Box 7, Folder 8, Document 57

Box 7, Folder 8, Document 57

Prepared by Professor Winifred Bell

ANALYSIS OF PUBLIC WELFARE PROVISIONS
of
HR 12080



The public welfare provisions of H.R. 12080 are intended, accord-
ing to the House Ways and Means Committee Report (House Report #544),
to reduce welfare rolls by encouraging self-support and by reducing
the incidence of illegitimacy. The Bill is a marked departure from
the Administration Bill, H.R. 5710, which began a modest move toward
implementing the recommendations of the 1966 Public Welfare Advisory
Council, “Having the Power, We Have the Duty."*

The major provisions of H.R. 12080 can be divided into the following
areas:

WORK PROVISIONS

In order to receive federal matching funds for AFDC, state agencies
(1) must require that out-of-school youth over 16 and all adults in
AFDC families register for employment and accept any bona fide

offer of work that they are able to "engage in," even if wages fall
below legal minimums; (2) must investigate the employability of
every individual in the AFDC caseload at least once yearly; (3) must
provide community work and training programs (Section 409 of the
Social Security Act, as amended in 1962) throughout the state; and
(4) must require that out-of-school youth and adults in AFDC
families participate in such work and training programs when employ-
ment is not available.

Penalties for refusal to work or engage in training programs
without due cause: (1) AFDC payments may be denied or sus-
pended; or (2) payments may continue in behalf of children
only (i.e. no payments to adults) if (a) they are paid to

an "interested party" who will assure that money is spent
only in behalf of children; or (b) they are converted to
vendor rather than cash payments. Some experts interpret
the Bill to mean that "refusal to work" is synonymous with
child neglect, and that juvenile courts might be pressured
to use this as the sole reason for a finding of neglect,
which in turn, would result in the child's removal from
home. This is not what the Bill says, but experience with
public assistance laws and regulations shows that they are
exploited in some jurisdictions to control families through
threat of separation.



* The major recommendations of the Advisory Council Report:

(1) extend aid to all needy persons, irrespective of family
composition, employment, etc. through one program; (2) set a
national standard of assistance, adjusted only to reflect re-
gional variations in consumer price indexes; (3) establish a
legally enforceable right to certain basic social services;
(4) finance the program by establishing a reasonable and equi-
table state share yearly, and meeting all other costs through
federal funds.
(2)

Safeguards: (1) for the first time, HEW has responsibility
for defining when an adult "is available" for employment,
i.e. HEW must set standards (e.g. health, child care arrange-
ments, etc.) for determining who is employable; (2) day care
for children must be assured for employed AFDC mothers or
those in training programs. (Federal standards for day care
are provided). (3) 30 day emergency assistance can be pro-
vided when assistance is denied.

Relevant facts: A number of states require that assistance
be denied or discontinued whenever employment is available,
and some others deny aid to employable people whether or not
work is available in the area. These provisions are particu-
larly geared toward seasonal labor. The practive of encour-
aging AFDC mothers to work is widespread, and aid has always
been denied in some jurisdictions when welfare workers con-
Sider the adult caretaker of children employable. Experience
to date with work and training programs provides evidence
that many older AFDC youth and adults are not readily employ-
able (about 80 percent), and that to make labor force parti-
Clipation feasible, considerable dental, medical and social
services, basic education, and job training are necessary.
Day care is in very short supply in the U. S., and it is un-
likely that such services can be organized sufficiently
promptly to protect children if mothers are quickly forced
into work or training. One important chronic reason for high
relief rolls is the scarcity of unskilled jobs, so it is
possible that H. R. 12080 can only accomplish its self-support
goals if the federal government also embarks on a full employ-
ment policy, a public works program, or their equivalent.
Only 12 states now have statewide community work and training
programs, and there is evidence that many states will have
difficulty organizing effective statewide programs quickly.











