Using Participation to Promote Welfare Reform Goals

 

By Nanette Relave

 

Background

 

The Personal Responsibility and Work Opportunity Reconciliation Act of 1996 (PRWORA) strengthened requirements for participation in work-related activities. These participation requirements have played a major role in welfare reform by giving federal direction to state and local activities, orienting welfare systems toward work-focused policies and services, fostering organizational culture change, and influencing the behavior of Temporary Assistance for Needy Families (TANF) applicants and recipients.

 

As welfare reform has unfolded, concerns about participation requirements have emerged. Some stakeholders are concerned the requirements have reduced access to education and training. Others fear not enough TANF recipients are participating in activities that count toward federal participation requirements. The debate on TANF reauthorization has brought such concerns to the forefront.

 

PRWORA established participation rates¾one for all families and another for two-parent families¾that states must meet or face a reduction in their TANF block grant. The current all-families rate is 50 percent and the current two-parent rate is 90 percent. To count toward these federal rates, TANF recipients must spend a minimum number of hours per week in one or more allowable activities. However, a caseload reduction credit that lowers participation rates has lessened the impact of the federal requirements. More information on participation requirements is available from the Welfare Information Network at http://www.financeprojectinfo.org/win/work.asp.

 

In fiscal 2001, all 50 states, the District of Columbia, and the commonwealth of Puerto Rico met the 2001 all-families rate and 30 of the 35 jurisdictions subject to the two-parent rate met that rate. The average all-families participation rate in 2001 was 34.4 percent. This statistic masks the considerable variation among states, with rates (including waivers that met federal requirements) ranging from 6.6 percent to 80.7 percent. Data on federal requirements do not reflect the full extent of participation, because some participants do not meet the hourly requirements or are in activities allowed by the state but not counted in the federal rates. The U.S. General Accounting Office (2002), using state-defined participation rates, found that nationwide about 56 percent of TANF adults were involved in work or related activities based on the 47 states that provided data for fall 2001 to the General Accounting Office. 

 

With the current focus on participation and the potential for stronger participation requirements following TANF reauthorization, states and localities may be reviewing their participation rates and policies. This Issue Note provides guidance on assessing participation rates and requirements. It also describes strategies that agencies serving TANF recipients can use to increase participation in program activities, regardless of their approach to welfare reform.

Policy and Program Issues

 

Should a state or locality take steps to increase the rate of participation? In thinking about whether to take steps to increase participation, states and localities should evaluate their current efforts against federal requirements and state and local requirements and goals. PRWORA strengthened the participation requirements that states must meet to avoid financial penalties, so federal requirements are an important benchmark. However, the caseload reduction credit has enabled states to meet the federal requirements with lower effective participation rates.

 

State and local participation requirements and goals are also important benchmarks. Some states have higher participation goals than the 50-percent federal participation requirement for all families. For all states and localities, satisfaction with their progress on welfare reform, including client well-being, is another consideration. For example, a state with low effective participation, even though meeting the federal requirement, may be missing an opportunity to engage nonparticipating TANF recipients in activities that enhance employability.

 

Although participation is not singularly an end goal of welfare reform, participation can help states and localities achieve goals such as increased employment, especially if program activities are well designed and administered for the target populations. Increased participation requirements can help communicate a welfare program’s message to clients and can induce more job-ready clients to seek employment. Through increased participation, welfare programs can engage clients who would not otherwise choose to participate in employment-building activities. Increased client participation in work and related activities can also generate public support for welfare reform efforts.

 

Time limits and future federal participation requirements are other factors to take into account. Time limits heighten the need to engage clients, including those with barriers to employment, in activities that promote self-sufficiency, or states risk terminating benefits to clients who have not received adequate services. Although TANF reauthorization is still being debated, states and localities could face more stringent federal participation requirements. Planning for increased participation could help states and localities prepare for this possibility.

 

What should a state or locality consider when defining participation and identifying the populations and activities to be included? Defining participation includes making decisions about issues such as who will count as a participant, what program activities will be allowed, when must clients begin participating, and for how many hours must they participate. PRWORA provides some guidance by laying out who and what will count toward federal participation requirements. To avoid a financial penalty, states and localities are well advised to take this federal direction into account. However, states and localities have flexibility within the federal framework, and caseload reductions have enhanced this flexibility by lowering participation rates through the caseload reduction credit. States may, for example, allow additional activities to count toward state participation or may exempt additional categories of recipients from participation.

