Misappropriation of TANF funds

Two weeks ago the Georgia Budget and Policy Institute published a report: Georgia’s Allocation of Federal TANF Funds in FY 2010. Before getting into the details of the report let's briefly outline what Temporary Assistance to Needy Families (TANF) stands for.

TANF is the United States of America's federal assistance program, formerly known as “welfare”. It began on July 1, 1997, and succeeded the Aid to Families with Dependent Children (AFDC) program, providing cash assistance to indigent American families with dependent children through the United States Department of Health and Human Services.

The purposes of the TANF program as described in section 401 of the Social Security Act are as follows:

  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.

TANF sets forward the following work requirements necessary for benefits:

  1. Recipients (with few exceptions) must work as soon as they are job ready or no later than two years after coming on assistance.
  2. Single parents are required to participate in work activities for at least 30 hours per week. Two-parent families must participate in work activities 35 or 55 hours a week, depending upon circumstances.
  3. Failure to participate in work requirements can result in a reduction or termination of benefits to the family.
  4. States, in FY 2004, have to ensure that 50 percent of all families and 90 percent of two-parent families are participating in work activities. If a state reduces its caseload, without restricting eligibility, it can receive a caseload reduction credit. This credit reduces the minimum participation rates the state must achieve.

The institution of TANF more or less silenced a debate that lasted for more than two decades between those that oppose welfare and those that value it. The debate really caught fire through the invocation of the stereotype going by the moniker "welfare queen" and never really rose above that stereotypical level.

The welfare debate revolved around a very ancient notion of the "deserving poor" and the "undeserving poor", a distinction between those that are poor through no fault of their own and those that are poor because they are stupid and lazy. This distinction can at least be traced back to the English Poor Laws of 1601 and has been part of the discourse involving poverty relief in Ango-Saxon countries ever since.

As with every intervention in society, welfare creates false positives (people that don't deserve help, but do receive it) and false negatives (people that deserve help, but don't receive it). And as in most debates, people rally either behind the notion of false positives or they rally behind the notion of false negatives. Some people can't stand the idea of someone not making any effort to take personal responsibility while cashing in a welfare check, other people can't stand the idea of children being homeless, not knowing when they will have their next meal.

TANF decided the debate in favour of those that are appalled with the false positives and meant a serious reduction of welfare as it had existed in the United States since the Great Depression. Maybe the debate will take another turn in the next couple of years, because the current economic crises creates many new "deserving poor", but that remains to be seen.

Since TANF was introduced in 1997, the funding of it has been cut significantly and in many cases those that are eligible for it are being discouraged to apply for it. Mother Jones ran an interesting article in February of this year by the title Brave New Welfare, that digs into the real world behind TANF in the State of Georgia.

Unlike it's predecessor, the Assistance to Families with Dependent Children, TANF is a federal block grant, which means the federal government grants money to the state governments with only general provisions as to the way it is to be spent. Ideally this allows state governments to spend the money most fitting the local needs, but it also opens the door for misappropriation of funds.

Two weeks ago, the Georgia Budget and Policy Institute showed how such misappropriations exist in the State of Georgia. The report states:

Under HB 119, lawmakers increased funding for child welfare related-services — Adoption Assistance, Child Welfare Services, and Out of Home Care — from $205 million to $219 million, by allocating 60 percent of Georgia’s annual TANF award ($368 million) to them. As a result less than half of TANF funds are now available for programs directly related to its four purposes, e.g., work assistance and subsidized child care.

So instead of spending TANF money on poor families so that children may be cared for in their own homes or in the homes of relatives, as is the primary goal of the program, the State of Georgia is spending the money on taking care of children whose families have already been broken.

It wouldn't be so bad, if the primary reason for children to enter the foster care system wasn't poverty related. By funneling TANF money to the child placement system, the State of Georgia diverts money away from addressing the cause (poverty), to spend it on treating the symptoms (neglect). Poor people suffer from this, children suffer from this and society suffers from this. The only ones benefiting are the ones in the business of treating symptoms. As such the child placement system is not different from the pharmaceutical industry, the prison system or the religious industry, all these lines of business fare well when suffering is continued and prevention is being discouraged.

