year 3 11% 60% 35% 90%
Year 4 11% 75% 40% 90%
Year 5 15% 75% 45% 90%
Year 6 20% None 50% 90%

In both programs, states are subject to financial penalties if they do not meet the required participation rates. In JOBS, a states federal matching rate for the JOBS program could be reduced if it failed to meet the participation requirements. Under TANF, states face up to a five percent reduction in their TANF block grant and an increase in the maintenance of effort requirement (from 75 percent to 80 percent) for not meeting these requirements

While the statute governing the TANF program sets target participation rates, there is another provision in this law that affects the actual rate each state is expected to meet. This provision  known as the caseload reduction credit  allows states to reduce their participation rates based on declines in their TANF caseload. Specifically, participation rates are reduced by one percentage point for each percentage point that a states welfare caseload in the last fiscal year is below FY 1995 levels. Both the overall and the two-parent rate can be reduced by the caseload reduction credit; however, caseload decreases due to changes in federal law or in state-defined eligibility criteria do not count toward the credit. For example, a state that experienced a ten percent caseload decline between FY 1995 and FY 1997 would be required to meet an overall participation rate of 15 percent (rather than 25 percent) for FY 1997.

To date, the caseload reduction credit has had a significant effect on the participation rates states are required to meet. Table 2 shows the "adjusted target" for the overall rate  the participation rate that takes the caseload reduction credit into account  for each state in FY 1997 and FY 1998. As shown, as a result of the caseload reduction credit, in FY 1998, some states  such as Indiana, Wisconsin, and Wyoming  had their overall participation rate reduced to zero. Others  such as Alaska and Hawaii  only had a small reduction in the FY 1998 target participation rate of 30 percent.

Table 2.
TANF Overall Participation Rates, FY 1997-99
(in percents)
State FY1997 FY1998 FY1999
(Target Rate = 25 Percent) (Target Rate = 30 Percent) (Target Rate = 35 Percent)
Adjusted Target Rate Achieved Adjusted Target Rate Achieved Adjusted Target Rate Achieved
Alabama 17.1 42.3 5.0 38.9 0.0 37.4
Alaska NA NA 26.8 42.5 16.8 46.0
Arizona 16.1 26.9 8.7 30.2 0.0 32.1
Arkansas NA NA 16.6 19.4 6.0 23.7
California 19.5 20.6 17.7 36.6 8.5 42.2
Colorado NA NA 7.5 28.7 0.0 36.4
Connecticut 20.3 58.4 21.5 41.4 19.7 47.4
Delaware NA NA 9.4 26.2 0.0 24.9
DC 21.0 31.3 20.1 22.8 13.9 26.7
Florida 16.4 28.4 5.8 34.5 0.0 31.6
Georgia 18.7 20.6 6.1 29.3 0.0 17.6
Guam NA NA 30.0 12.4 35.0 16.1
Hawaii NA NA 28.1 30.0 23.1 41.1
Idaho NA NA 4.2 28.6 0.0 43.7
Illinois NA NA 13.6 37.7 6.1 60.4
Indiana 5.6 25.3 0.0 29.9 0.0 33.3
Iowa 14.9 52.8 9.1 56.9 4.7 54.8
Kansas 14.1 33.3 1.9 41.3 3.9 57.3
Kentucky 20.3 33.1 16.3 39.3 5.8 38.1
Louisiana 13.4 13.5 2.0 29.2 0.0 29.4
Maine 19.3 41.6 15.1 45.6 5.9 54.9
Maryland 16.3 18.3 3.1 12.7 7.2 11.2
Massachusetts 12.6 31.5 7.3 29.0 0.9 27.8
Michigan 13.3 41.1 5.2 49.2 0.0 43.8
Minnesota NA NA 17.0 30.6 13.7 36.9
Mississippi 16.3 17.2 3.7 25.2 0.0 27.0
Missouri 17.6 23.2 10.4 24.1 2.2 28.2
Montana 19.2 49.5 7.2 78.3 0.0 92.3
Nebraska 20.5 34.0 20.6 36.2 19.7 34.7
Nevada 20.0 31.2 6.0 34.5 1.1 34.8
New Hampshire 13.3 36.1 5.5 37.3 0.0 29.9
New Jersey 19.5 20.7 14.7 26.5 7.1 30.3
New Mexico NA NA 8.5 15.9 0.0 27.6
New York 19.6 27.9 15.0 37.5 8.3 36.3
North Carolina 15.1 25.9 10.0 14.5 0.0 16.0
North Dakota NA NA 10.7 31.5 0.8 31.7
Ohio 15.6 38.3 11.6 44.9 1.4 53.7
Oklahoma 11.6 27.8 0.0 35.2 0.0 42.9
Oregon 10.2 96.7 0.0 98.2 0.0 96.7
Pennsylvania NA NA 9.9 19.3 0.9 16.2
Puerto Rico NA NA 17.1 6.8 12.3 20.7
Rhode Island NA NA 19.3 27.5 22.0 28.8
South Carolina 18.4 38.9 19.0 42.7 6.7 44.7
South Dakota 20.4 44.8 11.2 39.2 1.6 46.5
Tennessee 20.3 38.6 2.0 43.2 0.0 41.1
Texas 14.6 19.4 5.2 25.2 0.0 27.3
Utah 13.7 39.6 2.5 39.8 2.2 44.0
Vermont NA NA NA NA NA NA
Virgin Islands NA NA 27.7 15.5 19.7 11.5
Virginia 15.6 17.3 6.8 27.5 0.0 41.1
Washington 22.0 24.0 21.1 48.5 12.9 40.3
West Virginia 15.0 18.3 19.2 33.4 0.0 25.6
Wisconsion 8.0 52.8 0.0 64.0 0.0 80.1
Wyoming 16.0 52.6 0.0 55.3 0.0 57.7
National Average   28.1   35.4   38.3

