Welfare Reform: Rural TANF Programs Have Developed Many 	 
Strategies to Address Rural Challenges (10-SEP-04, GAO-04-921).  
                                                                 
About 49 million people, or 17 percent of the country's total	 
population, live in rural communities, and 18 states have at	 
least a third of their population in rural areas. Rural areas	 
often have less favorable employment conditions than urban areas 
and have fewer public transportation options to help people get  
to and from work. Given these conditions and the Temporary	 
Assistance for Needy Families (TANF) program's emphasis on moving
recipients into jobs and on the path toward self-sufficiency,	 
some have questioned how welfare reform is working in rural	 
areas. To inform discussions of these concerns, GAO is reporting 
on (1) the size and distribution of the rural TANF caseload and  
how the caseload's size has changed over time, (2) the challenges
and strengths that rural TANF programs have in implementing	 
welfare reform, (3) the strategies being used to address these	 
challenges, and (4) what the Department of Health and Human	 
Services (HHS) is doing to help rural areas address these	 
challenges. To obtain this information, we used multiple	 
methodologies, including analysis of county-level caseload data, 
as well as site visits, a review of studies on welfare reform in 
rural areas, and numerous interviews with caseworkers, government
officials and other experts.					 
-------------------------Indexing Terms------------------------- 
REPORTNUM:   GAO-04-921 					        
    ACCNO:   A12238						        
  TITLE:     Welfare Reform: Rural TANF Programs Have Developed Many  
Strategies to Address Rural Challenges				 
     DATE:   09/10/2004 
  SUBJECT:   Employment or training programs			 
	     Public assistance programs 			 
	     Rural economic development 			 
	     Welfare benefits					 
	     Welfare recipients 				 
	     Workfare						 
	     Rural areas					 
	     HHS Temporary Assistance for Needy 		 
	     Families Block Grant				 
                                                                 
	     HHS Temporary Assistance for Needy 		 
	     Families Program					 
                                                                 

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GAO-04-921

United States Government Accountability Office

GAO

                       Report to Congressional Requesters

September 2004

WELFARE REFORM

 Rural TANF Programs Have Developed Many Strategies to Address Rural Challenges

GAO-04-921

Highlights of GAO-04-921, a report to congressional requesters

About 49 million people, or 17 percent of the country's total population,
live in rural communities, and 18 states have at least a third of their
population in rural areas. Rural areas often have less favorable
employment conditions than urban areas and have fewer public
transportation options to help people get to and from work. Given these
conditions and the Temporary Assistance for Needy Families (TANF)
program's emphasis on moving recipients into jobs and on the path toward
selfsufficiency, some have questioned how welfare reform is working in
rural areas. To inform discussions of these concerns, GAO is reporting on
(1) the size and distribution of the rural TANF caseload and how the
caseload's size has changed over time, (2) the challenges and strengths
that rural TANF programs have in implementing welfare reform, (3) the
strategies being used to address these challenges, and (4) what the
Department of Health and Human Services (HHS) is doing to help rural areas
address these challenges. To obtain this information, we used multiple
methodologies, including analysis of county-level caseload data, as well
as site visits, a review of studies on welfare reform in rural areas, and
numerous interviews with caseworkers, government officials and other
experts.

www.gao.gov/cgi-bin/getrpt?GAO-04-921.

To view the full product, including the scope and methodology, click on
the link above. For more information, contact Cynthia M. Fagnoni, (202)
512-7215, or [email protected].

September 2004

WELFARE REFORM

Rural TANF Programs Have Developed Many Strategies to Address Rural Challenges

According to our analysis of 48 states, about 293,000 families living in
rural counties received TANF cash assistance during an average month in
2003. Rural TANF families are about 14 percent of all TANF families, but
the rural portion of individual states' TANF caseload ranges from 0.02
percent to 77 percent. Rural TANF families are concentrated in counties
with disadvantaged conditions, including high unemployment and low median
income. Since 1997, when welfare reform was implemented nationally, rural
and urban TANF caseloads have declined by about the same amount- 44
percent-when all reporting states' counties are aggregated.

The rural TANF caseworkers and service providers at sites we visited
reported that transportation difficulties, job shortages, low wages, and
lack of services, especially child care, challenged their efforts to help
clients become employed and move toward self-sufficiency. However, they
also cited strengths, including collaboration and personal attention to
clients.

To address the challenges they face, the rural TANF programs we visited
have employed a variety of strategies including nontraditional methods of
connecting clients with services and cooperative arrangements that
leverage resources. Some of the strategies adopted by rural TANF agencies
take a more targeted approach, working to overcome one particular
challenge or set of challenges that clients face, especially in the areas
of transportation, employment, and child care.

The Department of Health and Human Services' Administration for Children
and Families has undertaken several efforts that could assist TANF
programs and recipients in rural areas. These include rural conferences, a
demonstration project, technical assistance to rural programs, and a rural
task force with representatives from different programs, including TANF.
Plans are under way for an Earned Income Tax Credit (EITC) initiative
targeting rural TANF recipients.

Rural and Urban TANF Caseload Changes between 1997 and 2003 Percent 100

80

60

40

0

Source: GAO analysis of data provided by 37 states on the average number
of families receiving cash assistance under state TANF programs in each of
the states' counties during months of 1997 through 2003.

Contents

  Letter

Results in Brief
Background
The Rural TANF Caseload Is About 14 Percent of the National

Caseload, Is Concentrated in Economically Disadvantaged
Counties, and Has Declined at About the Same Rate as the
Urban Caseload

Rural Areas Present TANF Clients with Shortages in Jobs and
Services but Also Foster Program Collaboration and Personal
Attention to Clients

Rural TANF Programs Transport Services to Clients and Leverage
Resources to Provide Mentoring, Transportation, Job, and Child
Care Assistance

HHS Has Several Initiatives That Could Benefit Rural TANF

Programs
Concluding Observations
Agency Comments and Our Evaluation

                                       1

                                      2 4

                                       6

13

20

34 37 38

Appendix I	Scope and Methodology of TANF Caseload Data Analysis

Appendix II	Comparisons of Demographic and Socioeconomic Characteristics
of Counties with Different TANF Characteristics

Appendix III TANF Caseload Data by State

Appendix IV	Comments from the Department of Health and
Human Services 47

  Appendix V GAO Contacts and Staff Acknowledgments 50

GAO Contacts 50
Staff Acknowledgments 50

                                Bibliography 51

Related GAO Products

  Tables

Table 1: Comparison of Characteristics of Rural Counties with Different
Proportions of Their Population on TANF 42 Table 2: Comparison of
Characteristics of Rural Counties with Different Degrees of TANF Caseload
Change, 1997-2003 43

  Figures

Figure 1: Percentage of TANF Families, in Each State, Living in Rural and
Urban Counties 7 Figure 2: Location of the Quarter of Rural Counties with
the Highest Proportion of Families Receiving TANF 9 Figure 3: Rural and
Urban Caseload Changes between 1997 and

2003 11 Figure 4: Rural and Urban Caseload Changes by State, 1997-2003 12
Figure 5: Customer Service Representative at Work Central's Call

Center in North Carolina Using Geographic Software Program During a Call
to a Customer 22 Figure 6: Mock Hotel Room for Housekeeping Training at
Community College in Mississippi 31

Abbreviations

ABE adult basic education
ACF Administration for Children and Families
EITC Earned Income Tax Credit
ERS Economic Research Service
GED general equivalency diploma
GOLD Golden Opportunities for Lifelong Development
HHS Department of Health and Human Services
MOE maintenance-of-effort
OEI Occupational Enterprises, Inc.
OFA Office of Family Assistance
PREP People Realizing Employment Possibilities
PRWORA Personal Responsibility and Work Opportunity

Reconciliation Act of 1996 TANF Temporary Assistance for Needy Families
WIA Workforce Investment Act

This is a work of the U.S. government and is not subject to copyright
protection in the United States. It may be reproduced and distributed in
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separately.

United States Government Accountability Office Washington, DC 20548

September 10, 2004

The Honorable Charles E. Grassley
Chairman
The Honorable Max Baucus
Ranking Minority Member
Committee on Finance
United States Senate

The Honorable John D. Rockefeller, IV
United States Senate

About 49 million people-17 percent of the country's total population-
live in rural America, and 18 states have at least one-third of their
population in rural areas. In general, rural areas have less favorable
employment conditions-fewer employers, fewer job options, and higher
average unemployment rates-than urban areas. Also, rural areas usually
do not have the type of public transportation often available in urban
areas
to help people get to and from work. Welfare reform, which was
implemented nationally through the Temporary Assistance for Needy
Families (TANF) block grant program, emphasizes the need for welfare
recipients to gain employment and move toward self-sufficiency. Given the
conditions in rural areas that could affect TANF recipients' abilities to
get
a job and go to work, some have questioned how welfare reform is
working in rural areas.

Because of your interest in rural areas, you asked us to study welfare
reform in these areas. This report presents information on (1) the size of
the rural TANF caseload (that is, the number of families receiving monthly
cash assistance), how that caseload is distributed, and how the caseload's
size has changed over time; (2) the challenges and strengths that rural
TANF programs have in implementing welfare reform; (3) the strategies
being used to address these challenges; and (4) what the Department of
Health and Human Services' (HHS) Administration for Children and
Families (ACF) is doing to help rural areas address these challenges.

To learn about the rural TANF caseload, we collected and analyzed
county-level caseload data, which we determined were of an acceptable

reliability to use, from 48 states.1 Appendix I provides additional
information on the scope and methodology of our TANF caseload data
analysis. To learn about the challenges and strengths of rural TANF
programs in implementing welfare reform and about the strategies being
used to address these challenges, we visited TANF caseworkers or service
providers in one or more rural counties in nine states: Arkansas,
Kentucky, Minnesota, Mississippi, New Hampshire, New Mexico, North
Carolina, Virginia, and West Virginia. We selected locations to visit
according to a combination of factors-their implementation of interesting
strategies to address rural challenges for welfare reform, their high
percentage of the population living in rural areas, and geographic
diversity considerations. In three locations, we met with TANF clients to
learn about the challenges they face in rural areas. We augmented our site
visits with a review of studies on welfare reform in rural areas. We did
not conduct site visits in urban areas and, therefore, do not address
urban areas' challenges, strengths, or strategies for implementing welfare
reform. To learn what ACF is doing to help rural areas address challenges
in implementing welfare reform, we interviewed ACF officials and reviewed
documents they provided or that we obtained from their Web sites. We
performed our work from June 2003 through July 2004 in accordance with
generally accepted government auditing standards.

About 293,000 families living in rural counties received cash assistance
under TANF programs during an average month in 2003 in the combined 48
states covered by our analysis. These families constitute about 14 percent
of all TANF families in the 48 states. However, in most of the states,
much more than 14 percent of the state's TANF families live in rural
counties. For example, in South Dakota and Montana, 77 and 69 percent of
the states' TANF families live in rural counties, respectively. TANF
families are not distributed evenly across rural counties but are
concentrated in counties that, on average, have disadvantaged conditions
including high unemployment and a large portion of the population without
a high school diploma. For example, rural counties with a high
concentration of TANF recipients had an average unemployment rate of 7.8
in 2002 compared with 4.8 for counties with comparatively few TANF
recipients. Since 1997, when welfare reform was implemented nationally,

1The District of Columbia is included in this and subsequent counts of
states in this report. Data from Arizona and Delaware are not included
because we did not receive data from these states. Data from Wisconsin are
not included because we did not receive reliable data from Wisconsin.

  Results in Brief

rural and urban TANF caseloads have declined by about the same amount-44
percent-when all reporting states' counties are aggregated. Yet for a
number of individual states, rural and urban caseloads have declined at
different rates, most commonly with rural caseloads declining more than
urban caseloads.

