A Shrinking Portion of the Safety Net

Number A-36 in Series, "New Federalism: Issues and Options for States"

The nonpartisan Urban Institute publishes studies, reports, and books on timely topics worthy of public consideration. The views expressed are those of the authors and should not be attributed to the Urban Institute, its trustees, or its funders.

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For needy childless adults, the Food Stamp program and General Assistance (GA) are the primary resources for public assistance. Recent changes in federal law limited Food Stamp eligibility for noncitizens and imposed a time limit on Food Stamp eligibility for those able-bodied childless adults without work. Nearly 1.5 million Food Stamp recipients live in such households, and responsible estimates suggest that as many as 800,000 of these people are subject to Food Stamp time limits.¹ For these people, GA is the last strand in the safety net.

However important it may be, this residual program is in decline. Most states have eliminated part or all of their programs; many recipients now receive limited vouchers instead of cash benefits; and cash benefits have not kept up with inflation. Based on surveys of the 50 states and the District of Columbia, this brief describes the current state of GA and trends in GA over the past decade.² Particular attention is paid to the impact of federal reforms on these trends and their consequences for childless adults and other groups for which GA has served as the last resort.

An Overview of General Assistance Programs, 1998

GA programs are financed and administered entirely by the state, county, or locality in which they operate.

They provide income support through cash or in-kind benefits to meet the short-term or ongoing needs of persons ineligible for federal cash assistance, such as Supplemental Security Income (SSI) or Temporary Assistance for Needy Families (TANF). The availability, administration, eligibility rules, and benefit levels of these programs vary considerably across states.

Thirty-five states, including the District of Columbia, have "state" GA programs, broadly defined as GA programs in which the state government has at least some involvement (figure 1). Twenty-four of the 35 states have statewide GA programs with uniform eligibility rules. Nine require all counties to provide GA, although eligibility rules may vary substantially from county to county. The two remaining states with GA programs do not provide assistance statewide but do provide supervision and funding for counties that choose to have a program. In the majority of states with state GA programs, funding is provided by the state, either solely or in combination with county funds. The remaining 16 states—including nearly all of the southern states and Montana, Wyoming, and North Dakota—do not have state programs; they leave the decision to administer and fund GA programs to the counties. In only six of these states has at least one county chosen to provide GA. In general, these county programs provide lower average benefits than state GA programs and are more likely than state programs to provide in-kind assistance rather than cash. The remainder of this brief focuses only on the states with state GA programs.

Who Is Eligible?

Although all GA programs target those not eligible for or receiving SSI or TANF, most serve only selected populations (table 1). Thirteen states provide assistance to able-bodied adults without dependent children (ABAWDs), two of which only provide benefits to those with limited skills or barriers to employment. Thirty-four states provide GA to the disabled, elderly, or other populations with high barriers to employment. Twenty-four states serve some subset of children and families ineligible for TANF, such as children who are living with an unrelated caretaker. Income eligibility standards for GA populations are generally low. A majority of state GA programs limit assistance to those with income less than one-half the poverty level ($335 per month for an individual, $569 for a family of three). As a condition of eligibility, most of the states that provide GA to able-bodied adults also require these individuals to engage in job search activities or to "work off" the benefit amount through public sector workfare.

What Benefits Are Provided?

Although benefit levels vary considerably across states, most are far below the poverty level (table 1). GA benefits are also lower than benefits in comparable federal programs. On average, GA benefits for disabled individuals are less than half of SSI benefits, and GA benefits for families are about 90 percent of state TANF benefits. Benefit levels for ABAWDs are generally similar to GA benefits for disabled individuals, although few states actually provide cash benefits to ABAWDs; most provide in-kind benefits instead of the cash benefits typical of SSI and TANF. In most programs, some or all GA recipients are also eligible for medical assistance, either through a formal GA medical program or Medicaid or by coverage of certain medical expenses.