 

Although the federal law is a key consideration in defining participation, several other factors are important. They include the goals and priorities of a state or locality’s TANF program, the composition of the caseload, and what is known about program activities. The goals and priorities of a state or locality’s welfare program in the current devolution environment can drive decisions on participation in different directions. If one goal is to enforce a reciprocal obligation on welfare recipients, a state could limit exemptions from participation and include work experience as a program activity. If a priority is skill development, a state could offer additional education and training activities to recipients. Caseload reduction, improved employability, child well-being, and universal engagement are other program goals that could influence decisionmaking on participation requirements.

 

Participation is more valuable for welfare clients and agencies if it helps promote employment and achieve other goals. When defining participation, it is important to consider the composition of the caseload and the research and practice knowledge about program activities. Caseload composition reflects the mix of applicants, current recipients, long-term recipients, those with barriers to employment, and others who comprise the caseload. Critical issues for effective participation include who is participating, what are clients doing in activities, and whether activities promote positive outcomes for clients. States and localities can draw on their own welfare reform experiences and on a large body of research to guide decisions about what activities will be effective with the populations in their caseloads (see Research Findings).

 

When defining participation, it is also important to take into account the limitations of participation. For example, 100-percent participation is not a feasible goal because some recipients will be unable to participate at any given time. Moreover, it can be costly to achieve high rates of participation, so participation should be weighed against other program goals and participation requirements should reinforce key program goals.

 

What challenges are states and localities likely to face in trying to increase participation? States and localities need to recognize that increasing participation poses many challenges.

 

• Fiscal constraints. Increasing participation takes resources to pay for staff time, program activities, support services, and other expenses. For example, the outreach, monitoring, followup, and other case management tasks needed to increase participation require a considerable staffing effort.
• Limited service capacity. Greater participation requires a service delivery system that can quickly accommodate clients in different program activities and provide needed support services. Some localities, particularly rural areas, have limited capacity to meet those needs.
• Client barriers to participation. In trying to increase participation, a state or locality is likely to reach deeper into the caseload and seek to engage clients who have not successfully participated in employment and other activities. These clients may require more labor- and resource-intensive strategies to involve them in activities. Even for clients with few or no barriers to participation, it can be challenging to get them to attend activities and motivate them to continue with those activities. Staff may spend considerable time following up with nonparticipants.
• Limited management information systems. An agency’s management information systems may have limited capacity to support the more intensive monitoring and tracking that case managers seeking to increase participation must do, particularly if clients are served by multiple agencies. Without good automated support, case managers face a greater burden in keeping abreast of client participation.

 

What strategies can help state and localities increase program participation? States and localities can draw from various policy and program tools to improve participation. Some key strategies for increasing program participation are highlighted below. For more information, see Gayle Hamilton and Susan Scrivener, Promoting Participation: How to Increase Involvement in Welfare-to-Work Activities (New York, N.Y.: Manpower Demonstration Research Corporation, September 1999), at

http://www.mdrc.org/Reports99/promoting_participation/PromotingParticipation.pdf.

 

• Increase outreach. Getting clients in the door is an important first step, even for clients who are mandated to participate in work or related activities. Program staff must actively reach out to new participants. They also should pay careful attention to initial attendance and follow up with nonparticipants.
• Increase monitoring and tracking. Programs that monitor participation moderately or intensively have greater participation impacts than programs with low levels of monitoring, according to the research. Staff will need adequate time and resources, such as automated tracking systems, to monitor participation more carefully.
• Emphasize strong enforcement of participation. Strong enforcement programs lead to higher participation rates than weak enforcement programs. Strong enforcement programs strive to enroll most of the target population in the program, monitor participation moderately or closely, and enforce participation through sanctions and other means.
• Reduce down time between program activities. Periods of inactivity can cause participation to drop off. It is important to engage clients quickly in activities at the start and to limit gaps between activities. This strategy may require greater flexibility (e.g., open-entry and open-exit provisions) in the delivery of program activities.
• Provide support services. Support services such as child care and transportation assistance are critical for participation. It is also important to allocate enough resources for these supports.
• Communicate participation expectations. It is vital to communicate to clients early and often the expectations for their participation, the consequences of not participating, and the benefits to be gained through program participation. The importance of participation should also be communicated to staff and vendors.
• Value participation in the agency. The welfare agency should make participation a program priority and incorporate outreach and monitoring into its work. The agency should also aim for the organizational culture to reflect the value placed on participation and reward superior performance.
• Provide incentives for participation. Incentives that make work pay, such as earned income disregards, improve participation in employment. Incentives such as personal recognition, gift certificates, and cash bonuses can help motivate continued participation.
• Offer different program activities. To increase participation, state and local agencies may want to offer various activities that promote employability. It is important to take into account the composition of the caseload. With hard-to-serve clients, for example, an agency may want to provide barrier removal activities, alone or in conjunction with work-related activities, though barrier removal activities may not meet federal participation requirements. States and localities may also want or need to expand work-based activities, such as work experience, transitional jobs, and on-the-job training.
• Develop strategies for hard-to-serve clients. Clients who have difficulty participating in work or other activities may need additional support or special activities to promote participation. Strategies could include specialized case management, barrier removal activities, and supported employment programs.
• Promote collaboration. Collaboration with service providers and other agencies can facilitate referrals, improve access to services, and promote client information sharing, which are all strategies to improve participation.

