Drug Offenders: Various Factors May Limit the Impacts of Federal Laws That Provide for Denial of Selected Benefits
Published: 2005-09-26T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: Several provisions of federal law allow for or require certain federal benefits to be denied to individuals convicted of drug offenses in federal or state courts. These benefits include Temporary Assistance for Needy Families (TANF), food stamps, federally assisted housing, postsecondary education assistance, and some federal contracts and licenses. Given the sizable population of drug offenders in the United States, the number and the impacts of federal denial of benefit provisions may be particularly important if the operations of these provisions work at cross purposes with recent federal initiatives intended to ease prisoner reentry and foster prisoner reintegration into society. GAO analyzed (1) for selected years, the number and percentage of drug offenders that were estimated to be denied federal postsecondary education and federally assisted housing benefits and federal grants, contracts, and licenses and (2) the factors affecting whether drug offenders would have been eligible to receive TANF and food stamp benefits, but for their drug offense convictions, and for a recent year, the percentage of drug offenders released who would have been eligible to receive these benefits. Several agencies reviewed a draft of this report, and we incorporated the technical comments that some provided into the report where appropriate.
section_title: What GAO Found
paragraphs: For the years for which it obtained data, GAO estimates that relatively small percentages of applicants but thousands of persons were denied postsecondary education benefits, federally assisted housing, or selected licenses and contracts as a result of federal laws that provide for denying benefits to drug offenders. During academic year 2003-2004, about 41,000 applicants (or 0.3 percent of all applicants) were disqualified from receiving postsecondary education loans and grants because of drug convictions. For 2003, 13 of the largest public housing agencies in the nation reported that less than 6 percent of 9,249 lease terminations that occurred in these agencies were for reasons of drug-related criminal activities--such as illegal distribution or use of a controlled substance--and 15 large public housing agencies reported that about 5 percent of 29,459 applications for admission were denied admission for these reasons. From 1990 through the second quarter of 2004, judges in federal and state courts were reported to have imposed sanctions to deny benefits such as federal licenses, grants, and contracts to about 600 convicted drug offenders per year. Various factors affect which convicted drug felons are eligible to receive TANF or food stamps. This is because state of residence, income, and family situation all play a role in determining eligibility. Federal law mandates that convicted drug felons face a lifetime ban on receipt of TANF and food stamps unless states pass laws to exempt some or all convicted drug felons in their state from the ban. At the time of GAO's review, 32 states had laws exempting some or all convicted drug felons from the ban on TANF, and 35 states had laws modifying the federal ban on food stamps. Because of the eligibility requirements associated with receiving these benefits, only those convicted drug felons who, but for their conviction, would have been eligible to receive the benefits could be affected by the federal bans. For example, TANF eligibility criteria include requirements that an applicant have custodial care of a child and that income be below state-determined eligibility thresholds. Available data for 14 of 18 states that fully implemented the ban on TANF indicate that about 15 percent of drug offenders released from prison in 2001 met key eligibility requirements and constitute the pool of potentially affected drug felons. Proportionally more female drug felons than males may be affected by the ban, as about 27 percent of female and 15 percent of male drug offenders released from prison in 2001 could be affected.

section_title: Letter
paragraphs: During recent years, several hundred thousand persons per year in the  United States were convicted in federal and state courts of drug offenses  such as felony drug trafficking and misdemeanor drug possession.  Provisions of federal law allow that these convictions may render these  individuals ineligible to receive selected federal benefits. The benefits  include Temporary Assistance for Needy Families (TANF), food stamps,  federally assisted housing, postsecondary education grants and loans, and  certain federal contracts and licenses. Depending upon the federal benefit,  drug offenders may be prohibited from receiving assistance for periods  that range from 1 year to life.
You asked us to assess the impacts of these provisions. An important first  step in assessing the impacts is to determine how many people could be  affected by these provisions. The number and the impacts of federal denial  of benefit provisions may be particularly important if the operations of  these provisions work at cross purposes with recent federal initiatives  intended to ease prisoner reentry and foster prisoner reintegration into  society. This report analyzes two interrelated questions about the number  or percentage of drug offenders that could be affected by the provisions:  (1) In specific years, how many drug offenders were estimated to be  denied federal postsecondary education benefits, federally assisted  housing, and selected grants, contracts, and licenses? (2) What factors  affect whether drug offenders would have been eligible to receive TANF  and food stamp benefits, but for their drug offense convictions, and for a  recent year, what percentage would have been eligible to receive these  benefits?
You also asked us to address the impact of federal benefit denial laws on  racial minorities and the long-run consequences of having benefits denied.  The final sections of appendices III, IV, and V in this report include  discussions of the data limitations related to estimating the impacts on  racial minorities. Where information was available, we also identify in the  appendices some of the possible long-run consequences of denial of  benefits.
To estimate the extent to which drug offenders were denied federal  postsecondary education, federally assisted housing benefits, and selected  federal licenses, grants, and contracts, we obtained and analyzed data  from several agencies. We analyzed Department of Education data on  persons who applied for federal postsecondary education assistance such  as Pell Grants and who reported that they had convictions that prohibited  them from receiving federal postsecondary education benefits. We  analyzed Bureau of Justice Statistics (BJS) data on the educational  attainment of a nationally representative sample of drug offenders on  probation. From officials at 17 large public housing agencies (PHA) we  obtained information about their experiences in denying federally assisted  housing benefits to persons because of their drug-related criminal  activities. We analyzed data on evictions and denials of admission into  public housing that the Department of Housing and Urban Development  (HUD) obtains from PHAs that manage units in the Public Housing  Program. From the Bureau of Justice Assistance (BJA) we obtained data  on persons reported to be denied selected federal licenses, grants, and  contracts by federal and state judges.
To estimate the extent to which convicted drug felons would have been  eligible to receive TANF and food stamp benefits apart from their felony  drug offense conviction, we obtained and analyzed the most recently  available data compiled by BJS on the familial and economic  characteristics of drug offenders in prison. We analyzed these data to  estimate the number of drug offenders that met selected eligibility criteria  to receive these benefits, and we applied our estimates from the BJS  prisoner data to data on drug offenders released from prison in 14 of 18  states that fully implemented the federal bans on TANF and food stamps.  Because of the limited data on persons actually denied TANF and food  stamp benefits, we provide rough estimates of the proportions of drug  offenders that met selected eligibility criteria to receive these benefits  rather than of the number of such offenders actually denied these benefits.
To identify the various factors that contributed to our estimates of those  potentially affected by federal provisions that provide for denial of  benefits, we interviewed officials from the federal agencies that administer  the federal benefits that may be denied, researchers who have studied the  denial of federal benefits and related issues, and officials of various  associations who represent PHAs, which are the agencies that manage  federally assisted benefits. We also reviewed published studies on the  denial of federal benefits.
We assessed the reliability of the data that we used in preparing this report  by, as appropriate, interviewing agency officials about their data,  reviewing documentation about the data sets, and conducting electronic  tests. We used only the portions of the data that we found to be  sufficiently reliable for our purposes in this report. We provide a more  detailed discussion of our objectives, scope, and general methodology in  appendix I. In appendices II through V, we further discuss our  methodologies for each of the federal benefits that we reviewed.
We conducted our work from March 2004 through July 2005 in accordance  with generally accepted government auditing standards.
subsections: section_title: Background
paragraphs: Selected provisions of federal law explicitly prohibit specific categories of  drug offenders from receiving certain federal benefits for specified  periods. Table 1 identifies key provisions of federal law that provide for  denial of benefits specifically to drug offenders and the corresponding  benefits that may or must be denied to drug offenders.
Except for federal licenses, procurement contracts, and grants under  Denial of Federal Benefits Program, the benefits that may or must be  denied are benefits that are generally provided to low-income individuals  and families. TANF, food stamps, federally assisted housing, and Pell  Grants are low-income programs. The Denial of Federal Benefits Program,  established under Section 5301 of the Anti-Drug Abuse Act of 1988, as  amended, provides that federal and state court judges may deny all or  some of certain specified federal benefits to individuals convicted of drug  trafficking or drug possession offenses involving controlled substances.  Additional details on each of the programs may be found in appendices II,  III, IV, and V.
The provisions differ on key elements. For example, they establish  different classes of drug offenders that may or must be denied benefits,  and they provide for different periods that drug offenders are rendered  ineligible to receive a benefit and whether or not benefits can be restored.  Some of the provisions allow that drug offenders may become eligible for  benefits upon completing a recognized drug treatment program.
Provisions established by the Personal Responsibility and Work  Opportunity Reconciliation Act of 1996 (PRWORA), as amended, which  govern the TANF and food stamp programs, provide that benefits must be  denied to persons convicted of a state or federal felony drug offense that  involves the possession, use, or distribution of a controlled substance that  occurred after August 22, 1996, the effective date of these provisions.  Students become ineligible to receive federal postsecondary education  benefits upon a conviction of either a misdemeanor or a felony controlled  substances offense. Loss of federally assisted housing benefits can occur if  individuals, relatives in their household, or guests under a tenant’s control  engage in drug-related criminal activity, regardless of whether the activity  resulted in a conviction. Local public housing authorities, which  administer federally assisted housing benefits, have discretion in  determining the behaviors that could lead to loss of certain federal  housing benefits. Under the Denial of Federal Benefits Program, judges in  federal and state courts may deny a range of federal licenses, contracts,  and grants to persons convicted of controlled substances drug trafficking  and drug possession offenses.
The period of ineligibility to receive benefits varies. Under PRWORA, as  amended, unless states enact laws that exempt convicted drug offenders  in their state from the federal ban, TANF and food stamp benefits are  forfeited for life for those convicted of disqualifying drug offenses. State  laws may also result in a shorter period of denial of these benefits.  Students are disqualified from receiving federal postsecondary education  benefits for varying periods depending on the number and type of  disqualifying drug offense convictions. A first conviction for possession of  a controlled substance, for example, results in a 1-year period of  ineligibility, while a first conviction for sale of controlled substance results  in a 2-year period of ineligibility. Upon subsequent convictions, the period  of ineligibility can extend indefinitely.
Federally assisted housing benefits may also be denied for varying periods  of time, depending upon the number and types of drug-related criminal  activities. The minimum loss of benefit is 3 years in certain circumstances,  and the maximum is a lifetime ban. For example, for persons convicted of  certain methamphetamine offenses, the ban is mandatory and for life.  Under the Denial of Federal Benefits Program, the denial of certain other  types of benefits by judges, such as federal grants and contracts, can range  from 1 year to life depending on the type of offense and number of  convictions.
In some cases, the period of benefit ineligibility may be shortened if  offenders complete drug treatment. For example, students may have their  postsecondary education benefits restored if they satisfactorily complete a  drug treatment program that satisfies certain criteria and includes two  unannounced drug tests. Under the Denial of Federal Benefits Program,  the denial of benefits penalties may, for example, be waived if a person  successfully completes a drug treatment program. Other than offenders  who were convicted of methamphetamine offenses, drug offenders that  successfully complete drug treatment may receive federally assisted  housing benefits prior to the end of their period of ineligibility. In states  that have passed laws so specifying, drug offenders may shorten the  period of ineligibility for TANF and food stamp benefits by completing  drug treatment. (See table 2.)
The legislative history of these provisions is silent as to whether they were  intended to do more than provide for denying federal benefits to drug  offenders, such as deterring drug offenders from committing future  criminal acts. For example, our 1992 report indicated that in the floor  debates over the Denial of Federal Benefits Program, some members of  Congress expressed the opinion that even casual drug use should result in  serious consequences, such as the loss of federal benefits. With respect to  prohibiting drug offenders from public housing, congressional findings  made in 1990 and amended in 1998 address the extent of drug-related  criminal activities in public housing and the federal government’s duty to  provide public and other federally assisted low-income housing that is  decent, safe, and free from illegal drugs.
subsections: section_title: How Benefit Eligibility Requirements May Affect whether a Drug Offender Loses Benefits
paragraphs: TANF, food stamps, federally assisted housing, and Pell Grants are means- tested benefits. To receive the benefits, individuals must meet certain  eligibility criteria. These criteria vary with the benefit. For instance, states  determine maximum earned income limits for TANF, but to receive food  stamps, the federal poverty guidelines are generally used in determining  eligibility. To receive federally assisted housing, local area median income  is used. Additionally, most adults eligible for TANF and some adults  eligible for food stamps must meet specified work requirements to  participate in the programs. Table 3 summarizes the general eligibility  requirements for the federal benefits discussed in this report and identifies  the federal, state, and local agencies responsible for administering the  programs.
Not all persons who meet the general eligibility requirements to receive  federal benefits participate in the respective programs. Our recent study  on programs that aim to support needy families and individuals shows that  the portion of those eligible to receive the benefits that actually enrolled in  the programs varied among programs. Among families eligible to  participate in TANF in 2001, between 46 percent and 50 percent were  estimated to be participating in the program. For food stamps in 2001,  between 46 percent and 48 percent of eligible households were estimated  to participate in the program. For federally assisted housing, between 13  percent and 15 percent of eligible households in 1999 were estimated to be  covered by the Housing Choice Voucher (HCV) Program and between 7  percent and 9 percent of eligible households in 1999 were estimated to be  covered by the Public Housing Program. Further, the Department of  Education reports that among all applicants for federal postsecondary  education assistance in academic year 2001-2002, about 77 percent of the  applicants that were eligible to receive Pell Grants applied for and  received them.
Drug offenders would be directly affected by the federal provisions that  allow for denial of low-income federal benefits when, apart from their  disqualifying drug offense, they would have qualified to receive the  benefits. For example, if a drug offender is not in a financially needy  family and living with her dependent child, the drug offender would not be  eligible for TANF benefits aside from the drug offense conviction. To be  directly affected by the ban on food stamps, a drug offender would have  had to meet income tests and work requirements, unless the work  requirements are, under certain specified circumstances, identified as not  applicable by federal food stamp laws; otherwise, the offender’s  ineligibility to receive the benefit would disqualify him, as opposed to his  drug offense. Because the ban on the receipt of TANF and food stamps is  for life, an offender who is not otherwise eligible to receive the benefits at  one point in time might become otherwise eligible to receive the benefits  at a later point in time and at that time be affected by the provisions of  PRWORA.