Changes in General Assistance, 1989-1998

States have reduced the breadth of their GA programs considerably in the past decade. Of the 38 states with GA programs in 1989, 27 have enacted eligibility restrictions, such as terminating eligibility of ABAWDs (table 2). The recent passage of the Personal Responsibility and Work Opportunity Reconciliation Act of 1996 (PRWORA) led to further changes in state GA programs. Most notably, states have restricted programs to immigrants following the federal lead, and some have shifted families with children to their TANF programs.

Able-bodied adults without dependent children, least likely to be eligible for GA, have suffered cutbacks more than others. ABAWDs are the population most often associated with GA. State GA programs traditionally provided the only source of cash support for these individuals. Few states today, however, actually offer assistance to ABAWDs. The availability of GA for ABAWDs has declined dramatically, from 25 states in 1989 to 13 states in 1998 (figure 2).

The termination of GA programs for ABAWDs has been especially dramatic among those programs that provide cash benefits. Of the 25 states that provided GA to ABAWDs in 1989, just over half provided cash benefits. As of 1998, only 4 of the 13 states that provide GA to ABAWDs provide cash benefits.

Several of the largest states dropped coverage of ABAWDs in the past decade. In 1991, 82,000 recipients lost benefits when Michigan terminated its GA program for ABAWDs. In Illinois, about 66,000 recipients lost benefits when the state terminated its program for ABAWDs in 1992, and in Ohio, over 50,000 recipients lost benefits when the GA program for ABAWDs was terminated in 1995.³

Cutbacks in GA for ABAWDs have not been limited, though, to those states that terminated assistance. All of the four remaining states that provide cash benefits to ABAWDs enacted some form of eligibility restriction over the past 10 years, most notably by limiting the allowable duration of assistance. California and New York added time limits, New Jersey repealed one time limit but added another, and Utah shortened the time limit that was already in place.

The cutbacks to assistance for ABAWDs in these four states have been compounded by the deteriorating value of the cash benefits. Only two of these states, New York and Utah, raised cash benefit levels between 1989 and 1998, although neither of these states raised benefits enough to match inflation. However, except for New York, these states mitigated the effect of the declining value of their benefit levels by increasing earnings disregards, allowing recipients to increase earnings from employment without losing benefits.

Only a few of the nine states that continue to provide in-kind benefits to ABAWDs have cut benefits or enacted time limits. However, most of the in-kind programs were already oriented toward providing short-term benefits addressing specific emergency needs.

Overall, PRWORA had a limited effect on GA policies for ABAWDs. PRWORA restrictions on immigrant eligibility for federal assistance did, however, precipitate similar restrictions among nearly half of the states providing GA to ABAWDs. In addition, work-oriented welfare reforms have led to an increased emphasis on moving GA recipients into the labor force in some states, especially where TANF and GA are closely integrated.

GA programs for disabled, elderly, and unemployable individuals suffered moderate cutbacks. With the exception of the District of Columbia, all of the 35 state GA programs provide GA to at least a portion of the low-income disabled, elderly, or unemployable population. Although many of these states differ with respect to the populations served, all provide GA to disabled persons awaiting SSI determination.⁴ Other populations served include those with temporary disabilities, caretakers of disabled persons, and those in substance abuse treatment programs.

States have cut back GA for disabled, elderly, and unemployable individuals in recent years, especially for those with a temporary disability. Four states terminated their GA programs for disabled individuals during the '90s. Seven states restricted the definition of disability, terminating assistance for some individuals with temporary disabilities. In addition, seven states implemented time limits on some or all of those who are eligible due to a disability, although two states, Michigan and Hawaii, later repealed their time limits. One state terminated assistance to nondisabled elderly persons age 55 and over.

Most of the states that provide GA for disabled, elderly, and unemployable individuals provide cash benefits instead of in-kind payments. As of 1998, 26 of the 34 states with GA for disabled, elderly, and unemployable individuals provide cash benefits, two of which provide lower in-kind benefits to some categories of recipients. However, cash benefit levels for GA for disabled, elderly, and unemployable individuals are low relative to federal programs and have fallen in real terms over the past 10 years. Benefits for the disabled lost a third of their real value between 1989 and 1998 (figure 3).