The rural TANF caseworkers and service providers at sites we visited
reported that transportation difficulties, job shortages, low wages, and
lack of services, especially child care, challenged their efforts to help
clients become employed and move toward self-sufficiency, although they
also cited rural TANF program strengths of collaboration and personal
attention to clients. The obstacles we identified during our site visits
were also noted in several welfare reform studies. In some economically
depressed areas, caseworkers believed their clients had a high prevalence
of other problems such as very low education levels, domestic abuse, and
medical conditions that the clients believe make them unable to work. On
the other hand, TANF caseworkers and service providers we spoke with said
their TANF programs have strengths that help them address the challenges
posed in rural areas. First, they said they have used their connections in
the community to develop collaborations with other social service
providers, employers, and community institutions to help clients overcome
problems and find jobs. Some rural TANF caseworkers also told us they were
able to give their clients a lot of personal attention and their knowledge
of the clients helped them address clients' problems.

To address the challenges they face, the rural TANF programs we visited
have employed a variety of strategies including nontraditional methods of
connecting clients with services, cooperative arrangements that leverage
resources, and efforts to increase transportation, employment, and child
care options. To make TANF services more accessible to clients in remote
locations, a number of programs offered mobile or phone-based services,
including a call center, a mobile technology lab, and in-home services.
Further, some rural programs capitalized on community networks, entering
into collaborative arrangements with others in the community to transcend
resource constraints and maximize opportunities for TANF clients to find
work and become self-sufficient. For instance, many of the officials we
interviewed had established close working relationships with other social
service providers in their communities, as well as educators, private
employers, banks, and individual members of the community. The rural TANF
programs we visited confronted transportation barriers by supporting
private vehicle ownership initiatives, sponsoring bus and van services,
and hosting driver's education classes for individuals who have never been
licensed to drive. Some of the strategies being used to help

clients find employment include providing wage subsidies and establishing
workspaces in local manufacturing plants where clients can perform unpaid
work while getting on-the-job training. Other employment strategies
include providing specialized or skill-specific training programs and
conducting comprehensive assessments of all new clients to determine the
steps needed to help them become employed and move toward
self-sufficiency. To increase child care quality and capacity in rural
communities, some of the officials we interviewed had implemented
initiatives to help or motivate existing in-home child care providers to
become licensed or to encourage potential providers to enter the market.

HHS's Administration for Children and Families has planned and undertaken
several initiatives that could assist TANF programs and TANF families in
rural areas. Past efforts include several rural conferences where issues
concerning rural TANF programs were discussed. In addition, the agency
initiated a 7-year demonstration project to evaluate the effectiveness of
rural welfare-to-work strategies, results from which are expected in 2007.
Future efforts that might benefit rural TANF programs include an
initiative designed to increase the number of TANF families residing in
the Mississippi Delta region who claim the Earned Income Tax Credit.2
Moreover, ACF has established a rural task force that is working to
address rural concerns by sharing strategies currently being used by
different programs, including TANF. Among the strategies the task force
has focused on is the use of an e-mail Listserv to facilitate the
distribution of information between ACF and rural service providers. We
provided a draft of this report to HHS for its review. In its response,
HHS said the draft was informative and did not disagree with any of the
findings.

Background 	The Personal Responsibility and Work Opportunity
Reconciliation Act of 1996 (PRWORA) established the Temporary Assistance
for Needy Families program, often referred to as welfare reform because it
fundamentally changed welfare policies. TANF has a goal of promoting work
and helping welfare recipients move toward self-sufficiency. It also
established work requirements for welfare recipients and set a limit of 60
months on the amount of time recipients can receive cash assistance.

2The Earned Income Tax Credit is a refundable federal income tax credit
for low-income working individuals and families. The credit reduces the
amount of federal tax owed and can result in a refund check.

Under TANF, states receive a family assistance block grant from the
federal government that they can use to provide monthly cash assistance
payments to families as well as to finance services for TANF clients or
other low-income people to support their efforts to work. States can also
combine their TANF funds with state funds and those from other federal
programs that finance services such as child care, transportation, and
training. States have flexibility to set their TANF policies, such as to
define the specific activities that count toward the TANF work
requirements and to set the number of months-up to a maximum of 60-for the
cash assistance time limit. Further, states have flexibility in how they
administer TANF; they can set policies at the state level or they can
allow counties to set their own policies. The U.S. Department of Health
and Human Services' Administration for Children and Families administers
the TANF block grant program and monitors states' performance, such as
whether states meet the targets for the percentage of TANF recipients who
meet the work requirements. States' federal TANF funding can be reduced if
they do not meet the federally set targets.

Welfare caseloads declined dramatically in the years following welfare
reform. Researchers have identified various factors that may have
contributed to the caseload decline, such as welfare reform-related policy
changes and economic growth, but there is no consensus about the extent to
which the different factors contributed to the decline. Welfare caseload
changes are only one element to consider in assessing how well welfare
reform is working. Some of the other information that is needed for such
an assessment includes what happened to families who left welfare, whether
former welfare recipients are working and moving toward selfsufficiency,
and whether those who continue to rely on welfare, including hard-to-serve
clients, are getting the services they need to help them leave welfare.

Rural areas of the nation are diverse. The economic conditions, the
characteristics of the population, and the geography differ from one rural
area to another. For example, a rural area can be a retirement location on
a coast, a coal-mining community in the mountains, or an agricultural
community on a plain. A common characteristic of rural areas is relatively
low population density. There are numerous definitions of what is meant by
"rural." The one used in this report was developed by the Office of
Management and Budget and is based on a classification of counties as
either metropolitan or nonmetropolitan. Metropolitan counties include both
central counties with a large urbanized area and outlying counties that
are economically tied to the central counties and display a level of
"metropolitan character" based on population density, urbanization, and

population growth. Counties that do not qualify as metropolitan are
classified as nonmetropolitan. We refer to the metropolitan counties as
"urban" and the nonmetropolitan counties as "rural." Of the 3,141 counties
in the United States, 2,052 are classified as rural.

  The Rural TANF Caseload Is About 14 Percent of the National Caseload, Is
  Concentrated in Economically Disadvantaged Counties, and Has Declined at About
  the Same Rate as the Urban Caseload

Rural TANF families constitute about 14 percent of the total TANF monthly
caseload for the 48 states covered by our study combined. However, when
states are looked at individually, the rural portion of the TANF caseload
ranges from 0.02 percent to 77 percent. Rural TANF families are not
distributed evenly across rural America but are concentrated in counties
that tend to have poor economic conditions. Finally, following national
implementation of welfare reform, rural counties, as a group, had caseload
declines similar to those experienced by urban counties. Yet in some
states, there were substantial differences between rural and urban
counties' caseload changes.

    TANF Families Living in Rural Counties Are About 14 Percent of the National
    Caseload but Form a Larger Percentage in Most Individual States

In 2003, during an average month, about 293,000 families living in rural
counties received cash assistance under TANF programs of the combined 48
states included in our analysis.3 (Three of the 48 states-the District of
Columbia, New Jersey, and Rhode Island-do not have any rural counties and
therefore do not have any TANF families living in rural counties.) The
293,000 families composed about 14 percent of the total number of TANF
families in the 48 states. About 18 percent of families in the general
population live in rural counties in the 48 states; therefore, TANF
families are slightly less concentrated in rural counties in these
combined states than is the general population. This is also indicated by
the fact that 2.4 percent of all rural families received TANF cash
assistance in the 48 states in 2003, compared with 3.1 percent of urban
families.

3Our analysis is based on an average of the monthly count of families who
received cash assistance. Included in the count were families who received
cash assistance paid for with federal TANF funds, as well as families who
received cash assistance paid for with state maintenance-of-effort dollars
required by the TANF block grant. In this report, we refer to all these
families as TANF families.

Looking at states individually, the percentage of TANF families living in
rural counties ranged from 0.02 percent in Massachusetts to 77 percent in
South Dakota. The median for the 48 states was 26.6 percent. The rural
TANF percentage for all 48 states combined-14 percent-is much lower than
the median because several highly populated states with large TANF
populations, most notably California and New York, have a very low
percentage of TANF families living in rural counties. Figure 1 shows, for
each state, the percentage of the state's TANF families who live in rural
counties as well as the percentage who live in urban counties.

Figure 1: Percentage of TANF Families, in Each State, Living in Rural and Urban
                                    Counties

Percent

assachusettsCorniayland

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uttic

FloridaN

adaev

                                    Illinois

icM

nsylvania

                          higanOhioUtahhingtonIndiana

asx

Te

                            onesseeginia tagiaregon

riissouM

                                       a

alabam

                                  Alaska a ka

iiawHa

                                  th Carolina

e

                              Idahoxicoolinaansas

                                  Kpshire a as

aineM

                                       ky

t Virginia W

                                      ing

ontmrVe

                                      ippi

otaak

akontanaM

South D

                                      ota

ALouisian

                                       m

wIo

                                                                   oloradnCTe

Ginneso

YoewN

entucK

                                ebras ArkanseorO

klahoN

myo

                                     ississ

onnecC

VirM

M arewN

South CalifM

                                      th D

ar

                                       am

asW

                                       O

esW

                                       H

nPe

MorN

                                      Nor

wNeM States

Urban caseload

Rural caseload

Source: GAO analysis of data provided by 45 states with rural counties on
the average number of families receiving cash assistance under state TANF
programs during months of 2003.

Note: The District of Columbia, New Jersey, and Rhode Island, which have
no rural counties, are not included in the figure.

When we compared, for each state, the percentage of the TANF families
living in rural counties with the percentage of all families living in
rural counties, we found that for most states, the two were very similar.

However, there were several exceptions. For example, South Dakota has a
higher proportion of rural TANF families than would be expected (77
percent of TANF families live in rural counties, compared with 58 percent
of all families), and Nebraska has a lower proportion than would be
expected (32 percent of TANF families live in rural counties, compared
with 46 percent of all families). See appendix III for more information on
individual states and their rural TANF caseload characteristics.

    Rural TANF Families Are Concentrated in Relatively Few Counties That Tend to
    Have Poor Economic Conditions

The distribution of TANF families is uneven across rural counties, with
some rural counties having very low numbers of TANF families and others
having high numbers relative to all the counties' families. We found that
about 150,000 (51 percent) of the about 293,000 TANF families living in
rural counties live in only a quarter of the rural counties in the 48
states covered by our study. These counties have on average about 4.7
percent of all their families receiving TANF. On the other hand, the
quarter of rural counties with the lowest proportion of TANF families have
a total of only about 14,000 (4.9 percent) TANF families and, on average,
only about 0.6 percent of all their families on TANF.

To determine how counties with different proportions of their families on
TANF compared, we looked at demographic and socioeconomic indicators for
the counties. We grouped rural counties according to the proportion of all
their families on TANF and compared the counties with a high proportion of
families receiving TANF to those with a low proportion. We found
significantly worse socioeconomic conditions in the counties with a high
proportion of all families receiving TANF. For example, counties with a
high proportion of all families receiving TANF had, on average,
significantly higher unemployment, lower median incomes, and
proportionately more people without high school diplomas. See appendix II
for more specific information about how different groups of counties
compared. Figure 2 shows the location of the rural counties with the
highest proportion of families on TANF.

    Nationally, Rural and Urban TANF Caseloads Have Declined Similarly, with
    Some Distinct Exceptions in Some States

Rural and urban counties experienced about the same amount of caseload
decline between 1997 and 2003. Specifically, the number of families, on
average per month, receiving TANF cash assistance in rural counties in the
40 states covered by our analysis4 decreased by 43.9 percent, and urban
counties had a 44.1 percent caseload decrease.5 However, as shown in
figure 3, rural TANF caseloads declined somewhat more than urban caseloads
from 1997 to 2001.

