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State Legislatures Magazine: April 1999

Editor's Note: These articles appeared in the April 1999 issue of NCSL's magazine, State Legislatures. To order copies or to subscribe, contact the marketing department at (303) 364-7700.

Window of Opportunity for Welfare Reform

Keep an Eye on Your Agencies

Getting a Job and Keeping It

Moving Up the Ladder

Leaving Addiction Behind

Rethinking the Role of Fathers

Put It in a Different Pot

Expanding the Safety Net

How Can You Use the Money?

Window of Opportunity for Welfare Reform

Looking for good ways to spend your welfare money? Caseloads have dropped so fast that by the end of the year most states will have at least one-quarter of their welfare money left. Most of it—several billion dollars—belongs to the states, but sits in the federal treasury until states spend it.

It must be used to help poor families—it can’t be used for prisons, bridges or schools. But states don’t have to stick to their existing welfare programs. They can create new services to address long-standing problems such as learning disabilities and drug abuse or expand the number of families that get child care or transportation help.

Already states risk losing some of that money. Federal budgetmakers are even now looking at the money states are not spending and wondering if they gave them too much.

The speed at which families left the welfare rolls took most policymakers by surprise, so the challenges facing welfare reform are not the ones originally anticipated.

• Recipients who are still on welfare have greater barriers to finding jobs—substance abuse, domestic violence, low literacy and limited work experience.
• Those recipients who do get jobs often need help keeping them, and they need help getting better jobs that will help them support their families without welfare.
• Some rural areas and city centers are struggling to find enough jobs and adequate transportation so clients can get to available work.
• Working poor families and former recipients need help with child care, transportation and other services to avoid going on welfare.
• Many poor families cannot depend on child support because the absent fathers do not have jobs or earn too little to keep up with payments.

States are in a strong position to respond to these challenges. They have money—both federal Temporary Assistance to Needy Families (TANF) block grants and the state maintenance of effort (MOE) money that must be spent to draw down the full block grants. They also have flexibility to design new programs. Federal officials say that until final rules are announced, no spending will be disallowed if it results from a reasonable interpretation of the federal law.

"What we do now will determine in large part the long-term success of welfare reform," says Olivia Golden, assistant secretary in the federal administration for children and families. "Now is the time to think and act creatively."

Legislators can play an active role in developing new programs and making sure that everything possible is being done. Under the federal law, legislatures appropriate both state and federal welfare money. Several states have authorized specific initiatives in statutes. Other states use provisions in their appropriations bills.

KEEP AN EYE ON YOUR AGENCIES
Take a look at agency spending. In many states, agencies are lagging far behind legislative appropriations. They have been slow to implement new programs or spend money on designated services. Also examine agency efforts to make sure the legislature’s intentions are carried through.

States are in uncharted territory, and they are looking for direction and ideas on how to invest money. There is no checklist to which states can refer—now more than ever they must tap into ideas from their colleagues and surrounding states. Several states have been innovative in designating how welfare money can be spent:

• Florida and South Carolina operate educational programs to reduce teen pregnancy.
• Washington gives incentives to caseworkers who help recipients find high wage jobs and stay employed.
• Maine and Wyoming run separate state programs to allow qualified recipients to go to college.
• New Mexico gives money to its commission on the status of women to develop services focused on women facing domestic violence, substance abuse and limited work experience.
• Wisconsin gives a state earned income tax credit to families who left welfare for work.
• Florida establishes college tuition funds for children of welfare families.
• New York and Arizona help low-income families buy cars.
• New Mexico gives a $100 monthly housing subsidy to families who do not receive federal assistance.

These ideas and the ones discussed in the following articles give states a sampling of ways to tackle the remaining challenges of welfare reform.

Getting a Job and Keeping It

THE PROBLEM
Welfare recipients sometimes can’t keep jobs. Learning to cope with work and family obligations and time management, in addition to developing new skills that will help enable them to retain their job and advance in the workplace, becomes too much for them.

NEW APPROACHES
Services for people after they land a job help them keep their jobs, avoid coming back on welfare and help them earn higher wages. States can use their welfare money to:

• Offer child care and transportation to low income working families.
• Give former recipients continued job training and access to additional education.
• Monitor the progress of newly employed recipients.
• Match former recipients with mentors who are able to offer advice and encouragement on handling work and family responsibilities.
• Provide basic adult education courses and English as a second language.
• Offer telephone hot lines to answer callers’ questions about services available to them and contacts for support services, such as child care providers.
• Provide mediation between employers and employees.
• Provide counseling for coping with the work environment.
• Provide job search assistance for those who lose jobs.

