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May 26, 1998

The Reality of Welfare Reform:

In Alabama and Across the Nation

by Nicole Youngman

In August of 1996, President Clinton signed into law H.R. 3734, the much-discussed "welfare reform" bill. Also known as the "Personal Responsibility and Work Opportunity Reconciliation Act," the new law did away with the old "Aid to Families with Dependent Children (AFDC)" program and replaced it with another called "Temporary Assistance for Needy Families (TANF)." This new approach rearranged the structure of "welfare as we know it," giving states considerably more control over how they design and implement their programs. States now receive "block grants" from the federal government and are required to "include mandatory work- (public or private, subsidized or unsubsidized), education-, and job-related activities, including job training and job search, for the purpose of (1) providing such families with time-limited assistance in order to end their dependency on government benefits and achieve self-sufficiency; (2) preventing and reducing out-of-wedlock pregnancies, especially teenage ones; and (3) encouraging the formulation and maintenance of two-parent families." The law "limits eligible families generally to no more than 60 months (five years), consecutive or non-consecutive, of TANF, with exceptions for hardship situations, minor children, or family members that have been battered or subject to extreme cruelty, including mental abuse." States are given specific goals and guidelines for reducing welfare rolls and illegitimacy rates.

States are expected to perform "an initial assessment of a recipient's skills, prior work experience, and order to gauge the level of support needed for the recipient to achieve self-sufficiency." States are then required to develop an individual responsibility plan (IRP) that "describe[s] the services that the State will provide to enable the individual to obtain and keep such employment." In return, recipients may be required to satisfy such obligations as immunizing their children and keeping them in school, attending money management or substance abuse treatment programs, or working with the State to establish paternity of their children and obtain child support. States that do not comply with federal regulations can have their grants reduced, and welfare recipients who do not participate in state programs can have their assistance payments reduced or terminated.

The Harbinger did some research and talked to local DHR administrators Gwendolyn Smith, who is the Program Administrator for TANF/JOBS, and Brenda Johnson, who is the Program Supervisor for JOBS, about the current welfare laws in the state. In Alabama.

Family Assistance Standards
State of Alabama

Family SizePayment
1 $111
2 $137
3 $164
4 $194
5 $225
6 $252
7 $287
8 $315
9 $344
10 $372
11 $400
12 $428
13 $457
14 $485
15 $513
SOURCE: Department of Human Resources
(DHR-FAC-595) March 1997.

According to documentation provided by the Mobile Count Department of Human Resources TANF Office, "Individuals and assistance units applying for or receiving family assistance [FA] benefits must...cooperate with the activities to accomplish self-sufficiency. These activities include child support cooperation, job search and JOBS [job training] participation. Failure to cooperate in activities to accomplish self-sufficiency without good cause or deferral from participation results in denial or loss of benefits." Alabamians who receive welfare must turn over all child support benefits to the state; if, after three months, the child support payments have been made regularly by the father and the checks are bigger than those supplied by FA, the recipient is given the child support check rather than the FA check. Check amounts are based on the number of people in the household, and have not changed from the amounts given under the old AFDC rules. However, non-parents who receive checks on behalf of children they are caring for are not included when figuring these amounts. Recipients must not have a net monthly income which exceeds the payment standard (see chart--some allowances are made for work and child care expenses), and may not have assets in excess of $2,000, or $3,000 if the household contains a member over the age of 60. This includes money in the bank, trust funds, valuables in safe deposit boxes, life insurance, real property, and some personal belongings. The value of one car per licensed driver and the house in which the family lives are excluded.

The family member receiving FA is required to "notify the Department within 10 days of any change in circumstances which may effect eligibility. At least once every six months, the relative must give the Department information needed for a complete redetermination of eligibility...if a relative is requested to do so and does not, the family may lose FA unless the relative had good cause." Child support services are available to recipients without separate application, and application for Medicaid may be made at the same time as the application for FA. Day care services are also available through the Gulf Regional Child Care Management Agency, and may continue for up to 12 months if a recipient's benefits are terminated due to increased income or hours of work: "If our participants need child care, they get it," Smith and Johnson state. Recipients are also entitled to continue receiving benefits for three months after they have found a job, in order to ease the transition from FA to employment.

Recipients under the age of 20 who have not completed high school are required to work toward graduation, and clients who are within a year of finishing a vocational college degree are allowed to continue; this educational activity counts as their JOBS participation. However, students in four-year colleges are not given the same benefits. "We are pretty much work-first," Johnson states. "It's no longer sequential. Education is done in conjunction with work activities; people are more motivated to continue their education if they're working."

Unlike the old AFDC system, in which about 60% of welfare recipients were exempt from participation in JOBS because they had a child under the age of three or were combating an illness, under TANF recipients are only allowed temporary deferrals from JOBS participation if they have a child under the age of one year, have a documented medical problem, or need to care for someone in their home. However, most of these deferrals do not stop the clock on the 60-month lifetime limit for receiving benefits, and Smith and Johnson state that they often encourage mothers of infants to go ahead and participate in the JOBS program.

These tough new work, eligibility, and reporting requirements in Alabama and around the country have been lauded by those who insist that it will cut down on welfare fraud and help move people "off the dole" and into a job that allows them to become self-sufficient instead of living off taxpayers' money. However, many advocacy groups for low-income families are concerned that these changes have don more harm than good.

