Senate Approves Extension of TANF Program

On November 19, the Senate approved a one-year extension of the Temporary Assistance for Needy Families (TANF) program, a federally funded block grant program to provide families in need with a combination of financial assistance and work opportunities. Coined “Welfare to Work,” TANF limits the amount of a time an individual can receive assistance with a goal to move families in poverty to work. To help these families move off welfare and into employment, they receive assistance for job training and job skills, and to reduce barriers to employment they receive assistance with transportation and childcare.

The bill now moves to the House, which is expected to pass the extension when they return from the Thanksgiving recess. The TANF program is currently operating under a two-month extension of the program to prevent its scheduled expiration in September.

The bill does not include an extension the TANF Emergency Contingency Fund (ECF)―passed as part of the American Recovery and Reinvestment Act of 2009―which expired September 30, 2010.  Almost forty states, including South Carolina, used the ECF to support subsidized employment programs, offering vital job opportunities for low-income parents and youth and decreasing the TANF caseload. In partnership with the state workforce agency, the South Carolina Department of Social Services’ (DSS)  developed a subsidized jobs program that helps businesses get back on their feet while helping parents go back to work.  DSS has referred more than 1,000 people to this program, putting them in jobs and keeping them off welfare. The agency also assists parents with transportation, child care, work uniforms and required on-the-job tools, providing what is needed to move families off welfare and back to work. However, with the lack of funding, DSS will be forced to shut down these efforts.

As passed by the Senate, the legislation would limit funding for the regular TANF Contingency Fund and cancel out a provision under the continuing resolution Congress passed this fall that provided $506 million for the Contingency Fund through the end of Fiscal Year (FY) 2011. The measure would extend authorization of TANF supplemental grants to eligible states through June 2011, but would limit funding to an amount equal to $490 million less the amount used to cover Contingency Fund obligations. Thus, marking the first time Congress has not fully funded the supplemental grant program.

What’s more, the bill imposes a 4% penalty for failure to submit two new required reports. Currently states are not required to track some of the data included in the new reports. Therefore, states will be expected to undertake significant additional administrative burdens at a time of limited resources and staff time.

As you may know the Sisters of Charity Foundation of South Carolina has been advocating for TANF reauthorization. Prior to TANF, funds were allocated based on a formula which required states to provide matching dollars to draw down federal funds. Thus, states with a higher tax base could draw down more federal funding. TANF is to help families TANF is to help families move from welfare to work; therefore, TANF funding should be based on need. Next year, our hope is that Congress re-examines the TANF program and alters funding to a distribution formula based on poverty. It would target federal dollars where they are most needed – to states with high poverty. A formula that equalizes the payments to states based on the percentage of each state’s population living in poverty would benefit 33 of the 50 states, including South Carolina. A formula based on poverty best matches the original intent of the TANF legislation, and is the most unbiased way to allocate new federal funds.

The Sisters of Charity Foundation of South Carolina will continue to watch this legislation and work with our Congressional delegation to be a voice for the underserved and those that serve the underserved. It is one way the Foundation can achieve its vision that South Carolina families have the resources to live out of poverty.

Brooke Bailey is the director of communications and public policy for the Sisters of Charity Foundation of South Carolina

Congress Needs to Reauthorize TANF and Change the Distribution Formula; But Right Now Replenish the Contingency Fund

The Sisters of Charity Foundation of South Carolina, along with other Southeastern Council of Foundations members, continue to raise awareness on the impact of Temporary Assistance for Needy Families (TANF) funding in our states and advocate for TANF reauthorization.

TANF funding is critical to all states in the Southeastern Council of Foundations (SECF), and the Sisters of Charity Foundation of South Carolina is advocating for Congress to reauthorize TANF, and once this occurs to change the funding distribution formula to one that is based on a state’s need. If the amount of funding is increased using the consumer-price index, states making up the SECF would receive a total over $1.5 billion, in addition to current funding, if a formula based on poverty is implemented. A formula that equalizes the payments to states based on the percentage of each state’s population living in poverty would benefit 33 of the 50 states.

Understanding TANF reauthorization may likely be pushed back a year, to 2011, the Foundation believes that there is a more immediate and pressing need, that of the TANF Contingency Fund. 

When TANF replaced the old Aid to Families with Dependent Children (AFDC) program in 1996, Congress appropriated $2.5 billion to a TANF Contingency Fund. Congress created this fund to accommodate states’ increased caseload during a major economic downturn. In order to access this fund states had to have had an increase in needy families in the state as measured by families receiving food stamps (more than 10% increase for the same period in the prior year). The state was also required to invest additional state dollars on needy families. With the economic downturn in 2008, many states qualified for the fund and the fund was completely depleted in 2009.

