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                                                                                    Updated December  16,2020

The Temporary Assistance for Needy Families (TANF)

Block Grant


The Temporary  Assistance for Needy Families (TANF)
blockgrant was created in the PersonalResponsibility and
Work  Opportunity Reconciliation Act of 1996 (PRWORA,
P.L. 104-193). That law was the culmination of a series of
legislative changes that altered the rules for providing
benefits and services to needy families with children.


Public cash assistance to needy families with children has
its origin in the early 1900s state and locally financed
mother's pension programs that aided single mothers
(often widows) so that children could be rais edin their own
homes  rather than institutionalized. The Social Security Act
of 1935 provided federal funding for these programs with
the explicit goalto aid mothers so they would not have to
work and could stayhome to raise their children.
Post-1935 changes altered the context in which programs
for needy families with children operated. In 1939,
survivors' benefits were addedto Social Security, providing
social insurance benefits to widows and their children. The
increase in labor force participation among married motheis
altered views about whether government should aid single
mothers to stay at home. Families with children whose
fathers were alive but absent comprised more of the public
cash as sistance caseload. The caseload also became more
nonwhite. Cash assistance to needy families with children
becane  among the most controversialof socialprograms,
particularly beginning in the late 1960s as the cash
assistance caseloadhad its first large increase. Proposals to
replace or reform cash assistance for needy families were
debated across four decades, ultimately leading to the
enactment of PRWORA.

  The TANF Icl<Grant
The TANF  blockgrant's overallpurpose is to increase the
flexibility of statesto meet four statutorygoals:
(1) provide assistance to needy families so thatchildren
may remain in theirhomes; (2) reduce dependency ofneedy
parents on government benefits through work, job
preparation, and marriage; (3) reduce out-of-wedlock
pregnancies; and (4) promote the formation and
maintenance of two-parent families. PRWORA and the
creation of TANF altered the federalrules that applied to
states for their cash assistance programs. It also established
a broad-purpose block grant that provides funds to states to
address both the effects and rootcauses of childhood
economic dis advantage.

     F   CrGats~ and StaceFud
TANF  provides grants to the 50s tates, District of
Columbia, Puerto Rico,Guam, and the Virgin Islands.
American Indian tribes may also operate their own TANF


programs with federaldollars. Thebulkof TANF fundingis
in a basic blockgrant of $16.5 billion per year. Every year,
each state receives a fixed grant based on how much it
received in federal funding in the pre-1996 cash assistance
and related programs during the early - and mid-1990s.
Tribes also may receive grants based on mid-1990s
expenditures.
The TANF  block grant has not been increased since the
enactment of the 1996 welfare law. There has beenno
adjustment for inflation or population change. From1997 to
2020, the basic TANFblockgrant has lost 38% of its value
to inflation. During TANF's history, states have at times
received TANF  funds in addition to the basic block grant.
For FY2021, the only additional funding to states for TANF
is through the TANF contingency fund.
In addition to federal funding, states are required to expend
a minimum  amount of their own funds on the TANF-rehted
population and TANF-related programs (a total minimum
of $10.3 billion per year). This amount is also based on
historical expenditures in pre-TANF programs and is
known  as the maintenance of effort (MOE) requirement.
Some  states spend more than the minimum.


States may use federalblock grant and MOE funds in any
mannerthat is reasonably calculated to achieve TANF's
statutory purpose and goals. States have used TANF funds
for a wide range of benefits and services. In FY2019, a total
of $30.9 billion was spent by states fromfederal TANF and
state MOE funds. TANF  basic as sistance, including
monthly cash benefits to families with children, totaled $65
billion. In addition to assistance, TANF contributes to state
funds used for work and training programs, child care, pre-
kindergarten programs, programs to provideservices to
children who have been abused and neglected or are at risk
of it, and other services (youth activities, responsible
fatherhood and healthy marriage promotion).

Figure 1. Uses of Federal TANF  and State MOE
Funds, by Category: FY20  19
                     Tota=$30.9 Bilion
          Basicr.Er.e                        $65& a
            ch.~J Care     ss 0
    Wourc: Cion gnd Trasning   erc  $3.2 a
       Rendt T Heath  n       Ser  s (HH
         Pre-K K/wd Start    5. S 6
           Ch;,d Welfare     .25
           A.cons ratien  ': 2
 Ewergeocyand Short-Term Bernets  :   t3
          [7th r Sevcs  .......4.6B

Source: Congressional Research Service (CRS), based on datafrom
the Department of Health and Human Services (HHS).


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