ILLEGITIMACY

H. R. 12080 intends to reduce the incidence of illegitimacy by

(1) reducing the coverage of absent parent families by AFDC (see
p-5 for detailed discussion); (2) encouraging the removal of
children from neglectful homes (illegitimacy is cited as parti-
cular evidence of neglect; (3) extending the circumstances in
which foster home care can be reimbursed from federal funds, and
increasing federal matching rates; and (4) requiring states to
provide statewide family planning services to be brought to the
attention of all AFDC mothers or mothers likely to become eligible
for AFDC.

Safeguards: Mothers are not to be forced to accept family
planning.


(3)

Relevant facts: The proportion of illegitimate children
receiving AFDC is estimated at about 20 percent and has
increased in recent years, from 14 percent in 1959. All
states have protective statutes in which neglect is defined
to include promiscuity and other immoral behavior of parents.
Courts have insisted, typically, that a finding of neglect
rests upon tangible evidence of gross neglect, and seldom
view out-of-wedlock births as sufficient alone. Foster home
care is expensive, and at present states pay most of the
cost. They have long urged federal participation in these
costs. At present, only 26 states have AFDC-foster care
programs, covering only 7,900 children. Longitudinal

studies show that when families are broken up by the re-
moval of children or the imprisonment of parents for neglect,
the majority do not reunite, partially because of the scarcity
of social workers to help in the process. The majority of
illegitimate children are supported privately, and there is
no factual evidence that treating AFDC children as a special
group could reduce the overall incidence of illegitimacy; nor
is there any evidence that threatening to deny aid or to
remove children, or carrying out the threat, reduces the
incidence of illegitimacy.

AFDC-UP (UNEMPLOYED PARENTS PROGRAM)



H.R. 12080 establishes a federal definition of "unemployed parent",
which was previously the province of states. It includes only
fathers, requires a significant attachment to the labor force,
imposes a waiting period of 30 days before unemployed fathers
could apply for assistance for their families, and excludes all
families receiving unemployment compensation.

Relevant facts: This definition would cause a cut-back in
the caseload of all 22 state AFDC-UP programs now in exist-
ence. At present AFDC covers only about 1/5 of the families
below the poverty line of $3,400 for an urban family of

four. The 1966 Public Welfare Advisory Council Report
suggested expanding coverage to all needy families, irrespec-
tive of employment. H. R. 5710, the Administration Bill
recommended merely that AFDC-UP be made permanent.

NON-SUPPORT PROVISIONS



H.R. 12080 requires that state agencies organize and implement
programs to establish paternity of illegitimate children and
secure support from their fathers, and implement programs to
secure support from fathers of abandoned children in whose
behalf an AFDC grant is sought or given. To this end, federal
public welfare funds are to be used to match the costs of ne-
cessary law enforcement and court services.
(4)

Relevant facts: States have previously been required to
notify law enforcement officials whenever aid was requested
in behalf of an abandoned child. Previously, public welfare
funds have not been available to match the costs of law
enforcement agencies or courts, nor has HEW felt it proper
for public welfare agencies to take over law enforcement
responsibilities. However, welfare workers have always

been responsible for verifying and investigating the ability
of relatives to support families applying for or receiving
AFDC, and this task commonly preoccupies a large share of
the workers' time. Vigorous law enforcement does increase
Support payments; it also discourages families from applying
for public aid; and it puts an additional emotional strain
on families already severely pressured from many directions.

WORK INCENTIVES

H.R. 12080 requires that all states disregard all earnings of
AFDC youth under 16 years of age, part-time earnings of school
youth between 16 and 21, and the first $30, as well as 1/3 of
the remaining portion of monthly earnings of adults, whenever
agencies are determining the size of the grant for eligible
families.

Relevant facts: Both the ESEA (Elementary and Secondary
Education Act) and the EOA provide that for persons engaged
in projects funded under those Acts, and also receiving
public assistance, the first $85 plus one-half of the excess
over $85 monthly shall be disregarded for purposes of deter-
mining eligibility for public assistance. H.R. 5710 provided
for "disregarding" $50 monthly of the earnings of children and
adults, subject to a family maximum of $150 monthly. Even
with this more generous amount, there is an incentive for
AFDC families to engage in ESEA or EOA projects rather than
to enter the regular labor force.

