Hard to Place...Population...Strategies/Part I of II [via Sonny]

Tom Boland (wgcp@earthlink.net)
Mon, 13 Apr 1998 03:21:15 -0700 (PDT)

FWD via "H. C. Covington" <ach1@sprynet.com>

The Hard-to-Place: Understanding the Population and Strategies to Serve

By Fredrica D. Kramer

March 1998


The strict work requirements and lifetime limits to benefits imposed by the
Personal Responsibility and Work Opportunity Reconciliation Act of 1996
(PRWORA) are forcing states to look at portions of their caseloads that
have largely escaped close scrutiny because they were assumed to be harder
to place and previous law permitted many such individuals to be exempted
from work requirements. But the new law will force states to serve both
those with recognizable and assumed barriers to employment, and those who
simply stay on the rolls for long periods of time or who cycle on and
off, either because of unrecognized disabilities or for other reasons.

Both groups are at risk of hitting their lifetime limit to benefits while
remaining in precarious economic and social circumstances. Some may be made
more employable with interventions that are responsive to identified
special needs. But more needs to be known about how and when conditions
handicap recipients=92 ability to work, what portion of the cyclers or
longstayers are in fact those with unidentified handicapping conditions,
and what interventions would help these recipients hold onto jobs they
get and improve their employment status over time, in order to be
economically self sufficient in the long term.

Because of the breadth of the topic, this Issue Note offers a baseline for
understanding the challenge to state and local policymakers of serving this
population: notably, who and how many in the caseload might be hard to
place; how other policies, such as sanctions and time limits, might
interact with chosen service strategies; what protocols, assessment
instruments and other management strategies can be used to assess the
extent of their problems; and what program and funding strategies within
TANF or elsewhere might be used to serve them more effectively. This Issue
Note may supplement but does not deal in depth with issues covered in WIN
Issue Notes on substance abuse (January 1997), domestic violence (September
1997), and education and training (March 1998). Future WIN publications
will offer more detail on particular subgroups, service strategies and
program examples.

Policy Issues

A state's choices as expressed in the definition of work participation and
use of exemptions, type and sequencing of assessments and services,
staffing structure, use of TANF funds for non-TANF services will represent
overall program philosophy and policy. The following discussion offers a
glimpse at the choices states may make to accommodate those with
significant barriers to sustained employment.

Who should be considered hard to place? The severity of a personal or
family problem and its influence on employability vary greatly across
individuals, but the list of potential barriers is barriers is extensive.
It should include a history of alcohol, drug abuse,
criminal record or ongoing (criminal or civil) legal entanglements,
domestic violence or involvement with the child welfare system, physical or
mental disabilities or chronic health problems, developmental or learning
disabilities, language barriers, protracted caretaker responsibilities both
for chronic health problems (asthma is particularly prevalent in low income
populations), or behavioral problems of children, or other incapacities of
family members.

In addition, recent analyses of national survey data indicate that
extremely low basic skills play a much greater role in long-term welfare
use than previously thought. Also, though rigorous research here is only
just emerging, the frequently unstable lives of the very poor,
characterized by persistent family problems, housing instability, and a
variety of assaults to basic coping, as evidenced by low self-esteem or
depression, is often associated with persistent use of welfare. Indeed,
housing instability or homelessness may be the result of domestic violence,
child behavioral problems or substance abuse. While often overlooked,
seemingly less serious problems such as obesity, high blood pressure or
other health problems related to poor nutrition, narrow employment options
for many low income individuals. Creating a category of hard-to-place may
allow states both to be alert to problems that may appear at intake and
begin services early, and to revisit problems over time in order to assist
those whose needs surface only as they cycle back to welfare or from job to

Interaction of work requirements and time limits for the hard-to-place.
PRWORA allows 20 percent of the caseload to be exempted from the five-year
lifetime limit to benefits. PRWORA also mandates that each recipient
participate in an employment-related activity after 24 months, though those
who are exempted will still be part of the denominator that establishes the
state's work participation rate, unless they have a child under age one.

Many individuals with potential barriers do in fact work, but those with
substantial barriers work less. The numbers of recipients with potential
barriers far exceeds 20 percent, though their severity and their impact on
employability is not well established. Although the time limit exemption
and the work requirements were clearly thought of as separate issues, as
increasing numbers of the caseload are required to participate in work (50
percent by 2002, unless adjusted to reflect overall caseload declines), the
numbers of harder-to-place and longstayers will begin to converge with
those who must participate in work and those who cannot be protected by the
20 percent exemption. Traditional policies to increase work, such as
expanded income disregards, early evaluation findings would suggest, are
unlikely to be effective for those with limited education or work history.

