TEMPORARY ASSISTANCE

FOR NEEDY FAMILIES

Workforce Participation 

Requirement Waivers

Statement of Kay E. Brown, Director 

Education, Workforce, and Income Security 

Testimony Before the Subcommittee on 

Human Resources, Committee on Ways 

and Means, House of Representatives

For Release on Delivery 

Expected at 9 a.m. EST

Thursday, February 28, 2013

GAO-13-423T

United States Government Accountability Office

GAO
Page 1 GAO-13-423T 

United States Government Accountability Office 

Washington, DC 20548

Chairman Reichert, Ranking Member Doggett, and Members of the 

Subcommittee:

I am pleased to have the opportunity to participate in today’s discussion 

of waivers related to work participation provisions in the Temporary 

Assistance for Needy Families (TANF) block grant. TANF provides $16.5 

billion to the states each year to assist low-income families and requires 

states to meet work participation rates to ensure that a specific 

percentage of families receiving TANF include a member engaged in 

work activities that are defined by federal law. Under section 1115 of the 

Social Security Act, the Department of Health and Human Services (HHS) 

has the authority to waive compliance with certain provisions of that Act, 

including some related to TANF.1 As you know, in its July 12, 2012, 

Information Memorandum,2 HHS asserted that this authority includes the 

ability to waive TANF requirements related to definitions of work activities 

and the calculation of work participation rates. HHS informed states that it 

would use this waiver authority to allow states to test various strategies, 

policies, and procedures designed to improve employment outcomes for 

needy families.3 The Information Memorandum sets forth requirements 

that must be met for a waiver request to be considered by HHS, including 

an evaluation plan, a set of performance measures that states will track to 

monitor ongoing performance and outcomes, and a budget including the 

costs of program evaluation. In addition, the Information Memorandum 

provides that states must seek public input on the proposal prior to 

approval by HHS.4

 

1

Codified at 42 U.S.C. § 1315.

2

Transmittal No. TANF-ACF-IM-2012-03. 

3

On September 4, 2012, we held that this Information Memorandum constitutes a rule and 

is subject to the Congressional Review Act’s requirement that it be submitted to Congress 

and the Comptroller General before taking effect. See B-323772, Sept. 4, 2012.

4

Questions have been raised about the extent of HHS’s authority under section 1115 and 

TANF with respect to the Information Memorandum; however, neither this testimony, nor 

our recently issued products, B-323772, Sept. 4, 2012 or GAO-12-1028R, Sept. 19, 2012 

address whether the Information Memorandum is a valid interpretation of statutes or 

regulations. 

 
 

Page 2 GAO-13-423T 

My remarks today are based primarily on our September 2012 

correspondence examining waivers related to TANF5 and will address key 

findings from this correspondence on whether (1) HHS had granted any 

TANF waivers or previously indicated it had the authority to waive TANF 

work requirements, and (2) any states requested waivers of TANF work 

requirements or any other provision of TANF since 1996. To gather the 

information for that correspondence, we reviewed relevant federal laws 

and regulations, reviewed HHS documents, and interviewed HHS 

officials. We did not analyze whether HHS has the authority to issue 

waivers related to TANF work requirements. We conducted that work 

between August 2012 and September 2012 in accordance with all 

sections of GAO’s Quality Assurance Framework that were relevant to 

our objectives. The framework requires that we plan and perform the 

engagement to obtain sufficient and appropriate evidence to meet our 

stated objectives and to discuss any limitations in our work. We believe 

that the information and data obtained, and the analysis conducted, 

provide a reasonable basis for any findings and conclusions.

We found that although many states requested and received waivers 

under the Aid to Families with Dependent Children (AFDC) program, no 

section 1115 waivers of TANF requirements have been granted by HHS 

since TANF’s creation in 1996.6 Since 2000, several states have 

expressed interest in the availability of waivers. For example, in 2001, 

one state asked HHS about waiving various requirements including the 

work participation requirement, due to an emergency situation caused by 

a terrorist attack. The Assistant Secretary for Children and Families or 

TANF program staff have generally responded that the requested waiver 

authority was not available. Between when HHS issued its July 12, 2012 

Information Memorandum and September 6, 2012, eight states 

expressed interest in pursuing waivers, but no state had officially 

requested one.

 

5

GAO, Worker and Family Assistance: Waivers Related to the Temporary Assistance for 

Needy Families Block Grant, GAO-12-1028R, (Washington, D.C.: September 19, 2012).

6

The AFDC program preceded and was replaced by the TANF program.

Summary
 

Page 3 GAO-13-423T 

The Personal Responsibility and Work Opportunity Reconciliation Act of 

1996 (PRWORA), which amended the Social Security Act, replaced 

AFDC with the TANF block grant, which was designed to give states the 

flexibility to provide both traditional welfare cash assistance benefits as 

well as a variety of other benefits and services to meet the needs of lowincome families and children.7 The TANF block grant provides states with 

a fixed amount of federal dollars annually and also includes state 

maintenance-of-effort (MOE) requirements, which require states to 

maintain a significant portion of their historic financial commitment to 

welfare-related programs.8

In keeping with TANF’s goal of helping parents prepare for and find jobs, 

states are generally held accountable for ensuring that at least 50 percent 

of all families receiving TANF cash assistance and considered workeligible include an individual who participates in one or more of the 

federally defined allowable work activities for the required number of 

hours each week.

