Welfare Caseload Watch

March 9, 2005

For most states, welfare caseloads have remained fairly stable, despite concerns over caseload increases during the recent economic downturn. National caseloads have leveled off even in the midst of relatively high unemployment rates. Some states have seen increases and others decreases, but overall, caseload numbers have not responded strongly to the weak economy. NCSL's Welfare Project is actively collecting welfare caseload information from state agencies to provide a national picture and analyze state trends.

Overall Caseload Trends
Current Trends
Separate State Programs
Separate State Program Caseload Trends
Tracking Recent Changes – Welfare Caseload Advisories
Welfare Caseload Changes by State--Based on Most Recent Month's Data
Caseload Trends Overtime
Caseload Changes Overtime (2000-2004)
Caseload Data Updates

Overall Caseload Trends

Overall, the national caseload has remained relatively stable during the past three years. The steep decline in caseloads that occurred as states reformed their welfare programs in the mid-1990s ended in mid-2001 as shown in Figure 1. States began seeing caseloads rise in August of 2001, and some states were seeing increases before then. Caseloads continued to increase during the latter months of 2001, only to go back down in the spring and summer of 2002 (most likely due to more seasonal employment opportunities during these months.) Caseloads increased slightly in the fall of 2002 and again decreased beginning in early 2003. Since March 2003, national caseloads have remained stable and even declined slightly.

Figure 1. National Welfare Caseloads -- March 1994 to September 2004

Source: U.S. Department of Health and Human Services-The Administration for Children and Families and National Conference of State Legislatures, 2005.

Two characteristics of the data should be noted. First, states' caseload reporting cycles differ, so the most recent month for states will be from September 2004 through January 2005, depending on the state. Second, many states maintain data differently than what is ultimately reported by the federal Administration for Children and Families (ACF). Many states have separate state-funded cash assistance programs for two-parent families, families headed by legal immigrants, and other populations. NCSL gathers data on both the federal-funded and state-funded cash assistance caseloads, therefore, the numbers for many states cannot be compared directly with those issued by ACF.

Current Trends

National caseloads have remained relatively stable over the past few years. Caseloads declined through August 2002 when caseloads increased slightly. The increases continued through the last quarter of 2002. Beginning in 2003, the national caseload appears to have leveled off continuing through 2004.
Despite the economic downturn, there does not appear to be a national link between unemployment and welfare caseloads. NCSL examined state caseload and unemployment trends and although one would expect caseloads to increase as unemployment increases, no such link has been found consistently across the states. More research is needed on the variables impacting caseloads nationally. Not all who are unemployed are eligible for public assistance. Some states changed their eligibility levels or created separate programs for families, which impacted caseloads.
Caseloads have declined in 29 states and increased in 22 of the states during the past year. Most of these changes have been modest. Caseloads in 21 states and the District of Columbia increased during the past 12 months. Pennsylvania and Illinois caseloads increased by more than 10 percent in the past year. Five other states saw increases over five percent. At the same time, caseloads dropped in 29 states and in 13 states by 10 percent or more.
Ten states are at their lowest caseload level since the beginning of the TANF program and many others remain close to their lowest levels. Louisiana, Minnesota and North Carolina reached their lowest levels in December 2004. Arkansas, Connecticut, Hawaii, Kentucky, Rhode Island, Texas and Vermont reached their lowest levels in January of this year. Ten other states are within five percent of their lowest point.
Welfare caseloads remain significantly below their 1994 highs, even in states with substantial increases. Nationally, cash assistance caseloads are still down more than half from their levels in March 1994—this date is important because state TANF block grants are based on 1994 spending levels. Thirty-three states have less than half the number of families on their caseload that they had in 1994. Even states that have recently experienced sharp caseload increases still have significantly smaller caseloads then they had in March 1994.
Twelve states have experienced a caseload increase of at least 20 percent since their lowest levels. Increases go up as high as 47 percent in both Arizona and Idaho. Despite this increase, these states currently have a caseload that is below where the caseload was at its national high in March 1994. For example, Arizona’s current caseload is 32 percent below and Idaho is 79 percent below where it was in March 1994. See Table 1.

