By Logan Pike and John Nothdurft
Georgia’s dreadful welfare system is perhaps one of the worst in the nation, but the Legislature has an opportunity to reform the failing program and provide significant, lasting changes that will improve the lives of thousands of Georgia’s citizens.
The Georgia Senate passed a welfare reform bill that will improve opportunities for upward mobility and self-sufficiency and protect those people who truly need assistance. The bill has been offered in large part as a result of four important hearings held in 2015 by the Georgia House Study Committee on Welfare Fraud, chaired by state Rep. David Clark (R-Buford). Those hearings were created to study the “conditions, needs, issues, and problems regarding Georgia welfare programs.”
Georgia received an F- grade in the Heartland Institute’s 2015 Welfare Reform Report Card, an analysis of every state’s welfare policies since the passage of the Personal Responsibility and Work Opportunity Reconciliation Act (PRWORA) in 1996. The Peach State was ranked 44th in the nation for its anti-poverty Temporary Assistance for Needy Families (TANF) policies.
The new proposal would decrease lifetime limits on eligibility for TANF, strengthen sanctions for recipients who fail to participate in the immediate TANF work requirements and implement a cash diversion program and common-sense welfare fraud prevention practices, which would save taxpayer dollars and preserve taxpayer-funded welfare programs for those truly in need of help.
These reforms would move Georgia to ninth, or an A- in Heartland’s report card.
While Georgia has been relatively successful in reducing its number of TANF recipients since 1996, its overall poverty rate has continued to increase and unemployment rates have worsened. Georgia had a 24.2 percent increase in poverty rate from 1996 to 2013, according to the U.S. Census Bureau and the Annie E. Casey Foundation.
The central component for helping people escape poverty is work. Only 2.6 percent of full-time workers are poor, as defined by the federal poverty level standards, compared with 23.9 percent of adults who do not work. Even part-time work makes a significant difference; only 15 percent of part-time workers are poor. The state made significant progress implementing immediate work requirements after the 2015 Welfare Reform Report Card was released.
Despite its many positive outcomes, few experts focus on cash diversion. Cash diversion programs allow case workers the ability to provide applicants with lump-sum cash payments to meet short-term needs. In return for the money, the recipient agrees not to receive TANF funding for an agreed-upon period. Thirty-three states, including neighbors Florida and Tennessee, successfully use cash diversion to let recipients fix broken cars to get to work or pay for some immediate need without becoming dependent on government services.
At 48 months, Georgia has a slightly lower limit of TANF lifetime eligibility or individuals and families than required under the 1996 welfare reform law. In recent years, states as diverse as Arkansas, Connecticut, Idaho and Indiana have set their time limits at 24 months or less. Research shows being dependent on welfare for five years or more can ingrain habits and lifestyles that make it very difficult to achieve self-sufficiency.
Georgia needs to put in place protections to ensure those who are enrolled in TANF and the state’s food stamp program – Supplemental Nutritional Assistance Program (SNAP) – are actually in need of the financial help they receive. According to the Foundation for Government Accountability, “[B]etween five percent and 25 percent of states’ welfare spending has been found to be wasted or fraudulent.” In 2014, 21 percent of the population was enrolled in SNAP.
One way to ensure only those truly in need are entering government-funded social programs is to utilize asset tests. Just 14 states use asset tests to check food stamp eligibility. The current income and asset test for SNAP requires recipients to have a gross income below 130 percent of the poverty level, a net income below 100 percent of the poverty level, and less than $2,000 in assets.
Many SNAP recipients are accepted under looser standards, however, through “categorical eligibility:” not by the income and asset limitations established for SNAP, but by participation in other cash welfare assistance programs, which can have more relaxed eligibility standards.
Those serious about welfare reform know that many barriers are responsible for prolonged periods of poverty. A lack of job training, transportation challenges and drug and alcohol dependency can all prevent recipients from achieving self-sufficiency. Georgia should follow the lead of other states and better integrate their welfare and state social services by co-locating service providers. This helps government bureaucracies share information and gives caseworkers more flexibility to direct their clients to the services they need.
Instead of trapping welfare recipients in a sustained cycle of poverty, Georgia policies can help by giving them a hand up. Adopting reforms such as a cash diversion program, strict-but-fair time limits and sanctions, and enforcing fraud prevention measures will improve opportunities for recipients to reach self-sufficiency, give help to those people who truly need assistance, and protect taxpayers.
This commentary was written for the Georgia Public Policy Foundation by Logan Pike (Lpike@heartland.org), state government relations manager at The Heartland Institute and co-author of Heartland’s 2015 Welfare Reform Report Card, and John Nothdurft (John@heartland.org), director of government relations at The Heartland Institute. The Georgia Public Policy Foundation is an independent, state-focused think tank that proposes market-oriented approaches to public policy to improve the lives of Georgians. Nothing written here is to be construed as necessarily reflecting the views of the Georgia Public Policy Foundation or as an attempt to aid or hinder the passage of any bill before the U.S. Congress or the Georgia Legislature.
© Georgia Public Policy Foundation (March 4, 2016). Permission to reprint in whole or in part is hereby granted, provided the authors and their affiliations are cited.