New Rule Opens Up TANF Money for Employment Training

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If you aren't watching what your state legislators and governor are doing with Temporary Assistance for Needy Families money (TANF), now is the time to get on it. The Administration for Children and Families, a division of the Department of Health and Human Services (HHS) issued a rule yesterday that spells out specifically what the Recovery Act allotted for: the relatively unrestricted use of unspent TANF funds.

Before the Recovery Act, TANF money remained with a state even if it went unspent in the year it was distributed ("carried over" money, in government speak). But there was a caveat: states could only spend those dollars on direct assistance and payments to needy families or support services for unemployed parents like child care or transportation.

Now, the restrictions have been lifted. A state can now use old TANF funds, the rule says, for "any allowable TANF benefit, service, or activity such as job skills training or re-training activities, employment counseling services, parental counseling services, teen pregnancy prevention activities, services for victims of domestic violence, after-school programs."

 How big a deal is that? Depending on what state you are in, it's either huge or not a big deal at all. Data from ACF indicates that about a dozen states spent all of their TANF money in fiscal 2007. Some states left only a couple million unobligated.

But a lot of states are carrying a pretty significant balance of TANF dollars. Six of them (Colo., Ga., Hawaii, Md., Ohio, Tenn.) posted more than $100 million in unobligated funds for 2007, and another eight (Ark., Ky., N.M., N.Y., Ore., S.C. and Utah) reported between $50 million and $100 million.

Until now, that  money could not be used a community-level venture at attempting to improve families and prevent the kind of situations that often lead to child welfare system involvement.

Whether any of that money gets into the hands of youth service providers is up to those providers and the people that lobby for them. It is not required of these states to spend the TANF reserves; the rule just means that if they want to, they can spend it on a wider array of things.

So between the thrift mentality that appropriately has beset most state finance leaders and the scores of other industries that could seek out these dollars, pressure almost certainly will need to be applied if that money is going to get to after-school programs, pregnancy prevention, family preservation or any other TANF-approved venture.