4This analysis includes all states that provided reliable caseload data
for the years 1997 and 2003. See appendix I for a list of those states.

5The number of all families living in rural counties grew at a lower rate
from1990 to 2000 than it did for urban counties. Because of this, without
other offsetting factors, greater TANF caseload decline in rural counties
than in urban counties might have been expected between 1997 and 2003.
Specifically, for the 40 states included in our caseload change analysis,
the percentage increase in all families was 6.0 in rural counties and 9.9
in urban counties from 1990 to 2000, according to decennial census data.

Figure 3: Rural and Urban Caseload Changes between 1997 and 2003

Percent 100

80

60

40

20

0 1997 1998 1999 2000 2001 2002 2003

Calendar year

Urban caseload

Rural caseload

Source: GAO analysis of data provided by 37 states on the average number
of families receiving cash assistance under state TANF programs in each of
the states' counties during months of 1997 through 2003.

Note: The figure is based on data from states that provided reliable
caseload data for all years 1997 through 2003. See appendix I for a list
of these states.

The rural and urban caseloads in many states declined by about the same
percentage over the 1997-2003 period. However, for other states, there
were substantial differences between the percentage of caseload decline in
rural areas and that in urban areas, as shown in figure 4.

Figure 4: Rural and Urban Caseload Changes by State, 1997-2003

States

-100 -80 -60 -40 -20 0 20 40

Percentage change

                             Urban caseload change

                             Rural caseload change

Source: GAO analysis of data provided by 37 states on the average number
of families receiving cash assistance under state TANF programs in each of
the states' rural and urban counties during months of 1997 and 2003.

Note: Although Indiana, Nevada, and Tennessee show caseload increases for
the period 1997-2003, their caseloads decreased in the earlier years and
then began increasing around 2000 or 2001. The District of Columbia, New
Jersey, and Rhode Island, which have no rural counties, are not included
in the figure.

To determine how counties with different levels of caseload size changes
compare, we looked at socioeconomic indicators for the counties. Although
it might be expected that counties with the greatest declines in caseload
would have the most favorable socioeconomic conditions, we did not find
that. We found that counties with the least caseload decreases had, on
average, somewhat more favorable socioeconomic conditions, such as lower
unemployment rates, higher median incomes, and proportionately fewer
people without high school diplomas than counties with the greatest
caseload decreases. Also, counties with the lowest caseload decreases had,
on average, greater increases in unemployment rates and greater population
growth than counties with higher caseload decreases. See appendix II for
more specific information about how counties with different amounts of
caseload change compared.

Several studies and our own site visits indicate that transportation
shortages, fewer jobs, low wages, and a scarcity of ancillary services are
common challenges to welfare reform in rural areas. In some economically
depressed areas, other problems, such as very low education levels, are
additional challenges to welfare reform. On the other hand, rural areas
have strengths in implementing welfare reform in that they foster
collaboration and personal attention to clients.

  Rural Areas Present TANF Clients with Shortages in Jobs and Services but Also
  Foster Program Collaboration and Personal Attention to Clients

    Lack of Transportation Limits Access to Jobs and Services

During our site visits, we found that for some TANF clients,
transportation may be the primary obstacle to becoming or remaining
employed. For example, a caseworker in Logan County, West Virginia, said
that it is not uncommon for clients to say that if they had
transportation, they would not need to be on TANF. She also said she had
several clients for whom she could find jobs immediately if they had
transportation to get there.

Transportation is a fundamental challenge for rural TANF recipients. Many
cannot afford to own and operate a reliable private vehicle, and public
transportation to get to and from training, services, and work is often
not available. A 2001 Urban Institute study looking at welfare reform in

12 rural locations in four states, for example, found that public
transportation was seldom available.6 Caseworkers and service providers in
some counties that we visited said that their counties have very limited
bus service, such as a bus that operates in the main town but not outside
it. Also, these buses generally had limited schedules and were not
available at night. Others said there were no bus systems with set routes
although vans were available to give people rides. For example, in Harnett
County, North Carolina, a caseworker said that the local transportation
agency was very cooperative in arranging pickups for clients but that the
service was expensive. In Duplin County, North Carolina, a caseworker said
that clients could call a van service for rides, but the appointment has
to be set up several days in advance. In Coahoma County, Mississippi, we
heard that the bus route spans a 50-mile radius, and those who choose to
use it may have to allot two or three hours to get to work.

The lack of valid driver's licenses was identified by several caseworkers
and service providers as a problem for many clients. Clients may lack a
driver's license either because they had never had one or because the
license was suspended or revoked because of unpaid fines, no insurance, or
driving under the influence of alcohol. Some caseworkers said that
suspended driver's licenses could be an insurmountable problem because of
the high fees for reinstating them. The Court Clerk in Memphis, Tennessee,
who performed a review of unpaid traffic fines, said that the average
amount owed by people in Memphis with a suspended driver's license was
$1,500 to $2,000.

Few Available Jobs and Rural areas are reported to have average earnings
levels 25 to 30 percent Low Wages Hinder lower than those in urban areas,7
and their unemployment rates are higher, Movement toward Self-on average,
than those of urban areas. Rural areas also have less variety in

the types of jobs available.8 In our site visits, we found a consensus
amongSufficiency rural TANF caseworkers that a shortage of jobs and the
low wages paid by

6Nancy M. Pindus. Implementing Welfare Reform in Rural Communities.
Economic Research Service (Urban Institute) Feb. 2001.

7It might be argued that some of the earnings gap is offset by differences
in the cost of living in urban and rural areas. On average, housing costs
are lower in rural areas than in urban areas. However, little is known
about how other personal costs differ, such as transportation, utility,
grocery, and clothing costs, between rural and urban areas.

8Robert M. Gibbs. "Rural Labor Markets in an Era of Welfare Reform." In
Rural Dimensions of Welfare Reform, edited by Bruce A. Weber, Greg J.
Duncan, and Leslie A. Whitener, 51-75. Kalamazoo, Michigan: W. E. Upjohn
Institute for Employment Research, 2002.

available jobs pose a challenge to their efforts to help clients meet TANF
work participation requirements and find employment that will help them
become self-sufficient. A study of welfare reform in selected persistently
poor rural areas in four states found that in many of the counties
studied, "there were simply very few jobs to be had."9

Caseworkers and service providers we interviewed also reported that their
clients tend to have little work experience and low education levels,
making them less competitive in the job market. In several areas,
caseworkers and service providers said that workers that had previously
been employed but who had been laid off were more likely to be hired for
the few jobs available than were TANF clients. Several caseworkers also
said they had some clients who could not find employment in the county
because they had "burned their bridges" with every employer in town.
Others noted that having a bad experience with one employer in a rural
community could earn someone a bad reputation with all prospective
employers because information about people spreads easily.

Studies looking at the earnings of current or former TANF clients have
found low earnings in rural areas. The Urban Institute study of 12 rural
locations in four states found that all locations reported that most jobs
obtained by welfare recipients paid minimum wage and that few jobs offered
opportunities for advancement.10 A study by Mathematica comparing earnings
of current or former TANF clients in rural and urban areas in Nebraska
found that earnings were much lower in rural areas than in urban areas.11
In addition, a 1999 study comparing selected urban and rural areas of
Virginia found that the rural areas had a disproportionate number of women
who were working but still lived below the poverty level.12

9Mark Harvey, Gene F. Summers, Kathleen Pickering, and Patricia Richards,
"The Short Term Impacts of Welfare Reform in Persistently Poor Rural
Areas." In Rural Dimensions of Welfare Reform, edited by Bruce A. Weber,
Greg J. Duncan, and Leslie A. Whitener, 375-409. Kalamazoo Michigan: W.E.
Upjohn Institute for Employment Research, 2002.

10Pindus.

11Michael Ponza, Alicia Meckstroth, and Jennifer Faerber. Employment
Experiences and Challenges among Urban and Rural Welfare Clients in
Nebraska. Mathematica, August 2002.

12Sarah Bosley and Bradford Mills. How Welfare Reform Impacts
Non-metropolitan and Metropolitan Counties in Virginia. Rural Development
Program for Community Vitality, Virginia Tech, September 1999.

On the other hand, the welfare reform-related studies that have looked at
employment in rural areas present a more positive picture. Of the two that
used national samples to compare employment of single mothers in rural and
urban areas,13 one found that single mothers in rural areas were just
about as likely to be working as those in urban areas,14 and the other
found that single mothers in rural areas were more likely to be working
than those in urban areas.15 The above-mentioned Mathematica study found
that TANF clients living in rural areas in Nebraska were more likely to be
employed than those in Nebraska's urban areas.16

    Shortages in Child Care and Other Services Create Difficulties in Addressing
    Clients' Employment Barriers

"Lower population densities in rural areas make it more difficult to
support some specialized services," according to an analysis of research
on welfare reform in rural areas that cited specialized education and job
training, formal paid child care, and mental health services as being less
available in rural areas.17 Caseworkers we met with also identified
shortages in services as a problem that makes it difficult for TANF
clients to address their barriers to working such as not having someone to
care for their children, not meeting the basic education requirements for
most jobs, having mental health issues that make keeping a job unlikely,
and missing teeth or having other unattractive and unhealthy dental
problems. In our site visits, caseworkers and service providers recounted
different shortages in services from county to county, but they echoed
much of the research literature:

o  	Child care. A lack of child care centers, infant and toddler care, or
child care on nights and weekends was a commonly cited shortage

13For both studies, the samples were taken from the Current Population
Survey for a period in 1998 or 1999.

14Robert I. Lerman, Signe-Mary McKernan, and Nancy Pindus. "Welfare
Reforms and Employment of Single Mothers: Are Rural Areas Keeping Pace?"
Rural America 16 (2001): 22-27.

15Daniel T. Lichter and Leif Jensen. "Poverty and Welfare among Rural
Female-Headed Families." Rural America 16 (2001): 28-35.

16This study looked at employment status 1 year after the sample of TANF
clients was drawn. Therefore, those included in the study could have
already left TANF.

17Greg Duncan, Leslie Whitener, and Bruce Weber. "Lessons Learned: Welfare
Reform and Food Assistance in Rural America." In Rural Dimensions of
Welfare Reform, edited by Bruce A. Weber, Greg J. Duncan, and Leslie A.
Whitener, 455-470. Kalamazoo, Michigan: W. E. Upjohn Institute for
Employment Research, 2002.

identified in rural areas we visited. However, in two counties, we heard

that there was a sufficient number of child care centers. A study that

looked at welfare reform in selected persistently poor counties in four

states found that finding reliable child care was a major barrier to

employment for welfare recipients, that most recipients relied

primarily on family and friends for child care, and that this type of
child

care was not always reliable.18 Case studies of seven communities in

Iowa found that "many low-income rural residents experience

continuing problems in securing adequate and affordable care for their

children," that "child-care centers are a rarity in rural communities,"

and that "most recipients rely on home day care providers or relatives

to care for their children."19

o  	Education services. Few options for adult basic education (ABE) and
general equivalency diploma (GED) classes was identified as a problem in
some areas. For example, in Dickenson, Virginia, the only adult basic
education class meets one evening a week, and GED classes geared toward
people with learning disabilities are not available. However, caseworkers
in counties with community colleges often said that there was adequate
availability of GED classes.

o  	Mental health services. In some areas, we heard there were long waits
for mental health services and drug treatment programs were not available.

o  	Dentists. In some counties, service providers and TANF clients
identified the lack of dentists who accept Medicaid as a severe problem.

