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Life After Welfare

Life After Welfare
Reform and the Persistence of Poverty

A comprehensive, gripping study of how 179 families have managed in post–welfare reform Texas, and of the themes that define life after welfare.

December 2007
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191 pages | 6 x 9 | 1 map, 9 figures, 22 tables |

In the decade since President Clinton signed the Personal Responsibility and Work Opportunity Reconciliation Act of 1996 into law—amidst promises that it would "end welfare as we know it"—have the reforms ending entitlements and moving toward time limits and work requirements lifted Texas families once living on welfare out of poverty, or merely stricken their names from the administrative rolls?

Under welfare reform, Texas has continued with low monthly payments and demanding eligibility criteria. Many families who could receive welfare in other states do not qualify in Texas, and virtually any part-time job makes a family ineligible. In Texas, most families who leave welfare remain in or near poverty, and many are likely to return to the welfare rolls in the future.

This compelling work, which follows 179 families after leaving welfare, is set against a backdrop of multiple types of data and econometric modeling. The authors' multi-method approach draws on administrative data from nine programs serving low-income families and a statewide survey of families who have left welfare. Survey data on health problems, transportation needs, and child-care issues shed light on the patterns of employment and welfare use seen in the administrative data.In their lives after welfare, the families chronicled here experience poverty even when employed; a multiplicity of barriers to employment that work to exacerbate one another; and a failing safety net of basic human services as they attempt to sustain low-wage employment.


A Choice Outstanding Academic Book

  • Preface
  • Acknowledgments
  • Chapter 1. Families in a Changing Welfare Context
  • Chapter 2. The Context for Texas Poverty and Welfare
  • Chapter 3. The Weak (and Tangled) Safety Net
  • Chapter 4. Making a Living After Welfare
  • Chapter 5. Coping with Barriers to Self-Sufficiency
  • Chapter 6. Staying Employed and Off Welfare
  • Chapter 7. Low-Income Families and TANF Policies
  • Appendix A: Research Methods
  • Appendix B: Regression Tables
  • Notes
  • Bibliography
  • Index

Laura Lein is Professor of Social Work and Anthropology at the University of Texas at Austin.

Deanna T. Schexnayder is Associate Director and a Research Scientist at the Ray Marshall Center for the Study of Human Resources, a unit of the Lyndon B. Johnson School of Public Affairs at the University of Texas at Austin.


In 1996, then president Bill Clinton signed a law intended to "end welfare as we know it." President George W. Bush subsequently worked toward a reauthorization of that same bill with increasingly stringent requirements for welfare recipients; the revised bill became law in January 2006. This book examines the ways in which this new approach to welfare has played out in the lives of impoverished families in Texas who draw on welfare support. In particular, it answers the question, How are these families doing when they leave welfare?

Since the mid-1990s, many states have experimented with various types of welfare reform, and it is a well-known and highly publicized fact that the welfare rolls have declined as a result. Along with declines in the welfare rolls, the years after welfare reform saw a decline in the use of Medicaid, the public health insurance program for low-income families and their children, accompanied by an initial increase in the number of those without health insurance. Roughly half of those who left welfare were employed; of the others, some married, some became eligible for Supplemental Security Insurance or other disability support, and some we know very little about. If the goal of welfare reform was to reduce the welfare rolls, it was undeniably successful, at least in the short run. However, if the goal of welfare reform was to reduce poverty and increase the well-being and stability of families previously on welfare, the results are far more complicated and disturbing. In this book we explore the experiences of groups of Texas families who left welfare after in the early days after the implementation of welfare reform.

The results of welfare reform in Texas are of interest to many in Texas, but they should also be of compelling interest to other states. At this time, policy-makers are arguing the benefits of increasing severity in the terms of welfare reform. The recently passed federal reauthorization bill includes stricter work requirements and effectively no new funds for child care. Texas, with its early experiments with welfare reform and a relatively limited welfare program to begin with, is an important arena in which to study the aftermath of welfare reform. In many ways, Texas experimented relatively early with restrictions and more limited benefits for welfare recipients. Through the experiences of Texas welfare leavers, we can examine the potential outcomes of similar policy initiatives in other states as budgetary constraints begin to affect welfare policies.

In the years following the welfare reform initiatives, many states have conducted studies to determine how the new policies affect the families they serve. In particular, states need to learn if former welfare recipients are employed or receiving other types of economic supports, how many have returned to welfare, and reasons for families' success or failure. The U.S. Department of Health and Human Services (DHHS) has supported these efforts through a number of grants to states to conduct research on Temporary Assistance to Needy Families (TANF) leavers. A synthesis of the findings from the first of these studies indicates that:

  • Three out of five families leaving welfare are employed at any given point after exiting welfare. Although three-quarters of leavers have worked within a year of leaving welfare, their incomes cluster around the poverty level.
  • A significant minority of TANF leavers return to welfare.
  • More than one-third of leavers receive food stamps, and approximately 40 percent have Medicaid coverage in the fourth quarter following exit.
  • Child care findings are inconclusive, with little data available on this topic.
  • Leavers still experience hardship, such as not having enough food, but evidence is mixed as to whether these events are more common before or after exit from TANF. (See Acs and Loprest [2001] for a full report on the findings from the first round of leavers grants.)

