Summary
The debate over reauthorization of the Temporary Assistance for Needy Families (TANF) block grant has focused on work requirements and brought attention to the measure of TANF work participation. The measure is used to assess states' performance and determine whether a state is subject to penalty for not meeting TANF work requirements. The 2003 work participation rates ranged from 9 to 88 percent for the 50 states based on data they submit to the U.S. Department of Health and Human Services (HHS). To help Congress understand these rates, GAO looked at (1) how selected states are defining the categories of work activities, (2) whether selected states have implemented internal controls over the work participation data, and (3) what guidance and oversight HHS has provided states.
Differences in how states define the 12 categories of work that count toward meeting TANF work participation requirements have resulted in some states counting activities that other states do not count and, therefore, in an inconsistent measurement of work participation across states. For example, 5 of the 10 states we reviewed considered caring for a disabled household or family member to count toward the federal work participation requirement, while 5 did not consider hours spent in this activity to be countable. We also found that some states made significant changes in their definitions of the categories of work. As a result, the work participation rates for these states cannot be compared from year to year. Some of the states in our review have implemented internal controls to help report work participation hours in accordance with HHS guidance, while other states lack such internal controls. Some states have not issued guidance on how to verify that reported hours were actually worked, nor do they monitor data reported by their staff to help ensure that hours are reported correctly. In contrast, a few states have systematic approaches for verifying that hours reported were worked. HHS has provided limited oversight and guidance to states on appropriately defining work activities and reporting hours of work participation. According to HHS officials, HHS has the authority to regulate states' definitions of work activities. However, to promote state flexibility, HHS chose not to issue regulations for this purpose. Further, HHS's guidance lacks specific criteria for determining the appropriate hours to report. Given that HHS has not exercised oversight of states' definitions and internal controls, states are making different decisions about what to measure. Therefore, there is no standard basis for interpreting states' rates, and the rates cannot effectively be used to assess and compare states' performance.
Recommendations
Our recommendations from this work are listed below with a Contact for more information. Status will change
from "In process" to "Implemented" or "Not implemented" based on our follow up work.
Director:
Team:
Phone:
Kay E. Brown
Government Accountability Office: Education, Workforce, and Income Security
(415) 904-2272
Recommendations for Executive Action
Recommendation: HHS should issue regulations to specify the types of activities that can and cannot be included under the 12 categories of work activities.
Agency Affected: Department of Health and Human Services
Status: Implemented
Comments: The Deficit Reduction Act of 2005 (P.L. 109-171) reauthorized Temporary Assistance to Needy Families (TANF) and required the Secretary of the Department of Health and Human Services (HHS) to provide additional direction and oversight regarding how to count and verify allowable work activities. As a result, HHS issued an Interim Final Rule (Fed. Reg. vol. 71, No. 125, June 29, 2006 pp. 37454-37483) amending the TANF regulations to further define the 12 categories of work activities (45 CFR 261.2). In the preamble to the Interim Final Rule, HHS included a detailed discussion of the type of activities that can and cannot be included under the various categories.
Recommendation: HHS should issue regulations to have HHS oversee states' definitions of activities under the 12 categories.
Agency Affected: Department of Health and Human Services
Status: Implemented
Comments: The Deficit Reduction Act of 2005 (P.L. 109-171) reauthorized Temporary Assistance to Needy Families (TANF) and required the Secretary of the Department of Health and Human Services (HHS) to provide additional direction and oversight regarding how to count and verify allowable work activities. As a result, HHS issued an Interim Final Rule (Fed. Reg. vol. 71, No. 125, June 29, 2006, pp. 37454-37483) amending the TANF regulations to require states to submit a Work Verification Plan to HHS that will, among other things, include a description demonstrating how the activity meets the relevant definition of the activity in the regulations. The regulations also state that HHS will review states' Work Verification Plans to determine if they will result in accurate reporting of work participation information. (45 CFR 261.62)
Recommendation: HHS should issue regulations to set forth criteria for counting actual hours of activity and whether there are circumstances under which scheduled hours may be counted.
Agency Affected: Department of Health and Human Services
Status: Implemented
Comments: The Deficit Reduction Act of 2005 (P.L. 109-171) reauthorized Temporary Assistance to Needy Families (TANF) and required the Secretary of the Department of Health and Human Services (HHS) to provide additional direction and oversight regarding how to count and verify allowable work activities. As a result, HHS issued an Interim Final Rule (Fed. Reg. vol. 71, No. 125, June 29, 2006, pp. 37454-37483) amending the TANF regulations to specify that states must report actual hours, not scheduled hours, of activity (45 CFR 261.60).
Recommendation: HHS should develop and implement a plan for working with states to improve internal controls over work participation data. This plan could make use of existing resources and include steps such as (1) working through its regional offices to identify cost-effective internal controls being used by states, (2) using regional offices and existing sponsored conferences to share information with states on these internal controls and to emphasize the importance of internal controls, and (3) obtaining information from states about their experiences using the National Directory of New Hires to determine if it has potential for helping states collect more complete work participation data and if there are any useful practices to be shared with other states.
Agency Affected: Department of Health and Human Services
Status: In process
Comments: To implement the increased focus on state internal controls for TANF work rate data specified in the 2006 TANF reauthorization law, HHS issued interim final regulations in June 2006 that required each state to provide a work verification plan that includes a description of how the state will ensures its work participation data are reliable. These plans are to be approved by HHS and implemented by Sept. 30, 2007. Moreover, HHS now has authority to penalize states that fail to maintain adequate procedures for ensuring the accuracy of their work participation data. Our June 2007 review of the early implementation of TANF reauthorization in selected states found that HHS was reviewing state work verification plans and working with states to ensure they are in compliance.
