A new report from a congressional watchdog details shifting priorities in the Temporary Assistance for Needy Families program, including decreased cash aid and oversight challenges.
From 2015 to 2022, states increasingly shifted funds from the TANF program, which provides cash for families in need, toward “non-assistance” services such as work training and education, while spending on direct cash assistance declined significantly, according to the Government Accountability Office report.
According to the report, states collectively spend around $15 billion of their own funds alongside the $16.5 billion in federal TANF funding, but reporting lacks detailed information on how these funds are used.
Expenditures on non-assistance services increased since 2015, totaling $13.8 billion in 2022, while spending on direct cash assistance to low-income families declined totaling $7.9 billion in 2022.
States reported spending 40.8% of all TANF funds on non-assistance expenditures in fiscal year 2015, compared to 44.2% in fiscal year 2022. Over the same period, spending on assistance and other expenditure categories declined.
The report highlights the gaps in state reporting on TANF spending, with seven states missing or providing incomplete narratives for their 2022 expenditures.
The total unspent TANF funding carried over by states as “unspent funds” increased from $4 billion in 2015 to $9 billion in 2022.
TANF funds can also be directed to specific non-assistance programs implemented by state agencies, such as childcare, transportation for unemployed families, and services like employment counseling and case management.
According to the report, Texas has used TANF funds for workforce training. In contrast, New York reportedly uses TANF funding to operate a summer youth employment program, highlighting the flexibility with which states can use funds.
According to the report, most states GAO spoke with, regardless of whether they carried over unspent funds, said they did not intentionally reserve TANF funds for future use.
Other states reported unspent balances due to subgrantees underspending their obligated funds and the state’s overbudgeting for assistance.
The GAO suggests that Congress consider granting HHS authority to collect additional TANF-related information from states to improve oversight and ensure states provide complete data and reports related to TANF spending. This would improve the quality of information collected, in line with legal requirements.
In response to the report, HHS stated it would continue to improve its monitoring and training efforts and review reporting forms.
Billing and other fraud risks were previously reported in September 2024, payments to nonexistent workers and other scams in 2018. As of April 2024, there were 155 unresolved findings across 51 states, with 99 of those being repeat issues.
