Policy makers and others have suggested that cash assistance programs, particularly Temporary Assistance for Needy Families (TANF), can create a disincentive to marriage. Because eligibility for TANF is based on the definition of an “assistance unit” that can include some or all of the family members in a household, the disincentive also can apply to cohabiting two-parent families with or without children in common. There are two issues to consider:
- Whether those who are financially eligible are prevented from receiving benefits due to the presence of two parents in the household, and
- How assistance units are defined, and income and resources counted, for the purpose of determining eligibility
Under TANF, states have wide flexibility to define who is included or who is excluded from the assistance unit. For example, a state could, if it chose, include a non-custodial parent living elsewhere in the assistance unit, or it could require the needs and income of everyone living together to be one assistance unit, regardless of relationship. Generally, states have not yet used this wide latitude and for the most part have continued practices from the prior Aid to Families with Dependent Children (AFDC) program. State practices fall into three possible scenarios:
- Two parents living together have children in common. If paternity has been legally established, the incomes of both parents are counted in determining eligibility, regardless of whether the parents are married or cohabiting. The eligibility issue is not marriage per se but legal responsibility to financially support the child.
- Cohabitors do not have children in common. Under TANF, there are no federal anti-deeming provisions, so it is state policy that determines whether the income of the non-parent/step-parent would be used to determine a child’s eligibility.
- Cohabitors have some children in common, but not others. Under TANF, all children would be considered part of the same assistance unit and the income of the parent/step-parent would always be counted in determining eligibility.
We explored state changes to eligibility rules for two-parent families, marriage incentives in the TANF program, marriage promotion activities by TANF case workers, and child support arrearage policies. As Table 7 depicts, all but 12 states had an activity in at least one area.(42)
TANF eligibility for two-parent families. The 1996 welfare law gave states flexibility to shape their cash assistance programs, including the populations that could be served. Under the AFDC program, two-parent families faced strict eligibility rules, such as a recent work history test and the “100-hour rule” (the primary wage earner could not work more than 100 hours per month). States can expand TANF coverage to two-parent families by eliminating these rules, which serves to treat one- and two-parent families the same when determining eligibility. Thus, marriage in itself would not disqualify couples from TANF. Thirty-three states now base TANF eligibility solely on financial circumstances.(43)
Marriage incentives in the TANF program. Ten states provide specific marriage incentives to TANF recipients or introduced measures to do so.(44) Four states — Alabama, Mississippi, North Dakota, and Oklahoma — disregard all income from a new spouse (biological parent or stepparent) for three to six months. Tennessee disregards the income of a stepparent if it is less than 185 percent of the needs standard for the household, while New Jersey does so if household income does not exceed 150 percent of the poverty line. Maine offers the option to include or exclude stepparents in the TANF assistance unit, while Minnesota includes stepparents as eligible members in a TANF assistance unit. West Virginia adds a $100 incentive payment to the monthly cash benefit to married-couple families.
Mississippi and Washington introduced legislation that would have provided a lump-sum check to those who become disqualified from TANF due to marriage. The bills died in committee. Finally, Oklahoma combines the income of cohabiting couples when determining eligibility for welfare, perhaps discouraging cohabitation.
Marriage promotion in the TANF program. We found one example of state workers actively promoting marriage to the TANF population and other low-income groups. In Oklahoma, state workers are being trained to teach marriage skills and are encouraged to discuss marriage with their clients. According to Jerry Regier, former Secretary of Health and Human Services in Oklahoma, policy makers in seven other states have contacted him to learn about his state’s policy (not shown in matrix).(45)
Child support arrearage forgiveness. States can encourage marriage among unmarried parents by forgiving child support arrearages owed by the non-custodial parent to the state. If a custodial parent was on TANF, the non-custodial parent’s child support obligation would be owed to the state.(46) If the parents reunited, the state could forgive any back support owed. Two states, Tennessee and Vermont, have such policies. Tennessee forgives arrears owed by the father if he marries the mother of his children and continues to live in the household. Vermont forgives child support arrearages owed to the state if the biological parents are reunited.(47)