Research Findings

 

Participation requirements are among the best-studied elements of welfare reform programs. In particular, the National Evaluation of Welfare-to-Work Strategies (NEWWS) offers much research evidence on participation requirements. The NEWWS studies are available at http://aspe.hhs.gov/hsp/NEWWS/index.htm.  The research literature provides valuable information on the effects of requiring participation and on the effects of different program approaches that are tied to participation requirements.

 

Using NEWWS data to assess the effects of participation mandates, researchers found that requirements to participate in welfare-to-work programs can increase employment and earnings and reduce welfare income, independent of actual participation in the welfare-to-work program. Larger effects were found for more job-ready welfare recipients and for programs operating in healthier labor markets. Researchers also found that the probability of a response to a mandate increases with the strength of enforcement and the level of penalties for noncompliance. For more information, see Jean Tansey Knab et al., Do Mandates Matter? The Effects of a Mandate to Enter a Welfare-to-Work Program (New York, N.Y.: Manpower Demonstration Research Corporation, November 2000), at http://www.mdrc.org/Reports2001/NEWWS-IMtoJOBS/NEWWS-IMtoJOBS.htm.  Mandatory

employment services programs that established a participation quid pro quo for the receipt of welfare benefits consistently reduced welfare dependency, regardless of program strategy¾job search first, education first, or a mixed strategy. For more information, see Gordon L. Berlin, What Works in Welfare Reform: Evidence and Lessons to Guide TANF Reauthorization (New York, N.Y.: Manpower Demonstration Research Corporation, June 2002), at

http://www.mdrc.org/Reports2002/TANF/TANF-Introduction.htm.

 

Comparisons of different program approaches have found that employment-focused programs such as those providing job search first had larger effects on employment and earnings than did education-focused programs. The employment-focused approach was less expensive to operate and its impacts held even for those never graduating from high school. However, the most effective programs use a mixed-strategy approach that offers job search and short-term education or training as first activities. Effective programs also have a strong employment focus and emphasize good job development. For more information on these approaches, on findings for more disadvantaged clients, and on ways to improve program effectiveness, see Gayle Hamilton, Moving People from Welfare to Work: Lessons from the National Evaluation of Welfare-to-Work Strategies (New York, N.Y.: Manpower Demonstration Research Corporation, July 2002), at http://www.mdrc.org/Reports2002/NEWWS_Synthesis/NEWWS_Synthesis.htm.

 

Less research evidence is available on work-based programs such as work experience and subsidized employment. Although many states and localities have not yet used work-based programs extensively, there could be greater interest in these programs among states and localities wanting or needing to increase participation, especially if labor markets are slack. Manpower Demonstration Research Corporation (MDRC) research on pre-TANF work experience programs found no employment and earnings increases, though work experience can promote other program goals, such as reinforcing a reciprocal obligation on welfare recipients [see MDRC research reviewed in Marie Cohen, Mandatory Work-Related Activities for Welfare Recipients: The Next Step in Welfare Reform (College Park, Md.: University of Maryland, School of Public Affairs, Welfare Reform Academy, October 2001), at http://www.welfareacademy.org/pubs/mandatorywork.pdf. A growing body of research suggests transitional jobs programs are promising for hard-to-serve clients; these programs provide paid work, greater supervision, and support services. For more information, see Gretchen Kirby et al., Transitional Jobs: Stepping Stones to Unsubsidized Employment (Princeton, N.J.: Mathematica Policy Research, Inc., April 2002), at

http://www.mathematica-mpr.com/PDFs/transitionalreport.pdf.