Over several years, the Texas Department of Human Services also sponsored research to determine the status of families who left TANF after the implementation of welfare reform. This book combines the findings of this state-funded research with those of federally funded research (through a grant from DHHS) to develop a comprehensive picture of Texas families who have left TANF. Although no one approach can fully assess the effects of welfare reform on poor families, the use of multiple approaches can provide a more complete picture of how low-income families in Texas are faring in the wake of various welfare reform initiatives.

Welfare reform is a rapidly changing arena. Since the data described in this book were collected, a number of changes have occurred in Texas welfare policy. These changes range from the introduction, success, and subsequent reduction of the Child Health Insurance Program to the development of call-in centers for the determination of program eligibility (which is being implemented in 2006). Although some of these changes promise to be of some benefit to impoverished families, there is little evidence that they will substantially change their poverty status.

Sarah: Life After Welfare

We met Sarah, an African-American mother of four—a larger family than most on welfare—one summer Friday at a local restaurant in Houston near where she was living (all names of individuals have been changed). She brought a friend to share the lunch offered by the interviewer. Two years earlier, her husband had left her after ten years and four children together. He lived in another city, and although he had a steady job, his child support payments were infrequent. After the separation, she applied for and received aid from a governmental program, Temporary Assistance for Needy Families (TANF), for more than a year until she found a job. When we met her, she was a certified nurse's assistant, working as a home health aide for persons with mental retardation and trying to get as many hours on her job as she could in order to keep her family together. At the time we met her, she had lost the house where she had lived with her husband and was struggling to find new housing.


I'm not on any kind of assistance. So, right now, I have to volunteer for as many hours as I can get at my job, in order to work, so, when I get through with this interview, I'll leave at 3 p.m., I'll go to work until 11:00 at night, and then I'll go to work again, from midnight to 8:00 in the morning [Saturday]. I get off Saturday morning and go back to work at 8 p.m. and get off at 8 a.m. in the morning. . . . I have to work at least 80 hours or plus, just to get a $500 [two-week] paycheck. I got $600 this payday; I had 114 hours.

Although not receiving TANF, she continued to struggle with the demands of her job, her family responsibilities, and the difficulties she faced in managing her transitional welfare benefits. Sarah's life remained chaotic.

"You Don't Want to Wear Your Welcome Out"

Despite her long work hours, after losing her house Sarah had not been able to save enough money to provide the down payment to lease an apartment large enough for herself and her four children. As a result, she and her children often stayed with friends and relatives. Although she was never without a place to sleep, she and her children moved among households frequently.

Three weeks is a long time [to stay with someone else]. You don't want to wear your welcome out, especially with family. Don't want to wear your welcome out. They all say they'll help, which they do. But you don't wear it out.

In addition to the stability and independence her own apartment would provide, she needed a permanent address in order to register her children for school and to apply for the transitional benefits of Medicaid and subsidized child care, as well as food stamps.

I don't have a place to, to call home, to have any mail sent, or any address, or anything like that. . . . I can't give welfare an address . . . or apply for even just [food] stamps. Because I just can't say where I'm going be living at, you know, and I don't want to put somebody else in inconvenience by you tell them "I'm living here," and then I'm really staying there for just two weeks.

She also worried that her ex-husband was evading his child support payments as a strategy to keep her from having her own apartment, so that he might have a better chance of gaining custody of the children.

Friends who were not able to take in her entire family were often willing to supervise one or more of her children while she worked. However, because her children might be shared out among several households and her work schedule was heavy, there was less time with her children than she would have liked.

So, my typical day is no time with the kids. I don't have that much time with them, because, the thing I always say to them, you know, "Momma's got to go to work."

Within these constraints, Sarah still tried to arrange for real family time with her children. On occasion, Sarah made an hour-and-a-half round-trip to a family friend's home where her children could swim at a nearby pool.

Where the Money Goes

The $1,000-plus that Sarah earned from work and overtime seldom lasted the month. Although she did not pay rent, she contributed to each of the households where she stayed. As Sarah pointed out, she provided small household luxuries as well as contributions for basic necessities. If she bought her own children a treat, she provided that treat for all the children in the household, reiterating her concern not to wear out her welcome.

You don't want to wear your welcome out at one, and then, you don't want the kids to feel so confined that they can't, they, you know, they can't go in the icebox and get what they want, or if I buy the six-pack of juices for them, or the ice cream, blow pops, or whatever, everybody else gets to eat it . . . then when you move in with somebody else, you got them plus their four kids, plus whatever, so when they go in there, that's it, it's gone.

Sarah explained that having her own car was what made it possible for her to work and live in the different areas of the city as she moved from one household to another.

