Welfare-Reform Legislation Since (1996) - State Flexibility Regarding Waivers

Under the welfare-reform law, states that had received approval for waivers prior to July 1, 1997, were given the option to continue those cash assistance programs under some or all of those waivers. States were allowed to retain provisions that were inconsistent with the new law until their waivers expired if they accepted the option of continuing cash assistance programs covered by the waivers. However, the law limited the extent to which inconsistencies apply so as to maintain the law's strong work requirements.

The most common inconsistencies with the law's provisions for which waivers were claimed included the law's work and participation requirements. For instance, the law states that individuals must be engaged in work within twenty-four months without expressly providing for any exemptions. Vermont is operating under a waiver that requires individuals to obtain employment within thirty months.

Another inconsistency between the welfare-reform law and state waivers concerns time limits. The law requires the termination of assistance after five years but includes a 20 percent hardship exemption. As of June 2002, eight states were operating under waivers from the time-limit requirements. Most of these waivers expired in 2003. The TANF reauthorization signed into law on October 1, 2003 neither discontinued nor extended unexpired waivers.

Other areas inconsistent with the welfare law's provisions include those related to penalties for noncompliance with work requirements, transitional assistance, teen-parent school attendance, teen-parent living-arrangement requirements, and child-support cooperation penalties. The Department of Health and Human Services must review the state plans and approve the inconsistencies due to waivers.