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1 1 (December 12, 2018)

handle is hein.crs/govybh0001 and id is 1 raw text is: lnfrrr ig the' IiAive deat sinr11 Updated December 12, 2018 TANF Reauthorization: House Ways and Means Committee Majority Discussion Draft of May 8, 2018 The Temporary Assistance for Needy Families (TANF) block grant provides grants to states, tribes, and the territories for a wide range of benefits and services that seek to address the effects of and root causes of child poverty and economic disadvantage. Funding is set to expire on December 22, 2018, for TANF and related programs providing mandatory child care funding and responsible fatherhood and healthy marriage grants. On May 8, 2018, the House Ways and Means Committee majority released a discussion draft bill that would make policy changes and fund TANF through FY2023. TANF Purpose and Goals Under current law, TANF's purpose is to increase state flexibility to achieve four statutory goals: (1) provide assistance for needy families so that children may remain in their own homes; (2) end dependence of needy 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. The discussion draft would add a fifth statutory goal: to reduce the number of children in poverty by increasing the employment entry, retention, and advancement of their parents. TANF F nancing For FY2018, TANF provides grants to states in its basic block grant ($16.5 billion total) and contingency funds ($608 million). The TANF allocation to the states dates back to the 1996 welfare reform law, and is based on spending in the pre-TANF programs in the early- to mid- 1990s. In addition to federal funds, TANF requires states to spend a minimum of $10.3 billion per year in their own funds on TANF or TANF-related programs. This is known as the maintenance of effort requirement (MOE). This discussion draft would extend funding for the basic block grant through FY2023 at its current national level, but change its structure. The basic block grant would have two components: a fixed amount and a capped matching grant. The fixed portion of the grant would be 75% of its FY2018 grant. States would still have to fulfill an MOE requirement to receive these funds, albeit at a reduced level (75% of their FY2018 MOE requirement). Remaining funds would be provided to each state as a capped matching grant, with its expenditures on core activities related to assistance and work activities matched at its Medicaid matching rate (Federal Medical Assistance Percentage, FMAP). Each state's proportion of children living in poverty determines the allocation of its matching grant. Figure 1 shows TANF grants per poor child under current law. It shows that state grants are not evenly divided per child in poverty. Thus, the allocation of matching grants based on child poverty would change the distribution of funds. States with relatively low grants per poor child would gain funds; those with relatively high grants per poor child would lose funds. The Congressional Research Service (CRS) estimates that funding changes would range from an increase of 118% for Texas (assuming it draws down its full match) to a decline of 19.5% for the District of Columbia. Figure I. TANF Basic Block Grants Per Child in Poverty, by State FY2018 Grants; 2016 Child Poverty Counts $1,1 j 732 6 $ 41 25 $699 OK~ LA M S AL CA $68B $27 $44 $347 W TX fL $300 644 Grant Dollars per Child in Poverty Source: Congressional Research Service (CRS) based on data from the U.S. Department of Health and Human Services and the Census Bureau's Small Area Income and Poverty Estimates (SAIPE). Use of TANF Grants Under current law, states may expend federal TANF funds and count as MOE funds expenditures on benefits and services that aim to further TANF's broad purpose and statutory goals. Figure 2 shows TANF and MOE spending by category. Spending on basic assistance, which includes the monthly cash assistance checks that TANF is best known for, totaled $7.4 billion out of $30.9 billion, or 24% of TANF spending. Work activity spending of $2.8 billion accounted for an additional 9% of TANF spending. TANF funds are also used for child care, child welfare services (related to children in, or at risk of, foster care), early childhood programs, youth, and state spending on healthy marriage and responsible fatherhood programs. https://crsreports.congress.gov

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