Table 1. Caseloads Remain Down Even in States with Recent Increases

States with increases over 20% from lowest month

Caseload Increase Since Lowest Month

Caseload Decrease since March 1994

Arizona

47.4%

-32.3%

Idaho

47.3%

-78.9%

Kansas

45.6%

-43.7%

Utah

39.3%

-45.9%

Nevada

36.6%

-36.3%

Colorado

33.1%

-65.0%

Tennessee

31.6%

-34.6%

Oregon

30.1%

-54.5%

Indiana

26.3%

-38.5%

Virginia

23.9%

-52.6%

Wisconsin

21.7%

-72.4%

Source: National Conference of State Legislatures, 2005.

Separate State Programs:

One important trend is the increased utilization of Separate State Programs (SSP) to fund assistance for families. The flexibility granted under welfare reform, the Personal Responsibility and Work Opportunity Reconciliation Act (PRWORA) of 1996, allowed states to creatively address the needs in their states. Some states, at least 28, have chosen to use this flexibility to create state-funded programs for certain populations. The most common population served through SSPs is two-parent families. The federal work participation rate is much higher for these families (90%). By using state funds, the families do not come under the federal rates and states have the flexibility to provide needed services to the families to help them achieve self-sufficiency. Spending on separate programs can be counted towards the state’s maintenance of effort.

Other populations commonly served in state-funded programs include:

Qualified non-citizens (including refugees)
Those participating in postsecondary education – including Maine’s Parents as Scholars program and the New Mexico Education Works program
Disabled clients
Domestic violence victims

These programs are funded solely with state dollars. States can establish their own eligibility criteria and program guidelines. Time spent in state-funded programs does not count against federal time limits. This gives the state flexibility to serve populations that may have difficulty meeting federal requirements. States can focus on providing effective services to help families achieve self-sufficiency.

The majority of state-funded programs are small relative to the overall cash assistance caseload. In 15 states, the SSP caseload is less than five percent of the total cash assistance caseload. Only three states have an SSP that comprises more than 20 percent of the total caseload. See Table 2.

Table 2: SSP Caseload as a Percentage of Total Cash Assistance Cases

Most Recent Month of Data

Caseload - Most Recent Month

SSP as % of Total Caseload

Alabama

December

280

1.32%

California

October

39,266

8.00%

Connecticut

January

3,670

16.56%

Delaware

November

331

5.33%

Dist. of Col.

December

403

2.27%

Florida

January

2,480

3.81%

Georgia

December

271

0.58%

Hawaii

January

3,202

27.38%

Illinois

January

861

2.03%

Indiana

January

2,123

4.62%

Maine

September

1,468

13.28%

Minnesota

December

3,088

9.46%

Missouri

January

6,718

14.19%

Nebraska

January

2,014

16.91%

Nevada

December

413

4.63%

New Jersey

October

2,018

4.36%

New Mexico

October

479

2.61%

New York

December

49,633

26.40%

Oklahoma

January

96

0.71%

Rhode Island

January

2,501

18.62%

Tennessee

January

1,427

1.95%

Texas

January

3,475

3.60%

Utah

January

63

0.65%

Vermont

January

416

8.30%

Virginia

October

21,050

58.52%

Wisconsin

December

627

2.88%

Wyoming

January

5

1.48%

Note: Maryland has a state program but is not included in the analysis due to missing data.

Virginia has the largest separate state program, accounting for over 58 percent of the cash assistance caseload in October 2004. Two-parent families are funded solely through state dollars. As of July 1, 2003, those not mandated to work also are included in the separate state program. In June 2003, Virginia had 30,883 federal TANF cases, but in July 2003 it reported 7,998 cases because over 23,000 had been moved into the separate state program.

Over 27 percent of Hawaii’s caseload is comprised of individuals and families receiving assistance funded with state dollars. The program is called Temporary Assistance to Other Needy Families (TAONF) and includes two-parent families and non-citizens. The TAONF program was included in the original state TANF plan.

New York’s separate state program, Safety Net Assistance, accounts for 26 percent of the total cash assistance caseload. On average, 50,000 cases are funded solely through state dollars. The Safety Net Assistance program is designed for those populations who are not eligible for other programs, to include childless adults, certain non-citizens, families of persons with substance abuse problems, and recipients who have reached their 60-month limit on assistance. Benefits are provided for a maximum of two years in a lifetime.