Effect of sanctions policies on the hard-to-place. Tougher sanction
policies and certain aspects of Work First strategies may have to be
refashioned in the context of a caseload increasingly made up of those with
substantial employment barriers. New data show that although many comply
with the work requirement under stiff sanction policies, many who do not
have serious personal or family problems that render them less able to
work. In Minnesota, sanctioned families were four times as likely to report
chemical dependence, twice as likely to report mental health problem, twice
as likely to report family violence, and three times as likely to report a
family health problem. In Michigan, sanctioned families in the JOBS program
were 50 percent more likely to have had contact with child protective
services (Pavetti, August 1997).

Noncompliance may also result from clients failing to understand program
rules and expectations, a problem of particular relevance to individuals
with low social or cognitive skills. In Utah, about half those threatened
with termination had serious family or personal problems or did not
understand the mandates. In Iowa, half the households who were sanctioned
were not employed. States might be wary of pushing troubled families off
the rolls, even inadvertently, as a result of tough sanctions policies.

Use of exemptions and other work alternatives for the hard-to-place. Though
many states plan to exempt for certain disabilities, exempting routinely
for some categories, such as substance abuse or extremely low basic skills,
may be politically untenable. It may also neutralize the power of the work
requirement to impose services on those who need them and weaken the
justification for expending resources on individuals who are not required
to participate. In any case, many personal and family problems are
unrecognizable by easily administered tools. Further, strategies to treat
the hard-to-place, by their nature, take time to succeed, so states will
need to invest resources early in order to avoid such
individuals' increasingly substantial portions of the caseloadshitting the
time limits without resources of their own to maintain economic
independence. Some states are adopting a no exemption, so-called
saturation, policy precisely because they feel obliged not to squander
recipients=92 time on TANF.

Arguments have been made to exempt families with evidence of domestic
violence (states can be held harmless if their 20 percent exemption is
exceeded due to such cases). But states need to be cautious that exemptions
do not cause such families to be overlooked in allocating services and case
management resources. Welfare may be the route toward independence for many
battered women. Indeed states may want to make an effort to reveal a
variety of family circumstances, including mental health and other
treatment needs, and refer and track families who would otherwise be lost
to the social service system only to reappear in crisis.

States who take the position that every recipient must participate in some
fashion may, as Utah has done, broaden the definition of participation so
that any activity that increases family income=97e.g., working with a social
worker to receive SSI, getting treatment or remaining on a waiting list for
a mental health services, working at home caring for someone disabled will
count as participation.

On a related issue, states may find ways to use the protections of the 1990
Americans with Disabilities Act to work with employers so that recipients
with special needs can be accommodated in the workplace in jobs that take
advantage of the skills they have.

Research Findings

Prevalence of potential employment barriers. Overall, according to analyses
of women ages 26-33 in the National Longitudinal Survey of Youth (NLSY),
more half the women who received welfare in 1991 experienced a serious form
of at least one potential barrier (low basic skills, physical disability or
health limitation, or mental health issue) and 35.4 percent experienced a
more moderate form or had a child with a chronic medical condition.
Barriers were markedly more prevalent among women on welfare than others in
the survey, and among those on welfare for longer periods of time. The NLSY
probably underreports mental health issues, does not address domestic
violence at all, and probably underrepresents the barriers of those
remaining on the caseloads today. (Pavetti, August 1997).

Disabilities. Analysis using three national surveys (Loprest and Acs, 1996)
found nearly 30 percent of AFDC families had a woman or child with some
disability, and about 20 percent had a disabled mother or severely disabled
child. Between 16.6 and 19.2 percent of AFDC mothers had a work limitation.
Over 10 percent reported a serious disability (impeding basic functions
such as dressing, eating or getting around the house), and another nearly
10 percent had difficulty with an "instrumental activity of daily living"
(e.g., seeing ordinary newsprint, hearing or understanding speech, certain
ordinary household management tasks). Since states have become reasonably
astute at using SSI, the researchers assume that women surveyed were on
AFDC because the disabilities reported, though severe, would not qualify
for SSI coverage. Another survey (Meyers, et al., 1996) found 43 percent of
California AFDC households had mothers or children with disabilities or
chronic health problems.