I love my Suburban. Now that truck has been, for a long time, taking care of me. So then, after that, it's the best thing that I do have my "little Suburby." And it takes me out there. The only bad thing is gas. It's five dollars in and five dollars out [to her job]. And you don't play with this. That's a big truck to try to push down the hill, jump-start. And I end up borrowing the money, or like my aunt, she lent me some money.

The truck was expensive in other ways, too. Soon after making a large car insurance payment, Sarah took out a loan to cover a major repair. Several months later, she was still paying off the loan, and that payment was a continuing burden on her budget.

Dealing with regular financial demands was difficult enough, but most months she incurred unexpected, additional expenses as well. During our visit, Sarah worried about how to equip her children for school. Not only did her children need basic school supplies, such as the recently mandated school uniform, she also felt it was important for their safety and personal development that they be involved in after-school activities. She had not been prepared for the related expenses.

So, I assumed I'd get my daughter's uniform for school that she needed, at the school. You tell them to get involved in the school activities. They get involved in the school activities; school activities require that they have a certain uniform or a sweater or a jacket, and you can't get it for them. You know, so that means that they just feel bad, left out, so they don't really even want to participate. So it's hard to tell them to get involved in the school. To keep them off the streets, you try to get them involved in the school activities, and then you can't afford the uniforms for the school activities.

She was also, as we discuss later, paying for medical care and supplies. Sarah simultaneously struggled to meet the emergency and other incidental school expenses while managing her own job responsibilities and balancing her dependence on her family and friends.

The Challenges of Time-Limited Welfare

Sarah was aware that her TANF payments were time-limited (although she had not yet reached that limit), and she knew that the checks stopped once she started earning beyond the maximum allowed wage (as indeed they had some time previously). However, she was surprised by how suddenly her benefits stopped after she started working. At the same time that she lost her TANF benefits she also lost other important benefits, in part because of a missed meeting when she left the welfare office so that she could get to work on time.

They were going to set me up for an appointment, but the caseworker cancelled because she had to go do something. Two weeks later was the only available time that they had, and this is in January, I had to go to work. And my job was like, "No, you can't do it." So I had to wait until February [to interview for TANF]. . . . I did everything they told me to do. I went to all my classes; I turned in every paperwork they asked. . . . I was doing everything they said.

Sarah never successfully reapplied for TANF, but she remained most concerned about the loss of other important benefits.

When Sarah lost her TANF coverage, she also lost her food stamps. Caught up in program regulations she found confusing and impenetrable, she was unable to reinstate these benefits. She was ineligible for emergency food stamps because she was working, and unable to access her regular food stamps once she'd been cancelled for missing an appointment. At the point that she was leaving TANF, she had not yet lost her home (although when we met her she had been without a permanent home for several months) and was still paying rent on the house she had occupied with her husband.

Then, in December, they changed caseworkers, and I didn't get my letter [about food stamps], so, when January the first came around, I didn't get my stamps. On the second, I still didn't get my stamps. I understood that I was off TANF; I understood that part. . . . So when January came, I didn't get stamps, and that's when I went in and asked her, asked them what happened. And they told me I was cancelled. And I said, "Well, I never got a letter. Can I just reapply?" If I reapply, I have to start all over from beginning. And I asked her, "Why would I have to start over from beginning? My paperwork is in the computer from December and you just changed the caseworker. Just pull my Social Security up."

So, in the meantime, I said, "Well, can I have emergency food stamps?" As long as I'm working, I'm not classified as an emergency. "You don't have emergency stamps because you're working." I said, "Well, I don't have any food." "What are you doing with your money?" "I'm paying the rent. You know—your $500 go for the rent, because the rent is high. You got water, you got your electricity, and you got your other basic needs, the gas. One whole check goes to rent. The other whole check goes to your basic needs, so if you buy food, it's like maybe $100. One hundred dollars worth of food is not that much for four kids and an adult.

At the same time that she left TANF and lost her food stamps, Sarah and her children also lost their medical insurance. They were dropped from Medicaid, and the Children's Health Insurance Plan (CHIP) was not yet available in Texas. Not only was Sarah confused and concerned about her family's Medicaid eligibility, she also worried about whether she could afford the medical costs associated with her children's health care needs.

Now mind you, when, when the welfare stopped, not just the stamps, my Medicaid for the kids, everything. . . . I don't care about my Medicaid, but the kids have their little physicals they should have to take and to keep up with their shot records.

That fall, still on TANF, Sarah had planned for her daughter to have recommended dental work, including a root canal. However, the work was delayed, and by the time they arrived at the dentist's office in December, the procedure was denied because their Medicaid was no longer active. Meanwhile, Sarah struggled to obtain treatment for one child's sinus infection and another's asthma.

December's a cold time so that's when her sinuses are really acting up, and my other daughter needed her pump for her sports starting in January and February. We couldn't get any of that. So that's when . . . I thought since TANF ended, then that's why Medicaid ended. And I couldn't get medical benefits from my job yet, because I had to be there six months.

Sarah tried to get the medical care her children needed, and the physicals and well-child checks they should have had. However, without health insurance, the costs were prohibitive.