Other Issues Hamper In some of the more economically depressed areas that
we visited, Employment Potential for caseworkers stressed that they often
had a high prevalence of hard-to-Clients in Some serve clients with severe
problems. These problems include very low

education levels, many clients claiming disabilities, and family
andEconomically Depressed personal problems.

    Areas

18Harvey and others.

19Cynthia Needles Fletcher, Jan Flora, Barbara Gaddis, Mary Winter and,
Jacquelyn Litt. "Small Towns and Welfare Reform: Iowa Case Studies of
Families and Communities." In Rural Dimensions of Welfare Reform, edited
by Bruce A. Weber, Greg J. Duncan, and Leslie A. Whitener, 201-229.
Kalamazoo, Michigan: W. E. Upjohn Institute for Employment Research, 2002.

o  	Very low education levels. In several areas, caseworkers mentioned
that they had illiterate clients and clients with only a grammar school
education. Caseworkers in Harlan County, Kentucky, and southwestern
Virginia said this problem was acute in their areas. These caseworkers
linked low education levels to the fact that, in the past, an education
was not needed for a man to get a well-paying job in the areas' coal
mines. Also, it was a commonly held view that women did not need an
education to stay home and take care of the family. For almost all
available jobs, people with very limited educations will be automatically
disqualified, according to caseworkers and service providers we spoke
with. Also, caseworkers said that they must require the clients to meet
TANF work requirements, even if the clients cannot qualify for any
available paying jobs with their current lack of education. Further, such
clients need a GED to become employable, but attaining one can take years
when the clients start off at the grammar school level.

o  	Clients claiming disabilities. In two areas we visited-Harlan County,
Kentucky, and southwestern Virginia-caseworkers said they have many
clients who believe they are too disabled to work. The caseworkers said
that while some of these clients might be able to qualify for disability
payments from the Social Security Administration, others will not qualify
and will remain on TANF.

o  	Family and personal problems. A family background of welfare
dependence, families who oppose women working outside the home, domestic
violence, and substance abuse were identified as significant problems in
some rural areas. In several areas, caseworkers and service providers
mentioned that many of their clients come from families who were
welfare-dependent and did not convey a work ethic to their children. In
Harlan County, Kentucky, and southwestern Virginia, caseworkers and
service providers said that some of their clients come from families who
believe women belong in the home and who oppose the clients going to work.
They also said that domestic violence is common among their clients.20 For
example, caseworkers in southwestern Virginia said they had had clients
who had been beaten by their husbands when they attempted to work outside
the home to meet TANF work requirements. Caseworkers also mentioned

20For information on the prevalence of domestic violence among welfare
recipients, see GAO, Domestic Violence: Prevalence and Implications for
Employment Among Welfare Recipients, GAO/HEHS-99-12 (Washington, D.C.:
November 24, 1998).

substance abuse as a common problem among clients in several areas we
visited.

    Rural TANF Programs Foster Collaboration and Personal Attention from
    Caseworkers

Caseworkers and service providers cited strengths that their areas have in
implementing welfare reform that they associate with the rural
environment.

o  	Collaboration. Caseworkers and service providers said that the limited
resources available in rural areas force people to work together to solve
problems. They also said they often have personal contacts with employers
and other community resources that provide a foundation for trust and can
lead to job placements and other strategies to help clients. Also,
caseworkers and service providers from different programs and agencies
often get to know each other and can call each other directly, without
going through another bureaucratic level, to get help in solving a
client's problem. A report on the results of case studies in 12 rural
counties in four states stated that the "positive attitude,
resourcefulness, and resilience of the rural communities we visited are
the most notable aspects of welfare reform implementation we observed."
This study also found "flexibility of local caseworkers and other service
providers in making alliances."21

o  	Staff attention and knowledge. Caseworkers in some rural areas
expressed the view that they can give their clients more personal
attention than their urban counterparts can offer because of a smaller
caseload. However, caseworkers in other rural areas did not believe they
had fewer clients than caseworkers in urban areas. Some caseworkers said
they had considerable knowledge about their clients, which is helpful in
addressing the clients' problems. For example, one caseworker said she had
insight into some of her clients' lives because, at one time, their
grandmothers and mothers had also been her clients. Authors of a study of
welfare reform in Nebraska suggested that "rural case managers may be more
successful at engaging their clients" in the TANF employment program
because they found that rural clients were more likely than urban clients
to participate in the program.22

21Pindus. 22Ponza and others.

  Rural TANF Programs Transport Services to Clients and Leverage Resources to
  Provide Mentoring, Transportation, Job, and Child Care Assistance

The rural TANF programs we visited have devised many ways to bring
services to distant clients, and they have tended to leverage their
resources by collaborating with one another and with community
institutions, focusing effort as they did so on helping clients surmount
rural shortages in transportation, child care, and jobs.

    Rural Programs Devised Modes of Service Delivery That Transcend Geography

The rural TANF programs we visited have bridged distances to TANF clients
with a variety of approaches ranging from bringing instructors and
equipment to them to using technology to enable clients to access services
without leaving home.

o  	Virtual social services. The Work Central Career Advancement Center in
Rocky Mount, North Carolina, is a call center that equips social workers
with telephones and sophisticated computer systems in an attempt to help
former TANF clients and other low-income people achieve economic
self-sufficiency. According to a state TANF official, the strategy has
reduced the rate of return to TANF cash assistance in this area of the
state-8 percent for Work Central's customers compared with 15 percent for
the state's other former TANF clients. Work Central's social workers, or
customer service representatives, spend their days on the telephone with
low-income people in 11 rural counties in eastern North Carolina providing
specific information, such as job openings, or helping customers solve
problems and develop plans for improving their economic situation. The
representatives place regular follow-up calls to customers and will also
connect them to service providers-staying on the phone if needed. The
representatives use numerous computer tools, including an electronic case
management system with information on past and current benefits received
by the customers. Also, a geographic software program depicts the
customer's area and identifies nearby service providers, employers, and
other area customers who might be incorporated into the customer's support
system, such as in carpooling or babysitting. The representatives also
have Internet links to service providers that detail hours of operation
and locations.

o  	Itinerant courses and instructors. A few of the rural TANF offices we
visited sponsor training programs with traveling instructors. That is,

courses may not be held in the same location year-round, but may be
offered in more than one location over the course of the year to maximize
clients' opportunity to enroll. To accommodate clients throughout a large
New Hampshire county, for example, a 3-week life skills course was held
alternately in the north and south sections. Another New Hampshire TANF
program offered GED courses in different areas around the county.

o  	Workforce mobile lab. To give low-income residents access to computer
training, a technical college in northeastern Arkansas outfitted a van
with computers and transported it to various program sites throughout the
county. A community development organization enlisted the van to conduct
online self-guided training courses for participants. TANF clients were
offered a pre-employment training curriculum, choosing from topics that
included substantive GED preparation, skills assessments, and soft skills
instruction.

o  	Distance learning by videoconference. In New Mexico, community college
courses have been available to TANF clients by videoconference at several
area high schools. According to staff, telecommunication has made it
possible for many of the program's single mothers to take classes without
having to drive 100 miles round trip from remote locations.

o  	Bringing services into clients' homes. Some programs we visited have
sent counselors out to visit with clients in their homes, particularly
when they do not have transportation. For example, the state of New
Hampshire has contracted with a nonprofit organization to provide in-home
counseling services for its hardest-to-serve TANF clients-individuals who
demonstrate evidence of mental illness, substance abuse, or domestic
violence. The home visits are conducted over a 90-day period on a flexible
schedule that includes nonbusiness hours to accommodate family needs.

Figure 5: Customer Service Representative at Work Central's Call Center in
North Carolina Using Geographic Software Program During a Call to a
Customer

Source: GAO.

    Rural TANF Programs Have Leveraged Their Resources through Collaboration and
    Partnerships

Partnerships and collaboration were a common practice for many of the
rurally situated programs we studied. From state to state and agency to
agency, caseworkers described collaborative arrangements between TANF
offices and other government agencies, nonprofit service providers,
educational institutions, private sector employers, and neighboring
counties. These partnerships ranged from loose, ad hoc affiliations to, in
one instance, a group of counties' Departments of Social Services joining
together to create a nonprofit entity to help TANF clients become
employed. According to those we interviewed, the collaborations helped
leverage local resources and spawned new strategies.

o  	Other service providers. Many of the rural TANF officials we visited
explained that they convene regular meetings with other social service
providers in their local areas to share ideas as well as information about
community and program developments. For instance, TANF officials from
Nicollet County in south central Minnesota said their eligibility and
employment counselors participate in both monthly and

quarterly meetings where ABE staff, public health officials, child
protective services, and the local housing authority are all represented.
Caseworkers and service providers cited these gatherings as a key
component in building rapport with one another, learning about what
partner agencies are doing, and fostering collective brainstorming
sessions for solving difficult problems. The call center (Work Central) in
Rocky Mount, North Carolina, partnered with the state employment agency
and, as a result, receives advance updated job listings, which allows Work
Central's customer service representatives to call their customers about
suitable job openings the day before the listings are made available to
the general public, according to Work Central administrators.

o  	TANF programs in neighboring counties. In 1998, the Departments of
Social Services in eight jurisdictions in southwest Virginia with high
unemployment joined together to create a nonprofit organization to help
TANF clients become employed. The organization, called Occupational
Enterprises, Inc. (OEI), started with a $750,000 grant of welfare-to-work
dollars from the state of Virginia and has since applied for and received
numerous grants from governmental and private sources to finance its
operations. OEI uses its grants to provide employment services for all
TANF clients in the welfare reform program in the eight jurisdictions. By
applying for grants on behalf of the combined population of all the
participating rural counties, OEI can qualify for much larger funding
amounts than it would if it were working with only one rural county. OEI
managers believe that by covering many counties, they greatly reduce
administrative expenses and can provide far more services than could be
provided if each county were operating independently. This occurs because
all locations benefit from the development of one program, and duplication
of effort is avoided. Also, more staff people are available to
collaboratively solve problems and support one another when needed.
Further, instead of needing a staff person in each county who can provide
a service or program, one or two staff can specialize and serve all
locations. Recently, three additional jurisdictions have joined the
original eight to be part of the OEI consortium.

o  	Community colleges. Often, service providers named their local
community college as yet another key partner in the network of service
providers working to assist TANF clients in finding work and becoming
self-sufficient. The counties we visited in Mississippi and New Mexico,
for instance, had designated the local community college as the contract
provider of TANF workforce training services. In fact, Mississippi's
governor was so pleased with the job placement rates of

local community colleges that he proposed giving the community college
system oversight of Workforce Investment Act (WIA) programs statewide.23

o  	WIA collaboration. WIA and TANF programs in Logan County, West
Virginia, worked together to establish driver's education courses, using
WIA funds, for welfare and workforce clients who had never obtained a
license. New Hampshire officials took a similar approach, allocating a
portion of their WIA funding to provide specialized computer training for
TANF clients.

o  	A local bank. The Work Central Advancement Center in Rocky Mount,
North Carolina, partnered with a local bank to offer bank accounts to Work
Central customers in an effort to save customers the exorbitant fees
charged by independent check-cashing services. Unlike a typical checking
account, these accounts provide debit cards only and require that
sufficient funds be available in order for a withdrawal to be made, thus
eliminating the possibility of bounced checks, which Work Central learned
had been at the root of many customers' problems with banks in the past.

In addition to the partnerships described here, program officials also
described other collaborative arrangements, namely partnerships centered
on employment and transportation that are described in other sections of
this report.