To be otherwise eligible to receive federal postsecondary education  assistance, a person convicted of a disqualifying drug offense would, at a  minimum, have to be enrolled in or accepted at an institution of higher  education, as well as meet certain income tests. To be otherwise eligible  for federally assisted housing benefits, a person would have to meet  income tests.
section_title: Estimated Number of Drug Offenders Denied Federal Postsecondary Education, Housing, and Certain Contracts and Grants Varies by Type of Benefit
paragraphs: We estimated that among applicants for federal postsecondary education  assistance, drug offenders constituted less than 0.5 percent on average of  all applicants for assistance during recent years. In general, the education  attainment level of drug offenders is lower than that of the general  population, and this lower level affects drug offenders’ eligibility for  federal postsecondary assistance. Among selected large PHAs that  reported denying applicants admission into public housing during 2003,  less than 5 percent of applicants were denied admission because of drug- related criminal activities. PHAs have discretion in developing policies to  deny offenders for drug-related criminal activities. Federal and state court  sentencing judges were reported to impose sanctions to federal benefits to  fewer than 600 convicted drug offenders in 2002 and 2003, or less than 0.2  percent of felony drug convictions on average.
subsections: section_title: An Estimated 17,000 to 41,000 Drug Offenders Lost Selected Federal Postsecondary Education Benefits in Selected Years
paragraphs: According to Department of Education data on applicants for federal  postsecondary education assistance for the academic years from 2001- 2002 through 2003-2004, less than 0.5 percent on average of the roughly 11  million to 13 million applicants for assistance reported on their  applications that they had a drug offense conviction that made them  ineligible to receive education assistance in the year in which they applied.  These numbers do not take into account the persons who did not apply for  federal postsecondary education assistance because they thought that  their prior drug convictions would preclude them from receiving  assistance or any applicant who falsified information about drug  convictions. Using these data and Department of Education data on  applicants that received assistance for the academic years 2001-2002  through 2003-2004, we estimated that between 17,000 and 20,000  applicants per year would have been denied Pell Grants, and between  29,000 and 41,000 would have been denied student loans if the applicants  who self-certified to a disqualifying drug offense were eligible to receive  the benefits in the same proportion as the other applicants. (See app. III  for details on our methods of estimating these figures.)
In general, the educational attainment levels of persons convicted of drug  offenses is less than that of persons in the general population. This results  in proportionately fewer persons eligible for these education benefits than  in the general population. Our analysis of data from the only national  survey of adults on probation that also reports on their educational  attainment indicates that among drug offenders on probation during 1995,  less than half had completed high school or obtained a general equivalency  degree (GED)—prerequisites for enrolling in a postsecondary institution.  By comparison, according to a Bureau of Justice Statistics report, about 18  percent of adults in the general population had less than a high school  degree. More recent data from the U.S. Sentencing Commission on roughly  26,000 drug offenders sentenced federally during 2003 indicate that half of  them had less than a high school degree, about one-third had graduated  from high school, and about 18 percent had at least some college. In  addition, our analysis of BJS data on drug offenders released from prisons  in 23 states during 2001 indicate that about 57 percent of these drug  offenders had not completed high school by the time they were admitted  into prison; about 36 percent had completed high school or obtained a  GED as their highest level of education completed; and the remainder had  completed some postsecondary education.
section_title: In Selected PHAs Less Than 6 Percent of Residents and Applicants Were Denied Federally Assisted Housing during 2003 because of Drug- Related Criminal Activities
paragraphs: We obtained data from 17 of the largest PHAs in the nation on the  decisions that they made to deny federally assisted housing benefits to  residents or applicants during 2003. Thirteen of the 17 PHAs reported  data on both (1) the number of leases in the Public Housing Program units  that they manage that ended during 2003 and (2) the number of leases that  were terminated for reasons of drug-related criminal activities. These 13  PHAs reported terminating leases of 520 tenants in the Public Housing  Program because of drug-related criminal activities. The termination of a  lease is the first step in evicting tenants from public housing. Tenants  whose leases were terminated for reasons of drug-related criminal  activities constituted less than 6 percent of the 9,249 leases that were  terminated in these 13 PHAs during 2003. Among these PHAs, the  percentage of terminations of leases for reasons of drug-related criminal  activities ranged from 0 percent to less than 40 percent. These PHAs also  reported that the total number of lease terminations in 2003 and the  volume of denials for drug-related activities were generally comparable  with similar numbers for the 3 prior years. (See app. IV for data for each  PHA that responded to our request for information.)
Fifteen PHAs acted on 29,459 applications for admission into the Public  Housing Program during 2003. Among these applicants seeking residency,  we estimated that less than 5 percent were denied admission because of  their drug-related criminal activities. The PHAs also reported that they  acted on similar numbers of applicants and made similar numbers of  denial decisions in the prior 3 years. Table 4 shows the data on lease  terminations and denials of admission in two federally assisted housing  programs.
We also obtained and analyzed data from HUD on the number of evictions  and denials of admission into public housing during fiscal years 2002 and  2003 that occurred for reasons of criminal activity, of which drug-related  criminal activity is a subset. More than 3,000 PHAs reported to HUD that in  each of these years there were about 9,000 evictions for reasons related to  criminal activity and about 49,000 denials of admission for reasons of  criminal activity. As a percentage of units managed by these PHAs,  evictions for reasons of criminal activity in each of these years amounted  to less than 1 percent of units managed, and denials of admission  amounted to about 4 percent of units managed. Evictions and denials for  reasons of drug-related criminal activities would have to be equal to or,  much more likely, less than these percentages.
On the basis of data that 9 PHAs were able to report about terminating  participation in the HCV Program during 2003, we estimated that less than  2 percent of the decisions to terminate assistance in the HCV program (of  the roughly 12,700 such decisions) were for reasons of drug-related  criminal activities. In addition, 9 PHAs reported that they acted on 21,996  applications for admission into the HCV Program and that less than 1.5  percent of applicants were denied admission for reasons of drug-related  criminal activities.
section_title: Discretionary Authority May Allow Some to Receive Housing Benefits, but Supply Limitations May Be a Significant Barrier
paragraphs: Local PHAs that administer federally assisted housing benefits have  discretion in determining whether current tenants or applicants for  assistance have engaged in drug-related criminal activities that disqualify  them from receiving housing benefits. HUD requires PHAs to develop  guidelines for evicting from or denying admittance into federally assisted  housing to individuals who engage in drug-related criminal activity. A  November 2000 HUD study on the administration of the HCV Program  described the variation in PHA policies on denying housing to persons  who engaged in drug-related criminal activities. HUD concluded that  because of the policy differences, some PHAs could deny applicants who  could be admitted by others. For example, some PHAs consider only  convictions in determining whether applicants qualify for housing benefits,  while others look at both arrests and convictions. Some look for a pattern  of drug-related criminal behavior, while others look for evidence that any  drug-related criminal activities occurred. In addition, among PHAs, the  period of ineligibility for assistance arising from a prior eviction from  federally assisted housing because of drug-related criminal activities  ranged from 3 to 5 years. (See app. IV for a summary of selected PHA  policies.)
Any imbalance between the supply of and demand for federally assisted  housing may also affect whether drug offenders are denied access to this  benefit. The stock of available federally assisted housing units in the  Public Housing Program is generally insufficient to meet demand. PHAs  may have long waiting lists, up to 10 years in some cases, for access to  federally assisted housing. As PHAs generally place new applicants at the  end of waiting lists, a drug offender who might be disqualified from  federally assisted housing but who applies for housing assistance could go  to the end of a PHA’s waiting list. Until that applicant moved to the top of  the waiting list, the limited supply of federally assisted housing, and not  necessarily a drug offense conviction, would effectively deny the applicant  access to the benefit.
section_title: Limited Use of the Denial of Federal Benefits Program Sanctions
paragraphs: Between 1990 and the second quarter of 2004, BJA received reports from  state and federal courts that 8,298 offenders were sanctioned under the  Denial of Federal Benefits Program in federal and state courts. This  amounted to an average of fewer than 600 offenders per year. The Denial  of Federal Benefits Program provides judges with a sentencing option to  deny federal benefits such as grants, contracts, and licenses. About 62  percent of the cases reported to be sanctioned under the Denial of Federal  Benefits Program occurred in federal courts, and the remaining 38 percent  occurred in state courts. For recent years (2002 and 2003), BJA reported  that fewer than 600 persons were denied federal benefits under the  program. In 2002, there were more than 360,000 drug felony convictions  nationwide. On average, less than 0.2 percent of these convicted drug  felons were sanctioned under this program.
According to the BJA data, state court judges in 7 states have imposed the  sanction, and state court judges in Texas accounted for 39 percent of all  cases in which drug offenders were reportedly denied benefits under this  program by state court judges. Federal judges in judicial districts in 26  states had reportedly imposed denial of benefits sanctions, and federal  judges in Texas accounted for 21 percent of the cases in which federal  judges reportedly denied benefits. The pattern of use of sanctions under  this program, with substantially more use in some jurisdictions than in  others, may indicate that there are drug offenders in some locations who  could have received the sanction but did not. (See app. V for more  information about this program.)
We previously reported on the relatively limited use of this sanction. We  reported then that many offenders who could be denied access to federal  benefits would also be sentenced to prison terms that exceed the benefit  ineligibility period; therefore, upon release from prison, the offenders  would not necessarily have benefits to lose. BJA officials reported that as  of 2004, about 2,000 convicted drug offenders were still under sanction  under the Denial of Benefits Program, as the period of denial had expired  for the other sanctioned offenders.
section_title: State Exemptions to the Federal Bans on TANF and Food Stamps and Other Factors Affect the Percentage of Drug Offenders That Would Have Been Eligible to Receive the Benefits
paragraphs: Most states have acted on the discretionary authority provided them under  federal law to enact legislation that exempts some or all convicted drug  felons in their states from the federal bans on their receipt of TANF and  food stamps. That is, these state laws allow that convicted drug felons may  not be banned for life from receiving TANF and food stamps provided they  meet certain conditions. For states that had not modified the federal ban  on TANF, we estimated that about 15 percent of all offenders and 27  percent of female offenders released from prison during 2001 would have  met selected eligibility requirements and would therefore potentially be  affected by the ban. We also estimated that among drug offenders released  from prison during 2001 in states that had not modified the federal ban on  food stamps about a quarter were custodial parents whose reported  income was below federal poverty thresholds for food stamps. While food  stamps are not limited to custodial parents, and the ban could affect other  drug offenders, we limited our analysis to this group.
subsections: section_title: Eighteen States Fully Implement the Federal Ban on TANF, as the Remainder Have Enacted Legislation to Exempt Some or All Convicted Drug Felons
paragraphs: A total of 32 states have enacted laws that exempt all or some convicted  drug felons from the federal ban on TANF benefits. Of these states, 9 have  enacted laws that exempt all convicted drug felons from the federal ban,  and these persons may receive TANF benefits provided that they meet  their state’s general eligibility criteria. Another 23 states have passed laws  that exempt some drug felons from the TANF ban. The modifications  allow that some convicted drug felons may receive benefits and generally  fall into any of three categories: (1) Some states permit felons convicted of  drug use or simple possession offenses to continue to receive TANF  benefits but deny them to felons convicted of drug sales, distribution, or  trafficking offenses; (2) some states allow convicted felons to receive  TANF benefits only after a period of time has passed; and (3) some states  allow convicted drug felons to receive TANF benefits conditioned upon  their compliance with drug treatment, drug testing, or other conditions.  (See app. II for the status of states’ exemptions to the TANF ban.)
Using state-level data on drug arrests as a proxy for state-level data on  drug convictions, we estimated that the 9 states that completely opted out  of the TANF ban and exempted all convicted drug felons from the ban  accounted for about 10 percent of drug arrests nationally in 2002. The 23  states whose exemptions modified the TANF ban accounted for about 45  percent of drug arrests nationally. For these states with various  exemptions, it is difficult to determine to which drug felons the ban might  apply, as participation in the program is contingent upon a felon’s  behavior (such as abiding with conditions of probation or parole  supervision, or participating in drug treatment). Finally, the 18 states that  fully implemented the TANF ban accounted for about 45 percent of all  drug arrests nationwide.
section_title: In States That Fully Implement the Ban on TANF, about 15 Percent of All Drug Offenders Released from Prison in 2001 Were Estimated to Meet TANF Eligibility Criteria
paragraphs: Using Bureau of Justice Statistics survey data on the family and economic  characteristics of drug offenders in prison and state-level data on the  number of drug offenders released from prison during 2001 in 14 of the 18  states that fully implement the ban on TANF, we estimated that about 15  percent of those released from prison were parents of minor children,  lived with their children, and had earned income below the maximum  levels permitted by their states of residence. That is, but for the ban, they  may have been eligible to receive TANF benefits. We estimated that the  majority of drug felons—who are single males and not custodial parents— did not meet these TANF eligibility requirements and would therefore not  have been qualified to receive the benefit even in the absence of the  provisions of PRWORA. (See app. II for additional information about the  methods used to estimate these quantities.)
Female drug offenders released from prison in the 14 states constituted  about 13 percent of drug offenders released from prison in 2001. We  estimated that between 25 percent and 28 percent of these female  offenders were parents of minor children who lived with their children and  whose incomes were below state thresholds, and therefore stood to lose  TANF benefits. This percentage among female drug offenders released  from prison is about twice that for males. From the available data, we  estimated that less than 15 percent of male prisoners were parents who  lived with their children and had earned incomes that would qualify them  to receive TANF benefits.
Other factors, which we could not take into account to estimate the  percentages of drug offenders that could be eligible to receive TANF  benefits, include citizenship status and total family income. Noncitizens  with fewer than 5 years of residence in the United States are generally  ineligible to receive TANF. Several of the states for which we obtained  data on drug offenders released from prison have relatively large  noncitizen populations. Therefore, among those drug offenders that we  estimated could have been eligible to receive TANF benefits might be  some ineligible noncitizens. In addition, the data that we used to estimate  whether drug offenders met state income eligibility requirements included  individual income rather than total family income. It is possible that some  prisoners would join family units with incomes above state TANF  eligibility earned income limits and would thus be disqualified for benefits.
Among the drug offenders released from prison during 2001, the  percentage that may be affected by the TANF ban at any time during their  lifetimes would be greater than our estimate of those initially affected.  This is because at a later date some of these offenders may meet the  general eligibility criteria for receiving benefits. Thus, the percentage ever  affected by the bans would grow over time.
