Since the passage of the welfare reform law in 1996, new state welfare policies promoting work, an expanded federal earned income tax credit, and strong economic growth have resulted in increased employment. Almost every state has witnessed a significant decline in its welfare rolls; nationwide there has been a 52 percent reduction in the number of families receiving cash assistance, from 5 million in 1994 to about 2.4 million in 1999. However, many recipients who have left welfare earn inadequate wages to support their families or have dropped off the rolls without work. Under the final federal welfare rules issued in April 1999, states were given increased flexibility in their use of funds to help low-income families in ways other than cash assistance. After three years of welfare reform, families in many states will he reaching time limits for receipt of cash assistance, which may bring into focus the unmet employment needs of families as Congress moves toward reauthorization of the welfare reform law. Given that states have substantial federal and state funds available to invest in needy families and limited time to help them move into work and self-sufficiency, all interested stakeholders look to reauthorization as a means to complete what welfare reform started.

Enacted August 22, 1996, the Personal Responsibility and Work Opportunity Reconciliation Act of 1996 (PL. 101-193) served as the Clinton Administration’s comprehensive welfare reform program. Its major component, known as the Temporary Assistance for Needy Families (TANF) block grant, provided federal funds to the states to give time-limited aid to families with children. Many families receiving TANE payments were required to work as a condition of receiving assistance. TANF replaced the former welfare program, Aid to Families with Dependent Children (AFDC), Emergency Assistance (EA) for Needy Families, and the Job Opportunities and Basic Skills Training program (JOBS). TANF combined funding streams from these programs into a single grant ($16.5 billion to states through 2002) and allocated dollars to each state equal to what the state received under the old AFDC program. The Balanced Budget Act of 1997 (P.L.105-33) established Welfare-to-Work (WtW) grants for TANF recipients and set aside 1 percent of funding (about $30 million over two years) for Native American WtW programs.

TANF authorized federally recognized Native American tribes or tribal consortia to apply for federal funding under Section 412 of the Social Security Act (SSA), as amended by P.L.104-193, to administer their own TANF programs, effective July 1, 1997. Tribes also have the option of allowing states to continue providing services to tribal families. Like the states, tribes were permitted to use federal welfare funds in any manner reasonably calculated to accomplish the four purposes of the act:

· To provide assistance to needy families so that their children may be cared for in their own homes

· To end the dependence of needy parents on government benefits by promoting job preparation, work, and marriage:

· To prevent and reduce out-of-wedlock pregnancies; and

· To encourage the formation and maintenance of two-parent families.

Welfare reform also appropriated funding for the former tribal JOBS program to provide for work activities under the Native Employment Works program (NEW), effective from fiscal year (FY) 1997 through FY 2002. The NEW program was designed for tribes to promote work activities, to provide services supporting participation in work activities, and to create and expand employment opportunities if possible.

Welfare reform provided states and tribes with flexibility in designing and implementing innovative approaches to meet the needs of families within their own unique settings, moving them to work and self-sufficiency. Under P.L.104-193, administration of welfare policy devolved to the states and tribes, limiting the federal government’s regulatory enforcement role, but allowing the federal government to track state and tribal TANF performance data. Tribes that run their own TANF or NEW programs have discretion in defining eligibility, benefits, services, and policy to move recipients to self-sufficiency. Tribes may also enter into partnerships with states to provide American Indian families with necessary support services such as child care and child support enforcement.

On September 21,1998, the APHSA submitted to the federal government comments on tribal TANF regulations. In February 2000, tribal TANF regulations underwent further changes as issued under the Administration for Children and Families’ (ACF) final rule for tribal TANF plans, Federal Register, Vol. 65, No. 34. This final rule implements the provisions of P. L 104-193, giving tribes the opportunity to create their own TANF programs or to participate in state-operated TANF programs. This article provides an overview of APHSA’s positions on the new tribal TANF laws and examines the impact of TANF on tribes and states.

In 1998, API-ISA urged ACF to promote an open and mutually agreeable relationship between states and tribes, as the tribe defines the service area. In its final rule, ACF incorporated this element. Tribes are permitted to define their own service populations and have the flexibility to serve all Native American families within the service areas or solely the enrolled members of the tribe as indicated in the tribal TANF plan application. However, if the tribe chooses to include non-American Indian families in its service area, the tribe and state must agree to the inclusion. Definition of the service population provided by a tribe determines what data the state must provide to calculate the amount of the Temporary Family Assistance Plan (used interchangeably with tribal TANF plan) grant that is subtracted from the state block grant.

Under the old rules, states were given 21 days to respond to an ACF request for data to determine the amount of the tribal TANF grant. APHSA wanted no fewer than 45 days to comply and requested a more consultative process in which the state and tribe could respond simultaneously to create a mutually acceptable result. In its final rule, ACF gave states 30 days to submit data, after which time and in the event of non-compliance, ACF gives the affected tribe 45 days to submit its own data. These time periods will allow sufficient time for the state to gather the expenditure data and sufficient time for the tribe to agree or disagree with the state data. In the absence of state data, ACF will consider, and tribes may use, relevant data from the Census Bureau, the Bureau of Indian Affairs, and other federal programs and tribal records as the basis of their grant.

In 1998, APHSA asked ACF to recognize the need for states to be notified of a tribe’s desire to terminate its grant prior to the end of its three-year plan. APHSA asked that a tribe simultaneously inform ACF and the state of its intention to end the program. The association also asked that ACF offer guidance as to how a tribe should proceed in terminating its TANF plan and how states and tribes should handle the situation when the tribal TANF block grant is exhausted before the end of the fiscal year. In 2000, tribes wishing to terminate their TANF grant may do so by notifying the secretary of the Department of Health and Human Services (HHS) no later than 120 days prior to the effective date of the termination. Or, a tribe must send written notice of termination to the secretary no later than 30 days prior to the effective date of the termination that has been agreed upon by the tribe and the affected state(s). The final rule holds that if a tribe expends all of its TANF grant before it retrocedes the program and such expenditures reasonably accomplish the purpose of the statute, the federal government has no authority to augment state TANF funds to absorb any returning caseload, subsequent to retrocission.