When the new law was first signed, researchers with the Center on Budget and Policy Priorities expressed concern that the federal funding levels for welfare programs would be inadequate, especially in the case of an economic downturn. "States will receive a fixed level of resources for income support and work programs based on what they spent on these programs in 1994, without regard to subsequent changes in the level of need in a state. The bill provides some additional contingency funds' if need increases in the states, but the contingency funds are likely to prove in adequate if a recession occurs." Johnson expressed a similar concern: "I think the funding is adequate now, but if the economy takes a dive, the people that we work with...are going to be the first to lose their jobs."

According to an editorial by the Montgomery Advertiser last year, two percent of Alabamians receive direct cash assistance, and 98 percent of those families are headed by single women; the average size of a family receiving FA is 2.5 persons, and according to Smith, the average stay on FA is 2.5 years. The Advertiser also reported last fall that Alabama was the only state which decided to cut off some legal immigrants who had been receiving assistance.

According to DHR statistics, welfare rolls in Alabama are dropping sharply, down 33 percent from September 1996 to September 1997. In Mobile County, the caseload is down 39 percent. Alabama pays the second lowest public aid in the U.S.; only Mississippi's benefits are lower, and the Advertiser suggests that some families may simply decide not to apply. However, Alabama Arise, a coalition of 108 religious and community groups based in Montgomery, suggests that something else may be going on: fewer families are being awarded benefits in the first place, though there has been no decline in the number of applications. "Nobody knows how many applicants didn't follow through in the two job interviews required, and how many are getting jobs," the agency states. "DHR doesn't follow up, so it's open to speculation." Smith states that the computer system at the state level is not sophisticated enough to handle that kind of tracking, but DHR is working to upgrade the system.

It also remains to be seen what happens to families when former TANF recipients have been working at an entry-level, low-paying job for a couple of years and are no longer receiving any cash, child care, or health care benefits. And while businesses can receive a tax break of $8,500 over a two-year period if they hire welfare recipients, and some have taken advantage of this to give area recipients jobs, Smith and Johnson state that there is still a need for more private-sector employment. More full-time jobs with regular benefits are especially needed.

A study conducted by the Center on Hunger and Poverty at Tufts University in Medford, Mass., the results of which were released earlier this year, raises similar questions. While the study found that most states are spending more on child care than under the old system, and have found ways to allow welfare recipients to keep more of what they earn, it also found that 35 states, including Alabama, "have adopted policies that are more harsh than under the old welfare system." In fact, Alabama's policies ranked 45th in the country, tied with Mississippi, on a scale that measured how well the state is actually helping families in poverty compared to its former welfare policies.

An article published this March in the Washington Post states that "closer scrutiny of state and federal records shows that tens of thousands of families are being forced off welfare as punishment for not complying with tough new rules. Federal statistics show that in one three-month period last year, 38% of recipients who left welfare did so because of state sanctions, ordered for infractions from missing appointments with caseworkers to refusing to search for work." Smith and Johnson state that, in Alabama, the FA check is reduced 25 percent per month for the first three months of non-compliance; after a fourth month, recipients are cut off for a month and then allowed to re-apply. If recipients are non-compliant again, however, they can be cut off for six months. Smith and Johnson insist these sanctions are not imposed if the recipient can give her caseworker a good cause for her lack of participation: "In most cases clients make an informed decision not to cooperate."

And at least one study conducted thus far suggests that, while the number of people on welfare rolls across the country may be decreasing sharply, and some of these people have in fact moved into jobs, others are becoming homeless. A team of researchers, led by Charles Kurzman at the University of North Carolina-Chapel Hill and

Shawn Lucas of the Metro Atlanta Task Force for the Homeless, interviewed homeless women who came to shelters and called a hotline in metro Atlanta during the summer of 1997. A majority of respondents in both samples stated that they had had their welfare benefits stopped or reduced during the past year; some were living on the street, others were trying to stay with friends or relatives. A variety of problems stemming from the new welfare rules had contributed to their situation; some had had their income increase and had lost their eligibility, some had not properly completed a job-training program, and several had experienced "paperwork problems" such as not responding to notices or failing to provide certain documentation. These problems were often exacerbated by a lack of reliable transportation and/or difficulty in maintaining a permanent address. One homeless woman even stated that "she was sanctioned for failing to appear at a meeting at a time when she was in the hospital giving birth." While it is difficult to establish a direct cause-and- effect relationship between welfare reform and homelessness, this study does suggest that such concerns are legitimate.

Smith and Johnson state that homelessness is not the same kind of problem here in Mobile; transportation, however, can be a huge problem. "Agencies here have been pretty responsive to the needs of the homeless," Smith states. "Because most of our clients have children, they have someplace to stay," and are able to rely on extended networks of family and friends. But one of the biggest problems facing TANF recipients in our area is the lack of a reliable car, and the fact that the buses do not run after 6 PM or on weekends, and are only available within the metro Mobile and Prichard areas. "We do have some folks with no [transportation] resources and no access to resources, " Johnson says. DHR helps out by buying clients bus tickets and reimbursing them up to $50/month for transportation expenses. Friends and family frequently help drive clients to their jobs and appointments, but they are not always available when needed.

It is clear that simply looking at the declining welfare caseloads in Alabama and around the country does not tell the whole story; while some of the people who have left the TANF program have found and kept jobs, it is likely that others have not. Government agencies are not tracking those who leave the rolls, and tracking people who become homeless is exceedingly difficult. Welfare recipients who are making a good-faith effort to find work still face a variety of daunting problems such as inadequate child care, unreliable transportation, and lack of education, job experience, and/or literacy and other "life skills."

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