Separate State Program Caseload Trends

Fourteen states have experienced caseload increases within their separate state program in the last year. Five states have seen an average increase over one percent per month in the last 12 months. Nebraska, Illinois and Wisconsin have seen increases over 50 percent in the last 12 months.
Eleven states have experienced SSP caseload decreases compared to the same period in 2003. In eight states, the decrease has been 10 percent or more in the last 12 months. Georgia’s SSP caseload declined more than 50 percent.
In seven states the SSP caseload does not follow the same pattern as the total welfare caseload. In five states, the SSP caseload increased while the total caseload decreased. Florida and California, however, experienced decreases in SSP caseload while their total caseload increased over the last twelve months.

Table 3: Separate State Program Caseload Changes

Most Recent Month of Data

Caseload - Most Recent Month

Percent Change –

3 Months

Percent Change –

6 months

Percent Change –

12 Months

Alabama

December

280

30.23%

40.70%

27.27%

California

October

39,266

-2.16%

-0.91%

-0.25%

Connecticut

January

3,670

0.58%

1.44%

3.38%

Delaware

November

331

17.79%

18.64%

7.12%

Dist. of Col.

December

403

27.13%

54.41%

12.26%

Florida

January

2,480

-10.40%

0.85%

-13.77%

Georgia

December

271

-16.10%

-40.44%

-57.98%

Hawaii

January

3,202

-1.05%

-5.52%

-12.03%

Illinois

January

861

1.77%

10.38%

58.27%

Indiana

January

2,123

-3.63%

-12.85%

-23.91%

Maine

September

1,468

7.00%

5.76%

15.77%

Minnesota

December

3,088

-13.89%

-34.99%

-33.48%

Missouri

January

6,718

1.60%

2.05%

-3.05%

Nebraska

January

2,014

2.13%

-2.19%

71.84%

Nevada

December

413

-15.20%

-13.05%

-20.58%

New Jersey

October

2,018

2.54%

1.56%

13.31%

New Mexico

October

479

29.81%

-2.84%

3.46%

New York

December

49,633

-0.38%

-1.38%

0.79%

Oklahoma

January

96

6.67%

43.28%

-11.93%

Rhode Island

January

2,501

4.95%

3.91%

Tennessee

January

1,427

0.99%

2.07%

Texas

January

3,475

-4.24%

-5.34%

-24.19%

Utah

January

63

75.00%

70.27%

16.67%

Vermont

January

416

-1.65%

10.05%

-9.96%

Virginia

October

21,050

0.57%

-0.85%

2.46%

Wisconsin

December

627

26.67%

83.33%

75.63%

Wyoming

January

5

150.00%

150.00%

25.00%

Tracking Recent Changes – Welfare Caseload Advisories

Caseload pressures have eased in most states. Only seven states are in a caseload advisory as of fall 2004 compared to 10 in the previous winter. No states are in a caseload warning, the highest level of advisory, compared to five a year ago.

Unfortunately, it is difficult to forecast welfare caseloads, particularly with ongoing uncertainty over welfare reauthorization, tight state budgets and the economy. Because of the difficulty forecasting welfare caseloads, officials will want to pay careful attention to trends in their states and to key economic and fiscal indicators that can affect caseloads and the state's ability to respond to those trends.

NCSL's welfare project is analyzing the states' welfare data to identify state-specific trends that can alert policymakers about when they may need to be concerned about their caseloads. The best available basis for examining caseload trends comes from recent changes in the states' welfare numbers, particularly where there is sustained movement, and changes over time.

Recent caseload changes (during the past three, six and 12 months) help identify the states where caseload growth may be of immediate concern for policymakers and where it might become an issue. Borrowing the language of National Weather Service advisories, Figure 2 classifies states into four categories, based on recent caseload changes:

Caseload Warning - Sustained increase where caseload has risen by more than 1 percent per month during the past 12 months. Caseload changes of this magnitude should be taken into account in current program planning and budgeting.
Caseload Watch - Recent increase where caseload has risen by more than 1 percent per month for both the past three and six-month periods. Caseload changes of this magnitude, if they continue, are likely to affect program planning and budgeting.
Caseload Advisory - Recent increase where caseload has risen by more than 1 percent per month for either most recent three or six-month period. Caseload changes of this magnitude, if they continue, may affect program planning and budgeting.
No Current Caseload Advisory - No recent increase in caseload of more than 1 percent a month for any of the past three, six or 12 months. Even in these states, we recommend that policymakers continue to monitor caseloads because so little is known about how they will change with the economy and other factors in the new welfare system.

