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Administration for Children and Families US Department of Health and Human Services

SUMMARY

FINAL RULE

TEMPORARY ASSISTANCE FOR NEEDY FAMILIES (TANF) PROGRAM

 

Background

The Personal Responsibility and Work Opportunity Reconciliation Act of 1996 (PRWORA) (Pub. L. 104-193), as amended, is the welfare reform law that established the Temporary Assistance for Needy Families (TANF) program. TANF is a block grant program designed to make dramatic reforms to the nation's welfare system by moving recipients into work and turning welfare into a program of temporary assistance. TANF replaced the national welfare program known as Aid to Families with Dependent Children (AFDC) and the related programs known as the Job Opportunities and Basic Skills Training (JOBS) program and the Emergency Assistance (EA) program.

Principles Governing the Final Rule

The Administration for Children and Families (ACF) has published a final rule that governs key provisions of the TANF program. It incorporates the core TANF accountability provisions, including work requirements, time limits, State penalties, and data collection and reporting requirements. It does not address other key provisions, such as the High Performance Bonus, the Bonus to Reward Decreases in Illegitimacy Ratios, the Child Poverty Rates, and the Tribal TANF program. We expect to publish rules for most of these other provisions in the coming months.

The TANF final regulations provide States a clear and balanced set of rules for meeting the law's performance goals. They reflect PRWORA's strong focus on moving recipients to work and self-sufficiency, and on ensuring that welfare is a short-term, transitional experience, not a way of life. The rules encourage and support State flexibility, innovation, and creativity to develop programs that can reach all families and provide supports to working families. They do not tell States how to design their TANF programs or spend their funds. At the same time, the rules hold States accountable for moving families toward self-sufficiency.

Because of the changed Federal role regarding welfare reform, the rules regulate under two basic circumstances: (1) where Congress has explicitly directed the Secretary to regulate; and (2) where Congress has charged HHS with taking action (e.g., imposing penalties). In the latter case, we have set out, in rules, the criteria and procedures we will use in carrying out our express authority to hold States accountable by assessing penalties.

In drafting these rules, we considered nearly 300 comments that we received following publication of a Notice of Proposed Rulemaking on November 20, 1997. As a result of these comments and the continuing progress of States in implementing their welfare reform programs, we made a number of changes in the final rules.

The final rules will take effect on October 1, 1999.

Key Provisions

The following information highlights many important aspects of the rules. The summary does not address certain areas (for example, program purposes, individual responsibilities, and individual development accounts), where the rules merely paraphrase statutory provisions to add clarity and completeness.

DEFINITION OF ASSISTANCE

The revised definition of assistance will make it easier for States to use welfare block grant dollars to help people who have left welfare (defined as payments to cover ongoing basic needs) stay off the rolls -- or to help families so they do not have to go on welfare in the first place.

SEPARATE STATE PROGRAMS

CHILD-ONLY CASES

WORK

PARTICIPATION REQUIREMENTS AND WORK ACTIVITIES

CASELOAD REDUCTION CREDIT

Step 1 – We compare 1995 AFDC caseload data to State-reported TANF and separate State program caseload data.

Step 2 – States must submit a Caseload Reduction Report that includes: a complete listing and implementation dates of State and Federal eligibility changes; a numerical estimate of the impact on the caseload of each change; an estimate of the State’s caseload reduction credit; a description of the methodology for the estimate; and a certification that the public had an opportunity to comment on the Report. States must also submit information on the number and distribution (by reason) of application denials and case closures in 1995 and the prior year.

Step 3 – We compare and analyze each State's methodology, estimates, and data to determine whether they are reasonable. We may request additional information to adjust the estimates. In addition, we will conduct periodic on-site visits and examine case records to validate the information we have received.

TIME LIMITS

FAMILY VIOLENCE OPTION (FVO)

DOMESTIC VIOLENCE WAIVERS AS REASONABLE CAUSE

DOMESTIC VIOLENCE WAIVERS AND OTHER PENALTY RELIEF

WELFARE REFORM WAIVERS

 

THE EFFECT OF WAIVERS ON WORK REQUIREMENTS

THE EFFECT OF WAIVERS ON THE TIME LIMIT

TANF EXPENDITURES

EXPENDITURES

ADMINISTRATIVE COSTS

MAINTENANCE-OF-EFFORT (MOE)

(1) In every fiscal year, each State must spend at least 80 percent of what it spent in FY 1994 if it does not meet the minimum work participation rates; or it must spend at least 75 percent of what it spent in FY 1994 if it meets the minimum work participation rates. (This is known as the basic MOE requirement.) If it spends less than the required amount, it is subject to a penalty based on the size of the shortfall.

(2) If a State fails to meet its basic MOE requirement during a year in which it receives a Welfare-to-Work formula grant, its TANF grant will be reduced by the amount of the Welfare-to-Work formula grant it received.

(3) Contingency Funds available to a State may be retained only to match State expenditures in the State's TANF program that exceed its State expenditures in FY 1994. An annual reconciliation must be completed to determine how much of the contingency funds received in a fiscal year may be retained and how much, if any, must be remitted. If the State fails to remit the required amount, it faces a reduction in its TANF grant equal to the amount of funds not remitted.

USE OF FEDERAL FUNDS

RECIPIENT AND WORKPLACE PROTECTIONS

DATA COLLECTION AND REPORTING

TANF DATA REPORT

SSP-MOE DATA REPORT

TANF FINANCIAL REPORT

ANNUAL REPORT

ADDITIONAL REQUIREMENTS

PENALTIES

    (1)Use or intentional misuse of the grant;

    (2) Failure to submit required reports that are complete, accurate, and timely;

    (3) Failure to meet minimum work participation rates;

    (4) Failure to meet the appropriate level of historic effort in the operation of the TANF program; and

    (5) Failure to comply with the five-year limit on Federal funding of assistance.

REDUCTION OF WORK PENALTIES BASED ON DEGREE OF NONCOMPLIANCE

REASONABLE CAUSE

CORRECTIVE COMPLIANCE

USING FLEXIBILITY TO EVADE ACCOUNTABILITY

DEFINITIONS