TANF has four purposes: (1) provide 

assistance to needy families so that children may be cared for in their 

own homes or homes of relatives; (2) end dependence of needy parents 

on government benefits by promoting job preparation, work, and 

marriage; (3) prevent and reduce out-of-wedlock pregnancies; and (4) 

encourage two-parent families. Within these goals, states have 

responsibility for designing, implementing, and administering their welfare 

programs to comply with federal guidelines, as defined by federal law and 

HHS.

9

 

7

Pub. L. No. 104-193, § 103(a), 110 Stat. 2105, 2112. 

The law also contains a provision known as the 

8

TANF MOE provisions include specified state spending levels and general requirements 

on the use of funds. For example, these provisions generally require that each state spend 

at least 80 percent (75 percent if the state meets its work participation requirement) of the 

amount it spent on certain welfare and related programs in fiscal year 1994, before TANF 

was created. If a state does not meet its MOE requirements in any fiscal year, the federal 

government will reduce dollar-for-dollar the state’s federal TANF grant in the following 

year. 

9

There are 12 work activities that may count toward meeting the specified work 

participation rate: unsubsidized employment, subsidized private sector employment, 

subsidized public sector employment, work experience (if sufficient private sector 

employment is not available), on-the-job training, job search and job readiness assistance, 

community service programs, vocational education training, job skills training directly 

related to employment, education directly related to employment (if the recipient has not 

received a high school diploma or certificate of high school equivalence), satisfactory 

secondary school attendance or in a course of study leading to a certificate of general 

equivalence, and providing child care services to others in community service. 

Background
 

Page 4 GAO-13-423T 

caseload reduction credit, which allows states to reduce the work 

participation rate they are required to meet based on reductions in the 

size of their TANF caseload. In addition, TANF regulations provide that 

states that spend more than their MOE requirements generally receive 

additional caseload reduction credits. Over the years, states have 

typically engaged about one-third of families in allowable work activities 

nationwide. States that do not meet their required work participation rates 

are at risk of being penalized through reductions in their block grant.

Prior to the creation of TANF in 1996, a large number of states applied for 

and received waivers related to various requirements of the AFDC 

program.10 Between the years of 1987 and 1996, 46 states received 

approval to implement section 1115 waivers affecting their AFDC 

programs.11 According to the Congressional Research Service, a total of 

113 waivers were granted during this time period.12 These waiver 

initiatives included placing time limits on the receipt of benefits and 

strengthening work requirements, among others. According to HHS, 

many of the policies and concepts included in state waiver requests were 

later incorporated into PRWORA. In addition, many states that received 

section 1115 waivers under AFDC were allowed to continue to operate 

their TANF programs under these waivers until their expiration, the last of 

which expired in 2007. No provision in law allowed these AFDC waivers 

to be extended.

 

10For additional information related to section 1115 waivers, please see GAO-12-1028R. 

11When we refer to states, we include the District of Columbia.

12The majority of these waivers—83 from 44 states—were granted between the years of 

1993 and 1996. Between 1987 and 1989 15 waivers were approved for 14 states and 

another 15 waivers from 12 states were approved between 1989 and 1993. 
 

Page 5 GAO-13-423T 

Since the creation of TANF, HHS has not granted any section 1115 

waivers related to TANF. Based on our discussions with HHS officials and 

our review of HHS documents, we did not find any evidence that HHS 

stated that it has the authority to issue waivers related to TANF work 

requirements before the July 12, 2012 Information Memorandum. 

However, in an HHS document prepared in 2008 on program flexibilities 

available during times of disaster, HHS stated that section 1115 allows for 

waivers of state plan requirements in several programs, including TANF. 

HHS also said that section 1115 waivers are not disaster specific and are 

better for long-term situations due to approval time.

In the 16 years since TANF was created, several states have expressed 

interest in TANF waivers. Specifically, from 2000 through 2009, evidence 

shows that five states asked HHS about the availability of waivers under 

TANF. Generally, states were not asking for waivers to test new 

approaches through experimental, pilot, or demonstration projects, which 

would be necessary in order to get a waiver under section 1115; instead, 

they were asking to be excused from specific requirements.13

• Two states sent letters to HHS requesting waivers of various federal 

TANF requirements to address unanticipated circumstances each 

faced. First, in 2001, a state asked HHS about various waivers due to 

the emergency situation caused by the September 11 terrorist attacks. 