Because of data availability, our estimates focus on convicted drug felons  who were in prison. We do not have data to assess the effect of the TANF  ban on drug felons who received probation or who were sentenced to time  in local jails. According to BJS data, nationwide, about one-third of  convicted drug felons are sentenced to probation. Moreover, our estimates  apply to the states that fully implemented the ban on TANF. Because of  complexities associated with state exemptions to the federal ban and the  lack of sufficiently detailed data, we cannot provide an estimate of the  percentage of convicted drug offenders who could be affected by the ban  in the 23 states that modified the TANF ban. We note, however, that state  modifications to the ban may allow convicted drug felons to participate in  TANF if they abide by the conditions set in the state exemptions (such as  abide by conditions of parole or probation supervision or participate in  drug treatment). In these states, unlike in the states that fully implement  the federal ban, the post-conviction behavior of offenders would help to  determine whether they could receive the benefit. Other state  modifications allow drug offenders to receive TANF benefits at some point  in the future (such as after completing drug treatment or receiving a  sufficient number of negative drug test results). In states that require that  drug felons wait before becoming eligible to participate in TANF, the  federal ban is in effect until the waiting period ends. We would therefore  expect estimates of the percentage affected during the waiting period to  be similar to the estimates of the percentage affected in the states that  fully implemented the federal ban.
section_title: In States That Fully Implement the Ban on Food Stamps, About One- Fourth of Drug Offenders Released from Prison in 2001 Were Parents Who Could Have Been Eligible for Food Stamps
paragraphs: At the time of our review, 15 states fully implemented the federal ban on  food stamp benefits to convicted drug felons, and 35 states had passed  laws to exempt all or some convicted drug felons in their own states from  the federal ban on food stamps. Of the 35 states with exemptions, 14 states  exempt all convicted drug felons from the food stamp ban, and 21 have  laws that exempt some convicted drug felons from the food stamp ban  provided that they meet certain conditions. In the 21 states that modified  the food stamp ban, the modifications are similar to those for TANF and  generally include (1) exempting persons convicted of drug possession  from the ban, while retaining it for persons convicted of drug sales,  distribution, or trafficking; (2) requiring a waiting period to pass before  eligibility is restored; and (3) conditioning food stamp eligibility upon  compliance with drug treatment, drug testing, or other conditions. (See  app. II for the status of states’ exemptions to the food stamps ban.)
States’ decisions to exempt all or some convicted drug felons in their  states from the ban on food stamps affect the proportion of drug felons  that can be affected by the ban. Using the state-level drug arrest data as  the proxy for felony drug convictions (as we did for TANF), we find that  the 15 states that fully implemented the ban on food stamps accounted for  about 22 percent of all drug arrests nationally. Using data from the BJS  inmate survey on the family and economic characteristics of drug  offenders in prison and state-level data on the number of drug offenders  released from prison during 2001 in 12 of the 15 states that fully  implemented the ban on food stamps, we estimated that about 23 percent  of those released from prison were parents of minor children whose  incomes were below the federal poverty guidelines. Among male drug  offenders, we estimated that about 22 percent met these conditions, while  among female drug offenders, we estimated that about 36 percent did. We  are unable to provide an estimate of the percentage of drug offenders that  could be eligible to receive food stamps as able-bodied adults without  dependent children. According to USDA, in 2003, this class of food stamp  recipients constituted about 2.5 percent of food stamp recipients  nationwide.  Food stamps are not limited to custodial parents. However,  we limited our assessment to custodial parents because of data  limitations.
Because the denial of food stamps is a lifetime ban, the number of drug  offenders affected by the ban will increase over time, as additional  convicted drug felons are released from prison.
Also, as with the TANF estimates, data limitations precluded our providing  estimates for the felony drug offenders that were sentenced to probation  in 2001 or for the states that modified the federal ban.
section_title: Concluding Observations
paragraphs: A complex array of provisions of federal law allow or require federal  benefits be denied to different classes of drug offenders. There is also a  good deal of discretion allowed in implementing these laws that can  exempt certain drug offenders from their application. Our estimates  indicate that denial of benefit laws potentially affect relatively small  percentages of drug offenders, although the numbers potentially affected  in given years may be large. There are a number of reasons why the  percentages affected may be relatively small. First, large numbers of drug  offenders would not be eligible for these benefits regardless of their drug  offender status. For example, those who lack a high school diploma are  ineligible for postsecondary educational loans or grants, and many do not  meet eligibility requirement for TANF and food stamps. Also, in the case of  TANF and food stamps, the majority of states have used their discretion to  either partially or fully lift the ban on these benefits for certain drug  offenders.
It is important to note that although the overall numbers of drug offenders  that could be affected by the TANF and food stamp bans are relatively  small in comparison with the numbers of drug offenders, our estimates  suggest that the effects of the bans disproportionately fall on female  offenders. This is because they are more likely to be custodial parents with  low incomes and thus otherwise eligible for the benefits.
section_title: Agency Comments and Our Evaluation
paragraphs: We provided a draft of this report to the Attorney General; the Secretaries  of the Departments of Education, Agriculture, and Housing and Urban  Development; the Assistant Secretary of the Administration for Children  and Families; the Director of the Office of National Drug Control Policy;  the Research Director of the United States Sentencing Commission; and  the Director of the Administrative Office of the United States Courts for  their review and comment.  We received technical comments from the  Departments of Justice, Agriculture, and Education, and from the United  States Sentencing Commission and Administrative Office of the United  States Courts, which we incorporated into the report where appropriate.
We are sending copies of this report to the Attorney General; the  Secretaries of the Departments of Education, Health and Human Services,  Agriculture, and Housing and Urban Development; the Director of the  Office of National Drug Control Policy; the Research Director of the  United States Sentencing Commission, and the Director of the  Administrative Office of the United States Courts. We will also make  copies available to others upon request. In addition, the report will be  available at no charge on GAO’s Web site at http://www.gao.gov.
If you or your staff have any questions concerning this report, please  contact me at (202) 512-8777 or by e-mail at Ekstrandl@gao.gov. Contact  points for our Offices of Congressional Relations and Public Affairs may  be found on the last page of this report. GAO staff who made major  contributors to this report are listed in appendix VI.
section_title: Appendix I: Objectives, Scope, and Methodology
paragraphs: Federal law provides that certain drug offenders may or must be denied  selected federal benefits, such as Temporary Assistance for Needy  Families (TANF), food stamps, federally assisted housing, postsecondary  education grants and loans, and certain federal contracts and licenses. Our  objectives were to analyze and report on two interrelated questions about  the number or percentage of drug offenders that could be affected by the  provisions: (1) In specific years, how many drug offenders were estimated  to be denied federal postsecondary education benefits, federally assisted  housing, and selected grants, contracts, and licenses? (2) What factors  affect whether drug offenders would have been eligible to receive TANF  and food stamp benefits, but for their drug offense convictions, and for a  recent year, what percentage would have been eligible to receive these  benefits?
In addition, we were asked to address the impact of federal benefit denial  laws on minorities and the long-term consequences of denying federal  benefits on the drug offender population and their families. Because of  severe data limitations, we were unable to provide a detailed response to  this matter. The final section of appendixes II, III, IV, and V in this report  include discussions of the data limitations that precluded us from  estimating the impacts on minorities. Where information was available, we  also identify in the appendices some of the possible long-run  consequences of denial of benefits.
We limited our analysis of federal laws to those that explicitly included  provisions that allowed for or required the denial of federal benefits to  drug offenders. We excluded other provisions that provide for denial of  benefits to all offenders, of which drug offenders are a subset. We also  excluded from our analysis provisions that applied to offenders only while  they are incarcerated and provisions that applied to fugitive felons. Other  federal laws relating to drug offenders but not within the scope of our  review include provisions such as those making a person ineligible for  certain types of employment, denying the use of certain tax credits, and  restricting the ability to conduct certain firearms transactions.  Further,  because of the limited data available on persons actually denied federal  benefits, we provide rough estimates of either the number or the  percentage of drug offenders affected by the relevant provisions. We  provide an overview of these methodologies below but we discuss the  specifics of our methodologies for analyzing and estimating the impacts of  denying specific federal benefits in appendices II through V.
We assessed the reliability of the data that we used in preparing this report  by, as appropriate, interviewing agency officials about their data,  reviewing documentation about the data sets, and conducting electronic  tests. We used only the portions of the data that we found to be  sufficiently reliable for our purposes in this report.
We conducted our work primarily in Washington, D.C., at the headquarters  of five federal agencies—the Departments of Justice (DOJ), Agriculture  (USDA), Housing and Urban Development (HUD), Education (ED), and  Health and Human Services (HHS)—responsible for administering the  denial of federal benefit laws. We also conducted work at the Office for  National Drug Control Policy (ONDCP)—which has responsibilities for  national drug control policy—the Administrative Office for United States  Courts (AOUSC)—which provides guidance to the courts for the  implementation of statutory requirements—and the United States  Sentencing Commission (USSC)—which has responsibilities for  monitoring federal sentencing outcomes.
subsections: section_title: Assessing How Many Drug Offenders Were Estimated to Be Denied Federal Postsecondary Education and Federally Assisted Housing Benefits and Certain Grants and Contracts
paragraphs: To estimate how many or what percentage of drug offenders were  reported to be denied federal postsecondary education and federally  assisted housing benefits and certain grants and contracts under the  Denial of Federal Benefits Program, we obtained and analyzed data from  agency officials. From ED, we obtained data for several years on the  number of applicants using the Free Application for Federal Student Aid  (FAFSA), the number of these who reported a disqualifying drug offense  conviction, the number eligible for Pell Grants, and the number receiving  Pell Grants and student loans. We analyzed these data to generate our  estimates of the number of those that reported disqualifying drug offenses  that would have been eligible to receive Pell Grants and student loans. We  also obtained Bureau of Justice Statistics (BJS) data that reported on the  educational attainment of nationally representative sample of offenders on  probation. We used these data, along with USSC data on sentenced drug  offenders and BJS data on drug offenders released from prison, to assess  the education levels of drug offenders. To identify factors that could  contribute to the number of drug offenders denied federal postsecondary  education benefits, we interviewed officials at ED about federal  regulations, guidance, and rulings pertaining to the eligibility to receive  benefits. Appendix III describes in more detail our methods for estimating  the education of those denied education benefits.
From a nonprobability sample of some of the largest public housing  agencies (PHA) in the United States, we obtained information about  reported actions taken in 2003 in these PHAs to deny persons federally  assisted housing benefits for reasons of drug-related criminal activities.
We selected large agencies because of the volume of actions that they take  in a given year and to provide indications of the range of outcomes in  PHAs in different settings with different populations. We also obtained and  analyzed data from HUD on persons reportedly evicted from or denied  admission into public housing for reasons of criminal activities. From  selected PHAs, we obtained, analyzed, and compared termination and  admissions policies and procedures used during 2003 or 2004 to deny  federally assisted housing to persons involved in drug-related criminal  activities. We also spoke with staff from selected research organizations,  national associations, and PHAs to review the eligibility criteria to receive  federal benefits. Appendix IV describes our methods for assessing denials  of federally assisted housing.
From the Bureau of Justice Assistance (BJA), we obtained data on drug  offenders reported to have been denied federal benefits under the Denial  of Federal Benefits Program. We spoke with officials at BJA about the  current operations and plans to enhance the program, and we interviewed  officials from USSC and AOUSC about the operations of this program. We  also interviewed ONDCP officials about the array of federal provisions  that provide for denial of federal benefits and federal programs that  provide for drug treatment for drug offenders. Appendix V describes our  methodology for analyzing the Denial of Federal Benefits Program.
section_title: Estimating the Percentage of Convicted Drug Felons That Would Have Been Eligible to Receive TANF or Food Stamps and the Factors Contributing to These Estimates
paragraphs: Data limitations concerning the actual number of persons denied TANF  and food stamp benefits required us to develop estimates of the drug  offenders that could be denied these benefits in that they had  characteristics that would have allowed them to qualify to receive the  benefits except for their drug offense convictions. To determine the extent  to which drug offenders were otherwise qualified or eligible to receive  federal benefits, we identified key elements of the eligibility to receive  federal benefits. We met with officials at the federal agencies responsible  for administering TANF—the Department of Health and Human Services— and food stamps—the U.S. Department of Agriculture—to discuss issues  related to eligibility to receive these benefits. We obtained and analyzed  data from BJS on the characteristics of drug offenders in prison, and we  applied this information to the number of drug offenders released from  prison during 2001 in states that fully implemented the ban on TANF. To  determine the current status of states that have opted out of or modified  federal provisions banning TANF and food stamp benefits to persons  convicted of drug felony offenses, we reviewed state laws and contacted  officials at USDA (which annually surveys states about the status of their  laws in relation to the ban on food stamps) and state officials in states that  have modified the federal ban on TANF or food stamps to discuss the  status of their provisions regarding the exemptions under their state laws.  Appendix II provides detailed information on our methodology for  assessing the TANF and food stamps bans.
section_title: Data Sources Used in Preparing This Report
paragraphs: From the following sources, we obtained, assessed the reliability of, and  analyzed data related to denial of federal benefits that we used in  developing estimates of the impacts of the federal provisions. To assess  the reliability of the data, as needed, we interviewed agency officials about  the data systems, reviewed relevant documentation, and conducted  electronic tests of the data. We determined that the data were sufficiently  reliable for the purposes of this report. The data sources included    Bureau of Justice Assistance: Data on the number of drug offenders  reported to BJA by state and federal courts as having been denied federal  benefits under the Denial of Federal Benefits Program from 1991 to 2004.
Bureau of Justice Statistics:    Survey of Inmates of State Correctional Facilities in 1997: We used  these data to estimate the number of convicted drug felons in prison  that were parents of minor children, lived with their children prior to  their incarceration, and had incomes within state earned income limits.  We used these estimates to assess the impacts of the provisions  allowing for the denial of TANF and food stamp benefits.
National Corrections Reporting Program, 2001: We used these data to  obtain counts of the number of drug offenders released from prison  during 2001 in selected states. We also used these data to provide  estimates of the level of education completed from drug offenders  released from prison during 2001 and in developing our estimates of  the impacts of the TANF and food stamps provisions.
Survey of Adults on Probation, 1995: We used these data, from the  only national source of data on the characteristics of adults on  probation of which BJS is aware, to learn about the education levels of  drug offenders on probation and in developing estimates of the impact  of denying federal postsecondary education assistance.
Selected state corrections and court officials: For selected states that fully  implemented the ban on TANF and food stamps, we obtained data on the  numbers of convicted drug felons released from prison in during 2001. We  used these data in developing estimates of the impacts of TANF and food  stamps.
Department of Housing and Urban Development: We obtained and  analyzed data from HUD’s Public Housing Assessment System (PHAS) and  Management Operations Certification Assessment System (MASS) for  fiscal years 2002 and 2003 on the number of public housing residents  evicted because of criminal activities (of which drug-related criminal  activities form a subset), and of the numbers denied admission into the  Public Housing Program for reasons of criminal activities.
Seventeen of the 40 largest PHAs in the nation: We requested information  from the 40 largest PHAs about the number of decisions they made during  2003 to deny federally assisted housing to tenants and applicants for  reasons of drug-related criminal activities, and we obtained data from 17  of these PHAs. Not all 17 PHAs provided responses to all of our questions;  therefore, we reported data only on the PHAs that were able to provide  data relevant to the question under review. We selected these PHAs from  among the 1,531 PHAs that managed both Public Housing and Housing  Choice Voucher (HCV) programs as of August 31, 2004. We asked them for  information about denials of federally assisted housing for reasons of  drug-related criminal activities, and we also asked them to provide these  data based on the race of tenants and applicants. HUD does not collect  this information. We used these data in describing the number of persons  denied federally assisted housing and in providing information about the  race of persons denied federal housing benefits.
