Center on Budget and Policy Priorities
October 9, 2018
By Ashley Burnside and Ife Floyd
Direct financial assistance for the nation’s poorest families with children fell again in purchasing power this year and is now at least 20 percent below its 1996 levels in 36 states, after adjusting for inflation. Although some states increased benefits during the past year, benefits are still too low for families relying solely on assistance from Temporary Assistance for Needy Families (TANF) to make ends meet.
For 99 percent of recipients nationally, the purchasing power of their benefits is below the level in 1996, when lawmakers passed the law that created the TANF block grant.[1] Living on such limited incomes risks exposing children to excessive levels of hardship and stress, which research shows can negatively affect their health and undermine their development, limiting their future economic and social mobility. To improve all children’s chances of succeeding over the long term, states should invest more TANF federal and state spending in direct financial assistance for families (cash assistance), halt the erosion of TANF benefits, and restore the purchasing power lost over the past 22 years.
Ten states plus the District of Columbia increased TANF benefits between July 2017 (the start of fiscal year 2018 in most states) and July 2018; six states enacted legislation or made administrative changes that will raise benefit levels after July 2018. No state cut benefits, but most states did not adjust benefits, allowing inflation to continue eroding the benefits’ value.
As of July 1, 2018, every state’s TANF benefits for a family of three with no other cash income were at or below 60 percent of the poverty line, measured by the Department of Health and Human Services’ (HHS) 2018 poverty guidelines. Most states’ benefits were below 30 percent of the poverty line. While benefits are below 60 percent of the poverty line for all TANF recipients, black families are disproportionately impacted by these low benefits, as they are more likely than white families to live in the states with the lowest benefits and that serve the fewest eligible families.
This paper, an annual update of state TANF benefit levels as of July 1, covers changes in TANF benefits between July 1, 2017 and July 1, 2018. The benefit levels cited here reflect the monthly benefits for a family of three with no other income as of July 1, 2018; they may exceed what many families actually receive because families often do not receive the maximum TANF benefit and family grants in seven states (California, Connecticut, Illinois, New York, Pennsylvania, Vermont, and Virginia) vary by geographic region.[2] Unless noted otherwise, this paper reports the benefit level in the state’s most populous region.
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