National Association of State Liaisons for Workforce Development Winter Meeting

Setting a New Course for State Welfare Programs

January 22, 2007

New TANF Provisions and Implications

TANF provisions in the DRA impose new rigor around work requirements

State flexibility further limited by the interim rules

Opportunity and challenges -- What’s the connection to the workforce system?

DRA: Major Funding Issues

Fixed funding $16.57 billion through 2010 Supplemental grants extended through 2008 $200 million additional child care $ Eliminates bonuses; new marriage $ Changes in child support & child welfare that

decrease federal reimbursement

DRA: Major Work Issues

Retains work participation rates of 50% for all families and 90% for two-parent families

Changes base year for calculating caseload reduction credit to 2005

Includes those in separate state programs in calculation of work participation rates

Implications

Value of caseload credit greatly diminished – work rate is very real challenge.

FY 2004 only nine states met 50%, 18 states were below 25%.

29 states had separate state programs for two-parents and families with significant barriers, representing 12% of the caseload.

Implications, cont’d

New provisions effective October 1, 2006, states had little time to make strategic choices.

Penalties and higher maintenance-of-effort requirement if fail to meet work rate.

Up to 5% of TANF grant and 80% MOEUncertainty about penalty “disposition”

Regulations on work definitions

Narrows work experience and community service –excludes “barrier removal” activities.

Job search and job readiness become “catchall” but are time limited.

Baccalaureate education doesn’t count. ABE and ESL only when part of employment

or vocational educational training. Verification & reporting requirements.

Challenge for States

Meeting the work rate and: Supporting working families, including

advancement and retention and child care Assisting persons with multiple barriers Allowing activities that might not count

toward work participation rate Using TANF $ flexibly and for broader

purposes

Strategies for Meeting Work Rate

Engage people sooner Engage more people Engage individuals for more hours Keep working families attached longer Reduce denominator – soley state-funded Count better

Opportunities

Clarify desired goals and purposes of state welfare programs. Re-energize program.

Redirect spending back to welfare-to-work efforts

Revitalize partnerships with workforce system and others

Increase short-term training opportunities

Elements of Success?

Leadership that focuses on broader goals Strategic partnerships

Using knowledge gained and research conducted over past 10 years

Culture change and messaging Enhancing front-line capacity Measuring performance Blending short-term responses with longer-term

strategies

Immediate Strategies to Meet TANF Requirements

Earnings Supplements Solely State-Funded Programs Sanction Policies Definitions of Work-Related Activities Up-Front Diversions

Earnings Supplements

Small cash payments for employment-related expenses or bonuses for remaining employed

Helps states by retaining employed TANF clients in work participation rate

Example: Arkansas Work Pays

Solely State-Funded Programs

State funds used to support TANF families that do not count towards MOE – “outside of TANF/MOE structure”

Clients can enroll in activities most suited to their needs, not necessarily those that count towards the work participation rate

States can serve clients with more substantial barriers to employment without a reduction in work participation rate

Sanction Policies

States moving from partial to full-family sanctions

States implementing sanction policies within a shorter time period

Clients need to fully understand policies Families often need assistance after being

sanctioned

Definitions of Work-Related Activities

States are redefining work-related activities to match federal definitions

Focus on engaging more clients, increasing number of clients in countable activities, increasing number of hours clients are in countable activities

Example: Washington State

Up-Front Diversions

Up-front assistance to help families avoid welfare and/or address barriers to employment before looking for work

Clients in crises can receive cash assistance and services to address barriers

States can help clients enter TANF program engaged in countable work activities and more ready for work

Examples: Minnesota’s Diversionary Work Program

Pennsylvania’s Work Support Component

Long-Term Strategies to Meet TANF Requirements

Transitional Jobs Programs Short-term, integrated education and training

programs Assessments, case management, and

connections to other systems Redesign of job search/job readiness

activities

Transitional Jobs Programs

Provides TANF clients with paid, temporary work experience in supportive environment

Typically for clients with lower skill levels Paid employment allows clients to qualify for

tax credits Employers receive subsidies to cover wages,

benefits and other costs of hiring TANF client http://www.transitionaljobs.org

Short-Term Integrated Education and Training Programs

Positive benefits of incorporating education and training activities into a work-focused strategy – applied learning tied directly to work

Bridge programs to help clients quickly gain fundamental skills

Programs aligned to needs of local labor market

Employers engaged in design of programs Career pathways and sector strategies

Assessments, Case Management and Connections to Other Systems

Upfront assessments to determine needs Coordinating case management services to

provide a wide range of support Helping clients access other services and

systems to address mental health, substance abuse, and vocational rehab needs

Redesign of Job Search and Job Readiness Activities

Encouraging clients to seek higher quality jobs

Helping clients finding employment in industries with historically higher wages

Stressing importance of strategic job change Linking job search and job readiness to

needs of local labor market

Challenges to engaging workforce system

Most “surplus” dollars are gone. Shift in emphasis from workforce-TANF

collaboration to workforce-economic dev. Duel constituency of workforce Family focus of TANF— “social services”

Both Systems Gain

Burgeoning experience of workforce system (community colleges, voc. training) in creating career paths in high-wage, high-growth jobs.

TANF $$’s can help spur further innovation. TANF recipients part of workforce pipeline to help

meet skills shortage. Common vision of long-term economic well-being

that includes making work pay, work supports, asset development and advancement.