Child Care Subsidies for TANF Families

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Executive Summary

Over recent decades, policymakers have recognized that helping parents on welfare pay for child care is essential to help them move from welfare to work. As such, child care has consistently been an integral part of federal and state welfare reform efforts. It was a major focus of the 1996 welfare reform legislation, the Personal Responsibility and Work Opportunity Reconciliation Act (PRWORA), and of the cash assistance and welfare-to-work program it established—the Temporary Assistance to Needy Families (TANF) program.

Although the connection between child care as a work support and the TANF program's mandate to help welfare recipients obtain employment is conceptually simple, the actual processes and policies used by states and localities to ensure child care assistance is made available to TANF families moving from welfare to work is far more complicated. The complexity arises in part because the child care subsidy and TANF welfare-to-work programs represent two devolved systems that differ in their goals, target populations, administrative structures, and policy frameworks.

Despite the critical role child care subsidies play for welfare-to-work efforts, little research has examined how sites have approached putting these services together for families. The Urban Institute engaged in a multiyear study to help fill the existing information gap about the complex interactions of these two systems on behalf of welfare families. This is the first report of a three-part study that explores different aspects of the intersection of the child care and welfare systems. This report focuses on the systems and policies that affect families' child care subsidies while they are receiving cash assistance through TANF and participating in work activities.¹ Through discussions with child care and TANF workers and administrators in 11 sites in winter 2001/2002,2 this study examined the following four questions:

• What administrative structures have states and localities designed to connect TANF and child care subsidy functions?
• What has to happen—at both the administrative and client levels—for TANF parents to obtain and keep child care assistance—that is, as they move through applying for TANF cash assistance, participating in required work activities, and finding employment?
• What coordination issues have states and localities faced in bringing these two systems together, and what strategies have they developed?
• What are the implications of the answers to these questions for parents as well as for policymakers and administrators interested in improving welfare-to-work and child care services?

Notes from this section of the report

1. The second report in the overall study focuses on some of the particular issues and policy strategies around retaining subsidies when leaving welfare (Adams et al. 2006). The third report of the study examines how these issues play out for parents (those receiving TANF and those who recently left TANF) in selected sites (Snyder et al. 2006).

Note: This report is available in its entirety in the Portable Document Format (PDF).

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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