DC TANF Families Far Below Poverty Line, Even With Uncut Benefits

November 20, 2014

Shortly before the election, Washington Post reporter Rachel Weiner observed that none of the mayoral candidates had even mentioned “a dramatic change in the city’s welfare program that could drag many poor families into further distress.”

She was referring to the District’s decision to phase out Temporary Assistance for Needy Families benefits to families who’ve received them for a lifetime total of five years. The DC Council suspended the phase-out after the first cut — and for good reasons, as Weiner indicates.

But the cuts have gone forward again. They’re likely to leave more than 6,000 families with no cash assistance whatever come next September — unless the Council and soon-to-be Mayor Bowser agree to change the law.

But what about families whose benefits haven’t been cut? Not much of a safety net for them, as the Center on Budget and Policy Priorities’ recent state-by-state update on the benefits shows.

CBPP looks at the maximum cash benefit a single parent with two children can receive. That was $428 in the District when the Center did its analysis.

A provision in the latest Budget Support Act, i.e., the package of legislation that’s paired with the budget proper, provides for a cost-of-living adjustment this fiscal year, based on the Consumer Price Index.

That, I’m told, will boost benefits by 1.5% — just making up for what our three-person family’s benefit lost in value due to inflation during the July 2013-14 period.

The family will still have an income at about 26% of the federal poverty line. And it will be considerably worse off than three-person families were when TANF began.

Adjusting for inflation, the maximum benefit for our D.C. family has lost about a third of its real-dollar value. Losses were smaller in more than half the states.

And, as we all know, the cost of living here is higher than in most places. CBPP provides just one measure — the gap between the maximum TANF benefit for three-person families and the fair market rents the U.S. Department of Housing and Urban Development set for a modest two-bedroom apartment.

The pre-COLA maximum benefit for our D.C. family is 29.1% of the FMR for the apartment. In other words, the family couldn’t come anywhere near to paying for it, even if it spent its entire benefit on rent.

This is true for families in every state, but the rent shortfall is greater than the District’s in only two — Mississippi and Tennessee. Not, I suppose, states the District would choose as benchmarks.

Rankings of this sort aren’t nearly as relevant as the measures of how woefully inadequate TANF benefits are — and how more woefully in adequate they’ve become over time.

So far as housing is concerned, the maximum for our D.C. family would have covered nearly 44% of the FMR in 2000 — still a very large shortfall, but smaller because the benefit was worth more and rents in our area hadn’t skyrocketed.

Now, it’s true that some TANF families in the District have more cash income than the maximum benefit indicates because our local program exempts a fair amount of earned income when setting benefit levels.

Also true, however, as indicated above, that many families are receiving far less than the maximum. The phase-out alone has left some three-person families with as little as $152 a month.

Most, if not all of the families, however, receive a separate cash-equivalent benefit from SNAP (the food stamp program). Yet the cash value of SNAP benefits still leaves TANF families far below the poverty line.

CBPP shows this by combining the average monthly SNAP benefit for TANF families with the maximum the three-person family can get from TANF. With the two benefits, so defined, our D.C. TANF family was at 54.4% of the FPL in July.

But, says CBPP, this is probably an overstatement for many families because the average SNAP benefit it calculated assumes housing, plus utility costs high enough to qualify families for the maximum.

No such costs for the families in the DC General shelter, most of whom depend on TANF benefits. And lower costs, if any that families can claim if they’re doubled-up with accommodating friends or relatives.

There could be fewer homeless families if the District substantially increased TANF benefits now, as originally proposed, and modified the phase-out to preserve benefits for families who’d otherwise become destitute, even though the parents had done everything they were told to.

These could include families with a parent who’s working, but not able to earn enough to support herself and her kids and those with a parent who isn’t working because jobs she could qualify for are just too scarce.

And then perhaps there are parents who didn’t do everything they were told to because they couldn’t, e.g., those with certain intellectual disabilities or PTSD that caseworkers had failed to identify.