PRWORA's impact on GA policies for disabled, elderly, and unemployable individuals was generally limited to new restrictions on immigrants. Since states often provide GA to disabled individuals awaiting SSI determination, some states restructured their immigrant eligibility requirements to mirror the new SSI immigrant eligibility restrictions created under PRWORA.⁵ Eighteen states that provide GA for unemployable individuals increased immigrant eligibility restrictions following the enactment of PRWORA, although some of these states did not enact restrictions as severe as those in PRWORA. In the states that did not increase immigrant restrictions—and even in some of the states that did—some of the immigrants no longer eligible for SSI may qualify for GA.

GA for children and families held relatively steady. Fewer states made major cutbacks to GA programs for children and families compared to GA for other populations. Idaho, Montana, and Wisconsin made the most severe cutbacks, terminating GA for all children and families between 1989 and 1998. Four additional states enacted restrictions on GA to families, imposing time limits or terminating assistance for some categories of families. The majority of changes to GA for families, though, came in response to new TANF eligibility rules created under PRWORA in 1996.

Prior to federal welfare reform in 1996, GA for children and families usually included assistance to two- parent families who were ineligible for AFDC due to the AFDC unemployment and work history requirements and pregnant women who were ineligible for AFDC until their third trimester. Other eligible groups often included children who were ineligible for AFDC because they were living with an unrelated caretaker.

In the process of replacing AFDC with TANF, PRWORA allowed states to expand TANF eligibility to include all two-parent families and pregnant women. For states that had been providing GA to these populations, this policy change enabled states to shift some of these costs to the federal government. Nine states transferred responsibility for two- parent families and/or pregnant women to their TANF program (table 2). States that did not shift GA recipients who are eligible for TANF to the TANF programs may count the benefit expenditures for these populations toward TANF maintenance-of-effort (MOE) requirements.⁶

As for other populations, GA benefits for children and families have slowly eroded with inflation over the past 10 years. Between 1989 and 1998, the average GA cash benefit maximum for a family of three decreased 35 percent after adjusting for inflation. Benefit levels for the families and pregnant women who were shifted from GA to TANF, though, will most likely rise since TANF benefits are typically higher than state GA benefits for families. However, these families will now be subject to TANF work requirements and time limits.

As with GA for other assistance groups, PRWORA also has had an impact on GA eligibility policies for immigrant families. Eleven of the 24 states that provide assistance to children and families increased eligibility restrictions on immigrants following the passage of PRWORA. Other TANF eligibility restrictions enacted under PRWORA have had less of an impact on GA policies. Few states, for instance, made changes to their GA programs in response to the new TANF time limits. Since most GA programs for families cover only specific categories of families, many families that reach the TANF time limit may not be categorically eligible for GA in most states. In states with broad GA eligibility requirements for families, it is too soon to tell for most of these states if families that lose TANF assistance due to time limits will be eligible for GA.

GA administrative and funding structures remain relatively stable. Despite the extensive changes in GA eligibility policies, administration and funding structures of GA programs have remained generally stable, with a few exceptions. Most notably, Wisconsin terminated its statewide General Relief program in 1996 and replaced it with a county optional General Relief block grant program that precluded Milwaukee from providing cash assistance. In Connecticut, the joint state and locally funded and locally administered GA program was changed to a state-funded, state-administered GA program in 1997.

Conclusion

GA has contracted considerably over the past decade, escalating a trend begun in the 1980s. Over the past 10 years, states have shrunk their GA programs by restricting assistance to some groups, especially ABAWDs, and by holding benefits to pre-1989 levels.

As other analyses of GA suggest, GA programs are particularly sensitive to budgetary pressures, and many of the cutbacks to GA were enacted in the early part of the decade when states' budgets were suffering as a result of economic downturns.⁷ As states have returned to better fiscal health, however, none have made substantial restorations to their GA programs. Although GA programs exist to provide income support to populations ineligible for federal cash assistance, states have limited the capacity of their programs to provide such support.

