March 26, 2009

Taking on TANF

Yesterday was the annual budget hearing for the Department of Human Services (DHS), the agency that administers the Temporary Assistance to Needy Families (TANF) program, which provides cash assistance, job training, and other critical services for vulnerable families facing a period of unemployment. The hearing is one of the few opportunities each year for the public to engage in discourse about how the city administers TANF.

So the advocates were out in force -- SOME advocate (and friend of Bread) Joni Podschun delivered testimony along with DC Fiscal Policy Institute, DC Women's Agenda, and Legal Aid. I'm told that things got lively -- and for those of us who hope to see the TANF program revisited and improved, the transcript is indeed encouraging.

Last week, Joni wrote a post on this very blog about TANF. DC receives $88 million worth of TANF funding from the federal government. But it's in the form of a block grant, which means that the city has discretion as to how the funding will be used. The core of the program is cash assistance ($427/month for a family of three) and employment services, but the $88 million is also directed towards anything from teen pregnancy prevention to college tuition, from foster care to ESL classes. Joni explained in her post that DC's TANF program is actually "stable and robust" when compared with many other states; and yet, she concluded, "as the economic downturn threatens to push more D.C. residents into poverty, the TANF program needs to be revisited and strengthened."

With the budget process under way, now is the time that the City can act to improve the system.

All of the advocates who testified yesterday called for the same action: increase the cash assistance by $19 a month, as a cost of living adjustment (known as a COLA). (This action is also recommended by the Fair Budget Coalition, which Bread for the City supports, and which has its recommendations in PDF form here.)

Now one might think that the level of cash assistance from TANF would be set to rise regularly in order to track with inflation -- but this practice ended in 1991. Since then, the benefit has lost 34% of its value.

The COLA that the advocates called for would represent a 4.4% increase. Though that's still a long ways from what it was decades ago, to TANF families this $19 represents a new pair of shoes for their kids, bus passes, school supplies, etc. It would cost the city a total of $2.7 million. Unfortunately, the Mayor's proposed budget does not include such a COLA.

Toward the end of the hearing, there was an exchange between Clarence Carter, the Director of DHS, and Councilmember Tommy Wells that is worth reading to get insight into why the TANF cash benefit hasn't increased in the face of a rising cost of living.


Wells: We proposed last year to hold off on the [TANF cash assistance] increase. For two years straight now we have had the same benefit amount. Why have you not proposed a cost of living increase?

Carter: Instead of an approach which provides a meager amount of dollars for a family, we believe that to work more intensively to grow their capacity beyond their need is a better use of the dollars. ...This is opposed to taking a relatively small amount of money to increase their benefits.

Wells: …I realize that we certainly don’t want to pull back from growing people’s earning capacity. How long should we leave it at this amount? What is the decision making process or the principle for ever increasing the TANF benefit rate?

Carter: The question should be how long will we focus on insuring the family doesn’t have to exist at that capacity. …

Wells: As you know we are approaching the 10% unemployment rate. As you and I both know the number is likely larger than that. The job opportunities seem to be diminishing. It is not a job rich time to say that we’re not going to increase the TANF benefits. Everyone knows that in Maryland they have a larger benefit and the cost of living is smaller there. Here our TANF benefits are lower and we have a higher cost of living. At some point we are going to need to increase it. Would you ever—10, 20, 30 years from now—increase the benefits?

Carter: I would hope that by then we would have developed a robust mechanism that would aggressively move them beyond their current capacity so the focus would not be on the benefit amount.

[UPDATE: Joni points us here, where the conversation can be seen on video, starting at 2hrs:51minutes. Thx Joni!]

Now, Carter's initial point is well-taken: TANF is supposed to function as a channel that will bring people into the workforce, and ultimately lead to self-sufficiency. Few would disagree with him that these are in fact important.

But people need to be healthy and safe today in order to get a job tomorrow. And to maintain that health and stability, people need a sufficient income. And as Councilmember Wells notes, we're at a moment in which job opportunities aren't really there to be had even for those who have gone through job training and are model candidates for employment. If there was ever a time to increase the level of cash assistance to families who need to survive in the face of unemployment, it's now.

And in any case, it seems like Carter is presenting the Council with a false choice. It should be possible to increase the cash benefit of assistance and simultaneously work to improve the programs that will expand people's capacity for work. SOME will soon release a report, along with DCFPI, that will have more detailed recommendations on how DHS could improve the efficiency of workforce programs -- but in the meantime, our city leaders need to take a hard look at how the numbers add up between what it costs to live in DC and what assistance is available to families who don't yet have a source of income.

During the hearing, Councilmember Wells (as well as Councilmember Michael Brown) pointedly considered the negative impact that an insufficient income has on a family, and even a community. By keeping the TANF benefit flat, the city would save $2.7 million, and thousands of DC families will face that much more instability and stress, which affects their children's education, their physical and mental health, and their future earning potential. Penny-wise and pound foolish, indeed.

So please express your sentiment to Councilmember Wells, who showed real leadership in asking these questions. You can send him your thanks by email, or call (202) 724-8072.

1 comment:

Joni said...

You can watch the hearing exchange here: http://oct.dc.gov/services/on_demand_video/on_demand_march_2009_week_4.shtm. It's Part 3 of the Committee on Human Services hearing. The conversation starts at 2 hours and 51 minutes. Interesting stuff!