Table 3 provides this information for the two-parent rate. As with the overall rate, the caseload reduction credit has had a significant impact on the two-parent rates in some states. While some states still have to meet relatively stringent rates, in FY 1998, 10 states had their participation requirement for two-parent families cut to 10 percent or less (compared to a target rate of 75 percent).

Table 3.
TANF Two-Parent Participation Rates, FY 1997-99

(in percents)
State FY 1997 FY 1998 FY 1999
(Target Rate = 75 Percent) (Target Rate = 75 Percent) (Target Rate = 90 Percent)
Adjusted Target Rate Achieved Adjusted Target Rate Achieved Adjusted Target Rate Achieved
Alabama 35.8 31.5 NA NA NA NA
Alaska NA NA 68.6 36.8 66.8 44.8
Arizona 66.1 68.8 53.7 76.6 48.9 88.4
Arkansas NA NA 57.8 20.3 61.0 10.5
California 68.0 24.5 32.7 36.2 36.9 54.3
Colorado NA NA 15.1 25.7 44.9 41.2
Connecticut 70.3 90.6 66.5 73.2 NA NA
Delaware NA NA 54.4 23.7 NA NA
DC 48.2 14.0 30.1 22.5 23.3 19.5
Florida NA NA NA NA NA NA
Georgia NA NA NA NA NA NA
Guam NA NA 75.0 13.0 90.0 10.7
Hawaii NA NA NA NA NA NA
Idaho NA NA 0.0 22.5 20.6 44.0
Illinois NA NA 45.0 77.7 46.2 92.4
Indiana 35.1 35.2 20.1 32.8 32.3 41.4
Iowa 64.9 48.5 51.4 53.6 49.0 55.5
Kansas 44.0 33.7 23.2 44.2 56.9 64.9
Kentucky 50.8 51.9 37.5 52.4 17.6 46.6
Louisiana 5.7 15.4 0.0 38.1 33.5 43.1
Maine 61.7 50.5 35.3 49.9 23.6 51.0
Maryland NA NA NA NA NA NA
Massachusetts 52.1 71.1 44.6 73.3 55.9 66.4
Michigan 60.3 47.4 38.4 63.9 15.2 69.1
Minnesota NA NA 42.5 30.8 68.7 43.6
Mississippi 54.0 24.4 1.2 70.4 39.7 87.5
Missouri 21.7 47.8 0.0 34.9 0.0 29.8
Montana 69.2 82.1 52.2 86.4 45.2 87.0
Nebraska 61.2 42.0 53.1 39.5 74.7 53.8
Nevada 45.8 39.2 31.7 58.7 56.1 69.6
New Hampshire 21.9 46.0 1.6 44.6 8.0 31.6
New Jersey 55.8 25.2 NA NA NA NA
New Mexico NA NA 35.6 16.8 54.1 29.3
New York 61.1 63.6 38.5 58.8 23.1 58.4
North Carolina 56.2 45.5 55.0 30.9 45.1 30.3
North Dakota NA NA NA NA NA NA
Ohio 47.8 39.8 49.2 51.5 35.1 65.4
Oklahoma 36.9 16.1 4.2 31.4 NA NA
Oregon 46.8 98.3 9.8 95.2 38.5 96.1
Pennsylvania NA NA 26.3 21.8 20.7 24.9
Puerto Rico NA NA NA NA NA NA
Rhode Island NA NA 51.1 32.4 77.0 94.7
South Carolina 24.9 40.2 48.5 60.9 61.7 78.1
South Dakota NA NA NA NA NA NA
Tennessee 46.0 52.4 4.6 39.1 5.2 44.3
Texas 55.4 34.3 47.9 44.3 48.2 61.0
Utah 63.7 64.1 47.5 49.7 NA NA
Vermont NA NA NA NA NA NA
Virgin Islands NA NA NA NA NA NA
Virginia 65.6 19.4 51.8 26.5 NA NA
Washington 66.0 18.6 52.2 45.5 47.8 55.3
West Virginia 61.3 49.0 46.8 37.2 51.1 25.9
Wisconsin 39.9 51.3 0.0 39.2 20.1 55.8
Wyoming 54.9 63.9 4.9 65.8 0.0 90.7
National Average   34.3   35.4   54.7

