Title 45—Public Welfare--Volume 1
PART 270—HIGH PERFORMANCE BONUS AWARDS
§ 270.1   What does this part cover?
This part covers the regulatory provisions relating to the bonus to reward high performing States in the TANF program, as authorized in section 403(a)(4) of the Social Security Act.
§ 270.2   What definitions apply to this part?
The following definitions apply under this part:
Absolute rate means the actual rate of performance achieved in the performance year or the comparison year.
Act means the Social Security Act, as amended.
Bonus year means each of the fiscal years 2002 and 2003 in which TANF bonus funds are awarded, as well as any subsequent fiscal year for which Congress authorizes and appropriates bonus funds.
CCDF means the Child Care and Development Fund.
Comparison year means the fiscal or calendar year preceding the performance year.
Fiscal year means the 12-month period beginning on October 1 of the preceding calendar year and ending on September 30.
Food Stamp Program means the program administered by the United States Department of Agriculture pursuant to the Food Stamp Act of 1977, U.S.C. 2011 et seq.
CMS is the Centers for Medicare & Medicaid Services.
Improvement rate means the positive percentage point change between the absolute rate of performance in the performance year and the comparison year, except for the calculation and ranking of States on the increase in success in the work force measure in § 270.5(a)(4).
Medicaid is a State program of medical assistance operated in accordance with a State plan under title XIX of the Act.
MSIS is the Medicaid Statistical Information System.
Performance year means the year in which a State's performance is measured, i.e., the fiscal year or the calendar year immediately preceding the bonus year.
SCHIP is the State Children's Health Insurance Program as described in title XXI of the Act.
Separate State Program (SSP) means a program operated outside of TANF in which the expenditure of State funds may count for TANF maintenance-of-effort (MOE) purposes.
SSP-MOE Data Report is the report containing disaggregated and aggregated data required to be filed on SSP-MOE recipients in separate State programs as specified in § 265.3(d) of this chapter.
State means each of the 50 States of the United States, the District of Columbia, the Commonwealth of Puerto Rico, the United States Virgin Islands, Guam, and American Samoa.
TANF means The Temporary Assistance for Needy Families Program.
We (and any other first person plural pronouns) means the Secretary of Health and Human Services or any of the following individuals or organizations acting in an official capacity on the Secretary's behalf: the Assistant Secretary for Children and Families, the Department of Health and Human Services, and the Administration for Children and Families.
§ 270.3   What is the annual maximum amount we will award and the maximum amount that a State can receive each year?
(a) Except as provided in § 270.9, we will award $200 million in bonus funds annually, subject to Congressional authorization and the availability of the appropriation.
(b) The amount payable to a State in a bonus year may not exceed five percent of a State's family assistance grant.
§ 270.4   On what measures will we base the bonus awards?
(a) Performance measures: general. In FY 2002 and beyond, we will base the high performance bonus awards on: four work measures; five measures that support work and self-sufficiency related to participation by low-income working families in the Food Stamp Program, participation of former TANF recipients in the Medicaid and SCHIP programs, and receipt of child care; and one measure on family formation and stability.
(b) Work measures. (1) Beginning in FY 2002, we will measure State performance on the following work measures:
(i) Job entry rate;
(ii) Success in the work force rate;
(iii) Increase in the job entry rate; and
(iv) Increase in success in the work force rate.
(2) For any given year, we will score and rank competing States and award bonuses to the ten States with the highest scores in each work measure.
(c) Measures of participation by low-income working households in the Food Stamp Program —(1) Food Stamp absolute measure. (i) Beginning in FY 2002, we will measure the number of low-income working households with children ( i.e., households with children under age 18 which have an income less than 130 percent of poverty and earnings equal to at least half-time, full-year minimum wage) receiving Food Stamps as a percentage of the number of low-income working households with children (as defined in this paragraph) in the State.
(ii) We will rank all States that choose to compete on this measure and will award bonuses to the three States with the highest scores. We will calculate the percentage rate for this measure to two decimal points. If two or more States have the same percentage rate for the measure, we will calculate the rates for these States to as many decimal points as necessary to eliminate the tie.
