Senate Welfare Reform Proposal

The Senate has released its comprehensive proposal to strengthen the state’s largest cash assistance program, Transitional Aid to Families with Dependent Children (TAFDC). We will vote on it later this week.

Here are the major components of the Senate’s proposal:

First, the bill requires analysis and reporting on some fundamental program issues that have not been addressed in the recent audits. TAFDC is designed to be temporary. It already includes work requirements and term limits. But TAFDC also allows exemptions from those requirements and limits — notably for parents of very young children. The bill requires DTA to develop and release better data showing how many of these exemptions are being allowed.

Second, it tightens the application process. It increases penalties for false representations and requires applicants to more promptly provide valid social security numbers.

Third, it strengthens work requirements. Working through the Commonwealth Corporation, it creates a “job diversion” program to move qualified applicants for assistance directly into jobs instead of onto welfare. It requires applicants to seek work before going on welfare and to continue their job search. The bill funds 50 employment specialists to focus on the recipients most at risk of continuing unemployment. It also gives businesses incentives to hire welfare recipients by covering their health insurance costs — these costs will be offset by savings in the MassHealth program which would otherwise cover health care for these recipients. It imposes more accountability for outcomes on job training and placement programs.

Finally, the bill includes a number of provisions designed to reduce fraud. These requirements will strengthen not only the TAFDC program but also the federally-funded SNAP program (formerly known as food stamps).SNAP benefits are lower than TAFDC benefits, but are available to many more households — 500,000 households, almost ten times as many. The problem of fraud is arguably greater in SNAP because it is only supposed to be used for food.  Some recipients work around that limit by converting the benefits into cash.

The bill requires that Electronic Benefit Transfer cards shall include photo identification of the card holder — making it harder to sell cards. It requires the Department of Transitional Assistance to develop regulations and procedures to authorize other members of a household to use the card (consistent with federal law). It fines store owners who knowingly allow unauthorized persons to use a card to make purchases.

The bill also creates a fraud detection program designed to increase the probability of prosecution of recipients and store owners who are converting benefits into cash through sham transactions. The bill funds six additional fraud investigators.

The bill does include some liberalizations of benefits to the end of increasing the chances that recipients can get off welfare.  It requires recipients to develop economic independence plans and creates a savings program for benefit recipients, encouraging them to escrow a portion of their benefits and use the savings for emergency needs or a security deposit on an apartment. It allows school-attending teenagers in an assisted family to work part-time without jeopardizing eligibility.  It also eliminates the specific limit on the value of the single automobile that an assisted family can own.

This package goes much further than the ad hoc measures that the Senate rejected during the budget process and I do support it.

As we move forward, it is worth bearing in mind that MassHealth covers roughly 50% more people  and costs over six times more than TAFDC and SNAP combined. Our real budget challenge remains health care cost control.

I always appreciate comments at willbrownsberger.com, or by email at willbrownsberger@gmail.com. My cell phone is 617-771-8274 and my office number is 617-722-1280.