 

Innovative Practices

 

Participation is one of several key performance measures that drive the Alaska Division of Public Assistance (DPA) and its contractors to seek better outcomes for TANF clients. Case management and support services are seen as critical strategies for meeting participation requirements and other employment-oriented performance outcomes. Case management incorporates assessing employability, developing practical self-sufficiency plans, providing needed support services, and monitoring client activities and progress. As part of a work process reorganization, DPA has contracted out most TANF work services, including case management, to community-based organizations and workforce development agencies. Contractors and DPA staff use e-mail, site visits, case conferences, and an online case management system to communicate about client activities. To support intensive case management, DPA has outstationed a social worker at a contractor that serves a Native American population. DPA also makes needed support services available to promote participation and employment. For more information, contact Ron Kreher, Division of Public Assistance, Alaska Department of Health and Social Services, at 907-465-5843, or contact Craig Kahklen at 907-465-3347 for information on performance measures.

 

Through a combination of strategies, Illinois has achieved a rate of participation in work and related activities well beyond what federal requirements stipulate. In fiscal 2001, the state’s participation rate based on federal requirements was 65.8 percent. Illinois’ Work Pays program and “stopped clock” provision have helped increase the number of TANF recipients meeting participation requirements through employment. The Work Pays program creates a work incentive by disregarding two thirds of earned income when determining benefit levels. The “stopped clock” provision stops the time-limit clock for recipients who work 30 hours per week (35 hours per week for two-parent families) and still qualify for assistance. Although these strategies extend the time that working recipients might be on assistance, the state sees value in helping them achieve stability in the workforce as they move toward greater self-sufficiency. Other strategies to enhance participation include providing support services and colloborating with community-based service providers. For more information, contact the Illinois Department of Human Services, Bureau of Financial Support Policy, at 217-782-1239.

 

PRWORA lists activities that meet federal participation requirements, but the law gives states the flexibility to define the activities. Kansas has taken advantage of this flexibility to broadly define the activities that meet federal requirements, which enables the state to provide different activities within a work-oriented welfare reform model. Through collaboration, the state can offer barrier removal and skill development activities to TANF recipients. For example, a collaboration with regional alcohol and drug abuse centers has resulted in substance abuse specialists being collocated at welfare offices to provide assessment and treatment to recipients. In addition, the state has a waiver that permits unlimited job search and job-readiness activities, and these activities count toward meeting participation requirements. A new state policy will allow localities to work with private-sector employers to develop work experience positions to increase the hours of work participation. The state has also enhanced support services to facilitate participation. Especially with respect to child care, the state has improved services by increasing funding, promoting quality, improving Head Start, and establishing resource and referral agencies for all counties. For more information, visit the Kansas Department of Social and Rehabilitation Services’ web site at

http://www.srskansas.org/ees/ks_works.htm.

 

Flexibility regarding work-related activities is a key element of Tennessee’s participation requirements. A waiver allows the state to count a broader range of activities toward the work participation rate. This flexibility helps clients meet the state’s 40-hour participation requirement by combining different types of activities, such as work, education, life skills training, and barrier removal activities. The state developed the Family Services Counseling (FSC) program that uses masters-level social workers to assist clients with serious barriers to self-sufficiency. FSC clients can engage in barrier removal activities prior to or during employment or couple them with other activities. Tennessee has found accurate data on the activity status of program participants is vital to improving work participation rates. The state is developing an automated tracking system that, compared with the current system, will follow the progress of participants more easily and efficiently and enable case managers to identify individuals not meeting work requirements. For more information, contact Paul Lefkowitz, program planner, Tennessee Department of Human Services, at Paul.Lefkowitz@state.tn.us.

 

Washington designed its WorkFirst welfare reform program, including participation requirements, to meet federal requirements as well as outcomes the state desired. Helping individuals become self-sufficient is a key outcome for the state. In addition, several principles have shaped the WorkFirst program. These include the value of making work pay and the expectation that all clients will engage in work or other activities to move toward self-sufficiency. Washington developed the components of its welfare program to create viable opportunities for clients to meet participation expectations. For example, the state allows skills training activities and has a paid jobs program¾Community Jobs¾for clients who need to build employability skills.

 

Washington is also working to improve participation by developing excellent tracking and monitoring tools. Case managers use an automated system that enables them to track client activities, client progress, and individual responsibility plans. The system notifies the case manager two weeks before an activity is expiring. The state has extended the use of this system to contractors and community colleges. Washington also has a check-in system with its job search activity, which is often a client’s initial activity. This system helps the state track participation early on. For more information, visit the WorkFirst web site at http://www.workfirst.wa.gov/index.htm.

 

For More Information…

 

Resource Contacts

 

Center for Law and Social Policy, 202-906-8000 or http://www.clasp.org/.

 

Manpower Demonstration Research Corporation, 212-532-3200 or http://www.mdrc.org/.

