Recipients back to work. Though it is suddenly find it is executed by the states. The house ways and means a subcommittee hearing is about two hours. [inaudible conversations] the committee will come to order. Welcome to our subcommittee hearing. For the working welfare subcommittee. Where is all aware for money going from reclaiming tanf not assistance dollars to lift americans out of poverty. My name is downloaded and arrives in illinois 16th district of illinois. Much of central and northwest parts of the state. Recently republicans were able to secure a major victory with the fiscal responsibility act, which strengthen, which strengthen work requirements in the direct cash assistance portion of the temporary assistance for needy families program. Those changes followed our hearing in march in this room highlighting loopholes in the current law that allowed states to game gain the work partn rate. This hearing will take the next debt by focusing on the other side of tanf which is not Assistance Spending. Not assistance funding constitutes the majority of the tanf block grant, nearly 78 of combined federal and state spending. This is spending that is not basic assistant or direct checks to welfare recipients. Concerns have emerged that the not assistance part of tanf likes guardrails and instead focus on helping people move from welfare to work. National headlines fueled by a massive investment scandal in mississippi have drawn increased scrutiny about tanf, leading people to ask where is all the welfare money going . In june republican nibs of the ways and Means Committee sent a letter to hhs asking the agency about the response to mississippi and efforts to safeguard federal funds in other states. In response hhs outlined a number of statutory limitations that constrain their ability to conduct oversight and indicated a willingness to work with the committee to improve the tanf program. Ive heard from my colleagues on both sides of the aisle who have expressed frustration on this point. In fact, during our last tearing my friend from wisconsin ms. Moore shared her concern about how states are using tanf money to comment about question we use the funds in wisconsin for luxury apartments. I agree with ms. Moore and many others. Current tanf law lacks basic financial safeguards included in most other federal programs making it easy for states to divert funds and increasing the risk of fraud and abuse. Here are some of the examples. First, current law permits states to use federal grants end quote any manner that is reasonably calculated unquote to achieve one of tanis four four purposes which is to provide assistance to needy families, independence of needy parents on independence, reduce out of luck pregnancies and promote the formation of two parent families. These are worthy goals but its rare for allowable spending in a federal program to be solely defined by vaguely written purposes. Second, unlike most federal programs the tanf statute does not put limits on administrator pekoske application deadlines for spending funds. As a result Program Management is one of the four largest expenditure categories. Further, with the deadline to spend tanf dollars many states have built up larger reserves instead of spinning him on families who need them. Third, tanf is not subject to the payment integrity information act, even though the office of management and budget identified tanf as a susceptible program, hsas never reported an improper payment rate estimate. Finally, tanf law allows states to spend funds on a wide variety of social Services Like social welfare and childcare. But with none of the federal rules that normally apply. This has resulted in tanf been spent on programs that are not track for outcomes for the cold services being paid for with federal tax dollars. All of this adds up to evolvable program that makes it possible for fraud and abuse to occur like what happened in the state of mississippi. One of her Witnesses Today mr. Shad white is first and knowledge of mississippi case and is due to pellagra conditions on how be avoided in other states in the future. Today will also hear from witnesses examples of how states have been able to use tanf not Assistance Funds to strategically support initiatives that do effectively move individuals from welfare to work. Some states have also built their Strong Financial controls and audit practices which can be remedied, can be used in other states. Chose to stash tens of millions of dollars rather than help poor families. Republicans insisted on imposing crushing administered burdens designed to kick families off direct cash assistance under the guise of accountability. Even the republican witnesses recommended lessening work requirements and restrictions on education and training, the gop debt limit provisions double down on harsh work requirements. These republican driven policies trapped families in poverty by rejecting them altogether. She families into meager child only tanf are forcing them into Poverty Level jobs rather than building economic security. Republicans insisted on tanf being a block grant that gave states wide latitude to Fund Activities that do not help poor parents. Incredibly, unlike any other law, republicans insisted on a statutory prohibition on federal oversight that limits transparency, fraud detection, and enforcement. When mississippi advocates asked the subcommittee for help years ago to get the Trump Administration to examine how the state was using tanf, we had to direct them to state officials to investigate this issue due to this prohibition on enforcement. Unfortunately, even after the fraud revelation advocates still cannot get answers about how tanf is used locally. I hope that our witness