For La. moms, Paul Ryan’s poverty plan could make a bad situation worse

NEW ORLEANS — Deandrea Frank had long dreamed of becoming a nurse. Even when she was living in a local homeless shelter after Hurricane Katrina, it was a promise that she repeated to herself.

In late September, the single mom of three took her first step toward that goal, enrolling in classes to get her GED. To make time for her studies, Frank found day care at Wilcox’s Academy of Early Learning, near the Gentilly neighborhood, for her 3-year-old, Dequan, while her 7-year-old twins, Kentrelle and Tarrelle, were in school. The 27-year-old began studying hard and even picked out a nursing school for the future.

Then came devastating news: Though she was eligible for government-provided child care assistance, it simply wasn't enough. By the end of October, Frank was told, she could expect a day care bill for $300. Frank only gets $720 a month in welfare assistance and knew she could never keep up the monthly cost of sending her toddler to Wilcox while she went to class. And so, just days after Frank enrolled her son, both she and Dequan were forced to quit school.

“I have to pay rent, light bills,” Frank says, disappointment seeping into her voice. “There are things I need for my household. By the time I look up, I won’t have anything left for my children.”

Her story is not an isolated one. Frank is one of thousands of parents in Louisiana who are struggling to afford day care, even though they’re enrolled in financial-assistance programs designed to help the working poor. Tighter eligibility requirements and budget cuts in the Bayou State have caused the number of families getting child care aid to drop by more than 60 percent over the past five years. 

State officials say it’s because there isn’t enough money in the budget to fund all the child care slots requested. Yet there is a funding stream provided by the federal government that’s specifically meant for parents like Frank: Temporary Assistance for Needy Families, which replaced the New Deal-era Aid to Families With Dependent Children as the nation’s main welfare program in 1996. Under that year’s welfare-reform law, TANF funds can be used to pay for child care to allow welfare recipients to go back to work. First proposed in Newt Gingrich’s Contract With America and eventually signed into law by Bill Clinton, it replaced one-size-fits-all welfare with lump-sum “block grants” that states could then spend however they liked, so long as it was for the purpose of aiding the poor.

That’s not quite how it’s worked out. According to data compiled by the District of Columbia-based Center on Budget and Policy Priorities, states are increasingly using TANF money to plug other budget holes not directly related to easing poverty, leaving poor citizens in the lurch. From 2003 to 2013, though the total amount of TANF dollars handed out by Washington, plus the state spending required by the feds, rose by about $2.6 billion, money spent by states on core poverty-prevention programs — cash aid, work support and child care — actually fell by $2.4 billion as local governments funneled the money into other programs.

Yet congressional Republicans are, if anything, looking to expand the block-grant model to other programs that aid the poor. In July, House Budget Committee chair — and likely 2016 presidential candidate — Paul Ryan proposed sweeping away food stamps, federal housing aid and other programs for the poor, replacing them with “Opportunity Grants” that states could spend as they choose. It would, he wrote in the draft proposal, “create the space and flexibility necessary for local, state and federal government to add value without making judgments about the right level of spending.”

It’s a plan that drew much praise as a rare Republican attempt to tackle poverty, but it has some advocates for the poor worried that history could be about to repeat itself. “It is definitely a cautionary tale,” says CBPP senior fellow Liz Schott. “Block grants really do mean there is much less oversight. The whole line was ‘We need the flexibility to take the money you save on cash assistance and use it for other ways to get families to work.’ But that’s not what’s happening.”

The idea behind TANF block grants sounded innocuous enough to liberals and conservatives alike when Clinton signed it into law in the 1990s. As people moved off of welfare, the idea went, states could use the resulting savings to help the newly employed keep their newfound stability by providing child care and other support.

Initially, as the rising late-’90s economy and tough limits on access to benefits led the welfare caseload to plunge by more than half in just four years, states did pour more money into programs that provide job training and child care. But by the time the post-2001 recession hit, states began to see the TANF money as a solution to a bevy of other budget problems.

