Partners (Summer 1997)

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Mother A New Era
by Keenan S. Conigland

Six decades of "welfare as we know it" ended when the Personal Responsibility and Work Opportunity Reconciliation Act of 1996 was signed into law. Effective July 1, this ground breaking event replaced Aid to Families With Dependent Children (AFDC) with Temporary Assistance to Needy Families (TANF). As a result of this fundamental policy shift, approximately one million families throughout the Sixth District (Alabama, Florida, Georgia, Louisiana, Mississippi, and Tennessee) must transition from public assistance to the workplace—rather quickly.

According to the American Public Welfare Association (APWA), a Washington based public policy organization, the new federal law provides a total of $16.38 billion in the form of block grants for states in fiscal years 1997 to 2002. Cumulatively, federal expenditures for TANF block grants are projected to shrink by $55 billion over the same time period—a decline approaching 50 percent. Funding from Washington will be provided on "the basis of previous federal expenditures for AFDC benefits and administration, Emergency Assistance and the Jobs Opportunities and Basic Skills Training Program," notes APWA.

The chart below highlights some of the differences between the previous and newly established public assistance programs.

AFDC/TANF STATISTICS
  Alabama Florida Georgia Louisiana Mississippi Tennessee
Average AFDC Monthly Payment (U.S. Average: $376.47) $152.20 $271.91 $252.11 $161.42 $119.97 $161.80
Average Number of years on AFDC (U.S. Average: 3) 2.7 2.1 2.7> 3.5 4.2 2.4
TANF Grant Size (97) $93,215,207 $562,340,120 $330,741,739 $163,971,985 $86,767,578 $191,523,797
Lifetime Limit under TANF 60 months/ 24 consecutive month limit 48 months/ 24 consecutive month limit 48 months/ 24 consecutive month limit 60 months 60 months/ 24 consecutive month limit/td> 60 months/ 18 consecutive month limit
State Contact Joel Sanders
Department of Human Resources
(334) 242-1773
Curtis Austin
Senate Committee on Commerce and Economic Opportunities
(850) 487-5815
Peter Lee
Department of Human Resources
(404) 656-4937
Judy Wright
Department of Social Services
(504) 342-6729
Larry Temple
Department of Human Services
(601) 359-4500
Glenda Shearon
Cash Assistance and Food Stamps Policy
(615) 313-5652
Sixth District states, due to the lower cost of living in the southeast, have consistently provided substantially lower monthly payments per case than the U.S. average according to figures released by the Administration for Children and Families under the U.S. Department of Health and Human Services.

Further, with the exceptions of Louisiana and Mississippi, public assistance recipients residing in the Sixth District tend to remain on AFDC for shorter time periods than the national average due to the large number of jobs generated by the southeastern economy which has lead the nation in economic growth for most of the 1990s.

Nationwide, AFDC/TANF family caseloads have decreased from 4,963,000 families in January 1993 to 4,628,000 in January 1997, a decline of 335,000 families. The forces behind the dramatic decline can be linked to the longest economic expansion in postwar history and the urgency with which the states, since the early 1990s, have fashioned welfare into a transition-to-work initiative. While the percentage of the U.S. population on public assistance in 1960 stood at 1.8 percent and grew to as much as 5.5 percent in 1993, the percentage is now down to 4.1 percent and is expected to decline further.

"It's simple: more jobs mean more people have more chances to work," offers Tom Cunningham, regional research officer, Federal Reserve Bank of Atlanta.

In an effort to decrease this percentage even more, U.S. businesses are being challenged to broaden the American mainstream by hiring welfare recipients. In response, a consortium of companies, led by United Airlines CEO, Gerald Greenwald, joined together to form the Welfare to Work Partnership. In addition to the private sector, the federal government has pledged to hire 10,000 welfare recipients by 2002.

Decline in Welfare Cases

Many Local Issues Remain

Collectively and individually, state TANF programs are "works in progress," patch quilts utilizing various approaches to realize the common objective of transitioning recipients to work as quickly as possible. Adults residing with families receiving benefits in the Sixth District must meet minimum work participation guidelines following two years of assistance. Families with able-bodied adults not meeting stated requirements must be engaged in an approved activity such as vocational training, community service, or secondary school attendance.

