Welfare Reform: More Information Needed to Assess Promising	 
Strategies to Increase Parents' Incomes (02-DEC-05, GAO-06-108). 
                                                                 
Following major welfare reform in 1996, the number of families	 
receiving cash assistance was cut in half to 2 million. While	 
many former recipients now rely more on their earnings, they	 
often work at low-wage jobs with limited benefits and advancement
opportunities. To better understand how to help these individuals
and their families attain economic self-sufficiency, GAO is	 
reporting on (1) strategies designed to increase income for TANF 
recipients through employment; (2) the key factors related to	 
implementing and operating such strategies; and (3) actions the  
Department of Health and Human Services (HHS) has taken to	 
facilitate the use of these strategies. GAO consulted experts to 
gather information about promising strategies and visited 26	 
programs.							 
-------------------------Indexing Terms------------------------- 
REPORTNUM:   GAO-06-108 					        
    ACCNO:   A42519						        
  TITLE:     Welfare Reform: More Information Needed to Assess	      
Promising Strategies to Increase Parents' Incomes		 
     DATE:   12/02/2005 
  SUBJECT:   Disadvantaged persons				 
	     Employment assistance programs			 
	     Locally administered programs			 
	     Program evaluation 				 
	     Public assistance programs 			 
	     Strategic planning 				 
	     Vocational education				 
	     Welfare benefits					 
	     Welfare recipients 				 
	     Workfare						 
	     Temporary Assistance for Needy Families		 
	     Program						 
                                                                 

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GAO-06-108

     

     * Results in Brief
     * Background
     * Programs Used Four Strategies Designed to Help TANF Clients
          * Training Strategies Fit Unique Client Needs and Local Econom
               * Training Programs Vary in Terms of Time Commitment
               * Training Programs Cater to the Needs of Differing Target Pop
               * Programs Use Training Approaches Relevant to Local Job Marke
          * Post-Secondary Education Strategies Aim to Leverage College
          * Microenterprise Strategies Can Give TANF Recipients Tools to
          * Asset-building Strategies Emphasize Savings and Financial Ed
     * A Network of Non-Profits, TANF Agencies, Employers, and Comm
          * Collaboration Between Local Nonprofits and TANF Agencies Is
          * Partnerships with Local Employers and Community Colleges Yie
     * HHS Is Supporting Research, Providing Technical Assistance,
          * HHS Conducts and Shares Research on Employment and Asset-bui
          * HHS Provides Targeted Grants That Encourage Use of Strategie
          * Use of Strategies Facilitated through Technical Assistance P
          * Other Federal Agencies also Play a Role Encouraging Use of S
     * Conclusions
     * Recommendations for Executive Action
     * Agency Comments and Our Evaluation
          * California
          * Illinois
          * Kentucky
          * Maryland
          * Montana
          * Pennsylvania
     * GAO Contact
     * Acknowledgments
     * GAO's Mission
     * Obtaining Copies of GAO Reports and Testimony
          * Order by Mail or Phone
     * To Report Fraud, Waste, and Abuse in Federal Programs
     * Congressional Relations
     * Public Affairs

Report to Congressional Requesters

United States Government Accountability Office

GAO

December 2005

WELFARE REFORM

More Information Needed to Assess Promising Strategies to Increase
Parents' Incomes

Welfare Reform Welfare Reform Welfare Reform Welfare Reform Welfare Reform
Welfare Reform Welfare Reform Welfare Reform Welfare Reform Welfare Reform
Welfare Reform Welfare Reform Welfare Reform Welfare Reform Welfare Reform
Welfare Reform Welfare Reform Welfare Reform Welfare Reform Welfare Reform
Welfare Reform Welfare Reform Welfare Reform Welfare Reform Welfare Reform
Welfare Reform Welfare Reform Welfare Reform Welfare Reform Welfare Reform
Welfare Reform Welfare Reform Welfare Reform Welfare Reform Welfare Reform
Welfare Reform Welfare Reform Welfare Reform Welfare Reform Welfare Reform
Welfare Reform Welfare Reform Welfare Reform Welfare Reform Welfare Reform
Welfare Reform Welfare Reform Welfare Reform Welfare Reform Welfare Reform
Welfare Reform Welfare Reform Welfare Reform Welfare Reform Welfare Reform
Welfare Reform Welfare Reform Welfare Reform

GAO-06-108

Contents

Letter 1

Results in Brief 3
Background 6
Programs Used Four Strategies Designed to Help TANF Clients Move into
Higher Wage Employment or Build Financial Assets 10
A Network of Non-Profits, TANF Agencies, Employers, and Community Colleges
Is Key to Operating Programs 25
HHS Is Supporting Research, Providing Technical Assistance, and Sponsoring
Targeted Grant Funding, but Additional Research and Technical Assistance
Are Needed 30
Conclusions 37
Recommendations for Executive Action 39
Agency Comments and Our Evaluation 39
Appendix I List of Experts Interviewed 42
Appendix II Program Contact Information 43
Appendix III Comments from the Department of Health and Human Services 47
Appendix IV GAO Contact and Staff Acknowledgments 55
Related GAO Products 56

Table

Table 1: Selected Programs and Strategies Used 11

Figures

Figure 1: A Student in the Kentucky River Foothills R.O.U.T.E. Training
Program in Richmond, Kentucky Trains for a Commercial Truck Drivers'
License 14
Figure 2: Participants in the District 1199C Training and Upgrading Fund
Career Ladder Program Demonstrate Features of the Program's Nurse's Aide
Training Facility 16
Figure 3: Vendors Sell Produce and Other Goods in the Career Transitions
Farmers' Market in Belgrade, Montana, Where Microenterprise Students Can
Test Their Business Ideas 23
Figure 4: Ways in Which TANF Clients Were Connected to Programs 26

