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The Temporary Assistance for Needy Families
Block Grant: An Introduction
Gene Falk
Specialist in Social Policy
December 28, 2011
Congressional Research Service
7-5700
www.crs.gov
R40946
CRS Report for Congress
Pr
epared for Members and Committees of Congress
c11173008

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The Temporary Assistance for Needy Families Block Grant: An Introduction

Summary
The Temporary Assistance for Needy Families (TANF) block grant provides grants to states,
Indian tribes, and territories for a wide range of benefits, services, and activities that address
economic and social disadvantage for families with children. TANF is best known for funding
state cash welfare programs for needy families with children, and it was created in the 1996
welfare reform law. However, TANF is not synonymous with cash welfare. In FY2009, only 28%
of federal and state TANF dollars were for cash welfare. TANF also funds child care; programs
that address child abuse and neglect; various early childhood initiatives, including pre-
kindergarten programs; earnings supplements for workers in low-income families; emergency and
short-term aid; pregnancy prevention programs; responsible fatherhood programs; and initiatives
to encourage healthy marriages.
The bulk of federal TANF funding is in a fixed block grant, which has been set at $16.5 billion
since FY1997. The basic block grant is not adjusted for inflation, or for changes in the
circumstances of a state such as its cash welfare caseload, population, or number of children in
poverty. States are also required to spend a specified minimum of $10.4 billion in state funds on
TANF-related activities and populations. This amount also has not changed since FY1997.
TANF cash welfare programs today reflect a long history (going back to the early 1900s) and
much controversy. States set their own cash welfare benefit levels. In 2009, cash benefits in all
states represented a fraction of poverty-level income. In New York, the state with the highest
benefit among the 48 contiguous states, the maximum TANF cash benefit for a family of three
was $721, which translates to 47% of poverty-level income. Families with adult recipients (and
certain nonrecipient parents) come under work participation rules. Federally funded aid is also
time-limited for such families.
The cash welfare caseload has declined dramatically from its pre-welfare-reform high of 5.1
million families in 1994 to 1.7 million families in July 2008. The cash welfare caseload increased
during the recession, standing at 1.9 million families in December 2010. The cash welfare
caseload has traditionally consisted of families headed by a nonworking parent, usually a single
mother. However, in FY2008, less than half of the TANF cash caseload fit this description. The
TANF cash caseload is very diverse, with more than half the caseload having different
characteristics than the historical traditional cash welfare family.
TANF is not a program per se, but a flexible funding stream used to provide a wide range of
benefits and services that address the effects of, and the root causes of, disadvantage among
families with children. TANF is currently funded through February 29, 2012. Decisions on
extending TANF funding in the 112th Congress will be made in the context of both the lingering
effects of the 2007-2009 recession and longer trends that were evident even before the recession
that showed an increasing percentage of children living in poverty and born into circumstances
associated with economic disadvantage.

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The Temporary Assistance for Needy Families Block Grant: An Introduction

Contents
Introduction...................................................................................................................................... 1
TANF Funds .................................................................................................................................... 1
Basic Block Grants .................................................................................................................... 1
The State Maintenance of Effort Requirement .......................................................................... 2
Healthy Marriage and Responsible Fatherhood Grants............................................................. 2
Uses of State TANF Funds............................................................................................................... 2
TANF Cash Welfare Programs ........................................................................................................ 3
Brief History of Cash Welfare ................................................................................................... 3
Benefit Amounts........................................................................................................................ 5
State Flexibility Within Federal Requirements.......................................................................... 6
The Welfare Caseload................................................................................................................ 6
“Nonwelfare” Activities Under TANF............................................................................................. 9
Conclusion ..................................................................................................................................... 11

Figures
Figure 1. Uses of Federal TANF and State MOE Funds by Category, FY2009 .............................. 3
Figure 2. Monthly Number of Families Receiving Cash Welfare: 1959-2010 ................................ 7
Figure 3. Cash Welfare Families by Family Category: FY1988, FY1994, and FY2008................. 8
Figure 4. Composition of the TANF Cash Welfare Caseload by
Family Category in FY2008 ......................................................................................................... 9

Tables
Table 1. TANF Nonwelfare Spending by Category for FY2009 ................................................... 10
Table 2. Selected Economic and Social Indicators for Families with Children, Selected
Years 1995 to 2010 ..................................................................................................................... 12
Table A-1. Federal TANF State Family Assistance Grants, Annual Grant Amounts..................... 13
Table A-2. Monthly TANF Cash Welfare Maximum Benefit Amount for Family Sizes of
Two and Three, July 2009........................................................................................................... 15

Appendixes
Appendix. Selected State Tables.................................................................................................... 13

