RD133 - Annual Report on Projects Funded with the Temporary Assistance for Needy Families Block Grant


Executive Summary:
The federal Temporary Assistance for Needy Families (TANF) block grant funds a host of important and effective programs throughout the Commonwealth including the Virginia Independence Program (VIP). The VIP consists of two related but distinct sets of requirements for TANF participants, eligibility requirements and work requirements. The policies that mandate eligibility requirements became effective statewide on July 1, 1995. The Virginia Initiative for Employment not Welfare Program (VIEW) is the work-related portion of VIP that requires participants to be employed or engaged in a work activity. Implementation of VIEW was phased in over a two-year period beginning in July 1995, and ending in October 1997.

Since VIP was implemented in July 1995, the TANF caseload has dropped from 70,797 to approximately 35,500 in June 2004, a 50 percent decrease. Of the 92,060 TANF recipients enrolled in VIEW since 1995, more than 67,000 found employment and joined the work force by June 2004. This caseload decline contributed to a net savings in federal and state funds of over $550 million.

Virginia has received four high performance bonuses totaling $31.6 million in TANF funds from the U.S. Department of Health & Human Services. The bonuses were received for four fiscal years - $7.9 for 1999 and the same amount for each year 2001-2003. Virginia ranked tenth in the nation in the job-entry category in 1999, ninth in 2001, fourth in 2002 and seventh in 2003. Virginia received over $6,300,000 for its efforts in job-entry in 2003. Another $1,500,000 was awarded for improvement in job retention and wage advancement.

Along with the unknown circumstances of federal legislation, the Commonwealth faced the significant barrier in state fiscal year (SFY) 04 of an unbalanced TANF budget. Virginia receives a yearly block grant of slightly more than $158 million. Unspent amounts remain in reserve for the Commonwealth for future years. In the initial stages of the block grant, Virginia developed a considerable surplus of funds attributed to the precipitous decline in TANF caseloads. Programs were then funded with the surplus amount. To balance the TANF budget for SFY 05, $34 million needed to be cut from TANF spending. Mandatory programs were funded such as TANF cash assistance, the VIEW (including funds for hard-to-serve services) and the statutory rape awareness program. In addition, certain other programs were funded either at no reduction or at a 10 percent reduction. A competitive grant process was initiated for the remaining TANF funded programs.

TANF was originally authorized by Congress through September 30, 2002. A reauthorization bill has not, as yet, been passed by Congress. Currently, TANF is operating under a continuing resolution through September 30, 2005. When reauthorization does occur, the program requirements could change. Regardless of the outcome of federal legislation, Virginia has an opportunity to create a more efficient and effective service delivery system by building upon past successes and taking advantage of the flexibility afforded by the block grant.