    Rural Programs Have Collaborated with Others to Provide Mentoring for TANF
    Clients

A number of rural TANF programs have provided TANF clients with more
informal support from their communities in the form of mentors drawn from
work sites, church congregations, or the community at large. According to
officials we spoke with, the mentors offer advice and serve as role
models, particularly for clients with a family history of welfare who lack
experience in the workplace.

o  	Mentoring in New Mexico. Building on a state-level partnership between
the New Mexico Aging and Long Term Care Department and the Department of
Human Services, the state of New Mexico launched

23The Workforce Investment Act was passed in 1998 to consolidate services
of many employment and training programs, mandating that states and
localities use a centralized service delivery structure-the one-stop
center system-to provide access to most federally funded employment and
training assistance.

the Golden Opportunities for Lifelong Development (GOLD) Mentoring Program
in 2000. Capitalizing on the state's sizable population of retired
residents, the GOLD Mentoring Program pairs retirees with TANF clients in
the same community, in hopes that mentors will fill gaps in caseworker
service delivery and develop a level of rapport with clients that is not
always possible for caseworkers, given the competing demands on their
time. Mentors coach clients in a variety of contexts, including family and
interpersonal relationships, preemployment preparation and job search
activities, as well as in clients' interactions with other government
entities. For example, mentors told us that it was not uncommon for
mentors to accompany clients to court appearances or for mentors to
intercede on behalf of clients trying to navigate various government
benefit systems.

o  	Mentoring in Forrest City, Arkansas. A community development
corporation in Forrest City, Arkansas, operates a mentoring program for
TANF clients that relies on unpaid volunteers from the community. Known as
PREP, which stands for People Realizing Employment Possibilities, this
program constitutes the support component of a local subsidized employment
initiative. Specifically, the mentoring program was created to help TANF
clients facilitate workplace problem solving and to provide a model of
appropriate workplace norms and behaviors during subsidized job training
arrangements with area employers. Mentors meet with clients about once a
week to gauge progress and help resolve issues that have arisen. Although
mentors do not necessarily work at the same location as their assigned
clients, cognizant staff told us that mentors occasionally make workplace
visits to clients' work sites.

o  	Employer-based mentoring in southern Minnesota. During the late 1990s,
staff from a 10-county region in the southeastern part of Minnesota
partnered to develop an employer-based mentoring program intended to help
TANF clients acclimate to new work environments and deal constructively
with conflicts to avoid termination, and to help area employers improve
retention. The program trained mentors in conflict avoidance and
resolution strategies and paired them with new hires. Although the primary
goal of the program was to provide support for TANF clients entering the
workforce, the service was made available to all new employees hired by a
participating employer. By targeting all new employees, the program
avoided identifying or possibly stigmatizing TANF clients in the workplace
and also provided more of an incentive for employers to participate. All
told, the program trained approximately 1,200 mentors in 475
organizations, some of which experienced marked improvements in their
retention rates

during that time. For example, one nursing home that employed a
considerable number of TANF clients was concerned about its high staff
attrition rates. After implementing the mentoring program, staff turnover
at the nursing home dropped from 60 percent to 4 percent and eventually
stabilized at about 20 percent, according to program staff.24

    Rural TANF Strategies Have Targeted Shortages in Transportation, Jobs, and
    Child Care

Expanded Transportation Options

The rural TANF programs that we visited had focused a substantial amount
of their efforts on remedying at least one of three shortages they said
prevented many TANF clients from finding or keeping employment-
transportation, job options, and child care. In each area, they had
tailored services to meet particular needs and were grooming clients for
the particular opportunities that existed in their local markets. Some
placement programs sought to remedy skill deficiencies to make clients
more marketable, while others targeted the area employers, developing
industry-specific training modules, outreach initiatives, and economic
incentives in hopes of parlaying those relationships into jobs for TANF
clients. Research suggests that training programs designed to reflect the
needs of the local labor market tend to result in positive outcomes for
participating clients.25

Rural TANF programs had implemented a variety of initiatives, ranging from
private vehicle programs to dedicated transport vans to helping
individuals acquire or regain their driver's licenses.26

o  	Donated car programs. A number of the rural program officials we spoke
with advocated private vehicle ownership programs as the best solution to
the transportation problems that affect many rural TANF clients.
Specifically, supporters of private vehicle ownership contend that mass
transit options can be insufficient and unreliable in rural areas and
argue that to guarantee regular work attendance, clients must own their
own cars. The Good News Garage, a nonprofit

24This program was funded initially by a private foundation grant, and
program administrators also collected a fee from participating employers
to underwrite operating costs. However, after grant funding was exhausted,
and as a result of the concomitant economic downturn (which decreased the
demand for new workers), the program was all but discontinued in 2003.

25Rural Welfare to Work Strategies, Research Synthesis. Macro
International Inc., June 10, 1999.

26For information about more transportation strategies in rural areas, see
Pamela Friedman, Transportation Needs in Rural Communities. Rural
Assistance Center, March 2004.
http://www.raconline.org/info_guides/transportation/issuenote.html

organization founded in Vermont but adapted in other parts of the country,
has been a pioneer in this area, soliciting donated cars, evaluating and
refurbishing them, and then placing them in the hands of TANF clients for
a nominal fee. Because this program relies on donated, rather than
purchased, cars, TANF clients in New Hampshire, for example, are only
required to pay a fixed price of $1,100, which may be paid by TANF or
another benefit program, to partially cover the cost of refurbishing.
Other variations on the Good News Garage concept require participants to
enter into a lease agreement, where the purchaser agrees to pay a fixed
monthly fee over a set period, at the end of which clients in good
standing are given the title to the car. Most of these programs provide
some type of support to client participants in the form of car repair
clinics, referrals to modestly priced garages, even subsidies for
insurance or repairs. The program administrators we spoke with cited a
number of positive outcomes associated with private vehicle ownership: In
the case of Good News Garage, program officials asserted that 75 percent
of the TANF recipients who received vehicles subsequently left the welfare
rolls. Further, a study examining the impact of Vermont's Good News Garage
program on the earned income of participating TANF clients found that
average incomes for participating clients rose $220 per month after they
had been outfitted with a vehicle.27

o  	Car loan programs. Other car programs seek not only to provide clients
with vehicles, but also to help them raise their credit ratings in the
process. Specifically, some programs focus on helping clients obtain new
cars or finance newer vehicles through low-cost loans with generous
repayment terms. For instance, in New Hampshire, a program called
Wheels-to-Work offers a tax credit to dealerships in return for donations
of high-quality used cars that can then be sold to low-income families for
about half the cars' appraised value. Because the average cost to the
client of these cars is around $3,300, requiring most clients to obtain
loans, Wheels-to-Work also serves as a mediator between clients and
lenders. In Minnesota, a consortium of counties in the south central
portion of the state received funding to launch a similar car loan program
for TANF clients. In this instance, the consortium used the funding not to
purchase or repair cars, but to establish a loan guarantee fund that
facilitated the development of relationships with two area banks on the
condition that the car program would guarantee

27Marilyn T. Lucas and Charles F. Nicholson. "Subsidized Vehicle
Acquisition and Earned Income in the Transition from Welfare to Work."
Transportation 30 (2003): 483-501.

25 percent of any defaulted loan. In addition to mediating between the
bank and the loan applicant, staff affiliated with the car loan program
also counseled applicants on consumer credit issues, provided insurance
referrals, and established relationships with area car dealers. Although
staff operated as mediators between the client and the lender, the program
required clients to choose a preferred lender and act as the primary point
of contact. By requiring clients to take loans and interact with the bank
holding the loan, the program sought to improve clients' credit ratings,
financial literacy, and confidence in dealing with financial institutions.
According to officials overseeing the program, less than 30 percent of
participating car owners defaulted on their loans.

o  	Van, bus, and other dedicated transportation systems. Instead of
allocating resources for private vehicle ownership programs, some of the
rural TANF programs we visited elected to subsidize clients' use of
existing transportation systems, sponsor their own van transport service,
or create reciprocal agreements with other social service programs already
providing transportation (e.g., Head Start).28 For example, Logan County,
West Virginia, and Coahoma County, Mississippi, provide vouchers for
clients to use the local fixed route bus system. Other localities have
chosen to sponsor their own van services, but the distances separating
relatively small numbers of clients drives up the cost of van services.
For instance, according to one official in St. Francis County, Arkansas,
the price of these services in his area was as high as $2,000 per client
per month. One West Virginia county suffering from limited public
transportation partnered with the local Head Start program to secure the
use of its van for TANF client transport when Head Start was not in
session.29

o  	Obtaining or reinstating driver's licenses. To address the issue of
clients who had never been licensed to drive, the local TANF program in
Logan County, West Virginia, partnered with Workforce Investment

28Head Start is the largest federal program supporting early childhood
development and offers a range of services to families in communities
nationwide, including educational, medical, dental, mental health,
nutritional, and social services.

29To obtain more information on federal programs offering transportation
services for lowincome families, see GAO, Transportation-Disadvantaged
Populations: Some Coordination Efforts Among Programs Providing
Transportation Services, but Obstacles Persist. GAO-03-697 (Washington,
D.C.: June 2003) and GAO, Welfare Reform: Job Access Program Improves
Local Service Coordination, but Evaluation Should be Completed. GAO-03-204
(Washington, D.C.: December 2002).

Job Development, Job Training, and Tailored Employment Assessments

Board staff from the same locality to offer driver's education courses to
their respective service populations. To help TANF clients deal with large
unpaid traffic tickets and avoid having their driver's licenses suspended,
program officials in Coahoma County, Mississippi, are exploring the
possibility of working with local authorities to develop an incremental
payment program for TANF clients. This initiative will be modeled after a
program operated by the City Court Clerk's Office in Memphis, Tennessee.
Although the Memphis program does not specifically target the TANF
population, the goal is the same: to provide residents in danger of facing
license suspensions because of unpaid fines an opportunity to establish an
arrangement allowing them to make incremental payments and pay down those
fines over time. According to the program's administrator, the incremental
payment program has dramatically reduced the number of outstanding or
inactive traffic fines and boosted the city's traffic fine revenue from $4
million to approximately $14 million annually.

Rural TANF programs we visited have developed a variety of approaches to
find employment opportunities for TANF clients, to provide training that
will make TANF clients more marketable to area employers, and to assess
clients' skills and barriers to employment.

o  	Job development. In several counties we visited, one or more staff had
been given the responsibility of developing and maintaining contacts with
employers so that when the employers had job openings, they would give
TANF clients the opportunity to fill the openings. Also, caseworkers in
several counties said they sometimes set up subsidized employment
arrangements for clients. That is, the welfare program would pay all or
part of a client's salary for a given period of time to encourage
employers to give the clients a chance to learn the job and prove
themselves good employees. Several caseworkers said that subsidized
employment frequently turned into permanent (unsubsidized) jobs for
clients. Also, caseworkers in some areas said they had set up unpaid job
opportunities for clients to help them build work experience. In southwest
Virginia, OEI established workspaces in two local manufacturing plants
where their clients receive on-thejob training and perform unpaid work
under the supervision of plant management. Under this arrangement, plant
management agrees to forgive clients' mistakes and absences. Also, clients
who turn out to be successful workers get priority for hiring at the
plants. OEI has also established a downtown ceramics shop and store for
Appalachian crafts where TANF clients work, unpaid, to learn what is
expected of

them in the workplace and to develop work experience that can help them
obtain and retain paid employment.

o  	Skill-based training. Some of the TANF programs we visited offered
skill- or industry-specific training programs designed to help clients
develop skills relevant to a particular local employer or industry. For
example, administrators affiliated with the local community college in
Coahoma County, Mississippi, formed a partnership with a large local
casino-hotel complex, one of the few employers in the county with a need
for low-skilled workers. Community college officials, working in
conjunction with casino personnel, developed a curriculum to teach TANF
clients relevant hospitality skills including housekeeping, valet,
security, and cashier services. The casino also funded the construction of
a mock hotel room in one of the classrooms at the college to give students
an opportunity for firsthand experience in chemical safety and other
housekeeping protocol. Instructors monitor students' progress and refer
job-ready participants to hiring personnel at the casino. According to
staff at the community college, TANF clients feel that participants in the
training program have a better chance of being hired by the casino than do
those who submit an application independent of the program. Casino
officials also said that the retention rate for those referrals tends to
be considerably higher than the industry standard.