Contacts
Author Contact Information........................................................................................................... 16
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The Temporary Assistance for Needy Families Block Grant: An Introduction

Introduction
The Temporary Assistance for Needy Families (TANF) block grant provides grants to states,
Indian tribes, and territories for a wide range of benefits, services, and activities that address
economic disadvantage. TANF is best known for funding state cash welfare programs for low-
income families with children. It was created in the 1996 welfare reform law (The Personal
Responsibility and Work Opportunity Reconciliation Act of 1996, P.L. 104-193), replacing the
Aid to Families with Dependent Children (AFDC) cash welfare program and several related
programs. However, in FY2009, cash welfare represented only 28% of TANF funds. TANF funds
a wide range of activities that seek to both ameliorate the effects of and address the root causes of
child poverty. In addition to state block grants, TANF includes competitive grants to fund healthy
marriage and responsible fatherhood initiatives.
This report provides a nontechnical introduction to the TANF block grant. It briefly describes
• TANF financing;
• how TANF funds may be used and are being used;
• the TANF cash welfare programs; and
• other TANF benefits, services, and activities.
For a more technical discussion of federal financing and program rules in TANF, see CRS Report
RL32748, The Temporary Assistance for Needy Families (TANF) Block Grant: A Primer on
TANF Financing and Federal Requirements, by Gene Falk. For current data and statistics on
activities funded by TANF, see CRS Report RL32760, The Temporary Assistance for Needy
Families (TANF) Block Grant: Responses to Frequently Asked Questions, by Gene Falk.
TANF Funds
Though TANF is called a block grant, its financing is complicated and involves both federal and
state monies. Most TANF funding is set at a fixed amount that does not change with state
circumstances. In addition to state grants, there are also competitive grants to community-based
organizations for healthy marriage and responsible fatherhood initiatives.
TANF is not funded through annual appropriations. P.L. 112-78 funds TANF through February
29, 2012.
Basic Block Grants
The bulk of federal TANF funding is in a basic block grant totaling $16.5 billion for the 50 states
and the District of Columbia. TANF funds also go to Puerto Rico, Guam, and the Virgin Islands.
Indian tribes also may operate their own TANF programs, with funding coming from a state’s
block grant amount. For basic block grants by state, see Table A-1 in the Appendix of this report.
The amount each state is entitled to is based on its historical expenditures in the early to mid-
1990s in TANF’s predecessor programs (AFDC and related programs). This amount has been
frozen since TANF’s creation in the 1996 welfare law. It has not been adjusted for inflation or
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changes in a state’s circumstances such as its cash welfare caseload, population, or number of
poor children.
The State Maintenance of Effort Requirement
States are required to spend at least a minimum amount each year on TANF-related populations
and activities. This is known as the “maintenance of effort” (MOE) requirement. Like the basic
federal TANF block grant, which is based on historical federal funding in TANF’s predecessor
programs, the amount each state is required to spend from its own funds is based on historical
expenditures from its own funds in AFDC and related programs. In total, a minimum of $10.4
billion must be spent collectively by the states from their own funds under the MOE requirement.
Healthy Marriage and Responsible Fatherhood Grants
While most TANF funding is for state grants, TANF law includes competitive grants that have
been made to community-based organizations (including faith-based organizations) for healthy
marriage and responsible fatherhood initiatives. Funding for these grants is $150 million, split
evenly ($75 million each) for healthy marriage and responsible fatherhood initiatives. These
initiatives often include education and training sessions for parents or prospective parents in
relationship skills and conflict resolution. Responsible fatherhood programs can also include
employment services and education for noncustodial parents. Both healthy marriage and
responsible fatherhood grants can also fund media campaigns on their respective topics.
Uses of State TANF Funds
States may use TANF funds in any manner “reasonably calculated” to achieve the four goals set
forth in TANF statute. These four goals are
1. provide assistance to needy families so that children may be cared for in their
own homes or in the homes of relatives;
2. end the dependence of needy parents on government benefits by promoting job
preparation, work, and marriage;
3. prevent and reduce the incidence of out-of-wedlock pregnancies and establish
annual numerical goals for preventing and reducing the incidence of these
pregnancies; and
4. encourage the formation and maintenance of two-parent families.
States may also use TANF funds to finance any activity that was included in the pre-1996
predecessor programs. This gives states broad leeway in spending TANF funds. In general, state
MOE funds can be used for these same activities (there are some technical differences in the use
of federal and state funds).
States have used this flexibility to create very diverse programs in terms of the benefits, services,
and activities they fund. Figure 1 shows the uses of federal TANF and state MOE funds in
FY2009. Of the total $33.5 billion, only $9.3 billion (28%) was used for basic assistance, which
most closely corresponds to cash welfare. The three categories most closely associated with state
cash welfare programs—basic assistance, administration, and work expenditures—comprised less
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The Temporary Assistance for Needy Families Block Grant: An Introduction

than half of all TANF and state MOE funds. The $19.4 billion in federal TANF and MOE funds
spent in the other expenditure categories—child care, other work supports, and other
expenditures—are discussed later in this report.

