TANF Programs Currently Engage Recipients in a Limited Range of Work- related Activities

Our work has shown that over the years, states have engaged about one  third of families receiving TANF cash assistance in federally-defined work  activities nationwide while still meeting their required work participation  rates. Selected State and Local Programs Reflect Elements of Four Promising Approaches

		Research Indicates Several Promising Approaches for Increasing Employment and Earnings

A body of rigorous research points to four approaches that can be used to  increase the employment and earnings of TANF cash assistance  recipients: subsidized employment, treatment and employment services,  career pathways, and modified work-first.this research is based on programs that operated, at least in part, during  TANF’s predecessor program, AFDC, and have since ended; and some  of these older studies focused on programs that predominantly targeted  women. Career pathways – This approach has been defined in different  ways, but can involve providing contextual learning to prepare  individuals of various skill levels to advance in a high-demand  occupation or industry. Research shows that programs using this approach increased  employment and earnings and reduced welfare receipt. For example:
San Francisco’s Jobs Now! New York City WeCARE was designed to provide comprehensive  services to hard-to-employ clients with mental or physical health  needs or substance abuse problems. regarding how activities related to the career pathways approach may be  allowable under TANF rules could address misperceptions and  encourage more widespread use of this approach by state and local  TANF agencies. Expertise and Dedicated Funds Facilitated the Use of Promising Approaches, but the TANF Program Lacks Incentives for Wider Adoption or Testing

		The Selected Programs Benefitted from Partner Expertise and Dedicated Funding

Nearly all of the 10 programs we examined that currently use elements of  promising approaches drew on expertise beyond the state or local TANF  agency (see table 2). Nine of these programs involved partnerships with  organizations and agencies such as community college systems,  workforce agencies, and nonprofit organizations or contracted vendors. Officials said participation in technical  Decisions by state and local policymakers to dedicate funds for the  selected programs also facilitated the use of promising approaches,  according to program officials. However, some of these funds may have included federal TANF  funds that were being allocated by state and local entities. HHS’s authority over many aspects of TANF is  limited and it has not proposed legislative changes to address these  areas. Without federal action, adoption and evaluation of promising  approaches may continue to be limited to select states and localities,  leaving TANF recipients in other locations without access to these  promising approaches. As a result, any additional resources needed for  implementing more costly promising approaches for TANF cash  assistance clients may compete with other allowable uses of TANF funds. Conclusions

While the 10 state and local programs we examined are making use of  some promising approaches for moving TANF recipients into employment  and increasing their earnings, incentives are lacking for large numbers of  state and local TANF agencies to adopt and test such approaches under  the structure of the TANF program. TANF’s  goals include ending needy families’ dependence on government benefits  by promoting work. Yet, HHS, as the federal agency that oversees TANF, is  positioned to identify, suggest, and work in consultation with Congress on  potential changes that would address the lack of incentives for states to  adopt promising approaches. Recommendations for Executive Action

To encourage broader adoption and evaluation of promising approaches  and address impediments to the use of the career pathways approach  among TANF agencies, we recommend that HHS should take the  following two actions:  In consultation with Congress, identify potential changes that would  address the lack of incentives for states and localities to adopt  promising approaches and then develop and submit a legislative  proposal outlining those changes. HHS also agreed with our recommendation that the agency issue formal  guidance to clarify how the career pathways approach can be used by  TANF agencies. Appendix I: Objectives, Scope, and Methodology

Our report (1) reviews some approaches that have been identified as  holding promise to engage TANF recipients in employment and increase  their earnings and examines ways in which selected states and localities  have used them, and (2) identifies factors that influence the use of these  and other promising approaches. To first identify promising approaches, we reviewed research summaries  and syntheses of rigorous research on approaches for engaging TANF  recipients in employment and increasing their earnings. To identify state and local programs that are currently using these  approaches to serve TANF cash assistance recipients, we interviewed  cognizant researchers; officials from the Department of Health and  Human Services (HHS), the Department of Labor, and the Department of  Education; and others with TANF expertise. We assessed information and communication HHS  provides to states related to promising approaches against federal  internal control standards.
Why GAO Did This Study