Low Basic Skills and Learning Disabilities. In the NLSY, fully 65 percent
(compared to 22 percent for those not on welfare) measured in the bottom
quartile of the Armed Forces Qualifying Test with 33 percent measuring in
the bottom decile, that is, 3rd or 4th grade level. The Washington State
Learning Disabilities Initiative found 54 percent of JOBS participants had
special learning needs, 35 percent were specifically learning disabled (a
significant difference between estimated ability and performance), 14
percent were slow learners (IQ of 70-80), and 5 percent showed mild mental
retardation (IQ below 70). In its own initiative, Kansas also found high
levels of learning disabilities in its AFDC population. The Kansas project
also found about one-third of Caucasians in their sample learning disabled,
compared to 19 to 46 percent for people of color depending on the
measurement method used, suggesting that screening tools must be
particularly sensitive to ethnic or cultural bias.

Substance Abuse. Over one-third in the NLSY analysis reported some form of
alcohol or drug use, while data from three other sources report between
16.4 and 20 percent of welfare recipients have alcohol or drug problems.
The National Household Survey on Drug Abuse (NHSDA) estimated that 5.2
percent of AFDC recipients ages 18-44 had significant alcohol or drug
related impairment, and 11.2 percent were somewhat impaired (compared to
2.6 and 9 percent for non-recipients). The 1992 National Longitudinal
Alcohol Epidemiologic Survey estimated 17.9 percent of welfare recipients
are drug or alcohol dependent, compared to 8.9 percent for non-recipients.
The National Center on Addiction and Substance Abuse reported 20 percent of
welfare recipients are drug or alcohol addicted. Program-specific estimates
are somewhat higher.

Domestic Violence. Studies of several welfare and employment and training
programs have found at least 50 percent of participants who were receiving
AFDC had experienced domestic violence (see Lyons, 1997). Other research
indicates that domestic violence has a marked effect on security,
tardiness, absenteeism and other workplace productivity issues.
Importantly, evidence is emerging that partners may actively interfere with
education and training, and that participation in work and training
activity itself may bring on abusive behavior in boyfriends and other
family members (see Olson and Pavetti, 1996). Of special concern is that,
because of fear and embarrassment, abusive relationships are not often
reported until the situation is out of control.

Other Problems. There are a range of problems that anecdotal evidence, if
not systematic documentation, would suggest are likely to interfere with
successful transitions from welfare to work. For example, the prevalence of
mental illness in the AFDC population is not well documented, though
program-specific data (e.g., Fulton County GA, Iowa, Riverside GAIN, New
Chance) indicate potentially high rates of depression and other mental
health issues. The Loprest and Acs analysis found high health care use
among AFDC women=97in the one year measured, 10 percent had hospital stays,
nearly 9 percent had 16 or more doctor visits, and 7 percent were confined
to bed for over 30 days.

The extent of health and behavioral problems of children is hard to assess
though program-specific data show barriers to JOBS participation due to
child behavioral or medical problem was not insubstantial. Loprest and Acs
found between 11.1 and 15.9 percent of AFDC children had some activity
limitation, almost 4 percent had one or more chronic conditions, and over
14 percent of school-age children had some special need (e.g., special
classes, or limitations or inability to attend school). Estimates of the
rates of involvement with child protective services are relatively small,
but may be twice as high for low income families as for children nationally
(Olson and Pavetti, 1996). Other researchers note that single parents with
multiple children or children with disabilities or behavioral problems have
multiple appointments and other additional demands to contend with, and it
is difficult to find jobs in the low wage, low skill labor market likely to
accommodate such demands.

Housing problems, legal problems, and other domestic difficulties, though
less well documented, are seen by program administrators to contribute to
chronic welfare use. The New Chance program reported nearly 50 percent had
a housing problem that interfered with their ability to participate. An
analysis of Kansas=92 cases on over 60 months found half had moved in the
past 10 months and one-third had moved two or more times. Thirty-two
percent had no telephones, 9 percent were sharing living space with one or
more households, and 18 percent had at least one disabled individual in the
household (contact Candy Shively, 913-296-6750).

