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Date: Friday, Aug. 16, 1996
FOR IMMEDIATE RELEASE
Contact:  Michael Kharfen,  (202) 401-9215

HHS Secretary Donna E. Shalala today approved two welfare demonstration projects for the state of Minnesota: "Work First" and the "Aid to Families with Dependent Children (AFDC) Barrier Removal." These are the second and third waiver applications for Minnesota and the 72nd and 73rd state demonstrations approved under the Clinton Administration.

"As President Clinton prepares to sign historic welfare reform legislation that fulfills his principles of requiring work and promoting parental responsibility, he also continues his commitment to state flexibility," said Secretary Shalala. "These new waivers will build on Minnesota's promising demonstration and lay a strong foundation for its new welfare program."

Work First will operate in Clay and Carver counties and will assign new applicants to one of three program tracks: immediate employment, deferred employment, or a transitional period during which appropriate services will be provided. For those applicants who are victims of domestic abuse, homeless or in treatment for chemical dependency, a personal stabilization period of up to eight weeks will be allowed before participation in an employment plan. The project will also require new applicants to participate in Work First job search and employment activities. The state will provide AFDC benefits in the form of vendor payments for the family's rent and utilities for the family's first six months receiving AFDC.

The demonstration will also provide work incentives, services and supports to move applicants into the work force as soon as they begin to receive AFDC payments. The state will provide post- placement supportive services for up to 180 days after a person leaves AFDC for work. Eligibility for transitional child care and Medicaid will be expanded. Participants who fail to comply with program requirements will be sanctioned.

In the statewide AFDC Barrier Removal demonstration, for minor parents and their dependent children living with an adult parent not receiving AFDC, the state will disregard the adult parents' earned income up to 200 percent of the federal poverty guideline. Earned income of dependent children and minor parents who are at least half-time students will be excluded in determining eligibility and benefits. Funds deposited into an identified separate savings account as a resource for dependent children and minor parents who are applicants or recipients will also be excluded. The state will disregard the equity value of one motor vehicle up to the Food Stamp dollar limit, currently $4,600, and will eliminate several AFDC-UP eligibility restrictions.

"Minnesota's demonstrations promote responsible parenthood by helping keep two-parent families together and providing incentives for minor parents to live in adult-supervised settings," said Mary Jo Bane, assistant secretary for children and families. "These waivers will give Minnesota a strong foundation for reforming its welfare system."

The demonstrations will operate for five years, and will include a rigorous evaluation.

Under the welfare reform bill passed by Congress, states that have waivers approved prior to the law's enactment generally may continue their waivers even when they conflict with the legislation.