States with a caseload warning or watch may need to take an increasing caseload into account when creating human services programs and budgets. This is especially important to policymakers facing tight state budgets or program cuts.

Figure 2. Welfare Caseload Advisories for States

Welfare Caseload Advisories for States

Caseload watch (1) Legend 2 AL

Caseload advisory (7) Legend 3 AK, FL, ID, IL, NH, OR, WA

No current caseload advisory (43) Legend 4 AZ, AR, CA, CO, CT, DE, GA, HI, IN, IA, KS, KY, LA, ME, MD, MA, MI, MN, MS, MO, MT, NE, NV, NJ, NM, NY, NC, ND, OH, OK, PA, RI, SC, SD, TN, TX, UT, VT, VA, WV, WI, WY, DC

Table 4 identifies the most recent month of welfare caseload data available for each state, the number of families that received cash payments in that month, and the changes in the number of families that received cash assistance in the past three, six and 12 months.

Table 4. Welfare Caseload Changes by State--Based on Most Recent Month's Data

Most Recent Month of Data

Caseload –

Most Recent Month

Percent Change –

3 Months

Percent Change –

6 months

Percent Change –

12 Months

Alabama

December

21,160

6.01%

12.89%

7.54%

Alaska

January

5,768

4.82%

0.72%

-6.29%

Arizona

December

48,520

-2.48%

-5.34%

-12.02%

Arkansas

January

9,009

-4.28%

-5.23%

-13.66%

California

October

490,746

0.47%

0.77%

3.03%

Colorado

July

14,875

-0.54%

1.36%

4.67%

Connecticut

January

22,156

-0.78%

-1.58%

-2.57%

Delaware

November

6,213

1.89%

3.12%

2.10%

Dist. of Col.