Figure 1. Uses of Federal TANF and State MOE Funds by Category, FY2009
(in billions of dollars, total of $33.5 billion)
Basic Assistance,
$9.3
Other, $10.9
Administration,
$2.5
Other Work
Supports, $2.6
Work Programs,
$2.4
Child Care, $5.9

Source: Prepared by the Congressional Research Service (CRS) with data from the U.S. Department of Health
and Human Services (HHS).
Note: Detail does not add to total because of rounding.
TANF Cash Welfare Programs
To many, TANF is synonymous with cash welfare for needy families. As discussed above, this is
not true: TANF is far broader than cash welfare. However, the policy concerns around cash
welfare are what led to the creation of TANF. This section provides a brief history of the
development of cash welfare, a discussion of cash benefit amounts, the requirements on cash
welfare recipients, and an overview of the number and type of families on the cash welfare
caseload.
Brief History of Cash Welfare
The modern form of cash welfare for needy families with children dates back to the Progressive
Era of the early 1900s and state- or locally funded mother’s pensions for “fatherless” families.
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The Temporary Assistance for Needy Families Block Grant: An Introduction

The Social Security Act of 1935 (P.L. 74-271) provided federal funding for these types of
programs by creating the Aid to Dependent Children (ADC) program. In the early years, benefits
were paid only on behalf of the children (not the caretaker, usually the mother). Families
receiving benefits were usually headed by a widow or had a disabled father.
However, over time, the nature of both the program and the families it aided changed. Social
Security survivors benefits were created in the Social Security Amendments of 1939, and those
receiving ADC increasingly were families where the father was alive but absent. The caseload
also increasingly became nonwhite. Amendments to the program made in 1950 authorized
benefits for caretakers. In 1956, the goals of creating “self sufficiency” and strengthening family
life were added to ADC, along with funding for services that would seek to achieve these goals.
In 1962, the program was renamed Aid to Families with Dependent Children (AFDC).
Policymakers became concerned that cash welfare was a contributing cause of economic
disadvantage. Providing cash to a nonworking parent was seen as a work disincentive, during a
time when an increasing number of women, and mothers, were going to work. Economic studies
generally confirmed that providing welfare was a disincentive to work.1
Further, there was concern that restricting benefits to only single-parent families (usually headed
by the mother) contributed to the trend of an increasing number of children living in single-parent
families. The social science research on the impact of welfare, as embodied in AFDC, on family
structure is inconclusive.2 Cash welfare benefits for families headed by two able-bodied parents
became available in 1961 at state option. It was not until the Family Support Act of 1988 (P.L.
100-485) that states were mandated to provide benefits for such families, and even then it was on
more restrictive terms than those for single-parent families. Two-parent families never became a
large portion of the cash welfare caseload.
The 1980s also saw increasing attention to the notion of “welfare dependency.” Research showed
that many single mothers received cash welfare for only a short period of time, but others were

1 Robert Moffitt, “Incentive Effects of the U.S. Welfare System: A Review,” Journal of Economic Literature, vol. 30,
no. 1 (March 1992), pp. 1-61.
2 In his review of the effects of the U.S. welfare system, published in 1992 and cited above, Moffitt concluded that the
welfare system affected family structure “weakly.” The studies he reviewed were econometric analyses that used
variation in welfare benefits to seek to explain the family status of mothers. The experimental evidence about this effect
is much more ambiguous. A major social experiment that studied the effects of replacing AFDC with a negative
income tax (NIT), which was available to all families regardless of structure, showed that the NIT actually increased
family dissolution over what occurred under AFDC. See Final Report of the Seattle-Denver Income Maintenance
Experiment: Volume 1 Design and Results (SRI International, 1983).The findings of that experiment were subsequently
disputed. See Alicia H. Munnell, ed., “The Income Maintenance Experiments and the Issue of Marital Stability and
Family Composition,” in Lessons from the Income Maintenance Experiments: Proceedings of a Conference Held in
September 1986 (Federal Reserve Bank of Boston and the Brookings Institution), pp. 60-105. Additionally, a study of
Minnesota’s welfare-to-work experiment (Minnesota Family Investment Program, MFIP), which eliminated rules that
restricted eligibility for two-parent families, had some short-term impacts on marital stability. In the longer-term (six
years), those impacts faded for all those studied, though some positive family impacts were found in some subgroups.
See Lisa A. Gennetian, Cynthia Miller, and Jared Smith, Turning Welfare into a Work Support: Six Year Impacts on
Parents and Children from the Minnesota Family Investment Program, MDRC, July 2005. MFIP also had an impact of
raising family incomes, which might have affected family structure independent of the changes in rules for two-parent
families. Further, in the post-welfare period, particularly in the 2000-2007 period, the time series relationship between
single-parent families and welfare receipt changed. Cash welfare receipt declined, while the percentage of babies born
out-of-wedlock and the percent of children in single-parent families increased.
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The Temporary Assistance for Needy Families Block Grant: An Introduction

