Almost Half of the States Have Some Type of Family Cap Policy; Goals of the Family Cap Policy Include Reducing Out-of-Wedlock Births and Increasing Self- Sufficiency

Twenty-three states, covering approximately 52 percent of the TANF caseload nationwide, have adopted the family cap policy in some form. In these states a family’s cash grant is not increased by any amount with the birth of an additional child. Additional Resources Are Available to Capped- Benefit Families in Some States

Four states with a family cap on benefits give families vouchers equal to the traditional cash benefit increase they would have received in the absence of a cap. About 108,000 Families Had Their Cash Benefits Capped in an Average Month

Based on responses of 20 states with family cap policies, about 108,000 families receiving TANF had their benefits affected by the family cap, in an average month during 2000. Several factors, including family earnings and other resources, such as receipt of child support, influence the amount of cash benefits a family receives. These families had more than one child whose benefits were affected by the cap. Existing Studies Cannot Be Used to Cite Conclusive Evidence About the Impact of the Family Cap on Out-of- Wedlock Births

Due to limitations of the existing research, we cannot conclude that family cap policies reduce the incidence of out-of-wedlock births, affect the number of abortions, or change the size of the TANF caseload. The Effects of Welfare Policy and the Economic Expansion on Welfare Caseloads: An Update.
What GAO Found

To reduce out-of-wedlock pregnancies among welfare recipients, some states have imposed family caps on welfare benefits. One factor that determines the amount of cash benefits a family receives is the family's size--larger families receive more benefits. In states with a family cap policy, however, no additional cash benefits are provided with the birth of another. Twenty-three states have implemented some variation of a family cap, breaking the traditional link between a family's size and the amount of its monthly welfare check. Generally, these states implemented family cap policies as part of their welfare reforms to reduce out-of-wedlock births and to encourage self-sufficiency. During an average month in 2000, 20 of the 23 family cap states reported that about 108,000 families received less in cash benefits than they would have in the absence of state-imposed family cap policies. In an average month, about nine percent of welfare families in these states had their benefits affected by the family cap. A family's welfare benefits are affected by several factors, including earnings and receipt of child support. Therefore, states were unable to report the precise effect of the family cap on benefits. Because of limitations of the existing research, GAO cannot conclude that family cap policies reduce the incidence of out-of-wedlock births, affect the number of abortions, or change the size of the welfare caseload.