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1992.07.20 :  New Jersey Welfare Reform Demonstration

Contact: Larry Dye (202) 401-9215
July 20, 1992

       HHS Secretary Louis W. Sullivan, M.D., today announced
approval for New Jersey's Family Development Program, which will
make reforms in the state's welfare program to reward work and
encourage family formation.
       "The New Jersey initiative is one more new approach to try
to strengthen families and promote family self-sufficiency,"
Secretary Sullivan said.  "We continue to encourage states to try
innovations in their welfare programs, so that the AFDC system
can become more effective in reducing welfare dependency."  
       Under New Jersey's program, families will be able to
retain more of their earnings when they go to work, while still
receiving Aid to Families with Dependent Children benefits.  To
promote family formation, AFDC benefit rules will also be changed
regarding the treatment of stepparent income.
       Following a 10-month grace period, cash assistance will
not be increased for families who have additional children while
on welfare.  The program will also require participation by AFDC
parents whose youngest child is 2 years of age and over in
educational, employment-directed activities or employment.
       "With the President's encouragement, many states are
proposing innovations and improvements in their welfare
programs," said Jo Anne B. Barnhart, HHS assistant secretary for
children and families.  

"We will continue to review these proposals on an expedited basis
so that new approaches in public assistance programs can be
developed and put into effect."
       Additionally, under the waiver provided to New Jersey:
     o    AFDC recipients whose youngest child is under 2 years
of age will be required to participate in vocational counseling
and assessment, and
     o    There will be a 24-month period of transitional
Medicaid benefits for those who leave AFDC due to employment,
rather than a 12-month transition period.
       The New Jersey program will begin Oct. 1 for a five-year
period.  The demonstration will be evaluated, based on an
experimental design, to determine its effectiveness.
       The AFDC program is administered by the states with joint
funding by the federal government.  Some changes proposed by
states require approval by HHS.


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