At the time of our interview, Sarah was suffering from an untreated bladder infection. Like other indigent patients without Medicaid, her only source of treatment was the city emergency room. However, unless you are seriously sick, she pointed out, you wait for hours, and she couldn't afford to miss the hours from work, or the time away from her children should she try to go after work. Furthermore, even medical care at the city hospital required a co-payment that she was not sure she could afford.

Sarah also sought assistance through the Women, Infants and Children (WIC) food program for her three-year-old. Because of her work schedule, she was unable to participate in an educational program about nutrition, one of the requirements for participating in WIC. Therefore, she could not receive WIC benefits.

She also applied to a local utilities assistance program. However, it could provide only limited help. Staff at the utility program interviewed Sarah:

. . . and they say, "Well, we'll pay $50." My electric bill's $150. So, they'll pay $50, okay. They say, well the resources have gone down so they won't be able to put the amount that they pledged, that they told me on the phone. They'll have to contact me with the amount that they can pledge. Well, sooner or later, the amount that they pledge was like $35. That couldn't do anything to my electric bill; they didn't want to hear that.

Sarah wished the people at the agencies she dealt with could recognize the different problems she faced and understand how complicated her life was.

Everybody's situation is different. So, I think they lose that point, right there, that everybody's situation is different. You don't have to be rude to me, you know, I'm being very nice and polite, you don't have to be real mean to me. And the same thing with the system, they treat us like "No, no, no, no." Well, computer, hello, the client didn't make the mistake. We [the agency] made the mistake. So, there should be a way to alter that. You understand what I'm saying, there should be a way to fix it.

In spite of her multiple attempts to get help as summer approached, Sarah still didn't have health insurance. She remained on a waiting list for a subsidized apartment after losing her house nine months earlier, when she could not make her payments. And she depended on friends and relatives for food.

But everything is still chaotic . . . and I'm still waiting on the approval for this house or this apartment, and I don't worry about that much food, because that's the reason why I live from one family to the other.

Even her daily food depended in part on the friends and relatives with whom she stayed.

Focused on her family's daily survival, Sarah had difficulty thinking in terms of long-range plans. Her energies and attention were fully occupied by the pressures and problems associated with keeping her family just hovering on the brink of destitution without plunging into disarray.

The Legacy of Welfare

Because several years have passed since the 1995 Texas welfare reform legislation and the 1996 federal legislation, it is possible to evaluate what these policies have accomplished. Although cash welfare roles have dropped, real changes in the lives of the low-income single mothers and their children most directly affected by the legislative changes are not evident. This book examines the experience of welfare reform in Texas, an experience we believe has not just regional but national ramifications. Despite implementation of a range of policy initiatives designed to change both the behavior of and the outcomes for low-income Texas families, the economic lives of families are much the same as they were at the beginning of welfare reform, with one exception: in the immediate aftermath of welfare reform, these families did not spend as much time on the public dole. However, evidence gathered during the economic downturn of 2000-2002 suggests that even that change may not be permanent (Loprest, 2003).

This book summarizes study findings on families in Texas who left welfare, and their subsequent life experiences. Whether or not the families reverted to welfare, most families whose cash assistance ended undoubtedly continued to live at or below the poverty line. Many of them experienced considerable instability and risk in their daily lives. Sarah's challenges exemplify the three interrelated themes around which this book is organized, themes that define reality for low-income families who left welfare during welfare reform:

    • Families stayed poor. Even when Sarah was working, her household remained in poverty. Families leaving TANF were unlikely to move out of poverty even when they found sustained employment, as Sarah did.
    • Families faced multiple barriers. Sarah continually battled multiple barriers and problems, although she did not identify herself as a person confronting barriers. Families leaving TANF often struggled with one or more barriers to successful employment.
    • Families did not get services. Sarah could not find her way through the bureaucratic maze to obtain the support services for which she was most likely eligible. Even families that appeared eligible for services often failed to successfully negotiate the bureaucratic eligibility process, and many families with demonstrable needs did not qualify for services.

These accounts are presented within a framework of statistics and econometric modeling that draws together administrative data from nine government programs serving low-income families in Texas and a statewide survey of families who left welfare. We identify the policies that worked and were valued by low-income families, as well as those that actually made it harder for poor families, working or unemployed, to improve their everyday circumstances. We also explore the problems and the advantages of welfare reform for a range of families across a variety of settings. The three interrelated themes that characterize the experiences of those who have left welfare since welfare reform emerge vividly in low-income families' stories: their continuing economic insecurity, the numerous problems and barriers they faced in getting assistance and getting on their feet, and their lack of access to a safety net of basic human services.

    Economic Insecurity. In Texas, almost all families who left welfare in the period 1998-2000 remained in or near poverty, and nearly half of them remained likely, even when off welfare, to return to the rolls at some time in the future. They struggled with jobs that were close to minimum wage and offered little prospect for advancement. Their jobs were often part-time, with little continuity. Not only did Texas have one of the lowest monthly cash welfare payments in the nation but the eligibility criteria to qualify for welfare were more stringent than in other states. Many families who would have qualified for welfare assistance elsewhere were not eligible to receive it in Texas. Because of these restrictive eligibility criteria, work of any kind usually resulted in a family earning too much money to qualify for welfare benefits; in fact, working many part-time jobs could result in a family becoming ineligible. Consequently, only very poor families were on TANF in Texas in the first place.