Abbreviations

ACF Administration for Children and Families

AFI Assets for Independence

CET Center for Employment Training

DOT Department of Transportation

EITC Earned Income Tax Credit

ESL English as a second language

HHS U.S. Department of Health and Human Services

HUD U.S. Department of Housing and Urban Development

IDA Individual Development Accounts

IRS Internal Revenue Service

JOLI Job Opportunities for Low-Income Individuals

PRWORA Personal Responsibility and Work Opportunity Reconciliation Act of
1996

TANF Temporary Assistance for Needy Families

USDA U.S. Department of Agriculture

WORC Women's Opportunities Resource Center

WIA Workforce Investment Act

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United States Government Accountability Office

Washington, DC 20548

December 2, 2005

The Honorable Max Baucus Ranking Minority Member Committee on Finance
United States Senate

The Honorable Edward Kennedy Ranking Minority Member Committee on Health,
Education, Labor, and Pensions United States Senate

The Honorable James McDermott Ranking Minority Member Subcommittee on
Human Resources Committee on Ways and Means House of Representatives

The Honorable Benjamin Cardin House of Representatives

Welfare reform legislation of 1996 shifted the focus of the nation's
welfare program from issuing benefit checks to moving families to economic
independence. The centerpiece of this legislation is the Temporary
Assistance for Needy Families (TANF) block grant, under which states
receive federal funds to design and operate their own welfare programs
within federal guidelines. Since states have implemented welfare reforms,
they have spent almost $200 billion in federal and state TANF funds to
meet the broad goals of the law, including ending the dependence of
low-income parents on government benefits through job preparation, work,
and marriage. In addition to TANF funds, state welfare agencies draw on a
vast array of federal, state, and community programs and services to
assist TANF recipients' work efforts, including employment, training, and
education programs overseen by the Departments of Labor and Education.
While many entities at all levels of government are involved in providing
support and services to TANF recipients, the Department of Health and
Human Services (HHS) is responsible for overseeing welfare reform at the
federal level.

Since 1996, the number of families receiving cash assistance declined from
4.4 million to about 2 million in 2004, as the number of low-income
parents working increased. While many former welfare recipients now rely
more on their own earnings than on welfare, they often work at low-wage
jobs, sometimes with limited benefits and few opportunities for
advancement. Some former recipients return to the welfare rolls when they
leave or lose jobs or struggle to keep child care, transportation, health,
and other work supports in place.

As Congress considers reauthorization of welfare reform, much attention
has focused on helping welfare families transition to more stable and
higher-paying employment and ending welfare dependence.1 Many policymakers
are concerned that TANF programs nationwide place too much emphasis on
moving needy parents quickly into any available employment rather than
developing strategies for helping them find stable and higher-paying jobs.
As agreed with your offices, we are providing information on: (1) examples
of strategies being used to help TANF recipients increase their incomes
through employment; (2) the key factors related to implementing and
operating such strategies; and (3) the actions HHS has taken to facilitate
the use of these strategies.

Current federal and state welfare reforms are built upon a considerable
research base showing that welfare-to-work programs can succeed in moving
welfare recipients into jobs and reduce their reliance on public
assistance. Much less is known, however, about how welfare-to-work
programs can increase participants' earnings, and ultimately household
incomes. To address the first two questions, we identified through
research and referrals officials with expertise in welfare-to-work
strategies and who represented diverse perspectives. For a complete list
of officials interviewed, see appendix I. Once identified, we interviewed
these experts to elicit their suggestions about promising strategies for
increasing income for TANF recipients and examples of these strategies in
operation. Based on these interviews, we identified a list of 127 programs
operating these strategies for TANF recipients. These programs were
typically administered by non- or for-profit organizations or other
entities such as community colleges or unions and operated separately from
the TANF agencies. Generally, TANF agencies administer core TANF program
activities, such as determining eligibility for and providing income
support; assessing client needs and employability; referring clients to
services; and monitoring client activities; in some cases the TANF agency
also directly provides employment-related services.

1The funding authority for the TANF block grant was originally due to
expire in September 2002. Since that time, Congress has granted several
temporary extensions as it has continued to consider reauthorization
proposals.

Of the 127 programs identified by experts, we selected 26 for site visits,
based on several criteria, including coverage of strategies that could
address diverse client skill levels and local economic conditions;
geographic coverage; and coverage of diverse state TANF policies. During
these site visits, we interviewed program administrators about how their
programs operated, including the factors that facilitated and hindered
their respective missions. We typically toured facilities and in some
cases, we attended training sessions and spoke with program participants.
We also collected relevant documents and any program evaluations that were
available.

We also conducted interviews with the welfare agency in the local area, as
well as pertinent state TANF officials. To address our third objective, we
collected and reviewed relevant documents and interviewed HHS officials in
headquarters and regional offices to identify relevant technical
assistance, information sharing, and other research activities. We also
spoke with officials at the Departments of Labor and Education where
appropriate. We conducted our work in accordance with generally accepted
government auditing standards from September 2004 to November 2005.