Department of Education: We obtained and analyzed data on the number  of students applying for federal postsecondary assistance for academic  years 2001-2002, 2002-2003, and 2003-2004. In addition, we obtained data  on the percentage of these applicants who were eligible to receive Pell  Grants and of these, the percentage that received them, and we also  obtained data on the percentage of applicants who received student loans.  We used these data in developing estimates of the impact of the denial of  federal postsecondary education assistance.
In addition, we used published statistical reports from various agencies  such as BJS; Uniform Crime Reports data on drug abuse violation arrests  by state; Department of Health and Human Services reports on the  characteristics of TANF recipients; USDA reports on food stamp  recipients; and the United States Sentencing Commission’s 2003  Sourcebook of Federal Sentencing Statistics.
subsections: section_title: Impacts of the Federal Provisions on Racial Minorities and Long-Run Impacts of Denying Federal Benefits
paragraphs: We were asked to address the impacts of the federal benefit denial laws on  racial minorities and the long-term impacts of denying federal benefits on  individuals that were denied, their families, and their communities.  Although very limited, the available information on these issues is  summarized in appendices II through V.
To determine the extent of data on the race of persons affected by the  denial of federal benefit provisions, we asked the officials that we  interviewed about their knowledge of data on the race of persons denied  federal benefits. We also spoke with researchers and officials at various  organizations about their knowledge of available data. To address data  limitations of HUD data on persons denied federally assisted housing  because of drug-related criminal activities, we requested, obtained, and  analyzed data provided by 17 of the largest PHAs in the nation on the race  of persons denied housing for reasons of drug-related criminal activity.
To determine the current research and data on the potential economic and  social impacts of the loss of federal benefits on individuals, families, and  communities, we conducted literature searches to identify and review  existing studies that have measured the impacts of the denial of federal  benefits on drug offenders and families. We interviewed experts to  understand how the incentives for drug treatment, as provided in the laws  that deny benefits, are likely to affect drug addicts’ behavior, and we  obtained their views regarding the effects that incarceration and drug  convictions might have on a drug felon’s potential employment and  earnings.
We conducted our work from March 2004 to July 2005 in accordance with  generally accepted government auditing standards.
section_title: Appendix II: Denial of TANF and Food Stamps Benefits: Legal Framework and Methodologies
paragraphs: This appendix describes the legal and administrative framework for  denying TANF and food stamp benefits to convicted drug felons and our  methods for estimating the percentage of convicted drug offenders that  would have been eligible to receive TANF and food stamps but for their  drug felony convictions.
subsections: section_title: Legal and Administrative Framework
paragraphs: The Personal Responsibility and Work Opportunity Reconciliation Act  (PRWORA) of 1996 provides that persons convicted of certain drug felony  offenses are banned for life from receiving TANF and food stamp benefits.  Specifically, Section 115 of PRWORA, as amended, provides that an  individual convicted (under federal or state law) of any offense that is  classified as a felony by the law of the jurisdiction involved and that has as  an element the possession, use, or distribution of a controlled substance  shall not be eligible to receive TANF assistance or food stamp benefits.  The prohibition applies if the conviction is for conduct occurring after  August 22, 1996.
TANF assistance includes benefits designed to meet a need family’s  ongoing, basic needs (for example, for food, clothing, shelter, utilities,  household goods, and general incidental expenses) and includes cash  payments, vouchers, and other forms of benefits. TANF assistance  excludes short-term episodic benefits that are not intended to meet  recurrent or ongoing needs and that do not extend beyond 4 months. The  federal prohibition on TANF assistance to convicted drug felons does not  apply to TANF “nonassistance” benefits, which include benefits meant to  assist an individual’s nonrecurring emergency needs. TANF nonassistance  can include drug treatment, job training, emergency Medicaid medical  services, emergency disaster relief, prenatal care, and certain public health  assistance.
The Food Stamp Program provides benefits in the form of electronic  benefit cards, which can be used like cash for food products at most  grocery stores. Eligible households receive a monthly allotment of food  stamps based on the Thrifty Food Plan, a low-cost model diet plan based  upon National Academy of Sciences’ Recommended Dietary Allowances.  For persons between the ages of 18 and 50 who are also viewed as fit to  work and who are not the guardians of dependent children, PRWORA  provides for a work requirement or a time limit for receiving food stamp  benefits. The provision is known as the Able-Bodied Adults without  Dependent (ABAWD) provision. ABAWD participants in the food stamp  program are limited to 3 months of benefits in a 3-year period unless they  meet certain criteria.
PRWORA provides that states may enact a legislative exemption removing  or limiting the classes of convicted drug felons that are otherwise affected  by the federal ban on TANF and food stamps. State laws providing for  exemptions need to have been enacted after August 22, 1996.
The Office of the Administration for Children and Families (ACF) within  the U.S. Department of Health and Human Services provides federal  oversight of the TANF program. TANF is funded by both federal block  grants and state funds, but states are responsible for determining benefit  levels and categories of families that are eligible to receive benefits. State  eligibility requirements establish earned income limits, and other rules,  and these requirements may vary widely among the states.
The U.S. Department of Agriculture’s Food and Nutrition Service (FNS)  provides oversight for the Food Stamp Program, which is the primary  federal food assistance program that provides support to needy  households and to those making the transition from welfare to work.  Eligibility for participation is based on the Office of Management and  Budget federal poverty guidelines for households. Most households must  meet gross and net income tests unless all members are receiving TANF or  selected other forms of assistance. Gross income cannot exceed 130  percent of the federal poverty guideline (or about $1,313 per month for a  family of two and $1,654 per month for a family of three in 2004), and net  income cannot exceed 100 percent of the poverty guideline (or about  $1,010 per month for a family of two and $1,272 per month for a family of  three in 2004). “Gross income” means a household’s total, nonexcluded  income before any deductions have been made. “Net income” means gross  income minus allowable deductions. Allowable deductions include a 20  percent deduction from earned income, dependent child care deductions,  and medical expenses, among others.
According to officials at ACF and FNS, states may implement the  provisions to deny convicted drug felons TANF and food stamps in a  variety of ways. Some states administer the denial of benefits by requiring  applicants to admit to disqualifying felony drug offense convictions at the  time that they apply for benefits. Also according to agency officials,  neither agency regularly collects and assesses data on the number of  persons that self-certify disqualifying drug offenses.
section_title: State Exemptions to the Federal Bans on TANF and Food Stamps
paragraphs: We reviewed documentation provided by USDA and for states that  exempted some or all convicted drug felons from the federal ban on food  stamps, we reviewed states’ laws pertaining to the exemption and we  contacted officials to determine the status of their state’s exemptions to  the federal bans on TANF and food stamps. Table 5 shows these statuses  and for states that have enacted exemptions, provides citations to the state  laws.
There are several general types of modifications to the federal ban on  TANF and food stamps among the states that have modified the ban.  These modifications may include one or more of the following elements:  (1) removing from the ban drug felons convicted for drug use or simple  possession, but implementing the ban for drug sellers or traffickers (e.g.,  possession with intent to distribute offenses); (2) restoring benefits to  drug felons complying with drug treatment program requirements;   (3) restoring benefits so long as drug felons have negative drug test results  over some period of time; and (4) restoring benefits to drug felons after  various waiting periods, such as a number of years after conviction or  release from prison. State modifications may also include other  conditions. For example, Michigan allows convicted drug felons to receive  benefits provided they do not violate the terms of their parole or probation  and other conditions are met. Tables 6 and 7 show the types of  modifications that states have adopted for the TANF and food stamp bans,  respectively. These tables present general categories of different  modifications, not an exhaustive listing of all specific requirements. For  more detail consult the statutes listed in table 5.
Estimating the Percentage of Drug Arrests within States That  Implement, Modify, or Opt Out of the Bans on TANF and Food  Stamps  To obtain a general assessment of the degree to which state decisions to  modify or opt out of the federal bans on TANF and food stamps exempt  drug felons from the federal ban, we estimated the percentage of drug  arrests that occurred within three groupings of states: (1) those that fully  implement the bans, (2) those that have modified them, and (3) those that  have completely opted out of the bans. We used drug arrests as a proxy for  drug convictions, as state-level data on the number of drug felony  convictions are not available. We analyzed data from the 2002 Crime in  the United States: Uniform Crime Reports on the number of persons  arrested for drug offenses in each of the 50 states. Table 8 reports the  relative distributions of drug arrests for the states falling into each  category for the TANF and food stamp bans.
section_title: Methods for Estimating the Percentage of Drug Felons Potentially Affected by the TANF and Food Stamp Bans
paragraphs: To assess the potential impacts of the bans on TANF and food stamps, we  estimated the percentage of a population of drug felons released from  prison that would be eligible to receive TANF, and but for their drug  offense conviction could receive the benefit. By potentially affected, we  refer to convicted drug felons that we estimated met selected eligibility  criteria to participate in these benefit programs. According to our use of  the term “impact,” only those drug felons who were otherwise eligible to  receive benefits actually stood to lose benefits as a result of the bans, and  could therefore be affected by the bans.
To determine the percentage of drug felons that met selected eligibility  criteria, we used data from the Bureau of Justice Statistics’ Survey of  Inmates of State Correctional Facilities in 1997. This survey is based  upon a nationally representative sample of persons in state prisons during  July 1997. The 1997 data represent the most recently available data from  this recurrent survey, which BJS conducts about every 5 years. We used  information from the survey about prisoners’ parental status, employment,  and income prior to incarceration in developing our estimates of the  percentages of drug offenders that were custodial parents and had  incomes within allowable maximums to qualify for the benefits.
For both benefits, we provide estimates that are based on drug offenders  released from prison during 2001 in the subset of states that fully  implemented either the ban on TANF or food stamps. To the extent  possible, we limited the data on drug offenders released from prison to  those who entered prison during 1997 or thereafter. This allowed for a  period of time between the possible date that a drug felony offense was  committed and the date that an offender entered prison, and in this way,  we took into account the implementation date of the ban, which was  August 22, 1996.
Because of data limitations, we did not attempt to develop estimates for  states that modified the bans. For example, some states’ exemptions to the  bans allow that convicted drug offenders may receive benefits (provided  that they are eligible for them) if they do not fail a drug test, if they  undergo required drug treatment, if they do not violate conditions of  probation or parole supervision, or if they meet certain other conditions.  The data that we used did not include this information; therefore, we  could not estimate the potential impacts of the bans in the states that  modified the bans.
We developed estimates of the potential impact of these bans on the  population of released prisoners for 1 year, 2001, the most recent year for  which we obtained data. We did not attempt to develop estimates for all  persons potentially affected by the bans since they went into effect during  1996. We discuss the problems associated with estimating all persons  potentially affected by the bans in a later section of this appendix.
Data and Methods Used to Estimate the Potential Impacts of the  TANF Ban  To estimate the potential impacts of the TANF ban, we obtained data from  states on drug felons released from prison, and using these data, we  applied estimates of the percentages that met selected TANF eligibility  requirements. These methods are described more fully below.
subsections: section_title: Methods to Obtain State- Specific Data on the Number of Drug Felons Released from Prison
paragraphs: For 14 of the 18 states that fully implement the ban on TANF, we obtained  data on the number of drug offenders released from prison during 2001.  We used two sources of data: (1) the Bureau of Justice Statistics’ National  Corrections Reporting Program (NCRP) and (2) data from selected other  states. From NCRP, we obtained counts of the number of drug felons  released from prison during 2001, given that they were committed into  prison in 1997 or thereafter for a new conviction that contained a drug  offense. We chose 1997 because the TANF ban went into effect on August  22, 1996, and data on the date that ex-prisoners committed their drug  offense—which is the factor that determines whether they are under the  ban—were not available in the data that we used. From the other states,  we obtained comparable data on the number of drug offenders released  from prison.
The 14 states for which we obtained data were Alabama, Arizona,  California, Georgia, Kansas, Mississippi, Missouri, Nebraska, North  Dakota, South Carolina, South Dakota, Texas, Virginia, and West Virginia.  The 14 states account for approximately 97 percent of the population in  the 18 states that maintain the ban on TANF for drug felons. For the 4  states that were excluded from our analysis—-Alaska, Delaware, Montana,  and Wyoming—we were unable to obtain data on released prisoners. We  also excluded from our analysis states that may have implemented the ban  in 2001 but as of January 2005 had modified or opted out of the ban.
Across the 14 states, about 96,000 drug offenders were released from  prison during 2001, given that they had been admitted during 1997 or  thereafter. This population of all drug felons released from prison includes  those who were sentenced to prison following their conviction for a drug  offense, and it also includes offenders who entered prison because they  had violated conditions of supervision. Among offenders who entered  prison for a violation of conditions of supervision, some may have  committed their offenses before the TANF ban went into effect, and they  would not be subject to the ban. However, some of the released prisoners  who had violated conditions of supervision may have been convicted after  the ban went into effect, but the available information reported only the  date of admission for the violation and not for the original sentence. These  offenders should be included among the population of drug felons that are  subject to the ban. Hence, the population of all released prisoners might  over estimate the number of drug offenders in these 14 states who  committed offenses after the TANF ban had gone into effect.
About 51,000 of the drug offenders released from prison during 2001 were  those who had been admitted into prison during 1997 or immediately after  their conviction. While this population of released drug offenders includes  those whose prison sentence occurred after the ban went into effect, this  number may under estimate the number of drug felons in these states who  were subject to the ban. It may do so because it will exclude the parole  violators who had initially been committed after 1997 but whose most  recent commitment was for a violation of parole that also occurred after  1997.
About 87 percent of all drug offenders released from prison during 2001 in  the 14 states for which we obtained data were males, as were about 86  percent of the first releases. Females constituted 13 percent of all releases  and 14 percent of first releases (table 9).
section_title: Methods of Estimating the Percentage of Drug Felons That Meet TANF Eligibility Requirements
paragraphs: To receive TANF assistance, an assistance unit (such as a household) must  meet the state-mandated definition of a needy family: It must either  contain at least one child living with an adult relative or consist of a  pregnant woman. The adult guardian must be related to the child by blood,  adoption, or marriage (or, if the state provides, the adult may stand in for  parents if none exist). Further, TANF recipients must in general be either  U.S. citizens or qualified aliens who entered the United States prior to the  passage of PRWORA on August 22, 1996, or who have lived in the United  States for a period of 5 years. States may also impose other conditions for  receipt of TANF benefits.