likely to spend a long time on the rolls. Additional research conducted in the 1980s showed that
mandatory welfare-to-work programs could move families off the rolls and into employment.3
The Family Support Act of 1988 (P.L. 100-485) established in AFDC the notion of mutual
responsibility between the welfare recipient and the state. It created the Job Opportunity and
Basic Skills (JOBS) Training program, which provided employment services, education, and
training for welfare recipients. Following the Family Support Act, states also experimented with
welfare “waivers” of federal law, and began designing their own cash assistance programs and
requirements for welfare recipients. The 1996 welfare law abolished AFDC, and consolidated the
funding of AFDC, a program that provided emergency assistance, and JOBS into the TANF block
grant.
Benefit Amounts
There are no federal rules on how much a state pays needy families in its TANF cash welfare
program. TANF cash welfare benefits in all states represent only a fraction of poverty-level
income. In 2009, the maximum benefit for a family of three was $923 per month in Alaska or
48% of poverty-level income. New York had the highest benefits in the lower 48 contiguous
states and the District of Columbia, paying $721 per month (47% of poverty-level income). In the
median benefit state, Kansas, the maximum benefit for a family of three was $429 per month,
28% of poverty-level income. Mississippi, the state with the lowest benefit levels, paid a family
of three a maximum of $170 per month, 11% of poverty-level income. The maximum benefit is
generally the amount paid for a family with no other income who is complying with program
requirements. For maximum benefits for a family of three by state, see Table A-2 in the
Appendix.
TANF cash benefits have declined over time in real terms because of inflation. States sometimes
make benefit adjustments, but these tend to be ad hoc (not automatic or tied to the inflation rate)
and have failed to keep pace with inflation.
Families that receive TANF cash welfare usually benefit from other programs as well. Most
TANF cash welfare families receive aid from Supplemental Nutrition Assistance Programs
(SNAP, the program formerly known as Food Stamps) and have coverage from Medicaid.
Housing subsidies are received sometimes.
Families with earnings can also get benefits from the Earned Income Tax Credit (EITC) and the
child credit. Many more families with children benefit from these credits than from TANF,
reflecting the shift in philosophy from aiding families without workers to aiding low-income
families with workers.4

3 Judith M. Gueron and Edward Pauly, From Welfare to Work (New York: Russell Sage Foundation, 1991).
4 For a discussion of the shift in emphasis toward aiding low-income families with earnings and its implications for
family income and poverty, see CRS Report R41917, Welfare, Work, and Poverty Status of Female-Headed Families
with Children: 1987-2010, by Thomas Gabe. For a discussion of how this has affected the size and composition of
federal spending on low-income families, see CRS Report R41823, Low-Income Assistance Programs: Trends in
Federal Spending, by Gene Falk.
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The Temporary Assistance for Needy Families Block Grant: An Introduction

State Flexibility Within Federal Requirements
The overarching purpose of TANF is to increase the flexibility of states to operate a program to
achieve its four statutory goals. States have broad flexibility in designing their cash welfare
programs. As discussed above, there are no federal rules that states must follow to determine the
size of the cash benefit paid to a family. Additionally, there are no federal rules for determining
the income eligibility level, how much money a family may have in the bank, the value of a
family’s cars, whether or not a state pays benefits to families with earnings, or other factors that
go into determining a family’s eligibility for TANF and its cash welfare benefit amount.
However, cash welfare paid to a family does come with some federal requirements. States must
meet numerical work participation standards, which specify that a percentage of the cash welfare
caseload must be engaged in certain activities. These standards also require that a minimum
number of hours be spent in these activities, with the hours varying by family type. Guided by
these standards, states themselves design participation rules that apply to individual recipient
families and determine the sanction for families that fail to comply.
The federal TANF time limit prohibits the use of federal funds to aid a family with an adult
recipient beyond 60 months in a lifetime. States are free to use state funds—and even count those
funds toward their MOE requirements—to aid a family beyond 60 months. States may also
impose shorter time limits. Most states do end benefits for families entirely after a certain number
of months, most often 60.
Families that receive TANF cash welfare also must assign (legally turn over) to the state any child
support paid by a noncustodial parent. This is to reimburse the state and the federal government
for the welfare paid to the family. States may pass along collected child support to the family. If
the amount passed through does not adversely affect the family’s eligibility for TANF cash or
reduce its benefit, the pass-through amount can count toward the state’s MOE as state spending
on needy families or be partially financed by the federal government up to a certain level.
The Welfare Caseload
In December 2010, the cash welfare caseload stood at 1.9 million families—about 16% higher
than the 1.7 million families on the rolls in July 2008 when the caseload reached its lowest levels
since 1969. The caseload is down dramatically from its pre-welfare-reform level, reduced by
about two-thirds from the historic peak of 5.1 million families in March 1994.
Figure 2 shows the trend in the monthly number of families receiving cash welfare. It shows the
sharp rise in the caseload in the 1960s and early 1970s, a period of relative stability from 1975
through 1987, the rise in the caseload to its historic peak from 1988 to 1994, and its decline after
1994. The period of rapid decline ended in 2001, coincident with a recession in that year. The
caseload declined more slowly thereafter through July 2008. The uptick in the caseload began in
August 2008 and continued through December 2009. The caseload rise abated in 2010.
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The Temporary Assistance for Needy Families Block Grant: An Introduction