The TANF block grant requires states to engage a certain percentage of work-eligible cash assistance recipients in specified work-related activities, such as job search assistance and training. Yet, data suggest that more TANF recipients could receive assistance that would help them gain employment and reduce their dependence. GAO was asked to provide examples of what some states are doing to achieve these goals and how to expand these efforts.
This report (1) reviews some approaches that have been identified as holding promise for engaging TANF recipients in employment and increasing their earnings and examines ways in which selected states and localities have used them, and (2) identifies factors that influence their use. To first identify promising approaches, GAO reviewed summaries and syntheses of rigorous research on approaches that increase employment and earnings, and profiled 10 state and local programs that were nominated by experts familiar with welfare research and state and local efforts, and that were selected to represent a range of approaches. GAO also reviewed relevant federal laws, regulations, and agency guidance, and interviewed agency officials and experts with a range of views.

What GAO Found

The 10 state and local programs GAO examined used various promising approaches to help Temporary Assistance for Needy Families (TANF) cash assistance recipients gain employment by meeting a range of participant needs. These approaches included the use of subsidized employment, employment alongside treatment for a health condition, and training for high-demand jobs. For example, for individuals in need of additional work experience, San Francisco's TANF program has provided subsidies to employers to place participants in temporary, wage-paying jobs. To help individuals with mental and physical disabilities and substance abuse problems, nonprofit contractors for New York City's TANF program have provided individualized assessment and treatment, often combined with employment. To prepare individuals with various skill levels for high-demand jobs, Minnesota and Washington have used a career pathways approach of combining occupation-specific training with basic skills education and support services. However, experts told us that some states have a misperception that this approach is not allowable under TANF rules, even though the Departments of Labor, Education, and Health and Human Services (HHS) support its use. HHS told us that states could still meet program requirements while using this approach, but the agency has not issued formal guidance clarifying this. Internal control standards for the federal government state that information should be communicated to managers in a form that enables them to carry out their responsibilities. As a result of these misperceptions, the career pathways approach may be underused by TANF agencies and TANF recipients could miss out on the potential benefits of this approach.
Expertise and dedicated funds facilitated use of these promising approaches, but the federal TANF program, itself, lacks incentives for their wider adoption. Of the 10 programs GAO examined, 9 drew on the expertise of partner organizations—including community college systems, workforce agencies, and nonprofits. The programs also benefitted from decisions by state and local policymakers to dedicate funds—including TANF funds—for the selected programs, according to officials. However, incentives for large numbers of state and local TANF agencies to adopt and test promising approaches are lacking under the structure of the TANF program for several reasons. First, many program design and funding choices are left to the states, and GAO's prior work has shown that state use of TANF funds for more costly welfare-to-work approaches can compete with other allowable uses of TANF funds. Second, TANF's main performance measure does not necessarily encourage agencies to use certain approaches that incorporate longer-term education and training or treatment services, although states are not prohibited from doing so. Third, little incentive exists for TANF agencies to evaluate their programs. HHS's authority over many aspects of TANF is limited and it has not proposed legislative changes to address these areas. Yet, because HHS oversees TANF, it is positioned to identify, suggest, and work in consultation with Congress on potential changes that would better address the lack of incentives for the use of promising approaches by states and to better meet the TANF goal of increasing employment. Without federal action, adoption and evaluation of promising approaches may continue to be limited to select states and localities, leaving TANF recipients in other locations without access to these promising approaches.

What GAO Recommends

GAO recommends that HHS should issue guidance to clarify how the career pathways approach can be used by TANF agencies and identify potential changes to address the lack of incentives in the TANF program. HHS agreed with GAO's recommendations.