THE INNOVATORS
Arizona, Florida, Maryland, Oregon, Tennessee, Washington, Wisconsin

THE COSTS
Washington appropriated $41.5 million from the Temporary Assistance to Needy Families grant for its WorkFirst Post Employment Services Program. The program has reached more than 8,400 people who have left the welfare rolls and offered such services as education, training and child care. To date, there have been 2,250 referrals to community college, 1,500 referrals to better paying jobs, 600 referrals to welfare case managers, and 500 have had help writing resumes.

The Arizona Legislature appropriated $5.6 million from the Child Care and Development Block Grant in FY 1999 for expanded child care for low income working families who are at or below 165 percent of the poverty level. The program provides day care for 3,100 children.

Maryland appropriated $160,000 in FY 1998 to its Project Retain program (44 percent are TANF funds). When a person goes off welfare, he gets an exit interview and a packet of information that tells him how and where to get help. Project Retain also operates a call center to answer questions about the services available. Some 269 people were helped in the first six months of operation.

THE OPINIONS
One of the biggest obstacles facing welfare recipients, particularly single parents, is child care. We need to give people the right tools to move from welfare to being a successful member of society. Child care services are a big step in the right direction.—Representative Kathi Foster, member, Children and Family Integrated Delivery Systems Committee, Arizona

Using Welfare Money

Did you know you could use federal and state welfare money to . . .

• Provide job training and child care to families who have never been on welfare?
• Continue child care and transportation for families after they leave welfare?
• Give a state earned income tax credit to low income working families?
• Help noncustodial fathers get jobs so they can pay child support?
• Establish college tuition funds for children of welfare families?
• Pay for vocational training after families leave welfare?
• Give incentives to caseworkers who help recipients find careers instead of dead-end jobs?
• Help low income families get cars?

Moving Up the Ladder

THE PROBLEM
State officials have misconceptions about how education can fit into a "workfirst" strategy. Welfare recipients and poor families need skills that can help them get jobs that pay a living wage and provide regular health insurance to avoid a return to the welfare rolls. States can spend welfare money on helping poor families get better skills so they can advance in the job market.

Federal law does not put direct restrictions on education and training, but state officials have to think creatively about how to combine education with their emphasis on work. The only limit imposed by federal law is that states can count work training as work for 30 percent of their participants, including teen parents.

NEW APPROACHES
States can help welfare recipients and poor families get the training and skills they need to advance in the job market. States are using welfare money to:

• Pay for tuition and fees for recipients who attend school and work.
• Develop state programs that focus on education and work. These programs don’t count in participation rates or federal time limits, but spending does count toward the state’s maintenance of effort.
• Provide needed support services like child care and transportation for recipients in education and work.
• Train former recipients or low income individuals to gain better skills.
• Combine classroom training, mentoring and real-life work experiences to help participants get basic skills and a job history.
• Work with community colleges and vocational schools to develop curricula that are sensitive to the needs of welfare recipients.
• Identify training programs that lead to high wage earning jobs instead of low paying service jobs.
• Work with local employers to design programs in specific career fields and structure curricula around advancement.

THE INNOVATORS
Arizona, Colorado, Florida, Maine, Michigan, New York, Washington

THE COSTS
The Michigan Legislature appropriated $4 million of Temporary Assistance to Needy Families funds to operate their Enhanced Technical Vocational Training program as a way to help poor working parents gain skills in computer-related fields. Arizona appropriated $1.9 million to pay for tuition and fees for welfare recipients to get advanced training. Wisconsin appropriated $1 million to provide $500 matching grants to former recipients who want additional training.

THE OPINIONS
It is important to acknowledge the importance of both education and work in moving recipients off of welfare and keeping them off. Internships have played a vital role in preparing many of us for the working world, and they are now being used with similar success for welfare recipients.—Senator Joe Holland, chair, Social Services Committee, New York

Leaving Addiction Behind

States are using welfare funds to combat substance abuse problems.

THE PROBLEM
It’s hard to get a job and almost impossible to keep it if you’re addicted to drugs or alcohol. And in the relatively new world of welfare to work, recipients who are substance abusers pose a particular challenge for states.