      On welfare or in a low-wage job, families were still poor. Like Sarah, many of the job holders in families that had left welfare struggled with budgets that barely covered their living expenses. These budgets were viable only as long as the families were receiving some public assistance (such as food stamps or Medicaid) and did not incur additional unexpected expenses. Reductions in received assistance or family emergencies could drive these families into genuine material hardship in which housing was unsettled, nonemergency medical conditions went untreated, and a mother wondered how she would feed her family the following day.

        Multiple Problems. About one-third of the families left welfare only to continue to face multiple and compounding barriers to their survival. These families contended with problems that included inadequate medical care, substandard housing, unreliable child care, food insecurity, and a lack of transportation. Together these issues often thwarted the efforts of low-income parents to find and retain jobs and to support their families when they were employed. Furthermore, these problems were interrelated and often exacerbated one another. For example, a family without transportation had limited access to child care; a family in which the children were experiencing health problems in a context of minimal medical care might not be able to afford child care at all. The complexity of these families' daily lives was not reflected in the design of public assistance programs. However, our research illustrates how mothers like Sarah struggled simultaneously with multiple issues of housing loss, irregular child care, and difficulty obtaining medical care, all while working in unstable, low-wage jobs.

          Weak Safety Net. Most families who left welfare did not have consistent access to support services as they tried to sustain low-wage employment. Even when transitional benefits were provided, as their time off welfare lengthened, they faced a shortage of affordable and reliable child care options, as was evident from the extensive waiting lists in many areas for subsidized care. Few families leaving welfare can maintain continuous health insurance for all family members for any length of time. Even access to food stamps, the program with the broadest eligibility criteria, was constrained by demands for recertification appointments for eligibility and, for those with older children, work requirements. Sarah's struggles illustrate some of the difficulties mothers faced after welfare in finding and keeping health insurance and needed housing subsidies, as well as in gaining access to other programs that might lift families out of destitution.

            Families productively utilized a number of programs in their struggle to secure and keep a job, including subsidized child care, medical care, and housing programs. Large federal programs, such as food stamps and Medicaid, as well as state, local, and municipal programs that provided child care subsidies and transportation assistance, were valued as helpful by families. Despite the popularity of these programs with those who received them, some low-income families remained ineligible for services, and still others believed themselves to be ineligible because they misunderstood the complex rules controlling access to support services. Limited program budgets, even for some federal and state programs, and stringent eligibility requirements were the major constraints that families experienced, rather than the nature of the services themselves. Although families in poverty faced many barriers, adequately funded public programs, when available, gave families a better chance of finding jobs and keeping them.

              Organization of the Book

                The first two chapters of this book set the stage for an examination of life after welfare in Texas. Sarah's story is similar to the stories of many families who left TANF and experienced problematic outcomes in terms of work, health insurance, child care, housing, food and nutrition, and transportation. Her story illustrates how a working family can be poor, face multiple barriers to achieving stability, and still receive only limited assistance, even in times of substantial need. In this book we explore the lives of many other families, sometimes struggling, sometimes succeeding, but almost always at risk of hard times should a job, needed services, or social supports fail them.

                  Before exploring the lives of these Texas welfare leavers, we locate these families in the context and history of both national and state welfare policies. In this chapter we briefly review the history of welfare reform, followed by an overview of Texas policies. The research methods used in the data collection and analysis are also discussed.

                    In the second chapter, we examine trends in poverty, employment, health insurance, education, and family composition that marked the social and economic context within which low-income families lived and worked in Texas in the 1999-2001 period of our research. We also explore the ways in which the experiences of poor Texas families differed from those of other poor families in the United States, and how trends in Texas can illuminate trends occurring in the rest of the country. We look specifically at the research sites where we talked in detail with families who had recently left welfare.

                      Chapter 3 describes how the weak safety net in Texas affected low-income families who were struggling to support themselves. Low welfare payments, complex welfare rules, and unhelpful staff members in local welfare offices all contributed to this story. Those families that experienced case management from supportive workers and assistance in applying for programs talked about the importance of such help. In either case, families struggled to make the transition from welfare to work. Even when employed, they often needed additional help to afford and keep health insurance and other benefits that working parents need to balance their work and family responsibilities.

                        Chapter 4 examines the extent to which families who left welfare were employed, the patterns of employment they experienced, the types of jobs they were able to find, the wages they earned, and the impact of all these factors on their families. We explore the nature of these jobs in terms of stability, wages, access to benefits, and flexibility. We found that welfare leavers often held jobs with irregular and variable hours, low wages, frequent layoffs, and minimal benefits. They often engaged in repetitive physical work and stood for long hours at a time. We also consider the importance of other nonwelfare income in their lives, in particular income gained through formal child support payments and the Earned Income Tax Credit.