We used data from the 1997 version of the BJS Inmate Survey to estimate  the percentage of drug offenders who were custodial parents and who had  monthly incomes within state-determined earned income limits. For  estimation purposes, we defined a drug offender in the inmate survey as a  custodial parent if the offender met three conditions: (1) reported being  the parent of at least one minor child, (2) reported living with the child  prior to being incarcerated, and (3) reported that the child was not in  foster care or agency care while the offender was in prison. We computed  the number of prisoners who met these conditions, and from these counts,  we estimated the percentages of drug offenders that met these conditions.  As the data were drawn from a sample, we used weighting factors  provided by BJS that were based on the original probabilities of being  selected into the sample that were adjusted for nonresponse and  information about the sex, race, age, prison security level, and type of  offense of the total prison population to produce national-level estimates.  We estimated the percentages separately by gender and region of the  country. Table 10 shows our estimates of the percentage of convicted drug  felons that were reported to be parents and custodial parents (based on  our definition) of minor children.
We also estimated the income distributions for drug offender parents who  reported living with their children. In the BJS survey, income is reported  as the offender’s total income in the month prior to the arrest leading to  the incarceration. Monthly income can be from any source and may  include illegal income. We omitted from our analysis those offenders who  reported income from illegal sources, and we included only offenders who  reported earned income or who were unemployed prior to their  imprisonment. Offenders who were unemployed prior to their  imprisonment received a value of zero for earned income. We estimated  the income distributions separately by gender and region to account for  differences in employment and earnings between male and female  offenders, and offenders in different states. We applied the regional  income distributions to all states within a region, as the BJS data did not  report the state in which the offender was incarcerated.
From the income distributions, we estimated the gender-specific  percentages of drug offenders who had incomes at or below state- determined earned income limits. The BJS inmate survey data report  income in intervals, and in many cases, the intervals do not correspond  directly with the state earned income limits. Therefore, we selected  income intervals that were as near to the state earned income limits as  feasible. We generally selected two income intervals for each state: one  that contained the state earned income limit level but whose lower bound  was less than the state level, and one that contained the state earned  income limit but whose upper bound was above the state level. In this  way, we obtained upper- and lower-bound estimates of the potential  impacts of the TANF ban.
To obtain estimates of the percentage of drug offenders released from  prison who were both custodial parents and were income eligible for  TANF, as defined above, we applied the gender-specific estimates of the  percentage of prisoners in each region of the country that met the specific  TANF eligibility criteria to state-specific counts of the number of drug  felons released from prison. We used the region of the country within  which a state was located to obtain estimates for a specific state. The  result of these operations was to obtain estimates of the percentage of  drug offenders released from prison who were both custodial parents and  were income eligible for TANF, as defined above. The estimated  percentages of drug offenders released from prison that met these  conditions are shown in table 11.
We were unable to take into account all of the factors that determine  whether drug offenders met the eligibility criteria to receive TANF. Some  of these factors could contribute to reducing the estimated percentages of  drug offenders who were otherwise eligible; others could possibly  contribute to increasing the estimated percentages. In addition, our  estimates for drug offenders released from prison in a given year do not  apply to drug felons who were sentenced to probation. Finally, we are  unable to provide an estimate of the percentage of drug offenders  potentially affected by the ban for the entire period since it was  implemented.
section_title: Factors Contributing to a Decrease in the Percentage of Drug Felons That Would Be Otherwise Eligible to Receive TANF
paragraphs: Data limitations preclude our explicitly taking into account all of the  factors that are related to TANF eligibility. Factors affecting TANF  eligibility for which we do not have data are the citizenship status and  length of residency of noncitizens, state-imposed work requirements to  receive TANF, and individual choices to participate in the program. While  we were unable to estimate the effect of these factors on our estimated  percentages that might have been eligible to receive TANF, these factors  would contribute to lowering our estimates of the percentage of drug  offenders released from prison that might have been eligible to receive  TANF.
Several of the states whose data we analyzed have relatively large  populations of noncitizens. In general, to qualify for TANF, aliens must  have at least 5 years of residence in the United States since August 22,  1996. Given that our estimates are for 2001, it is unlikely that many aliens  among convicted drug felons would have qualified for TANF. Hence,  taking the alien qualification into account would lower our estimates of  the percentage of drug felons potentially affected by the TANF ban. For  2003, ACF reports that 8 percent of adult TANF recipients were qualified  aliens.
Individuals within needy families who do not participate in state- determined work requirements could lose their TANF eligibility. Failing to  comply with work requirements would reduce the percentage of drug  offenders that were otherwise eligible to receive TANF.
In the general population, adult males constitute comparatively small  numbers of TANF recipients. According to ACF, in 2001 adult males  constituted about 9 percent of all adult TANF recipients. If we applied the  general population adult male TANF recipiency rate to our estimates of  the percentage of all drug offenders released from prison, our estimated  impact of the TANF ban would be revised downward to about 4 percent of  all of drug offenders released from prison in 2001.
section_title: Change in Status after Release from Prison Could Increase the Percentage of Drug Felons Affected by the Ban
paragraphs: One factor that could change the estimated percentage of convicted drug  felons eligible to receive TANF benefits and therefore potentially affected  by the ban is a change in a felon’s eligibility to receive TANF. Our  estimates of the percentage of prisoners that may be eligible to receive  TANF are based on attributes existing at the time that offenders were in  prison. Upon release, these attributes may change, and an offender might  become otherwise eligible for TANF and therefore potentially be affected  by the ban. For example, if a drug offender was reunited with his or her  children after release and met other eligibility requirements, this would  contribute to increasing the percentage of released prisoners that were  eligible to receive TANF. Alternatively, imprisonment may be a factor that  reduces contact with children and therefore contributes to decreasing the  percentage of drug offenders released from prison that are eligible to  receive TANF.
section_title: Drug Felons Sentenced to Probation
paragraphs: In recent years, drug felons sentenced to probation account for about one- third of all convicted and sentenced drug felons. We did not apply the  information about drug offenders in prison to the drug felons sentenced to  probation. This is because we do not have data on the parental and income  characteristics of drug felons sentenced to probation. To the extent the  drug felons sentenced to probation have characteristics similar to those of  drug felons released from prison, the estimated percentage of probationers  that may be eligible to receive benefits would be similar to those estimated  percentages among released prisoners. However, if income levels and  other factors differ between probationers and prisoners, this could affect  the estimates of the percentages that would be eligible to receive benefits.
section_title: Drug Offenders Affected since the Ban Went into Effect
paragraphs: We do not provide an estimate of all drug offenders potentially affected by  the ban on TANF since it went into effect. We were unable to obtain data  on the number of persons convicted of drug felonies since the ban went  into effect in 1996, as only limited data are available. Over time, an  individual’s attributes that are related to TANF eligibility may change.  Convicted drug felons who did not have characteristics that would make  them eligible to receive TANF at one point in time could develop these  attributes at a later point in time. Conversely, the circumstances of  convicted drug felons who at one point in time were otherwise eligible to  receive TANF could change so that they are no longer otherwise eligible.  To understand the long-term impacts of the ban therefore would require  data that track individuals over time and measure changes in their  characteristics that are related to TANF eligibility. We know of no such  national data on drug offenders.
Our estimates of the percentage of drug offenders released from prison in  a given year who are potentially affected by the ban represent lower- bound estimates of the proportion of drug offenders released from prison  during that year that would ever be affected by the ban. If, among those  released from prison and estimated not to be eligible to receive TANF, any  persons became eligible at a later date, this would increase the percentage  of persons potentially affected by the ban. Consequently, the long-term  impacts of the ban would be greater than the impacts that we estimated  for the 1-year release cohort. Similarly, if the 1-year estimates of the  percentage potentially affected by the ban were to hold over time, then a  larger percentage of all convicted drug felons would be potentially  affected by the ban since its inception than the percentages that we  estimated for 1 year.
Data and Methods Used to Estimate the Potential Impact of the  Ban on Food Stamps  We focused our analysis of the potential impact of the ban on food stamps  on drug offenders that were reported to be custodial parents of minor  children. According to USDA, in fiscal year 2003, adult households with  children (containing either one or two adults) constituted 73 percent of  food stamp recipients. Consequently, this is likely to be the largest group  of drug offenders that could be affected by the food stamp ban. We were  unable to develop a quantitative estimate of the percentage of able-bodied  adults without dependents (ABAWD) that could be affected by the food  stamp ban. ABAWDs, in general, may receive food stamps for 3 months  within a given 3-year period or longer if they adhere to the work  requirements specifically laid out for ABAWDs. However, we were unable  to determine which drug offenders constituted the potential pool of  ABAWDs. We further gave the potential ABAWDs recipients separate  consideration because, according to USDA reports, in 2003, they  constitute 2.5 percent of food stamp recipients nationwide even though  they form a large share of the general population of such persons. We also  did not attempt to develop an estimate of the impact of the ban for elderly  and disabled drug offenders.
For 2003, USDA reported that adult households with children (containing  either one or two adults) constitute 73 percent of food stamp recipients. In  contrast, elderly individuals living alone constitute 6 percent of food stamp  recipients, and disabled nonelderly individuals living alone constitute 5  percent of food stamp recipients. Single-adult households—which  according to USDA do not contain children, elderly individuals, or  disabled individuals—constitute 6 percent of food stamp recipients.  Therefore, adult households with children receive food stamps at a rate  greater than 12 times the rate at which single-adult households receive  food stamps. The percentage of single adult households receiving food  stamps is higher than the percentage of ABAWDs receiving food stamps  because an individual is not considered an ABAWD if the person is  pregnant, exempt from work registration, or over 50 years of age.
For 12 of 15 states that maintain the full ban on food stamps, we obtained  data on the drug felons released from prison during 2001 (given that they  entered prison during 1997 or thereafter). The 12 states are Alabama,  Arizona, Georgia, Kansas, Mississippi, Missouri, North Dakota, South  Carolina, South Dakota, Texas, Virginia, and West Virginia. The 3 excluded  states for which we were unable to obtain data were Alaska, Montana, and  Wyoming. A total of 67,000 drug offenders were released in 2001 in the 12  states, and of these, 30,000 were first releases from new court  commitments.
We used the BJS inmate survey data to estimate the percentage of drug  felony prisoners who were parents living with their minor children and  whose children were not in foster care while they were incarcerated. This  was our operational definition for a custodial parent. For these, we  estimated the percentage who had gross incomes within the poverty  thresholds, based on estimates of family size. Food stamp eligibility is  based on gross and net income tests. Because data on the deductions that  are used in determining whether households meet the net income tests  were not available, our estimates are at best gross income tests. We are  unable to determine how our use of the gross income test alone affects our  estimates of the percentage of drug felons released from prison that would  have been eligible to receive food stamps.
In general, ABAWDs may receive food stamp benefits for an extended  duration as long as they meet ABAWD-specific work requirements. This  means that a large percentage of drug felons could be eligible to receive,  and therefore potentially be denied, food stamps as long as they fell within  the income threshold to receive food stamps. However, among all food  stamp recipients, ABAWDs constitute only 2.5 percent of the total. Hence,  while we cannot estimate the percentage of ABAWDs within the drug  offender pool that would be otherwise eligible to receive food stamps, the  ABAWD participation rate in food stamps in general would suggest that  relatively few drug offenders who fall into this category would participate  in the program.
section_title: Data on the Race of Drug Offenders Who Meet Selected TANF Eligibility Criteria
paragraphs: We assessed the impacts of the denial of TANF and food stamp benefits by  estimating the percentage of convicted drug felons released from prison  who were otherwise eligible to receive the benefits. To assess whether  impacts vary by race, we first assessed whether the percentage of drug  offenders who met the same eligibility requirements that we used to assess  the overall impacts of the TANF and food stamp bans varied according to  race. For example, if larger proportions of black than white drug offenders  were custodial parents of minor children and had earned income that  permitted them to qualify for TANF, then we would expect to find larger  percentages of black drug offenders to be affected by the TANF ban,  regardless of the racial composition of the group of all drug offenders  released from prison.
We used the BJS inmate survey data to compare the estimated percentages  of black and white drug offenders who were custodial parents (as we  defined the term previously) and had earned incomes that could qualify  them to receive TANF. As before, we estimated these percentages by  gender and region. Our estimates indicated that in one region (the South),  the percentage of black female drug offenders who were otherwise eligible  to receive TANF differed from the percentage of otherwise eligible white  female drug offenders. A larger percentage of black female drug offenders  in that region were estimated to be eligible to receive TANF than white  female drug offenders in the region. Among male drug offenders, we  estimated differences in eligibility for TANF in two regions. For both  female and male drug offenders, the differences in estimated TANF  eligibility arose from differences in incomes, as there were no differences  in the percentage of black and white drug offenders that were estimated to  be custodial parents.
section_title: Appendix III: Denial of Federal Postsecondary Education Benefits to Drug Offenders
paragraphs: This appendix describes the legal framework for denying federal higher  education benefits to drug offenders, how the federal provision is  administered, our methods for estimating the number of students affected  by the federal provisions, and the impacts of the federal provision.
subsections: section_title: Legal Framework for Denying Federal Higher Education Benefits
paragraphs: The Higher Education Act of 1965, as amended, provides for the  suspension of certain federal higher education benefits to students who  have been convicted for the possession or sale of a controlled substance  under federal or state law. The controlled substance offense may be either  a felony or a misdemeanor. Federal higher education benefits that are  denied to such individuals include student loans, Pell Grants,  Supplemental Educational Opportunity Grants, and the Federal Work- Study program.
The Higher Education Act provision outlines different periods for which  such drug offenders are ineligible to receive certain federal higher  education benefits, depending upon the type and number of controlled  substance convictions. The period of ineligibility begins on the date of  conviction and ends after a specified interval. Table 12 illustrates the  period of ineligibility for the federal higher education benefits, according  to the type and number of convictions.
This Higher Education Act provision allows for eligibility for federal  higher education to be restored prior to the end of the period of  ineligibility if either one of two conditions is met. First, a student  satisfactorily completes a drug rehabilitation program that includes two  unannounced drug tests and complies with criteria established by the  Secretary of Education. Second, a student has his or her drug conviction  reversed, set aside, or nullified.
section_title: Administration of the Denial of Federal Higher Education Benefits
paragraphs: The provisions of federal law mandating the denial of certain federal  higher education benefits were implemented beginning in July 2000 by  requiring students who applied for federal assistance to self-report  disqualifying drug convictions. Students must self-report disqualifying  drug convictions through the Department of Education’s Free Application  for Federal Student Aid, a form that any student who wishes to receive  federal student aid must complete. The FAFSA is available online and is  free to use. ED uses the information that applicants provide on their  FAFSA to determine their eligibility for aid from the Federal Student Aid  (FSA) programs. Colleges and universities in 49 states also use  information from the FAFSA in making their financial aid determinations.  ED provides participating colleges and universities with a formula to use  when making decisions about financial assistance.