                                Results in Brief

Based on our interviews with experts and visits to programs, we identified
four strategies that aimed to increase incomes for TANF
recipients-training, post-secondary education, self-employment, and
financial asset building. Training strategies varied considerably in terms
of time commitment, target population, and needs of the local job market.
For instance, some programs featured short-term commitments, such as
5-week certified nurse's assistant training, designed to give participants
a set of skills to move quickly into jobs yet earn above minimum wages.
Other training programs prepared clients for longer-term commitments, such
as 2-year apprenticeship programs in the trades. Often, these programs
targeted a specific industry or skill relevant to the local economy, and
sometimes delineated career paths with formal milestones, making it
possible for a client to gain skills and advance at intervals, for
example, from certified nurse's aid to licensed practicing nurse to
registered nurse. Some programs incorporated a post-secondary education
strategy, using a 2-year or 4-year college degree to position clients for
higher-wage, often professional jobs. We found microenterprise or
self-employment strategies generally in sparsely populated areas lacking a
strong business presence or sufficient entry-level job opportunities.
These programs usually included financial literacy and business plan
development components and sometimes provided clients with seed money to
start a business. Finally, asset building strategies helped clients save
and invest money through vehicles like individual development accounts,
assuming that personal savings play an important role in helping TANF
clients pursue career goals and support their families. Overall, the
programs we visited often employed a combination of strategies to help
clients increase income and personal savings, although we observed great
variation in program structure and design. This variation made it possible
for programs to accommodate client and situational realities involving
diverse skill backgrounds, work histories, and economic conditions.

We found that a broad network of support-involving local non-profits,
state and local TANF agencies, employers, and community colleges-is key to
operating these strategies to help TANF recipients find jobs and improve
their financial security. Most of the programs we visited were run by
non-profit organizations that provided services to TANF clients either
under contract with the state or local welfare agency or using a mix of
public and private funding sources. Some programs told us they chose to
use other funding sources because of concerns that the work focus of the
current welfare system was a barrier to offering education and training
options. State and local TANF offices, for their part, sometimes
established policies to encourage certain strategies, even though those
priorities are not emphasized in the federal legislation. For example, one
state implemented policy provisions and provided additional funding to
allow post-secondary education as a component of its TANF program. In
addition to core services, providing a range of supplemental and support
services for TANF clients is critical to operating these strategies. Local
nonprofits and TANF agencies either directly provided or helped link
clients to services such as child care, housing, on-the-job support, and
transportation. As part of the broader network, local nonprofits and TANF
offices sometimes forged links with employers and community colleges to
leverage additional expertise and support for their clients, including
training curricula, career ladders, and work opportunities.

HHS is supporting these strategies through research, technical assistance,
and targeted grant funding, but more efforts are needed to determine the
effectiveness of such strategies and to assist states and localities in
incorporating them into their TANF programs. HHS currently has several
major research projects underway, such as the Employment Retention and
Advancement project, that address issues related to helping TANF clients
raise their incomes. HHS has also taken several steps, including hosting
an annual welfare research conference, to share research-related
information. The agency also provides technical assistance through the
Welfare Peer Technical Assistance Network and HHS's 10 regional offices.
The agency also provides targeted grants such as Job Opportunities for
Low-Income Individuals. Efforts by other federal agencies, such as the
Departments of Labor and Education, also support some of the strategies
discussed in this report. While HHS has research efforts under way that
will provide important information, more needs to be known about what
specific strategies are most effective in raising TANF recipients'
earnings. In addition, while several units and offices within HHS have
taken steps to disseminate research findings and help TANF programs
implement promising strategies, there may be more opportunities to reach
the wide range of state and local welfare agencies and programs involved
in welfare reform. We also identified some confusion about whether and how
to incorporate strategies such as education and training for TANF
recipients within a work-focused welfare system.

To help ensure that the federal government considers research on these
promising strategies and better informs welfare agencies and programs
about how they might incorporate such strategies for TANF recipients, we
recommend that the Secretary of HHS:

           1. Review its current research agenda and identify opportunities
           to conduct and promote additional research on increasing earnings
           capacity among low-income parents.
           2. Review existing research dissemination and technical assistance
           efforts across the relevant units and agencies to better ensure a
           comprehensive process for distributing information and
           implementation assistance to the wide range of program
           administrators and programs involved in welfare reform.
           3. Seek out additional opportunities to work with the Secretaries
           of Labor and Education to jointly conduct and promote research and
           distribute information and implementation assistance related to
           enhancing skills and earnings capacity among low-income parents.

In commenting on a draft of this report, HHS said that the recommendations
were not warranted given its existing efforts. While we acknowledge HHS'
ongoing efforts, we continue to think additional efforts are warranted.

                                   Background

The Personal Responsibility and Work Opportunity Reconciliation Act of
1996 (PRWORA) represented a significant departure from previous welfare
policies in place for more than 60 years. Previously, state and local
welfare agencies focused mainly on issuing monthly welfare checks to
eligible families. In contrast, the revised welfare legislation
establishes broad goals for state TANF programs that go beyond income
support payments, including ending the dependence of needy parents on
government benefits by promoting job preparation, work, and marriage;
preventing and reducing out-of-wedlock pregnancies; and encouraging the
formation and maintenance of two-parent families. To receive its TANF
block grant funds, each state must contribute its own funds up to a
specified level. The amount of TANF funds available to states each year is
capped, unlike the previous welfare program under which federal and state
welfare payments increased each year as welfare rolls increased.

Along with new goals and funding structure, the law established work
requirements and time limits considered key to changing the nature of
welfare. States are to involve increasing percentages of their adult TANF
recipients in certain activities for a required number of hours each week
or face financial penalties. These work requirements limited some types of
education and training from counting toward the work requirement. To
emphasize the temporary nature of assistance, states must restrict most
families to a lifetime limit of 60 months of cash assistance.

