Over the summer, The Imprint Weekly Podcast went in-depth on a proposed rule made by the Biden administration that would put some new guidelines in place for states on the use of Temporary Assistance for Needy Families (TANF), the multibillion block grant that replaced the federal welfare program in 1996 and conditions support to the pursuit of employment.
Today the administration announced that after receiving more than 7,000 public comments about the proposal, it was going to withdraw it instead of moving forward to finalization. It’s worth noting that finalizing something this late in the game might have been frozen and rolled back by the Trump administration anyway.
“The Department has determined that it could benefit from additional public input and consideration on a set of issues relating to allowable TANF spending before adopting a final rule,” the administration noted in an announcement published in the Federal Register. “With the time left in this Administration, the Department is focusing on other matters” related to TANF.
“We are disappointed that the proposed TANF rule did not become law, but are hopeful that lawmakers will continue promoting policies to help TANF cash assistance reach the families who need it,” said Ashley Burnside, senior policy analyst with the Public Benefits Justice Team at the Center for Law and Social Policy.
In the early days TANF was mostly spent by states on basic income assistance to struggling households, but that quickly shrunk as a spending priority in favor of government services loosely categorized as supporting families.
The rule would have set a ceiling on the definition of the term “needy” in terms of TANF eligibility, in an effort to concentrate the program’s expenditures on the poorest households in each state. It also made several clarifications about what is allowable for states to do with their money, including that the use of TANF for child welfare services had to be for an effort to keep a family together. Costs related to the time a child spends in foster care would have been out, with the very notable exception of supporting relatives to care for children who had been removed by CPS.
States spend 9% of their TANF funds on child welfare, according to 2022 data compiled by the Center on Budget and Policy Priorities. But several states, including Arizona (73%) and Georgia (57%), have come to use the majority of their TANF funding to pay for child welfare services.
There is some indication that TANF reform could be taken up by Congress in the coming year. In September, the House Ways and Means Committee held a hearing entitled “States’ Misuse of Welfare Funds Leaves Poor Families Behind,” and a slew of bills aimed at TANF reform were introduced in 2024. Most of them were referred to the Ways and Means Subcommittee on Work and Welfare at the end of the year.
The Biden-proposed rule would have “highlighted many aspects of TANF that need reform, especially how little funding goes towards the program’s basic purposes,” said Nick Gwyn, interim senior director and advisor on income security policy for the Center on Budget and Policy Priorities. Gwyn also said the center was “disheartened” to see some House Republicans calling for including TANF in potential spending cuts. TANF has received around $16 billion per year since the 1990s, losing half of its real value to inflation.