The 1996 welfare law authorized states to spend their block-grant money in “any manner reasonably calculated to accomplish TANF purposes” — purposes that, at the behest of congressional Republicans, were expanded to include not just fighting poverty, but also “preventing and reducing out-of-wedlock pregnancies” and “encouraging the formulation and maintenance of two-parent families,” as stated in the bill’s preamble. When the Obama administration required that states submit detailed accounting of their welfare block-grant spending for March through June of 2011, the resulting report revealed funds going to pregnancy prevention and other categories. In March, for instance, Florida spent more than $19 million in TANF money on child-welfare programs (including case management, staff training, and adoption services). That same month, according to the report, Illinois shunted $3.6 million to domestic violence programs and $2.7 million to teen pregnancy prevention, including visits to families where there was risk of child abuse or neglect to “strengthen parent-child relationships.” Massachusetts spent $11 million from TANF on scholarship programs for state residents at local universities.

While poverty watchdogs say there’s nothing wrong with states spending money on programs to keep children safe from abuse — or even college scholarships — this drained the funds available to pay for programs doing what TANF was set up to do: help the poor find and keep jobs, in the hope that they could then make their way out of poverty. When CBPP broke down state-by-state spending on direct poverty-fighting uses of TANF funds — cash welfare grants, work support and child care coverage — Louisiana ranked at the bottom of the list. In 2012, fully $226 million of Louisiana’s total $261 million went to items that did not go to directly fighting poverty. Nearly $70 million went to either pre-K programs or child welfare, which the state otherwise would have had to fund out of its own pocket. Schott is blunt: “This is a state that uses TANF as a cash cow.”

“Since TANF was created in the mid-1990s, poverty in Louisiana has remained stubbornly high, but the safety net that supports poor families has frayed,” says Jan Moller, director of Louisiana Budget Project, which monitors the state’s spending. In particular, child care funding using TANF dollars has all but dried up. According to figures provided by the state’s Department of Children and Family Services, total spending on child care aid plummeted from a high of $11.2 million per month in August 2010 to a little more than $3 million per month today. The number of children benefiting from state aid fell by 25,000, more than 62 percent.

A DCFS representative cites the loss of stimulus funds and surplus TANF funds left over from previous years as the main reasons for the drop in spending. But the loss of those funds was far outstripped by cuts in TANF spending on child care — at the same time that money was increasingly being diverted to other programs.

“We basically have no state general funds going [to child care] below age 4,” says Melanie Bronfin, director of the New Orleans-based Policy Institute for Children. “Our child care assistance program has been cut by 60 percent over five years, and the number of kids has been cut in half, because of these double whammies going on here.”

For Chonique Taylor, the state cuts could soon mean that her child care will evaporate, even though her situation hasn’t changed. A 36-year-old mother of two, Taylor made $25,000 a year working as an insurance verifier at Tulane Hospital. When her second son, Joshua, was born in 2011, she applied for child care assistance. It wasn’t much, she says, about $20 a week off the $150 weekly day care price tag, but “every little bit helped.”

Last year, however, when her son turned 2, the state suddenly cut off her assistance altogether.

“They felt I was making entirely too much money, so they cut me off,” Taylor says. “But I was making the same money. I hadn’t gotten a raise or anything.”

What changed in the interim were the state rules: Whereas at the start of 2011, anyone earning less than 75 percent of the state median income could get child care aid, by August 2012 that limit had been cut to 55 percent of the state median. That helped stretch the state’s dwindling child care budget, but at the cost of making many working-poor families ineligible.

Taylor appealed, only to learn that she was making exactly $3 per pay period over the limit to qualify for reimbursement. The third time she applied, she did qualify. But she still has to pay $124 a week of the $150 day care cost, and constantly worries that she could lose aid. Taylor recently got a raise, and is concerned that she now earns too much to qualify — even though she still has trouble paying bills.

“Your bills outweigh your salary,” Taylor says. “That’s just how it is now.”