Figure 6: Mock Hotel Room for Housekeeping Training at Community College
in Mississippi

Source: GAO.

To encourage a local manufacturer to employ TANF clients, program
officials in northern New Hampshire's Coos County invited the employer to
assist in designing a 10-week course for TANF clients that would impart
the skills necessary for assembling prefabricated modular homes. When the
corporate catalyst for the project began to experience financial
difficulties and was forced to temporarily suspend hiring, program
officials explained that some of the clients who participated in the
training were hired by other employers who could capitalize on their new
skills. A local TANF agency in Goodhue County, Minnesota, also emphasizes
practical skills and helped the local community college develop a
short-term welding course that covered the fundamentals and laid the
groundwork for participants interested in pursuing certification.

o  	Certified computer training courses. At least two of the states we
visited also sponsored computer training for TANF clients culminating in
industry-recognized certification. For instance, New Hampshire's TANF
program gives some clients the opportunity to enroll in an intensive
14-week computer training course designed and certified by Microsoft.
Curriculum topics include word processing, spreadsheets,

and presentation software. Program officials in one New Hampshire county
told us that among its first cohort of graduates from the computer
training program, all but one had left TANF at the time of our interview.
In Coahoma County, Mississippi, TANF recipients can participate in 4-week
computer training certification courses consisting of instruction in the
basic use of computer hardware, software, networks, and the Internet.

o  	Microenterprise. In some of the New Mexico communities we visited,
weak economies and job scarcity prompted program officials to pursue
microenterprise ventures (also known as self-employment) as a viable
alternative for TANF clients seeking work. Specifically, an
Albuquerque-based nonprofit specializing in training and technical
assistance for small business start-ups developed a training program
specifically for TANF clients interested in starting their own businesses.
Microenterprise staff provide TANF clients with consulting expertise as
well as financial literacy training and other instruction in basic
business principles. In addition, the group also maintains an online
marketplace for clients to sell their products. The group has assisted
TANF clients in launching a wide array of businesses, from arts and crafts
to landscaping and child care.

o  	Scheduling accommodations. In the state of West Virginia, TANF
officials have structured a 6-week life skills and pre-employment training
course for TANF clients such that each week constitutes a discrete module
not dependent upon other modules to be understandable. This allows TANF
clients to enroll at the beginning of any week, rather than having to wait
several weeks for the course to begin again. In addition, the stand-alone
format of West Virginia's training makes it possible for clients to enroll
and obtain credit for individual modules as their schedules allow. In
Harnett County, North Carolina, enrollees in GED classes have the option
of performing the preparation work in a classroom environment or of
engaging in more individualized self-paced learning.

o  	Comprehensive screening and assessment. OEI, a nonprofit organization
that performs employment services for TANF clients from 11 counties in
southwest Virginia, developed an assessment tool and process for all new
clients. The assessment, which is managed by a licensed clinical social
worker and registered nurse, screens for a number of problems that the OEI
staff believe are very common among clients in their area, such as
learning disabilities, domestic violence, substance abuse, and physical
and mental health problems. The assessment also evaluates clients'
educational attainment; legal, family,

and employment histories; transportation and child care needs; skills; and
employment goals. The results of the assessment provide the foundation for
decisions about appropriate activities for promoting individual employment
and self-sufficiency as well as client aptitudes for various types of
work.

o  	Screening to assist clients claiming disabilities. Program officials
in Harlan County, Kentucky, employ a "good cause" specialist, a dedicated
caseworker responsible for visiting clients who claim either to have
disabilities severe enough to prevent them from working or to have primary
caregiver responsibility for a family member with a disability. The visits
to clients' homes are intended to give the caseworker an opportunity to
assess clients' living situations firsthand, learn more about the clients'
claimed disabilities, and identify any activities the clients are already
doing that might be parlayed into countable work activities. For example,
program officials in Harlan County noted that on a number of occasions,
the good cause specialist's visit to a client's home uncovered existing
child or elderly care arrangements with the potential to be expanded into
small businesses that would not only count toward the work requirements
but also could further clients' self-sufficiency goals. Staff members
related one anecdote where a TANF client had claimed a medical exemption
as a result of responsibilities stemming from the care of her disabled
mother, rather than a medical condition of her own. Staff members were
able to arrange day care for the client's mother, and the client was able
to return to work.

                              Increased Child Care

To produce a larger, more stable, better-trained corps of child care
providers, child care administrators in some local communities have
mounted child care initiatives to help meet community needs.

o  	Building capacity among current child care providers. As part of a
short-term pilot program in Harlan County, Kentucky, the local child care
referral group partnered with Early Head Start staff to expand the number
of openings for infants and toddler-age children.30 To accomplish that
goal, a dedicated staff member developed lesson plans and a curriculum
that provided a foundation for certification. In the state of Kentucky,
certified providers are allowed to care for more children than uncertified
providers and also qualify for larger per child

30In 1994, Congress established Early Head Start, a program that performs
much the same function as its counterpart, Head Start, but serves a
different demographic, namely, expectant mothers as well as infants and
toddlers from birth to age three.

state subsidy payments. Staff launched the program by visiting current
providers in their homes to share certification information and deliver
safety equipment such as cabinet latches, fire extinguishers, and safety
gates. In addition, the initiative's primary point person also hosted
periodic discussion groups that were conducted at a central location.

Although the pilot program was only funded for 1 year, program
administrators told us that approximately 15 of the original 20
participants maintain their certification, and an additional 2 have gone
on to receive advanced certification allowing them to care for up to 12
children in their homes. They credited the initiative for giving rise to
Harlan County's first child care slots open to infants and toddlers. In
addition, one staff member mentioned that the training and subsequent
increase in income shifted perceptions among participating child care
providers, prompting them to view child care as a profession rather than
as a temporary measure for generating additional household income. Program
officials went on to say that in their experience, another benefit of
increasing the number of home-based child care slots stemmed from the
ability and willingness of in-home child care providers in their community
to offer after-hours care, a service that center-based facilities had not
succeeded in doing.

o  	Recruiting new providers. In a remote St. Francis County, Arkansas
community, human services staff coordinated with child care specialists
from Little Rock to increase the availability of child care in the area.
Staff utilized church networks and storefronts to heighten community
awareness about the need for child care providers and followed up with an
informational session for interested community members. After attending
the informational session, potential providers were directed to enroll in
licensing training. As a supplement to the licensing curriculum, staff
spearheading the recruiting effort also partnered with the Small Business
Administration's local office to offer a voluntary 6-week business
planning component. Ultimately, the outreach program yielded four or five
new child care providers.

HHS's Administration for Children and Families has planned and undertaken
several initiatives that could assist TANF programs and TANF families in
rural areas. Several ACF offices with different responsibilities are
involved in these initiatives.

Conferences addressing rural TANF issues. In September 2003, ACF and the
Department of Labor jointly sponsored a 2-day rural conference for one of
ACF's 10 regional offices. The conference was designed to

  HHS Has Several Initiatives That Could Benefit Rural TANF Programs  o

improve service delivery to families in rural areas by offering rural
service providers an opportunity to discuss strategies for addressing
challenges. Collaboration with community partners was emphasized.
Officials from 9 counties across 5 states participated in the conference.
ACF sponsored similar conferences in 1999 and 2000 that were geared toward
sharing rural welfare-to-work strategies. Approximately 11 states and 4
regions were represented at each year's conference. Topics covered at
these conferences included transportation strategies, child care
strategies, and economic and community development.

o  	Demonstration projects. ACF's Office of Planning, Research, and
Evaluation is currently sponsoring a demonstration project to evaluate the
effectiveness of welfare-to-work strategies being used in rural areas of
Illinois and Nebraska. These two states are testing different approaches
to addressing employment barriers common in rural places. For example, the
Illinois Future Steps program offers intensive, employment-focused case
management including job placement assistance and postemployment support
assistance. Future Steps staff support and monitor clients' progress
closely through regular meetings and home visits. The second program,
Building Nebraska Families, focuses on improving the basic life skills of
hard-to-employ people so they can participate in job search and job
training activities, as well as address personal and family barriers to
self-sufficiency. Educational services are provided mainly through home
visits and cover subjects such as household management, parenting, and
decision making. A complete evaluation of the effectiveness of these
interventions will be available in 2007.31

o  	Technical assistance to TANF programs. ACF's Office of Family
Assistance (OFA), which is responsible for administering the TANF block
grant, provides technical assistance to TANF programs. One means through
which technical assistance is provided is the Welfare Peer Technical
Assistance Network. The purpose of the network, which was started in 2000,
is to provide technical assistance and facilitate information exchanges
among states, counties, and community-based organizations about promising
practices and lessons learned in implementing welfare reform. The network
provides technical assistance in response to specific requests from state
or local TANF programs. If the technical assistance

31For a summary of the implementation experiences for the programs
involved in the demonstration project, see Andrew Burwick, Vinita
Jethwani, and Alicia Meckstroth.

Implementing Welfare-to-Work Programs in Rural Places: Lessons from the
Rural Welfare-to-Work Strategies Demonstration Evaluation. Mathematica
Policy Research, Inc., April 2004. The report is available at
http://www.acf.hhs.gov/programs/opre/.

involves a site visit or teleconference, usually only the programs that
requested the assistance are included. However, other interested parties
may be included. Summaries and results of these meetings or conference
calls are posted on ACF's Web site.32 Three of the nine technical
assistance events that occurred during January through June of 2004 were
focused on rural TANF programs. One such event was a teleconference among
six states to discuss approaches to developing work experience sites in
tribal and nontribal rural areas.

o  	Promoting use of the Earned Income Tax Credit. ACF is also planning an
expansion of an initiative designed to increase the number of low-income
families in the Mississippi Delta region that claim the Earned Income Tax
Credit (EITC).33 The follow-on strategy is expected to focus more on rural
areas. While not yet implemented because of funding constraints, an
expansion of the Delta EITC initiative would train volunteers from local
universities and community colleges to prepare tax returns for rural
low-income families and ensure that they apply for the EITC.34 The
initiative would specifically target those families in the Delta region
that have recently left TANF. To accomplish this, the agency plans to
collaborate with the Internal Revenue Service, universities and community
colleges, as well as private companies.

o  	ACF's Rural Initiative Task Force. As a part of HHS's agencywide
initiative to strengthen rural families and communities, ACF has
established a rural task force to bring together ACF officials from across

32The Welfare Peer Technical Assistance Network Web site is located at
http://peerta.acf.hhs.gov/.

33The following states within the Mississippi Delta region will be the
focus of ACF efforts to increase the number of families claiming the EITC:
Alabama, Arkansas, Kentucky, Louisiana, Mississippi, Missouri, and
Tennessee.

34Some experts suggest that there may be higher financial incentives to
work in rural areas than in urban areas. This is because average incomes
are lower in rural than urban areas, and since the EITC and food stamps
are the same throughout the country, families relying on earnings plus
federal benefits achieve higher relative incomes in rural than in urban
areas. See Robert Lerman, Amy-Ellen Duke, Jesse Valente. Do Income Support
Levels and Work Incentives Differ between Rural and Urban Areas?
Washington, D.C.: the Urban Institute,1999.

the different ACF programs, including TANF.35 Officials in both
headquarters and regional offices participate in monthly meetings of the
Rural Task Force and discuss rural concerns and share strategies. One
activity the task force is undertaking is the development of a rural
e-mail Listserv in order to improve communication between ACF and rural
entities. The rural Listserv would provide a firm source of communication
between ACF and rural partners and share information such as training
opportunities, grant opportunities, technical assistance, and other issues
of concern to rural areas.

