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Education Funding

How a Prolonged Shutdown Could Threaten Child-Care Aid for the Needy

By Alyson Klein — January 15, 2019 2 min read
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The partial federal government shutdown has now stretched into its 24th day, and is the longest in history. And if negotiations between President Donald Trump and Congress over a potential border wall continue to falter, states could find themselves in a tight spot when it comes to funding one of the most important programs for poor children—Temporary Assistance for Needy Families, or TANF—as well as other federal child-care benefits.

TANF dollars, about a $16.5 billion block grant, can be used for direct cash payment to families, or to cover the cost of other services such as child care or job training. The program, which was serving about 3.4 million recipients in 2017, is housed in the U.S. Department of Health and Human Services, which was fully funded before the shutdown. (So was the U.S. Department of Education.)

The problem? The authorization—meaning the legal language that allows funds to go to TANF—expired back in December, along with the broader funding bill that Trump and Congress are now clashing over.

There’s no immediate worry for families dependent on TANF, in part because states have to kick in some of their own money for the program. They can keep providing services and benefits using state funds, or by allocating unused federal funds from previous years. But that cushion could run out in a protracted shutdown, experts say.

How long would it take before state resources are stretched thin? It’s hard to say right now, said John Hicks, the executive director of the National Association of State Budget Officers.

“We haven’t seen a state yet jump out there and say we’re within a couple weeks of having to make a decision, do we cut benefits or put up our own money,” he said. If that did happen, it would be unprecedented, he added. “States have never had to make that call. ... That would be a first-time situation.”

The House of Representatives voted Monday to extend TANF through June 30. But it’s hard to say whether the Senate will take up the legislation, or whether Trump will sign it, given that it’s wrapped up in the shutdown drama.

A program in a somewhat similar boat: the Child Care and Development Block Grant which helps about 1.4 million low-income families cover the cost of child care. That program receives roughly $8 billon in federal funds, plus additional state funding. More than half the federal money has already been approved. But the other portion, like TANF, requires an authorization from Congress, and that’s also tied up in the current shutdown debate, said Elizabeth Lower-Basch, the director of income and work supports at the Center for Law and Social Policy, a research and advocacy organization in Washington

Again, it’s not clear how long states would be able to continue to fund the program if the shutdown drags on for months, as President Donald Trump has suggested it might. Some states may have to take steps like declining to enroll new participants in the program in a protracted shutdown, Lower-Basch said.

“Right now, states have cushioned recipients from the negative consequences, and I’m really grateful to them for doing that. I just don’t think anyone knows how long they’ll be able to do this,” Lower-Basch said.

Image: Getty Images

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