Fifth Annual Report to Congress (February 2003)

An additional central objective of TANF is to "prevent and reduce the incidence of out-of-wedlock pregnancies and establish annual numerical goals for preventing and reducing the incidence of these pregnancies."

The TANF statute requires the Department to rank States based on a ratio of the total number of out-of-wedlock births in TANF families to the total number of births in TANF families and to show the net changes in the ratios between the current year and the previous year. (See Table 8:1 for FY 2001 data and net changes between FY 2000 and FY 2001.)

States were required to report data on out-of-wedlock births in TANF families for the first time in 2001 for the period FY 2000. Some States had difficulty in reporting, and some State data may have been incomplete or inaccurate. Many of these data issues have since been resolved. Currently, the Department does not have enough information to analyze thoroughly these data or identify State trends.

Also as provided in the TANF statute, the Department awards a "Bonus to Reward Decrease in Illegitimacy Ratio" to as many as five States (and three Territories, if eligible) that achieve the largest decrease in out-of-wedlock births without experiencing an increase in their abortion rates above 1995 levels.

The Administration for Children and Families issued final regulations on this bonus provision on April 14, 1999, implementing section 403(a)(2) of the Social Security Act. As specified in the statute, up to $100 million annually is available in each of fiscal years 1999 through 2002. Potentially eligible States include the 50 States of the United States, the District of Columbia, the Commonwealth of Puerto Rico, Guam, the United States Virgin Islands, and American Samoa. The amount of any award for Guam, the Virgin Islands, and American Samoa will be 25 percent of their mandatory TANF ceiling amount. The remainder of the $100 million will be divided equally among the other eligible States up to a maximum of $25 million for each eligible recipient.

Bonuses are awarded as follows:

• The ratio of out-of-wedlock births to total births is calculated for each State for the most recent two-year period for which data are available and for the prior two-year period. To compute these ratios, HHS uses the vital statistics data compiled annually by the National Center for Health Statistics, based on records submitted by the States.
• The five States that had the largest proportionate decrease in their ratios between the most recent two-year period for which data are available and the prior two-year period are identified. These States are potentially eligible.
• If Guam, the Virgin Islands, and American Samoa had a comparable decrease in their ratios (i.e., a decrease at least as large as the smallest decrease among the other qualifying States or a decrease that ranks among the top five decreases when all States and Territories are ranked together), they are potentially eligible.
• The potentially eligible States and Territories are notified that, to be considered for the bonus, they need to submit data on the number of abortions performed in their jurisdiction for the most recent year and for 1995.
• HHS determines which of the potentially eligible States and Territories also experienced a decrease in their rate of abortions (defined for the purposes of this bonus to be the ratio of abortions to live births) for the most recent calendar year compared to 1995, the base year specified in the Act. These States and Territories will receive a bonus award.
• While the criteria for determining bonus eligibility for Guam, the United States Virgin Islands, and American Samoa are the same as for the States, their eligibility is determined separately and their bonus amount is different, as specified in the statute, i.e., sections 403(a)(2)(B)(ii) (Amount of Grant) and 403(a)(2)(C)(i)(I) (Definition of Eligible State).

In 1999 and 2000, five States were awarded a bonus. In 2001, only three States received a bonus. In 2002, six jurisdictions received a bonus: Alabama, Colorado, District of Columbia, Michigan, Texas, and the Virgin Islands. (Tables 8:5 through 8:8 contain the information on which these awards were based.)

The National Center for Health Statistics (NCHS) at the Centers for Disease Control and Prevention in HHS is responsible for collecting and analyzing vital statistics data. Based on preliminary numbers of births for 2001, NCHS data show that the birth rate for unmarried women aged 15-44 years declined slightly in 2001 to 44.9 births per 1,000 women, compared with 45.2 in 2000. The preliminary 2001 birth rate is still four percent below the 1994 peak (46.9). The proportion of all births that were out-of-wedlock rose to 33.4 percent in 2001, compared with 33.2 in 2000. Since 1994, the proportion has changed very little, ranging from 32.2 to 33.4 percent (Tables 8:2 through 8:4). After several decades of sharp increases, non-marital childbearing leveled off during the second half of the 1990s and 2000-2001.