Figure 2. Monthly Number of Families Receiving Cash Welfare: 1959-2010
Cash welfare from Aid to Dependent Children (ADC), Aid to Families with Dependent Children (AFDC),
or Temporary Assistance for Needy Families (TANF)
6
March 1994
5.1 million
5
4
3
Dec. 2010:
1.9 million
2
July 2008:
1
1.7 million
0
9
7
5
0
-5
-62
-65
-68
-71
-74 l-7
-80
-83
-86
-89
-92 l-9
-98
-01
-04
-07
-1
Jul
Jul
Jul
Jul
Jul
Jul
Ju
Jul
Jul
Jul
Jul
Jul
Ju
Jul
Jul
Jul
Jul
Jul

Source: Prepared by the Congressional Research Service (CRS) with data from the U.S. Department of Health
and Human Services (HHS).
Notes: TANF caseload for October 1999 to December 2010 includes families receiving aid in Separate State
Programs (SSPs) that have expenditures countable toward the TANF maintenance of effort requirement.
The post-1994 period saw not only a decline in the cash welfare caseload, but a change in its
composition. The cash welfare population is composed both of families that have been the focus
of the traditional concern about welfare dependency—those in which a parent or parents are not
working but are receiving welfare—and other types of families. These other types represent
families in several different types of situations: families with working adults, families where
nonparent relatives (e.g., grandparents, aunts, uncles) are caring for children for whom they have
no legal financial responsibility, families headed by a disabled parent receiving Supplemental
Security Income, and families with ineligible noncitizen adults who have eligible (usually citizen)
children. All but the first categories of these families come under the umbrella of “child-only”
TANF cases, with the family receiving benefits on behalf of the children but not the adults. These
“child-only” families generally are not subject to work participation requirements or time limits.
Figure 3 shows the number of families receiving AFDC in FY1988 and FY1994 and receiving
TANF cash welfare in FY2008 by family category. It shows that the caseload increase from
FY1988 to FY1994 occurred in all categories. However, the decline in the caseload after FY1994
was concentrated among the “traditional” welfare families, those with an unemployed adult
recipient (or two unemployed adults). This group declined by 80%, compared with a 33% decline
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The Temporary Assistance for Needy Families Block Grant: An Introduction

in the number of families with a working adult and a 5% decline in the total of the “child-only”
categories.
Figure 3. Cash Welfare Families by Family Category: FY1988, FY1994, and FY2008
Child-only/other
6,000,000
Child-only/noncitizen or
5,000,000
unknown citizenship of
parent
Child-only/caretaker
4,000,000
relative
Child-only/SSI parent
3,000,000
Child-only/Adults(s) time-
limited
2,000,000
Child-only/Adult(s)
sanctioned
1,000,000
Families with adult
recipients/At least 1
Employed
-
Family with adult
1988
1994
2008
recipients/ Not employed

