Welfare Reform Issues Overview

Welfare Reform Issues Overview

Over the past decade, state and federal reforms transformed welfare programs Congress established the Temporary Assistance for Needy Families (TANF) block grant which gave states broad flexibility to run their cash assistance programs and to use federal funds to help low-income families, reduce out-of-wedlock pregnancies and support two-parent families. State legislatures used this flexibility to create work-focused programs-requiring parents receiving assistance to participate in work or training activities, providing supports such as child care and transportation so that they can work and enacted time limits on how long families could receive assistance. State legislatures also used these funds to create and expand a wide variety of programs to help low-income working families and children, such as early education and afterschool services, responsible fatherhood programs, teen pregnancy prevention and income supports and training to help working families stay in jobs and increase their earnings. NCSL provides information to state legislators and staff on key welfare topics such as state welfare policies, financing welfare, families leaving welfare, supporting low-income working families, marriage, fatherhood and family formation, and welfare reform reauthorization. The human services federal affairs staff represents state legislatures on federal welfare issues in Washington, D.C.

Congress is currently considering changes to the federal TANF program in discussions about reauthorization of the 1996 welfare reform law that created the TANF block grant. Welfare reform reauthorization is expected to take place in Congress in 2004. Key areas of debate include child care, work participation rates, education and training programs and marriage. This is a high priority issue for NCSL, which appointed an Executive Committee Task Force in 2001. NCSL is tracking the reauthorization process and analyzing federal laws to determine how any changes will impact states. NCSL is active in communicating with Congress and the Administration through correspondence and testimony. To follow the progress of welfare reform reauthorization, join the Human Services list serve.

State welfare policies vary greatly by state and were designed to help move parents off cash assistance and into the workforce. States have also created programs for the hard-to-serve, or those with barriers to employment-such as substance abuse, domestic violence, physical and mental disabilities, learning disabilities, lack of English proficiency and illiteracy. State policy choices also address the issues of time limits, sanctions, family caps, diversion and welfare caseloads.

Financing welfare consists of the federal TANF block grant and state maintenance of effort (MOE). The strong economy in the late 1990s and state reforms resulted in a sharp drop in welfare caseloads-this caused a shift in state welfare spending, from cash assistance payments to support services for low-income families. The decrease in caseloads resulted in most states having substantial money available for new initiatives serving low-income families. Most state states now have spent down these reserve funds and face tough fiscal choices about supporting the new programs because carry-over TANF funds ran out just as state budgets got tight.

Families leaving welfare are important indicators of the success of state welfare to work programs. NCSL has been tracking state studies of employment outcomes and family well-being for those who left welfare. Summaries of these studies and issue-based reports on the findings of these state reports are available on-line.

Supporting low-income working families has been an important goal to many state policymakers. This includes helping current and former welfare recipients keep their jobs, advance in the workforce, gain access to child care and transportation, build assets, further their education and pay for housing and utilities. Supports for low-income families, typically families with an income up to 200 percent of poverty, also includes government services such as food stamps, health care, housing and earned income tax credits.

Marriage, fatherhood and family formation have all been found to have a direct impact on child well-being. States are exploring programs that strengthen marriage, encourage responsible fatherhood and teach unmarried parents to co-parent. Federal officials have put a renewed emphasis on using TANF funds to support healthy marriage and many state policymakers have developed initiatives in response.

NCSL staff in D.C. and Denver can provide comprehensive, thorough, and timely information on critical welfare policy issues. We provide services to legislators and staff working to improve state policies affecting children and their families. The Denver-based welfare reform project staff focuses on state policy, tracking legislation and providing research and policy analysis, consultation, and technical assistance specifically geared to the legislative audience. Denver staff includes Jack Tweedie. Jack Tweedie can be reached at 303.364.7700 or cyf-info@ncsl.org.

NCSL staff in Washington, D.C. track and analyze federal legislation and policy and represent state legislatures on welfare reform issues before Congress and the Administration. In D.C., Sheri Steisel and Lee Posey can be reached at 202.624.5400 or fedhumserv-info@ncsl.org.

The welfare reform project and D.C. human services staff receive guidance and support from NCSL's Human Services and Welfare Standing Committee.