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Arizona Experience Shows Risks of Further Expanding State Role in Helping Poor

Update, March 11:  We’ve made corrections to this post.

To save $9 million a year beginning in July 2016, Arizona policymakers have cut families’ time limit for cash assistance from Temporary Assistance for Needy Families (TANF) to 12 months in a lifetime, the shortest in the country.  Shortening time limits hurts the very families that need this assistance the most, research shows — those with limited work experience, low levels of education, and other barriers to employment.

The move also exemplifies the risk of further expanding states’ already considerable responsibility for assisting the poor, such as by block-granting programs like Medicaid and SNAP (food stamps) or allowing states to experiment with alternative strategies for providing assistance to the poor, as House Ways and Means Committee Chairman Paul Ryan proposed in his Expanding Opportunity in America plan last summer.

The cut, part of a budget deal that lawmakers passed last weekend and Governor Doug Ducey supports, continues Arizona’s pattern of plugging budget holes with funds previously used to support the poorest families.  In 2009, Arizona cut the monthly TANF benefit for a family of three from $347 to $278 and in 2010 it shortened the time limit from 60 to 36 months.  The next year, it shortened the time limit to 24 months.  The state also applied these time-limit changes to grandparents raising their grandchildren — the only state that has done so.

These changes have led to a dramatic decline in the number of families with cash assistance, from 33,000 in 2010 to just 12,000 families (including 20,000 children) in January 2015.

These cuts have occurred even as the number of poor Arizona families has risen, making Arizona’s cash safety net one of the country’s weakest.  For every 100 Arizona families in poverty, just nine receive cash benefits from TANF — down from 55 families before the 1996 welfare law, which gave states more flexibility for how to use funds previously used primarily to provide cash assistance to families.  (See chart.)