By Fiona Lu and Ashley Burnside,

Since its creation in 1996, the Temporary Assistance for Needy Families (TANF) program has provided cash assistance to a smaller and smaller share of families with low incomes. One reason is that many states have never rethought their TANF programs, leaving them stuck with outdated rules and paternalistic requirements. August 22 represents 28 years since Congress enacted the Personal Responsibility and Work Opportunity Act, which first created the TANF program. Given this milestone, states should take the newly established pilot opportunity to update their TANF programs to support families.

Last year’s Fiscal Responsibility Act authorized new pilots under TANF, creating an exciting opportunity for up to five states to have their success measured not by the process-focused work participation rate (WPR), but by outcomes tied to earnings and family stability and well-being. The pilot represents one important step in turning TANF into a program that adequately reaches families and effectively supports them in times of financial emergencies. The Administration for Children and Families (ACF) has now released the application for states to apply for this pilot.

What is TANF?

The TANF program provides cash assistance to families with low incomes. The program is funded through a federal block grant to states and with state dollars. The federal government holds states accountable for reaching TANF goals through the WPR, which places an emphasis on recipients participating for the required number of hours in a limited list of countable activities, instead of whether TANF improves the whole family’s well-being. If individuals fail to meet the work requirements, they can be sanctioned by losing support from the TANF program, often for an extended period of time.

Tying assistance to fulfilling strict work requirements poses challenges for families with low incomes who are often encountering financial emergencies, like domestic violence or homelessness. Due to this requirement, the program does not focus on higher quality of work; the efficacy of work programs; or addressing potential barriers to work such as education, training, or caregiving. The new pilot program provides an opportunity for states to rethink their programs and implement more effective outcome measures for TANF participants.

How Does the Pilot Program Work?

For up to five chosen states, this pilot program is set to begin on October 1, 2024 and sunset on October 1, 2030. The first year of the pilot will be for baseline data collection. States in the pilot are still expected to have an engagement plan for TANF recipients and have a sanction policy for individuals who do not meet their required engagement activities. The selected states will not be held to the WPR requirements during engagement in the pilot. ACF will measure state-specific family stability and well-being outcomes through one economic domain measurement (i.e. job quality, job access, or job security) and one measurement from another domain, which can be chosen from health, education, community, or social categories. States in the pilot program will participate in a federally funded implementation and outcomes study to assess differences for TANF participants between pilot states and non-pilot states. States will not receive additional federal funds for their participation in the pilot. To apply, states must submit their proposals to ACF by September 3, 2024.

The pilot creates an opportunity for states to be innovative and design their program based on the specific needs of their state. While other changes are urgently needed within the TANF program, this represents one critical step in reforming TANF to be a more effective and human-centered program. The pilot provides important opportunities for states.

• States can adopt client-driven, individualized engagement plans. Because states won’t be held to the WPR, agencies can allow TANF clients to set goals for themselves and their families, and to determine the steps and resources needed to achieve those goals.
• States can serve families outside of those currently receiving cash assistance who would benefit from such services, such as people experiencing housing instability/homelessness or domestic violence. This is important since few families experiencing poverty are currently receiving TANF cash assistance.
• States can partner with people who have lived experience with TANF, or lived experience of not being able to access TANF when they needed the support, when designing the pilot. This expertise would be critical in ensuring that the program is designed in a way that is equitable, accessible, people-centered, and affirming.

Even if states are not accepted into the pilot, they still have the opportunity to make these innovations in their state TANF programs. The caseload reduction credit leaves many states with great flexibility in meeting their WPR requirements without facing a financial penalty. States should take advantage of this flexibility to rethink their TANF programs, whether or not they are selected for the pilots.