Welfare-to-Work Programs - Support Services Necessary For Moving Recipients To Work

Child Care

The offer of affordable child care is one critical element in encouraging low-income mothers to seek and keep jobs. A recent U.S. General Accounting Office report noted that "any effort to move more low-income mothers from welfare to work will need to take into account the importance of child-care subsidies to the likelihood of success." A study in Minneapolis discovered that about one-fourth of the former welfare recipients on the waiting list for child care went back on welfare when the child-care services never materialized. According to the 1998 Kids Count, an annual report produced by the Annie E. Casey Foundation that tracks different aspects of child well-being status from year to year, child-care expenses consume about one-fourth of the earnings of low-income families earning less than $1,200 a month.

The 1996 welfare reform law created a block grant to states for child care. The amount of the block grant was equivalent to what states received under AFDC. However, states that maintain the amount that they spent for child care under AFDC are eligible for additional matching funds. The block grant and the supplemental matching funds are referred to as the Child Care Development Fund (CCDF). In addition, states were given the option of transferring some of their TANF funds to the CCDF or spending them directly on child-care services. As a result, the amount allocated for child care through the CCDF and TANF ($7.1 million in 2000) has more than tripled since 1997, when $2.1 million was allocated to the states.

Because states may use TANF funds for child care, they have more flexibility than before to design child-care programs, not only for welfare recipients but also for working-poor families who may need child-care support to continue working and stay off welfare. States determine who is eligible for child-care support, how much those parents will pay (often using a sliding fee scale), and the amount a state will reimburse providers of subsidized care.

In 2000 states provided child-care subsidies to 1.9 million low-income children, up from one million children in 1996. Approximately 70 percent of the children are cared for in child-care centers or licensed family child-care homes. The remaining 30 percent of children are cared for in more informal settings, including arrangements with friends and relatives. Despite the dramatic increase in the provision of child care to low-income families, many eligible families are still not receiving assistance.

Transportation, Access to Jobs

Transportation is another critical factor facing welfare recipients moving into a job. Recipients without a car must depend on public transportation. Yet two of three new jobs are in suburban areas, often outside the range of public transportation. Even when jobs are accessible to public transportation, many day-care centers and schools are not. Some jobs require weekend or night shift work, when public transportation schedules are limited. Even for those recipients with cars, the expense of gas and repairs can deplete earnings.

To promote employment, the vehicle asset limits under TANF are broader than under AFDC. While each state has the flexibility to determine its own vehicle asset level, all states have chosen to increase the limit for the value of the primary automobile in the family beyond that set under AFDC. In addition, twenty-eight states disregard the value of at least one vehicle in the family. The remaining states exclude from $3,959 to $12,000 of the car's value.

According to the U.S. Department of Transportation, states use a variety of approaches to provide transportation for TANF recipients moving into the workforce:

• Reimbursing work-related transportation expenses (automobile expenses or public transportation).
• Providing financial assistance in the form of loans or grants in order to purchase or lease an automobile.
• Filling transit service gaps, such as new routes or extended hours.
• Providing transit alternatives, such as vanpools or shuttle services.
• Offering entrepreneurial opportunities for recipients to become transportation providers.
• Transferring TANF funds to the Social Services Block Grant in order to develop the transportation infrastructure for the working poor in rural areas and inner cities.