NIFL: Policy Update

National Institute for Literacy

Policy Update

REPORT FROM WASHINGTON, D.C.

HOW TO PREPARE FOR WELFARE CHANGES
- Part II in a Series -
Welfare Reform Law Could Increase Demand for Adult Basic Education and Literacy

-- March 14, 1997 --

As states implement the welfare changes enacted last year, several unexpected developments are emerging that hold promise for maintaining -- and possibly expanding -- welfare recipients’ access to education and training. The first section of this update provides an overview of four of these opportunities. The second section reviews the basic structure of the law and discusses its likely impact on the literacy field over the next five years.

As states begin implementing the new welfare-to-work program, Temporary Assistance to Needy Families (TANF), four developments have opened the door for adult basic education and literacy programs to help more recipients get the skills they need for long-term self-sufficiency:

1. Recognizing that education is a key component of welfare reform for many recipients, the nation’s Governors have collectively asked Congress and the Administration for flexibility to count more education activities toward meeting work participation rates required by federal law.

2. Congress and the Administration have answered questions surrounding the “vocational educational training” provisions in the manner supported by the literacy field.

3. Due to declines in caseloads, many states have an unexpected federal funding surplus that they can choose to use for education activities.

4. Many states -- including some that had initially turned away from education -- are integrating adult education activities as a key component of their new welfare-to-work plans.

The extent to which our field seizes these opportunities will affect whether the 3.9 million adults now on welfare will have the skills they need to support themselves when their benefits expire permanently after five years of aid.

The nation’s Governors recently demonstrated support for incorporating educational activities as part of their welfare-to-work plans. At their winter meeting, the Governors came out in support of more flexibility around the law’s work requirement, stating:

“Governors are committed to a ‘work first’ approach that will quickly move recipients into employment while providing them with opportunities to develop skills that will lead to better paying jobs. Employers have indicated that they are willing to hire welfare recipients if they are ‘job ready’ -- that is, if they are literate, have good communications skills, and understand the requirements of the workplace...The Governors recommend... greater flexibility to count basic educational activities toward the work requirement.” (For a copy of the National Governors’ Association Policy Statement, “H.R.-36 Implementation of Welfare Reform” contact the NGA at 202/624-5300.)

The law encourages states to limit the number of recipients who can participate in education and training activities by only counting them toward the federal work requirement if they are included in a new category of activities called “vocational educational training.” Even then, these activities count only for one year per individual, and for no more than 20 percent of recipients.

Until recently, it was not clear whether the 20 percent limit applied to the state’s entire caseload or to the percentage required to be at work. States also did not know if -- or how -- the federal government would define “vocational educational training” through regulation. Congress and the Administration appear to be listening to the states on this issue: recent actions by both indicate that states -- not the federal government -- will define “vocational educational training” and that states can apply the 20 percent limit to the entire caseload. To count, however, programs will likely have to be combined with employment-related activities. States that choose to include education related to work as “vocational educational training,” can include significantly more welfare recipients in adult education and literacy programs.

In Congress, the March 6 draft technical corrections bill for TANF does not restrict the term “vocational educational training,” nor does it change the law to lower the 20 percent cap. Further, the U.S. Department of Health and Human Services recently issued a Policy Guidance Announcement to state agencies that administer TANF. The announcement makes clear that states can choose their own definitions of “vocational educational training” and allow 20 percent of the caseload to be in education and training and still count towards the work requirement. It states unequivocally that states will not be penalized in the future for their own reasonable interpretations of the law even if HHS later decides to regulate in those areas. (For a copy of TANF Policy Announcement No. TANF-ACF-PA-97-1, contact the Office of Family Assistance at 202/401-9500.)

TANF “locks in” federal welfare funding at approximately 1994 levels, based on each state’s past funding for Aid for Families with Dependent Children (AFDC), Emergency Assistance, and the Job Opportunities and Basic Skills program. Because the new block grant amount is based on recession years, when almost every state’s caseload was higher than it is now, most states are receiving more federal dollars this year under TANF than they would have received under AFDC. (AFDC funding was based on the size of each state’s caseload.) In other words, most states are getting the same amount of money they got in 1994 while being asked to serve fewer recipients.

These additional funds can be used for education activities, or for any other cost associated with moving recipients into the workforce. Because the law includes no new funding for meeting work requirements, it is important for recipients that states choose to invest these “surplus” funds in welfare-to-work efforts. Decisions on how the funds will be spent will be made by Governors and state legislators.

The declines in welfare caseloads create another opportunity for adult education by easing the pressure on states to put recipients to work quickly. This is because of the “caseload reduction credit.” States that have reduced their caseload since 1994 receive credit for meeting the TANF work requirements and must put fewer people to work.