Regarding administrative caps, APHSA called for a flexible cap that could go beyond 20 percent for the first two years a tribe operated a TANF program. This would allow for startup costs for some tribes that may not be accommodated by an across-the-board cap. ACF, in its final rule, set out a federal framework but does not fully define "administrative costs." It recognized the unique administrative burdens on tribes that have never operated a comprehensive human service program and who need to build an infrastructure capable of sustaining a tribal TANF program. Tribal applicants and ACF will negotiate (for each year of operation) an administrative cap not to exceed 35 percent for year one, a negotiated administrative cap not to exceed 30 percent for year two, and a negotiated administrative cap not to exceed 25 percent for all subsequent years of operation.

In 1998, APHSA opposed ACF’s interpretation that ACF lacked the statutory authority to allow tribes to carry over unobligated TANF block grant funds from fiscal year to fiscal year. The association thought that tribes should have the same flexibility as states in carrying over TANF funds to address an array of recipient family needs and to promote program innovations. However, the Foster Care Independence Act of 1999 (P.L.106-169) enacted on December 14, 1999, included a number of technical corrections to the welfare reform law and made section 404(e) of P.L.101-193 applicable to the tribes. Under this amendment, tribes may reserve amounts awarded to the tribe under section 412, without fiscal year limitation, to provide assistance under the tribal TANF program. Federal unobligated balances carried forward from previous fiscal years may only be expended on assistance (as defined under Section 286.10) and related administrative costs associated with providing such assistance. Tribes must obligate by September 30 of the current fiscal year any funds for expenditures on non-assistance. Tribes must liquidate these obligations by September30 of the immediate succeeding federal fiscal year for which the funds were awarded.

APHSA raised concerns over mandated data collection for TANF under Subpart E and believes the reporting requirements far exceed the elements required under Section 411 (a) of P.L 101-93. The burden on tribes is even greater considering the cost and complexity of establishing a new TANF data-reporting program. Under the final rule, ACF set out data collection and reporting regulations and applies a definition of "TANF family" to both tribal and state TANF programs. A TANF family includes those persons in a family who receive assistance under the tribal TANF program (and non-custodial parents participating in work activities), parent(s) or caretaker relative(s) of any minor child receiving assistance, minor siblings of any child receiving assistance, and any person whose income and resources would be counted in determining the family’s eligibility for or amount of assistance. The definition of TANF family is not overly burdensome to tribes because the additional persons are part of an aided child’s immediate family or have their income or resources considered in determining eligibility. ACE seeks to obtain data that will be as comparable as possible under the statute to assess program performance and impact of program changes on families and children, and to inform the public of the progress of welfare reform. ACE’s limited reporting requirements to those categories of persons on whom the tribes and states will gather data for their own purposes and for which information will be directly relevant to the administration of the TANE program.

Despite APHSA’s opposition to the creation of the NEW program in 1998, ACF provided funding to those tribes that operated a tribal JOBS program in FY 1995 for the purpose of providing work activities whether the tribe decided to operate its own TANF plan. States raised concerns over the proposed regulation of this separate jobs program because it does not target the TANF population. The NEW program focused on general assistance recipients, non-custodial parents, teen parents, seasonal workers, unemployed parents, veterans, ex-offenders, and other groups. Funds are provided to tribes and inter-tribal consortia to administer NEW programs in FY 1997 through FY 2002. The funding level is statutorily set to remain at $7.6 million for each fiscal year (the original FY 1994 JOBS grant amount). Funds must be used to operate programs that make work activities available to populations and service areas as specified by the grantee. Unspent NEW program funds may not be carried forward to the next year as carrying over has not been specifically authorized by legislation.

Historically, tribal, state, and federal governments have wrangled with the issue of sovereignty. During the 1990s, Congress passed legislation that affected the exercise of tribal self-government adversely. The legislation threatened Native American government’s abilityto serve its communities, to enforce treaties, to recover land, raise revenue, and to maintain hunting and fishing practices. In many instances, tribal members who seek employment are forced to leave their reservations and be removed from their culture and people, or stay and live in poverty or without work. Tribal sovereignty is the backbone supporting the cultural richness of American Indian society and its people, a concept that is inherent in every Native American community, and one that has been largely ignored in the welfare policy debate. Some tribes viewed the 1996 welfare reform law as an undermining of the relationships established in treaties with federal government, not the states. Tribal governments were not consulted in the drafting of welfare reform legislation. Consequently, reauthorization allows tribes to engage in the mainstream policy debate and to correct problems they see with devolution of welfare to the states. For Native Americans, welfare reform should not be limited to a means of job creation, but used as an opportunity for long-term economic reform in their communities.

Generally, the states encourage effective interaction between the two governments and are willing to shed light on the issues facing indigenous Native American populations. The amount of tribal TANF funding is based on federal expenditures for Native Americans in state FY 1994. These funds are subtracted from the state TANF grant and have a significant impact on states that must meet work participation rates. State governments are the primary providers of TANF for tribes and have interests in developing effective tribal TANE policy. Issues such as providingtribal TANE programs with state maintenanceof-effort (MOE) funds, service delivery systems, and tribal access to state systems are of extreme importance. State legislators are the budget appropriators for state programs and they decide whether to provide tribal TANF programs with state MOE funds.