States Hoard Federal Assistance Funding Amidst Record Poverty Levels

by Vins
Published: Updated:

Despite the national poverty rate making its largest upward jump in recorded history, states stockpile $5.2 billion in undistributed funds from the federal Temporary Assistance for Needy Families program (TANF). A collection of articles published by ProPublica in 2021 detail the regulations allowing for this discrepancy and the impact the widespread denial of assistance is having on those in desperate need.

Hannah Dreyfus extrapolated from recently released federal data in her December 29, 2021 article, reporting that the number of approved applications for access to TANF funding have been cut in half since 2010 as guidelines to qualify become increasingly exclusionary, while in the same time period reserved TANF funds have more than doubled.

Dreyfus profiles Bonney Bridgforth, a single mother of 4 children, who was forced to work at just a dollar above Maine’s minimum wage while pursuing her associates degree to meet the “employment” qualification for TANF funding. However, Bridgforth would soon be notified that her family no longer met the “deprivation” standard to receive aid after her estranged husband was released from prison after serving a sentence for possession of child pornography. Dreyfus noted that, “The same year Bridgforth was kicked off TANF, Maine was sitting on $111 million in unspent welfare dollars.”

The stories of struggling families like the Bridgforths illustrate a larger problem stemming from the fallout of a 1996 welfare reform law passed by the Clinton administration allowing states to withhold assistance, despite having a larger stockpile of reserve funding than ever. The 1996 law awards states an up-front block grant each year, intending for the money to go toward helping the poor meet their basic needs. However, Eli Hager pointed out in his December 23, 2021 article that states are allowed to spend this money in any manner they see fit, so long as it meets one of four very broad and abstract criteria established by the Department of Health and Human Services.

Hager spoke with Arianna Bermudez who described her experience with the state of Arizona that “spent some of the same welfare funding that [the state] could have used to provide her with direct assistance to instead help pay for a child protective service investigation into her emotional state.” Hager had previously investigated for ProPublica in September of 2021 and discovered the deeply personal details mothers are often forced to disclose in these state investigations as a standard practice in determining if they qualify for a negligible portion of states’ hoarded funds. A similar December 2021 investigation by Hager found equally disturbing practices in Utah, as a family on the verge of homelessness denied federal funding was directed to the Church of Latter-day Saints where they would be forced to convert in exchange for being given food.

Some state officials argue that the decreasing number of applications for TANF money speaks to the states’ ability to get families out of a position of needing assistance. The Center on Budget and Policy Priorities has overwhelming data to suggest the opposite. Adita Shrivastava and Gina Thompson’s February 18, 2022 report shows that the TANF-to-poverty ratio hit an all-time low in the program’s 25-year history amid the COVID-19 pandemic.

The corporate media has helped states keep their billions in undistributed assistive funds a well-kept secret. Outside of local reports and independent journals such as Consortium News, which ran Dreyfus’s original report, there has been no apparent effort to explore and raise awareness about the 1996 welfare law allowing states to collect federal funding without using it for its unmistakably essential purpose.

Adita Shrivastava and Gina Azito Thompson, “Policy Brief: Cash Assistance Should Reach Millions More Families to Lessen Hardship,” Center on Budget and Policy Priorities, February 18, 2022.

Eli Hager, “A Mother Needed Welfare. Instead, the State Used Welfare Funds to Take her Son,” ProPublica, December 23, 2021.

Eli Hager, “These Single Moms Are Forced to Choose: Reveal Their Sexual Histories of Forfeit Welfare,” ProPublica, September 17, 2021.

Eli Hager, “Utah Makes Welfare So Hard to Get, Some Feel They Must Join the LDS Church to Get Aid,” ProPublica, December 2, 2021.

Hannah Dreyfus, “State Are Hoarding $5.2 Billion in Welfare Funds Even as the Need for Aid Grows,” ProPublica, December 29, 2021.

Student Researcher: Zach McNanna (North Central College)
Faculty Evaluator: Steve Macek (North Central College)