Many states depend on this money to take people out of poverty and into work. According to information on the federal fiscal year that ended in September 2009, Arkansas will lose $36,260,975, Maryland will lose $38,183,005, North Carolina will lose $60,447,900, Tennessee will lose $38,304,759 and South Carolina will lose $40,000,000. (Some states may have drawn down dollars in 2010, but that information is not published yet.)

To get a better idea of how the TANF Contingency Fund affects South Carolina, read Sisters of Charity Foundation of South Carolina President Tom’s Keith guest column, The Real Welfare Crisis, that appeared in last Sunday’s (May 23, 2010) The State newspaper. You can also tune into the following SC ETV radio stations or online at Your Day Thursday, May 27 from noon-1 p.m. to hear an interview with Tom Keith and South Carolina Department of Social Services State Director Dr. Kathleen Hayes on this very issue.

Last year, the American Recovery and Reinvestment Act of 2009 (ARRA) created a new Emergency Fund under the Temporary Assistance for Needy Families (TANF) block grant. Congress provided $5 billion for the Emergency Fund in ARRA. However, this Emergency Fund is set to expire on September 30, 2010.

As you can see the, there is an immediate need for Congress to replenish the original TANF Contingency Fund or extend the TANF Emergency Fund. Since most southern states’ elected leaders do not support stimulus funding, the best approach is to ask Congress to replenish the original TANF Contingency Fund. This funding source was created for use in a down economy, and this is clearly a time when states need access to these funds. As advocates for the underserved in South Carolina, the Sisters of Charity Foundation is working with the South Carolina Department of Social Services, other organizations, foundations and elected officials to figure out how to get this much needed funding to South Carolina and all southern states.

The Sisters of Charity Foundation of South Carolina and other foundations comprising the Southeastern Council of Foundations are all familiar with the poverty that exists in the states they serve. It is a condition we all work hard to change every day. We know the enormous difference this funding can make in our states for families in poverty, and how detrimental it can if we don’t receive it. United, the Southeastern Council of Foundations can act to help our states get an equitable share of any new TANF funding. Working with the state TANF agency, the Governor’s office and our Congressional delegations we can make sure this issue gets the attention it deserves and results in equity for our states.


Brooke Bailey is the director of communications and public policy for the Sisters of Charity Foundation of South Carolina

Foundations Must Strike Balance

Foundations must find a way to create balance during difficult economic times. It is without question that all foundation assets are down significantly since mid 2008. It was an unavoidable consequence of the U.S. economic downturn. Here is the dilemma. Should foundations spend into their corpus to maintain a consistent spending level when they know their assets have dropped by several million dollars? This is where the balance part comes into play.

Foundations have to spend into the corpus at some level but cannot afford to spend too much and, as a result, put the foundation’s long-term viability at risk. If a foundation is going to survive and thrive for decades to come, then it must be realistic and pragmatic about its funding decisions. On the other hand, nonprofit organizations cannot be left “high and dry.” Thus, foundations are finding creative ways to provide some funds─albeit reduced─and also provide other services to enhance the work of nonprofit organizations and their leaders. An example of these supplementary services is the Sisters of Charity Foundation of South Carolina Learning Academy’s leadership tract, offering nonprofit executive directors graduate-level training and credit in effective leadership strategies, and its forthcoming distance learning opportunities throughout the state.

Foundations have to partner too. The Sisters of Charity Foundation collaborates with the South Carolina Department of Social Services, University of South Carolina School of Medicine, Columbia College, Columbia Chamber of Commerce, United Way of the Midlands and the Central Carolina Community Foundation. The two latter partners and the Foundation are working to leverage a Bank of America grant to assist and address issues around the merging of struggling and failing nonprofits.

It is certain that our Foundation’s available grant funds will be less in 2010 than they were in 2009. However, through creativity and balance we plan to accomplish as much or more than ever next year. Through capacity building, listening sessions, knowledge sharing, distance learning opportunities, social media and other communications tools and more workshops for nonprofit staff and volunteers, we will make an impact next year. This is all in addition to the grant funds that we will still distribute. Though, fewer funds will force us to be more focused and have even higher expectations and a higher level of confidence in our potential grantees.

We must continue to be willing to shift out of our own comfort zone and capture opportunities in a new and different way. There is a fine line for foundations between protecting their existence and accomplishing their mission. The Sisters of Charity Foundation of South Carolina and other foundations must be proactive and strike the perfect balance between our missions and long-term survival. We understand the complexities of this situation and that a lot of other people and organizations are effected by our decisions. The Sisters of Charity Foundation will continue to be a foundation of mission and purpose. That is our first and most important priority. Survival is important too, and we are putting the necessary tools in place to insure that a fine balance is reached both for 2010 and long into the future.


Tom Keith is the president of the Sisters of Charity Foundation of South Carolina