(2) Food Stamp improvement measure. (i) Beginning in FY 2002, we will measure the improvement in the number of low-income working households with children ( i.e., households with children under age 18 which have an income less than 130 percent of poverty and earnings equal to at least half-time, full-year Federal minimum wage) receiving Food Stamps as a percentage of the number of low-income working households with children (as defined in this subparagraph) in the State.
(ii) For any given year, we will compare a State's performance on this measure to its performance in the previous year, beginning with a comparison of calendar (CY) 2000 to CY 2001, based on Census Bureau decennial and annual demographic program data.
(iii) We will rank all States that choose to compete on this measure and will award bonuses to the seven States with the greatest percentage point improvement in this measure. We will calculate the percentage rate for this measure to two decimal points. If two or more States have the same percentage rate for this measure, we will calculate the rates for these States to as many decimal points as necessary to eliminate the tie.
(d) Measures of participation by low-income families in the Medicaid/SCHIP Programs. (1) Medicaid/SCHIP absolute measure. (i) Beginning in FY 2002, we will measure the number of individuals receiving TANF benefits who are also enrolled in Medicaid or SCHIP, who leave TANF in a fiscal year and are enrolled in Medicaid or SCHIP in the fourth month after leaving TANF assistance, and who are not receiving TANF assistance in the fourth month as a percentage of individuals who left TANF in the fiscal year and are not receiving TANF assistance in the fourth month after leaving.
(ii) We will rank the performance of each State that chooses to compete on this absolute measure and award bonuses to the three States with the highest scores.
(iii) We will calculate the percentage rate for this measure to two decimal points. If two or more States have the same percentage rate for this measure, we will calculate the rates for these States to as many decimal points as necessary to eliminate the tie.
(2) Medicaid/SCHIP improvement measure. (i) Beginning in FY 2002, we will measure the improvement in the number of individuals receiving TANF benefits who are also enrolled in Medicaid or SCHIP, who leave TANF in a fiscal year and are enrolled in Medicaid or SCHIP in the fourth month after leaving TANF assistance, and who are not receiving TANF assistance in the fourth month as a percentage of individuals who left TANF in the fiscal year and are not receiving TANF assistance in the fourth month after leaving.
(ii) For any given year, we will compare a State's performance on this improvement measure to its performance in the previous year, beginning with a comparison of FY 2000 to FY 2001, based on a quarterly submission by the State as determined by matching individuals (adults and children) who have left TANF assistance and who are not receiving TANF assistance in the fourth month with Medicaid or SCHIP enrollment data.
(iii) We will rank the performance of all States that choose to compete on this improvement measure and will award bonuses to the seven States with the greatest percentage point improvement in this measure.
(iv) We will calculate the percentage rate for the measure to two decimal points. If two or more States have the same percentage rate for this measure, we will calculate the rates for these States to as many decimal points as necessary to eliminate the tie.
(e) Child care subsidy measure. (1) Beginning in FY 2002, we will measure State performance based upon a composite ranking of:
(i) The accessibility of services based on the percentage of children in the State who meet the maximum allowable Federal eligibility requirements for the Child Care and Development Fund (CCDF) who are served by the State during the performance year, and who are included in the data reported on the ACF-800 and ACF-801 for the same fiscal year; and
(ii) The affordability of CCDF services based on a comparison of the reported assessed family co-payment to reported family income and a comparison of the number of eligible children under the State's defined income limits to the number of eligible children under the federal eligibility limits.
(2) Beginning in FY 2003, we will measure State performance based upon a composite ranking of:
(i) The two components described in paragraph (e)(1) of this section; and
(ii) The quality of CCDF services based on a comparison of reimbursement rates during the performance year to the market rates, determined in accordance with 45 CFR 98.43(b)(2), applicable to that year.
(3) For the affordability component in paragraph (e)(1)(ii) of this section, we will compare family income to the assessed State family co-payment as reported on the ACF-801 across four income ranges. These income ranges refer to percentages of the Federal Poverty Guidelines for a family of three persons. The income ranges are as follows:
(i) Income below the poverty level;
(ii) Income at least 100 percent and below 125 percent of poverty;
(iii) Income at least 125 percent and below 150 percent of poverty; and
(iv) Income at least 150 percent and below 175 percent of poverty.