Federal studies estimate that up to 35 percent of the welfare population is addicted to drugs or alcohol. And these are the people most often sanctioned and dropped off the welfare rolls. Those who stay jeopardize a state’s ability to meet strict federal work participation requirements, which could result in financial penalties.

NEW APPROACHES
The welfare reform law gives states a new opportunity to expand their substance abuse treatment for welfare recipients beyond the Substance Abuse and Mental Health block grant. States are using Temporary Assistance to Needy Families money to:

• Screen applicants.
• Put qualified substance abuse professionals in every welfare office.
• Integrate substance abuse education into job readiness programs.
• Teach welfare clients about addictions and how to recognize them.
• Teach welfare clients that acknowledging an addiction will not penalize them or their children.
• Provide screening services and treatment for welfare clients through mental health programs.
• Provide transportation and child care for those who need substance abuse treatment.
• Develop a plan to address the substance abuse needs of the entire welfare family through a comprehensive approach to treatment.
• Begin pilot programs that provide financial incentives to businesses that hire welfare recipients.

THE INNOVATORS
Oregon, Florida, North Carolina, Utah, New Jersey, Kansas, Maryland

THE COSTS
Forty percent of the states have allocated some TANF funds for substance abuse services. Oregon uses its federal TANF funds for nonmedical substance abuse services including the pay of alcohol and drug abuse professionals who screen applicants at every welfare office. For medical treatment, Oregon uses its state maintenance of effort funds. Oregon also uses TANF to fund Mt. Hood Community College’s comprehensive education program that all TANF clients are required to take even before they are screened for drugs or alcohol.

The Florida Legislature put $20 million of TANF money in FY 1998 into local substance abuse and mental health programs. North Carolina is spending $10.3 million on substance abuse services this year, including its Enhanced Employee Assistance Program that serves private businesses that hire welfare recipients.

THE OPINIONS
It is clearly urgent that we pay close attention to the substance abuse issue—so much depends on developing and implementing successful program models. I’m convinced that if we address this issue properly, we can substantially reduce many societal costs in human services and job productivity.—Senator Bill Martin, chair, North Carolina Appropriations Committee on Human Resources

In Florida, the Legislature got actively involved in deciding what needed to be done. Women with addiction problems were having trouble holding jobs, so we knew money had to go into programs that will help them. The experts don’t know what works, we need to evaluate this ourselves.—Representative Debby Sanderson, chair, Florida House Committee on Health and Human Services Appropriations

We need to reach these hard-to-serve welfare recipients, those struggling with substance abuse, domestic violence or other impediments to self-sufficiency. Our welfare caseloads are dropping, and those left on the rolls will be parents who need intensive services. It is critical, not only for their individual self-sufficiency, but also for their children.—Senator Martha Yeager Walker, chair, West Virginia Senate Health and Human Services Committee

Oregon’s substance abuse treatment program has evolved and expanded over time. What has made it successful is that it is fully integrated into the welfare-to-work program.—La Donna Pavetti, Mathmatica Policy Research

Rethinking the Role of Fathers

THE PROBLEM
Poor fathers have a difficult time keeping up with child support payments. These dads are often labeled deadbeats. But more than likely they are just dead broke and simply don’t have the money to stay current on their obligations. Often they have arrest records, have never finished high school and have a sporadic work history.

Nationally only 13 percent of welfare recipients receive any type of continuous child support. Some poor fathers avoid paying through the child support system because the money they pay is usually retained by the state. Instead they provide "underground support" by giving money, diapers or clothes directly to the mothers of their children. Then they face enormous arrearages that a minimum wage job cannot support.

Low income dads often were raised without fathers of their own and really don’t know what it means to be a parent. Because many of them were never married to their children’s mothers, they usually don’t have a formal visitation arrangement, and often the mother refuses to allow visits. Fathers usually do not know that their inability to pay child support is separate from their right to see their children.

NEW APPROACHES
States can extend services to poor dads using Temporary Assistance to Needy Families (TANF) or Maintenance of Effort (MOE) money by including noncustodial parents among those eligible for job training and support services. Some innovations include:

• Helping fathers find jobs.
• Giving fathers job training and education that enable them to get better jobs.
• Giving collected child support directly to families.
• Teaching dads about child development and the nurturing role that fathers can play in the lives of their children.
• Changing the message to focus on the emotional and financial contribution that dads can make.
• Helping fathers establish paternity and arrange reasonable child support payments.
• Combining welfare money with Welfare-to-Work and Workforce Investment dollars on services provided at the community level.