The state was concerned about meeting TANF requirements related 

to, for example, the use of funds, data reporting, cost allocation, and 

work participation. Second, in 2004, a state asked HHS about various 

waivers after its legislature provided a portion of the state’s federal 

TANF block grant to two tribes operating their own TANF cash 

assistance programs. In both cases, states thought that the 

unanticipated circumstances could result in their noncompliance with 

certain federal TANF requirements. The Assistant Secretary for 

Children and Families responded to each state that he did not have 

authority to provide waivers. He did, however, offer to work with the 

states to address their concerns through other flexibilities allowed 

under the law.

 

13Two states also asked HHS in 2003 if it would extend waivers that had been approved 

under AFDC. However, HHS Secretary Thompson indicated in his responses to these 

states that there was no provision of law that would permit HHS to extend such waivers.

HHS Has Not 

Previously Granted 

Waivers Related to 

TANF Requirement

States have 

Expressed Interest in 

Various TANF Waivers
 

Page 6 GAO-13-423T 

• Three other states asked HHS more informally through email about 

waivers of particular TANF provisions. Specifically, states asked about 

waivers related to the limit on the maximum percentage of TANF 

families participating in vocational education that count toward a 

state’s work participation rate, the use of TANF funds for purposes 

other than the four purposes prescribed in federal law, and the 

eligibility of certain populations for TANF cash assistance. To each of 

these states, HHS TANF program staff generally responded that the 

requested waiver authority was not available.

In addition to responding directly to individual states about waiver issues, 

HHS discussed these issues when it provided general information to help 

answer states’ questions about TANF under disaster conditions. Two 

TANF policy documents issued by HHS in 2005 and 2007 discussed 

various aspects of administering TANF for families affected by disasters, 

including, for example, application procedures and work requirements. In 

these documents, HHS stated that all applicable programmatic 

requirements apply to a family that is provided TANF-funded cash 

assistance, and the Department does not have authority to waive any of 

the provisions. HHS also discussed certain flexibilities allowed under 

TANF that states might use to assist these families.14

States also expressed their interest in waivers under TANF and other 

related programs in a 2005 letter to the Congress on TANF 

reauthorization. Specifically, 28 states expressed support for a Senate 

reauthorization bill that included increased waiver authority to coordinate 

across multiple programs serving low-income families, including TANF, as 

well as certain amendments to TANF work requirements.15

In 2011, some states expressed interest in TANF waivers when HHS 

solicited ideas on areas in which increased administrative flexibility could 

lead to improved TANF outcomes. Specifically, HHS held conversations 

with TANF officials from all states in response to the President’s February 

However, 

when TANF was reauthorized through the Deficit Reduction Act of 2005, 

this waiver authority was not included in the act.

 

14See TANF-ACF-PI-2005-06, Subject: Using Federal TANF and State Maintenance of 

Effort Funds for Families Affected by Hurricane Katrina and TANF-ACF-PI-2007-08, 

Subject: Using Federal TANF and State Maintenance of Effort Funds for Families in Areas 

Covered by a Federal or State Disaster Declaration. 

15S. 667, 109th Cong. §§ 114, 109 (2005).
 

Page 7 GAO-13-423T 

2011 Memorandum directing executive agencies to work closely with 

state, local, and tribal governments to identify administrative, regulatory, 

and legislative barriers in federally funded programs that prevent the 

efficient use of tax dollars to achieve results for constituents. Following 

these conversations, HHS documents show that six states expressed 

interest in TANF waivers, with five of those states specifically indicating 

their interest in waivers related to TANF work requirements, and the sixth 

asking about TANF waivers in general.16

Since HHS issued the July 12, 2012 Information Memorandum indicating 

the Secretary’s willingness to exercise section 1115 waiver authority 

related to TANF work requirements, HHS documents show that eight 

states have expressed interest in pursuing these waivers. As of 

September 6, 2012, no state had formally submitted a request for a 

waiver related to TANF work requirements to HHS.

In response, HHS officials 

generally indicated that the Department was in the process of reviewing 

its TANF waiver authority.

Chairman Reichert, Ranking Member Doggett, and Members of the 

Subcommittee, this concludes my statement. I would be happy to answer 

any questions you might have.

For questions about this testimony, please contact Kay E. Brown at (202) 

512-7215 or brownke@gao.gov. Contact points for our Offices of 

Congressional Relations and Public Affairs may be found on the last page 

of this statement. Individuals who made key contributions to this 

testimony include David Barish, James Bennett, Alex Galuten, Gale 

Harris, Kathy Leslie, and Almeta Spencer.

 

16HHS officials indicated that during the conversations, a major focus of state comments 

was state interest in various modifications to the TANF work requirements. Further, in 

follow-up comments submitted by states to HHS, 26 states expressed interest in various 

modifications to the TANF work requirements. This is consistent with the findings of our 

2010 report on TANF work requirements, in which we discussed challenges states had 

implementing the changes made to the TANF work requirements by the Deficit Reduction 

Act of 2005. See GAO, Temporary Assistance for Needy Families: Implications of Recent 

Legislative and Economic Changes for State Programs and Work Participation Rates, 

GAO-10-525 (Washington, D.C.: May 28, 2010). 

(131242)
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