Incentives of this type have proven effective in enabling and
encouraging employment. The disregarding of earned income
provision in H.R. 12080 is applicable only to persons who
already are receiving assistance. Thus, applicants who went
to work before applying for assistance have all of their
income and resources taken into account, while families who
have a member who goes to work from the assistance rolls

have their earned income disregarded in the stated amounts.
It is, therefore likely, that the provisions could discourage
work among potential applicants for AFDC, thus serving to
increase the caseload in two ways.
(5)

SOCIAL SERVICES

H.R. 12080 transfers child welfare services in behalf of AFDC
families or families likely to need AFDC from Title V to Title

IV of the Social Security Act, and requires that state agencies
establish family planning and day care programs, as well as other
services intended to enhance the capacity for self-support and

to reduce the incidence of illegitimacy. Until July 1, 1969,

the Bill increases federal matching rates for such services from
75 to 85 percent. Services may be organized by public welfare

or purchased from voluntary and other agencies, and still receive
federal matching.

Advantages: While cost accounting problems will be legion,
transferring such services to Title IV (when they are pro-
vided to AFDC families or those likely to need AFDC) greatly
increases federal funds for statewide social services, since
Title IV grants-in-aid are open-ended and have more generous
matching features. However, this change will result in more
services only if states are willing and able to raise their
share of the cost initially, and since H.R. 12080 imposes
other financial burdens on the states, they may not locate
funds for this purpose. Purchase of services has the poten-
tial for bringing a much wider scope of quality services to
very poor families, assuming states can afford to meet the
initial cost.

Dangers: Associating social services and financial aid
increases the likelihood that services will be used to
control families, force them into the labor market, etc.
rather in the wide variety of constructive ways they are
intended for. In August 1967 HEW announced a reorganization
which separated assistance payments from social services in
line with the conviction of many experts that mixing the

two harmed and limited both. The Advisory Council Report
recommended that all people have a legally enforceable right
to receive certain basic social services. The Report was
moot on the guestion of purchase of services. However, the
Council contemplated that services would be organized on a
community-wide basis, rather than for AFDC or other poor
families as might well occur under H.R. 12080.

CEILING ON ABSENT PARENT SEGMENT OF AFDC CASELOAD

H.R. 12080 prohibits the use of federal matching funds in behalf
of absent parent families* in excess of the number in state AFDC
caseloads as of January 1967, except as the increased caseload
reflects the increased general population in states. States
would still be required to assist all eligible families, but when
the number exceeded the ceiling, federal matching would no longer
be available.
(6)

Relevant facts: Every year more children are being raised
by mothers alone, so this segment of child population is
growing more rapidly than the child population, generally,
or the general population. See Mollie Orshansky, SOCIAL
SECURITY BULLETIN, April 1966. Cutting off federal match-
ing shifts the expense of supporting new eligible families
to the states as soon as ceilings are exceeded (which most
are by now). Unless states can promptly appropriate addi-
tional funds, two adaptations are inevitable: states will
reduce their standards of need (the cut-off point that
separates needy from other families) so that present funds
can cover the rising caseload, or accomplish the same result
by decreasing the percentage of the standard actually paid
to families; secondly, they will take steps to restrict
eligibility in order to reduce families of all types in the
caseload, e.g. instead of following former federal leader-
ship by extending AFDC to school youth up to 21 years of
age, they may well reduce age. Since the intent of AFDC is
to support very poor families so that children can remain in
school, and have a reasonable chance of securing the food,
clothes, lodging, and other necessities of life that they
need to grow into productive, effective adults, any shift
in federal financing that limits the program without pro-
viding equivalent alternatives must be viewed in the long-
range context. H.R. 12080 provides that states can shift
some general assistance cases to AFDC, but statistically
this number will be insignificant as compared with the
effect of the ceiling on absent parent families. H.R. 12080
is unlike most SSA amendments in providing no relief to
states in terms of higher federal matching for assistance
payments, and since payments are low ($36.95 per person
monthly), and living costs rise, states must also make
adjustments in this area unless they are to fall even
further behind the inadequate levels of payment now exist-
ing.