Concluding Observations

Rural counties shared in the nation's dramatic declines in TANF caseloads
that followed national implementation of welfare reform. However, these
national caseload declines do not necessarily mean that welfare reform has
been successful or that conditions are not challenging welfare reform in
rural areas. First, changes in the number of all families are likely to
affect the number of TANF families, and the number of all families in
rural areas is growing at a lower rate than that of urban areas.
Therefore, without other offsetting factors, rural areas' TANF caseloads
should be expected to decline more (or grow less), proportionately, than
urban areas' caseloads. Second, data on caseload declines do not reveal
whether those who left the caseload are employed and moving toward
selfsufficiency, which are essential pieces of information for assessing
the success of welfare reform. Third, many rural areas have experienced
significant caseload declines but still have a high proportion of their
families receiving TANF. Whether TANF recipients in these communities will
be able to find jobs and become self-sufficient depends, in part, on the
conditions in the communities where they live, such as the availability of
jobs, transportation, child care, and dental and medical care. The
disadvantaged socioeconomic conditions in these communities are likely to
pose challenges to the clients' ability to leave TANF and become
selfsufficient. Rural TANF programs we visited have developed some
strategies to help them address the challenges their clients face, but the
challenges continue.

35In 2001, the Secretary of HHS initiated an HHS-wide rural initiative by
appointing a crossdepartment task force to explore options and
opportunities for strengthening rural America. The HHS Rural Task Force
members are charged with examining ways to improve and enhance health care
and human services for rural Americans. Among the HHS Rural Task Force
accomplishments is the establishment of the Rural Assistance Center (RAC).
RAC is an online national resource for rural health and human services
information. RAC's Web site is located at http://www.raconline.org.

  Agency Comments
  and Our Evaluation

ACF has paid attention to rural areas in its administration of the federal
TANF block grant and has several efforts under way, such as its rural
demonstration study and its rural task force, that should be helpful in
addressing rural challenges. ACF can build upon these efforts by
continuing to look for ways to support rural TANF programs and by
continuing to support activities like the Mississippi Delta EITC
initiative and the creation of a rural e-mail Listserv that could help
spread the word about interesting strategies being used in rural areas.

We provided a draft of this report to HHS for its review. A copy of HHS'
response is in appendix IV. In its response, HHS said the report was
informative and did not disagree with any of the findings. HHS noted that
ACF has undertaken several activities focused on rural TANF, as cited in
the report. Further, HHS said it plans to establish a link to the final
report on its Welfare Peer Technical Assistance Network Web page to
facilitate rural TANF providers' access to the report. HHS also provided
technical comments on the draft, and in response to these comments, we
made changes where appropriate.

As agreed with your offices, unless you publicly announce its contents
earlier, we plan no further distribution of this report until 30 days
after its issue date. At that time we will send copies of this report to
appropriate congressional committees and other interested parties. We will
also make copies available to others on request. In addition, the report
will be available at no charge on GAO's Web site at http://www.gao.gov.

If you have any questions concerning this report, please contact me or
Clarita Mrena at (202) 512-7215. See appendix V for other contributors to
this report.

Cynthia M. Fagnoni, Managing Director Education, Workforce, and

Income Security Issues

Appendix I: Scope and Methodology of TANF Caseload Data Analysis

To address questions about the rural Temporary Assistance for Needy
Families (TANF) caseload, we collected and analyzed county-level TANF
caseload data from states. Below are details about these data and the
analysis.

o  	Time period covered by caseload data. We obtained average monthly
caseload data for the years 1997 through 2003. These data show the number
of families who received cash assistance, on average, during the months of
each year. Average monthly caseload is calculated by adding the caseload
for each month of the year and dividing by the number of months. For some
states, for some years, (primarily 1997 and 2003), the caseload data we
obtained are for fewer than 12 months of the year. For most states, the
data are for the calendar year, but for some states (noted in app. III)
the data are for the state fiscal year.

o  	Number of states covered by analysis. Different states were used for
the different analyses included in the report.

o  	Analysis of 2003 rural and urban TANF caseload data (used to determine
the percentage of TANF families living in rural areas) covers 48 states,
including the District of Columbia. The states not covered are Arizona,
Delaware, and Wisconsin because we were not able to obtain reliable
caseload data from these states in time for our analysis.

o  	Analysis of 2003 rural only TANF caseload data (used in figs. 1 and 2
and table 1 of app. II) covers 45 states-all states from which we were
able to obtain reliable caseload data, except the District of Columbia,
New Jersey, and Rhode Island, which do not have rural counties.

o  	Analysis of rural and urban caseload changes for the period 1997
through 2003 (used in fig. 3) covers 37 states that provided reliable
caseload data for each of those 7 years-California, Colorado, District of
Columbia, Florida, Georgia, Hawaii, Idaho, Illinois, Iowa, Kansas,
Kentucky, Louisiana, Maine, Maryland, Mississippi, Missouri, Montana,
Nebraska, Nevada, New Hampshire, New Jersey, New York, North Carolina,
North Dakota, Ohio, Oklahoma, Oregon, Rhode Island, South Carolina, South
Dakota, Tennessee, Texas, Utah, Vermont, Virginia, Washington, and
Wyoming.

o  	Analysis of rural caseload changes for the years 1997 to 2003 (used in
fig. 4 and table 2 of app. II) covers 37 states that provided reliable
caseload data for the years 1997 and 2003 and that have rural
counties-California, Colorado, Florida, Georgia, Hawaii, Idaho, Illinois,
Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Michigan,
Mississippi, Missouri, Montana, Nebraska, Nevada, New Hampshire, New York,
North Carolina, North Dakota, Ohio, Oklahoma,

Appendix I: Scope and Methodology of TANF Caseload Data Analysis

Oregon, South Carolina, South Dakota, Tennessee, Texas, Utah, Vermont,
Virginia, Washington, West Virginia, and Wyoming.

o  	Types of cases included in caseload data. The cases included in our
data are families in states' welfare programs, including families who
received cash assistance paid for with TANF funds and families whose cash
assistance was paid for with state maintenance-of-effort (MOE) dollars1
required by the TANF block grant.2 Some states have moved families from a
program paid for with TANF dollars to one paid for with MOE dollars, and
we included such families in our data in order to get a complete picture
of the rural welfare caseload and how it has changed over time. In the
report, we refer to all the cases in our data as TANF cases. A small
number of cases from tribal TANF programs may be included in some states'
data, but generally, cases from tribal TANF programs are not included in
our data.

o  	Data reliability check. To check the reliability of the data we
collected from states, we compared the TANF caseload data we collected
from each state (a combined total for all counties in a state) with ACF's
statewide caseload data for the years 1997-2003.3 When we found
significant differences between the two sets of data, we identified
reasons that would account for the differences.4 When we were unable to
account for the differences, we excluded from our analysis the data for
the year or years for which there were unaccountable differences.

o  	Demographic and socioeconomic data. In our analysis, we used data on
county demographics and socioeconomic characteristics, such as population,
unemployment rates, and median income. The U.S. Department of
Agriculture's Economic Research Service (ERS) provided

1For more information on the programs that provide cash assistance using
state maintenance-of-effort dollars, see GAO, Welfare Reform: With TANF
Flexibility, States Vary in How They Implement Work Requirements and Time
Limits, GAO-02-770 (Washington, D.C.: July 5, 2002).

2The caseload data we collected from states often differ from the TANF
caseload data the Administration for Children and Families (ACF ) reports
for states because the data we collected includes MOE cases and may have
been computed using different time periods and criteria than data used for
the ACF caseload.

3ACF does not have TANF caseload data by county; therefore, our
reliability check was done at the state level.

4We considered differences of over 10 percent of the ACF data to be
significant. Examples of reasons for differences between the caseload data
we collected from states and ACF data are the use of different time frames
and criteria for computing the data.

Appendix I: Scope and Methodology of TANF Caseload Data Analysis

data for our analysis that it compiled from the Bureau of the Census and
the Bureau of Labor Statistics. In addition, ERS provided data that it
developed on counties' classifications that we used to determine whether
counties were rural or urban. In order to determine the proportion of the
general population receiving TANF cash assistance, we divided 2003 TANF
caseload data (TANF families) by 2000 Census data on the number of
families in each county. We estimate that our resulting percentage is, on
average, biased upward by about 0.1 percentage point.

Appendix II: Comparisons of Demographic and Socioeconomic Characteristics of
Counties with Different TANF Characteristics

To determine how counties with different TANF caseload characteristics
compared, we put counties into four groups and looked at the demographic
and socioeconomic characteristics of each group. Table 1 shows the
characteristics of groups of counties with different proportions of the
population receiving TANF. Table 2 shows the characteristics of groups of
counties with different degrees of TANF caseload change from 1997 to 2003.

    Table 1: Comparison of Characteristics of Rural Counties with Different
         Proportions of Their Population on TANF County characteristics

                                                      Average    Average            
                                                   percentage percentage            
  Rural                                            of                 of            
 counties                                          families                         
 grouped                                           headed by  population               Average 
according                                  Average     single    with no    Average            
    to                                                                              percentage
the                  Average Average               mothers       high             change in 
proportion                              percentage                       percentage 
 of their       Average poverty  median    African       with     school  change in  number of 
population unemployment    rate income    American children   diploma in  caseload,        all 
                                in                 in                                families, 
receiving  rate in 2002 in 2000    2000    in 2000       2000       2000  1997-2003  1990-2000 
TANF                                                                             
  Lowest                                                                            
proportion          4.8    11.6 $35,300        2.0        6.4       19.3      -51.3 
2nd lowest                                                                          
proportion          5.6    12.8 $34,300        5.2        7.7       22.5      -35.3 
2nd                                                                              
 highest                                                                            
proportion          6.4    14.8 $32,700        9.5        9.1       25.3      -29.9 
 Highest                                                                            
proportion          7.8    19.6 $29,300       15.4       11.5       29.9      -21.0 

Source: GAO analysis of data provided by the Economic Research Service
derived from the Bureau of the Census and the Bureau of Labor Statistics,
in combination with data provided by 45 states with rural counties on the
average number of families receiving cash assistance under state TANF
programs during months of 2003.

Note: The counties are grouped into quarters, with the 25 percent of
counties with the lowest proportion of the population on TANF in the row
for "lowest proportion" and so forth. Each quarter includes 496 or 497
counties. Data for the District of Columbia, New Jersey, and Rhode Island
are not included because they do not have rural counties.

Appendix II: Comparisons of Demographic and Socioeconomic Characteristics
of Counties with Different TANF Characteristics

Table 2: Comparison of Characteristics of Rural Counties with Different Degrees
           of TANF Caseload Change, 1997-2003 County characteristics

Average Average Rural percentage percentage counties Average of families
of grouped percentage headed by population according to Average change in
single with no Average degree of change in Average number of Average
mothers high percentage caseload Average unemployment number of all median
with school change in change from unemployment rate, families in families,
income in children in diploma in caseload, 1997 to 2003 rate in 2002
1997-2002 2000 1990-2000 2000 2000 2000 1997-2003

Greatest
decrease 5.9 0.04 6,113 3.7 $32,400 8.2 23.5 -72.9

2nd greatest
decrease 6.5 -0.03 6,665 6.0 $31,600 9.2 26.0 -50.6

3rd greatest
decrease 6.0 0.04 6,034 5.6 $32,400 9.0 24.8 -33.2

Increase and
least decrease 5.6 0.41 5,673 6.7 $34,600 7.9 22.9

Source: GAO analysis of data provided by the Economic Research Service
derived from the Bureau of the Census and the Bureau of Labor Statistics,
in combination with data provided by 34 states with rural counties on the
average number of families receiving cash assistance under state TANF
programs during the years 1997 through 2003.