Within this federal framework, TANF provides states considerable latitude
to design and implement programs to meet TANF goals while responding to
states' unique economic conditions, client needs, and policy priorities.
Each state determines what aid and services to provide, sets eligibility
requirements for these services, and determines what service delivery
approaches to use, including reliance on contractors. Even within the
federal work requirements and time limits, some provisions exist that
allow states some flexibility or adjustments to stated federal
requirements. More specifically:

           1. States may allow and support TANF recipients in any activity of
           the state's choosing, although they can only count
           federally-specified activities toward the federal work
           requirement. States have some additional flexibility because they
           have significant discretion in defining what activities fit within
           these federally-specified categories, as we found in our recent
           report.2 
           2. A provision in the law, called the caseload reduction credit,
           lowers the work requirement standard a state must meet if its TANF
           cash assistance caseload declines. While the work participation
           rate standard rose as high as 50 percent in the law, in practice
           states have faced much lower standards due to this credit.
           3. A state may exclude a family from work requirements and time
           limits by providing cash assistance with the state's own funds
           rather than federal TANF funds.
           4. Work requirements and time limits only apply to families
           receiving ongoing monthly cash assistance, allowing states to
           provide other services to non-welfare families, such as providing
           low-income working families with child care assistance.

Due to the importance of state flexibility under TANF, the welfare
legislation limited HHS' authority to regulate state TANF programs. Also,
HHS staff available to implement TANF was substantially reduced. However,
HHS retains central oversight authority over certain aspects of state TANF
programs, such as oversight of federal work requirements and time limits
among other program elements. In addition, it has authority to conduct
research and provide technical assistance to states, although its research
role has changed significantly under TANF. Under the previous welfare
program, HHS required states that applied for and received waivers to
federal program rules to have an independent organization evaluate its
program change, supported by HHS funding. While some of these waiver
evaluations were continued under TANF, HHS no longer has authority to
require evaluations of state programs, although it still has some
resources available for research.

In implementing TANF, states focused more than ever before on helping
welfare recipients and other low-income parents find jobs. Many states
implemented work-focused programs that stressed moving parents quickly
into jobs; restructured benefit payments to allow more parents to combine
welfare and work; expanded support services, particularly child care
subsidies; and took some steps to identify and address barriers to
employment. To provide services, TANF programs often turned to the
workforce development and educational systems that have traditionally
provided employment, training, and educational services and to other for-
and non-profit providers. As a result of this decentralized service model
and variation in the type and package of services that individuals are
provided through TANF and other programs, the per-person cost can vary
widely.

2GAO, Welfare Reform: HHS Should Exercise Oversight to Help Ensure TANF
Work Participation Is Measured Consistently across States, GAO-05-821
(Washington, D.C.: Aug. 19, 2005).

Cash welfare caseloads declined dramatically in the years immediately
following welfare reform and have continued to hold at about half their
pre-reform levels despite the recession of 2001. Experts attribute this
decline to several factors, including welfare reform, the economy, and
other policy changes, including expansion of the earned income tax credit
(EITC) that provides subsidies to low-income workers, as well as increased
federal spending for child care subsidies for low-income parents. Changes
in welfare spending over time reflect this shift away from cash assistance
to other services. Of the total federal and state TANF dollars spent in
fiscal year 1995, about 70 percent was for cash assistance payments, in
contrast to about 38 percent in fiscal year 2004. With the funds freed up
from reduced cash assistance caseloads, states have invested in work
preparation and other support services for welfare recipients and other
low-income families.3

This dramatic decline in cash assistance caseloads and other changes under
welfare reform have spurred interest in how former welfare recipients are
faring. Our work and other research shows that most of the parents leaving
welfare have found employment and some are now better off than they were
on welfare. However, many work in unstable, low-wage jobs with few
benefits and advancement opportunities. In these cases, even a common
occurrence such as a parent's need to stay home with a sick child can lead
to job loss and a return to welfare. While key government supports such as
the EITC, Medicaid, Food Stamps, and others can help these parents support
their families and lift them out of poverty, most parents are not earning
enough to be self supporting.

This raises important questions about whether welfare reform programs can
achieve better outcomes for their participants. The welfare reform
outcomes seen so far are in keeping with what is known about the
effectiveness of welfare-to-work programs. A considerable body of
research, much of it sponsored by HHS, suggests that welfare-to-work
programs can increase employment and reduce welfare receipt. This research
also shows that welfare-to-work programs that rely on a mixed
approach-with a strong work focus and some education and training as
needed-show the greatest earnings gains. Moreover, a mixed strategy
appears more effective than approaches that focused solely on education
and training or solely on job search, although an emphasis on job search
only was less costly. 4 At the same time, research shows that even the
most effective welfare-to-work programs tested so far increase employment
and earnings but do not typically increase household incomes. This is
because the increased income from earnings is offset by the loss of cash
welfare, food stamps, and other support services.

3It is important to note that cash assistance caseload data do not reflect
the many families who receive TANF-funded services.

Considerable questions still exist on how best to improve outcomes under
welfare reform. The existing research base does not yet provide answers
regarding how best to help parents successfully transition to more stable
and economically-sustaining employment. Some believe that incorporating
more in-depth or quality education and training into state TANF programs
could yield greater results, expressing concerns that states currently do
not sufficiently emphasize education and training in their TANF programs,
in part due to the current structure of TANF work requirements. To address
this, a Senate Finance Committee reauthorization proposal includes
provisions to allow and encourage states to provide additional education
and training opportunities in their TANF programs.

4For more information, see Lessons from the National Evaluation of
Welfare-to-Work Strategies. U.S. Department of Health and Human Services,
U.S. Department of Education, Washington, DC; Gayle Hamilton, MDRC, 2002.
Also see Report on a Meta-Analysis of Welfare-to-Work Programs, U.S.
Department of Health and Human Services, DC; David Greenberg and Andreas
Cebulla with Stacey Bouchet, June 2005.

