1. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 1 Welfare Reform & Beyond PowerPoint Presentation The Brookings Institution Spring 2002

2. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 2 Session 1 Overview and History of Welfare Reform

3. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 3 Poverty Rates for Children in the U.S. Have Been Higher than Those for Other Age Groups 65 years and over Under 18 years 18 to 64 years Source: U.S. Census Bureau 16.2 10.2 9.4

4. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 4 Two Views of Poverty The poor are victims of their circumstances and do not have opportunities to advanceThe poor are victims of their circumstances and do not have opportunities to advance The poor are responsible for their circumstances and do not take advantage of available opportunitiesThe poor are responsible for their circumstances and do not take advantage of available opportunities The emphasis of antipoverty policy in the U.S. has shifted between these two viewsThe emphasis of antipoverty policy in the U.S. has shifted between these two views The Personal Responsibility and Work Opportunity Reconciliation Act of 1996 emphasizes the second viewThe Personal Responsibility and Work Opportunity Reconciliation Act of 1996 emphasizes the second view

5. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 5 The Measurement of Poverty The Census Bureau uses a set of money income thresholds that vary by family size and composition to determine who is poorThe Census Bureau uses a set of money income thresholds that vary by family size and composition to determine who is poor The poverty thresholds do not vary geographically; they are updated annually for inflation but they have not kept pace with rising real incomesThe poverty thresholds do not vary geographically; they are updated annually for inflation but they have not kept pace with rising real incomes In determining who’s poor the Census Bureau counts money income before taxes and does not include non-cash benefits, the EITC, or work-related expenses. The National Academy of Sciences has recommended changes to deal with these and other issues. The thresholds in 2000 were:In determining who’s poor the Census Bureau counts money income before taxes and does not include non-cash benefits, the EITC, or work-related expenses. The National Academy of Sciences has recommended changes to deal with these and other issues. The thresholds in 2000 were: 1-person under 65$8,959 3-person family (adult and 2 children) 13,874 4-person family (adult and 3 children) 17,524 Source: U.S. Census Bureau

6. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 6 Countries that Spend More on Social Welfare (as percent of GDP) Have Lower Child Poverty Rates Cash and noncash social expenditures exclude health, education, and social services, but include all forms of cash benefits and near-cash housing subsidies, active labor market program subsidies, and other contingent cash and near-cash benefits. Nonelderly benefits include only those accruing to household heads under age 65. Source: Institute for Research on Poverty (IRP), University of Wisconsin-Madison

7. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 7 Government Benefits Lift Children Out of Poverty Source: Center on Budget and Policy Priorities; U.S. Census Bureau

8. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 8 Poverty is Related to Work and Family Structure Source: U.S. Census Bureau

9. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 9 Political Background to the 1996 Welfare Reform Legislation

10. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 10 Overview of the Aid to Families with Dependent Children Program (AFDC) Established in 1935 as part of the Social Security ActEstablished in 1935 as part of the Social Security Act Shared cost program between federal government and statesShared cost program between federal government and states Originally intended primarily for widows, AFDC increasingly served never-married mothersOriginally intended primarily for widows, AFDC increasingly served never-married mothers States had discretion primarily over setting income eligibility limits and benefit levelsStates had discretion primarily over setting income eligibility limits and benefit levels Activity requirements were weak and generally focused on education and training rather than workActivity requirements were weak and generally focused on education and training rather than work States were not allowed to time limit beneficiariesStates were not allowed to time limit beneficiaries Beginning in early 1990s, states increasingly used waivers to try new approaches to reducing welfare dependenceBeginning in early 1990s, states increasingly used waivers to try new approaches to reducing welfare dependence

11. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 11 Characteristics of the AFDC Caseload Majority are racial and ethnic minoritiesMajority are racial and ethnic minorities 4 percent of mothers in 1995 worked full-time, and another 5 percent worked part-time4 percent of mothers in 1995 worked full-time, and another 5 percent worked part-time Total expected duration of all Awelfare spells@ was 13 years; more than 76 percent were expected to stay on for more than 5 years totalTotal expected duration of all Awelfare spells@ was 13 years; more than 76 percent were expected to stay on for more than 5 years total

12. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 12 Efforts at Comprehensive Welfare Reform Usually Failed Nixon’s Family Assistance Plan (1969-1972)-- failed to pass CongressNixon’s Family Assistance Plan (1969-1972)-- failed to pass Congress Carter’s Program for Better Jobs and Incomes (1977)--failed to pass CongressCarter’s Program for Better Jobs and Incomes (1977)--failed to pass Congress Reagan’s 1981 Budget Act changes--moderate cutbacksReagan’s 1981 Budget Act changes--moderate cutbacks Reagan’s New Federalism (1982)--never introduced in CongressReagan’s New Federalism (1982)--never introduced in Congress Family Support Act (1988)--incremental reformFamily Support Act (1988)--incremental reform

13. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 13 Why Did Welfare Reform Legislation Pass in 1996 After Many Previous Failures Dramatic caseload increases after 1988 fostered perception that program was “out of control”Dramatic caseload increases after 1988 fostered perception that program was “out of control” Public opinionPublic opinion –Public opinion had not united around all of the proposals in PRWORA: public had shifted to overwhelming support for work requirements for custodial parents, while remaining more divided on “hard time limits” and family caps –Republicans in Congress were not trusted more than President Clinton on welfare reform issues in 1996 –The AFDC program was very unpopular because seen as anti-work and anti-family. The public was willing to accept almost any alternative to the status quo

14. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 14 Social Science knowledge and evaluation studiesSocial Science knowledge and evaluation studies –increased policymaker concern about intergenerational transmission of welfare receipt and length of welfare spells –gave support to “work first” approaches Budgetary considerations: Republicans needed to find budget savings (especially from cuts in Food Stamps and benefits to legal immigrants) in order to finance tax cut and budget balancing promises in the Contract with AmericaBudgetary considerations: Republicans needed to find budget savings (especially from cuts in Food Stamps and benefits to legal immigrants) in order to finance tax cut and budget balancing promises in the Contract with America State experiments under waivers increased confidence in innovative capacity of statesState experiments under waivers increased confidence in innovative capacity of states Why Did Welfare Reform Legislation Pass in 1996 After Many Previous Failures Cont.

15. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 15 Critical role for political bargaining:Critical role for political bargaining: –Bill Clinton promised to “end welfare as we know it” –Republicans in Congress committed to welfare reform by Contract with America –Moderate Democrats in Congress followed President Clinton to the right in order to avoid being seen as more liberal than President Clinton on welfare issues Why Did Welfare Reform Legislation Pass in 1996 After Many Previous Failures Cont.

16. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 16 Session 2 A Primer on the Major Programs

17. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 17 Overview of the 1996 Welfare Reform Law Temporary Assistance for Needy FamiliesTemporary Assistance for Needy Families Non-marital BirthsNon-marital Births Supplemental Security Income for ChildrenSupplemental Security Income for Children Child Support EnforcementChild Support Enforcement Welfare for Non-citizensWelfare for Non-citizens Child CareChild Care Food StampsFood Stamps

18. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 18 1. End Cash Entitlement 2. Block Grant Funding 3. Work Requirements 4. Sanctions 5. 5-Year Time Limit Five Components of TANF

19. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 19 1. Provide assistance to needy families with children children 2. End welfare dependency by promoting job preparation, work and marriage preparation, work and marriage 3. Prevent non-marital pregnancies 4. Encourage formation and maintenance of two-parent families two-parent families Purposes of TANF

20. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 20 Provisions in Welfare Reform Law Designed to Reduce Non-marital Births Congressional findings on the negative effects of non-marital birthsCongressional findings on the negative effects of non-marital births Three of four TANF purposes address family formationThree of four TANF purposes address family formation Performance bonuses tied to purposes of lawPerformance bonuses tied to purposes of law Illegitimacy reduction bonusIllegitimacy reduction bonus Require teens to attend schoolRequire teens to attend school Require teens to live at home or other supervised settingRequire teens to live at home or other supervised setting Abstinence educationAbstinence education Child support enforcementChild support enforcement Paternity establishmentPaternity establishment National goals to prevent teen pregnancyNational goals to prevent teen pregnancy States establish numerical goals for reducing non-marital birthsStates establish numerical goals for reducing non-marital births Annual ranking of states on non-marital pregnancy ratios by HHSAnnual ranking of states on non-marital pregnancy ratios by HHS Allow family capAllow family cap Allow reduction in cash benefits for non-marital birthsAllow reduction in cash benefits for non-marital births

21. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 21 Elements of the Work Support System Earned Income Tax Credit (EITC)Earned Income Tax Credit (EITC) Food Stamps and Child NutritionFood Stamps and Child Nutrition Medicaid and SCHIPMedicaid and SCHIP Child CareChild Care HousingHousing Child Tax CreditChild Tax Credit Child Support EnforcementChild Support Enforcement Workforce Development & Job Advancement ServicesWorkforce Development & Job Advancement Services State Income SupplementsState Income Supplements

22. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 22 Support for Working Families Increases Dramatically, 1984-1999 Source: Congressional Budget Office 5.6 51.7 Spending in 1999 under: 1984 Law 1999 Law

23. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 23 Session 3 How States Have Responded

24. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 24 Under TANF States Have Discretion To: Set eligibility limits and benefit levels for cash benefits (as before)Set eligibility limits and benefit levels for cash benefits (as before) Define who receives various benefits and servicesDefine who receives various benefits and services Set income supplements for working familiesSet income supplements for working families Offer other “carrots”Offer other “carrots” Set stricter “sticks” than those in federal lawSet stricter “sticks” than those in federal law Spend funds on a variety of services other than cash benefitsSpend funds on a variety of services other than cash benefits Save block grant funds for economic downturnsSave block grant funds for economic downturns

25. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 25 States Have Very Different Resources Under the TANF Block Grant

26. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 26 Most States Have Allowed Maximum Benefit Levels to Continue to Decline with Inflation Between 1994 and 2000 maximum benefits for a family of 3: Declined more than inflation in 7 statesDeclined more than inflation in 7 states Declined equal to inflation in 29 statesDeclined equal to inflation in 29 states Declined less than inflation in 12 statesDeclined less than inflation in 12 states Increased in real terms in 3 statesIncreased in real terms in 3 states

27. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 27 Many States Have Enacted Earnings Supplementation Policies to Help Low-income Working Families 47 states have changed earnings disregard policies47 states have changed earnings disregard policies 16 states have adopted state earned income credits16 states have adopted state earned income credits And enacted other policies to help them work: All states adopted more generous auto asset policiesAll states adopted more generous auto asset policies 44 states increased asset limits44 states increased asset limits 40 states ended 100-hour work limit for two-parent families40 states ended 100-hour work limit for two-parent families 11 extend Transitional Medicaid eligibility beyond 12 months11 extend Transitional Medicaid eligibility beyond 12 months

28. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 28 TANF and State EITC Policies do not Provide Substantial Earnings Supplementation to Many Low-income Working Families In the 13th month of benefit receipt: 4 states would give a family of 3 working 20 hours per week at minimum wage nothing, 21 less than $200 per month, and 26 more than $200 per month4 states would give a family of 3 working 20 hours per week at minimum wage nothing, 21 less than $200 per month, and 26 more than $200 per month 22 states would give a family of 3 working 35 hours per week at minimum wage nothing, 21 less than $200 per month, and 8 more than $200 per month22 states would give a family of 3 working 35 hours per week at minimum wage nothing, 21 less than $200 per month, and 8 more than $200 per month 42 states would give a family of 3 working 35 hours per week at $8.00 per hour nothing, 7 less than $100 per month, and 2 more than $100 per month42 states would give a family of 3 working 35 hours per week at $8.00 per hour nothing, 7 less than $100 per month, and 2 more than $100 per month All figures are for 2000

29. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 29 Many States Have Enacted “Sticks” to Encourage Work Stronger than Those Required by TANF Initial Work Requirements: 43 states require work activities in less than 24 months43 states require work activities in less than 24 months 20 states do not exempt caregiver of youngest child of 6 months or older20 states do not exempt caregiver of youngest child of 6 months or olderSanctions: 15 states have 100% sanction for first-time violators15 states have 100% sanction for first-time violators 21 states have worst case sanction of 100% for at least three months21 states have worst case sanction of 100% for at least three months 22 states apply sanctions to food stamps or Medicaid22 states apply sanctions to food stamps or Medicaid Time Limits: 6 states have lifetime time limits less than 60 months6 states have lifetime time limits less than 60 months 14 states have intermittent time limits less than 60 months14 states have intermittent time limits less than 60 months

30. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 30 States are Responding to Time Limits in Very Different Ways A few states (e.g., MI, NY) will pay for those hitting time limits out of state fundsA few states (e.g., MI, NY) will pay for those hitting time limits out of state funds Some states will use state funds to pay benefits to children in families hitting time limitsSome states will use state funds to pay benefits to children in families hitting time limits Some states (e.g., WA) will exempt most families hitting caseloadsSome states (e.g., WA) will exempt most families hitting caseloads Ohio uses outreach to ensure that families hitting time limits retained eligibility for Food Stamps and MedicaidOhio uses outreach to ensure that families hitting time limits retained eligibility for Food Stamps and Medicaid

31. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 31 But Many States Have Also Been More Reluctant to Impose Strong “Sticks” to Discourage Non-marital Births  23 states adopted family caps, all by 1997  No states adopted teen mother exclusions

32. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 32 What Factors Explain Overall Patterns of State Policy Choices? Little evidence of race to the bottomLittle evidence of race to the bottom Some evidence of emulation of best practicesSome evidence of emulation of best practices For “sticks” policies, political factors are associated with more conservative policy choicesFor “sticks” policies, political factors are associated with more conservative policy choices States that receive larger TANF grants per poor person are likely to have more generous income supplementation policiesStates that receive larger TANF grants per poor person are likely to have more generous income supplementation policies

33. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 33 States Have Shifted their Funding Priorities Away from Cash Assistance. 19952000 Cash: $21.9 73% Admin: $3.4 11% JOBS: $1.6 5% Emergency Assistance: $3.2 11% Cash: $11.5 50% Admin: $2.4 11% Work activities: $2.3 10% Child care: $2.3 10% Other: $4.3 19% $ in billions $31.1 $22.8 Source: Congressional Research Servive

34. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 34 Proportion of TANF Funds That Were Left Unspent, 1997-2001 Source: Center on Budget and Policy Priorities

35. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 35 Implications for TANF Reauthorization Absence of “race to the bottom” weakens case for increased federal control of TANF choices-- but things may change during a recessionAbsence of “race to the bottom” weakens case for increased federal control of TANF choices-- but things may change during a recession States may respond to time limits in very different waysStates may respond to time limits in very different ways Poorer states need more resources to carry out more effective work support policiesPoorer states need more resources to carry out more effective work support policies States will need more resources to carry out both safety net and work support policies during a recessionStates will need more resources to carry out both safety net and work support policies during a recession

36. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 36 Session 4 Welfare Reform Results to Date I: Caseloads

37. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 37 AFDC/TANF Caseload, 1960-2001 *Based on nine month average (October 2000-June 2001); Recessions are noted by shaded area. Source: Congressional Research Service and U.S. Department of Health and Human Services 2.103*

38. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 38 Declines in Overall TANF Caseloads Since the Early 1990s Resulted From Hot EconomyHot Economy Welfare ReformWelfare Reform Policies to Make Work PayPolicies to Make Work Pay Source: Rebecca Blank, September 2001

39. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 39 Declines in Caseloads Have Varied Dramatically Across States

40. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 40 Differences in Federal Food Stamp Payments Do Not Compensate for TANF Funding Differences

41. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 41 Differences in States’ Rates of TANF Caseload Decline Result From: State policy choicesState policy choices –Strictness of work requirements, especially Immediate work requirementsImmediate work requirements Strict policies on exempting mothers of young childrenStrict policies on exempting mothers of young children –Strict sanctions policies –Generosity of benefits and earnings disregards State economic conditions (e.g., unemployment rates)State economic conditions (e.g., unemployment rates)

42. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 42 Caseload Change Has Been Inconsistent Across States Over the Past Year Source: Center for Law and Social Policy

43. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 43 The TANF Caseload is Changing Over Time increasing share of of cases are “child only”increasing share of of cases are “child only” increasing share of cases live in large citiesincreasing share of cases live in large citiesBut: national caseload does not show significant change in characteristics of those remaining on the rollsnational caseload does not show significant change in characteristics of those remaining on the rolls

44. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 44 Note: Recessions are noted by shaded area;* Participation for January-October, 2001 18440 * Annual Average Food Stamp Participation, 1969-2001 Source: U.S. Department of Agriculture

45. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 45 Participation Rates in the Food Stamp Program Have Fallen Dramatically Source: U.S. Department of Agriculture

46. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 46 Food Stamp Participation Rates Have Fallen Because : Low-income working families: –leave TANF without informing welfare office –unaware of eligibility –have trouble with office visits –are not willing to put up with “hassle State welfare offices: –“divert” families –erect barriers to avoid federal sanctions –do not follow up with TANF leavers Federal policies, especially quality control system

47. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 47 367 * Annual Average Number of Unemployment Annual Average Number of Unemployment Insurance Claims, 1967-2001 Source: U.S. Department of Labor Note: Recessions are noted by shaded area; *Average for January-November, 2001

48. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 Note: Recessions are noted by shaded area, *Average for January-February, 2002 Annual Average Unemployment Rate, 1961-2002 Source: Bureau of Labor Statistics 5.55*

49. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 49 TANF Leavers Who Lose Their Jobs Often Do Not Qualify for Unemployment Insurance Because: they leave work “voluntarily” because of child care problems, illness, etc.they leave work “voluntarily” because of child care problems, illness, etc. they have not worked enough or have insufficient earnings to qualify (most recent quarter issue)they have not worked enough or have insufficient earnings to qualify (most recent quarter issue) they are not available for full-time workthey are not available for full-time work

50. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 50 Small Percent of Eligible Families Receive Child Care Subsidies Studies show Child Care subsidies are received by only 12% of families who meet federal income eligibility guidelines and by less than half of those leaving welfareStudies show Child Care subsidies are received by only 12% of families who meet federal income eligibility guidelines and by less than half of those leaving welfare Many low-income families have access to unpaid or informal careMany low-income families have access to unpaid or informal care States ration care by:States ration care by: –Setting eligibility below the federally- permitted 85% of state median income –Establishing administrative processes and waiting lists that discourage applications –Co-payment requirements or limited reimbursement of providers Source: U.S. Department of Health and Human Services

51. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 51 Session 5 Welfare Reform Results to Date II: Economic Well-Being

52. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 52 Percentage of Married, Single, and Never-Married Mothers Working, 1985-2000 Source: Gary Burtless, The Brookings Institution, 2001

53. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 53 Overall Unemployment Rate Vs. Rate Among Women who Maintain Families Source: Bureau of Labor Statistics

54. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 54 State Leavers Studies: Employed After Leaving Welfare Source: Congressional Research Service

55. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 55 Work Pays Better than Welfare Source: Isabel Sawhill and Adam Thomas, Brookings Institution, 2001

56. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 56 Family Income by Source for Female Heads with Children (Bottom Fifth), 1993-2000 Source: U.S. Census Bureau Note: Components do not equal total because taxes are not shown

57. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 57 Source: U.S. Census Bureau Family Income by Source for Female Heads with Children (Second Fifth), 1993-2000 Note: Components do not equal total because taxes are not shown

58. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 58 Child Poverty Rates Have Fallen Since 1993 Percent in Poverty, 1960-2000 Percent in Poverty by Broader Definition, 1978-2000 Source: U.S. Census Bureau 1996: TANF Enacted 20.5% 12.2% 16.2% 9.6%

59. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 59 Measures of Food Insecurity Have Not Increased for Children in Households Percent of Food Insecure without Hunger Percent of Food Insecure with Hunger Source: U.S. Department of Agriculture

60. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 60 Child Victimization Rates, 1990-1999 Source: Congressional Research Service

61. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 61 Other Important Research on Impacts RAND Study Synthesizing Available Academic ResearchRAND Study Synthesizing Available Academic Research –Positive impacts on caseload, employment, earnings, poverty, and family income –Negative impacts on the use of Medicaid and food stamps –Uncertain but weakly positive effects on marriage and fertility MDRC Studies of Adult Outcomes Under State WaiversMDRC Studies of Adult Outcomes Under State Waivers –Work requirements increase employment and earnings but not income –Work requirements combined with earnings supplements do increase income MDRC Studies of Child Outcomes Under State WaiversMDRC Studies of Child Outcomes Under State Waivers –No adverse impacts from work requirements –Positive impacts when work requirements combined with earnings supplements for school aged kids –Some evidence of negative impacts for adolescents

62. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 62 Session 6 Welfare Reform Results to Date III: Family Formation

63. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 63 Family Formation Reducing Teen Pregnancy and ChildbearingReducing Teen Pregnancy and Childbearing Reducing Non-marital Childbearing Among AdultsReducing Non-marital Childbearing Among Adults Encouraging Unmarried Parents to Get MarriedEncouraging Unmarried Parents to Get Married Helping Married Parents Stay MarriedHelping Married Parents Stay Married Ensuring that Non-custodial Parents Fulfill their ResponsibilitiesEnsuring that Non-custodial Parents Fulfill their Responsibilities

64. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 64 Poverty Rate for Children in Female-Headed and Married-Couple Families, 1974-2000 Source: U.S. Census Bureau 27.9 4.7 36.4 5.3

65. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 65 The Impact of Changes in Family Structure on Child Poverty Rates Source: Isabel Sawhill and Adam Thomas, Brookings

66. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 66 Teen Birthrate, 1980-2000 Source: National Center for Health Statistics

67. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 67 What Has Contributed to the Decline in Teen Pregnancy and Birth Rates? New or more effective efforts to prevent teen pregnancyNew or more effective efforts to prevent teen pregnancy New messages associated with welfare reformNew messages associated with welfare reform More conservative attitudesMore conservative attitudes Fear of AIDS and other STDsFear of AIDS and other STDs New forms of contraceptionNew forms of contraception

68. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 68 What Do We Know About Effective Teen Pregnancy Prevention Efforts? Two different multi-site programs with rigorous evaluation reduced pregnancies by one halfTwo different multi-site programs with rigorous evaluation reduced pregnancies by one half At least 4 different sex education curricula have been carefully evaluated and found to be effectiveAt least 4 different sex education curricula have been carefully evaluated and found to be effective Programs that teach about contraceptives do not increase sexual activityPrograms that teach about contraceptives do not increase sexual activity Jury still out on abstinence educationJury still out on abstinence education Media campaigns are a promising new approachMedia campaigns are a promising new approach Source: National Campaign to Prevent Teen Pregnancy

69. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 69 Number of Births, Birth Rate, and Percent of Births to Unmarried Women, 1940-2000 Source: National Center for Health Statistics 7.1 45.2 89.5 1345.9 3.79 33.2

70. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 70 Contribution of Teen Birth Rate to Nonmarital Birth Ratio Source: National Center for Health Statistics, 2000 and 2001.

71. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 71 Source: U.S. Census Bureau 85.2 69.9 Percent of Children Living with Two Natural, Step, or Adoptive Parents

72. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 72 Child Support Collections and Paternity Establishments Are Up Source: U.S. Department of Health and Human Services

73. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 73 Session 7 Issues for TANF Reauthorization I: Funding and Program Goals

74. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 74 Issue: Overall Level of TANF Funding Options: Maintain current funding level (TANF funding of $16.5 billion per year; States required to spend 75- 80% of FY 1994 level) Lower funding Adjust block grant for inflation Add adjustment mechanism for economic conditions

75. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 75 Issue: TANF Allocation Formula Options: Do nothingDo nothing Restore expired supplemental grantRestore expired supplemental grant Gradually adjust funding formula to give greater weight to number of poor children in a stateGradually adjust funding formula to give greater weight to number of poor children in a state Preserve grant levels for richer states, while adding funding for poorer states to bring them up to national median in per-poor-child allocationsPreserve grant levels for richer states, while adding funding for poorer states to bring them up to national median in per-poor-child allocations

76. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 76 Effect of Restoring Supplemental Grant on State Funding Differentials Note: Reinstated supplemental; total annual cost = $300 million

77. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 77 Effect of Adjusting TANF Grant for Inflation on State Funding Differentials* Inflation on State Funding Differentials*

78. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 78 Issue: TANF Funding and Recession Options: Do nothingDo nothing Restore and improve contingency fund, and change eligibility criteria to make it more accessible for statesRestore and improve contingency fund, and change eligibility criteria to make it more accessible for states Make TANF block grant explicitly counter-cyclical (e.g., by tying it to the unemployment rate)Make TANF block grant explicitly counter-cyclical (e.g., by tying it to the unemployment rate) Allow states to put TANF dollars in rainy day fundsAllow states to put TANF dollars in rainy day funds

79. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 79 Issue: Goals of TANF Options: Do nothingDo nothing Rewrite purposes to include poverty reductionRewrite purposes to include poverty reduction Rewrite purposed to include child well-beingRewrite purposed to include child well-being Rewrite purposes to give increased attention to marriage, responsible fatherhood, and/or teen pregnancy preventionRewrite purposes to give increased attention to marriage, responsible fatherhood, and/or teen pregnancy prevention Increase reporting on goals and outcomesIncrease reporting on goals and outcomes Revise rewards and penalties for performanceRevise rewards and penalties for performance

80. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 80 Session 8 Issues for TANF Reauthorization II: Family Formation

81. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 81 Issue: Teen Pregnancy Options: Do nothingDo nothing New emphasis on reducing teen pregnancyNew emphasis on reducing teen pregnancy –fund programs that work –establish a national clearinghouse on programs that work –make reducing teen pregnancy a purpose of the law Reauthorize abstinence educationReauthorize abstinence education –change funding level –give states more flexibility to define program –allow spending on programs that include information about birth control Tie the “illegitimacy bonus” in current law more closely to state effortsTie the “illegitimacy bonus” in current law more closely to state efforts Experiment with complete elimination of welfare benefits for young unwed mothersExperiment with complete elimination of welfare benefits for young unwed mothers

82. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 82 Options: Do nothingDo nothing Require state plans toRequire state plans to –describe activities to promote family formation and marriage marriage –review state programs’ treatment of single vs. married parents parents Grants for promoting marriage and reducing out-of-Grants for promoting marriage and reducing out-of- wedlock births wedlock births TANF set-aside for marriageTANF set-aside for marriage Demonstration and evaluation fundDemonstration and evaluation fund Issue: Marriage

83. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 83 Options: Do nothing Do nothing Changes in child support enforcement, Changes in child support enforcement, including pass-through including pass-through Education, training, employment programs Education, training, employment programs Demonstration and evaluation fund Demonstration and evaluation fund Issue: Responsible Fatherhood

84. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 84 Session 9 Issues for TANF Reauthorization III: State Flexibility and Tribal TANF

85. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 85 How Much State Flexibility? Time Limits and SanctionsTime Limits and Sanctions Work Participation StandardsWork Participation Standards Job Retention and AdvancementJob Retention and Advancement Tribal TANFTribal TANF

86. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 86 Issue: Time Limits Options: Do nothing: 5 year federal limit with 20% exemptionDo nothing: 5 year federal limit with 20% exemption End 5 year federal limit: let states decideEnd 5 year federal limit: let states decide Stop clock or allow earn back of time for work or other circumstancesStop clock or allow earn back of time for work or other circumstances Provide public jobs after time limitProvide public jobs after time limit Modify 20% exemptionModify 20% exemption

87. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 87 Issue: Sanctions Options: Do nothing: states must reduce or terminate benefits for non-complianceDo nothing: states must reduce or terminate benefits for non-compliance Require full-family sanctionsRequire full-family sanctions Prohibit full-family sanctionsProhibit full-family sanctions Require pre/post-sanction review and servicesRequire pre/post-sanction review and services Ensure that sanctions can be curedEnsure that sanctions can be cured

88. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 88 Issue: Work Participation Standards Options: No change: 50% of families in work activities 30 hours/week (90% for 2-parent families). Limits on education and training. Caseload reduction credit.No change: 50% of families in work activities 30 hours/week (90% for 2-parent families). Limits on education and training. Caseload reduction credit. Raise work participation ratesRaise work participation rates Increase number of required hoursIncrease number of required hours End higher rate for two-parent familiesEnd higher rate for two-parent families Allow more education, training, and treatmentAllow more education, training, and treatment Let states define allowable activitiesLet states define allowable activities Replace caseload reduction credit with employment creditReplace caseload reduction credit with employment credit Require assessments or universal engagementRequire assessments or universal engagement End state waiversEnd state waivers

89. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 89 Issue: Education, Training, Job Retention and Advancement Options: Do nothing: Some flexibility in current law; bonus for job entry, retention, wage gainDo nothing: Some flexibility in current law; bonus for job entry, retention, wage gain Strengthen performance goals and incentivesStrengthen performance goals and incentives Allow more education and training - alone or combined with workAllow more education and training - alone or combined with work Fund research and demonstration projectsFund research and demonstration projects

90. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 90 Issue: Making Work Pay and Supplementing Incomes Options: Do nothingDo nothing Raise the minimum wage and index it for inflationRaise the minimum wage and index it for inflation Add a second tier to EITC and integrate with Child Tax CreditAdd a second tier to EITC and integrate with Child Tax Credit Provide federal incentive for states to expand their EITCsProvide federal incentive for states to expand their EITCs Encourage states to strengthen work supports by increasing TANF fundingEncourage states to strengthen work supports by increasing TANF funding Improve application for food stamps and other non-cash benefits, provide incentives to increase accessImprove application for food stamps and other non-cash benefits, provide incentives to increase access Expand Medicaid coverage to parentsExpand Medicaid coverage to parents Increase funding for child careIncrease funding for child care

91. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 91 Issue: Tribal TANF Options: Do nothing: Tribes opt to run TANF; negotiate time limits/work requirements; define service areas/population. Funds transferred from state’s federal block grant.Do nothing: Tribes opt to run TANF; negotiate time limits/work requirements; define service areas/population. Funds transferred from state’s federal block grant. Create separate federal tribal block grantCreate separate federal tribal block grant Access to performance bonus and contingency fundAccess to performance bonus and contingency fund Strengthen ‘equitable access’ for tribal members served by statesStrengthen ‘equitable access’ for tribal members served by states Research, evaluation, technical assistanceResearch, evaluation, technical assistance Promote economic developmentPromote economic development

92. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 92 Session 10 Issues for TANF Reauthorization IV: Work Supports

93. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 93 Work Supports Make Work Pay and Supplement Income Child Care Provide Safety Net for Unemployed

94. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 94 Existing Work Supports Source: Congressional Budget Office 5.6 51.7 Spending in 1999 under: 1984 Law 1999 Law

95. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 95 Issue: Making Work Pay and Supplementing Incomes Options: Do nothingDo nothing Raise the minimum wage and index it for inflationRaise the minimum wage and index it for inflation Add a second tier to EITC and integrate with Child Tax CreditAdd a second tier to EITC and integrate with Child Tax Credit Provide federal incentive for states to expand their EITCsProvide federal incentive for states to expand their EITCs Encourage states to strengthen work supports by increasing TANF fundingEncourage states to strengthen work supports by increasing TANF funding Improve application for food stamps and other non-cash benefitsImprove application for food stamps and other non-cash benefits Expand Medicaid coverage to parentsExpand Medicaid coverage to parents Increase funding for child careIncrease funding for child care

96. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 96 Issue: Child Care Options: Do nothing; many new investments alreadyDo nothing; many new investments already Provide more federal funding for child careProvide more federal funding for child care More funding for Head Start and universal pre-KMore funding for Head Start and universal pre-K Allow states to spend a higher percentage of TANF money on child careAllow states to spend a higher percentage of TANF money on child care Increase quality set asides within child care block grantIncrease quality set asides within child care block grant

97. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 97 Issue: Providing a Safety Net for the Unemployed Options: Do nothing Provide a contingency fund to pay for increase in caseloads during recessions Reform Unemployment Insurance Encourage states to provide community service jobs

98. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 98 Session 11 Issues for TANF Reauthorization V: Immigrant Issues

99. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 99 Non-citizen Declines in Welfare Programs, 1994-1999

100. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 100 Issue: Non-citizens Options: Status Quo –1996 dividing line –5-year ban and permanent ban –eligibility variations across programs –exceptions for emergencies, education and training, etc. –order of decline: SSI, food stamps, TANF, Medicaid Expand some or all benefits for pre-1996 entrants Expand some or all benefits for post-1996 entrants –food stamps restoration; about $.4 billion per year –TANF; no federal cost, but unfunded mandate –Medicaid; about $2 billion per year –SSI; about $1-1.5 billion per year (without Medicaid)

101. Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002 101 This is the end of the presentation. If you are viewing this in Internet Explorer, click here to return to theclick here WR&B PowerPoint Presentation webpage.