While federal matching in H.R. 12080 improves remarkably

in some service areas and includes others for the first time
in the open-ended AFDC reimbursement formulae, as well as
covering additional children from general assistance and
foster home situations, thus freeing some state funds, the
new requirements will force many states to spend money for
purposes they have hitherto neglected. They may be tempted
to lower standards of need or to pay lower percentages of
their standards unless they are among the fortunate few
where decreases in child population can be anticipated.

*An "absent parent family" may be a family in which the father
is deceased or disabled. Such families would not and do not
normally produce additional children eligible for assistance.
In the main, therefore, this provision is directed toward
illigitimate children and the term, in this sense, becomes a
legal euphemism.
(7)

To prevent this possibility, H.R. 12080 would have to
include provisions to prohibit states from lowering
standards of need or the percentages of their standards
actually paid to families, and require that they maintain
at least the present ratio of the standard to some given
cost of living index.



Freezing the absent father caseload will discourage states from
extending age limits in AFDC for school children up to 21 years
of age, providing services to more "potentially dependent" fami-
lies, or otherwise following federal leadership in widening
eligibility. Conversely, it may encourage them to restrict
eligibility.

Over the years federal leadership and the concern of the
U.S. Congress have resulted in extending eligibility for
assistance and services, so that family breakdown, con-
tinued dependence, and other social ills would not be
encouraged by AFDC. Although some states were well in
advance and others followed promptly, many lag in adopting
possible extensions.

Whenever definitions or other provisions cut across the
entire caseload, and a ceiling is placed on the most
populous type of family in the caseload, the ceiling
itself will act as a strong deterrent to extending the
program. Age, exemptions of earned income, services to
"potentially dependent" families all fall into this
category as do other provisions. Each would serve, if
adopted, to increase all types of families in the case-
load. Indeed, so far as exemptions of part of earned
income are concerned, it seemsinherently illogical to add
a requirement that cannothelp but increase the caseload and
to fix a ceiling on that caseload simultaneously. But even
with the optional extensions, presumably Congress felt
these were desirable preventive steps and wished states

to follow its leadership. Since most states will now have
exceeded the January 1967 ceiling, they may shortly be
thinking of restricting, not extending, elibility. If
this happens, the caseload may soon include few older
youth, and alternative national programs will have to be
devised to assist youth in securing the very educational
and employment preparation that H.R. 12080 so emphasizes.

It should be pointed out that there is no magic in recipient
rates as of January 1967. AFDC has always covered only a
fraction of very poor children in the U.S. Nor is there

any magic in the numbers of children in the AFDC caseload

by reason of their dependency or family composition. Some
states made great effort to relieve childhood poverty what-
ever its cause; others did not; some managed to be quite
(8)

selective, preferring certain types of families to others.
A state like Mississippi with its high recipient rates will
suffer less with the "freeze". But children in Georgia,
Arkansas, South Carolina, and Texas, for instance, where
recipient rates are low and the incidence of childhood
poverty high, will suffer remarkably.

On September 30, 1966 only Arkansas among the above states
had extended eligibility to children up to 21 in the event
that they were in certain types of schools. The states on
that date that had no immediate plan or capacity to imple-
ment either the 1964 or 1965 federal age extensions for
school youth included Alaska, Arizona, Connecticut, Dela-
ware, Florida, Georgia, Kansas, Minnesota, Mississippi,
Missouri, Nebraska, Nevada, New Hampshire, Oregon, Puerto
Rico, South Carolina, and Texas. Since such children com-
prise the largest share of AFDC caseloads, the amount of
money involved will be very large.