(4)(i) For the affordability component, we will calculate, for each income range, the average of the ratios of family co-payment to family income for each family served; and
(ii) We will calculate a ratio of the number of children eligible under the State's defined income limits compared to the number of children eligible under the Federal eligibility limits in the CCDF, i.e., 85 percent of the State's median income.
(iii) We will rank each State based on each of the four averages calculated in paragraph (e)(4)(i) of this section and the ratio calculated in paragraph (e)(4)(ii) of this section and combine the ranks to obtain the State's score on this component.
(5) For the quality component specified in paragraph (e)(2)(ii) of this section, in FY 2003 and beyond, we will compare the actual rates paid by the State as reported on the ACF-801 (not the published maximum rates) to the market rates applicable to the performance year, i.e., FY 2002. Each State competing on this measure must submit the following data as a part of its market rate survey:
(i) Age-specific rates for children 0-13 years of age reported by the child care centers and family day care homes responding to the State's market rate survey; and
(ii) The provider's county or, if the State uses multi-county regions to measure market rates or set maximum payment rates, the administrative region.
(6) For the quality component, we will compute the percentile of the market represented by the amount paid for each child as reported on the ACF-801 by comparing the actual payment for each child to the array of reported market rates for children of the same age in the relevant county or administrative region. (We will compare payments for children in center-based care to reported center care provider rates. We will compare payments for children in non-center-based care, i.e., family day care and unlicensed child care, to reported family child care provider rates.)
(i) We will take the percentile that results from the per-child comparison of the actual payment to the reported market rates and compute separate State-wide averages for center-based and non-center-based care; and
(ii) We will rank the State according to the two State-wide averages and combine the ranks to obtain the State's score on this component.
(7) For any given year, we will rank the States that choose to compete on the child care measure on each component of the overall measure and award bonuses to the ten States with the highest composite rankings.
(8) We will calculate each component score for this measure to two decimal points. If two or more States have the same score for a component, we will calculate the scores for these States to as many decimal points as necessary to eliminate the tie.
(9)(i) The rank of the measure for the FY 2002 bonus year will be a composite weighted score of the two components at paragraph (e)(1) of this section, with the component at paragraph (e)(1)(i) of this section having a weight of 6 and the component at paragraph (e)(1)(ii) of this section having a weight of 4.
(ii) The rank of the measure for the bonus beginning in FY 2003 will be a composite weighted score of the three components at paragraph (e)(2) of this section, with the component at paragraph (e)(1)(i) of this section having a weight of 5, the component at paragraph (e)(1)(ii) of this section having a weight of 3, and the component at paragraph (e)(2)(ii) of this section having a weight of 2.
(10) We will award bonuses only to the top ten qualifying States that have fully obligated their CCDF Matching Funds for the fiscal year corresponding to the performance year and fully expended their CCDF Matching Funds for the fiscal year preceding the performance year.
(f) Family formation and stability measure. (1) Beginning in FY 2002 and beyond, we will measure the increase in the percent of children in each State who reside in married couple families, beginning with a comparison of CY 2000 and CY 2001 data from the Census Bureau. For any given subsequent year we will compare a State's performance on this measure to its performance in the previous year.
(2) We will rank the performance of those States that choose to compete on this measure and will award bonuses to the ten States with the greatest percentage point improvement in this measure.
(3) We will calculate the percentage rate for the measure to two decimal points. If two or more States have the same percentage rate for this measure, we will calculate the rates for these States to as many decimal points as necessary to eliminate the tie.
(g) Option to compete. Each State has the option to compete on one, any number of, or none of the measures specified in this section.
§ 270.5   What factors will we use to determine a State's score on the work measures?
(a) Definitions. The work measures are defined as follows:
(1) The Job Entry Rate means the unduplicated number of adult recipients who entered employment for the first time in the performance year (job entries) as a percentage of the total unduplicated number of adult recipients unemployed at some point in the performance year.
