The WtW cost analysis is part of a comprehensive, congressionally mandated evaluation of this federal grants program. The National Evaluation of the Welfare-to-Work Grants Program includes three major components:
1. Descriptive Assessment of All WtW Grantees. Mail surveys of all grantees, conducted in 1998 and 1999, provided an overview of program designs and activities, target populations, characteristics of participants, and, when available, information on early placement outcomes. Visits to several dozen grantees before the first survey helped develop a fuller understanding of program variations and provided a basis for selection of in-depth study sites. Previously released reports document the findings from both national surveys and the early visits to selected grantees. (3)
2. Process and Implementation Study. In 1999-2000 and 2000-2001, two rounds of site visits were conducted to 11 grantee evaluation sites. Some sites were selected because of their innovative approaches, settings, or target groups, others because they were typical of the most common WtW interventions. The process visits included discussions with staff of WtW programs and related agencies, focus groups with participants, and program observations. The aim of the process and implementation study has been to identify implementation issues and challenges, as well as lessons for program implementation.(4)
3. Outcomes Analysis. In 10 of the 11 process study sites, a sample of WtW participants was enrolled. Follow-up data on these participants are being collected through surveys and administrative data. These data are being used to analyze participants' activities in the programs and their employment and social outcomes. The 10 grantee sites where such analyses are being conducted are called the "in-depth study" sites.
In addition, a special process and implementation study focuses on documenting welfare and employment systems operated by American Indian and Alaska Native grantees, the supportive services they provide, and how these tribal grantees integrate funds from various sources to help their members move from welfare to work.(5)
The original design for the national WtW evaluation called for impact and cost-effectiveness analyses based on a random-assignment experimental design. Such analyses were to be conducted in the in-depth study sites. Estimating the full costs of delivering WtW program services was an essential foundation for the proposed cost-effectiveness analysis. The impact and cost-effectiveness components of the WtW evaluation proved infeasible, however. The main barrier to conducting the impact study was difficulty finding grantees that were identifying more eligible candidates than they could serve (grantees with excess demand) a necessary precondition for random assignment. Without impact estimates, it was impossible to assess the cost-effectiveness of WtW programs.
A detailed analysis of the costs of WtW programs is still useful, however. The new time-limited nature of welfare assistance raises the stakes of participation in programs such as WtW for individual participants. It also makes it important to examine how fiscal and other resources are distributed to support the transition to employment and self-sufficiency. The goals of the WtW cost analysis were therefore redefined to focus on (1) understanding more fully how specific WtW interventions operated, and (2) exploring the cost implications of the alternative strategies or approaches used by WtW program operators. More specifically, the WtW cost analysis was restructured to address three descriptive and analytic objectives:
1. Describe the cost experiences of selected WtW programs
2. Compare program costs across grantees, sites, or program components
3. Identify factors that help account for cost variations within and across WtW programs and explore why and how these factors affect costs