Relationship to Work. While many do work, most with personal and family
challenges do not work continuously or for substantial portions of the
year. About one-fifth of those reporting barriers to employment in the NLSY
worked half the time or more. About a third of the recipients in each of
the broad categories of barriers (medical problems, children's medical
problems, mental health problems, alcohol/drug use, low skills) did not
work at all.

Between 55 to 70 percent, depending on the barrier, worked less than 25
percent of the time or not at all during the during the three years covered
in the survey. Importantly, fully 44.4 percent of those with extremely low
skills did not work at all, while only a quarter of those reporting
alcohol/drug use the barrier least affecting work worked half the time or
more (Pavetti, August 1997). And in another analysis, Pavetti estimates
that women with similar characteristics to welfare mothers were unlikely to
transition from bad to good jobs or work steadily=9740 percent worked
steadily but in bad jobs by ages 26 and 27, one-third worked only
sporadically, and for those who had not completed high school 52 percent
worked only intermittently, and 34 percent worked steadily in bad jobs
(Pavetti, July 1997).

Using SIPP data, Acs and Loprest found that a woman with no disabilities or
disabled children had a 7.4 percent chance of leaving AFDC to work in any
four month period, a 3.7 percent chance if she had a functional limitation,
and a 2.3 percent chance if she had severe limitations. The probability of
exiting for reasons other than work for women with children under 6 with a
disability, however, is 28.8 percent, compared to 5 percent for those
without disabled children, suggesting that some of these children may move
from AFDC to SSI. The researchers point out that since these data are self
reported and do not fully capture mental or emotional disorders or
substance abuse, they may understate the level of work impairment.

A recent Urban Institute review of the effects of traditional program
models suggests that sanctions, time limits and expanded income disregards
alone will have limited success with those with substantial barriers. The
relatively positive effects of Work First strategies, such as those
reported for Riverside GAIN or the saturation model of San Diego's SWIM
program, may not hold for this population in Riverside, 35 percent were
exempted due to medical, drug, emotional or mental, or legal problem, and
in SWIM the most disadvantaged were no better off having left the rolls.
Although the precise effect of the intervention is hard to tease out, other
models such as supported work, and more proactive case management or
enhanced supportive services offer more promising employment outcomes for
families with greater needs (for a review of the literature and possible
models, see Pavetti, et al., 1997).

Program Options

Identifying the hard-to-place. One function of assessment is to make broad
program planning and resource allocation decisions=97for instance, how
heavily to rely on exemptions or whether to employ a saturation model that
attempts to serve all recipients. Another function of assessment is to
determine what services to provide to individuals, and whether to provide
them within TANF or to divert clients (both new applicants and current
recipients) to other service providers and other funding streams.

In a time-limited environment states should start by identifying the
longstayers in their current caseload research would suggest that any
recipient with longer than two years of welfare receipt ought to be
considered a potential longstayer in order to assess their personal and
family profile and potential barriers to employment. However, predicting
longstayers with commonly used intake procedures has proven difficult, and
some programs that deal exclusively with the harder-to-serve find that even
obvious problems such as substance abuse may not be good predictors of
employment patterns. It may be the confluence of many problems e.g.,
multiproblem families or substance abuse combined with low skills and low
self esteem that together make steady employment elusive.

Assessment tools. Though all states have some mechanism to do employability
assessment, no single instruments have been shown to satisfy all intake
screening demands, and many needs reveal themselves only over time. Some
states do extremely cursory initial screening and rely on the labor marke=
using job search and job experiences over time, to reveal barriers. A
saturation model without elaborate screening could "smoke out" those with
special needs simply by subjecting all recipients to some form of work
related activity. And elaborate assessment tools could waste resources on
those who would exit on their own. But, it has been noted, relying solely
on the market as the sorting tool of first resort does not provide a way to
learn why some clients fail, to be alert to crises such as domestic
violence, to protect recipients from crises brought on by the work
requirement itself, or to protect recipients virtually unable to
participate from being forced off welfare without getting needed help.
Because of time limits many states are now attempting to focus on assets
rather than barriers in order to craft assistance strategies for the
greatest number. In a saturation model such as Utah's, the employment plan
and the supportive services necessary to implement it precede more
elaborate diagnostic assessment, in order to avoid biasing the
service response toward a focus on barriers. But specialized staff are
deployed throughout the system and, much like an employee assistance plan,
available when a problem emerges.