  Programs Used Four Strategies Designed to Help TANF Clients Move into Higher
                   Wage Employment or Build Financial Assets

Based on our interviews with experts and our site visits, we identified
four strategies used to help TANF clients find well-paying jobs and
improve their financial condition: training, post-secondary education,
self-employment, and financial asset building. Within the training
strategies, some programs aim to help TANF clients find jobs quickly,
while others take a more long-term approach to prepare clients for highly
technical fields like nursing. Training programs also target specific
subgroups of clients, such as women or non-English speakers, or jobs in
high demand in the local economy. Programs using post-secondary education
strategies help clients get 2- or 4-year college degrees to position them
to compete for higher-wage, often professional jobs. Microenterprise, or
self-employment strategies, emphasize financial literacy and business plan
development and sometimes provide clients capital to start a business. In
contrast to the first three categories, asset building strategies focus on
building clients' financial reserves through savings accounts or
homeownership, relying on the assumption that personal savings play an
important role in helping TANF clients pursue career goals and support
their families. Many programs we visited used a combination of one or more
of the four strategies. While several programs served only TANF clients,
most programs served a broader population of low-income individuals in
general. Table 1 shows each program by the strategy used, population
targeted, and federal funding sources.

Table 1: Selected Programs and Strategies Used

                                               Strategies                               
                                       Post      Financial                  Low-Income             
                                       secondary asset     Microenterprise  Population  Sources of Federal
Location     Program          Training education building  development      Targeteda   Fundingb
California   Californians for    X         X         X            X         Individuals HUD        
             Family Economic                                                            
             Self-Sufficiency                                                           
             Center for     X                                              Individuals  Labor,     
             Employment                                                                 Education  
             Training                                                                              
             LIFETIME            X         X                               TANF Only    c          
             San Francisco  X    X         X                               Individuals  Labor      
             Works                                                                                 
             Street Tech    X    X                                         Individuals  Labor      
             Women's                       X              X                Women        HUD        
             Initiative for                                                                        
             Self                                                                                  
             Employment                                                                            
Illinois     Bethel              X                   X                      Individuals Labor      
             Employment and                                                             
             Training Center                                                            
             Chicago Women  X                                              Women        HHS        
             in Trades                                                                             
             Project Match  X    X                                         Individuals  c          
             The Cara       X              X                               Individuals  HHS, USDA  
             Program                                                                               
Kentucky     Bowling Green       X                                          Women       HHS, HUD   
             Housing                                                                    
             Authority Women                                                            
             in Construction                                                            
             Bowling Green       X         X              X                Individuals  HHS,       
             Technical                                                                  Education  
             College Ready                                                                         
             to Work                                                                               
             Program                                                                               
             Brighton       X                                              Individuals  Labor,     
             Center's                                                                   Education  
             Center for                                                                            
             Employment                                                                            
             Training                                                                              
             Kentucky River X                                              Individuals  HHS, Labor 
             Foothills                                                                             
             R.O.U.T.E.                                                                            
             Training                                                                              
             Program                                                                               
Maryland     Community                     X                                TANF Only   Labor      
             College of                                                                 
             Baltimore County                                                           
             Continuing                                                                 
             Education                                                                  
             Program                                                                    
             The Johns      X    X                                         Individuals  Labor,     
             Hopkins Skills                                                             Education  
             Enhancement                                                                           
             Program                                                                               
Montana      Career Training     X         X         X            X         Women       HHS, Labor, Education,
             Institute                                                                  HUD, USDA  
             Career         X    X                        X                Individuals  Labor,     
             Transitions                                                                Education, 
                                                                                        USDA       
             Montana PEAKS, X    X                        X                Individuals  HHS,       
             Inc.                                                                       Education, 
                                                                                        HUD        
             Women's        X    X         X                               Women        HUD        
             Opportunity                                                                           
             and Resource                                                                          
             Development,                                                                          
             Inc.                                                                                  
Pennsylvania AchieveAbility                X         X                      Families    HUD        
             Campaign for                  X                               Families     c          
             Working                                                                               
             Families                                                                              
             District 1199C X    X                                         Individuals  HHS,       
             Training and                                                               Labor,     
             Upgrading Fund                                                             Education  
             PathWaysPA     X              X                               Families     HHS, Labor 
             Transitional   X    X                                         TANF Only    HHS, Labor 
             Work                                                                                  
             Corporation                                                                           
             Women's                       X              X                Women,       HHS        
             Opportunities                                                 Minorities              
             Resource                                                                              
             Center (WORC)                                                                         

Source: GAO.

Note: For programs' contact information, see appendix II.

aLow-income individuals include TANF clients.

bWhile some programs did not directly receive federal funding from HHS,
often the participants in their programs were receiving cash assistance
and support services from TANF such as child care subsidies and
transportation assistance among others.

cNo federal funding cited by program officials.

Training Strategies Fit Unique Client Needs and Local Economic Conditions

Programs using training strategies to help TANF clients find jobs often
vary their services to meet clients' needs, whether by providing short- or
long-term training courses, targeting specific subgroups of TANF
participants, or focusing training to prepare participants for jobs in
high demand in the local economy. Specifically, we observed that training
strategies vary considerably in terms of:

           o  time commitment,
           o  target population, and
           o  job market relevance.