Applicants who either report that they have a drug conviction that affects  their eligibility or those applicants who do not answer the question about  drug convictions are automatically ineligible to receive federal higher  education assistance in the academic year for which they sought aid.  (Below, we refer to this group as FAFSA ineligibles.) The drug conviction  worksheet of the FAFSA also notifies students that even though a drug  conviction may render them ineligible to receive federal higher education  assistance in the application year, individuals may still be eligible to  receive aid from their state or their academic institution.
section_title: Methods for Estimating the Numbers of Persons and Amounts of Federal Assistance Affected by the Provisions
paragraphs: For several reasons, not all of the FAFSA applicants who self-report a  disqualifying drug conviction would otherwise have been eligible to  receive federal assistance; hence, the number of applications containing  self-reported disqualifying drug offenses overstates the number of persons  denied federal postsecondary education assistance because of a drug  offense conviction.
First, not all FAFSA applicants are eligible to receive all types of federal  postsecondary education assistance. For example, some applicants may  have incomes above the levels required to receive Pell Grants, and even if  they self-reported a disqualifying drug conviction, they would not have  been eligible to receive Pell Grants. Second, ED officials indicated that not  all FAFSA applicants become enrolled in postsecondary education  institutions, and these applicants are not eligible to receive federal  postsecondary education assistance. Third, some individuals may  complete the FAFSA application more than one time, and by counting only  the number of applications, some individuals may be double-counted.
To assess the impacts of the Higher Education Act’s provisions that render  students with disqualifying controlled substances convictions ineligible to  receive federal postsecondary education assistance, we estimated the  number of students who self-reported a disqualifying drug offense and,  absent the controlled substances convictions provisions of the Higher  Education Act, would have been qualified to receive assistance but  because of the provisions would not have received assistance.
We developed estimates of the number of applicants for Pell Grants and  subsidized and unsubsidized Stafford loans (two of the best-funded federal  postsecondary education assistance programs) and the total amounts of  assistance lost, because of their self-reported controlled substances  convictions. Our methods for estimating these quantities are as follows:    To estimate the number of students who were denied Pell Grants in a  given year, we use ED data on the number of FAFSA applicants that  either self-reported a disqualifying drug offense conviction or left this  question blank, the group that we labeled as FAFSA ineligibles.
As applicants must meet needs-based criteria to make them eligible to  receive Pell Grants, we then use ED data on the percentage of FAFSA  applicants that were eligible to receive Pell Grants; we call this second  group Pell Grant eligibles.
We use ED data on the percentage of Pell Grant eligibles that actually  received Pell Grants, as not all of the students who were eligible to  receive Pell Grants received them. By multiplying these quantities, we  obtained a rough estimate of the number of persons who, absent the  disqualifying drug offense conviction, would have received Pell Grants.
To estimate the dollar amount of Pell Grants that these recipients  would have received, we multiplied the average amount of Pell Grants  (which we obtained from ED) by the estimated number of students  denied Pell Grants.
To estimate the number of student loan recipients who were denied  assistance because of disqualifying drug convictions, we followed a  method similar to the one that we used to estimate the numbers denied  Pell Grants.
Specifically, beginning with the data on FAFSA ineligibles, we applied  to this number the percentage of all FAFSA applicants that received a  student loan. We could not obtain an estimate of the number of FAFSA  applicants that were eligible to receive student loans because, as ED  reports, unlike Pell Grants, where there are income limitations that can  be used to determine eligibility, with student loans, eligibility is  determined by both income and institution-specific factors (such as  tuition). Thus, our estimate is of the number of FAFSA ineligibles that  would have received a student loan but for their controlled substances  convictions.
To estimate the amount of student loans denied, we multiplied our  estimate of the number denied student loans by the average amount of  a student loan.
subsections: section_title: Critical Assumptions in Estimating the Number of Pell Grant and Student Loan Recipients Denied Federal Benefits because of Disqualifying Controlled Substances Convictions
paragraphs: In order to create our estimates for the number of individuals who would  have received a Pell Grant or a student loan if not for their drug  conviction, we assume that the characteristics of FAFSA eligibles are the  same as the characteristics of FAFSA ineligibles. This assumption means  that the percentage of FAFSA applicants who are eligible to receive  federal higher education assistance should be the same for FAFSA  ineligibles (apart from the drug conviction).
Income is an important determinant of eligibility for both Pell Grants and  student loans. Specifically, financial need is determined by ED using a  standard formula established by Congress to evaluate the applicant’s  FAFSA and to determine the student’s Expected Family Contribution  (EFC). The EFC calculation includes various data elements including  income, number of dependents, net assets, marital status, and other  specified additional expenses incurred. Different assessment rates are  used for dependent students, independent students without dependents,  and independent students with dependents. After filing the FAFSA, a  student is notified if he or she is eligible for a federal Pell Grant and of the  student’s EFC.
On the one hand, if FAFSA ineligibles on average have lower incomes than  FAFSA eligibles, then our estimates of the number of students denied  benefits are likely to be underestimates of the true number denied  benefits. This is because we rely on the information about eligibility for  Pell Grants and student loans from the persons who were eligible to  receive them, not from the population who are otherwise eligible but for  their disqualifying drug convictions. On the other hand, if FAFSA  ineligibles are less likely to be enrolled in postsecondary education  institutions, as compared with FAFSA eligibles, then our estimates of the  number denied benefits are likely to overestimate the true number denied  benefits.
section_title: Data Used to Estimate the Numbers and Amounts Denied Federal Assistance
paragraphs: Table 13 shows the data that we used to estimate the numbers and  amounts of federal postsecondary education assistance that was forgone  to students who, absent their controlled substances convictions, would  have received federal postsecondary education assistance. The data are  provided annually for academic years 2001-2002 through 2003-2004. The  key data elements used to estimate the numbers and amounts of federal  assistance denied include  the number of FAFSA applicants and FAFSA ineligibles,  the percentage of Pell Grant eligibles among all FAFSA applicants,  the percentage of Pell Grant recipients among Pell Grant eligibles,  the average amount of Pell Grant received,  the percentage of FAFSA applicants that received student loans, and  the average amount of student loan received.
The number of FAFSA ineligibles declined from 58,929 in academic year  2001-2002 to 41,061 in academic year 2003-2004. We note that FAFSA  ineligibles amount to less than 0.5 percent of all FAFSA applications.
section_title: Estimates of the Numbers and Amounts of Federal Assistance Affected by Controlled Substances Convictions
paragraphs: In the academic years from 2001-2002 through 2003-2004, we estimated  that between 17,000 and 23,000 students were denied Pell Grants because  of their drug convictions, and that the total estimated amount of Pell  Grants that these students would have received ranged from $41 million to  $54 million. See table 14.
We provide annual estimates of the numbers affected because the period  of benefit ineligibility can vary, and a student denied benefits in one year  may become eligible to receive benefits in a subsequent year. Thus, the  estimates for one year do not necessarily affect the estimates for another  year.
In academic year 2001-2002, there were 58,929 FAFSA ineligibles. During  that same year 51.5 percent of FAFSA applicants were eligible to receive  Pell Grants, and 76.9 percent of those who were eligible received Pell  Grants (as shown in table 13). Multiplying the 58,929 by the 51.5 percent  and then multiplying this result by the 76.9 percent results in the estimate  of 23,000 individuals denied Pell Grants who otherwise would have  received them. To obtain the amount of Pell Grant lost to these students  during academic year 2001-2002, we multiplied our estimated number of  students denied Pell Grants (23,000) by the average amount of a Pell Grant  in academic year 2001-2002 ($2,298).
Table 14 also shows that between academic year 2001-2002 and academic  year 2003-2004, an estimated 29,000 to 41,000 students per year would have  received student loans if not for their drug convictions. The estimated total  amount of student loans forgone by these students ranged between $100  million and $164 million per year.
subsections: section_title: Estimates of the Impacts of the President’s Proposed Changes to the Rules for Denying Drug Offenders’ Federal Postsecondary Education Assistance
paragraphs: The President’s fiscal year 2005 budget contained a proposal that would  have changed the administration of the Higher Education Act provision  relating to eligibility for federal higher education benefits. Federal law  disqualifies students who have been convicted of controlled substance  offenses, in accordance with the period of ineligibility in table 12, from  receiving federal higher education assistance. As currently implemented  by the Department of Education, disqualifying convictions are those drug  convictions on a student’s record at the time the student’s eligibility is  being determined, using the rules on the FAFSA worksheet. Under the  President’s proposal—which was supported by the Office of National Drug  Control and Prevention—students would be ineligible for federal higher  education assistance only if they committed a disqualifying drug-related  offense while they are enrolled in higher education. This proposed change  would make eligible all students whose controlled substance convictions  occurred prior to enrolling in higher education.
Because of data limitations, we are unable to provide reliable estimates of  the impacts of the proposed changes contained in the President’s fiscal  year 2005 budget proposal. However, we expect that the proposal would  lower our estimates for the numbers of students denied benefits because  some individuals would regain their eligibility for benefits, and relatively  few students enrolled in postsecondary education institutions would be  expected to both use drugs and be convicted of drug crimes.
section_title: Limited Data on the Long-Term Impacts of Denying Federal Postsecondary Education Assistance
paragraphs: While studies consistently show that the economic returns to higher  education are positive, we cannot establish a direct link between the  denial of federal postsecondary aid to students and a reduction in the  amount of postsecondary education completed by those who were denied  aid. Moreover, officials at ONDCP also suggested that the provisions of the  Higher Education Act that provide for denying educational aid to drug  offenders might contribute a deterrent effect on drug use. Similarly, we  were unable to identify studies that assess whether provisions of the HEA  actually helped to deter drug use. Additionally, we are unable to address  the question of whether these provisions of the HEA that deny higher  education benefits to drug offenders result in net positive or negative  effects on society because we were unable to find research that  conclusively indicates whether these provisions of the HEA led individuals  to forgo postsecondary education or deterred individuals from engaging in  drug use and drug-related criminal activities.
Additional formal education—e.g., completing high school or attending or  completing postsecondary education—has been demonstrated to increase  annual and lifetime earnings. In its review of the returns to education, the  U.S. Census Bureau concluded that increases in formal education had a  positive impact on annual earnings. For example, the U.S. Census Bureau  reported that for full-time workers between the ages of 25 and 64 between  1997 and 1999 the average annual income for those who have not  completed high school is $23,400, for high school graduates it is $30,400,  and for those completing a bachelor’s degree it is $52,200. Average annual  income rises higher yet for those who obtain advanced degrees.
This general pattern, that increases in formal education correlate with  increases in annual earnings, also holds true across an individual’s  lifetime. The U.S. Census Bureau reported that the average lifetime  earnings, based upon 1997-1999 work experience, for those who have not  completed high school is approximately $1 million, for high school  graduates it is $1.2 million, and for those completing a bachelor’s degree it  is $2.1 million. Again, the average lifetime earnings rise higher yet for  those who obtain advanced degrees. Hence, college graduates can expect,  on average, to earn nearly twice as much over a lifetime as those persons  who have only a high school diploma and more than twice as much as  those who have not completed high school.
Similarly, a study published by the congressional Joint Economic  Committee in January 2000 concluded that there is a strong consensus  among economists that formal education has a positive impact not only on  personal income but also on society. The study concluded that among the  positive societal economic returns from increases in formal education are  the creation of new knowledge (translating into the development of new  processes and technologies) and the diffusion and transmission of  knowledge (translating into the expansion of innovative techniques such  as those found in the high-technology sector). Positive societal  noneconomic improvements are also associated with increased amounts  of formal education, which help Americans become better mothers,  fathers, children, voters, and citizens. These positive noneconomic  improvements are sometimes called positive neighborhood effects. Some  of the positive neighborhood effects may be (1) more informed and  interested voters, (2) decreases in crime, (3) decreased dependence upon  certain types of public assistance, and (4) decreased incidence of  illegitimate pregnancies.
Although the census study and the study conducted by the Joint Economic  Committee show positive economic and societal impacts of increased  levels of education, the total net impacts of these benefits are difficult to  quantify. Moreover, these studies do not comment on whether the loss of  federal education assistance (as occurs for drug offenders through the  provisions of the HEA) contributes to individuals’ not completing  postsecondary education, or whether those individuals who are denied  federal education assistance generate the necessary funding to attend  institutions of higher education in other ways.
Also at issue is whether the provisions of the HEA that deny  postsecondary education benefits to drug offenders contribute positively  to society by providing a deterrent to drug use. Research on the costs to  society from drug use, and drug-associated criminal involvement,  demonstrated that these costs to society are high. Therefore, if the denial  of federal higher education benefits deters people from engaging in drug  crimes, then the provisions might have positive economic and  noneconomic impacts on society. Some of the positive affects of  deterrence may include reductions in drug-related health care costs,  reductions in drug-related crime and associated criminal justice costs, and  increased national economic productivity. In addition, for many offenders  and in particular for first-time drug offenders, the denial of postsecondary  education benefits may delay entry into postsecondary education rather  than prevent it.
section_title: Limited Data on Racial Minorities and the Denial of Federal Postsecondary Education Benefits
paragraphs: With the available data, we were unable to determine whether the  provisions of the Higher Education Act that provide for denial of  postsecondary education benefits would affect relatively larger or smaller  numbers of minorities. The FAFSA does not request information about  applicants’ race; therefore ED does not have data on the racial distribution  of applicants or FAFSA ineligibles. Without data on the race of applicants  for federal student aid, it is not possible to determine whether minorities  are denied aid at higher rates than whites.
The Bureau of Justice Statistics’ Survey of Adults on Probation in 1995,  which is the only national survey of probationers that includes data on the  type of offense of conviction and educational attainment, indicates that  there may be racial differences in the levels of educational attainment of  drug offenders. The survey indicates that black and Hispanic drug  offenders on probation complete high school at a lower rate than white  drug offenders on probation. Specifically, while 68 percent of white drug  offenders on probation had completed high school, 51 percent of black  and 46 percent of Hispanic drug offenders on probation had completed  high school. As completing high school (or gaining a general equivalency  degree) is a prerequisite for enrollment in postsecondary education, these  data suggest that lower proportions of black and Hispanic drug offenders  (at least drug offenders on probation) would be eligible to enroll in  postsecondary educational institutions and would therefore be eligible for  federal higher education assistance.
section_title: Appendix IV: Denial of Federally Assisted Housing Benefits for Drug-Related Criminal Activity
paragraphs: This appendix provides background on the legal and administrative  frameworks for denying federally assisted housing benefits to persons  who engage in drug-related criminal activities, our methods for estimating  the numbers of persons denied benefits, and how we assessed the  available data on racial minorities and the limited information on potential  impacts.
subsections: section_title: Legal Framework Relating to the Denial of Housing Benefits for Drug-Related Criminal Activity
paragraphs: Federal law contains a variety of provisions relating to the denial of  federally assisted housing benefits for certain types of drug-related  criminal activity. These provisions relate to, among other things, (1) who  may lose eligibility for federally assisted housing benefits because of drug- related criminal activity and (2) screening tools for the providers of  federally assisted housing to use to determine ineligibility for such housing  benefits. Motivation for prohibiting drug offenders from public housing is  reflected, in part, in congressional findings made in 1990 and amended in  1998, about drug-related criminal activities in public housing; these  findings stated, in part, that (1) “drug dealers are increasingly imposing a  reign of terror on public and other federally assisted low-income housing  tenants,” (2) “the increase in drug-related crime not only leads to murders,  muggings, and other forms of violence against tenants, but also to a  deterioration of the physical environment,” and (3) “the Federal  government has a duty to provide public and other federally assisted low- income housing that is decent, safe, and free from illegal drugs.”