There are reliable instruments for identifying specific problems that might
lead to long-term dependence, and which can be addressed with discrete
service strategies. A variety of well-tested paper assessments can screen
for alcohol and drug problems and are in use by welfare offices (e.g,
Substance Abuse Subtle Screening Inventory (SASSI), Short Michigan
Alcoholism Screening Test (SMAST), and Addiction Severity Index (ASI)). The
"CAGE" test consists of only four questions and can be integrated into a
standard welfare intake process. Experts recommend against universal drug
(urine) testing as not cost beneficial, but other screening techniques may
facilitate early recognition and treatment, and avoid wasting training and
placement resources on individuals who will be rejected by employers who do

Some states screen for mental health problems (e.g., Oregon). Others are
looking at systematic ways to recognize learning disabilities (e.g.,
Washington, Kansas). Some are developing protocols for identifying signs of
domestic violence (e.g., Maryland, Delaware). Kentucky is developing videos
and pamphlets to help clients recognize special needs and seek help. But
programs need to be sensitive to privacy, confidentiality, and protection
issues around revelation of domestic violence, drug use, or other criminal
involvement. Some experts suggest offering only information on symptoms and
referral sources, rather than doing universal screening, in order to allow
recipients to come forward on the own to seek assistance.

Others localities have developed instruments to rate employability, using
descriptors such as education, work history, shelter, income, health
insurance, safety, family functioning and other personal attributes (e.g.,
Asian Neighborhood Design in San Francisco, 415-982-2959; Bucks County
Opportunity Council 215-345-8175). Instruments for precision job matching,
while useful in some circumstances, may be largely wasted on those who will
inevitably cycle back to welfare even as they may improve their job status
over time.

Many states use many different instruments, some allow great variation
across district offices within the same system, some (e.g., Oregon,
Kentucky) rely most on client interaction with well-trained staff rather
than formal diagnostic tools, and some build routine monitoring into their
case management strategy no matter what participation is required or who is
providing services.

Many programs take the position that self sufficiency can be achieved only
one job at a time, as one moves in and out of work, but gains in skills,
confidence and job quality with each move. Hence states will want to build
in capacity to reassess job and personal needs and expect to provide
appropriate supports on a continuing basis. In addition to reassessment
that should inevitably follow returns to welfare, some states are using
routine in-home visits to assess individual and family needs over time.

Staffing. Depending on their program model, states can broaden the function
of the intake worker, add specialized staff, or rely heavily on the skills
of other service providers through co-location or other collaboration on
TANF objectives.

Some states are training intake staff in new screening techniques including
sensitivity to evidence of domestic violence and substance abuse, when and
how to use formal diagnostic tools, such as those to identify learning
disabilities, and when and how to do home visits. Many states began under
the JOBS program to integrate case management with the traditional
functions of the eligibility worker. Case managers may be expected to
perform a broad array of functions, including conflict resolution and
identifying and procuring services such as mental health services,
substance abuse treatment, or transportation. Case managers may do home
visits to all longstayers or noncomplying recipients, and site visits to
service providers, for example to establish appropriateness of child care.
Oregon=92s staff has such broad-based responsibilities. University-based
training programs or schools of social work may be good resources, as Utah
found, for staff training in case management techniques.

Some states have assigned special staff or specialized case managers to
welfare offices to assist in intake and screening for special problems such
as substance abuse (e.g., Utah), or eligibility for SSI. Others (e.g.,
Kentucky) have developed strong partnerships with mental health or other
service delivery agencies to train case managers and supervisors in how to
be sensitive to issues such as substance abuse or domestic violence, and
how to seek help. Some TANF offices are co-housed with specialists from
other service systems (e.g., Oregon).

Staff caseloads may need to be reduced to accommodate new case management
responsibilities. Similarly, states who have relied on labor market
exposure many now need to accelerate their timing and use of diagnostic
tools as their caseloads increasingly distill down to those harder to
place, and staffing choices may have to change accordingly. And as states
turn to strategies for job retention, they may need to enhance staff skills
in post-employment monitoring, mentoring, counseling, and other service
delivery strategies.