Tables 2 and 3 also show the participation rates states achieved during the initial years of the TANF program (FY 1997 and FY 1998) for the overall and the two-parent rate, respectively. Table 4 shows the rates achieved during the last year of the JOBS program (FY 1996). As shown, under both JOBS and TANF, all states met the participation requirement for the overall rate (adjusted by the caseload reduction credit under TANF) in the years examined in this report.(2)  However, under both JOBS and TANF, states experienced much more difficulty meeting the more stringent two-parent rates. Under JOBS, roughly half of the states (26) met the two-parent requirements. Under TANF, 16 states met their adjusted two-parent rate in FY 1997 and 28 states met this rate in FY 1998.(3)

Table 4.
JOBS Overall and Two-Parent Participation Rates, FY 1996

(in percents)
State  Overall Rate
(Target Rate = 25 Percent)
Rate Achieved
Two-Parent Rate
(Target Rate = 60 Percent)
Rate Achieved
Alabama 56.1 35.9
Alaska NA 48.3
Arizona 49.4 55.4
Arkansas 20.1 29.3
California 27.1 39.0
Colorado 22.2 61.1
Connecticut NA 84.6
Delaware 14.4 21.4
DC NA NA
Florida 81.8 100.0
Georgia 40.8 71.4
Guam 20.0 16.9
Hawaii 21.1 8.1
Idaho 53.0 61.7
Illinois 29.4 67.8
Indiana 22.5 34.9
Iowa 37.5 75.1
Kansas 33.0 60.1
Kentucky 31.8 90.0
Louisiana 33.5 77.8
Maine 35.4 74.7
Maryland 26.1 34.6
Massachusetts 33.5 65.3
Michigan 29.5 51.5
Minnesota 25.3 38.4
Mississippi 24.6 11.6
Missouri 37.7 67.2
Montana 30.2 65.5
Nebraska 73.2 51.9
Nevada 29.6 67.8
New Hampshire 68.1 58.6
New Jersey 26.7 66.7
New Mexico 36.4 67.8
New York 27.7 54.2
North Carolina NA 18.0
North Dakota 52.2 75.6
Ohio 42.9 48.0
Oklahoma 29.6 24.6
Oregon 76.4 35.2
Pennsylvania 32.8 72.5
Puerto Rico 27.4 NA
Rhode Island 22.5 69.6
South Carolina 24.2 39.3
South Dakota 76.9 83.0
Tennessee 36.2 60.4
Texas 28.7 41.2
Utah 55.2 87.1
Vermont 22.0 60.6
Virgin Islands 14.8 NA
Virginia 34.8 23.7
Washington 65.8 49.7
West Virginia 26.1 25.8
Wisconsin 60.6 76.9
Wyoming 68.4 81.7
National Average 33.1 NA

Overall, while TANF requires higher levels of participation to meet both the overall and two-parent rate than required under JOBS, the participation requirement for TANF is moderated in many states by the caseload reduction credit. As explained in detail below, because of the differences in the way participation rates are defined under JOBS and TANF, it is very difficult to compare the participation rates achieved under JOBS to those achieved under TANF.