Supporting the Child Care and Workforce Development Needs of TANF Families

R E S E A R C H R E P O R T Supporting the Child Care and Workforce Development Needs of TANF Families Heather Hahn Gina Adams Shayne Spaulding Caroline Heller April 2016 A B O U T T H E U R B A N I N S TI T U T E The nonprofit Urban Institute is dedicated to elevating the debate on social and economic policy. For nearly five decades, Urban scholars have conducted research and offered evidence-based solutions that improve lives and strengthen communities across a rapidly urbanizing world. Their objective research helps expand opportunities for all, reduce hardship among the most vulnerable, and strengthen the effectiveness of the public sector. Copyright © April 2016. Urban Institute. Permission is granted for reproduction of this file, with attribution to the Urban Institute. Photo by Rich Pedroncelli/AP. Contents Acknowledgments iv Supporting the Child Care and Workforce Development Needs of TANF Families 1 Background 1 Understanding TANF and the Families It Serves 3 Child Care Subsidies for TANF Families: Use, Challenges, Opportunities, and Risks 7 Workforce Development for TANF Families: Use, Challenges, Opportunities, and Risks 21 Conclusions and Recommendations 30 Notes 35 References 36 About the Authors 40 Statement of Independence 41 IV A C K N O W L E D G M E N T S Acknowledgments This report was funded by the Annie E. Casey Foundation. We are grateful to them and to all our funders, who make it possible for Urban to advance its mission. The views expressed are those of the authors and should not be attributed to the Urban Institute, its trustees, or its funders. Funders do not determine research findings or the insights and recommendations of Urban experts. Further information on the Urban Institute’s funding principles is available at www.urban.org/support. We also extend our sincere appreciation to Patrick Hain of the Annie E. Casey Foundation for his support of this project. We appreciate the time and insights provided by David Bradley, Michelle Derr, Gene Falk, Olivia Golden, Christine Johnson-Staub, Pamela Loprest, Elizabeth Lower-Basch, Karen Lynch, Hannah Matthews, LaDonna Pavetti, and program leaders and administrators at HHS/ACF. We appreciate the additional efforts of Hannah Matthews and Peter Germanis, who also reviewed drafts. Supporting the Child Care and Workforce Development Needs of TANF Families Low-income families receiving cash assistance through Temporary Assistance for Needy Families (TANF) also need assistance with workforce development and child care. Workforce development and child care subsidy systems exist to support low-income families and individuals, but are TANF families well served by these systems? This report outlines the opportunities offered by workforce development and child care subsidy systems but also highlights the challenges of meeting the complex needs of these highly disadvantaged families and identifies implications for federal and state policy improvements. Background TANF is a flexible federal block grant to states for the broad purposes of providing assistance to needy families and reducing dependency on the government. While one of its main functions is to provide time-limited cash assistance to families—about 1.6 million very low-income US families with children receive small cash assistance payments averaging $378 per month—resources are also used to promote job preparation, work, and marriage, as well as other statutorily defined purposes. TANF adults are required to engage in work or work activities, with some exceptions and exemptions, making child care subsidies critical for supporting TANF parents’ employment as well as their children’s healthy development. Access to child care subsidies and workforce development services is also important in supporting parents and children as they transition off TANF. TANF time limits and work requirements, and the related demands for employment preparation and child care, situate TANF at the intersection of the workforce development and child care systems; however, the characteristics of TANF families accentuate the weaknesses in each system, making these families the most challenging for each system to serve. Program rules and realities, in combination with family characteristics, make it hard for TANF families to access intensive, high-quality services. TANF is positioned to meet the needs of both parents and children in mutually reinforcing ways, but both generations can succeed only if the supports are high-quality and intensive enough to meet those needs. 2 S U P P O R T I N G T H E C H I L D C A R E A N D W O R K F O R C E DE V E L O P M E NT N E E D S O F T A N F FA M I L I E S Recent reauthorizations and other developments in both the workforce and child care systems have implications for how those systems intersect with TANF, introducing new opportunities and new challenges. The Workforce Innovation and Opportunity Act (WIOA) reauthorized the workf