HEARING ADVISORY: Davis Announces Hearing on State TANF Spending and Its Impact on Work Requirements

May 17, 2012 — Hearing Advisory   

Congressman Geoff Davis (R-KY), Chairman of the Subcommittee on Human Resources of the Committee on Ways and Means, today announced that the Subcommittee will hold a hearing to review State spending requirements in the Temporary Assistance for Needy Families (TANF) program and their interaction with TANF work requirements. The hearing will take place on Thursday, May 17, 2012 in 1100 Longworth House Office Building, beginning at 2:00 P.M.

In view of the limited time available to hear witnesses, oral testimony at this hearing will be from invited witnesses only. Witnesses will include a representative from the Government Accountability Office (GAO) as well as other public and private sector experts on State TANF spending policy and practice.  However, any individual or organization not scheduled for an oral appearance may submit a written statement for consideration by the Committee and for inclusion in the printed record of the hearing.


BACKGROUND:

The Temporary Assistance for Needy Families (TANF) program is designed to end the dependence of needy families on government benefits by promoting work, marriage, and personal responsibility. Unlike its predecessor, Aid to Families with Dependent Children, which was primarily a cash welfare program for poor families with children, the 1996 welfare reform law created TANF to fund a variety of services to help low-income parents get jobs and become self-sufficient.

States are required to engage 50 percent of adults in TANF families in work activities such as employment, on-the-job training, job search, and vocational education. In addition, States are required to spend a certain amount of State money (based on past State spending on low-income programs) to receive full Federal TANF block grant funds, called the State “maintenance of effort” or MOE requirement. However, recent reports indicate a rising number of States appear to be counting other State program spending and even non-State third party spending as TANF MOE spending. For example, a number of States now count volunteer hours as TANF MOE by multiplying volunteer hours by an estimated wage rate and then reporting this as “spending” in the TANF program. This evolution has also resulted in some States reporting significant “excess MOE” spending, which under a 1999 regulation allows States to reduce the share of welfare recipients expected to work in exchange for TANF benefits.

According to a September 2011 GAO report, in fiscal year 2009, 32 states claimed at least some “excess MOE credits.” Of those 32 states, 17 states would have failed to meet their work participation requirements without these credits, resulting in the loss of Federal TANF funds.

The American Recovery and Reinvestment Act of 2009 (ARRA) created a new one-time $5 billion funding stream for States called the TANF Emergency Fund, available in FYs 2010 and 2011.  Under the Emergency Fund, States received 80 percent reimbursement for their increased spending on cash assistance, subsidized employment, and one-time benefits provided to needy families. The availability of this new funding may have been one of the factors that spurred States to identify and report further increases in spending, a number of which relied on the counting of third-party expenditures as State MOE spending to qualify for this funding. Additional factors may have been States’ desire to increase MOE spending in order to receive funding from the TANF contingency fund and to respond to changes in the Deficit Reduction Act.

In announcing the hearing, Chairman Davis said, “Welfare reform in the 1990s established a new partnership between States and the Federal government to help families move from welfare to work.  In exchange for flexibility in operating the program, States agreed to meet Federal requirements to engage families in work activities and to continue investing State dollars for this purpose. However, recent reports suggest that these two key principles of reform may not be working as intended. The hearing will review this issue to ensure the Federal-State partnership continues to work toward helping families become self-sufficient.”


FOCUS OF THE HEARING:

The hearing will focus on TANF State MOE spending requirements and their interaction with TANF work requirements.


DETAILS FOR SUBMISSION OF WRITTEN COMMENTS:

Please Note: Any person(s) and/or organization(s) wishing to submit for the hearing record must follow the appropriate link on the hearing page of the Committee website and complete the informational forms. From the Committee homepage, https://waysandmeans.house.gov, select “Hearings.” Select the hearing for which you would like to submit, and click on the link entitled, “Click here to provide a submission for the record.” Once you have followed the online instructions, submit all requested information. ATTACH your submission as a Word document, in compliance with the formatting requirements listed below, by the close of business on Thursday, May 31, 2012. Finally, please note that due to the change in House mail policy, the U.S. Capitol Police will refuse sealed-package deliveries to all House Office Buildings. For questions, or if you encounter technical problems, please call (202) 225-1721 or (202) 225-3625.


FORMATTING REQUIREMENTS:

The Committee relies on electronic submissions for printing the official hearing record. As always, submissions will be included in the record according to the discretion of the Committee. The Committee will not alter the content of your submission, but we reserve the right to format it according to our guidelines. Any submission provided to the Committee by a witness, any supplementary materials submitted for the printed record, and any written comments in response to a request for written comments must conform to the guidelines listed below. Any submission or supplementary item not in compliance with these guidelines will not be printed, but will be maintained in the Committee files for review and use by the Committee.

1. All submissions and supplementary materials must be provided in Word format and MUST NOT exceed a total of 10 pages, including attachments. Witnesses and submitters are advised that the Committee relies on electronic submissions for printing the official hearing record.

2. Copies of whole documents submitted as exhibit material will not be accepted for printing. Instead, exhibit material should be referenced and quoted or paraphrased. All exhibit materials not meeting these specifications will be maintained in the Committee files for review and use by the Committee.

3. All submissions must include a list of all clients, persons, and/or organizations on whose behalf the witness appears. A supplemental sheet must accompany each submission listing the name, company, address, telephone, and fax numbers of each witness.

The Committee seeks to make its facilities accessible to persons with disabilities. If you are in need of special accommodations, please call 202-225-1721 or 202-226-3411 TTD/TTY in advance of the event (four business days notice is requested). Questions with regard to special accommodation needs in general (including availability of Committee materials in alternative formats) may be directed to the Committee as noted above.

Note: All Committee advisories and news releases are available on the World Wide Web at http://www.waysandmeans.house.gov/.

SUBCOMMITTEE: Human Resources