States throughout the District are pouring more money into child care, transportation, job training and recruitment. While this strategy is widely applauded, it has some shortcomings. "We're definitely headed in the right direction but there are going to be problems. Transportation networks don't really reach into the rural areas. This is a problem for rural residents because most of the new jobs are springing up in metropolitan areas," explains Larry Temple of the Mississippi Department of Human Resources.

Public assistance is not going away. Federal law allows states to exempt up to 20 percent of their caseloads from the five year limit. "It is quite possible that there are certain segments of the population that states will have to carry such as the {severely} mentally ill and female heads of households, some of whom often have difficulty securing employment," discloses John Sciamanna, APWA senior policy associate.

Single mothers and children are heavily represented on public assistance rolls because they are less likely to secure long-term employment; in most instances, children are too young to work; and women, even if employed at the minimum wage, often have difficulty earning enough money to support their families in the face of rising childcare and transportation costs.

The national and local implications of welfare reform have yet to be fully determined as the socioeconomic overhaul is still at an early stage. What is certain, however, is that history will inevitably scrutinize the merits of welfare reform based on whether it actually lifts millions of Americans into the economic mainstream—thus benefitting the entire nation.

OLD WELFARE SYSTEM
AFDC
The program entitled all needy families/individuals to federal and state assistance. In some cases, there were work requirements; however, there were no time limits on benefits. The program expense was a shared burden assumed by states and the federal governments. Federal regulations governed the fundamental tenets of the program.
NEW WELFARE SYSTEM
TANF
The program has a lifetime eligibility limit of five years. Assistance cannot be provided to families where an adult has received a total of 60 consecutive or non-consecutive months of TANF benefits.

States are allowed to exempt up to 20% of their TANF caseload from the lifetime limits for hardship reasons.

Funded through block grants to the states. Block grants total $16.4 billion annually for the country, with no funding for job training and job placement efforts.

Food Stamps

Entitlement for eligible persons with no time limit on benefits. No work requirements imposed for recipients. Legal immigrants meeting all other eligibility requirements may receive benefits. No age-based requirements specifically imposed for eligible adults. Military personnel distinctions not applicable under the former food stamp program.

Food Stamps

Entitlement for eligible persons. Total benefits are reduced by 3% for all recipients. Work requirements are imposed for childless adults. TANF families will remain eligible for Food Stamps even when their TANF benefits end.

Most legal immigrants, and those who arrived in the U.S. after 8-22-96, are not eligible for Food Stamps until they become citizens. Persons 18-50 years old without children at home who are able to work are entitled to food stamps for only 3 months during every 36-month period. The 3-month timetable starts the day official notice is received from the local or state department of social services. Military personnel or veterans who are honorably discharged (and their spouses or unmarried dependent children) are permanently exempt from the 3 month limitation.

Medicaid

Families who were eligible for AFDC were automatically eligible for SSI and state-administered medical programs.

Medicaid

States can opt to terminate benefits for adult TANF recipients who fail to meet their TANF work requirements. Children are excluded.

Supplemental Security Income (SSI)

Children living in families eligible for AFDC were automatically qualified for Medicaid or state-administered medical programs.

Immigrants otherwise eligible for SSI were ineligible based on immigrant status.

Supplemental Security Income (SSI)

The children's SSI program will be cut by $8.2 billion. A narrowed definition of disabled for SSI eligibility will end eligibility or deny eligibility to 315,000 low-income children with disabilities. The Congressional Budget Office estimates that 15% of these children will also lose eligibility for Medicaid. Immigrants are ineligible until citizenship. States must terminate SSI and Food Stamps at first scheduled recertification dates, which are staggered over the next year.


Reprinted with permission from the Federal Reserve Bank of San Francisco, Community Affairs Department.

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S t a t e     I n n o v a t i o n s
Alabama

Recognizing that training represents a huge portion of the welfare reform equation, Alabama state officials unveiled their Industrial Partnership Program, a statewide initiative that provides job training services at the employment site. "What we offer are classroom services germane to the job," asserts Joel Sanders, Director, Welfare Reform Division, Alabama Department of Human Resources. Not only does this program work towards proficiency in various employee functions, it also offers time management and basic education courses, the objective of which is to build confidence and self-esteem. This approach has generated favorable results in other areas as well, namely job retention. "While we have experienced some turnover, some employers credit this program for employee retention rates equal to the traditional workforce," submits Sanders.