state audit rate will help remedy that lack of transparency. It is also deeply troubling that less than 24 hours after the tanf fraud was announced, mississippi lawmakers at the urging of state auditor white advanced a bill to allow him to review the tax returns of tanf cash recipients, a requirement that was not imposed to my knowledge on the many tanf subcontractors and businesses. So let us be clear. Tanf is working exactly as the republican tanf system was designed. Democrats absolutely think tanf needs a fundamental overhaul, but any reform should start with improving family stability by reducing burdensome requirements and providing sufficient access to financial support, child care, education, and Career Pathways to help families strive. Families need stability before parents can be reliable workers, and reliable workers need quality jobs to escape poverty. Predictable Financial Assistance is central to stability for parents to hold selfsustaining jobs. We saw during the pandemic that reliable Financial Assistance via the Child Tax Credit help cut Child Poverty by 40 . Further, a recent report by chapin hall details how state policies that increase access to tanf and cash assistance are associated with a decreased child maltreatment. For example, a 100 increase in tanf cash benefits is associated with reduction in maternal selfreported physical child maltreatment. In contrast for families receiving tanf who experience maternal hardship such as difficult in the basic needs, they are three times more likely to experience a neglect, investigation, and four times more likely to experience a physical abuse investigation. Tanf benefits in most states remain at their lowest value since the program started in 1996. 1996. Yet, Research Shows that families with children under the age of five receiving an extra 3000 per year boost childrens adult earnings by 17 . So investing in cash assistance and now would help lift children out of poverty both now and in the future. A failure of tanf false disproportional on children of color whose families experience greater barriers to economic stability. Black, American Indian and alaskan native, asian and latino children experience higher poverty rates than white children. Yet, 48 of black children live in states with the benefits about below 20 of the federal Poverty Level, compared to only 35 of white children. I served on this committee back when there was a good faith bipartisan effort to reform tanf. Now those efforts have been repeatedly, repeated by extremists demanding harsher work requirements, limiting states and using not assistance dollars would do nothing to let americans out of poverty. If we do nothing to help states serve low income families by providing cash assistance and work supports while also removing the ineffective work requirements. I thank you, mr. Chairman, and yield back. Thank you mr. Davis. Its my pleasure now to yield to the full chairman of the ways and Means Committee, mr. Jason smith. Thank you, chairman lahood and Ranking Member davis for holding this hearing about how congress can strengthen the nondirect assistance side of the temporary assistance for needy families, or tanf. To lift more americans out of poverty and protect the taxpayers who fund the program. I would also like to give a special welcome to one of her Witnesses Today, mr. Roberts knodell, the director of the department of social services in my home state. Hes a native of gods country, the best Congressional District in the entire nation, missouris eighth, which happens to be my district. And also graduate of Southeast Missouri state. Hes a fighting redhawk. We are glad youre here, robert. Robert combines his love of missouri with a career thats dedicated to service, focusing on improving education and social services. Robert, thank you so much again for being here. Its an honor to have you. In hearings all around the country, we have heard how Small Businesses are being impacted by the labor shortage. The fiscal responsibility act, it delivered a major win for families and Small Businesses by strengthening work requirements in the tanf program. Also put an end to attempts by states to exploit loopholes around the work Participation Rate and forcing to measure outcomes that matter. Like how many recipients get a job. This was a major step toward restoring the program to its core mission. Acting as a bridge out of poverty. We have more work to do though. Almost eight in every ten dollars in this program are spent on something other than direct checks to families. Tanf was meant to help people get a job, but we need asic financial guardrails to guarantee taxpayer money is not wasted. That lack of accountability has opened the door for states to treat tanf nonpersistent funds like a slush fund in some cases states use the funds to fill budget gaps for unrelated purposes here and others these funds pay for social programs that the federal government already pays for but avoids federal rules on how states can use that money, creating even more duplication and overlap. In the worse cases the lack of controls and accountability has led to write fraud and abuse it for example, in mississippi 77 million and not assistance tanf dollars was misspent through waste, fraud, and abuse. To put this in perspective, mississippi receives 86 million in tanf annually, and has the highest rate of Child Poverty in the entire country. Money that should have gone towards of the vulnerable with instead toward building volleyball courts. Every ways and means republican has asked secretary becerra shs has taken any action to correct this situation. On its current path, tanf not assistance is saving beneficiaries who need economic security, and is also failing taxpayers