States Should Use TANF to Help Families Meet Their Basic Needs and Thrive, Not to Balance Budgets

In recent months, Kentucky and South Dakota have cut cash benefits under the Temporary Assistance for Needy Families (TANF) program, reducing support that families need for essentials like rent, food, and medicine. They made the cuts to fill holes in their state budgets, but TANF — the nation’s primary cash assistance program for families with children and very low incomes — shouldn’t be used to fill them.

Fiscal pressures on states have been growing in recent years, often because of state-enacted tax cuts. This pressure is predicted to get worse due to the harmful Republican megabill drastically cutting food assistance through SNAP and health coverage through Medicaid. The cost implications of the megabill will intensify over the next two to three years, creating enormous pressure for states to fill in gaps of support that many families with low incomes depend on to meet basic needs.

As states grapple with budget shortfalls and rising costs, they may look to make cuts in important public services and supports, like TANF assistance, to shift money around and close budget holes. Families that see cuts in their TANF assistance could also be harmed by cuts in Medicaid and SNAP (the Supplemental Nutrition Assistance Program).

In many states, a family must have an income far below the poverty line as well as very low assets to be eligible for TANF assistance. Despite TANF’s importance to many of the lowest-income families, states allocate just a little over one-fifth of their TANF funds to basic assistance. Given TANF’s already low benefit levels, South Dakota’s and Kentucky’s cuts will leave families with even less assistance to meet their basic needs.

Citing budget pressures, the South Dakota legislature reduced TANF benefits by $1.5 million (10 percent) in August 2025, resulting in households losing anywhere from $32 to $136 per month depending on the size of the family. South Dakota’s Department of Social Services plans to gradually reduce benefits each year until the state reaches a 35 percent cut. This would result in the average TANF household losing about $180 per month in benefits, with monthly maximum benefit amounts for a single-parent family of three equal to only 21 percent of the federal poverty line. Taking cash assistance away from South Dakota families with extremely low incomes is particularly egregious given the state's TANF program has a reported $23 million in unspent funds from previous years held in reserve.

Kentucky’s cuts are even more severe: a similar 35 percent cut effective at the beginning of November 2025, reducing a single-parent family of three’s maximum benefit amount from $524 to $341 per month. Transportation assistance that helps recipients get to and from work and medical appointments has been cut in half, from $300 to $150 per month.

These cuts undo progress Kentucky made as recently as 2023, when it doubled TANF benefits. That increase made the state one of just 11 whose benefit levels kept up with inflation since TANF’s inception in 1996. Now, its recent reduction has brought its monthly maximum benefit for a single-parent family of three down to just 14.6 percent of the federal poverty line — making it worth even less in real terms than when the program was first established.

Officials in Kentucky have justified the TANF reductions as a necessary step to support the state's overburdened foster care system. However, this approach is counterproductive and directly undermines the first of TANF’s four purposes, to “provide assistance to needy families so that children can be cared for in their home or the home of relatives.”

Cutting a vital income source like TANF makes it harder for families to meet their children’s basic needs — such as food, housing, and medical care — which are often the factors considered in child neglect cases. The immediacy of Kentucky’s cuts is especially troubling given that officials proceeded with their implementation despite many of the same families experiencing delays in receiving SNAP benefits due to the government shutdown and the Trump Administration’s actions.

With fewer resources, families are forced to make impossible choices: paying the rent or buying groceries, buying their kids' school supplies, or keeping the lights on. Cuts to already low TANF benefits deepen hardship and undermine parents’ ability to care for their children at home.

A robust body of research compiled by Chapin Hall finds that material hardship increases the risk for child welfare involvement due to neglect and abuse, and when families have access to cash assistance, their risk for child welfare involvement is reduced. Nationally, about 64 percent of child maltreatment cases in 2023 were due to neglect only — which is strongly linked with material hardship. Rather than removing children from their homes, families should be provided with economic supports like TANF to help stabilize their circumstances and support their children’s healthy development.

States are facing budget pressures from a number of factors, including federal action and large tax cuts that have put funding for public services at risk. However, cutting TANF assistance to some of the lowest income families should not be the approach that states take in navigating those budget pressures.

Kimberly Drew is an independent consultant for CBPP on state TANF policy.