In 1995, Massachusetts was ahead of the welfare-reform curve, adopting guidelines aimed at moving welfare recipients from public dole to employment payroll a year before federal legislation was passed to do the same thing. But since then, the state has gone from leader to laggard, and it now faces the loss of federal funds if it doesn’t catch up. Problem is, catching up could get tougher if Congress tightens welfare work rules even more, as seems likely. Either way, Massachusetts could maintain some of its more generous supports for welfare recipients, but only if it pays for them with state funds rather than federal dollars—an option favored by some Democratic lawmakers.
How far has the Bay State fallen off the national pace? Since passage of the federal welfare reform law in 1996, the nation’s poverty rate has dropped 2 percent, but in Massachusetts, it’s fallen only one-tenth of a percent. Across the country, welfare caseloads have declined by 60 percent; in Massachusetts, by 53 percent. And when it comes to the proportion of welfare recipients who are employed, Massachusetts ranks 47th among the 50 states, with just 20 percent of the state’s welfare recipients holding jobs.
“The welfare policies that Massachusetts instituted in 1995 were ahead of their time,” Gov. Mitt Romney said in January. “But the times have changed, and we now lag behind the rest of the nation.”
That’s in part because Massachusetts has been running its welfare system under a 10-year waiver granted by the federal government in 1995. Issued prior to the federal law, the waiver allows the Bay State to operate under rules that seemed tough at the time but are now less stringent than those in force across the country. The waiver expires in September, which means that Massachusetts will have to comply with federal strictures if it wants to hold onto the $460 million it now receives for welfare benefits and related programs. So Romney is campaigning to revamp the state’s welfare rules, requiring that more recipients work and that those who work toil longer hours.
Under Romney’s proposal, all adult welfare recipients with children over a year old would be subject to work requirements. Current rules exempt parents with children up to age 2. Romney’s plan would also increase from 24 to 30 the number of hours per week that a welfare recipient must work if his or her child is over 6 years old. Recipients with children under age 6, but over 1, would continue to be required to work 20 hours a week. The rules would, for the first time, count community service, education, and job training as work for one year—a substitution long sought by human services advocates but resisted by Romney’s Republican predecessors. The Romney proposal would also set a lifetime limit of five years for the receipt of welfare benefits, in keeping with federal rules, and maintain the state’s current cap on benefits of two years in any five-year period.
This plan to bring Massachusetts into line with federal rules has already drawn fire from advocates for the poor, and from some Democrats on Beacon Hill. One point of contention has to do with recipients who are disabled. Some advocates pointed out that the changes necessary for conformity would mean that 5,600 recipients certified as disabled by the state, but not by the federal government, would have to go to work or lose their benefits.
“Many parents with disabilities want to work, but not all can,” says Deborah Harris, staff attorney at the Massachusetts Law Reform Institute and member of a state commission established by the Department of Transitional Assistance to guide the state’s move toward compliance. “You don’t help families by cutting off their benefits.”
DTA Commissioner John Wagner says those currently considered disabled by the state—and exempted from work rules—might find employment if more is expected of them. For those required to work under the Bay State rules, the system has worked well, he says, pointing to a study of state welfare recipients who left the rolls in 1998 and 1999. The study found that nine out of 10 had been employed at some point after leaving welfare, and seven out of 10 were still working 10 months later. And Wagner says the state stands ready to help, investing in assessments to gauge the recipient’s ability to work and providing supports, such as child care and transportation, to help them hold down a job. Even working 20 hours a week at minimum wage, he says, is enough for a welfare recipient to earn more than the federal poverty level, when state and federal earned income tax credits are considered.
ll this may be just the start of Massachusetts’s welfare readjustment if Congress revamps—and toughens—the federal rules. The federal welfare reform law first came up for reauthorization in 2002, but Democratic senators have stopped it so far, forcing Congress to pass continuing resolutions that maintain the 1996 rules and funding levels. When the House passed a reauthorization bill in 2003, all 10 Massachusetts representatives voted against it. Sen. Edward Kennedy blocked a vote in the Senate by insisting that the bill include an amendment increasing the federal minimum wage. But Democratic losses in the 2004 election may make the party skittish about standing in the way again.
