Setting the Baseline: A Report on State Welfare Waivers. Section 1: Work Requirements

06/01/1997

AFDC Requirement: States could require recipients who did not fall into one of the specified exemption categories to participate in the Job Opportunities and Basic Skills Training (JOBS) program, which provided education, training, and work experience activities. Individuals were exempt from JOBS participation if they: were ill, incapacitated, or aged; were under age 16 or in school full-time; were already working at least 30 hours per week; were in the second or third trimester of pregnancy; were needed in the home to care for an ill or incapacitated family member; resided in an area where the program was not available; were providing care to a child under age 3 (or age 1 at state option); or were providing care to a child under age 6 and child care was not available. Individuals caring for a child under age 6 could not be required to participate more than 20 hours per week. Individuals who did not meet one of these categories, and who did not have good cause for not participating, were considered JOBS mandatory.

States were required to provide the following JOBS activities: educational activities, including high school or the equivalent, and ESL, job skills training, job readiness, and job development and placement; states were also required to offer at least two of the following work activities: job search, on-the-job training, work supplementation, or community work experience. Post-secondary education was an optional component. States could require up to eight weeks of job search for new applicants, and up to eight weeks of job search per year for recipients. Within this framework, states were allowed to develop their own policies regarding what activities to assign recipients. States' practices varied widely, with some states encouraging participants to take advantage of the educational opportunities offered in order to improve their employment prospects, while other states focused on immediate job search and placement in the components that most resemble work. Changes in these policies did not require a waiver of federal regulations; in general, they did not even require an amendment to the state plan.

Individuals who were assigned to JOBS activities could be sanctioned for failure to participate. The sanction was the elimination of the participant's needs from the grant amount. This sanction was applied according to the following schedule: for the first failure to participate, the sanction lasted until compliance; for the second instance, the sanction lasted until compliance or for three months, whichever was longer, and for any subsequent instances, the sanction lasted until compliance, or for six months, whichever was longer.

States were not required to serve all non-exempt individuals. In FY 95, states were expected to achieve a participation rate of 20 percent of JOBS mandatory individuals, for an average of 20 hours per week. By law, states could be penalized for failure to meet this participation rate by a reduction in the matching rate on JOBS dollars. However, in practice, although some states did not meet the participation standard, no state was ever penalized. The Secretary of HHS waived the penalty, as allowed by law if the state made a good faith effort to meet the standard and submitted a plan for improvement.

Waivers: As stated in their waiver requests, many states believed that the exemption criteria from JOBS were too broad. They therefore applied for waivers to make JOBS work activities mandatory for more AFDC recipients. The waivers granted that affected JOBS exemptions are summarized in Table I.A. The most commonly requested waivers required parents of young children -- in some cases children as young as 12 weeks -- to participate in JOBS. These waivers were motivated by the fear that parents would be excused from participation for long periods of time, and would find themselves with no labor market experience or skills when their children finally reached school age. In addition, some people argued that very few working parents have the opportunity to take a year off of work to care for their children, and that it is therefore unreasonable to expect that welfare recipients should be allowed to do so. A number of waivers also allowed states to require parents of pre-school age children to participate for more than 20 hours per week.

Other waivers reduced the exemptions for pregnant women to those with a medical reason not to participate and tightened the criteria for an exemption based on a disability. Some waivers allowed teen parents attending high school and people working 30 hours per week to be considered as JOBS participants. These waivers allowed the states to provide such individuals with supportive services, but also allowed them to impose JOBS sanctions for nonparticipation. A few states eliminated virtually all categorical exemptions, and left it to caseworker discretion as to whether individuals should be required to participate in JOBS.

A concern expressed by many states was that the sanctions for non-compliance were not strong enough to motivate unwilling individuals to participate, or were too difficult to impose. States therefore applied for waivers to increase the severity of their sanctions or to reduce the administrative burden associated with imposing sanctions. Table I.B summarizes the waivers that were granted which affected the sanctions for failure to meet JOBS participation requirements. As shown in this table, 23 states received waivers which allowed them to impose full-family sanctions (i.e. termination of the entire family's AFDC grant) after a continued period of non-compliance. States also received waivers which allowed them to impose sanctions for longer periods than under the standard AFDC program.

Relatively few waivers affected the services provided under JOBS since the AFDC regulations gave states substantial flexibility without requiring waivers. One of the most common waivers was one that lifted the limit on the number of weeks during which a recipient could be assigned to job search. A number of states received waivers from the Department of Agriculture allowing food stamps as well as AFDC grants to be diverted in order to subsidize employment of people receiving assistance under both programs.

TANF Provision: TANF removes most of the federal requirements regarding exemptions and required activities, and replaces them with a more stringent participation rate requirement (25 percent in FY 1997, rising to 50 percent by FY 2002). The only remaining federal provisions are: a) single parents of children under age 6 who cannot find child care can not be penalized for failure to meet work requirements; and b) states can exempt single parents of children under age 1 from the work requirement and can disregard these individuals in the calculation of participation rates for up to a total of 12 months.

In general, TANF encourages states to require work (unsubsidized or subsidized) and training that is closely linked to work, rather than to place recipients in long-term educational activities. Although no specific types of education or training are absolutely mandated or forbidden, the limitations on what may count towards the participation rate are likely to shape the work-related services that states offer to recipients. For example, under TANF, no more than four consecutive weeks of job search, and no more than six weeks overall, can be counted towards the participation rate. States are not forbidden to spend money on job search programs beyond these limitations, but this increases the risk of being unable to meet the participation rate goals. (Note, however, that caseload reductions can be counted towards the participation rate, so if a longer period of job search is effective in placing recipients in well-paid jobs, it still might help the state meet the participation rate goals.) Similarly, no more than 20 percent of individuals can be counted as participating based on participation in vocational education or secondary school for teen parents. States that do not meet the participation rate goals will be penalized by a reduction in the amount of their block grant.