Copyright 2001 eMediaMillWorks, Inc. 
(f/k/a Federal Document Clearing House, Inc.)  
Federal Document Clearing House Congressional Testimony
March 15, 2001, Thursday
SECTION: CAPITOL HILL HEARING TESTIMONY

LENGTH: 10062 words

COMMITTEE: HOUSE WAYS AND MEANS

SUBCOMMITTEE: HUMAN RESOURCES

HEADLINE: TESTIMONY WELFARE OVERHAUL EFFECTS

TESTIMONY-BY: MARK GREENBERG , SENIOR STAFF ATTORNEY

AFFILIATION: CENTER FOR LAW AND SOCIAL POLICY

BODY:
... Social Policy Testimony Before the Subcommittee on Human Resources of the House Committee on Ways and Means Hearing on Welfare Reform March 15, 2001 Mr. Chairman and Members of the Subcommittee: Thank you for inviting me to testify. I am a ...

... In addition, we often talk and visit with state officials, administrators, program providers, and individuals directly affected by the implementation of welfare reform efforts. Today's hearing focuses on the experience since 1996 in addressing the four goals of the Temporary Assistance ...

... reduced need - during this period, child poverty fell, from 21.8% in 1994 to 16.9% in 1999. However, participation in welfare fell much more rapidly than child poverty. In 1994, 62% of poor children were receiving AFDC assistance; by ...

... need of assistance chose not to apply or applied and were unable to get assistance. As discussed below, there is evidence that most families leaving welfare are working, but that many of these families remain poor; there is also evidence that a significant group of families have left welfare but are not working. It is less clear whether there has been a drop in applications or application approval rates. Under TANF, ...

... employment among TANF recipients, and more generally among female- headed families. The principal information about why families have left welfare has come from studies looking at the circumstances of families who have left assistance. These studies consistently find that about 60% of leavers are ...

... coverage for children, the minimum wage increase, improved child support enforcement. There seems to be a consensus among researchers that welfare reform efforts did play an important role, with the effects more pronounced in latter years. At the same time, ...

... worked in a different economy, or how one component would have worked without the others. When we talk about the effect of "TANF" or "welfare reform," it is important to appreciate that there are a number of components in what states have done under TANF. In formal rules, ...

... TANF implementation also meant an infusion of additional funds for states. Since funding levels were generally set to reflect welfare caseloads from the early-mid 1990s, and caseloads began falling in 1994, the effect of TANF from the beginning was to provide increased federal ...

... per month in FY 99. Leavers studies also report generally low wages and earnings for those who have left welfare and entered employment. According to the Urban Institute's Nation Survey of America's Families, the median wages for leavers in 1997 were $ ...

... a longer- term picture from this data. A limited number of states have reported longitudinal data for families leaving welfare and entering employment. From that data, it looks like earnings do increase after leaving assistance, but remain low. For ...

... quarter of employment. Probably the best longitudinal data comes from the Institute for Research on Poverty's tracking of families that left welfare in Wisconsin in 1995. In the IRP study, median earnings (in 1998 dollars) were $8608 in the first ...

... at the same time TANF cases were closed. There are also indications that families who could benefit from child care assistance after leaving welfare do not consistently receive such assistance. In state leavers studies with data on this issue, only about one third or ...

... month, and representing 19% of family income. Federal administrative data indicate that some child support is collected for 40% of welfare leavers. This probably reflects significant improvement in recent years, though a substantial share of leavers are still not ...

... recover prior assistance costs.) Families still receiving assistance are a heterogenous group, but generally have more serious barriers to employment than those who have left assistance. Most families now receiving assistance are either working or do not include an adult ...

... under sanction. State and local agencies often note that many of the families still receiving assistance are likely to have serious employment barriers. It is difficult to provide a precise picture, because the types of problems often identified - health and mental health, domestic violence, ...

... work, or very poor mental health; and 27% last worked three or more years ago. Most (56%) of those with no identified barrier to work were working; in contrast, only 20% of those with two or more barriers to work were working. People sometimes ask if the incidence of these problems is more severe now than was the case in the past. It is difficult to know, because most states have not had consistent measures of these potential obstacles over time. The Urban Institute found that the incidence of barriers in 1999 did not look substantially different from 1997. It is clear, though, that families still receiving assistance are much more likely to have multiple barriers to employment than families who have left. State leavers studies also consistently report that those still receiving assistance are likely to have less education and ...

