RELEASE: October 29, 2001

Previous Screen

To the Editor:

Today, nearly five years after former President Clinton signed welfare reform into law, New Jersey faces two serious challenges.

The more imminent challenge we face is the five-year time limit on federal welfare benefits, which arrives in April 2002 for about 1,900 adults statewide. Second, and perhaps more importantly in the long run, we must begin convincing the U.S. Congress to renew the Temporary Assistance to Needy Families (TANF) program.

As chairman of the state Board of Human Services -- which advises the Commissioner of Human Services on policy and planning issues, including welfare reform -- I have seen first-hand how the funding and flexibility afforded by TANF helped New Jersey better serve welfare families and the working poor.

New Jersey's TANF program, known as Work First New Jersey, enjoyed great success in moving people from welfare to work. The welfare caseload dropped more than 50 percent, from 96,500 families in April 1997 to about 42,000 families this month (July 01). This historic reduction led to a shift in funding priorities.

Six years ago, the Department of Human Services, Division of Family Development (DFD) devoted nearly 75 percent of its welfare spending to cash benefits. This year, DFD budgeted only 20 percent of welfare funds for cash benefits.

But while spending on benefits declined, overall spending has increased. This is because the state diverted more resources toward job search, training, education, substance abuse and mental health programs for the people remaining on welfare. In addition, DFD now serves more working families than ever before -- regardless of whether those families ever received welfare.

DFD will spend more than $550 million this year on support for the working poor, including programs such as subsidized child care, rental assistance, transportation, and a state Earned Income Tax Credit. The division also offers grants of $4,000 for education or job training to people who left welfare for work so that they can find new jobs or advance in their current careers.

Surveys conducted by an independent researcher, Mathematica Policy Research Inc., show that people who left welfare for work are faring much better financially and spiritually than those who remain on public assistance.

We cannot deny that life for some families remains a struggle. But Mathematica's research, documenting the lives of 2,000 people who were on welfare three years ago, shows that people who left welfare for work saw their monthly earnings rise 17 percent between 1999 and 2000, from $1,084 to $1,271. In contrast, a family of three on Temporary Assistance to Needy Families (TANF) collects $424 per month.

People who leave welfare for work receive various support services, including transportation grants, Medicaid health coverage for their children, and subsidized child care. In addition, families earning less than 130 percent of the federal poverty level -- $1,585 per month for a family of three -- remain eligible for Food Stamps.

About 29,000 adults remain on Work First NJ, including the 1,900 who may reach the five-year benefits limit next April. That number has been dropping steadily for the past several months, and one could expect that it will continue to drop.

Obviously, some people will reach that five-year limit. But the state has always pledged that people will not be simply dropped from the rolls en masse. The federal welfare reform law allows DFD to grant time extensions and exemptions for some people, and that will be considered. Eligibility criteria are still being determined.

The county welfare agencies are conducting comprehensive assessments of everyone who has been on Work First for 34 months or more. These assessments yield a clear picture of the strengths and weaknesses of every individual, allowing the state to do everything it can to prepare that person for work or identify a more appropriate support program.

I remain convinced that the state will meet the challenges posed by the five-year time limit. But we need the federal government to reauthorize TANF, at its current funding levels, so the state can continue serving a wider constituency of working poor families.

Work First NJ helped move thousands of families from welfare to financial independence. We know that the lives of people who left welfare are not necessarily easy. Many of them remain poor, especially in a high cost-of-living area like New Jersey.

But welfare reform gave these families that first leg up. The next step will be to help more and more of those newly working people rise out of poverty altogether.

Richard Strobel
Chairman
State Board of Human Services

The State Board consults with, and advises, the Commissioner on the administration of the Department of Human Services, including its institutions and agencies. The Board also conducts long-range planning and policy studies.