  • Teen parents must remain in school and live with a parent
  • Recipients can keep the first three months of work salary if reported in a timely and accurate manner
  • Medicaid benefits are available for 12 months after benefits terminate as a result of employment
Louisiana

In Louisiana, the Family Independence Temporary Assistance Program (FITAP) has the overall goal of decreasing long-term dependency on public assistance by promoting job preparation, employment, and the family structure.

When prospective recipients apply for public assistance, case workers assess their education and skills level and match them with potential employment opportunities. "Our caseworkers throughout Louisiana's nine regions maintain contact with the local community and, therefore, have a pretty good feel for employment opportunities," offers Sam Guillory, Assistant Director, Louisiana Family Independent Work Program. Once an individual becomes employed, he or she is no longer eligible to receive state supported day-care and transportation.

  • Earnings of students ages 17 and under are excluded from consideration
  • Voluntary resignation results in 1 to 2 month suspensions
  • Homeless individuals no longer receive services automatically
Florida
Florida's program, introduced under the state's Work and Gain Economic Self-Sufficiency Act (WAGES) relies heavily on local industry to implement reform. "We feel that the direct, up-front participation of the corporate sector is vital to reform here in Florida," says Curtis Austin, Staff Director, Florida Commerce and Economic Opportunities Committee.

Under WAGES, Florida has established a series of one-stop employment and career centers as the primary entry points for public assistance recipients. "I'd have to say Florida is really ahead of the curve with their mixed services and employment approach," offers Sciamanna of APWA. WAGES also features a number of incentives for those successfully engaged in the program, including vocational and on-the-job training, subsidized child care, transportation allowances and more.

  • Children of noncompliant parents may receive benefits through a third party payee
  • Vocational training is provided through Enterprise Florida, Inc.
  • Operates a new automated fraud detection and prevention program
Mississippi
=Mississippi was the first state in the nation to fully implement its TANF program, which offers recipients one of the most attractive incentives of its kind. "Any client getting a job within the first 30 days of enrollment gets to keep both their welfare and payroll checks for six months," says Larry Temple of the Mississippi Department of Human Services.

In an effort to address responsible behavior, the Governor recently endorsed a challenge to churches and synagogues to serve as social workers for the state's public assistance recipients. Dubbed the "Faith and Families Project," it strives to inspire permanent behavioral change by matching families (typically headed by a single female) with religious institutions. In this capacity, the religious community hopes to help able-bodied adults secure employment, learn budgeting, and obtain day-care assistance.

  • Requires noncustodial parents to participate in JOBS to meet child support obligations
  • Broadens eligibility for transitional child care and transitional medical assistance
Georgia
Under Georgia's subsidized employee program, participating companies pay employee trainees (former public assistance recipients) a salary and receive the employee's TANF check from the state for nine months to offset training and other costs associated with preparing the trainee to become a productive employee.

Another subsidized incentive offered by the state is the Work Opportunity Tax Credit Program. "This incentive allows employers to earn tax credits up to $2,100 for each worker hired within one of several targeted groups, such as food stamp recipients, felons, youths and veterans," says Peter Lee of the Georgia Department of Human Resources.

  • Imposes a family cap and pregnant teen residency requirements
  • Provides childcare assistance for participants in employment training, job search, and for the working poor.
Tennessee
Tennessee is one of several states that actively promotes "peer group" microlending in association with TANF, making funds available to "teams" of entrepreneurs, who in turn, make loans to group members. These loans generally range from $500 to $5,000. The state has also designed day care and transportation systems to facilitate the welfare-to-work process, according to Glenda Shearon, Director of Cash Activities and Food Stamps for Tennessee. Like others, Tennessee emphasizes work activity up-front and hopes that its Personal Development Responsibility Plan will go a long way towards realizing that goal. "Tennessee is using adult basic education and making sure we provide opportunities for good work activities. This is essential to the plan's success," said Ms. Shearon.
  • Recipients must sign a plan which lays out employment goals
  • No additional benefits for new children while on the program
  • Enforced child support

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