House Bill Should Increase TANF Funding, State Flexibility, Expert Says and Spending

Lawmakers need to increase funding to the Temporary Assistance for Needy Families (TANF) program, the main federal safety net program that is reaching just a fraction of the families that are struggling to overcome the burdens of poverty, experts testified.

A major shortcoming of the draft bill is that it provides no additional funding for TANF even though the block grant has lost 30 percent of its value since its creation. In addition, the bill requires states to earn part of their existing block grant funds, imposes additional reporting requirements on states with no additional funding for those activities, and repurposes the Contingency Fund, which some states have used to fund regular TANF activities.

In testimony before the House Ways and Means Subcommittee on Human Resources, Center on Budget and Policy Priorities poverty expert LaDonna Pavetti addressed new draft legislation to reauthorize TANF. She explained that the legislation improves how TANF helps poor families and escape poverty, but does not go far enough.

TANF serves only 26 families for every 100 families in poverty; in a growing number of states, it serves fewer than 10 families for every 100 families in poverty, Pavetti said. The draft bill includes a few provisions that will lessen the incentive for states to avoid serving families in need or those with the greatest barriers, such as eliminating the caseload reduction credit and providing partial credit for recipients who do not participate for the full number of hours. But these do not go far enough.

In order to operate high-quality work programs, states need to devote more resources and to be freed from onerous reporting requirements that dampen rather than strengthen the quality of services provided. They also should be rewarded for improving program access. Better work programs will do little to reduce poverty if very few household heads have access to them.

Pavetti also emphasized why TANF reform is so sorely needed:

A whole generation of children has grown up under the current TANF structure — we should move forward expeditiously to ensure that the next generation has access to a more robust TANF program that both reaches more families in need and provides more meaningful education, training, and work opportunities that give families a reasonable chance of moving out of poverty.

“The problem is that TANF lacks a meaningful accountability measure on how effectively a state’s TANF program provides a safety net for very poor families, and the draft bill does not include one,” she said. “We suggest holding states accountable for adequate access to TANF benefits on a par with the two other performance measures (the work participation rate and the new outcomes measure).

The best way to achieve this would be to add a third accountability measure that specifically measures access to TANF and to attach similar consequences to state failures, she said.

At a minimum, Congress could instruct HHS to produce an annual report that measures access to the program; USDA’s annual report for SNAP program could be a model.

“TANF reform is long overdue,” she said. “Though the draft bill doesn’t go far enough, it provides a strong starting point.”

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