CHN: TANF Extended for 3 Months; Supplemental Grants Not Reinstated

H.R. 2943, the Short-Term TANF Extension Act passed the House on September 21, 2011.  Introduced by Rep. Geoff Davis (R – KY), Chair of the Human Resources Subcommittee of House Ways and Means, it extended funding for the Temporary Assistance for Needy Families block grant through December 31, 2011. Notably, the act did not reinstate the federal Supplemental Grants to the states.
These Supplemental Grants, providing additional TANF funds to poor states and those with high population growth, expired on July 1, 2011. Previously, the grants had been provided to 17 needy states every year since TANF’s inception in 1996. These 17 states are among the poorest in the nation, and have some of the worst child poverty and unemployment rates. The expiration of these Supplemental Grants means cutting funding to the affected states by about 10 percent, which is a truly significant loss for TANF.

TANF has been level-funded since the program began in 1996, with no adjustment for inflation or other factors. Today, state and federal funds are equal to only 72% of their original value in inflation-adjusted dollars, and cannot fund the same level of services that they did 15 years ago (see report from the Center on Budget and Policy Priorities).

Now that the recession has caused caseloads to rise in states that have not created massive barriers to enrollment, funds are not available to meet the current need. With the additional funding from the Supplemental Grants gone, many states have chosen to dramatically cut TANF assistance. In 2011, these cuts affected 70,000 low-income families, including 1.3 million children.

Many families living well below the poverty line have subsequently suffered cuts to cash assistance, child care and other work-related assistance usually provided through TANF. States implementing cash assistance cuts include California, Washington, South Carolina, Wisconsin, New Hampshire and the District of Columbia. States such as California and Arizona have shortened their time limits for receiving TANF benefits. And states have also cut support for low-income working families, as in Michigan, where the state Earned Income Tax Credit (partially funded by TANF) has been cut by two-thirds.

These cuts are ill-timed, as many of these states continue to suffer from high unemployment, low earnings, and poverty. The temporary extension of TANF also times its reauthorization to coincide with the actions of the Joint Select Committee on Deficit Reduction (the “Super Committee”). In the past, there has been little discussion of cutting the TANF block grant. However, based on comments during the September Ways and Means Committee TANF reauthorization hearing, support was expressed for restricting funding for other low-income programs by applying TANF-type work requirements.  Since these requirements in TANF often served more to deter eligibility than to provide opportunities for work, advocates are concerned about the impact these proposals might have on low-income families.

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Temporary Assistance for Needy Families