Source: Prepared by the Congressional Research Service (CRS) with data from the U.S. Department of Health
and Human Services (HHS).
The trend of a rapid decline in families with an unemployed adult and only a slight decline in
other families means that other types of families comprise a larger share of the remaining
caseload. In FY1988, 84% of all cash welfare families represented the “traditional” family with
an unemployed adult (usually a single mother); by FY2008 this percentage had declined to 36%
of all cash welfare families. In addition, some states continue benefits to the family on behalf of
the children when the parent either is sanctioned off the rolls for failure to comply with program
requirements or hits a time limit. In FY2008, 2.5% of the total caseload was “child-only” with a
parent sanctioned off the rolls and 3.3% were “child-only” with a parent having reached a time
limit. The bulk of families in these two categories were in California, which has a policy of
continuing benefits on behalf of the children in such circumstances. Figure 4 displays the
composition of the cash welfare caseload in FY2008, showing its diversity. Families with
working adults represent 15% of the caseload. Among the child-only categories, the largest group
is children living in families with nonparent relatives, at 16% of the total caseload. Families
headed by SSI adults represent 11% of the caseload. Families with adults who are noncitizens or
whose immigration status is unknown represent 9% of the caseload. Other child-only cases
represent 7% of the caseload.
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The Temporary Assistance for Needy Families Block Grant: An Introduction

Figure 4. Composition of the TANF Cash Welfare Caseload by
Family Category in FY2008
Child-only/other ,
114,250
Child-only/noncitizen
or unknown
citizenship of parent,
159,447
Family with adult
recipients/ Not
employed, 616,240
Child-only/caretaker
relative, 267,486
Child-only/SSI parent,
183,392
Child-only/Adults(s)
Families with adult
time-limited, 55,843
recipients/At least 1
Child-only/Adult(s)
Employed, 254,284
sanctioned, 43,067

Source: Prepared by the Congressional Research Service (CRS) with data from the U.S. Department of Health
and Human Services (HHS).
“Nonwelfare” Activities Under TANF
The fixed funding of TANF combined with the sharp decline in the cash welfare caseload made
available to states new funds to address the broad purposes of TANF. In FY2009, more than half
of federal TANF and state MOE funds were used for activities that are generally not associated
with a traditional welfare program. TANF funds have been and continue to be used for a wide
range of benefits, services, and activities that both address the effects of child poverty and attempt
to deal with its root causes.
Among other things, TANF funds are used to
• support work for low-income families through funding subsidized child care and
refundable tax credits such as state Earned Income Tax Credits (EITCs);
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The Temporary Assistance for Needy Families Block Grant: An Introduction

• provide economic aid to families with children on an emergency and short-term
basis;
• fund programs that address child abuse and neglect; and
• fund early child development programs, such as pre-kindergarten programs and
Head Start programs.
These funds can be used to provide additional help to families who receive cash welfare, but also
to provide benefits and services to the wider population of disadvantaged families with children
in general. TANF state plans and reports indicate that many TANF “services” are provided to
families with incomes well above the cutoff for cash welfare—they still go to low-income
families, but in many states the welfare cutoff is just a fraction of the poverty line, while services
typically are provided to families with incomes of up to 200% of poverty, and in some instances
even higher.
Though states are required to report on how much is spent on TANF “nonwelfare” activities, no
single number of families or children served by these activities is reported. The “nonwelfare” half
of TANF is not as well documented or measured as those activities that relate to traditional cash
welfare programs. This is because TANF reporting requirements date back to the 1996 welfare
reform law and have not evolved with the changes in the use of TANF funds. Since more than
half of TANF and MOE funds were spent on “nonwelfare” activities, the number of families on
cash welfare understates the number of families affected by any TANF benefit or service. Table 1
shows detail on the TANF and MOE “nonwelfare” spending under state programs in FY2009.
Table 1. TANF Nonwelfare Spending by Category for FY2009
(in millions of dollars)
Category
Dollars Expended or Transferred
Child Care

Child care expenditures
$4,133.9
Transfers to CCDF
1,726.7
Total child care
5,860.6


Other Work Supports
State earned income tax credits
1,489.5
State refundable tax credits (other than EITCs)
604.4
Transportation aid
547.1
Total other work supports
2,641.0