                          In Chapter 5, we review the barriers that made it difficult for families to leave welfare and obtain steady employment. Although most jobs paid more than Texas welfare, many families leaving welfare had inadequate access to transitional benefits that might have helped them leave TANF; they were struggling with problems in addition to their need for income. These problems included lack of child care, unreliable transportation, and personal health problems. Our respondents also touched on other, less obvious barriers that interfered with their ability to find and keep jobs: their children's and other household members' health problems, food insecurity, and insecure housing. About a third of families we talked to were struggling with several of these problems at the same time.

                            Chapter 6 examines how some families were able to successfully leave welfare yet still remained vulnerable to subsequent poverty and a return to welfare. Here we use quantitative data to examine statistically which programs were most likely to make a difference in families' lives and which issues created the most pronounced barriers. In particular, we examine those supports and experiences most closely associated with employment and those associated with both departures from and returns to TANF.

                              Chapter 7 briefly considers how welfare policies have evolved since we talked to the families in our study, and uses the findings from this study to discuss how successful the welfare reform policies are likely to be. In particular, we emphasize the importance of investing in family well-being and the need to address the many barriers low-income families face as they enter the labor force. We argue that these barriers must be addressed simultaneously and the various programs integrated coherently if families are to achieve economic security.

                                Before journeying into the experience of welfare leavers in Texas, we will set the stage for that trek. Welfare reform itself changed the environment in which impoverished families live. Furthermore, the implementation of welfare reform in Texas was both different from and representative of welfare reform in the rest of the nation.

                                  Welfare Reform: The Nation and Texas

                                    Welfare at the federal level was enacted in 1935 as part of the Social Security Act. Its coverage expanded over the years to include not only impoverished children but an unemployed parent as well (1961). With this and other expansions, the name of the program was changed from Aid to Dependent Children (ADC) to Aid to Families with Dependent Children (AFDC).

                                      Early experiments with welfare were inspired by a series of studies on the dynamics of welfare beginning in the early 1980s (Bane and Ellwood, 1986) that allowed policy-makers to identify factors that appeared to keep people poor. These studies led to a number of welfare-to-work initiatives, including the national Family Support Act of 1988, that tightened work requirements for parents in families receiving welfare. Then, during the 1990s, several states, including Texas, applied for and received waivers from the federal legislation in order to experiment with policies that imposed various restrictions, including time limits, sanctions and penalties, work requirements, and income supplementation.

                                        In 1996, Congress passed the Personal Responsibility and Work Opportunity Reconciliation Act (PRWORA), which established TANF as the replacement for AFDC, the nation's cash assistance program for poor families that had been in place since the mid-1930s. Within general guidelines from the federal government, states were able to develop and adopt their own plans, and they did so, often pursuing somewhat diverse philosophies about what measures were most important. In some areas, strict time limits and requirements were paired with heavy expenditures on education and training. In other states, such as Texas, the emphasis was on reducing the welfare rolls through immediate job placement, if possible, and if not, then through the more punitive measures of denying, discouraging, or financially punishing recipients who did not adhere to all the terms of the state's required personal responsibility agreement.

                                          Unlike the Family Support Act, which was guided by research findings, PRWORA's approach was predicated on theoretical assumptions about the culture of poverty. A leading assumption was that poor people engaged in culturally induced behaviors that led them to be poor and thus had to be changed. The more punitive actions also took a one-size-fits-all approach that assumed that all welfare families needed behavior modification. Such an approach left little room to assist families in overcoming the range of barriers they faced. In fact, many of the ideas that motivated the most recent wave of welfare reform were not empirically tested before being implemented in many states across the country.

                                            One motivation for writing this book was to inform future welfare policy planning through a clearer understanding of what happens to families following policy changes. Changes to the cash assistance program were occurring throughout the period of our study and have continued to the present day. During the course of our study, poor families in Texas were served through the program established by a Texas AFDC waiver (Achieving Change for Texas) that did not expire until 2002, so there were some differences between the Texas system and the federal law. For instance, Texas limited cash assistance to between one and three years for some adults, in addition to the federal lifetime limit of sixty months. In contrast to the federal law, Texas allowed recipients who reached state time limits to return to welfare after not receiving cash assistance for a five-year period. Furthermore, dependent children could continue receiving benefits until a parent reached the federal limits even if the parent no longer received TANF.

                                              Between 1996 and the time of our family interviews and survey in 1999-2001, Texas put into place several other policies. In November and December 1997, the Texas Department of Human Services (DHS) and the Texas Workforce Commission (TWC) instituted Texas Works and a Work First program called Choices, both designed to emphasize to welfare applicants the expectation that they would move on to employment as soon as possible. Texas Works also provided resources designed to divert (or redirect) applicants from welfare into employment even before they had completed a welfare application.

