Summary of President Bush's Proposal for Reauthorization of the Temporary Assistance for Needy Families (TANF) Program
On February 26, 2002, President Bush released a draft proposal for welfare reform.
Key Features of President Bush's Proposal
- TANF funding will be held at the same level for the next five years with no adjustment for inflation.
- The Child Care and Development Fund (CCDF) will be flat funded.
- Work requirements will be made tougher. States will be required to have 70% of their caseload working instead of the current 50% requirement.
- The work requirement for two-parent families will be made the same as the single parents requirements. However, the overall work requirements for TANF recipients is tougher.
- TANF recipients will have to be engaged in "activities" for 40 hours per week rather than the current requirement of 30 hours. At least 24 hours of this total must be in activities defined by the federal government, such as an actual job or minimum wage-exempt community service. The remaining 16 hours must be in state-defined activities such as job training, education, or other activities which state will define.
- Child well-being will be a part of the overall goals and purposes of TANF. States will be required to set out in their state plan how they intend to address this purpose and must indicate how they will measure their own performance in this area, including how a state addresses youth development.
Key Elements of President Bush's TANF Reauthorization Proposal
- Maintains the current funding level of $16.5 billion, plus the supplemental grant of $300 million a year.
- Redesigns the existing two state bonuses. Currently, $200 million is provided to states in the form of a high performance bonus. This bonus has been split between dozens of states based on their accomplishments in moving people to work and reaching other targets. A second $100 million bonus has been awarded to the top 4 or 5 states that reduced the out-of-wedlock birth rates for the entire state population.
Under the Administration's proposal, the high performance bonus is reduced to a $100 million. The $100 million in funds taken from that high performance bonus is combined with the out-of-wedlock reduction bonus to create a new $200 million federal matching fund that states can apply for to spend on marriage promotion. States can use TANF funds to provide this match.
- The Administration's proposal includes no increases in child care funding. Annual funding for the Child Care and Development Fund would remain at $2.7 billion in mandatory funds and $2.1 billion in discretionary funds for each of the next five years.
Current TANF law includes four purposes which determine how states can spend federal and state TANF funds. The Administration proposes that the four purposes be modified with the words, "to increase the flexibility of states in operating a program designed to improve the well-being of children." The fourth purpose is amended to emphasize strengthening marriage and promoting responsible fatherhood. States would be required to include explicit descriptions in state plans of state efforts to promote family formation and include numerical goals and annual state reporting of achievement in these areas.
State plans would also include performance goals. States would be required to indicate how they address each of the purposes of the TANF law. States will have specific numerical goals they must achieve. Included in these goals and outcomes are employment retention and advancement, youth development, use of faith-based organizations, and program integration.
- Current law requires states to have 50% of their caseload in federally-defined work. In addition, if a state chooses to serve two-parent families, these families are calculated separately and a state must have 90% of these families in federally-defined work. States can reduce both of these requirements when they receive a caseload credit, which is based on how much that state's cash assistance caseload has dropped since 1996.
The Administration's plan would increase the 50% work requirement by 5% a year until it reaches 70%. The proposal would eliminate over two years the existing caseload credit which states currently use to reduce their work requirements.
- Currently, TANF recipients must work 30 hours per week. Mothers with children under age six are required to work 20 hours. An individual meets this goal only if they are engaged in activities that are defined as "work."
The Administration proposes that TANF recipients must be engaged 40 hours a week in "activity." Twenty-four hours of that 40 hour total must be in work-related activities. Substance abuse treatment for three months over a two-year period can be counted as a work-related activity. If the 24 hours is in "work experience" or community service programs, recipients are exempt from the Fair Labor Standards Act including the minimum wage requirements. For the remaining 16 of the 40 hours, an individual must be engaged in activities defined by the state. The Administration proposes no changes to current law allowing states to exempt 20% of their caseload from the work requirements.
The Administration proposes no changes to the current law which dictates that no adult may receive more than 5 years of federally funded TANF assistance.
The Administration's proposal allows states to apply for "super waivers" with the goal of aligning programs administered by five different federal agencies: Health and Human Services, Labor, Housing and Urban Development, Education, and Agriculture. The federal government would respond to these waiver requests within 90 days.
The Administration's proposal continues the abstinence education grant at $50 million per year and requires a state match of $3 for every $4 of federal dollars. The proposal also increases the Community Based Abstinence Education grants from $40 million to $73 million per year.
The Administration's proposal encourages states to increase the amount of child support funds they pass through to a family. Currently, states are allowed to pass $50 through to families without having to reimburse the federal government. If states increase this amount from $50 to $100, the federal government will not require states to reimburse the federal government for its share of this cost. States are also encouraged to pass through all child support to families that have left TANF. The federal government will share in this cost. The Administration also proposes to toughen other child support requirements to force greater collection of outstanding child support orders.
The Administration's proposal simplifies some of the rules and deductions in determining food stamp benefit levels. This would increase food stamp benefits for some families.
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