(2) The Success in the Work Force Rate is composed of two equally weighted sub-measures defined as follows:
(i) The Job Retention Rate means the performance year sum of the unduplicated number of employed adult recipients in each quarter one through four who were also employed in the first and second subsequent quarters, as a percentage of the sum of the unduplicated number of employed adult recipients in each quarter. (At some point, the adult might become a former recipient.); and
(ii) The Earnings Gain Rate means the performance year sum of the gain in earnings between the initial and second subsequent quarter in each of quarters one through four for adult recipients employed in both these quarters as a percentage of the sum of their initial earnings in each of quarters one through four. (At some point, the adult might become a former recipient.)
(3) The Increase in the Job Entry Rate means the positive percentage point difference between the job entry rate for the performance year and the job entry rate for the comparison year; and
(4) The Increase in Success in the Work Force Rate means the positive percentage point difference on at least one sub-measure between the success in the work force rate for the performance year and the success in the work force rate for the comparison year. It is composed of two equally weighted sub-measures defined as follows:
(i) The Increase in the Job Retention Rate means the percentage point difference between the job retention rate for the performance year and the job retention rate for the comparison year; and
(ii) The Increase in the Earning Gain Rate means the percentage point difference between the earnings gain rate for the performance year and the earnings gain rate for the comparison year.
(b) Ranking of States. (1) We will measure State performance in the work measures over the course of an entire fiscal year both for the performance year and the comparison year, if applicable.
(2) We will rank the competing States on the work measures for which they:
(i) Indicate they wish to compete; and
(ii) Submit the data specified in § 270.6 within the time frames specified in § 270.11.
(3) We will rank the States on absolute performance in each of the work measures in paragraphs (a)(1) and (a)(2) of this section. For each of the work measures in paragraphs (a)(3) and (a)(4) of this section, we will rank States based on the percentage point change in their improvement rate in the performance year compared to the comparison year. The rank of the performance in paragraphs (a)(2) and (a)(4) of this section will be a composite score of the rank of the job retention and the earnings gain measures.
(4) We will calculate the percentage rate for each work measure to two decimal points. If two or more States have the same absolute or improvement rate for a specific work measure, we will calculate the rates for these States to as many decimal points as necessary to eliminate the tie.
§ 270.6   What data and other information must a State report to us?
(a) Data for work measures. (1) If a State wishes to compete on any of the work measures specified in § 270.5(a), it must collect quarterly and report semi-annually for the performance year and, if the State chooses to compete on an improvement measure, the comparison year, the identifying information on all adult TANF recipients as specified in program guidance.
(2) Each State must submit the information in this paragraph for both adult TANF recipients and adult SSP-MOE recipients for whom the State would report the data described in paragraph (b) of this section.
(b) Data on SSP-MOE programs. In order to compete on any high performance bonus measure, each State must submit the information in Sections One and Three of the SSP-MOE Data Report as specified in § 265.3(d) of this chapter.
(c) Data for the Medicaid/SCHIP measures. If a State wishes to compete on the Medicaid/SCHIP measures in § 270.4(d), it must submit the information that we and CMS will specify.
(d) Data for the child care measure. If a State wishes to compete on the child care measure in § 270.4(e), it must report the data as required by the CCDF program and additional data on child care market rates that we will specify.
(e) Intent to compete. Each State must notify us on which of the measures it will compete in each bonus year.
§ 270.7   What data will we use to measure performance on the work support and other measures?
(a) We will use Census Bureau data to rank States on their performance on the Food Stamp measures in § 270.4(c) and on the measure of family formation and stability in § 270.4(f). We will also use Census Bureau data, along with other information, to rank States on the child care measure in § 270.4(e). We will rank only those States that choose to compete on these measures.
(b) We will rank State performance on the Medicaid/SCHIP measures in § 270.4(d) based on data submitted by those States that choose to compete on these measures, as determined by matching TANF individuals who were enrolled in Medicaid/SCHIP and are no longer receiving TANF assistance with Medicaid/SCHIP enrollment data.
(c) We will rank State performance on the child care measure based on data submitted by those States that choose to compete on this measure. We will use data reported on Forms ACF 800, ACF 801, ACF 696 and other necessary data we will specify.
§ 270.8   How will we allocate the bonus award funds?