Other

Individual development accounts
2.9
Non-recurring short-term benefits
857.0
Prevent nonmarital pregnancies
2,229.5
Two-parent family formation and maintenance
312.3
Assistance based on prior law authority
575.0
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Category
Dollars Expended or Transferred
Nonassistance based on prior law authority
1,091.6
Transfers to SSBG
1,212.3
Other
4,569.6
Total Other Expenditures
10,850.2
Source: Prepared by the Congressional Research Service (CRS) with data from the U.S. Department of Health
and Human Services (HHS).
Many of the categories shown in Table 1 are self-explanatory. Funding for subsidized child care
is the second largest activity (behind cash assistance) funded by TANF. In FY2009, TANF’s
contribution to child care totaled $5.9 billion—$4.1 billion spent in TANF itself and $1.7 billion
transferred to the Child Care and Development Fund (CCDF).5
The “other work supports” category is primarily refunds under state earned income tax credits.
These state credits supplement the federal earned income tax credit (EITC), providing earnings
supplements to low-income workers.
The large, catchall “other” category totaled $10.9 billion in FY2009. This category includes
expenditures of $857 million for “emergency and short-term benefits.” These benefits represent
payments made to families in lieu of ongoing cash welfare to help them get through a family
crisis (e.g., to avoid evictions or foreclosures, or to get vehicles repaired so they can have
transportation to work). Activities authorized under prior law reflect those that states had under
their pre-1996 Emergency Assistance programs that a state could not “reasonably calculate”
would help achieve one of the four goals of TANF. These activities include foster care and
adoption assistance (for children not eligible for other federally funded foster care and adoption
assistance) and funding for state juvenile justice systems. In addition, the “other expenditures”
category includes programs that relate to child abuse and neglect and early childhood
development programs, such as pre-Kindergarten programs. The category also includes
expenditures for the two sets of activities related to family formation and structures: preventing
out-of-wedlock pregnancies ($2.2 billion in FY2009 expenditures) and promoting two-parent
families ($0.3 billion in FY2009 expenditures). Finally, in FY2009, states transferred $1.2 billion
to the Social Services Block Grant, which funds a wide range of human services activities.
Conclusion
TANF is not a program, but rather a flexible funding stream that states can use to provide a wide
range of benefits, services, and activities. TANF is not simply another term to describe state cash
welfare programs. More than half of TANF money goes to activities outside what one would
describe as being part of a traditional cash welfare program. Even within the cash welfare
caseload, less than half of all families represent families with an unemployed adult recipient,
which have been the focus of the traditional policy interest of moving families from welfare to
work.

5 For a discussion of the child care block grant, see CRS Report RL30785, The Child Care and Development Block
Grant: Background and Funding, by Karen E. Lynch.
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The Temporary Assistance for Needy Families Block Grant: An Introduction

The issues related to TANF broadly span those that reflect the effects and address the root causes
of disadvantage among families with children. Table 2 shows the trends in select economic and
social indicators for families with children from the year just before the enactment of the welfare
reform law (1995) and for 2000, 2007, and 2010.
The child poverty rate declined during the late 1990s, from 20.8% in 1995 to 16.2% in 2000.
However, in the 2000s, even before the onset of the recession, child poverty rates increased. In
2007, the child poverty rate stood at 18%. In the recession year 2009, the child poverty rate had
increased to 20.7%. In 2010, the child poverty rate stood at 22.0%.
Child poverty has well known correlations to employment status of the parents(s) and family
structure, with children in families headed by a single mother more likely to be poor than children
in married couple families. The employment rate among single mothers—the group most at risk
of heading families with children in poverty and being cash welfare recipients—increased fairly
dramatically (over 10 percentage points) in the late 1990s to 75.5% in 2000. This rate declined
after 2000, never fully recovering to its peak 2000 level even at the end of the economic
expansion in 2007.
The percent of babies born out of wedlock never declined during the post-welfare-reform period.
However, it increased slowly in the late 1990s. It rose fairly rapidly during the period from 2000
to 2009, standing at 41.0% of all births in 2009 (the latest year for which data are available).
Table 2. Selected Economic and Social Indicators for Families with Children,
Selected Years 1995 to 2010
Indicator 1995
2000
2007
2010
Child poverty rate
20.8%
16.2%
18.0%
22.0%
Number of poor
14.7 11.6 13.3 16.4
children
(in millions)
Employment rate
64.0% 75.5% 72.8% 67.0
for single mothers
Percent of births
32.2% 33.2% 39.7% NA
out-of-wedlock
Source: Prepared by the Congressional Research Service (CRS) with data from the U.S. Department of Health
and Human Services (HHS) and U.S. Census Bureau.
TANF is currently funded through February 29, 2012. Decisions about TANF in the 112th
Congress will occur in the shadow of the lingering effects of the 2007-2009 recession. However,
these decisions will also occur in the context of the trends of the 2000 to 2007 period before the
recession, which indicate more children were living in, and more children were being born into a
situation associated with, economic and social disadvantage.
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The Temporary Assistance for Needy Families Block Grant: An Introduction

Appendix. Selected State Tables
Table A-1. Federal TANF State Family Assistance Grants, Annual Grant Amounts
Percent of
Total, 50
States and
Dollars in
District of
State
Millions
Columbia
Alabama $93.3
0.6%
Alaska
63.6 0.4
Arizona
222.4 1.3
Arkansas
56.7 0.3
California 3,733.8
22.6
Colorado 136.1
0.8
Connecticut 266.8
1.6
Delaware 32.3
0.2
District of Columbia
92.6
0.6
Florida
562.3 3.4
Georgia 330.7
2.0
Hawaii
98.9 0.6
Idaho
31.9 0.2
Illinois
585.1 3.5
Indiana
206.8 1.3
Iowa
131.5 0.8
Kansas
101.9 0.6
Kentucky 181.3
1.1
Louisiana 164.0
1.0
Maine
78.1 0.5
Maryland 229.1
1.4
Massachusetts 459.4
2.8
Michigan 775.4
4.7
Minnesota 268.0
1.6
Mississippi 86.8
0.5
Missouri 217.1
1.3
Montana
45.5 0.3
Nebraska 58.0
0.4
Nevada
44.0 0.3
New Hampshire
38.5
0.2
New Jersey
404.0
2.5
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The Temporary Assistance for Needy Families Block Grant: An Introduction

