Beliefnet

This article is adapted from a sermon given by Fr. Mark Hallinan on November 4, 2001.

These are tough times for many Americans as the economic reverberations of the events of September 11th continue to be felt across our nation. Our social safety net needs to be strong so as to provide needed assistance for all those who are affected by our weakening economy. In the coming year, Congress will have to revisit its `welfare reform' legislation that was first passed in 1996. As persons of faith, we have a responsibility to insure that Congress acts responsibly and with a genuine regard for those in need.

In 1996, Congress passed the "Personal Responsibility and Work Opportunity Reconciliation Act" (PRWORA). This legislation marked a fundamental change in the way our government responded to those in poverty. The key change was the elimination of the federal-state cash assistance program known as Aid to Families with Dependent Children (AFDC). AFDC had guaranteed government assistance to families on the basis of need, for as long as they were in need.

It was replaced with a program called Temporary Assistance for Needy Families (TANF) that imposed strict time limits on the receipt of federal benefits. Under this new program, the federal government gave each state a fixed amount of money, a block grant, for the next five years to fund welfare programs. This block grant was based on the size of a state's welfare population in 1995. States were given wide discretion to design their own welfare programs using federal money, though all states are bound by the following conditions:

  • Under TANF, poor families are no longer entitled to federal assistance whenever they are in need; with limited exceptions they are subject to a maximum lifetime limit of 60 months (5 years) of benefits funded by the federal government (states can provide benefits for a longer period but cannot use federal funds to do so).
  • TANF recipients were required to participate in some form of job program.
  • States do not have to use TANF funds to provide cash assistance only, they can also spend the funds on other programs that support the goals of TANF.
  • The way this legislation was structured, states had a strong incentive to move as many people as possible off of the welfare rolls and to do it as fast as they could. The states were receiving a fixed grant from the federal government based on welfare populations in 1995. As those populations dropped, their federal grant remained the same. This left most states with enormous welfare surpluses that presented intriguing possibilities for state governments.

    Those states that have had the most success in helping persons move from welfare to independence through work are those that have used their federal funds to provide a full range of needed benefits--job training, drug treatment, child care, housing and transportation subsidies, and health care. Providing such benefits was not a financial problem for most states. In Wisconsin, for example, the state was receiving $4,100 from the federal government in 1995 for each family on the welfare rolls. With a dramatic drop in welfare rolls, Wisconsin theoretically had enough federal funds in the year 2000 to spend $22,000 per case. While Wisconsin has been a leader in providing real and meaningful benefits to assist welfare recipients to move into independent living, it still managed to husband $100 million in federal funds that through creative accounting allowed the state to pass a tax cut that did not benefit the poor. In New York, the state has spent about $5 billion of the $6.1 billion dollars it has received from the federal government for programs in service of the poor. The remaining $1 billion was used to finance programs for the poor that the state and local governments were funding so that state and municipal funds could be freed for more politically popular programs. With states finding creative ways to use `welfare surpluses' for purposes other than creating new opportunities for those in need, Congress may well decide to make significant cuts in federal funding when it passes new welfare legislation. With a weakening economy and rising unemployment, this could have a devastating impact on those needing assistance. It could also reverse gains that have been made in helping low-income workers meet their basic needs through state subsidized benefits.

    In New York, there is both good news and bad news for those persons facing the five year limit on receiving federal assistance. The good news is that our state constitution requires that the poor be given aid and so there is a program in place to provide assistance to those who have reached the limit on federally funded welfare benefits. Advocates for the poor anticipated a seamless transition from federally funded assistance to state funded assistance as recipients would simply have their cases transferred. Unfortunately, the Commissioner of the state Office of Temporary and Disability Assistance, Brian Wing, has announced that all county offices providing relief assistance must require current recipients of aid to reapply for the state financed program. Only New York City had requested this policy. Other county commissioners were opposed to this policy because of the burden it would put on them and on those requiring aid. It is widely acknowledged that many deserving persons will lose the help they need because of the cumbersome process that will be required to reapply for assistance. This has proven to be true as the New York Times reported on December 20th that several thousand welfare recipients have lost their benefits in this transition period and there are cases where the denial of benefits was clearly in error.

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