PRWORA did not change the general direction of GA trends, but it did have some impact on GA policies—many states restricted GA eligibility for some immigrants (following the federal lead), and they shifted some of the GA population to their TANF programs. For GA recipients who were shifted to states' more generous TANF programs, benefits probably increased. However, PRWORA also made cutbacks in Food Stamp assistance. Many ABAWDs, the population subject to the most severe GA cutbacks, now face time-limited access to food stamps.⁸

Little is known about the characteristics and circumstances of GA recipients or, for that matter, the characteristics and circumstances of those denied help when GA is missing. States do not regularly report statistics on GA beneficiaries, and GA receipt is so uncommon that most national surveys are not large enough to capture enough actual and potential participants to yield reliable information on either group. The reasons for the states' retreat from GA—and the lack of expansion given improved fiscal conditions—are also unclear. Assessment of the long-term impact of changes in the nation's safety net requires more information on state programs for those ineligible for federal cash assistance, the actual and potential beneficiaries of such programs, and the effectiveness of various strategies for moving these people into employment and self-support.

Notes

The author thanks Cori Uccello, Alan Weil, Michael Wiseman, and Sheila Zedlewski for their comments on earlier drafts.

1. Cody, Scott, and Laura Castner. 1999. Characteristics of Food Stamp Households, Fiscal Year 1997. Washington, D.C.: Food and Nutrition Service, U.S. Department of Agriculture (USDA).

2. Surveys of GA referred to for this brief include Gallagher, L. Jerome, Cori E. Uccello, Alicia Pierce, and Erin B. Reidy. 1999. State General Assistance Programs, 1998. Washington, D.C.: The Urban Institute; Lewin/ICF and James Bell Associates. 1990. Characteristics of General Assistance Programs, 1989. Washington, D.C.: Office of the Assistant Secretary for Planning and Evaluation, U.S. Department of Health and Human Services; Nichols, Marion, Jon Dunlap, and Scott Barkan. 1992. National General Assistance Survey, 1992. Washington, D.C.: Center on Budget and Policy Priorities and National Conference of State Legislatures; Uccello, Cori E., Heather McCallum, and L. Jerome Gallagher. 1996. State General Assistance Programs, 1996. Washington, D.C.: The Urban Institute.
3. Data from the Urban Institute tabulations of state data; Danziger, Sandra K., and Sherrie A. Kossoudji. 1995. When Welfare Ends: Subsistence Strategies of Former GA Recipients. Ann Arbor: University of Michigan; and Nichols, Marion, and Kathryn Porter. 1995. General Assistance Programs: Gaps in the Safety Net. Washington, D.C.: Center on Budget and Policy Priorities.
4. Once SSI eligibility is established, the federal government reimburses the state for the GA expenditures for the individual who was awaiting SSI determination.
5. SSI limits eligibility to citizens, qualified immigrants residing in the United States as of 8/22/96, qualified immigrants arriving after 8/22/96 who have worked for 40 quarters, and refugees and asylees during their first seven years in the country.
6. Under PRWORA, states may face financial penalties if they fail to meet complex MOE requirements. In general, states are required to spend 75 to 80 percent of their historic state AFDC expenditures for "qualified state expenditures," including assistance for TANF-eligible families who receive GA.
7. See, for instance, Nichols, Marion, and Kathryn Porter. 1995. General Assistance Programs: Gaps in the Safety Net. Washington, D.C.: Center on Budget and Policy Priorities.
8. Under PRWORA, ABAWDs under age 50 are limited to 3 out of 36 months of food stamps unless they are engaged in work or a work program for at least 20 hours per week. States may exempt, with USDA approval, ABAWDs who live in high-unem- ployment areas or areas with an insufficient number of jobs, and 15 percent of ABAWDs who would still lose eligibility after all other exemptions.

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