Temporary Assistance for Needy Families: The Decline in the Cash Assistance Caseload

Temporary Assistance for Needy Families: The Decline in the Cash Assistance Caseload

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May 17, 2018
Temporary Assistance for Needy Families: The Decline in the
Cash Assistance Caseload
Introduction
caseload increased by 1.4 million because the number of
The Temporary Assistance for Needy Families (TANF)
people eligible for benefits rose from 16.8 million to 21.6
block grant helps fund public assistance programs for needy
million. Following the recession, the number of people
families with children, families often headed by a single
eligible for assistance again declined along with an even
mother. It was created in the 1996 welfare reform law, P.L.
faster decline in the caseload. By 2015, 27% of the 18.0
104-193, which ended the prior federal grant to states for
million eligible for cash assistance received it. Over the
public assistance, Aid to Families with Dependent Children
entire 1995 to 2015 period, most of the caseload decline
(AFDC). TANF has an explicit statutory goal to end the
resulted not from fewer people being eligible for aid, but
dependence of needy parents on government benefits and
from fewer of the eligible people actually receiving
the decline in the cash assistance caseload is the most
benefits.
visible indicator of progress toward meeting that goal.
Figure 1. Number of People Eligible for and Receiving
In 1995 an estimated 17.6 million people (adults and
Cash Assistance, Selected Years
children) received assistance during the year compared to
4.9 million in 2015. However, most of the TANF cash
assistance caseload decline comes from fewer eligible
people receiving assistance, rather than from there being
fewer eligible people.
This In Focus examines the TANF caseload decline in the
context of those eligible for its assistance as well as child
poverty. It summarizes and updates information in CRS
Report R44724, Temporary Assistance for Needy Families
(TANF): Size of the Population Eligible for and Receiving
Cash Assistance.
Number of People Eligible for and
Receiving TANF Cash Assistance
Figure 1 shows the number of people eligible for and
receiving AFDC in 1995, and the proportion of eligible

individuals who received benefits in that year. In 1995, 21.6
Source: Congressional Research Service (CRS) analysis based on
million persons were eligible for AFDC cash assistance,
estimates from the TRIM3 micro-simulation model.
with 82% of those eligible (17.6 million) receiving benefits
Notes: Includes people in state-funded public assistance programs
during that year. The figure compares these numbers and
who are eligible for TANF, but excludes families receiving relatively
the rate of eligible people receiving TANF cash assistance
small TANF-funded earnings supplements outside of regular TANF
for selected years. The number of people receiving cash
programs.
assistance declined most rapidly in the late 1990s. By 2000,
the caseload had declined from an estimated 17.6 million
The Decline in the Cash Assistance
persons to 7.9 million. This decline stemmed from both
Caseload and Child Poverty
fewer people being eligible for benefits and a decline in the
The majority of cash assistance recipients are children. Of
share of eligible people receiving benefits. The rate at
the 17.6 million persons receiving AFDC in 1995, 11.5
which eligible people received benefits in 2000 had fallen
million were children. Of the 4.9 million people receiving
to a little less than half (47%).
assistance in 2015, 3.5 million (more than 70% of
recipients) were children.
The figure also shows the fluctuations in the caseload
during the 2000s. In the period from 2000 to 2007, the
Cash assistance does not reach all poor children in part
caseload continued to fall, but this was almost wholly
because of the way eligibility is determined. Not all poor
attributable to a decline in the share of eligible people who
children were eligible for AFDC; nor are all poor children
actually received benefits, which declined to 34% by 2007.
eligible for TANF. States determine income eligibility for
The period from 2007 to 2010 shows caseload trends during
TANF (as they did for AFDC before it). In 1995, most
the Great Recession of 2007-2009. During this period, the
states set their income eligibility threshold below the
estimated share of eligible people receiving benefits held
poverty level; this has also been true under TANF.
fairly steady (33% in 2010). However, at the same time, the
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Temporary Assistance for Needy Families: The Decline in the Cash Assistance Caseload
Figure 2 shows the percent of children in families with
shows the effect of AFDC assistance income in 1995, and
income below the poverty level who were eligible for and
TANF assistance income in subsequent years, on deep
receiving AFDC in 1995, and eligible for and receiving
poverty, measured as incomes below 50% of the poverty
TANF in selected years. In 1995, 66% of poor children
threshold. AFDC income reduced the deep poverty rate
were eligible for AFDC. In 2015, 52% of poor children
from 11.2% to 6.6%. In contrast, in 2015, TANF assistance
were eligible for TANF. The share of poor children
decreased the child deep poverty rate from 8.2% to 7.6%.
receiving AFDC in 1995 was 55.6%. The percentage of
poor children receiving TANF in 2015 stood at 18%.
Figure 4. Child Deep Poverty Rates Based on Pre-
Assistance and Post-Assistance Income, Selected
Figure 2. Percent of Poor Children Eligible for and
Years
Receiving Cash Assistance, Selected Years

Source: Congressional Research Service (CRS) analysis based on

estimates from the TRIM3 microsimulation.
Source: Congressional Research Service (CRS) analysis based on
estimates from the TRIM3 microsimulation
How has the decline in the share of poor children receiving
cash assistance affected the poverty rate? Figure 3
Conclusion
compares child poverty rates using income that does not
The cash assistance caseload decline has been seen as one
include assistance (AFDC assistance in 1995, and TANF
of the prime indicators that TANF made progress in
assistance thereafter) and income with assistance included.
achieving the goal of ending the dependence of needy
Neither AFDC nor TANF moved large numbers of families
families on government benefits. However, most of the
above the poverty line. In 1995, AFDC income reduced the
caseload decline has resulted from a decline in the rate at
observed poverty rate by 0.9 percentage points. In 2015,
which people eligible for assistance actually receive
TANF has reduced the observed poverty rate by 0.2
benefits, rather than a decline in the population in need. In
percentage points.
2015, 18.0 million people were eligible for TANF
assistance, but 4.9 million (27%) received it.
Figure 3. Child Poverty Rates Based on Pre- and Post-
Family Assistance Income, Selected Years
The drop in the share of TANF-eligible individuals who
receive benefits raises the question of whether a goal of
TANF should be caseload reduction per se, regardless of
whether or not the size of the population in need is growing.
TANF was to be “temporary and provisional,” however the
data indicate that TANF is increasingly forgone or
otherwise not received by those eligible for it, even among
the poorest of families. Other means-tested programs that
have grown in terms of spending and recipients (e.g., the
Earned Income Tax Credit, the Supplemental Nutrition
Assistance Program, and Medicaid) do not provide ongoing
cash assistance to families to meet basic needs. If
policymakers conclude there is an unmet need for such
assistance, they might consider policies that would
eliminate some TANF provisions that encourage states to
reduce caseloads (e.g., end allowing states to meet all or
Source: Congressional Research Service (CRS) analysis based on
part of their work participation standards through caseload
estimates from the TRIM3 microsimulation
reduction) or consider other alternatives outside of TANF.

Gene Falk, Specialist in Social Policy
Though AFDC did little to change the child poverty rate, it
did reduce the severity of poverty for children. Figure 4
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Temporary Assistance for Needy Families: The Decline in the Cash Assistance Caseload

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