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Children and Families

The federal welfare reform law, PRWORA (Personal Responsibility and Work Opportunity Reconciliation Act) was signed into law in August 1996, while Maryland passed significant welfare reform legislation during the 1996 Session. Maryland receives an annual block grant of $229.1 million from the Federal government for welfare reform activities.

 

·        There is a 5-year, 60-month cumulative lifetime limit on the receipt of cash assistance for families headed by an adult parent, with some exceptions to the time limit.

·        Since welfare reform was inaugurated, there has been almost a 74% drop in the caseload.

·        Children now comprise nearly three-quarters (75%) of the caseload.

Current Services

·        Customers apply for cash assistance (Temporary Cash Assistance — TCA) and other benefits, with receipt of the benefits based on various eligibility rules.

·        To receive TCA, adults must cooperate with Child Support and are screened for substance abuse and domestic violence issues.

·        Requirements for cash assistance include the adult participating in work activities for 40 hours per week.

·        A family sanctioned because of not following the work rules loses all cash assistance.

·        The maximum monthly TCA cash grant for a family of three is $490.

·        When $399 worth of Food Stamps is added to the TCA grant, the total family income is $889 per month, $628 below Maryland’s Minimum Living Level of $1,517 per month for a family of 3.

·        Adults in families leaving welfare for work are eligible for 1-year of Transitional Medical Assistance; afterwards children in the household are likely eligible for MCHP, the State’s health insurance program for children in households with income up to 300% of the FPL ($48,270 a year for a family of three). Some households pay a
monthly premium.

·        When a family moves from welfare to work they may be eligible for other benefits, such as Food Stamps and child care vouchers.

Gaps and Challenges

• Families trying to move from welfare to work — and following all the rules — are barely able to make ends meet and provide for their basic needs.
  • The maximum TCA monthly cash benefit for a family of three is $490. When the Food Stamp benefit of $399 is added, the total benefit is $889 falls to 58.6% of Maryland’s Minimum Living Level (MLL). The law calls for the total of TCA and Food Stamps to equal 61% of the MLL.
  • Maryland must meet the letter of the law and provide funds to assure that the cash grant and Food Stamp benefit equal — at minimum — 61% of the State’s MLL.  In FY ‘06 it would take an additional $8.6 million to meet the statutory benefit standard.

• Families remaining on welfare face significant challenges to finding and retaining employment.

o       The law requires that families receive substantive assessments to determine their strengths and barriers.

o       Additional services such a literacy programs, substance abuse treatment, mental health services, job coaching, supportive employment and retention strategies are needed to help even more families exit welfare.

• Many families who have left welfare have found employment, although in low-wage jobs.

o       Strategies must be developed to help more families retain employment, climb a career ladder and increase their income.

o       Examples to help families increase their income and accumulate assets include the EITC, the Earned Income Disregard, and the Child and Dependent Care Tax Credit.

• After leaving cash assistance, the use of work supports — such as Food Stamps, Child Care vouchers, and Medical Assistance — declines.

o       Cross-training among local agencies (housing, health, social services, workforce investment boards, etc.) as well as community-based organizations will help a wide range of staff better understand an array of potential benefits — many of which would bring federal dollars into the State’s economy.

o       More must be done to assure families receive all benefits to which they are eligible to help reduce the chance of recidivism.

• During the 2003 legislative session the Dedicated Purpose Account for welfare was drained from $12 million to “0”. In FY ‘02 there was about $80 million in the fund. These funds were intended to assure a viable program that will meet the needs of very low or no-income families with children.
• Families trying to leave welfare for work or who have found employment lead very fragile lives.

o       There must be greater emphasis on healthcare for adults, safe, accessible and affordable housing opportunities, sufficient child care vouchers, and transportation options. These are essential elements for families to meet their basic human needs.

• Non-custodial parents, as appropriate, should be an integral part of the family. Expanding Fatherhood programs, Family Initiatives and addressing child support burdens for lower-income obligors will help promote this policy.

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