Service options. Strategies for the hard-to-place take may three forms.
They may: 1) provide remedial services for minimal reading and math
competencies as well as the so-called soft skills of the work place, or
direct treatment such as for substance abuse of mental health; 2) provide
ancillary supports pre- or post-employment, for tangible needs such as
transportation or child care, or for routine monitoring, counseling, or
crisis intervention designed to increase job retention, or 3) manipulate
the labor market either by special appeal or support for employers or by
identifying market niches, as the original supported work model did, which
can sustain specially designed training or employment programs. Many models
incorporate aspects of all three. Remedial services and mental health or
substance abuse treatment, in particular, may be offered discretely or
integrated contemporaneously with employment or training.

Probably less than 10 percent of jobs can be filled by those with extremely
low skill levels, hence remedial services and alternative workplace models
are especially relevant. TANF allows vocational training up to 12 months in
counted work participation (although only 30 percent of TANF recipients in
counted work participation may be in such training). TANF also allows
vocational training and other educational activities (e.g.,
employment-related or GED) after the mandated 20 hours of work
participation. Mandated work participation for single parent families
increases to 30 hours per week by 2002, but 10 of those hours may still be
spent in education and training directly related to employment. For those
who do find jobs, literacy and other remedial training may be important
ways to help recipients become more valued employees and more economically
secure in the long term. For those who will be unable to find paying jobs,
community service, or providing child care for another recipient engaged in
community service can count toward work participation.

After placement, programs may provide support through an intermediary to
monitor, mentor, or provide crisis intervention or ongoing career
counseling in order to assure that incremental progress is made toward job
retention and improvement. They may also provide case management services
directly to employers, offer employers ongoing monitoring as an inducement
for sensitive hires, or train workplace supervisors to deal with more
challenging employees. Some states are creating specific authorizations,
financial incentives, or training to provide post-placement case management
or other services (e.g., California, Florida, Illinois, Arkansas).

Many initiatives that have successfully placed those with minimal education
and skill levels or other barriers have identified either specific jobs for
which participants can be trained and eventually placed, or products or
services for which the program will remain a principal producer, thus
maintaining relative control over a labor market niche in which their
participants will have continued comparative advantage. For example, IndEx
in Tulsa, Oklahoma began its education and work-based training as sole
producer of a fishing rod for a major national retail chain. Home Care
Associates Training Institute, now in New York, Boston and Philadelphia,
links its training to its for- profit health care cooperatives, with
training and wage and benefit packages structured to give them a continued
competitive edge in an industry marked by mediocre performance and high

Programs experienced with working with the hardest to serve anticipate
frequent job changes and recycling back to welfare. They define work
participation broadly in order to accommodate wide variation in employment
and family needs. They create short-term goals with frequent revisions,
close monitoring, and extremely flexible program regimen that are based on
individual needs rather than preconceived program content or sequence. They
tend to impose the requirements of a conventional work setting gradually,
under close supervision by staff alert to problems as they arise and able
to address them, either directly or by referral. They also offer a rich
array of supportive services=97over a relatively long term=97to deal with the
variety of personal difficulties that clients face.

Given the probable interdependence of personal and family factors for many
of the hard-to-place, it makes sense for TANF administrators to begin to
interact with service deliverers=97both parallel public agencies and other
providers=97best equipped to respond to the array of problems that may
surface. Placing services in the community using new funding possibilities
outlined below may broaden access both to recipients and other family
members and thus have greater impact.

Funding options. Assessments will inform service and funding strategies,
particularly options for mixing funding sources for special services, and
for those activities that count toward work participation and those that do

TANF agencies will want to work closely with substance abuse, mental
health, vocational rehabilitation, and state education agencies, and those
who administer Title XX (Social Service Block Grant) funds, as well as
public and private providers of shelter, crisis intervention, legal and
mentoring services. States may shift up to thirty percent of TANF funds for
programs under the Child Care and Development or Title XX Block Grants
(though Title XX programs can receive only one-third of such funds and only
for families within income limits). While most share goals of moving
dependent clients and families toward self-sufficiency program philosophies
may vary, and administrators will do well to start discussions early so
that mutually beneficial funding and management strategies are well
understood. Kentucky, for example, has funded the adult education agency to
provide training in job and life skills, which would count toward the work
requirement, and is attempting to develop cooperative agreements between
the TANF and vocational rehabilitation agencies.