 

National Governors Association, Center for Best Practices, 202-624-5300 or

http://www.nga.org/center/1,1188,,00.html.

 

U.S. Department of Health and Human Services, Administration for Children and Families, Office of Family Assistance, http://www.acf.hhs.gov/programs/ofa/. For participation rate data, visit http://www.acf.hhs.gov/programs/ofa/particip/indexparticip.htm.

 

U.S. General Accounting Office, Gale Harris, 202-512-7235.

 

Publications

 

Berlin, Gordon L. What Works in Welfare Reform: Evidence and Lessons to Guide TANF Reauthorization. New York, N.Y.: Manpower Demonstration Research Corporation, June 2002. Available at http://www.mdrc.org/Reports2002/TANF/TANF-Introduction.htm.

 

Cohen, Marie. Mandatory Work-Related Activities for Welfare Recipients: The Next Step in Welfare Reform. College Park, Md.: University of Maryland, School of Public Affairs, Welfare Reform Academy, October 2001. Available at http://www.welfareacademy.org/pubs/mandatorywork.pdf.

 

Greenberg, Mark, and Hedieh Rahmanou. TANF Participation in 2001. Washington, D.C.: Center for Law and Social Policy, March 2003. Available at

http://www.clasp.org/DMS/Documents/1048004065.37/2001_TANF_Participation.pdf.

 

Hamilton, Gayle. Moving People from Welfare to Work: Lessons from the National Evaluation of Welfare-to-Work Strategies. New York, N.Y.: Manpower Demonstration Research Corporation, July 2002. Available at http://www.mdrc.org/Reports2002/NEWWS_Synthesis/NEWWS_Synthesis.htm.

 

Hamilton, Gayle, and Susan Scrivener. Promoting Participation: How to Increase Involvement in Welfare-to-Work Activities. New York, N.Y.: Manpower Demonstration Research Corporation, September 1999. Available at

http://www.mdrc.org/Reports99/promoting_participation/PromotingParticipation.pdf.

 

Karoly, Lynn A. “Estimating the Effect of Work Requirements on Welfare Recipients: A Synthesis of the National Literature.” Testimony before the House Subcommittee on 21st-Century Competitiveness, October 16, 2001. Available at http://www.rand.org/publications/CT/CT185/CT185.pdf.

 

Kirby, Gretchen, Heather Hill, LaDonna Pavetti, Jon Jacobson, Michelle Derr, and Pamela Winston. Transitional Jobs: Stepping Stones to Unsubsidized Employment. Princeton, N.J.: Mathematica Policy Research, Inc., April 2002. Available at http://www.mathematica-mpr.com/PDFs/transitionalreport.pdf.

 

Knab, Jean Tansey, Johannes M. Bos, Daniel Friedlander, and Joanna W. Weissman. Do Mandates Matter? The Effects of a Mandate to Enter a Welfare-to-Work Program. New York, N.Y.: Manpower Demonstration Research Corporation, November 2000. Available at

http://www.mdrc.org/Reports2001/NEWWS-IMtoJOBS/NEWWS-IMtoJOBS.htm.

 

Turner, Jason. “Universal Engagement” of TANF Recipients: The Lessons of New York City. Washington, D.C.: The Heritage Foundation, May 2003. Available at http://www.heritage.org/research/welfare/bg1651.cfm.

 

U.S. General Accounting Office. Welfare Reform: Assessing the Effectiveness of Various Welfare-to-Work Approaches. GAO/HEHS-99-179. Washington, D.C., September 1999. Available at http://www.gao.gov/archive/1999/he99179.pdf.

 

U.S. General Accounting Office. Welfare Reform: Moving Hard-to-Employ Recipients into the Workforce. GAO-01-368. Washington, D.C., March 2001. Available at

http://www.gao.gov/new.items/d01368.pdf.

 

U.S. General Accounting Office. Welfare Reform: With TANF Flexibility, States Vary in How They Implement Work Requirements and Time Limits. GAO-02-770. Washington, D.C., July 2002. Available at http://www.gao.gov/new.items/d02770.pdf.

 

U.S. General Accounting Office. Welfare Reform: Work-Site-Based Activities Can Play an Important Role in TANF Programs. GAO/HEHS-00-122. Washington, D.C., July 2000. Available at http://www.gao.gov/new.items/he00122.pdf.

The Welfare Information Network is supported by grants form the Annie E. Casey Foundation, the Charles Stewart Mott Foundation, the David and Lucile Packard Foundation, the William and Flora Hewlett Foundation and the Ford Foundation