BOSTON – Senator John Kerry today sent a letter to Secretary of Health and Human Services (HHS) Michael Leavitt calling on him to reconsider his plan to potentially eliminate funding for Massachusetts’ Temporary Assistance for Needy Families (TANF) program.

Massachusetts is one of a dozen states that implements supplemental economic assistance to working families on TANF, which provides incentive for families to find – and keep – jobs. The program has resulted in millions of dollars in State funding that is dedicated to helping needy families.

“If this program is eliminated, Massachusetts stands to lose close to $109 million for its TANF program. It is irresponsible and cruel to eliminate a program that more than 45,000 Massachusetts families depend on to survive during these tough economic times. I strongly urge Secretary Leavitt and HHS to reconsider this plan. We need to be doing everything possible to help families make ends meet,” said Senator Kerry.

Kerry submitted the letter along with his colleagues Senator Max Baucus and Congressmen Charles Rangel and Jim McDermott.

The text of the letter is as follows:


The Honorable Michael O. Leavitt
Secretary
Department of Health and Human Services
Hubert H. Humphrey Building, Room 615F
200 Independence Avenue, SW
Washington, DC 20201

Dear Secretary Leavitt:

We are writing to express our deep concern regarding your agency=s proposed rule to eliminate a provision that permits States to receive additional caseload reduction credit for maintenance-of-effort (MOE) expenditures that are in excess of what is required under the Temporary Assistance for Needy Families (TANF) program. The proposed rule would eliminate the incentive that is currently provided to States to exceed their required MOE spending levels on services that are directed to children and families. This incentive has been helpful to New York, Montana, Washington State, Massachusetts and as many as 30 other States, and has resulted in millions of dollars in State funding that is dedicated to supporting needy families. If implemented, the proposed change could severely limit services for these families in the midst of an economic downturn B a time when these services are most needed. We are concerned about the detrimental impact of such a change on vulnerable families, and we strongly urge you not to move forward with this unnecessary, untimely, and counterproductive action.

The enhanced TANF MOE credit encourages States to invest their funds on services that help low-income families by rewarding them for spending above the required MOE level. States that spend above the required level receive a credit that can be used to reduce their required work participation rate. States spend additional MOE dollars to fund a variety of services that provide critical economic supports to TANF recipients, those who are transitioning off the program, and to other needy families.

The notice of proposed rulemaking that was published in the Federal Registry in August 8, 2008 argues that the elimination of the enhanced MOE credit is required because the credit is no longer necessary, is impractical, and is contrary to Congressional intent. We strongly disagree with this interpretation

First, the TANF program is comprised of a number of working poor families who continue to be in need of economic support to assist them in meeting their most basic needs. These families also require work supports to help them successfully transition into the workforce. As a result, States have invested considerable funds that exceed their required MOE spending levels to provide training and education services, State Earned Income Tax Credit payments, health programs, and transitional services to families leaving TANF. The enhanced MOE credit continues to be necessary to support these families. Moreover, the credit complements the statutory purposes of the TANF program, and serves as a vital source of assistance to other vulnerable families who are at-risk of entering the program.

Second, States are now facing considerable hardships due to the economic downturn facing our nation and are now less equipped to provide supports to these families. The enhanced MOE credit provides States with a strong incentive and justification to continue allocating scarce resources to supports for low-income families. Without the incentive provided by the credit, continued State spending on low-income families B the very families that have been hit the hardest by the deteriorating economy and who face rising food and energy costsB would be in jeopardy.

Finally, your proposal to eliminate the credit is inconsistent with Congressional intent. We are not aware of any discussions about the enhanced MOE credit during the TANF reauthorization process. Moreover, not one of the Congressional bills introduced that would have reauthorized the TANF program contained any language eliminating this credit. Thus, your suggestion that the provision is consistent with Congressional intent is contrary to our belief.

We therefore strongly urge you to immediately withdraw your proposal to eliminate the enhanced MOE credit. Feel free to contact us if you wish to discuss this matter. We look forward to hearing from you soon.

Sincerely,

Rep. Charles Rangel   
Chairman Committee on Ways and Means

Sen. Max Baucus   
Chairman Committee on Finance 

Rep. Jim McDermott 
Subcommittee Chairman Committee on Ways and Means Subcommittee on Income Security Security, And Family Support

Sen. John Kerry  
Subcommittee Chairman Committee on Finance 
Subcommittee on Social Pensions, and Family Policy

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