National Association of State Liaisons for Workforce Development Winter Meeting Setting a New Course for State Welfare Programs January 22, 2007

New TANF Provisions and Implications TANF provisions in the DRA impose new rigor around work requirements State flexibility further limited by the interim rules Opportunity and challenges -- What’s the connection to the workforce system?

DRA: Major Funding Issues Fixed funding $16.57 billion through 2010 Supplemental grants extended through 2008 $200 million additional child care $ Eliminates bonuses; new marriage $ Changes in child support & child welfare that decrease federal reimbursement

DRA: Major Work Issues Retains work participation rates of 50% for all families and 90% for two-parent families Changes base year for calculating caseload reduction credit to 2005 Includes those in separate state programs in calculation of work participation rates

Implications Value of caseload credit greatly diminished – work rate is very real challenge. FY 2004 only nine states met 50%, 18 states were below 25%. 29 states had separate state programs for two-parents and families with significant barriers, representing 12% of the caseload.

Implications, cont’d New provisions effective October 1, 2006, states had little time to make strategic choices. Penalties and higher maintenance-of-effort requirement if fail to meet work rate. Up to 5% of TANF grant and 80% MOE Uncertainty about penalty “disposition”

Regulations on work definitions Narrows work experience and community service –excludes “barrier removal” activities. Job search and job readiness become “catchall” but are time limited. Baccalaureate education doesn’t count. ABE and ESL only when part of employment or vocational educational training. Verification & reporting requirements.

Challenge for States Meeting the work rate and: Supporting working families, including advancement and retention and child care Assisting persons with multiple barriers Allowing activities that might not count toward work participation rate Using TANF $ flexibly and for broader purposes

Strategies for Meeting Work Rate Engage people sooner Engage more people Engage individuals for more hours Keep working families attached longer Reduce denominator – soley state-funded Count better

Opportunities Clarify desired goals and purposes of state welfare programs. Re-energize program. Redirect spending back to welfare-to-work efforts Revitalize partnerships with workforce system and others Increase short-term training opportunities

Elements of Success? Leadership that focuses on broader goals Strategic partnerships Using knowledge gained and research conducted over past 10 years Culture change and messaging Enhancing front-line capacity Measuring performance Blending short-term responses with longer-term strategies

Immediate Strategies to Meet TANF Requirements Earnings Supplements Solely State-Funded Programs Sanction Policies Definitions of Work-Related Activities Up-Front Diversions

Earnings Supplements Small cash payments for employment-related expenses or bonuses for remaining employed Helps states by retaining employed TANF clients in work participation rate Example: Arkansas Work Pays

Solely State-Funded Programs State funds used to support TANF families that do not count towards MOE – “outside of TANF/MOE structure” Clients can enroll in activities most suited to their needs, not necessarily those that count towards the work participation rate States can serve clients with more substantial barriers to employment without a reduction in work participation rate

Sanction Policies States moving from partial to full-family sanctions States implementing sanction policies within a shorter time period Clients need to fully understand policies Families often need assistance after being sanctioned

Definitions of Work-Related Activities States are redefining work-related activities to match federal definitions Focus on engaging more clients, increasing number of clients in countable activities, increasing number of hours clients are in countable activities Example: Washington State

Up-Front Diversions Up-front assistance to help families avoid welfare and/or address barriers to employment before looking for work Clients in crises can receive cash assistance and services to address barriers States can help clients enter TANF program engaged in countable work activities and more ready for work Examples:Minnesota’s Diversionary Work Program Pennsylvania’s Work Support Component

Long-Term Strategies to Meet TANF Requirements Transitional Jobs Programs Short-term, integrated education and training programs Assessments, case management, and connections to other systems Redesign of job search/job readiness activities

Transitional Jobs Programs Provides TANF clients with paid, temporary work experience in supportive environment Typically for clients with lower skill levels Paid employment allows clients to qualify for tax credits Employers receive subsidies to cover wages, benefits and other costs of hiring TANF client

Short-Term Integrated Education and Training Programs Positive benefits of incorporating education and training activities into a work-focused strategy – applied learning tied directly to work Bridge programs to help clients quickly gain fundamental skills Programs aligned to needs of local labor market Employers engaged in design of programs Career pathways and sector strategies

Assessments, Case Management and Connections to Other Systems Upfront assessments to determine needs Coordinating case management services to provide a wide range of support Helping clients access other services and systems to address mental health, substance abuse, and vocational rehab needs

Redesign of Job Search and Job Readiness Activities Encouraging clients to seek higher quality jobs Helping clients finding employment in industries with historically higher wages Stressing importance of strategic job change Linking job search and job readiness to needs of local labor market

Challenges to engaging workforce system Most “surplus” dollars are gone. Shift in emphasis from workforce-TANF collaboration to workforce-economic dev. Duel constituency of workforce Family focus of TANF— “social services”

Both Systems Gain Burgeoning experience of workforce system (community colleges, voc. training) in creating career paths in high-wage, high-growth jobs. TANF $$’s can help spur further innovation. TANF recipients part of workforce pipeline to help meet skills shortage. Common vision of long-term economic well-being that includes making work pay, work supports, asset development and advancement.