December

17,727

0.76%

1.95%

0.84%

Florida

January

65,111

1.84%

13.73%

7.21%

Georgia

December

46,336

-4.38%

-8.97%

-20.12%

Hawaii

January

11,693

-3.13%

-4.67%

-10.10%

Idaho

January

1,906

5.48%

2.97%

1.33%

Illinois

January

42,429

2.72%

6.84%

10.78%

Indiana

January

45,997

-1.99%

-2.12%

-3.18%

Iowa

December

19,673

-2.31%

-1.42%

-1.28%

Kansas

January

17,227

0.18%

2.44%

9.18%

Kentucky

January

31,469

-1.89%

-1.52%

-2.80%

Louisiana

December

12,935

-1.11%

-1.60%

-26.17%

Maine

September

11,052

0.50%

2.84%

5.24%

Maryland

December

27,864

-0.15%

-0.81%

-6.42%

Massachusetts

December

48,516

-0.78%

1.70%

-1.54%

Michigan

December

78,627

1.17%

0.77%

0.00%

Minnesota

December

32,657

-7.10%

-16.87%

-16.72%

Mississippi

October

17,547

-3.03%

-4.86%

-11.45%

Missouri

January

47,346

-0.09%

0.72%

-1.97%

Montana

December

4,730

-6.56%

-7.74%

-11.59%

Nebraska

January

11,909

-1.97%

-3.84%

-3.17%

Nevada

December

8,928

-1.87%

-2.31%

-11.42%

New Hampshire

January

6,046

3.35%

3.07%

0.43%

New Jersey

October

46,251

2.16%

3.60%

4.51%

New Mexico

October

18,377

2.98%

3.09%

2.36%

New York

December

187,972

-0.93%

-1.87%

-1.07%

North Carolina

December

40,694

-2.93%

-2.62%

-6.81%

North Dakota

December

2,799

-0.89%

-3.78%

-10.46%

Ohio

December

84,937

0.19%

0.88%

0.18%

Oklahoma

January

13,486

-1.72%

-0.49%

-6.64%

Oregon

January

19,850

3.44%

5.15%

7.09%

Pennsylvania

January

100,844

2.21%

5.95%

11.81%

Rhode Island

January

13,433

-2.03%

-6.01%

-4.23%

South Carolina

January

17,391

0.44%

3.00%

-5.19%

South Dakota

January

2,810

1.70%

3.16%

0.57%

Tennessee

January

73,032

-1.05%

-0.46%

0.02%

Texas

January

96,625

-5.81%

-4.73%

-16.46%

Utah

January

9,680

1.70%

2.06%

1.31%

Vermont

January

5,011

-2.64%

-4.19%

-6.58%

Virginia

October

35,971

2.97%

1.16%

6.61%

Washington

January

58,070

5.09%

5.25%

3.87%

West Virginia

November

11,778

-5.21%

-14.23%

-16.62%

Wisconsin

December

21,748

-5.80%

-4.72%

-2.91%

Wyoming

January

337

0.90%

4.66%

-10.37%

Source: National Conference of State Legislatures, 2005.

Note: Colorado’s most recent data is from July due to computer system problems.

Caseload Trends Over Time

The sharp drop in caseloads since 1994 occurred in a historically strong economy, and caseloads in most states increased as the national economy went into recession. Experts disagree about how strongly caseload trends are tied to the economy. NCSL's own assessment of the effects of rising unemployment on welfare caseloads has not shown a strong link in most states. As explained earlier, other variables impact caseload figures.

We compared states' most recent caseload data to their lowest month and found that while 21 states have seen an increase in their caseload, some states are currently hitting their all-time caseload low. Ten states are currently experiencing their lowest caseload since 2000. However, Arizona and Idaho caseloads are 47 percent higher than their lowest point.

Figure 3 presents the percent increase in each state’s caseload since the month when their caseload was a historic low.

Figure 3. Caseload Increase Since Lowest Month

> 40.1% increase (3)		AZ, ID, KS
20.1% - 40.0% increase (9)		AL, CO, IN, NV, OR, TN, UT, VA, WI
5.1% - 20.0% increase (19)		AK, DE, FL, IL, ME, MA, MI, MS, MT, NE, NH, NJ, NM, NY, PA, SC, SD, WA, DC
0.1% - 5.0% increase (10)		CA, GA, IA, MD, MO, ND, OH, OK, WV, WY
Currently at lowest level since 2000 (10)		AR, CT, HI, KY, LA, MN, NC, RI, TX, VT

Caseload Changes Over Time

Tracking states' cash assistance caseloads requires an examination of both long-term and short-term changes. Short-term variations are more likely to reflect seasonal factors or recent economic trends. Since 2000, caseloads have dropped in both June and July and increased in August of every year. This can likely be attributed to seasonal employment during the summer months. However, given the frequent time lag between increases in unemployment and the amount of time it would take for a family to return to welfare, it also is important to assess trends over a longer period of time. The tables below include caseload data by month for each state in recent years.

Table 5. Welfare Caseload, 2000

Table 6. Welfare Caseload, 2001

Table 7. Welfare Caseload, 2002

Note: Maine’s caseload data prior to October 2002 does not include SSP cases.

Table 8. Welfare Caseload, 2003

Table 9. Welfare Caseload, 2004

Caseload Data Updates

It is difficult to obtain current national information on welfare caseloads. The most recent national numbers available from the U.S. Department of Health and Human Services (HHS) date to June 2004. NCSL's welfare project is actively tracking state caseloads by using state agency web sites and contacting agency officials to obtain the most recent caseload data from all 50 states and the District of Columbia. The most recent data will be posted on our website and updated as we get new information. Our caseload watch contains the most recent month for which data is available along with the number of families receiving welfare in that and all previous months back to January 2000.

Technical note: The caseload data reported here come directly from the states and, in most cases, are calculated on a basis different from the data reported by HHS. Our caseload numbers and the analyses of changes over time are based consistently on the data reported to us by the states, so any changes we describe do not reflect different methods of counting caseloads. However, because of our use of state data, the caseload numbers cannot be directly compared to the ones reported by HHS. In addition, because of the different methods states use to count caseloads and because we are reporting the most recent month available so that it differs by state, it is not possible to calculate a meaningful national caseload figure at a specific point in time.

For more information, contact Jack Tweedie at 303.364.7700.