                                                In 1999, the state legislature expanded the Earned Income Disregard: TANF recipients could now disregard 90 percent of up to $1,400 of monthly earnings for four months to maintain continued eligibility for TANF. This was a considerable increase over the previous law's allowance of one-third of their income, but TANF recipients still had incomes below poverty guidelines. Over the period of our interviews, Texas also changed the workforce activity exemption guidelines for parents of very young children, from exempting parents of children less than four years old in 1997 to exempting only parents of children less than two years old in 2000.

                                                  As this history indicates, Texas welfare reform was not a single event but a series of policies that were enacted and implemented over time, and the changes and tweaking continued after the period covered by our research. This piecemeal approach to reform contributed to low-income families' confusion about the rules. Not only families but also agency staff had difficulty keeping up with the changes in legislation. Legislative changes had to be translated into regulations and then into training materials for agency staff, who in turn explained the rules to welfare applicants and recipients.

                                                    The population of welfare recipients we studied was as complex and variable as welfare reform itself. The welfare leavers who are the focus of this book were also a complicated group composed of many subgroups. Welfare leavers were people who left welfare because they found a job, got married, acquired child support, or received some other type of regular financial assistance. They were people who cycled off and on welfare over a period of years and who, although off welfare at the time of the study, were likely to return. They were also people who found the cash assistance so minimal and the difficulties of complying with welfare regulations so cumbersome that they left the welfare rolls without having another reliable source of income. To fully comprehend the aftermath of welfare reform in poor Texas families' lives, we explore the diversity of family experiences that resulted in families' departure from welfare. Welfare regulations were complicated and included a number of waivers or exceptions to the rules, and they were applied to families with a wide range of experiences, problems, and resources. Families varied not only in their ability to take care of themselves but also in their ability to navigate the welfare bureaucracy. These differences among families are an important part of the story of welfare reform and its effects on families.

                                                      Since the expiration of the Texas welfare waiver in 2002, Texas policies toward low-income families on welfare have, with some notable exceptions, become considerably harsher than those in place during the period of our study, 1999-2001. Changes from 2001 on have included full-family sanctions, which remove all family members from welfare if a parent fails to follow increasingly complex rules, and the proposed application of personal responsibility agreement provisions to families receiving Medicaid (a provision since set aside by the courts). Such approaches hold little promise for improving the lives of low-income families. On the contrary, they merely exacerbated families' confusion about how to get assistance during times of greatest crisis and failed to maximize opportunities for families to stabilize themselves. Some changes, such as increased income set-asides (where some income did not count against TANF eligibility), on the other hand, provided valuable and valued support.

                                                        Study Population and Methods

                                                          The TANF leavers we study here included both single-parent and two-parent families whose TANF cash grant ended for all family members and who did not return to TANF for at least two months. We intentionally excluded the few families who had left TANF because they had reached their state time limits. The difficulties and hardships detailed here were experienced by families who left because they became ineligible, found a different source of income, or were unable or unwilling to meet the requirements for TANF participation. TANF leavers were studied during two time periods: April 1998 to June 1999 (Cohort 1) and July to September 2000 (Cohort 2).

                                                            We used three research methods to explore the lives of families leaving TANF. Our demographic and longitudinal analysis used administrative data files, intensive interviews, and econometric regressions to study Cohort 1 TANF leavers. For our analysis of Cohort 2 TANF leavers, we conducted demographic and longitudinal analyses of administrative data, a statewide survey, and econometric regressions. We were able to follow the earlier cohort for a full year after the families' departure from TANF, and the later cohort for three months. We present data from either of the two cohorts, depending on which question we are addressing and whether the two cohorts behaved differently from each other.

                                                              First, the project team worked to link together individual-level administrative data files from programs that serve low-income families. This combined data set allowed us to determine the demographic characteristics marking different groups of welfare users and leavers. The data also allowed us to follow families' participation in TANF and other programs that served low-income families over time. A number of state agencies contributed data, including the Texas Workforce Commission and the Texas DHS, both of which managed important aspects of the welfare program, as well as agencies that collected child support, investigated reports of child abuse or neglect, or placed children in foster care. We refer to this source of information as the administrative data set.

                                                                Second, in what we refer to as the phone-mail survey, we collected information from 723 members of a random sample of 1,596 families who left TANF in September 2000 and remained off TANF for at least two months. We surveyed these families approximately six months after they had left TANF. We were able to confirm that 581 of the original sample of 1,596 families had moved and were no longer available at the address where we tried to contact them. Poor families in Texas experience a great deal of mobility. Rural families often move to follow agricultural work, while urban families move to find less expensive rent and to take advantage of the support of friends and family during periods of homelessness. We mailed a survey to all families, with follow-up telephone calls to reach as many families as possible. A follow-up survey was sent to all deliverable addresses. In the course of all of this activity, we learned not only about family geographic mobility (the primary reason why we failed to reach families) but also about families where the mother was dead, in the hospital, or in jail, or where the mother worked so many hours that she could not be reached in our follow-up effort.

