This baseline is advantageous to New England states because most had record-high AFDC spending in FY94 or FY95. Second, the recent decline in welfare caseloads in New England is expected to continue in the near future, resulting in declining matching federal dollars if the funding were calculated under the old AFDC program. In FY95 and the first ten months of FY96, New England's monthly average caseload dropped 5 and 9 percent, respectively, in large part because of the improved economy and tougher state welfare regulations. Although block grants may provide the region's states with increased revenue in the short term, they are likely to be inadequate during a recession, when caseloads and spending grow. Congress has attempted to provide states with a modest cushion against economic recessions by establishing a contingency fund whereby, under limited circumstances, states can receive additional payments worth up to 20 percent of their block grant allocations.
Access is limited, however.
A state's unemployment rate for the most recent three months must equal or exceed 6.5 percent and be one-tenth higher than the state's unemployment rate in the comparable time period in either of the preceding two years. Food Stamp Trigger. It also tends to shut off during a sustained period of steady high unemployment - Congress did not intend to offer ongoing aid to states that characteristically have unusually high unemployment rates. One can debate whether 6.5 percent is the unemployment rate at which states need additional help. However, this can serve as a benchmark for assessing how the New England states would have fared had the unemployment trigger been in effect during the past 25 years, covering three recessions.