The House bill, which will likely re-emerge this year, would require states to have 70 percent of their caseloads working nearly 40 hours a week. Limited exceptions to the work requirement allow for recipients to pursue vocational course work and college educations full time for four months every two years, and 16 hours per week after that.
For Massachusetts, where only 20 percent of the caseload is working, meeting those standards would be a challenge. But the Bay State shouldn’t look for any relief from Congress, where the Republican majority is likely to be listening to the libertarian Cato Institute, a Washington think tank. A Cato report from last October called the Bay State’s work requirements “among the most lenient in the country” and “a significant contributor to Massachusetts’ lackluster performance in moving people toward self-sufficiency.”
Even if Congress moves toward tightening welfare work rules, some in Massachusetts will be pushing for the state to provide more leniency—and more support—for recipients with state funds. Some 25 states have opted to pay certain welfare benefits on their own in order to offer more generous benefits than allowed under federal guidelines. State Sen. Cynthia Creem, a Newton Democrat, and Rep. Antonio Cabral, a Democrat from New Bedford, have proposed legislation to do just that, but its prospects are unclear given the fiscal constraints the state is under. Currently, Massachusetts spends an annual $360 million to supplement federal benefits.
Human services advocate Deborah Harris says the state should continue to support disabled recipients—those who can’t work—with state funds, as it does now. This would not only give recipients the assistance they need, it would also remove them, as state-only beneficiaries, from the federal work-rate calculation.
Jeffery Hayward, vice president of public policy at the United Way of Massachusetts Bay, who chaired the DTA commission, supports the change in disability policy but wants to see continued work exemptions for women with children under age 2, as well as women in the late stages of pregnancy, along with in-depth assessments by caseworkers that kick in when a recipient is in danger of losing benefits for failing to comply with welfare rules.
Another area where advocates want a state-only system is in education and training. Based on the past House bill, Congress wants to strictly limit education as a work substitute, but the United Way wants more education and training to count against welfare work requirements than even Romney would allow. A program run by the United Way to train people in medical billing, says Hayward, has boosted the trainees’ earning potential.
“We put them through a 16-week training program, and then they receive starting jobs with $22,000 salaries and benefits,” says Hayward. “To us that makes a lot of sense.”
Romney has pledged to invest $8 million in education and training programs for welfare recipients, and another $1.9 million to hire more caseworkers who are trained in screening recipients and determining whether they can find employment. Hayward says that’s a good start; Harris says the training funds are not nearly enough.
Meanwhile, in Washington as in Boston, Democrats may find some success in pushing for more funding for child care to accompany heightened work requirements. A year ago, before the reauthorization bill died, Sen. Olympia Snowe, a Maine Republican, won a 78-20 majority for her amendment to add $6 billion in child care funding over five years. Romney’s proposal would kick in an additional $6.4 million in state funds for child care, though Harris says that’s enough to cover only 800 of the 22,000 children who will need it if Romney’s proposal is passed.
US Rep. John Tierney, a Salem Democrat who sits on the committee with responsibility for overhauling the 1996 federal law, thinks the next stage of welfare reform should focus on ensuring that those leaving the rolls are, indeed, finding work. He supported a Senate amendment to the recent House bill that would have provided a credit against the work requirement to states that could demonstrate that those who’d left the welfare rolls were working.
“The mindset and inclination towards work” sparked by the 1996 reforms is “a good thing,” says Tierney, but adds, “we’ve only been partially successful. A wide swath of people hasn’t been reached yet.” Whether efforts to reach them rely more on the stick of work requirements or the carrot of education and training will be at the heart of this year’s debate, on Capitol Hill and Beacon Hill alike.