The new Welfare-to-Work Grants, administered by the U.S. Department of
Labor generally through the state or local Private Industry Council (PIC),
provide $3 billion in FY 98-99 to move the hardest to place, including those
with substance abuse, low reading or math skills, or poor work
histories=97into jobs. The funds can be used for a variety of job related
activities including post-employment, job retention and supportive
services. PICs may find working with TANF agencies especially helpful in
developing mutually beneficial service strategies. Also, twenty-five
percent of the funds are earmarked for competitive grants to PICs,
political subdivisions and private entities including community-based
organizations, which could support a variety of innovative approaches. (See
U.S. Department of Labor Welfare-to-Work webpage http://wtw.doleta.gov).

For substance abusers, some states are using short-term outpatient
treatment to make clients ready for employment, and following up with
longer-term treatment as individuals remain employed. TANF funds may not be
used for medical treatment, but Medicaid and federal substance abuse block
grant funds might help pay for such treatment. Medicaid funds, which also
generate a federal match, can support screening, counseling,
detoxification, day treatment and methadone maintenance. More facilities
are needed that can serve mothers with children so that children are not
placed in foster care when a mother receives treatment.

TANF administrators would do well to coordinate with their local public
housing authorities (PHAs) and community development agencies. New
so-called place-based strategies are often characterized by program
innovations to address the myriad needs of recipients and their families,
and centered in public housing where welfare longstayers may be
concentrated. Also, PHAs may be especially sensitive to the effects of
welfare reform on available rent subsidies: though welfare recipients would
not lose subsidized units due to increased earnings, loss of income due to
decreased earnings or sanctions might severely strain existing subsidies.
Among the programs especially appropriate for the hard-to-place:

PHAs who have received additional units of assisted housing are obligated
under the Family Self-Sufficiency Program to offer job training and
supportive services to interested families, and to escrow rent increases
due to earned income for use after welfare;

    Community Development Block Grants (CDBGs) funds may be made available
to PHAs and other nonprofits (about $50 million in FY97) for supportive
services (including job retention assistance) to help residents of assisted
housing become self-sufficient;

    HUD's Moving-to-Work Demonstration will give 30 PHAs flexibility to mix
operating, modernization and Section 8 funds, and waiver authority for new
program initiatives. The Jobs-Plus Initiative in 7 of the 30 PHAs
(Baltimore, Chattanooga, Cleveland, Dayton, Los Angeles, St. Paul, Seattle)
will develop intensive, employment-focused programs for welfare recipients
in public housing;

    the Economic Development and Supportive Services Grant program ($55
million), HOPE VI ($110 million is available for social services), and
Tenant Opportunity Program ($5 million) include training, credit and
supportive services to residents of public housing;

    the Step-Up program combines registered apprenticeships with supportive

    designated Empowerment Zones received $100 million in Social Services
Block Grants in FY97 and Enterprise Communities $3 million each in combined
strategies for the most distressed areas.

    In addition, HUD estimates that its housing and community development
programs generate 40,000 jobs directly, and recipients of most HUD funds
are mandated to hire low income residents from within the area. (Contact
state HUD offices for assistance).

TANF or state maintenance of effort dollars can also be applied to
alternative activities that do not count as work participation. Thus
substance abuse treatment, counseling, and other alternative services could
be paid for out of state or TANF funds. States could use TANF funds for
case management services on the job in order to provide mentoring support
or other retention services that would not accrue to the individual and
therefore not count against the time limit. Also TANF funds can be used to
provide office space for staff of other service systems, which in turn
might fund the actual services out of their own budgets.

Some families with long-term health problems or other disabilities might
overcome their need for TANF cash assistance if better served by other
systems. States have attempted in the past to identify children in AFDC
families who could be diverted to SSI. Clients or family members who have
persistent or chronic physical, emotional or developmental problems that
fall short of the SSI disability criteria may pose a greater concern within
a time-limited TANF system. States may want to hone their family case
management skills to identify services for family members with disabilities
or mental health needs in order to increase the employment prospects of the
household head who otherwise is TANF dependent.

Diversion. States may find that diversion policies using TANF funds for
targetted short-term assistance to families identified at intake with
immediate crises, such as car repair, threatened eviction, of power
shut-offs, and avoiding time-limited TANF cash assistance=97can free up TANF
case managers to spend more time and resources on those with greater needs
who remain on cash assistance. Utah=92s Single Parent Employment
Demonstration relied heavily on this strategy, offering up to three times
the amount of the monthly grant to families who might benefit from
short-term assistance rather than AFDC.

[SEE ALSO PART II, which begins with "Innovative Practices"]