(a) In FY 2002 and beyond, we will allocate and award $140 million to the ten States with the highest scores for each work measure as follows, subject to reallocation as specified in § 270.9:
(1) Job Entry Rate—$56 million
(2) Success in the Work Force—$35 million
(3) Increase in Job Entry Rate—$28 million
(4) Increase in Success in the Work Force—$21 million;
(b) In FY 2002 and beyond, we will allocate and award $20 million to the ten States with the highest scores on the Food Stamp measures and $20 million to the ten States with the highest scores on the Medicaid/SCHIP measures, subject to reallocation as specified in § 270.9. For these measures, we will:
(1) Award $6 million to the three States with the highest scores on the Food Stamp absolute measure;
(2) Award $6 million to the three States with the highest scores on the Medicaid/SCHIP absolute measure;
(3) Award $14 million to the seven States with the highest scores on the Food Stamp improvement measure; and
(4) Award $14 million to the seven States with the highest scores on the Medicaid/SCHIP improvement measure.
(c) In FY 2002 and beyond, we will allocate and award $10 million to the ten States with the highest scores on the child care subsidy measure and $10 million to the ten States with the highest scores on the family formation and stability improvement measure.
(d) We will distribute the bonus dollars for each measure based on each State's percentage of the total amount of the State family assistance grants of the States that will receive a bonus.
§ 270.9   How will we redistribute funds if that becomes necessary?
(a) If we cannot distribute the funds as specified in § 270.8, we will reallocate any undistributed funds among the measures listed in § 270.4.
(b) If we still cannot distribute funds within the bonus year, they will remain available for distribution in the next bonus year, to the extent authorized by law.
§ 270.10   How will we annually review the award process?
(a) Annual determination. Annually, as needed, we will review the measures, data sources, and funding allocations specified in this part to determine if modifications, adjustments, or technical changes are necessary. We will add new measures or make changes in the funding allocations for the various measures only through regulations.
(b) Criteria. We will determine if any modifications, adjustments, or technical changes need to be made based on:
(1) Our experience in awarding high performance bonuses in previous years; and
(2) The availability of national, State-reliable, and objective data.
(c) Consultation. We will consult with the National Governors' Association, the American Public Human Services Association, and other interested parties before we make our final decisions on any modification, adjustment, or technical changes for the bonus awards. We will notify States and other interested parties of our decisions through annual program guidance. We will also post this information on the Internet.
§ 270.11   When must the States report the data and other information in order to compete for bonus awards?
(a) All measures. Each State must submit a list of the measures on which it is competing by February 28 of each bonus year.
(b) Work measures. Each State must collect quarterly and submit semi-annually during the bonus year the data specified in § 270.6(a) as follows:
(1) The data for the first and second quarters of the performance year and, if a State chooses to compete on an improvement measure, the first and second quarters of the comparison year, must be submitted by the dates we will specify in program guidance.
(2) The data for the third and fourth quarters of the performance year and, if a State chooses to compete on an improvement measure, the third and fourth quarters of the comparison year, must be submitted by the dates we will specify in program guidance.
(c) SSP-MOE reporting. Each State must collect quarterly its SSP-MOE Data Report as specified in § 270.6(b) and submit it:
(1) At the same time as it submits its quarterly TANF Data Report; or
(2) At the time it seeks to be considered for a high performance bonus as long as it submits the required data for the full period for which this determination will be made.
(d) Medicaid/SCHIP measures. Each State must submit the data required to compete on the Medicaid/SCHIP measures by the dates and in a manner that we and CMS will specify.
(e) Child care subsidy measure. Each State must submit the data required to compete on the child care measure by the date(s) we will specify.
§ 270.12   Must States file the data electronically?
Each State must submit the data required to compete for the high performance bonus work measures and the Medicaid/SCHIP measures electronically in a manner that we and CMS will specify.
§ 270.13   What do States need to know about the use of bonus funds?
(a) A State must use bonus award funds to carry out the purposes of the TANF block grant as specified in section 401 (Purpose) and section 404 (Use of Grants) of the Act.
(b) As applicable, these funds are subject to the requirements in and limitations of sections 404 and 408 of the Act and § 263.11 of this chapter.
(c) For Puerto Rico, Guam, the Virgin Islands, and American Samoa, the bonus award funds are not subject to the mandatory ceilings on funding established in section 1108(c)(4) of the Act.
(d) States must report quarterly on the use of the bonus funds.