The 'Impossible' Federal Standard States Can't Meet as They Work to Assist Low-Income Families

From its inception 26 years ago, the Temporary Assistance for Needy Families program has provided $16.5 billion annually through block grants to states with the ostensible goal of helping low-income parents become economically self-sufficient. 

Spawned by fears of welfare dependency, TANF was lauded in the years immediately after its passage for dramatically cutting the number of people who received cash assistance and for erasing the public perception that recipients were getting money for doing nothing. But important parts of implementation for the extremely flexible TANF grant have been flawed and very low-income recipients in the states have suffered as a result. With talk from both sides of the aisle about spending government dollars wisely, this is an unmistakable opportunity for improvement, advocates say.

A central problem focuses on the portion of TANF that provides cash aid to parents and a federal measurement standard that has dictated work requirements since the program’s inception. This work participation rate requires states to track and document the work or “work activities” of TANF cash recipients. It imposes sanctions on states for not meeting the standard and requires them to develop policies for sanctioning individuals who don’t cooperate.

Because the WPR is a process measure without a focus on results, it doesn’t provide information on whether the time spent has an impact on building economic self-sufficiency or increasing wages. By focusing just on work and using a single measure, rather than a basket of measures, it also underplays performance management attention to multiple other family, mental health or crisis-oriented supports offered through the TANF program. 

“This is the foundation of how both states and then how families who are on the program are held accountable,” says Matt Lyons, director of policy and research at the American Public Human Services Association, which recently published a report about TANF modernization. “The work participation rate bogs down customers and caseworkers in paperwork and processes that are disconnected from reality.”

When TANF was launched in 1996, the federal government required that all states ensure that 50% of single parents—and 90% of two-parent families—work or participate in work activities for 30 hours a week or 20 hours if children in the household were younger than 6 years old.

Political opinions differ on the merit of work requirements or whether they should be imposed, but the federal standard was regarded by many states as an unrealistic goal for extremely poor parents who experience multiple difficulties in their lives, including homelessness, domestic violence, drug addiction and mental health issues. “It’s an “impossible standard and states knew they couldn’t meet it,” says LaDonna Pavetti, vice president for Family Income Support Policy at the Center on Budget and Policy Priorities.

To meet the standard, some states took advantage of a part of TANF that allowed them to reduce the 50% requirement if they were able to cut their TANF caseload. In many cases, they took aggressive actions to create barriers to entry or to apply strict sanctions to families that they deemed uncooperative, with research from the CBPP demonstrating that sanctions have been applied to Black families more frequently than white ones. 

According to the center, 21 families received cash assistance from TANF in 2020 out of every 100 families in poverty. That’s down from 68 families out of 100 in 1996, when TANF was enacted. 

While the adjusted rate that individual states must meet has dropped dramatically over time for most states, the focus on charting work activities remains. 

“Even now, you would be hard pressed to find a state administrator who doesn't worry about meeting the work participation rate,” says Pavetti. “Trying to convince people that they don't have to pay attention to it is an uphill battle.”

The emphasis on tracking and documenting work activities “poisons the frontline relationship,” says Deborah Schlick, manager of the Strategic Projects Office in the Economic Assistance and Supports Division of the Minnesota Department of Human Services. The problem, she says, is that caseworkers or employment counselors are tasked with a “surveillance function.” 

This comment echoes what we’ve heard from other states, as well, and was a major conclusion of a June 2019 report by the National Skills Coalition, which cited the WPR’s “significant administrative burden” and the time it took away from creatively helping individuals and focusing on long-term employment results.  

Can This Situation Be Fixed? 

While there are defenders of the philosophy behind the WPR, there are not many who are happy with the way it operates and the idea of moving toward a more outcome-oriented performance-management approach has advocates on the left and right side of the political spectrum. 

“I am hopeful that there can be a compromise there,” says Angela Rachidi, senior fellow and Rowe Scholar in Poverty Studies at the American Enterprise Institute. She cites an outcome-oriented TANF bill that was passed by the U.S. House Ways and Means Committee in 2018, but never came to the floor for a vote. “I think there's general agreement that the work participation rate has kind of outlived its usefulness,” she says.

A number of states have demonstrated that reform is a possibility. Heather Hahn is an associate vice president at the Urban Institute and the author of a 2018 study that took a critical look at the WPR and explored seven states and one city that ventured beyond federal requirements to establish more useful performance management systems in a variety of different ways. The governments profiled were California, Colorado, Minnesota, New York City, Texas, Utah, Washington and Wisconsin.

Utah, for example, runs its TANF program through the Department of Workforce Services Job Centers. It continues to track the Work Participation Rate, but also uses information about TANF aid recipients who enter and retain employment after they leave the program to help understand what works and doesn’t. The state also contracts with the University of Utah’s Social Research Institute, which surveys TANF clients to learn more about their history of involvement, the challenges they face and the changes in the TANF population needs over time.

In Washington, TANF administrator Babs Roberts says the state has used results-oriented performance measures to gauge “the efficacy of the program areas that we fund with our dollars.”  For example, a program called Strategies for Success, which combined a number of financial literacy and job skills, has shown positive results. 

In contrast, an attempt to help TANF cash recipients get licensed to set up child care centers was given up as impractical. “That’s an example of something we don’t do anymore because we didn’t see the outcomes we were hoping for,” Roberts says.

These efforts paint a picture of a potential future that would rely on higher quality TANF data and data analysis, a better-understood TANF population and improved performance management policies. 

“I think there is a role for TANF to play in making families lives better. But the work participation rate is not it,” says Pavetti. “It gets in the way of states being creative and really helping families move to a better place than where they started. The work participation rate just doesn’t do that.”