  Training Programs Vary in Terms of Time Commitment

At least two programs offer clients short-term (12 weeks or less) training
courses designed to give them the skills to move quickly into jobs paying
more than the minimum wage. For example, the Kentucky River Foothills
R.O.U.T.E. (Road Ready Operators Understanding Transportation Excellence)
Training Program in Richmond, Kentucky, trains low-income individuals for
a Class B Commercial Drivers License. Once clients complete the 8-week
truck drivers' program, they are eligible to obtain jobs driving small
trucks and buses at wages starting at $9 per hour. The Montana PEAKS
program, operated by a nonprofit organization in Flathead County, Montana,
is another example of a short-term, results oriented program. It serves as
one of two job services providers under contract to the county TANF
agency. In a minimum of 12 weeks, the Montana PEAKS program trains its
clients for entry-level jobs in construction. Many Montana PEAKS graduates
obtain jobs as construction site flaggers. Graduates of the program have
earned wages of up to $20 per hour.

Figure 1: A Student in the Kentucky River Foothills R.O.U.T.E. Training
Program in Richmond, Kentucky Trains for a Commercial Truck Drivers'
License

While short-term training allows participants to move into higher-paying
jobs more quickly, program officials found that many clients also required
scheduling flexibility in order to successfully complete the training. To
accommodate this need, the Kentucky truck drivers' program conducts
training for participants in 1-week modules to allow the admission of
students on a rolling basis. Because modules were designed as "stand
alone" components, participants can start and stop the program at any time
without having to repeat the entire course.

Other training programs offer longer-term training (roughly 6 months or
more) to prepare clients for entry-level jobs in highly technical fields
with the potential for career advancement. Jobs in this category can
provide an entry point to a career ladder that could lead to jobs with
even higher wages. One example of this kind of incremental advancement
approach is the District 1199C Training and Upgrading Fund5 career ladder
program in Philadelphia, which trains TANF clients, union members, and
individuals from the community-at-large for careers in health care. TANF
clients referred by caseworkers and other students may come to the 1199C
career ladder program to participate in the organization's 4-month long
nurse's aide training program. Graduates of this program are often placed
into nurse's aide jobs paying wages that nationally had a median beginning
wage of $9.59 per hour in 2002. Another important aspect of the 1199C
career ladder program is its ability to accommodate clients who do not
immediately have the skills necessary to be successful in a nurse's aide
program. The program also admits participants who enroll first in an adult
basic education course, then graduate to the nurse's aide training and
finally matriculate into the Licensed Practical Nurse certificate program.
Participants also have the opportunity to apply for funding to complete
the Registered Nursing program with a school of nursing in the
Philadelphia area. According to the U.S. Bureau of Labor Statistics,
average wages for registered nurses range from $17.93 to $35.94 an hour.

5The District 1199C Training and Upgrading Fund was established in 1974 by
the National Union of Hospital and Healthcare employees, an affiliate of
the American State, County, and Municipal Employees (AFL-CIO).

Figure 2: Participants in the District 1199C Training and Upgrading Fund
Career Ladder Program Demonstrate Features of the Program's Nurse's Aide
Training Facility

Over the course of our site visits, we found that a number of individual
employers had structured their own internal career ladder programs. In
Baltimore, the Johns Hopkins Skills Enhancement Program, supported with a
grant from the Department of Labor,6 was designed to serve TANF clients
and other low-income individuals in the Baltimore area. The Skills
Enhancement Program places new employees, some of which are former TANF
clients referred from the Baltimore Department of Social Services, into
janitorial positions while being trained by the hospital to obtain
entry-level healthcare positions. According to one program official, one
participant in the Skills Enhancement Program entered the program in a
janitorial position earning $8.50 per hour. After completing phlebotomy 7
training sponsored by the hospital, the participant was promoted to a
clinical associate earning $12 per hour. The participant plans to enroll
in another program to become a registered nurse. Career ladders were also
evident in fields other than healthcare. In San Pablo, California, located
not far from the technology corridor of the San Francisco Bay area, the
Street Tech non-profit program provides training for clients to attain
entry level jobs as computer technicians earning $15 to $20 per hour.
Their Computer Apprenticeship Training/Microsoft Office User Specialist
program provides participants an introduction to the field and teaches
some general, basic computer skills. Graduates of this program may choose
to complete 6 months of additional training at Street Tech in order to
receive an A+ certification,8 and some have chosen to complete the
organization's Field Tech training to further enhance their skills and
increase their earning potential.

  Training Programs Cater to the Needs of Differing Target Populations

In recognition of their target population's diverse needs and
capabilities, programs often provide more than one type of
employment-related service either directly or through some type of
referral arrangement. For example, the Bethel Employment and Training
Center, a faith-based non-profit in Chicago, offers its TANF and other
low-income clients a diverse array of in-house and collegiate training
opportunities, such as helping clients pursue interests with a variety of
employers or seek self-employment. However, their offerings are not
limited to training alone. The organization also has teamed up with an
area bank to establish an individual development account (IDA) program
that matches client contributions 2-to-1 up to $1800. Likewise, the Career
Training Institute, a non-profit program that serves TANF and other
low-income clients in a 3-county area in Helena, Montana, delivers a
diverse roster of services. The program offers clients a multitude of
training opportunities, from construction and commercial driving to
clerical and accounting occupations. In addition, the Institute will also
refer clients to an IDA program for women interested in starting their own
businesses. An official from at least one program site suggested that
offering a variety of services may provide a natural incentive for clients
to stay in contact, making it easier for programs to track their progress.
For example, once a client completes job training and obtains work, he or
she may return later to open an IDA account or pursue other
post-employment services.

6The Department of Labor administered the federal Welfare-to-Work program,
a short-term 2-year program, that provided funding to help states and
localities meet their welfare reform objectives and the goals set forth
under PRWORA by providing federal resources above and beyond the TANF
block grant to move the least-employable TANF recipients and noncustodial
parents of TANF children into long-term unsubsidized employment.