... left. And, for many states, the key question isn't really whether the prevalence of these problems has increased, because five years ago, families with multiple barriers were typically exempt from program requirements. Now, these families are subject to work and time limit requirements, and states need to develop appropriate ...

... services for such families have become an increasingly significant challenge in TANF implementation. A group of families with serious barriers to employment is no longer receiving assistance. About 40% of families who have left assistance are not working. Generally, there is less ...

... living with spouses, partners, or other adults. However, there are indications that, as compared to working leavers, the nonworking leavers are likely to have more serious employment barriers -- e.g., less education and work history, greater likelihood of illness or disability. They are also likely to be poorer than working leavers. In a recent analysis, the Urban Institute focused on one group of nonworking leavers: those adults who had not worked since leaving, were not receiving disability benefits, and were not residing with a working spouse or partner. This group of "at risk" leavers was estimated to be 17% of all leavers, and they showed a greater likelihood of having multiple barriers to employment than current TANF recipients 50% of this group was in very poor health; 47% had not worked in at least ...

... years; 38% had less than a high school education; 19% were caring for a disabled child. Why are families with such severe barriers leaving assistance despite not working? There is a clear need for additional research, but one part of the explanation is ...

... work. The concern, then, is that at the same time that many states articulate a goal of working with those families with the most severe employment barriers, state practices are sometimes having the effect of terminating assistance to those families. Some states have responded to these concerns by developing "second look" ...

... efforts, and the federal government does not collect information on state practices to avoid terminations of assistance to families with multiple employment barriers. The large gains in employment have resulted in increased income for many female-headed families; at the same ...

... light of recent work by the Manpower Demonstration Research Corporation, looking at experimental studies to examine the impact of work-welfare initiatives on children. MDRC found that while many programs raised employment rates, only some raised income, because ...

... may not be sufficient to boost the healthy development of children in low-income families." Morris, et. Al, How Welfare and Work Policies Affect Children: A Synthesis of Research (Manpower Demonstration Research Corp. 2001). The TANF caseload decline has ...

... uncertain whether the caseload decline would continue, and they were often unclear about when and how TANF funds could be used for expenditures outside of the traditional welfare system. A key shift occurred when HHS issued final TANF regulations in April 1999. These regulations made ...

... flexibility in using TANF, explaining that states could use the funds to benefit "needy families" whether or not those families were receiving traditional welfare assistance and that states could use TANF to structure supports for working families outside the traditional welfare system. In exercising this new flexibility, the clearest response has been in committing resources to child care. States can transfer ...

... clearly slowed and perhaps stopped during the 1990s. At the same time, it seems to be the case that the dramatic declines in welfare participation and increases in employment have, at least to date, not yet been associated with equally dramatic changes in out of wedlock birth patterns. In 1996, some observers argued that welfare itself was a principal factor accounting for the rise of out of wedlock births in the United States, and that to alter these trends, it was necessary to eliminate or curtail the availability of assistance for single parent families. It is possible that reduced welfare participation and increased employment will eventually result in significant changes in family formation. However, it is not yet apparent whether that is occurring, and the other possibility is that the role of welfare benefits in contributing to out of wedlock births may have been overstated. A TANF provision provides $100 million a ...

... only limited discussion in 1996 of what Congress expected states to do to advance these goals - for many, it was assumed that reducing welfare caseloads was the intended strategy toward accomplishing them. However, as discussions of the family formation goals of TANF have increased, it seems clear that states ...

... reduced out of wedlock births and reduced marital break-ups. And, the evaluation of the Minnesota Family Investment Program found that a welfare reform effort that expanded eligibility for two-parent families, combined a work requirement with a modest sanction ( ...

... through strong emphases on work and child support. Government can also seek to ensure that its policies are not having the effect of creating barriers to marriage and family formation. At the same time, the focus on family formation in TANF draws from a concern ...