Setting the Baseline: A Report on State Welfare Waivers. Section 3: Penalties for Subsequent Births


AFDC Requirement: Under the AFDC rules, a family's grant amount was based on the payment standard for a family of a certain size. This means that if a family had a baby, thereby increasing the number of people in the family, the grant amount rose.

 Waivers: Some states have argued that this policy creates a perverse incentive for welfare recipients to have children, making self-sufficiency harder. Moreover, they note, other people who are working do not automatically receive raises when they have children. In response to this argument, 19 states applied for, and received, "family cap" waivers. These waivers allowed states to eliminate, or reduce, the increase in benefits upon the birth of an additional child after the family first began receiving AFDC. A related provision, adopted by some states with family caps and some states without, was eliminating or reducing the exemption from JOBS participation for caring for a young child, when the child was conceived while the family was on AFDC. According to some state proposals, this policy was adopted out of concern that some people might choose to have another child in order not to be subject to work requirements.

Under the terms and conditions of the waivers, family cap provisions did not apply to the first birth by a minor parent who was a dependent child on someone else's AFDC grant. Except in the first state to receive a family cap waiver, all such waivers indicated that the state would make an exception for children of rape or incest. The provisions otherwise varied in a number of details, as shown on Table III. One significant point of variation was that some states applied the family cap to any child conceived after the family began receiving AFDC, even if the family was not receiving any benefits during the month the child is conceived. Seven states specified that the families could keep all child support received in behalf of a child excluded from the assistance unit based on the family cap, and four allowed families to keep a larger portion of earned income in order to provide for the excluded child. The variations among plans are explained in more detail in the footnotes to Table III.

TANF Provision: TANF does not require states to base levels of assistance on the number of people in the family. States therefore have the flexibility to establish any form of family cap they desire, or none at all. States do not have to include the exceptions required as a matter of federal policy in the waivers. At least one state (Wisconsin) has proposed providing a fixed amount per participating adult, regardless of the number of children in the family.