Note: The counties are grouped into quarters, with the 25 percent of
counties with the most caseload decrease in the row for "greatest
decrease" and so forth. Each quarter includes 432 or 433 counties.

                   Appendix III: TANF Caseload Data by State

                                                    CY 2003 TANF  Percentage  
                                        Percentage  caseload as     change    
                                                         a       
                 Average    Percentage   change in   percentage  in number of 
                 monthly        of         TANF          of               all 
                   TANF        TANF      caseload    number of    families,   
               caseload in   caseload                   all      
                 CY 2003    in CY 2003      CY      families in   1990-2000   
                                         1997-2003      2000     
               Urban Rural  Urban Rural Urban Rural Urban Rural   Urban Rural 
     Alabama   13,628 5,741   70.4 29.6                  1.6 1.6      9.3 9.8 
     Alaska     3,620 1,674   68.4 31.6                  3.6 3.2     14.5 9.6 
    Arkansas    6,120 4,859   55.7 44.3                  1.5 1.5     16.3 6.1 
    aArizona        .                                            
California    466,980       97.6 2.4 -39.2 -41.2      6.1 5.5      9.8 6.8 
                  11,340                                         
    bColorado  12,561 2,313   84.5 15.6 -40.6 -32.8      1.4 1.5    26.0 25.2 
Connecticut 21,131 1,158    94.8 5.2                  2.6 1.5      0.8 3.3 

c

                                    Delaware

    District of                                                          
     Columbiad     17,071    0     100.0  0.0  -27.2       15.0     -7.6 
      Florida      55,663  4,460    92.6  7.4  -61.4 -62.0  1.4 1.6 18.8 21.1 
      Georgia      43,579 14,848    74.6 25.4  -40.5 -42.8  2.6 3.4 24.7 14.1 
      Hawaiie       9,190  4,400    67.6 32.4  -39.4 -44.1  4.5 5.4  3.0 21.8 
       Idaho        1,151   595     65.9 34.1  -24.0 -35.6  0.6 0.5 33.5 16.0 
      Illinois     36,367  3,413    91.4  8.6  -79.5 -81.5  1.4 0.8  6.6 -0.9 
      Indiana      45,214  7,832    85.2 14.8   24.7 30.4   3.7 2.1  8.5  4.7 
        Iowa       11,398  8,560    57.1 42.9  -28.8 -27.6  2.9 2.3  7.7 -1.4 
       Kansas       9,836  5,303    65.0 35.0  -19.2 -15.3  2.3 1.9 10.9 -1.8 
      Kentucky     15,089 16,883    47.2 52.8  -42.5 -52.6  2.5 3.4  9.4  6.6 
     Louisiana     16,578  6,804    70.9 29.1  -55.0 -57.0  1.9 2.3  6.0  3.2 
       Maine        6,775  5,443    55.5 44.6  -24.7 -29.5  3.5 3.7  4.4  1.2 
      Maryland     27,780  1,041    96.4  3.6  -53.3 -45.3  2.2 1.4  8.0 12.2 
Massachusetts   44,773    8     100.0  0.0               2.9 0.1  3.3 33.1 
      Michigan     65,357  7,988    89.1 10.9  -51.8 -49.5  3.2 1.7  3.6  9.6 
     Minnesotaf    34,238 11,379    75.1 25.0               3.9 3.1 12.1  5.9 
    Mississippi     6,285 13,482    31.8 68.2  -39.4 -43.4  2.0 3.1 15.6  6.4 
      Missouri     32,742 12,174    72.9 27.1  -34.4 -21.1  3.1 2.9  7.0  7.6 
      Montanag      1,911  4,252    31.0 69.0  -32.5 -31.0  2.3 2.7  8.8 12.4 
      Nebraska      8,200  3,916    67.7 32.3   -1.6 -26.5  3.5 1.9 10.9  0.8 
      hNevada      11,267   914     92.5  7.5    5.3 -19.8  2.6 1.5 63.4 39.2 
        New                                                              
     Hampshire      3,262  2,422    57.4 42.6  -23.2 -17.2  1.6 2.0 10.4  9.0 
     New Jersey    41,599    0     100.0  0.0  -57.5        1.9      5.7 

                   Appendix III: TANF Caseload Data by State

                                    Wyoming
                                       m
                  62 106 36.9 63.1 -91.8 -92.7 0.2 0.1 6.6 8.2
     CY                           caseload         Average Percentage change percentage     in    TANF     TANF            number             CY   in     CY     families            Urban Urban Urban Urban Urban  New   10,716 65.1  3.7 21.8 New  180,519 95.7 -49.3 4.3  2.8  North   27,366 67.5 -54.7 1.9 20.9 North  1,040 31.7 -11.0 1.5  8.1      75,104 86.6 -49.8 3.1 2.4           10,060 68.2 -50.9 1.8 9.3        13,106 74.0 -15.0 2.0 18.1              78,718 90.5  2.9  0.6 Rhode  14,136 100.0                South   12,803 65.0 -35.9 1.6 15.0 South    637 22.9 -45.7 0.8 15.1           57,664 80.6 14.3 5.2 14.3        116,857 84.7 -36.9 2.6 21.9      8,173 86.5 -15.0 1.7 30.3         1,574 31.9 -31.5 3.2 12.4          25,481 80.1 -39.0 1.7 14.1                   85.4 -37.2 3.6 17.6 
    2003 Percentage    Percentage   as a   change  monthly     of       in       of     number  caseload caseload caseload of all families,  2003  CY  1997-2003 in 2000  1990-2000  Rural Rural Rural Rural Rural Mexico 5,744  34.9  3.3 12.4 York  8,093   4.3 -49.8 2.0 -1.0 Carolina 13,198 32.5 -63.5 1.9 13.4 Dakota 2,241 68.3 -18.5 2.3 -7.0 Ohio 11,582 13.4 -55.3 1.9 3.7 iOklahoma 4,695  31.8 -61.8 1.3 2.7 Oregon 4,605  26.0 -36.1 2.1  9.5 Pennsylvania 8,308   9.6  1.6 3.2. Island   0        0 -25.1 5.3 1.8 Carolina 6,895  35.0 -35.5 2.5 13.6 Dakota 2,141 77.1 -40.7 1.9  1.3 Tennessee 13,897 19.4  3.4 3.1 13.6 Texasj 21,183  15.4 -38.4 2.8  7.9 Utah 1,275 13.5 -48.1 1.9 24.3 Vermont 3,365 68.1 -38.7 3.1  6.5 Virginia 6,333  19.9 -27.6 2.1  6.2            46,685 14.6 -33.9 4.1 16.6 
    TANF                                                               TANF             of all     in                                             2003                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           Washington 7,985                 

West Virginiak 7,064 8,610 45.1 54.9 -53.9 -51.3 2.6 3.7 2.0 -1.8

Wisconsinl

Source: GAO analysis of data provided by the Economic Research Service
derived from the Bureau of the Census and the Bureau of Labor Statistics,
in combination with data provided by 48 states on the average number of
families receiving cash assistance under state TANF programs in 2003.

Note: CY = calendar year. Unless otherwise noted, caseload data include
families receiving monthly cash assistance under state TANF programs and
under programs funded with state maintenance-ofeffort dollars, if the
state has such a program.

aWe did not obtain data from Arizona.

bColorado data include families receiving diversion payments, as well as
families receiving monthly cash assistance.

cWe did not obtain data from Delaware.

dDistrict of Columbia caseload data were obtained from ACF.

eHawaii data for 1997 and 1998 are for state fiscal year.

fMinnesota data include some families (about 10 percent of the total
caseload) who are no longer receiving cash assistance but are receiving
federally funded food assistance. According to a Minnesota official,
Minnesota has integrated food assistance into its welfare program, and
some families in the program who have begun working are no longer eligible
for cash payments but are eligible for food assistance.

Appendix III: TANF Caseload Data by State

gMontana data are for state fiscal year.

hNevada data are for state fiscal year. iOklahoma data are for state
fiscal year. jTexas data are for state fiscal year.

kWest Virginia data are for state fiscal year.

lWe did not obtain reliable data from Wisconsin.

mWyoming data for two counties, Northern Arapaho and East Shoshone, are
not included because changes in caseload over the period would largely be
attributable to movement from state-to tribalrun programs rather than
participants moving off TANF.

Appendix IV: Comments from the Department of Health and Human Services

Appendix IV: Comments from the Department of Health and Human Services

Appendix IV: Comments from the Department of Health and Human Services

Appendix V: GAO Contacts and Staff Acknowledgments

GAO Contacts 	Clarita Mrena, (202) 512-3022 Kathy Peyman, (202) 512-9536

Staff In addition to those named above, Kenneth Adams, Tiffany Boiman, Amy
Buck, Cindy Decker, Lise Levie, Angela Miles, Jerry Sandau, and Jay Smale
Acknowledgments made key contributions to this report.

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Related GAO Products

Welfare Reform: Information on TANF Balances. GAO-03-1094. Washington,
D.C.: September 8, 2003.

Welfare Reform: Information on Changing Labor Market and State Fiscal
Conditions. GAO-03-977. Washington, D.C.: July 15, 2003.

Transportation-Disadvantaged Populations: Some Coordination Efforts Among
Programs Providing Transportation Services, but Obstacles Persist.
GAO-03-697. Washington, D.C.: June 30, 2003.

Child Care: Recent State Policy Changes Affecting the Availability of
Assistance for Low-Income Families. GAO-03-588. Washington, D.C.: May 5,
2003.

Welfare Reform: Job Access Program Improves Local Service Coordination,
but Evaluation Should be Completed. GAO-03-204. Washington, D.C.: December
6, 2002.

Child Care: States Exercise Flexibility in Setting Reimbursement Rates and
Providing Access for Low-Income Children. GAO-02-894. Washington, D.C.:
September 18, 2002.

Welfare Reform: With TANF Flexibility, States Vary in How They Implement
Work Requirements and Time Limits. GAO-02-770. Washington, D.C.: July 5,
2002.

Workforce Investment Act: States and Localities Increasingly Coordinate
Services for TANF Clients, but Better Information Needed on Effective
Approaches. GAO-02-696. Washington, D.C.: July 3, 2002.

Welfare Reform: States Provide TANF-Funded Work Support Services to Many
Low-Income Families Who Do Not Receive Cash Assistance. GAO-02-615T.
Washington, D.C.: April 10, 2002.

Welfare Reform: States Provide TANF-Funded Services to Many Low-Income
Families Who Do Not Receive Cash Assistance. GAO-02-564. Washington, D.C.:
April 5, 2002.

Human Services Integration: Results of a GAO Cosponsored Conference on
Modernizing Information Systems. GAO-02-121. Washington, D.C.: January 31,
2002.

Related GAO Products

Means-Tested Programs: Determining Financial Eligibility Is Cumbersome and
Can Be Simplified. GAO-02-58. Washington, D.C.: November 2, 2001.

Welfare Reform: Challenges in Maintaining a Federal-State Fiscal
Partnership. GAO-01-828. Washington, D.C.: August 10, 2001.

Welfare Reform: Moving Hard-to-Employ Recipients into the Workforce.
GAO-01-368. Washington, D.C.: March 15, 2001.

Welfare Reform: Improving State Automated Systems Requires Coordinated
Federal Effort. GAO/HEHS-00-48. Washington, D.C.: April 27, 2000.

Domestic Violence: Prevalence and Implications for Employment among
Welfare Recipients. GAO/HEHS-99-12. Washington, D.C.: November 24, 1998.

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