                                                                  Third, we interviewed in person welfare leavers in two large metropolitan areas (Bexar County, which includes San Antonio, and Harris County, which includes Houston), one smaller city area (McLennon County, which includes Waco), and three more rural areas (Jasper County in East Texas, Hale County in the Texas Panhandle, and Cameron and Hidalgo Counties on the Texas-Mexico border). These interviews provided examples of the workings of welfare policies in families' lives. They let us probe into the different types of experiences that arose as families dealt with poverty, employment, welfare, and a range of other life factors in widely varying locales.

                                                                    In this book we use all three kinds of data—the administrative files, the phone-mail survey, and personal interviews—to develop a picture of the workings of welfare reform in Texas during the late 1990s. In particular, we have combined the survey data with the administrative data available on our research families. We were particularly interested in understanding the relative weight of different factors—participation in welfare programs, access to medical insurance, use of subsidized child care, access to other child care, medical conditions, and a range of other family issues—associated with families' successful employment or return to welfare.

                                                                      Most poor people in Texas did not receive cash welfare. Of those who were on welfare, not all left. Thus, the welfare leavers themselves, while a large group, represent a special set of low-income families. Ninety-four percent of Texas families who left TANF during the 1999-2001 period of our study were headed by single women. Nearly 40 percent of these parents were less than twenty-five years old, while another third were between twenty-six and thirty-four years old. Nearly half (45 percent) were Hispanic, with the remainder divided somewhat evenly between black and white caretakers. Most families had two children, with the youngest child less than five years old. Only half of the caretakers had completed high school. To the degree we were able to confirm it, people who responded to the mail survey and people whom we interviewed in the six sites matched the demographic characteristics of the general population of families who left the cash welfare rolls during this period.

                                                                        Earlier research also set the stage for this study. The primary authors, Laura Lein and Deanna Schexnayder, have worked on poverty issues for two decades, and the book is also informed by our other work. Indeed, part of this story is decades old. In Texas, challenges for the working poor have always been present, against the backdrop of somewhat ephemeral services provided by welfare. Poverty is a problem for those employed in low-wage jobs as well as for those dependent on welfare over the long term (Schexnayder et al., 1991). In Texas as elsewhere, low welfare benefit levels in combination with families' desire to work tends to produce family patterns of cycling between welfare and low-wage work (Schexnayder et al., 1998). Low educational levels and other barriers faced by many low-income families often inhibit these families' ability to earn high enough wages in the unskilled labor market to successfully leave poverty, a pattern largely unchanged by recent welfare reforms (Schexnayder, Lein, et al., 2002; Schexnayder, Schroeder, et al., 2002). Families continue to find it difficult to support themselves by working in the jobs currently available to them.

                                                                          Earlier work (Edin and Lein, 1997) also showed the degree to which families elsewhere in the nation shared some of the problems and barriers to stability experienced by impoverished families in Texas, even before welfare reform, as well as more recent work following welfare reform (Loprest, 2002; Moffitt et al., 2002; Zedlewski, 2002). Families could not really make it financially either on welfare or on the wages they received in the jobs that were most likely to follow welfare. They often experienced periods of material hardship with little access to medical insurance, child care, or secure housing.

                                                                            Research in several states has arrived at different conclusions concerning the experiences of welfare leavers. In a recent study, Danziger et al. (2002; see also Cawley and Danziger, 2005), who used Michigan data, demonstrated that welfare leavers do better economically once they have left welfare and moved into wage dependence. These findings were contradicted in part by Moffit and Winder (2005), who used data from three states—Massachusetts, Illinois, and Texas—to show that a large part of the increase in financial well-being comes from contributions from others. Although debate over such issues is ongoing, most researchers agree that welfare leavers are not likely to emerge from poverty in the years immediately after they leave the welfare rolls (Baj et al., 2001; King and Mueser, 2005; King et al., 1991).

                                                                              The experience in Texas is illuminating not just for Texas state policy-makers and citizens but for the entire country. Although the Three-City Study (on which Moffitt drew) and studies pertaining to other states (Isaacs and Lyon, 2000) indicate differences among states in the aftermath of welfare reform, almost all studies agree that welfare leavers generally remain in poverty. In this context, and in a time of government financial retrenchment, Texas represents an interesting and important case. For the population of Texas reflects the diversity of the United States as a whole. Welfare leavers, like welfare recipients, include people of all races and ethnicities. They have various levels of education and deal with different medical conditions and family responsibilities. All of these factors make a difference in why they need welfare in the first place and what their prospects are as they leave welfare.

                                                                                Welfare reform policies are experienced differently by the diverse groups of people living in the wide-ranging parts of Texas' geographic, social, and economic landscape. The size and diversity of Texas allow us to explore the experiences of individuals on welfare in both urban and rural settings, among people who live in one-employer communities and people who experience the opportunities and problems found in large metropolitan settings with many employers. Within this state's expanse, important climatic variations exist, ranging from settings where summer air conditioning is a necessity for many people's continuing good health to areas where winter days without heat can be deadly. People live both in sparsely populated areas with limited access to medical care available and in dense urban centers near world-renowned teaching and research hospitals. All of these differences, and many more, form the diversity of settings within which impoverished families live after welfare.


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