7Phlebotomy is the practice of drawing blood.

8According to the Computing Technology Industry Association, A+ is an
international industry credential that validates the knowledge of computer
service technicians with the equivalent of 500 hours of hands-on
experience. Major hardware and software vendors, distributors, and
resellers accept A+ as the standard in foundation-level, vendor-neutral
certification for service technicians.

Some of the programs we visited help individuals with academic barriers or
other skill deficiencies by providing them with adult basic education and
life-skills training to prepare them for vocational coursework. For
example, the San Francisco Works program, a mostly privately-funded
non-profit in San Francisco, prepares TANF and other low-income clients
with sixth grade skill levels to participate in training for entry level
positions in biotechnology (e.g., lab technicians, media assistants,
etc.). Its On Ramp to Biotech program provides clients training in
language, lab science terminology, lab procedures, and documentation to
prepare them to complete a 24-month biotech certification program at a
community college.

The Brighton Center's Center for Employment Training program in Kentucky
works with applicants to help to remove a number of barriers to
employment. Through intensive case management, Center staff help clients
find services to address issues such as low self-esteem and provide
clients with skills and support systems to help them find and retain
employment. Likewise, the Transitional Work Corporation, a TANF service
provider under contact to the Philadelphia County Assistance Office, also
provides advisors to prepare clients who have limited education and have
been on TANF for more than 24 months.

To help clients with limited work experience successfully make the
transition to permanent employment, a number of programs help participants
understand what would be expected of them at the job site. For example,
The Cara Program requires participants to wear professional attire each
day and has mounted a time clock in the building's entryway, where
participants punch in and out each day. Similarly, the program site for
Street Tech in San Pablo, California resembles a corporate office, and
staff conduct their relationships according to corporate norms and
expectations. For instance, participants can be released from the program
or "fired" for not meeting expectations for good attendance. Street Tech
also places particular emphasis on the skills required for writing
resumes, setting up interviews, and writing follow up thank you notes. At
the Community College of Baltimore County, a TANF contractor with the
Baltimore Department of Social Services, staff prepare TANF clients for
their job search by providing coaching and conducting mock interviews.

While many of the programs we visited assisted individuals with limited
work experience, others require that individuals have more education or
better work habits. The Chicago Women in Trades program, a non-profit
which prepares TANF clients and other low-income women for various
apprenticeships in the construction field, such as pipefitting or
bricklaying, requires its participants to have a high school diploma or
GED, knowing that they would not be accepted into apprenticeship programs
without this credential. While the Street Tech training program accepts
individuals with limited work experience, it screens candidates to ensure
that they are well-suited to handle the challenges of the various computer
certification exams.

Some programs target specific subsets of the welfare or low-income
population, such as people who speak English as a second language (ESL) or
those with learning disabilities. The Center for Employment Training
(CET), a non-profit in San Jose, California, assesses all of its students
to determine if they require general training in English or English
language training in the context of the job function or vocation. For
example, certified nursing students at the San Jose CET are taught English
using medical terminology. Other programs focus on clients with learning
disabilities. For example, Career Transitions, a non-profit in Belgrade,
Montana, employs an instructor with a background in teaching with learning
disabilities to provide microenterprise training and other short-term
employment training. In addition, the ROUTE Training Program has designed
its commercial truck driving program to involve both experiential and
classroom learning in an effort to accommodate some participants' learning
disabilities. Program staff explained that this hands-on approach is
particularly effective for students with learning disabilities and others
who have not been successful in a traditional classroom environment.

Several programs target women, encouraging them to pursue nontraditional
employment in the trades or highway construction, although officials from
some programs noted the initial reluctance of TANF job-seekers to pursue
more lucrative careers in the trades outside of the often low wage service
professions. Officials from the Bowling Green Housing Authority in
Kentucky reported that clients who graduated from their Women in
Construction program earned starting wages of $10 to $12 per hour.
Flathead County, Montana, benefited from the growth of the building and
construction industry. The Montana PEAKS program capitalizes on the
growing building and construction industry, placing many women clients at
project sites in Glacier National Park, the recipient of $100 million in
recent construction contracts. To maximize wages in the trades, Chicago
Women in Trades encourages its TANF clients to pursue union apprenticeship
programs, which they believe provide more benefits and stability than
non-union jobs. For example, staff estimated that women who completed
their gateway program and, subsequently, a formal apprenticeship program
were able to earn as much as $30 per hour.

  Programs Use Training Approaches Relevant to Local Job Markets

Many programs aim to provide clients with the training necessary to fill
jobs in high demand in the local job market, such as health care,
technology, and financial services. A number of programs direct clients to
pursue occupations where shortages exist. For example, the District 1199C
Training and Upgrading Fund program in Philadelphia, Pennsylvania, and the
Johns Hopkins Skills Enhancement Program in Baltimore, Maryland, provide
career paths for clients with health care professions, where there is a
shortage in long-term care and other related high-demand health care
occupations. In the San Francisco Bay area, two programs we visited
prepare clients to fill vacancies in the biotechnology and computer
technology fields. According to San Francisco Works' executive director,
San Francisco is home to approximately 100,000 biotechnology jobs and that
number is expected to grow by 50 percent. Graduates of San Francisco
Works' biotechnology program fill positions that do not require a 4-year
degree, such as lab technicians or media assistants. The Street Tech
program also responds to the demand for technology positions in San
Francisco and helps low-income individuals gain skills with the potential
to move them toward higher wages. According to program administrators,
students who complete the Street Tech program secure entry level jobs that
range from $15 to $20 an hour and fill the demand for computer technical
personnel, one of the fastest growing fields in their county.

