Talking Points for WV TANF Cuts Crisis
The main reason for the TANF budget crisis is that Temporary Assistance for Needy Families (TANF) money has been diverted to other purposes. TANF funding is adequate to cover the costs of the core programs of cash assistance and supports for those seeking employment. The problem is that TANF money is being spent on other programs, such as social services, and for increased administrative and systems costs. While many of these services are worthy of funding, it’s not responsible public policy to make the poorest and most vulnerable families pay for these administrative decisions.
Children, who make up two-thirds of TANF recipients, are hurt the most by cuts which plunge their families even deeper into poverty. Low income people, by definition, spend more of their money on necessities than those with higher incomes. For many middle income families, even a 10% cut in income would be harmful. The effects of the 25% cut in cash assistance —from $453 to $340 for a family of three—has been devastating.
Cuts in cash assistance take away money from local economies. Prior to the cuts, cash assistance for a family of three at the current annual rate was $5,436, or about 35% of the 2004 federal poverty level (FPL) of $15,670. With the cuts, that family’s annual income is reduced to $4,080, 26% of the FPL.
Support services such as transportation assistance have proven very effective in helping families escape welfare for work. The 50% reduction in transportation assistance is particularly harmful with gasoline prices over $2.00 per gallon. The elimination of programs which help adults in these families acquire donated cars places a further roadblock on the way to self-sufficiency.
Elimination of intensive case management programs for families with multiple barriers to employment prevents families from becoming self-sufficient. The elimination of intensive case management programs, such as Community Access, has put a further burden on already overworked DHHR employees. With the large case loads, it is extremely hard for DHHR employees to devote the significant amount of time needed on these individual families.
Working families are hurt by cuts to TANF programs. Many low-income working families receive TANF benefits such as child care and transportation assistance. These families are the first families to be affected due to changes in qualifications
On May 13, 2004, the WV Department of Health and Human Resources (DHHR) announced drastic cuts to state programs funded with federal TANF money. The reasons given by the Department for these cuts were a reduction of available funds from the federal government and an increase in the number of people eligible for these programs. These reasons do not hold true.
The amount of federal TANF funds received by West Virginia has not decreased and there has only been a slight increase in the TANF caseload. According to an analysis by the Center on Budget and Policy Priorities (CBPP), Federal funding is equal to federal AFDC-related spending in 1994 while the state’s MOE requirement is equal to either 75 or 80 percent of what it spent in AFDC-related programs in 1994 (depending on whether the state meets its work participation requirements).
Between 1994 and 2003, West Virginia saw its cash assistance caseload decline by 61 percent. This resulted in a significant decline in cash assistance costs for the state. In 1994, West Virginia spent $125.9 million on cash assistance (this includes federal and state spending on AFDC benefits). In 2003, West Virginia spent $68.4 million on cash assistance, a decline of $57.4 million or 46 percent.
Less than half of the funds freed up by reduced cash assistance costs were spent on child care, job training, and transportation programs in 2003. A majority of TANF funds in 2003 were spent on areas other than cash assistance and about one-third were spent in areas other than cash assistance, transportation, and work programs
Analysis from Center on Budget and Policy Priorities
- 41% of TANF and MOE funds were spent on cash assistance
- 68% of TANF and MOE funds were spent on “Core” TANF Program Areas: cash assistance, work programs, and transportation assistance,
- 21% of federal TANF funds are spent on administration only 5 other states were spending 15% or more.
- 16% of TANF and MOE funds were used for other purposes such as social services and two parent family programs
What we want
- more money going to directly benefit families
- programs that help families with multiple barriers address their needs
- education, training, and work programs that result in self-sufficiency wages
- more open and transparent accounting practices (not just line items but specifics)
- input from families that are affected before changes are made (advisory councils)