Public housing agencies, which are typically local agencies created under  state law that, under Department of Housing and Urban Development  guidance, manage and develop public housing units for low-income  families, are required, for example, to utilize leases that provide that any  drug-related criminal activity on or off the premises by a public housing  tenant shall be cause for termination of the tenancy. This provision also  specifically applies to drug-related criminal activity by any member of the  tenant’s household or any guest or other person under the tenant’s control.  Similarly, federal law requires PHAs and owners of federally assisted  housing to establish standards or lease provisions that allow for the  termination of the tenancy or assistance for any household with a member  who the PHA or owner determines is illegally using a controlled  substance. Federal law further specifies that tenants evicted from  federally assisted housing by reason of drug-related criminal activity are to  be ineligible for federally assisted housing for a 3-year period, although  evicted tenants that successfully complete an approved rehabilitation  program may regain their eligibility before the 3-year period ends.
Under federal law and implementing regulations, PHAs have the discretion  to evict tenants for drug-related criminal activity but are not required to  evict such tenants. Rather, they are required to use leases that provide that  any drug-related criminal activity on or off the premises by a public  housing tenant shall be cause for termination of the tenancy.  Implementing regulations by the U.S. Department of Housing and Urban  Development relating to termination provide that a determination of such  criminal activity may be made regardless of whether a person has been  arrested or convicted of such activity and without satisfying a criminal  conviction standard of proof of the activity.
With respect to methamphetamine convictions, PHAs are required under  federal law to establish standards to immediately and permanently  terminate a tenancy as well as permanently prohibit occupancy in public  housing for persons convicted of certain methamphetamine offenses  occurring on public housing premises. PHAs do not have discretion in  evicting these persons, and the standards also require that Housing Choice  Voucher Program (formerly Section 8 low-income housing) participation  be denied to such persons.
Federal law also provides various screening tools to assist with  determining possible ineligibility of tenants and applicants for federally  assisted housing benefits because of drug-related criminal activity. These  tools come primarily in the form of access to certain types of information.  For example, under federal law, housing assistance agencies are  authorized to request access to criminal conviction records from police  departments and other law enforcement agencies for the purposes of  applicant screening, lease enforcement, and eviction. PHAs have the  authority under certain conditions to request access to such information  with respect to tenants and applicants for the Housing Choice Voucher  Program. Public housing authorities are also authorized under federal law  to require that applicants provide written consent for the public housing  authorities to obtain certain types of records, such as criminal conviction  records and drug abuse treatment facility records.
section_title: HUD and PHA Roles in Denying Federally Assisted Housing Benefits for Reasons of Drug-Related Criminal Activities
paragraphs: HUD is responsible for establishing the rules and providing guidance to  PHAs in their administration of federally assisted housing benefits. PHAs  can manage a single program or multiple HUD programs. HUD’s Office of  Public and Indian Housing oversees the two key rental housing assistance  programs that we reviewed, namely the Low-Rent Public Housing  Assistance Program (also referred to as low-rent, or public housing) and  the HCV Program.
During the 1990s, PHAs gained broader latitude from HUD and Congress  to establish their own policies in areas such as selecting tenants. This  included increased latitude in taking actions to deny federally assisted  housing benefits to persons receiving housing benefits and to applicants  for benefits. HUD requires PHAs to submit for its review and approval  annual plans that include, among other things, their policies for continuing  occupancy and denying admission for drug-related criminal activities.
Recent HUD guidance regarding denying federal housing benefits to  persons engaged in drug-related criminal activities was issued in its “Final  Rule,” dated May 2001. The rule amended existing regulations regarding  implementing the federally assisted housing tenant eviction and applicant  screening provisions for drug-related criminal activities.
subsections: section_title: PHAs’ Policies to Address Drug-Related Criminal Activities Vary
paragraphs: Termination and admission policies can vary substantially among PHAs  nationwide. In a baseline study (November 2000) of a stratified random  sample of the PHAs that were responsible for managing federally assisted  housing units in the HCV Program, HUD reviewed the discretionary  authority among PHAs. HUD reported that the variation among PHAs in  conducting criminal background checks could legitimately result in an  applicant being barred by one PHA even though the applicant could  otherwise be admitted by another PHA. Some of the variations reported in  the study include differences in (1) the sources used to obtain information  about criminal history and drug-related criminal activities (e.g., newspaper  stories, resident complaints, self-disclosure, official law enforcement  records—federal, state, local); (2) the costs (paid by the PHA) associated  with obtaining official law enforcement criminal background records; (3)  the time span covered by the criminal history search; and (4) whether  consideration is given to repeat offenses, only convictions, or arrests and  convictions.
We obtained and reviewed policies from seven of the largest PHAs having  combined programs—Public Housing and HCV. Our review of their  policies with respect to terminations and admissions for drug-related  criminal activities showed variations in the policies established to deny  housing benefits. For example, policies regarding terminations of leases  (for public housing tenants) or termination of assistance (for HCV  recipients) vary in how they implement the drug-related criminal activity  provisions and in the scope of criminal background that can result in  terminations:    Drug-related criminal activity provisions can range from certain types  of prohibited behaviors (e.g., those that threaten the health and safety  of other residents) to certain drug convictions (e.g., drug-related  criminal activity, and methamphetamine in particular).
Scope of criminal background can vary by the period of prior criminal  history that can trigger termination of leases or assistance, the type of  prohibited drug-related criminal activities (e.g., personal use, felonious  distribution, etc.), or whether there was a conviction in the case.
Analogously, PHA policies on admissions into public housing or into HCV  can vary based on a number of factors, and these variations in policies can  result in differences among PHAs in the types of drug offenders that are  denied federally assisted housing.
Applicant screenings for drug-related criminal activity can occur in  varying forms (such as an application, interview, or eligibility  verification) and at varying times—such as before or after placement  on the PHAs’ waiting lists.
Sources of criminal history information used can vary, so some PHAs  cast a wider net than others when searching for prohibited drug-related  criminal activity. Sources can range from using only local law  enforcement records to using Federal Bureau of Investigation/National  Crime Information Center data.
Periods of ineligibility for prior evictions from federally assisted  housing can vary by time frame and criminal activity (e.g., drug-related  or violent). Ineligibility periods ranged from 3 to 5 years.
The evidence standard for drug addiction can vary to include a  reasonable cause to believe illegal drug use exists or self-disclosure of  illegal use on the application itself.
section_title: Number of Denials of Federally Assisted Housing Benefits
paragraphs: We obtained data from HUD on the number of evictions from and  applicants denied admission into public housing during fiscal years 2002  and 2003 for reasons of criminal activities. In each year, more than 98  percent of the PHAs that manage public housing responded to HUD’s  request for data about security within the units managed by the PHA,  including information on evictions and applicants denied admission.  HUD’s information pertains to persons evicted or denied admission for  reasons of criminal activity; these data do not distinguish between  criminal activity and drug-related criminal activities. The HUD data also do  not include measures of the number of tenants or of the total number of  applicants screened. To adjust for differences in the size of the PHAs, we  calculated a rate at which applicants were evicted or denied admission  into public housing because of criminal activities that was based on the  number of units maintained by all reporting PHAs. These data are reported  in table 15.
During each of the fiscal years, 2002 and 2003, there were more than 9,000  evictions (amounting to less than 1 percent of all units managed) because  of criminal activities. There were about 49,000 applications for admission  into public housing that were denied for reasons of criminal activities  (amounting to about 4 percent of all units). As drug-related criminal  activities are a subset of criminal activities, these data suggest that even if  all of those evicted from public housing for reasons of criminal activity  had engaged in drug-related criminal activities, terminations leading to  evictions would amount to less than 1 percent of the public housing units  managed by PHAs.
subsections: section_title: Selected PHAs Mostly Report That Relatively Small Percentages of Tenants Leases Are Terminated for Reasons of Criminal Activity or Drug- Related Criminal Activities
paragraphs: To gauge the extent to which PHAs denied federally assisted housing by  terminating leases (leading to possible evictions) for drug-related criminal  activities, we contacted 40 of the largest PHAs in the country and asked  them to provide data on the number of actions that they took to evict  tenants by terminating leases and of these, the numbers that were  terminated for criminal activity and for drug-related criminal activity. Of  the 40 PHAs that we contacted, we received data from 17. We assessed the  data that these PHAs provided for reliability.
As shown in table 16, 15 of 17 PHAs that responded to our request  provided data on the total number of public housing termination of leases.  The rate at which PHAs terminated leases for reasons of drug-related  criminal activities varied considerably, from 0 percent in Santa Clara  County to 39.3 percent in Memphis. The Philadelphia PHA, which reported  the largest number of lease terminations (2,324), reported terminating 50  of these leases (or 2.2 percent) for reasons of drug-related criminal  activities. The Santa Clara County PHA terminated the smallest number of  leases (1). Combined, the 13 PHAs that reported both the number of lease  terminations and the number of terminations for drug-related criminal  activities, reported ending a total of 9,249 leases, and 520 of the  terminations (or 5.6 percent of the total) were for drug-related criminal  activities.
Further, although the data on lease terminations for reasons of drug- related criminal activities are not generalizable to all PHAs that manage  public housing program units, the information that they provided on leases  terminated for reasons of drug-related criminal activities, and our  calculation of these numbers as a percentage of terminations for criminal  activities, show wide variation in the extent to which drug-related criminal  activities predominate among all criminal activities that can result in a  termination of a lease. In Cuyahoga County, for example, 82.4 percent of  lease terminations for criminal activity were terminations for drug-related  criminal activities, but in Oakland, 20 percent of the terminations for  criminal activity occurred as a result of drug-related criminal activities. A  majority of the PHAs that reported these data also reported that the  number of lease terminations and the reasons for them (i.e., criminal or  drug-related criminal activities) were similar to or smaller than the  numbers in the prior 3 years.
As shown in table 17, 16 of the 17 PHA respondents were able to provide  some (although often incomplete) data on actions taken to terminate HCV  assistance during 2003. Nine of the 16 PHA respondents were able to  provide data on the number of actions to terminate HCV assistance for  reasons of drug-related criminal activity or criminal activity. However,  only 5 of the 9 respondents were able to provide data on the number of  actions specifically taken to terminate HCV assistance for reasons of drug- related criminal activity. These 5 PHAs took 9,537 actions related to  terminating HCV assistance, of which 54 (or about 0.6 percent) of such  actions were for terminating assistance for reasons of drug-related  criminal activities.
Four of the 9 PHA respondents were able to provide data on the number of  actions taken to terminate HCV assistance for reasons of criminal activity,  and most, but not all, of them provided (at our request) broad estimates  for drug-related criminal activity based on the total number of actions to  terminate HCV assistance during 2003. These 4 PHAs took a total of 3,166  actions related to terminating HCV assistance, of which 133 actions (or  about 4.2 percent) were for terminating assistance because of criminal  activities. Three of the 4 PHAs estimated less than 25 percent of their total  actions could have been for reasons of drug-related criminal activities, and  1 PHA did not provide an estimate. Applying the upper-bound broad  estimates (25 percent) to each PHA’s total actions would be overstating  terminations for reasons of drug-related criminal activity because the  resulting number is most likely to be equal to or be a subset of  terminations for reasons of criminal activities. From a conservative  perspective, it is conceivable that the 133 actions also represent  terminations of assistance for reasons of drug-related criminal activity,  thereby establishing a maximum rate of denial at 4.2 percent for reasons of  drug-related criminal activity.
Seven of the 16 PHA respondents provided only the total number of  actions taken to terminate HCV assistance, along with a broad estimate of  the percentages of terminations that could have been for reasons of drug- related criminal activity. Six of the 7 PHAs reported less than 25 percent of  their total actions could have been for reasons of drug-related criminal  activities, and one reported 51 to 75 percent. Table 17 provides the data on  terminations of assistance from the HCV program.
The majority of PHAs that reported data on terminations from the HCV  program also reported that the number and types of actions that they took  during 2003 were similar to the numbers in the prior 3 years.
section_title: Selected PHAs Report That Relatively Small Percentages of Applicants Are Denied Admission for Reasons of Criminal Activity or Drug-Related Criminal Activities
paragraphs: As shown in table 18, 15 of 17 PHAs that responded to our request  provided data on the number of actions taken on applications for public  housing. However, only 6 of the 15 respondents provided data on the  number of actions specifically taken to deny admission into public housing  for reasons of drug-related criminal activity. Collectively, these six PHAs  took action on 11,538 applications, of which 330 (or about 2.9 percent of)  such actions were for denying admissions for reasons of drug-related  criminal activities.
Nine of the 15 PHAs did not provide counts of the number of denials for  reasons of drug-related criminal activity but provided data on the number  of actions taken to deny admission for reasons of criminal activity. In  completing our request, 4 PHAs provided broad estimates of denials for  drug-related criminal activity based on the total number of actions taken  on applications for public housing, and 5 PHAs did not provide estimates.  Collectively, these 9 PHAs reported a total of 17,921 actions related to  applications for admission into public housing, of which 1,081 actions (or  6 percent) were for denying admission for reasons of criminal activities.  On the basis of our assumption that admission denials for reasons of drug- related criminal activity are most likely to be either a subset of or  equivalent to the admission denials for reasons of criminal activities, we  estimate that the maximum rate of denial for reasons of drug-related  criminal activity for these PHAs is 6 percent.
As with the other outcomes, the PHAs varied in the extent to which they  reported that applicants were denied admission into public housing for  reasons of drug-related criminal activities, and the majority of PHAs that  provided data for 2003 reported that their activities related to actions and  denials in 2003 were similar to the numbers in the prior 3 years.