whose money should be spent intentionally and strategically to support work. The basic problem at hand is the lack of accountability. More money tomorrow does not solve the problem of misspending money today. Thank you to each of our witnesses for testifying today about how to ensure tanf fulfills its mission of lifting people out of poverty through work. Yield back, mr. Chairman. Thank you, chairman smith. We are pleased to have our witnesses are today and we have a tremendous amount of experience here today with all of you and so want to thank you for being here today. I will now introduce them. Mr. Clarence carter, ill start for my left to right, is a commissioner of the Tennessee Department of Human Services. Mr. Shad white is state auditor for the state of mississippi. Mr. Roberts knodell is the director of the Missouri Department of social services. Ms. Kristi putnam is a secretary of the Arkansas Department of Human Services and doctor Aisha Nyandoro is the ceo of Supreme Court opportunities in jackson, mississippi. Welcome to you all. Mr. Carter i will never recognize you for five minutes to deliver your opening statement. Chairman lahood, Ranking Member davis and members of the subcommittee, thank you for the opportunity to testify a potential reforms to the tanf program specifically, and on a broader statement in general. My name is Clarence Carter and i currently serve as commissioner of the Tennessee Department of Human Services in the administration of governor building. Tendency of my last stop in a 32 year career in the administration of Public Safety net programs and agencies at the federal, state and local levels of government. During that career ive had the blessing and good fortune of serving two president s, four governors and the mayor in this my life purpose and passion. My career predates the welfare reform of 1996. I harken back to the excitement and anticipation of that era at that time i was serving as virginias commission of the department of social services. I recall a conversation i had with one of our consumers regarding her experience with the new program. She said to me, when they told i would have to, would have to work, i was scared. She had not been employed since the birth of her first child 15 years prior, and as such had serious concerns about her ability successfully rejoin the workforce. She recounted how her case manager believed in her and assisted her in finding a a j. She went on to say, do you know what i did with my first paycheck . I took my kids out for pizza. With tears streaming down her face, finally she said with pride, mr. Carter, at the beginning i was afraid but now i know i will never be unwell for again does i know i can do this. I share this reflection because it is that their inspiration and hope and vision that tries me every day in work. Mere subsistence is not enough. Individuals need help and the ability to determine their own destiny. Our system of public support should be about freeing people to act in their own best interest, not making the boars of an everexpanding and complex public assistance system. The tanf program was built on two fundamental principles, work for receipt of benefits and time limits. While those twin pillars are as important today as they were 277 years ago, we have fallen far short of the lofty goals in envisioned at the signing of the legislation. In the Previous Administration i served as director of the office of family assistance, the Program Office within hhs task with administering tanf program. Upon arrival in 2017 we saw there was in excess of 5 billion in unexpended tanf funds nationwide. We sent a letter encouraging states to use unexpended balances to demonstrate innovations in the program. Unfortunately, our encouragement fell flat. States needed more than encouragement from the federal government. They needed a mechanism and additional funding to do so. It was with that understanding that guided us in crafting the opportunity and economic mobility demonstrations which were included as part of the president s budget in fiscal year 20, fiscal year 21, and have included those budget proposals with my written testimony. Little did i know that the next stop in my professional journey would afford me the opportunity to put into practice when i had encouraged at the federal level. But the unexpended tanf monies nationwide, tennessee had the largest amount in excess of 700 million. This brings us to what we are doing with the tanf and governor lees administration. In conjunction with our department of Human Services, state legislature and governor crafted the tanf opportunity act. This legislation was designed to serve families in need and mandate, and mandated a force spinning mechanism. Perhaps most impactful for this committee this legislation also authorized seven largescale demonstrations aimed at helping families overcome the challenges they face. The objective of these threeyear demonstration is to test the unique Community Design collaborative models for building the economic, social and development of capacity of tanf recipients. Their results will provide valuable insights into how best to refine overall tanf model. Another important component of this legislation is its emphasis on evaluation and finding out what works. To accomplish this we engaged in an evaluation from to design random controlled trials for each of the seven demonstrations. The Gold Standard in scientific evaluation. In closing, we find herself in an important crossroads in the history of our nation safety net. The work of the subcommittee and positive impact the lives of millions of americans. I believe in the interventions that taken in tennessee are for a framework that can launch the next generation of