THE INNOVATORS
Arizona, California, Colorado, Illinois, Iowa, Maryland

THE COSTS
The Iowa legislature set aside $50,000 for the development of services for poor fathers. California redirected some welfare savings to seven counties to operate fatherhood programs with cost estimates ranging from around $900 per participant to $5,000 per participant. Each of the programs will serve 150 and 450 dads per year.

THE OPINIONS
These dads aren’t deadbeat dads, they are dead broke dads. If we help them get real jobs, they will pay child support and support their kids. All they need is a little help.—Dianna Durham McCloud, former child support enforcement administrator in Illinois

I know I don’t pay [through the government]—why should I? But I do do for him. You see, I want my boy to know that I paid for his shoes, his clothes, not the state.—Father, age 28, Los Angeles, California

Put It in a Different Pot

States can transfer up to 30 percent of their TANF funds to the Child Care and Development Block Grant, Social Services Block Grant and as a state match for the new Job Access and Reverse Commute Grant program within certain limits.

• States can transfer up to 30 percent of TANF directly into the Child Care and Development Block Grant.
• States can transfer up to a third of the 30 percent TANF funds to the Social Services Block Grant. Funds must be used only for services to children and families below 200 percent of poverty. For example, a state could transfer 10 percent of TANF to the Social Services Block Grant and transfer 20 percent into the Child Care Development Block Grant.
• Similarly, states can use TANF transfer funds (within the 30 percent limit) to fund transportation for current, former or at-risk welfare recipients under the Job Access and Reverse Commute program.

Programs and services funded by money transferred from TANF are not subject to federal restrictions such as time limits and work requirements and are not included in work participation rates. Currently, 16 states have transferred TANF money into the Child Care Development Block Grant, and 24 states have transferred money into the Social Services Block Grant.

States can choose to fund programs outside of TANF, strictly with state money. Expenditures for these programs can count as maintenance of effort , and they don’t require participants to be included in work participation rates or federal time limits. Fifteen states have invested state money in separate programs.

Expanding the Safety Net

No one is sure how families who have left welfare are supporting themselves. Some families have left for low-wage jobs, but others have been forced off the rolls because of time limits and sanctions. Few states have developed ways to identify and help families who may not be able to provide for their children.

NEW APPROACHES
To make sure that families do not sink deeper into poverty, states are using welfare money to connect families with services that can help them after they leave welfare. Some approaches include:

• Exit interviews before families leave welfare to tell them about community resources.
• Visits to a family’s home to see if they are facing hardships that call for intervention.
• Information about a family’s continued eligibility for Medicaid, food stamps and child care.
• Help in finding jobs.
• Vouchers for food and clothing.
• Money for rent and utilities.
• Financial management counseling.
• Counseling on what needs to be done for a family to regain eligibility for welfare.

THE INNOVATORS
Arkansas, Connecticut, Iowa, New York, Tennessee

THE COSTS
Connecticut appropriated $4.8 million in TANF funds to the WorkSteps/Safety Net Program to minimize harm that could come to children in families who lose cash benefits. Parents are helped in finding and keeping jobs. Costs per case vary from $1,550 to $1,900.

THE OPINIONS
If you have tough time limits, you have to provide a safety net for families who aren’t ready to leave welfare. Some families aren’t ready for work so you have to make sure that they and their kids have access to things like food and housing assistance, even if they can’t get welfare.—Representative Marie Kirkley-Bey, member, Joint Committee on Human Services, Connecticut

We are very pleased with our home visiting program. Recent changes will ensure that when state staff make a visit, the children are at home. That has been a major concern and this will make the program even more of a success.—Senator Elaine Szymoniak, ranking member, Human Resources Committee, Iowa

How Can You Use the Money?

States can use the Temporary Assistance for Needy Families (TANF) block grant and state maintenance of effort (MOE) money for a wide range of programs as long as the services and assistance address the four purposes of TANF:

• Provide assistance to needy families.
• End welfare dependence by promoting employment.
• Reduce out-of-wedlock pregnancies.
• Encourage two-parent families.

Funds must be spent on eligible families, but states define eligibility and can expand eligibility for particular services. States also can establish different eligibility standards for different services or programs.

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