For example, if a state’s welfare caseload has fallen 10 percent since 1994, then the state has to place only 15 percent of its current caseload in eligible work activities, rather than 25 percent. By reducing the number of recipients who must be in work activities immediately, this credit creates a greater opportunity for states to improve the skills of those who will be required to work in the future. Again, the decision about whether or not to seize this opportunity to invest now in more recipients’ skills will be made be state level policymakers.

A recent National Adult Education Professional Development Consortium survey of 25 states, “Welfare Reform Survey: Initial Indicators from the States,” found renewed interest in basic skills, even among states that initially turned away from education.

Among states reporting continued reliance on basic skills instruction as a plank in welfare reform, the survey found that some have been successful in continuing to offer stand-alone education activities, including GED instruction. The trend, however, is towards “work first” approaches and away from up-front basic skills instruction. States relying primarily on postsecondary institutions or vocational centers to deliver basic skills instruction are more easily integrating education and work experience than states relying primarily on community-based organizations and volunteers.

Lastly, for basic skills to achieve a higher profile in welfare reform in all states, the survey recommends identifying successful models and showcasing them at national, regional, state, and local technical assistance meetings. It defines “successful” as reaching prescribed benchmarks -- including meeting qualifying criteria to advance along the path to employment, securing placements in jobs, and being backed by accurate data that includes sufficiently large numbers to make the case. (For a copy of survey findings, contact The National Adult Education Professional Development Consortium at 202/624-5250.)

TANF’s five-year time limit on welfare assistance is likely to create a whole new group of potential customers for literacy services. First, it is likely that many of the jobs found by recipients will be in low paying positions that have limited potential for advancement. In order to move ahead and provide for their families, many adults will want and need literacy and basic skills services even after leaving welfare.

Second, recipients with stronger educational backgrounds will likely be the first to acquire jobs and move off the welfare roles. As time goes on, recipients with greater literacy needs will feel increasing pressure to find work. The longer term welfare recipients are generally less educated than other recipients and will likely put additional demands on the adult education and literacy delivery system.

While the need for adult education and literacy services will increase, time limits and restrictions on how such services count toward work rates will mean delivering services differently. Future adult education services for recipients will need to be shorter, more intensive, and more closely tied to work.

This law’s work requirements could lead to a substantial increase in adult education enrollment in 1999 and beyond, because at that time federal law allows all states to count participation in education activities towards the work requirement for more recipients.

The law requires each state to enroll a rising percentage of welfare recipients in work activities for increasing amounts of time or face losing a portion of its federal funding. Beginning in 1997, the law requires one-quarter of welfare recipients in each state to work. The percentage of recipients who must work increases each year through 2002, when 50 percent are required to work.

Between 1997 and 2002, there will be changes in both the amount of time required for work and the definition of work. In terms of time, in 1997 and 1998, a recipient must work at least 20 hours for work to count towards the state’s work requirement. In 1999, this increases to 25 hours per week, and from 2000- 2002, recipients must work 30 hours per week.

In terms of the definition of work, in 1997 and 1998, recipients may satisfy the work requirement by participating in any of the following activities: unsubsidized employment, subsidized private or public sector employment, on-the-job training, community service, and providing child care to an individual participating in community service. Job search and vocational educational training count within certain limits. Beginning in 1999, the hours of work beyond the initial 20 may also be satisfied by the following:

For example, in 1999, 35 percent of the welfare caseload in each state must be working at least 25 hours per week, and time spent in adult education and literacy activities beyond the initial 20 hours of work per week will count as work for the entire caseload. This means that in 1999 many welfare recipients will likely seek out at least five per week of adult education and literacy instruction. In 2000-2002, demand for adult education services may increase further, because a growing percentage of the caseload is required to work 30 hours per week, and 10 of those hours may be education and training, including literacy.

In sum, states have to place an increasing percentage of their caseloads in a work activity, but two modifications allow states to improve the skills of recipients and still count that activity as work. First, they can broadly define “vocational educational training” to include successful models of basic skills education and training and apply the 20 percent cap to their whole caseload so more recipients can enroll in these services while still counting towards the work requirement. Second, after 1998, states can combine education, training, and work for every recipient counted towards the work requirement. The bottom line is clear: after five years of TANF assistance, all recipients will have to support themselves. The clock is already ticking, and the best way the adult education and literacy field can help is to keep this in mind as we plan and administer all our classes and services. We also must plan for the possibility of increased enrollments as the law’s effects are felt by more recipients. The only way we can genuinely assist recipients in preparing for a future without welfare is by providing services that help them develop the skills needed for long-term self-sufficiency in the quickest possible way.

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