As shown in table 19, 14 of the 17 PHA respondents provided some  (although mostly incomplete) data on actions taken on applications for the  HCV program. Nine of the 14 PHAs provided data on the number of denials  of admission into the program for reasons of drug-related criminal  activities or criminal activity. Of the 2 PHAs that provided data on the  number of denials for reasons of drug-related criminal activity, 1 PHA  reported no denials, and the other PHA reported 10 denials out of 1,483  actions taken on applications, or 0.7 percent. Seven PHAs provided data  on the number of denials for reasons of criminal activity. Among these 7  PHAs, there were a total of 20,513 reported actions taken on applicants. Of  these, 303 were denied admission for reasons of criminal activities (or  about 1.5 percent). On the basis of our assumption that admission denials  for reasons of drug-related criminal activity are most likely to be either a  subset of or equivalent to the admission denials for reasons of criminal  activities, we estimate that the maximum for admission denials for reasons  of drug-related criminal activity is 1.5 percent. We could not provide  reliable estimates for the remaining 5 PHAs that reported incomplete data.
section_title: Several Factors Can Contribute to the Reported Low Number of Denials because of Drug- Related Criminal Activities, but Potential Impacts Are Unclear
paragraphs: Our review of limited data and interviews with those involved in federally  assisted housing suggest a number of factors can contribute to the  relatively low percentages of denials being reported for reasons of drug- related criminal activities. As noted in a HUD baseline study, variation  among PHAs in conducting HCV criminal background checks could  legitimately result in an applicant being barred by one PHA who would  otherwise be admitted by another PHA. In addition, a HUD official  suggested that the percentages of denials that were reported to us by  selected PHAs can be influenced by whether (1) the PHAs place drug users  at the bottom of their waiting lists, (2) PHAs differ in the treatment of  applicants if a household member rather than the applicant is the subject  of the drug-related criminal activity, and (3) local courts presiding over  eviction proceedings view the PHAs as the housing provider of last resort.  In the last instance, the PHA’s decision to terminate a lease for reason of  drug-related criminal activity may not be upheld.
Moreover, comments made during interviews with selected officials on  matters related to housing were consistent with our analysis of HUD data  on PHA denials for criminal activity, and the relatively low number of  denials for drug-related criminal activity provided to us by selected PHAs.  Regarding the relatively small number of persons whose housing benefits  were reported as terminated or persons denied program participation for  reasons of criminal or drug-related criminal activities, a representative  from the National Association of Housing and Redevelopment Officials  stated that PHAs are not looking to turn away minor offenders (e.g., “the  type of people that may have only stolen a candy bar”) but rather hardened  criminals. On the variation in denials of federally assisted housing for  drug-related criminal activities, the Project Coordinator for the Re-Entry  Policy Council at the Council of State Governments suggested that the  barriers to housing ex-drug offenders revolve around the discretion  afforded PHAs, and that these barriers can best be dealt with at the local  level by making states more aware of the issue, the applicability of the  local rules, and the need for building collegial relationships with PHAs to  develop options for housing ex-felons.
More generally, assessing the impacts of the denial of federal housing  benefits on the housing communities or on the individuals and families  that have lost benefits was beyond the scope of our review, given the  limited data that are available. Officials at HUD reported that they have  not studied this issue, and our review of the literature did not return any  comprehensive studies of impacts. In our opinion, any full assessment of  the impacts of denial of housing benefits to drug offenders would have to  consider a wide range of possible impacts, such as improvements in public  safety that result from terminating leases of drug offenders; displacement  of crime from one area to another with perhaps no overall (or area-wide)  improvements in crime reduction; as well as the impacts on individuals  and families, to name a few. Any such impact assessments would be  complicated by the market conditions (limited quantity and high demand)  for federally assisted housing and the variation in PHAs’ policies and  practices that would also need to be considered.
section_title: Data on the Race of Persons Denied Federally Assisted Housing Were Infrequently Provided
paragraphs: We requested the PHAs to provide us with data on the race of persons who  were denied federally assisted housing for reasons of drug-related criminal  activities. Of the 17 PHAs that responded to our request, few provided data  by race on (1) the total number of actions taken and (2) those actions that  were specifically for drug-related criminal activity. Only 4 PHAs provided  data by race on public housing terminations, and 3 PHAs provided data by  race on public housing admission denials. Four PHAs provided data by  race on HCV terminations of assistance. Only 1 PHA provided data by race  on HCV admission denials.
From these limited data, we were unable to develop reliable estimates of  racial differences in the frequency of terminations and denials of  admission into federally assisted housing. In some cases, the number  reported as terminated for drug-related criminal activities was too small to  provide stable estimates, and because of the small numbers, the estimates  of racial differences could exhibit large changes with the addition of a few  more cases. For example, only 4 PHAs provided data by race on the  number of leases terminated for reasons of drug-related criminal activities.  In 1 PHA, slightly more than 3 percent of all lease terminations of blacks  were for drug-related criminal activities, while almost 6 percent of all lease  terminations of whites were for drug-related criminal activities. In this  PHA, whites were about one and one half times more likely than blacks to  have their leases terminated for reasons of drug-related criminal activities.  In this PHA, 110 whites had leases terminated during 2003, and 6 of these  terminations were for drug-related criminal activities. In a second PHA,  blacks were three times as likely as whites to have their leases terminated  for reasons of drug-related criminal activities, as 18 percent of blacks and  5 percent of whites had leases terminated for reasons of drug related  criminal activities. But in this second PHA, 19 whites had leases  terminated, and 1 of these was for drug-related criminal activities. An  addition of 2 whites to the number that had leases terminated for drug- related criminal activities would have almost eliminated the racial  difference.
section_title: Appendix V: Legal and Administrative Framework for the Denial of Federal Benefits Program
subsections: section_title: About the Law
paragraphs: The Denial of Federal Benefits Program established under section 5301 of  the Anti-Drug Abuse Act of 1988, in general, provides federal and state  court judges with a sentencing option to deny selected federal benefits to  individuals convicted of federal or state offenses for the distribution or  possession of controlled substances. The federal benefits that can be  denied include grants, contracts, loans, and professional or commercial  licenses provided by an agency of the United States. Certain benefits are  excluded from deniability under this provision of the law; these include  benefits such as social security, federally assisted housing, welfare,  veterans’ benefits, and benefits for which payments or services are  required for eligibility. Federally assisted housing, TANF, and food stamp  benefits may be denied to drug offenders under other provisions of federal  law. (See app. II for more information on the denial of TANF and food  stamp benefits, and see app. IV for more information on the denial of  federally assisted housing benefits.)
Federal and state court sentencing judges generally have discretion to  deny any of the deniable benefits for any length up to those prescribed by  the law, with the exception of the mandatory denial of benefits required  for a third drug trafficking conviction. More specifically, depending upon  the type of offense, and conviction and the number of prior convictions,  the law provides for different periods of ineligibility for which benefits can  or must be denied. As the number of convictions for a particular type of  drug offense increases, so does the period of ineligibility for which  benefits can or must be denied. Table 20 shows these periods.
With respect to first-time drug possession convictions, a court may impose  certain conditions, such as the completion of an approved drug treatment  program, as a requirement for the reinstatement of benefits. In addition,  the sentencing court continues to have the discretion to impose other  penalties and conditions apart from section 5301 of the Anti-Drug Abuse  Act of 1988.
Section 5301 of the Anti-Drug Abuse Act of 1988, as amended, also  provides that under certain circumstances, the denial of benefits penalties  may be waived or suspended with respect to certain offenders. For  example, the denial of benefits penalties are not applicable to individuals  who cooperate with or testify for the government in the prosecution of a  federal or state offense or are in a government witness protection  program. In addition, with respect to individuals convicted of drug  possession offenses, the denial of benefits penalties are to be “waived in  the case of a person who, if there is a reasonable body of evidence to  substantiate such declaration, declares himself to be an addict and  submits himself to a long-term treatment program for addiction, or is  deemed to be rehabilitated pursuant to rules established by the Secretary  of Health and Human Services.” Also, the period of ineligibility for the  denial of benefits is to be suspended for individuals who have completed a  supervised drug rehabilitation program, have otherwise been rehabilitated,  or have made a good faith effort to gain admission to a supervised drug  rehabilitation program but have been unable to do so because of  inaccessibility or unavailability of such a program or the inability of such  individuals to pay for such a program.
section_title: Administration of the Law
paragraphs: State and federal sentencing judges generally have discretion to impose  denial of federal benefits, under section 5301 of the Anti-Drug Abuse Act  of 1988, as a sanction. This sanction can be imposed in combination with  other sanctions, and courts have the option of denying all or some of the  specified federal benefits and determining the length of the denial period  within certain statutorily set ranges. When denial of benefits under section  5301 of the Anti-Drug Abuse Act of 1988 is part of a sentence, the  sentencing court is to notify the Bureau of Justice Assistance, which  maintains a database (the Denial of Federal Benefits Program  Clearinghouse) of the names of persons who have been convicted and the  benefits that they have been denied. BJA passes this information on to the  U.S. General Services Administration (GSA), which maintains the  debarment list for all agencies. GSA publishes the names of individuals  who are denied benefits in the Lists of Parties Excluded from Federal  Procurement or Nonprocurement Programs, commonly known as the  Debarment List. The Debarment List contains special codes that indicate  whether all or selected benefits have been denied for an individual and the  expiration date for the period of denial. Before making an award or  conferring a pertinent federal benefit, federal agencies are required to  consult the Debarment List to determine if the individual is eligible for  benefits.
The Department of Justice also has data-sharing agreements with the  Department of Education and the Federal Communications Commission.  The purpose of these agreements is to provide these agencies with access  to information about persons currently denied the federal benefits  administered by them. For example, as described in this report, students  who are convicted of offenses involving the sale or possession of a  controlled substance are ineligible to receive certain federal  postsecondary education benefits. In order to ensure that student financial  assistance is not awarded to individuals subject to denial of benefits under  court orders issued pursuant to section 5301, DOJ and the Department of  Education implemented a computer matching program. The Department  of Education attempts to identify persons who have applied for federal  higher education assistance by matching records from applicants against  the BJA database list of persons who have been denied benefits. Officials  at the Department of Education report that the department has matched  only a few records of applicants for federal higher education assistance to  the DOJ list of persons denied federal benefits. The individuals whose  names appear on the DOJ list may differ from those individuals who self- certify to a drug offense conviction on their applications for federal  postsecondary education assistance. (See app. III for more information on  this.)
The Administrative Office of United States Courts is responsible for  administrative matters for the federal courts. Shortly after the passage of  the Anti-Drug Abuse Act of 1988, AOUSC added the Denial of Federal  Benefits sentence enhancement to the Pre-Sentence Report Monograph,  which provided information to probation officers about the availability of  the DFB as sanction along with its requirements. AOUSC also developed a  standard form for federal judges to use in reporting the imposition of the  Denial of Federal Benefits sanctions; the form is part of the Judgment and  Commitment Order that is completed by the court upon sentencing.
The United States Sentencing Commission promulgates federal sentencing  guidelines and collects data on all persons sentenced pursuant to the  federal sentencing guidelines. After the passage of the Anti-Drug Abuse  Act of 1988, the USSC prepared a guideline for this sanction and included  it in the Sentencing Guidelines Manual. Annually, USSC distributes the  Sentencing Guidelines Manual to federal court officials.
section_title: Use of the Denial of Federal Benefits Program Provisions
paragraphs: Bureau of Justice Assistance data show that between 1990 and the second  quarter of 2004, 8,298 offenders were reported as having been denied  federal benefits by judges who imposed sanctions under the Denial of  Federal Benefits Program. About 38 percent (or 3,128) of these offenders  were denied benefits in state courts, and about 62 percent (or 5,170) were  denied benefits in federal courts. About an average 635 persons per year  were denied benefits under the program over the 1992 through 2003  period, and the number denied in any given year ranged from about 428 to  833. The number denied a benefit under the program decreased to 428 in  2002 and increased to 595 in 2003.
According to BJA data, judges in comparatively few courts used the denial  of federal benefits provisions. State court judges in 7 states and federal  judges in judicial districts in 26 states were reported to have imposed the  sanction. Among state courts, judges in Texas accounted for 39 percent of  the state court totals, while judges in Oregon and Rhode Island accounted  for 30 percent and 13 percent, respectively. Among the federal courts,  judges in judicial districts in Texas accounted for 21 percent of the federal  totals, while judges in North Carolina, Mississippi, Georgia, Florida,  Nevada, and Kansas accounted for between 8 percent and 15 percent of  the totals. Federal judges in each of the remaining 19 states accounted for  less than 3 percent of the federal totals.
Not all of the 8,298 offenders recorded as having been denied federal  benefits between 1990 and 2004 under the program are currently denied  benefits. For about 75 percent of these offenders, the period of denial has  expired. Officials at BJA report that as of April 2004, they maintained  about 2,000 active records of persons currently under a period of denial.
Relative to the total number of felony drug convictions, the provisions of  the Denial of Federal Benefits (DFB) Program are reportedly used in a  relatively small percentage of drug cases. For example, biannually  between 1992 and 2000, there were a minimum of 274,000 and a maximum  of 348,000 convictions for drug offenses in state courts, or about 307,000  per year. In federal courts over this same period, there were between  15,000 and 24,000 drug offenders convicted, or about 19,000 per year. As  the average annual number of drug defendants in state courts denied  benefits under the DFB was 223, the rate of use of the DFB in state courts  averaged about 0.07 percent. Among federal drug defendants, the annual  average number reported as having received a sanction under the program  was about 369, while the average annual number of drug defendants  sentenced federally was about 19,000; hence, the percentage of all federal  drug defendants receiving a sanction under the program was about 2  percent.
section_title: Assessing the Impacts of the Denial of Federal Benefits Program
paragraphs: Throughout the history of the program, questions have been raised about  its apparently limited impacts. In 1992, we reported on the difficulties in  denying federal benefits to convicted drug offenders and suggested that  there would not be widespread withholding of federal benefits from drug  offenders. Officials at BJA also reported that the sanction has not been  widely used by judges. In 2001, BJA program managers met with some U.S.  attorneys in an attempt to provide them with information about the  potential benefits of the program. According to BJA officials, the U.S.  attorneys responded that they typically used other statutes for sanctioning  and sentencing drug offenders, rather than the sanctions under the Denial  of Federal Benefits Program.
The benefits that can be denied under the program—federal contracts,  grants, loans, and professional or commercial licenses—suggest some  reasons as to its relatively infrequent use. Persons engaged in federal  contracting, for example, are generally engaged in business activities, and  such persons compose small percentages of federal defendants sentenced  for drug offenses. Hence, relatively few defendants may qualify to use  these federal benefits, and therefore relatively few may be denied the  benefits.
section_title: Reliable Data by Race of Persons Receiving the DFB Are Not Available
paragraphs: None of the data sources that we reviewed provided reliable data on the  race and ethnicity of persons denied federal benefits under the Denial of  Federal Benefits Program.
section_title: Appendix VI: GAO Contact and Staff Acknowledgments
subsections: section_title: GAO Contact
section_title: Acknowledgments
paragraphs: In addition to the contact named above, William J. Sabol, Clarence Tull,  Brian Sklar, DuEwa Kamara, Geoffrey Hamilton, David Makoto Hudson,  Michele Fejfar, David Alexander, Amy Bernstein, Anne Laffoon, Julian  King and Andrea P. Smith made key contributions to this report.