Temporary Assistance for Needy Families (TANF)
The Personal Responsibility and Work Opportunity Reconciliation Act, implemented in 1996, ended the national entitlement to welfare for families with dependent children and created Temporary Assistance for Needy Families (TANF), a block-grant program that gives states the flexibility needed to reform their welfare systems.
In The Heartland Institute’s 2015 Welfare Reform Report Card, Mississippi receives a C- grade and ranks 29th for its anti-poverty TANF policies. While Mississippi has successfully reduced its number of TANF recipients since 1996, its overall poverty rate has continued to increase. According to data from the U.S. Census Bureau’s Small Area Income and Poverty Estimates program and information from the Annie E. Casey Foundation, Mississippi’s poverty rate increased by 15.4 percent from 1996 to 2013.
Proponents of the current welfare policies in Mississippi argue many people in poverty need aid from the state, but reformers understand the system requires taxpayers to pick up the bill for failed programs that can destroy opportunities for impoverished citizens.
In fiscal year 2006, Mississippi temporarily employed a cash diversion program to assist with the devastation caused by Hurricane Katrina. Since then, Mississippi has failed to follow the lead of 33 other states that have a cash diversion program in place that allows case workers to make grants to qualified people who need short-term assistance. Without a cash diversion program, many people who find themselves in difficult financial situations end up enrolling in TANF, which needlessly creates more dependency.
Mississippi maintains the highest recommended limit of lifetime eligibility for individuals and families, 60 months, under the 1996 welfare reform law. In recent years, many states have adopted policies limiting access to certain welfare programs to less than 60 months, because five years of dependence on welfare can ingrain habits and lifestyles that make it very difficult to achieve self-sufficiency.
Other states have also increased the integration of welfare and state social services by co-locating service providers, which helps government bureaucracies share information and gives caseworkers more flexibility to direct their clients to the services they need.
Supplemental Nutritional Assistance Program (SNAP)
Welfare reform should focus on encouraging able-bodied recipients who are enrolled in these programs to become more self-sufficient and less dependent on government aid. Asset tests are one tool states can use to ensure all food stamp dollars are used only by those families truly in need. Currently, 14 states require an asset test to receive food stamps.
The current income and asset test for the Supplemental Nutritional Assistance Program (SNAP) requires recipients to have a gross income below 130 percent of the poverty level, a net income below 100 percent of the poverty level, and less than $2,000 in assets, but many SNAP recipients are accepted under looser standards through “categorical eligibility.” In states using categorical eligibility for SNAP, recipients are determined not by the income and asset limitations established for SNAP, but by participation in other cash welfare assistance programs, which can have more relaxed eligibility standards.
Mississippi’s current set of welfare and anti-poverty programs disincentivize work, trapping welfare recipients in long-term poverty. Legislators should continue to reform Mississippi’s welfare system by adopting policies that improve opportunities for upward mobility and self-sufficiency while also protecting the truly needy.
The following documents provide additional information about welfare reform.
Welfare Reform Report Card: A State-by-State Analysis of Anti-Poverty Performance and Welfare Reform Policies
In 2015, The Heartland Institute published an updated version of its Welfare Reform Report Card. This report card compiles extensive data on five “inputs” and five “outputs” of state welfare and anti-poverty programs and assigns a final grade to each state based on the strength of the welfare policies it has adopted. In this report card, Mississippi receives a C- grade and ranks 29th for its anti-poverty policies.
Welfare Reform after Ten Years: A State-by-State Analysis
In 2008, The Heartland Institute published Welfare Reform after Ten Years: A State-by-State Analysis, which reports the welfare policy choices of all 50 states and the District of Columbia. The report ranks the states by how aggressively they implemented effective policies. This data provide policymakers with a roadmap to successful anti-poverty efforts.
The Work Versus Welfare Tradeoff: 2013
In this report from the Cato Institute, researchers estimate the value of the full package of welfare benefits available to a typical recipient in each of the 50 states and the District of Columbia. They found welfare benefits outpace the income most recipients can expect to earn from an entry-level job, and the report reveals the income gap between welfare and work may have grown worse in recent years.
Comparing Program Participation of TANF and Non-TANF Families Before and During a Time of Recession
Shelley K. Irving examines whether participation in the Temporary Assistance for Needy Families program has increased and whether employment has decreased during the economic downturn. The study also compares participation in other assistance programs based on welfare and poverty status from 2006 to 2009.
Welfare Rules Database
The Urban Institute’s Welfare Rules Database website provides a “comprehensive, sophisticated resource for comparing cash assistance programs between states” and allows researchers to examine changes in cash assistance rules between states.
Implementing Welfare Reform: A State Report Card
Writing for the Cato Institute in 2004, Jenifer Zeigler analyzes state welfare reform implementation and identifies reform policies that were most effective at encouraging personal responsibility and self-sufficiency.
Reforming Food Stamps to Promote Work and Reduce Poverty and Dependence
Robert Rector of The Heritage Foundation says applying work requirement standards similar to TANF to the food stamps program would help improve self-sufficiency: “The replacement of AFDC with the Temporary Assistance to Needy Families program (TANF) has led to record declines in dependence and poverty. Since the creation of TANF, we have learned that welfare programs with work requirements will reduce poverty more effectively than similar programs without work requirements. It is time to apply the lessons from AFDC reform to Food Stamps.”
The Supplemental Nutrition Assistance Program: Categorical Eligibility
Gene Falk and Randy Alison Aussenberg of the Congressional Research Service discuss categorical eligibility and some of the problems it causes. They describe the three different types of categorical eligibility: traditional categorical eligibility conveyed through receipt of need-based cash assistance and the newer “narrow” and “broad-based” categorical eligibilities conveyed via TANF “noncash” benefits. They also provide information on current state practices regarding categorical eligibility and discuss proposals to restrict TANF-based categorical eligibility.
Nothing in this Research & Commentary is intended to influence the passage of legislation, and it does not necessarily represent the views of The Heartland Institute. For further information on this subject, visit Budget & Tax News at http://news.heartland.org/fiscal, The Heartland Institute’s website at http://heartland.org, and PolicyBot, Heartland’s free online research database, at www.policybot.org.
The Heartland Institute can send an expert to your state to testify or brief your caucus; host an event in your state; or send you further information on a topic. Please don’t hesitate to contact us if we can be of assistance! If you have any questions or comments, contact Logan Pike, Heartland’s state government relations manager, at [email protected] or 312/377-4000.