States Hold Onto Federal Dollars Meant for Needy Families

Vanessa Mccrickard, a single mother of two from Woodbury, Tennessee, is the sort of person welfare is designed to help.

Mccrickard says she can’t find reliable child care in her town of roughly 3,000, which is about 50 miles from downtown Nashville, so she can’t work full-time. She receives child support from the father of her oldest child, but nothing from the father of her 2-year-old. She struggles to pay her bills.

Mccrickard applied for Tennessee’s version of Temporary Assistance for Needy Families (TANF), the federal block grant program that replaced traditional welfare in the 1990s. But state officials told her that if she got cash assistance, the state would deduct the same amount from her child support payments. And she’d have to work at least 30 hours a week.

She says her inability to get assistance is especially frustrating because Tennessee has the money to help her — $732 million, to be exact. That’s the amount of federal welfare money the state is holding in reserve.

“To know the state has all this money that’s not going to the people who need it — what about the moms that don’t have help?” she said.

Tennessee isn’t alone. Between 2015 and 2018, the 38 states holding back welfare money boosted their TANF reserves by 41%, according to the Congressional Research Service. One reason is the historically low unemployment rate. But tighter state requirements also have reduced caseloads.

Tennessee’s 2019 welfare surplus is the largest in the country, according to a recent report by the Beacon Center of Tennessee, a fiscally conservative think tank. Last year, Tennessee spent only $71 million of the $191 million it got from the federal government.