Where does Illinois' welfare money go?

I was reading through a Stateline news piece on welfare this week and I got to this line at the end:

“But a growing concern is that no one really knows how the state and federal TANF money is being spent.”

Um, what? That concerned me. According to the piece, the federal Government Accounting Office  figures that 71 percent of all the money spent on Temporary Assistance for Needy Families– TANF, a.k.a. welfare– is being spent on stuff that’s not “cash assistance.”

So, nearly three-quarters of the money we spend on welfare isn’t being spent on welfare? That sounded bizarre to me.

When welfare reform kicked in in the mid-’90s, the federal government changed the way it funded welfare. Instead of paying for as many people as the state enrolled, it gave each state a block grant–a big chunk of money that they could do what they like with, within reason, of course.

States were given the freedom to spend that money on cash assistance–the kind of welfare check we traditionally think of– or on a host of other programs that help the poor, like child care assistance or work support programs. Since then, the percentage of money that goes toward cash assistance has gotten smaller and smaller nationwide.

So, what does Illinois spend its TANF block grant on? I wanted to find out.

Donna Pavetti from the Center for Budget and Policy Priorities had a fact sheet on the numbers (pdf). Here’s how Illinois’ welfare block grant pie is divided:

So, most of our money goes to child care assistance–the state’s Child Care Assistance Program. In 2011, $609 million went to funding child care subsidies. That program, if you remember, will see big cuts in this year’s budget, meaning the portion that poor families pay toward child care will increase.

Another chunk of our money goes to “work-related activities.” What does that mean exactly? I asked Pavetti. It means activities like job training, employment search and transportation assistance. That’s nearly 15 percent of the spending in 2011

I wondered if there was much evidence that that much money–$185 million–had much effect on poverty.

Her answer was short and to the point.

“There is no evidence that work-related activities lead to actual work for participants,” she wrote me.

Huh. Well, that’s something I want to do more digging on. But it was the last category that really intrigued me: “Authorized under Prior Law and Other Nonassistance.”

What exactly did that even mean?

Authorized under Prior Law, or AUPL, is stuff that the previous welfare law allowed states to spend welfare money on, but that don’t meet one of four purposes listed in the new law: providing assistance for needy families; promoting work; preventing out-of-wedlock pregnancies; and encouraging marriage and the nuclear family–stuff like foster care or juvenile justice.

Illinois spends over a quarter of our block grant funds in this category. Where is it going? Mostly for expenses labeled as “child welfare.” $358 million dollars a year is a lot to spend, so I delved into where it was going.

The U.S. Department of Health and Human Services wrote a big report to Congress last year on what it spends its cash on when it comes to TANF, and part of that report detailed each state’s AUPL funds.

In 2011, Illinois reported that all its AUPL funding goes to the Department of Child and Family Services to screen, assess and investigate possible child neglect or abuse for each household that applies for welfare.

That’s a lot of cash! Plus, the rather odd implication that poor children are more likely to be abused or neglected than rich children. But I suppose that when it comes to child abuse, better safe than sorry.

In addition, there’s a host of little programs that Illinois funds through the TANF block grant that aren’t direct assistance payments either: a family preservation program that tries to rehabilitate troubled families and keep them together; domestic violence services like shelters and hotlines; after-school programs to prevent gang involvement; expenditures related to the free school lunch program; early childhood programs; teen pregnancy prevention programs; and even a scholarship program for welfare recipients.

And another million for the administration of the cash assistance program.

What struck me is that when we talk about how many people are getting handouts and are on welfare, that number is actually getting smaller and smaller, both in terms of the number of people and what they’re receiving. In 2001, we spent $191 million on cash assistance, but ten years later, we spent only $106.

And even Illinois’ block grant has gotten smaller over time–not in terms of dollars, but in real value. $585 million doesn’t go as far as it did in 1997. Adjusted for inflation, it declined 28 percent between then and now. Moreover, we have about 75,000 more poor people now in Illinois than we did back then.

So, there’s your answer to the question of where our money is going, at least in our state. The bigger question, I suppose, is whether this money is doing us any good?

That’s a harder one to answer.

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