RD223 - Virginia Independence Program and Other Projects Funded with the Temporary Assistance for Needy Families Block Grant for State Fiscal Year 2009


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 of 1995, the TANF caseload has dropped from 70,797 to 34,792 in June 2009, a 51% decrease. While the caseload declined from 1995, during State Fiscal Year (SFY) 09, the caseload increased by 15%. Of the 164,905 TANF recipients enrolled in VIEW since 1995, almost 116,000 found employment and joined the work force by June of 2009. This caseload decline contributed to a net savings in federal and state funds of over $1.23 billion.

Item 338 of the Act provides for a spending strategy designed to protect families at risk and facilitate the transition to economic self-sufficiency. Federal TANF funds are being used to finance these strategies through the funding of numerous projects designed to help low-income families to gain and keep employment leading to the elimination of public assistance.

TANF was originally authorized by Congress through September 30, 2002. Reauthorization of TANF was included in the Deficit Reduction Act of 2005 (Pub. L. No. 109-171) and new regulations took effect on October 1, 2006. The Commonwealth reacted by instituting a number of changes aimed at increasing the number of TANF recipients participating in employment and training activities. Changes due to reauthorization have been fully implemented and have resulted in increasing the Commonwealth’s TANF work participation rate from 28% in September of 2006 to 49% by June of 2008. However, the recession that started in December of 2007 has had a negative impact on both the size of the TANF caseload and the number of TANF recipients that are employed. The caseload increased 15% during SFY 09. There was also a modest decline in the work participation rate to 48%. The recession will continue to present challenges with higher caseloads, more applicants, greater demand for services, and fewer employment opportunities.