Percent of
Total, 50
States and
Dollars in
District of
State
Millions
Columbia
New Mexico
126.1
0.8
New York
2,442.9
14.8
North Carolina
302.2
1.8
North Dakota
26.4
0.2
Ohio
728.0 4.4
Oklahoma 148.0
0.9
Oregon
167.9 1.0
Pennsylvania 719.5
4.4
Rhode Island
95.0
0.6
South Carolina
100.0
0.6
South Dakota
21.9
0.1
Tennessee 191.5
1.2
Texas
486.3 2.9
Utah
76.8 0.5
Vermont
47.4 0.3
Virginia
158.3 1.0
Washington 404.3
2.5
West Virginia
110.2
0.7
Wisconsin 318.2
1.9
Wyoming 21.8
0.1



Total 50 States and District of Columbia
16,488.7
100.0
Source: Prepared by the Congressional Research Service (CRS) based on data from the U.S. Department of
Health and Human Services (HHS).
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The Temporary Assistance for Needy Families Block Grant: An Introduction

Table A-2. Monthly TANF Cash Welfare Maximum Benefit Amount
for Family Sizes of Two and Three, July 2009

Family Size of Two

Family Size of Three
Percent of
Percent of
Poverty
Poverty
State Dollars
Threshold Dollars Threshold
Alabama $190
15.6%

$215
14.1%
Alaska 821
54.1

923
48.4
Arizona 220
18.1

278
18.2
Arkansas 162
13.3
204
13.4
California 561
46.2
694
45.5
Colorado 364
30.0
462
30.3
Connecticut 457 37.6
560 36.7
Delaware 270
22.2
338
22.2
District of
336 27.7
428 28.1
Columbia
Florida 241
19.8

303
19.9
Georgia 235
19.4

280
18.4
Hawai 506
36.2

636
36.2
Idaho 309
25.4

309
20.3
Illinois
318 26.2
432 28.3
Indiana 230
18.9

288
18.9
Iowa 361
29.7

426
27.9
Kansas 352
29.0

429
28.1
Kentucky 225
18.5
262
17.2
Louisiana 188
15.5
240
15.7
Maine 363
29.9

485
31.8
Maryland 453
37.3
574
37.6
Massachusetts 531 43.7

633 41.5
Michigan 403
33.2

492
32.2
Minnesota 437
36.0
532
34.9
Mississippi 146
12.0
170
11.1
Missouri 234
19.3

292
19.1
Montana 401
33.0

504
33.0
Nebraska 293
24.1
364
23.9
Nevada 318
26.2

383
25.1
New Hampshire
606
49.9

675
44.2
New Jersey
322
26.5

424
27.8
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The Temporary Assistance for Needy Families Block Grant: An Introduction


Family Size of Two

Family Size of Three
Percent of
Percent of
Poverty
Poverty
State Dollars
Threshold
Dollars Threshold
New Mexico
357
29.4

447
29.3
New York
524
43.1

721
47.3
North Carolina
236
19.4

272
17.8
North Dakota
378
31.1

477
31.3
Ohio 355
29.2

434
28.4
Oklahoma 225
18.5
292
19.1
Oregon 436
35.9

514
33.7
Pennsylvania 316 26.0
403 26.4
Rhode Island
449
37.0

554
36.3
South Carolina
215
17.7

271
17.7
South Dakota
482
39.7

539
35.3
Tennessee 142 11.7
185 12.1
Texas 211
17.4

244
16.0
Utah 380
31.3

474
31.1
Vermont 536
44.1
640
41.9
Virginia 254
20.9

320
21.0
Washington 453 37.3
562 36.8
West Virginia
301
24.8

340
22.3
Wisconsin 628 51.7
628
41.2
Wyoming 514
42.3
546
35.8






Maximum 821
54
923
48
Minimum 142
12
170
11
Median 352
29

429
28
Source: Congressional Research Service (CRS), based on data in the Urban Institute’s Welfare Rules Database,
funded by the U.S. Department of Health and Human Services (HHS).

Author Contact Information

Gene Falk

Specialist in Social Policy
gfalk@crs.loc.gov, 7-7344


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