“In spite of the state’s strong economy, many families are struggling,” Linda O’Neal, the former executive director of the Tennessee Commission on Children and Youth, said during a conference call Thursday organized by the Tennessee Justice Center.
That applies in particular to poor families who receive help through the Temporary Assistance for Needy Families program, a federal block grant initiative. Tennessee’s program is called “Families First.”
According to the Tennessean, the state has stockpiled roughly $730 million worth of TANF funding plus an additional $300 million from a federal Child Care Development Fund designed to assist working families.
During the call on Thursday, O’Neal was one of four experts who discussed how the state could use the extra funding as an opportunity to address issues surrounding childhood poverty in Tennessee, which she said ranks in the worst 10 states for the proportion of children living in poverty.
While the percentage of children in poverty in the state has declined or remained stable in the current economy, O’Neal said the rate has remained persistently high for some groups. Poverty rates are 1-in-6 for white children but 1-in-3 for minority children.
Additionally, the number of children and families covered by TANF has consistently declined over the years from 95,000 families in 1996 to an average of 20,000 families in recent months, a roughly 80% percent drop since 1996.
While the state has increased TANF grants from a maximum of $185 per month for a family of three to a maximum of $277 per month, O’Neal said this allotment is still only 15% of the federal poverty line and is the fifth lowest in the country. It covers less than a third of the fair market rent for a two-bedroom apartment.
Increasing funding for TANF, O’Neal said, would also help reduce the impact of adverse childhood experiences — incidents like abuse, neglect and domestic violence that have a negative impact on health outcomes and social and emotional development.
“Studies have demonstrated that even relatively small increases in family income for struggling families leads to improved school performance for children and reduced stress in the family,” she said.
LaDonna Pavetti, vice president for family income support for the Center on Budget & Policy Priorities, suggested four changes the state could implement to help poor families. The first involves increasing the state’s Families First cash benefit to 25% of the federal poverty line, which would mean increasing that benefit from $277 to $477 per month for a family of three.
Reaching that threshold wouldn’t help families satisfy all of their basic needs, Pavetti said, but it would be an improvement over the current allotment. That increase would cost the state about $40 million annually, but Pavetti noted that the state receives roughly $190 million in federal TANF funds each year, a figure Tennessee has been consistently underspending.
“It is well within their reach to do that,” she said.
Second, Pavetti said the state could think about providing targeted, ongoing assistance for high-cost needs like transportation or housing. Maine, for example, offers a special allowance of up to roughly $300 a month for families whose housing cost exceeds 50% of their income, and Minnesota provides an average monthly stipend of $200 to TANF families participating in work activities or have left the program for work.
A monthly stipend of $200 for 5,000 families a year, Pavetti said, would cost $12 million, which is roughly 6% of the state’s annual block grant.
Third, Pavetti suggested the state evaluate ways outside of TANF to provide short-term assistance to poor families who experience a crisis. She said there could also be a way to dedicate funding for homeless families to help them secure stable housing.
“Those are two different ways in which you could really think about ways to provide cash assistance that could be very beneficial to families that is not ongoing assistance but is more of a short-term way to meet their basic needs,” she said.
Finally, the state could consider ways to help parents improve their work experience and skills, increasing their chance of finding employment that will sustain their families over the long term.
“If the state did all of the things that I described, they would still have substantial resources left to fill other important service gaps,” she said.
A spokesman for Gov. Bill Lee’s office did not immediately respond Thursday to a request for comment on the state’s plans for the stockpiled money.