But such exemptions would still leave some families subject to phased-out benefits that would sink them even deeper in poverty than they already are — and less likely to achieve the self-sufficiency that TANF is supposed to promote.

How can you focus on preparing for — or seeking — work when you’re trying to figure out where you and your kids will spend the night or how you’ll feed them now that you’ve run through your monthly SNAP benefit?

Problems even for parents who are still within the rigid time limit now.

 


TANF Safety Net Keeps Fraying

December 19, 2011

Safety nets are supposed to catch people when they fall so they don’t crash to the ground. So too with what we call safety net programs. We’ve created them so that people don’t land in desperate poverty.

We’d thus expect safety net programs to catch more people when the economy tanks, as it did in late 2007. We’d expect them to provide enough aid to serve their basic purpose, i.e., ensuring that needy people have enough to eat, a roof over their heads, essential medical care, etc.

By this modest measure, the Temporary Assistance for Needy Families program has egregiously failed — no surprise, given past performance.

A new brief from the Center on Budget and Policy Priorities confirms this with two updated perspectives on the TANF safety net — what portion of poor families with children is it catching and how much is it helping those caught to meet their basic needs.

TANF Enrollment

TANF was created in 1996 to replace AID to Families with Dependent Children —  a program under which the federal government provided states with matching funds based on what benefits were costing and need.

“Welfare reform” converted this scheme to a fixed-sum block grant, plus a Contingency Fund states could draw on during hard economic times — until the Fund ran dry.

At the time, AFDC was providing cash assistance to 68% of poor families with children. Participation rates have been steadily falling — and not because fewer families were poor enough to need aid.

TANF did expand slightly — by 13% — after the recession set in. But in 2009, only 27% of families in poverty received any cash assistance from the program.

Cash Benefits

TANF cash benefits started out low — an average of about $395.50 a month for a family of three.

As of 2008, 28 states and the District of Columbia had increased the nominal value of the benefits they provided, but fewer than half enacted increases big enough to even keep pace with inflation.

Since then, inflation has continued to make dollars worth less. But most states have frozen benefit levels. Six states and the District have actually cut them.*

A perfect storm of reasons for this — mostly attributable to federal policies. Most important perhaps are the year-after-year failure to increase funding for the block grant and rules that allow states to use TANF funds for more politically-popular programs.

Add to these two recent decision by our penny-pinching Congress.

The first was to let the TANF Emergency Contingency Fund die, thus denying states more of the extra funding the Recovery Act had provided to help them cope with recession-related pressures.

The second, more recent denied 17 mostly poor states supplemental funds they’d been receiving since TANF was created and, at the same time, cut back what had already been approved for the regular Contingency Fund.

I don’t want to let states — or the District — off the hook here. They’ve been choosing to economize on TANF cash benefits for a long time. Even in tough economic years like these, budgets are choices.

Nevertheless, the federal partner has been shirking its share of responsibility for maintaining the TANF safety net — and allowing states to shirk theirs as well.

End result is that:

  • TANF cash benefits are worth less now than in 1996 in all but two states.
  • They’ve declined by at least 20% in 34 states and the District.
  • No state provides benefits that lift a family of three out of extreme poverty, i.e., above 50% of the federal poverty line.
  • In 29 states and the District, benefits for the family are below 30% of the FPL.
  • They’re below 20% in 14 states, nine of which have lost their supplemental grants.

This unfortunately may not be the worst of the bad news.

As CBPP earlier reported, a number of states have already projected budget shortfalls for Fiscal Year 2013.

They could face gaps they hadn’t expected due to the automatic spending cuts the debt ceiling/deficit reduction deal will trigger — or cuts Congress may pass to avert them.

* Unlike most of the state cuts, the District’s cut applies to families who’ve participated in TANF for a total of more than five years. And it’s progressive — first 20% less, then 25% less till there’s nothing left. The DC Council deferred the second round of cuts, but they’re scheduled to resume in 2013.