A quick round on the internet reveals Georgia is not the only state misappropriating TANF money to plug holes in their child placement budget.

Connecticut:

This fiscal year, about $129 million in federal Temporary Assistance to Needy Families grant money will be used to offset about 17 percent of the state Department of Children and Families' budget, according to Oliveira.

from: Child Care Funds Lacking, Hartford Courant, March 25, 2006

Nevada:

Clark County commissioners on Tuesday approved hiring 55 new social workers for the Department of Family Services, a move aimed at keeping children safer, settling a child advocacy group's lawsuit, and stanching federal criticism of the county's troubled child welfare system.

Family Services Director Tom Morton said the staff boost will allow the agency to expand Child Protective Services' response to assist police who come across abused or neglected children to weekends and overnight.

...

County Manager Virginia Valentine told the commission that the state has committed to funding the $3.2 million annual cost of the 55 positions for 2½ years beginning in January. The money was allocated to Nevada from a federal fund called TANF, or Temporary Assistance for Needy Families.

from: Commission approves 55 more social workers, Las Vegas Review-Journal, October 4, 2006

Michigan:

More than $41 million in TANF money is diverted each year into adoption subsidies and adoption support services.

from: Cycle of Failure, National Coalition for Child Protection Reform, February 18, 2009

Louisiana:

With money being stripped from the Court Appointed Special Advocate program, which is run through the Volunteers for Youth Justice, many juveniles in the court system could lose one of their main defenders.

CASA volunteers provide information to judges relative to the goal of a safe, permanent home for the child, taken from their home due to abandonment, abuse or neglect. The program needs more than $100,000 prior to August to keep afloat the number of children served. Without the money, more children will be without a volunteer.

....

For three years, CASA has been supported through federal Temporary Assistance for Needy Families funds, which has financially allowed CASA to expand its services from Caddo - where it began in 1992 - to four additional parishes: Bossier, Webster, Desoto and Sabine.

from: Workers to keep volunteer services, The Shreveport Times, February 9, 2004

West Virginia:

The department transferred $6.7 million in 1999, $7.3 million in 2000 and $3.9 million in 2001 out of the its Office of Social Services. That office provides child care, foster care and other treatments for abused and neglected children. 

To make it up, the state spent welfare money, called Temporary Assistance to Needy Families, or TANF.

....

Some of the money also went to higher payments to foster parents, more children in state custody and programs to prevent abuse and neglect.

from: State welfare savings mean child care cuts, Charleston Gazette, November 16, 2001

When it comes to TANF, some will say it doesn't go far enough and all welfare should be abolished, some will argue that TANF does little to help the poorest in the country and the program should be seriously expanded. If we could move beyond the stereotypical debate of the 1980's and 1990's, things could be improved, both in the direction of participation of unemployed in the work place and in the protection of those that are incapable to do so.

For now welfare is organized along the lines of TANF and as such that law should be properly executed. Funneling money intended to help struggling families to Child Protective Services, foster care and adoption assistance will only help the continuation of the problem. Less money to the most needy families will mean more homeless children, which will lead to more foster care placement due to neglect (not being able to provide children a roof over their heads is called neglect). More foster care placements will lead to a higher case load, as a result of which there is less time to investigate abuse cases.

Treating only symptoms without addressing the cause is a downward spiral at worst and a vicious circle at best. Of course it is the preferred course of action for service providers. The continuation of the problem, means a continuation of their income.

All this makes me think of this comment:

During a cozy dinner with a pharmaceutical CEO, I asked what his challenge was in the near future: what illnesses would he like to cure?

The stunning answer: We are not looking for cures, we are looking for illnesses that need LIFELONG treatment.

It doesn't really matter if we are talking about the pharmaceutical industry or the child placement system, in either case there is a vested interest in the treatment of symptoms and in either case the perpetuation of the problem is in the interest of the organization. As long as the execution of the law, such as the appropriation of TANF funds, feeds into the needs of such organizations we will all lose. Not only those for whom TANF is intended will become poorer and poorer, but society at large will keep feeding a costly bill that will never get smaller.

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