Tishawn Green, a single mother of two girls ages 2 and 6, has run afoul of another new state requirement: a 2011 rule raising the number of hours that part-time workers must be either on the job or in a training program from 25 per week to 30. At the time, Green was employed as a part-time teacher at a center called Gilda’s Preschool Academy. She only worked on an as-needed basis, she says, which often left her short of the hours needed to get state child care aid. As a result, this childcare worker was unable to afford childcare herself and would often have to ask family members to watch her toddler while worked shifts or looked for a full-time job.

“I would ask my family, ‘Are you off today? Would you be able to keep an eye on her for a day?’” Green recalls. “Or I’d try to figure, how much do I need to pay people to watch her in order to find a job? That was the most aggravating part."

Green eventually landed a full-time job at the child care center Kids of Excellence, in the St. Roch neighborhood, making $10 an hour. But even though she qualifies for assistance now, her child care bills remain high. Due to copays and low reimbursement rates — Bronfin says 90 percent of Louisiana child care providers charge more than the state will pay — Green gets only $250 a month for assistance. With her child care bills at Kids of Excellence running $150 a week, this means she turns over almost half her paycheck to her employer to watch her 2-year-old daughter.

“I feel like, if you really look at people who are honest and look at their expenses, even though they work at a full-time job and work up to 40 hours a week, it still doesn’t balance out,” says Green, whose family members have chipped in to help pay for child care bills. “Sometimes tuition is just as high as a car [payment] or paying rent. I don’t think it should be as hard as it is, if you’re trying to get help.”

“It seems like it’s become an epidemic in our community,” says Rochelle Wilcox, operator of Wilcox’s Academy of Early Learning. “Over the last five years, we went from over 52 children to five” receiving child care aid, she says.

The switch from 25 to 30 hours a week was especially rough on working parents in New Orleans, says Kids of Excellence owner Kristi Givens, because so many jobs in the tourism industry come with part-time hours. Her center now has only seven children receiving CCAP aid out of 57, she says, down from a high of 42 when they reopened after Hurricane Katrina.

Despite the poor results, there has been little effort to stop states from siphoning off money intended for the poor to fund other programs. (It doesn’t help that the 1996 law specifically prohibits the U.S. Department of Health and Human Services from trying to change how TANF is implemented.) Starting with the current fiscal year, the federal government has begun asking states to report more details on how they spend their TANF dollars, but that will only shed light on the scale of the problem, not eliminate it.

At the same time, Ryan and other congressional Republicans continue to work to employ the block-grant model in other programs. In 2011, they voted to convert Medicaid to a block grant (an attempt that was rejected by the Democratic-controlled Senate). This measure later made it into the campaign platform of 2012 presidential candidate Mitt Romney, after he picked Ryan as his running mate. And Ryan’s plan to turn food stamps and other anti-poverty programs into block grants is only likely to gain attention after the Wisconsin representative takes the reins of the powerful House Ways and Means Committee, as is now expected.

For Frank, meanwhile, the loss of dedicated child care funds under the TANF block grant has already left her in a place she desperately wanted to escape. On a recent weekday afternoon, Cartoon Network blared in the background as Frank folded laundry in her apartment in a 7th Ward housing project. Bored, her son Dequan eventually got tired of television and decided to break apart the laundry basket instead.

Frank, who had to quit her last job because her child care paperwork was taking too long to process, says one reason she chose to go back to school was so that she could help her children with their homework. “I didn’t even go through the seventh grade,” she says. “I can’t help them, because I’m not educated the way I should be.” Now, unable to afford the rising cost of childcare on the state’s meager budget, she’s afraid of repeating the cycle with her 3-year-old.

“I don’t know what to do with him,” Frank says. “We’re sitting around all day, with no place to go. He’s not learning anything. All we do is sit on the floor.”

She finds it particularly sad because Dequan loved preschool, even in the few days he was there.

“At Wilcox Academy, he swung the gate open and ran up the stairs,” she recalls. “I mean, I could not catch him. If that’s not a kid enthusiastic about going to school, I don’t know what is.”