Exclusive commentary: current and former elected officials discuss TANF

Because the nation۪s welfare program, Temporary Assistance to Needy Families (TANF), is due to expire by October 2010, SPOTLIGHT has asked Governors, Mayors, and state legislators for their insights about the program۪s strengths and weaknesses in reducing poverty and improving opportunity in America.

Over a span of three weeks, United States Representative Jim McDermott (D-WA), Delaware Lieutenant Governor Matt Denn (D), and Delaware State Senator Liane Sorenson (R-6) are answering three questions, one each week, about TANF in the 21st century. This is their second set of answers, the first was posted last week.

Over the previous three weeks, Ohio Governor Ted Strickland (D), former Indianapolis Mayor Stephen Goldsmith (R), Savannah Mayor Otis Johnson (D), and former Wisconsin Governor Scott McCallum (R) answered their own set of questions. Their first, second, and third sets of answers can be read on SPOTLIGHT.

There has been an ongoing debate over how well TANF has served needy families. Less than half of families eligible for cash assistance receive it, and in 2007, one third of single mothers were neither working nor receiving welfare. In your opinion, what is the biggest challenge in ensuring TANF succeeds in helping the full range of eligible families and what, if anything, should be changed to help achieve this objective?

Representative Jim McDermott

TANF is supposed to help families make ends meet while a parent looks for employment, and I would like to see everyone on TANF leave the program for a well-paying job. But that goal got confused with simply reducing the number of people on the TANF rolls, which forced families out of the program regardless of their employment status. The message from the federal government to the states, the cap on program funding, and specific TANF policies such as the caseload reduction credit which reduces federal work rates in states that cut caseloads all pushed states to make cutting the caseload their primary goal. We need to change course and actually help low-income families rather than ignore them. To achieve that goal, we need policies that value poverty reduction over caseload reduction.

Representative Jim McDermott

Delaware Lieutenant Governor Matt Denn

These numbers are interesting. Do we know what the numbers were like prior to welfare reform in terms of what percentage of single mothers were working or receiving benefits? Without a context or a comparison, it۪s hard to respond or assess just what this 2007 number means. We know that one very significant result of welfare reform is that it dramatically increased the number of single mothers in the workforce. That said, this country, and Delaware is no exception, provides low cash benefits to the “deserving” poor. Deserving in this context are those who are working or who are unable to work. Able-bodied adults who do not comply with the rules lose benefits. Previous to October 2006, Delaware had a “three strikes and you۪re out” policy. That is, when an adult caregiver was non-compliant and sanctioned three times, the family lost benefits and could not be reinstated. The level of effort that poor people have to expend and still remain in poverty is overwhelming to many people. Although the system provides work supports, to some, the level of effort for so little gain is simply not worth it. Delaware recently changed the “three strikes” bar to benefit reinstatement and no longer has that particular policy. The policy now is that if the parent is non-compliant with the work expectations policy, the family is ineligible for benefits until the parent complies. .

With regard to changes, the federal TANF block grant begins with the limitation that it is funded at a fixed amount based on Aid to Families with Dependent Children (AFDC) allocations of the mid-1990s. Spending has shifted away from cash grants to supporting low income working families. For example, Delaware knew that as the welfare rolls declined, child care would increase. Delaware rolled welfare savings into funding for increased child care volume and expanding child care eligibility from 155 percent of the Federal Poverty Level (FPL) to 200 percent of FPL.

Work supports are much more expensive than cash grants and intended to be in place at higher levels of income, although some families lose these benefits before they are financially secure. States have worked to resolve many of the employment barriers for the TANF eligible group such as need for employment skills, transportation, child care, domestic violence support services, and mental health and substance abuse services. Other barriers to long-term and stable employment that are less amenable to direct intervention include the level of family and community support, single parents raising young children, hidden disabilities, and young motherhood.

Based on funding level alone, it cannot be expected that the TANF program can address all of these issues by itself. Collaboration across state and federal agencies must be enhanced to meet the goal of reducing the child poverty. In keeping with that theme during August of 2007, the Delaware Child Poverty Task force was created by executive order. The Task Force is tasked with developing a ten-year plan to reduce the number of Delaware children living in poverty by 50 percent and to establish recommendations for prevention and intervention services in order to promote the health, safety and well-being of Delaware۪s children and their families.

The current federal TANF rules are disadvantageous to families with a disabled parent. The federal rules hold these families to the same participation requirements as other more able families. This has created the need for states, such as Delaware, to establish separate state programs for these clients which cannot meet the federally mandated participation requirements. These families, while being served, are not included in TANF caseload counts. Reauthorization should ask disabled adults to participate up to their ability without penalizing states. If engaging everyone who is potentially eligible for benefits is a goal, than reauthorization should also address the incentives built into the participation rate calculation to reduce the rolls.

The lack of asset reserves puts many families at risk of entering poverty following a crisis such as loss of employment or a parent leaving the home. Delaware has recently increased the asset limits for TANF families with the hope that, as families build assets, they can continue to receive the support of the TANF program and can build the asset reserve necessary to weather crisis events. Additionally the increase in the asset limit ($10,000) allows clients to receive the support of the TANF program prior to using what little reserve they may have.

If “deservedness” continues to be a component of the national safety net, then ideas to support work more effectively and longer would seem appropriate. This could include stretching the Earned Income Tax Credit (EITC) over a broader income range and making the return more generous at the middle income range. Many states fund state refundable earned income tax credits. Working families with children could receive child care subsidies at higher levels of income and at lower cost to them. Federally, support for child care has remained relatively flat for the last ten years. All of these ideas are costly and none of them address the economic reality of wages paid and wages necessary to support families above the poverty level. What they do is target increased income support to that group that works and remains poor.

Delaware Lieutenant Governor Matt Denn

Delaware State Senator Liane Sorenson

The fact that TANF has not served all of the eligible parties is partially the result of families being unable to meet the work requirements to stay in the program. A looming challenge that TANF faces is proper job preparation in an increasingly competitive labor market due to the weak economy. TANF must continue to ensure that the wages yielded from employment are strictly greater than the monetary benefits from not working. In order to help serve more needy families, the subsidy for child care for low-income families should be adequate so that mothers are physically able to be trained for and keep a job. I have called for increasing the state subsidy for child care (Purchase of Care) in Delaware۪s TANF program, A Better Chance (ABC), and continue to feel that this measure is crucial to achieving the objective of broader program outreach.

Delaware State Senator Liane Sorenson

Jim McDermott represents Washington State۪s 7^th District in the U.S. House of Representatives. He was elected in 1988.

Matt Denn is the 25^th Lieutenant Governor of Delaware. He was elected in 2008.

Liane Sorenson is the State Senator for Delaware۪s 6th District. She was elected in 1995.