A number of programs we visited consider the amount required for
individuals in their localities to be self-sufficient before placing
clients into employment. The state of Pennsylvania and counties in
California encourages service providers and caseworkers to use the
Self-Sufficiency Standard developed by Family Economic Self-Sufficiency
Project9 as a target when developing client employment plans. According to
the Family Economic Self-Sufficiency Project, the standard calculates how
much money working adults need to meet their basic needs without subsidies
like welfare or food stamps. Unlike the federal poverty standard, the
Self-Sufficiency Standard accounts for the costs of living and working as
they vary by family size and composition and by geographic location. Both
the PathWaysPA non-profit program in Philadelphia and local government
officials of San Francisco County in California worked together with other
local government officials and non-profit agencies in their respective
regions to establish a local self-sufficiency standard for their TANF
clients.

Post-Secondary Education Strategies Aim to Leverage College Degrees to Move
Participants into Better-paying Jobs

Some programs we visited help motivated, qualified, low-income clients
pursue education beyond high school, with the belief that higher education
is key to moving individuals into higher wage jobs. For example, the goal
of the LIFETIME program in Oakland, California, is to help low-income,
TANF mothers earn 2- or 4-year college degrees in order to increase their
earning potential. The LIFETIME program employs peer counselors who have
already successfully completed a post-secondary degree under TANF to serve
as models for clients in order to demonstrate that combining education and
welfare is possible and permissible under current law. Staff will also
help clients select a career path that matches their personal interest and
aptitude.

Likewise, the AchieveAbility program, a nonprofit located in Philadelphia,
Pennsylvania that serves TANF and other low-income clients, operates on
the premise that clients should earn at least an associate's degree in
order to earn incomes that would allow them to be self-sufficient. In
exchange for continuing in housing partially funded by HUD, AchieveAbility
clients must pursue education and to complete a GED and 2-year degree.
Participants are also given the opportunity to participate in cultural and
other educational activities.

9The Family Economic Self-Sufficiency Project is an effort initiated in
1996 by Wider Opportunities for W omen and three national partner
organizations-the Corporation for Enterprise Development , the Ms.
Foundation for Women , and the National Economic Development and Law
Center -to provide resources and technical assistance to community-based
advocates and states on human resource investment policies, and to gain
support for strategies that can improve the chances for self-sufficiency
for low-income families. The project is funded partially through the
support of the Ford Foundation, the Annie E. Casey Foundation, the Norman
Foundation and the Rockefeller Family Fund.

Microenterprise Strategies Can Give TANF Recipients Tools to Run Small
Businesses

We encountered several programs using microenterprise strategies that
encourage participants to run their own small businesses to either
supplement or provide their sole source of income. These programs
generally target low-income individuals who are highly motivated, but live
in a region with few employment opportunities. Two programs in rural
Montana featured self-employment training: Career Transitions and the
Career Training Institute. While the Career Training Institute in Montana,
provides a variety of employment training services to its clients, it
actively markets microenterprise development to their TANF clients. While
the Institute staff acknowledged the low success rate of these start-ups,
they argue that microenterprise training does help clients build a variety
of important skills.

In Belgrade, Montana, the Career Transitions program provides its
microenterprise clients with 50 hours of self-employment and business
training. The program will often receive TANF clients who require longer
term training and more intensive case management than what is considered
available through the county TANF office. Individuals who successfully
complete the training and produce a feasible business plan are eligible
for low interest loans to implement their plan. A unique feature of the
Career Transitions program was the ability for clients to sell and test
market their business ideas at the organization's weekend farmer's market.
One official from the Career Transitions program said that, for many
low-income job-seekers, self-employment is the best way to become
self-supporting. This is particularly true for custodial parents of young
children, for whom, staff explained, self-employment provides a means to
work out of the home and also fulfill care giving responsibilities. Those
clients who have been successful have gone on to develop enterprises
ranging in scale from part-time home-based businesses to retail operations
with multiple locations.

Figure 3: Vendors Sell Produce and Other Goods in the Career Transitions
Farmers' Market in Belgrade, Montana, Where Microenterprise Students Can
Test Their Business Ideas

One program we visited provided microenterprise assistance to low-income
women in an urban environment. The Women's Initiative for Self Employment
is a nonprofit that offers training and technical and financial assistance
for prospective women small business owners in the urban San Francisco and
East Bay area. While the Women's Initiative does serve TANF clients,
sometimes through referral by TANF caseworkers, and other low-income
workers, some participants in the program have strong skill sets and work
histories and may be only temporarily low-income. The program's Executive
Director attributed the success of the program to the use of a model that
is tailored to clients' needs and argued that the fundamentals of their
program model are equally applicable in urban and rural environments. She
also reported that participants who make the transition off of welfare are
more likely to approach self-employment as a full-time venture, rather
than part-time.

Asset-building Strategies Emphasize Savings and Financial Education

While the training, education, and microenterprise strategies primarily
focus on employment, asset building strategies emphasize savings and
financial education and literacy as important stepping stones to greater
economic security for TANF clients. Programs we visited were using
financial asset-building strategies on the premise that families must
accumulate assets, through savings accounts and homeownership, and acquire
financial management skills in order to move toward self-sufficiency.
Among the tools used by programs are IDAs and the EITC. The 1998 Assets
for Independence Act authorized federal funding for a series of state and
local IDA programs. IDAs are personal savings accounts that enable
low-income persons to combine their own savings with matching public or
private funds to purchase homes, start or expand businesses, advance their
education, or purchase other assets that will promote economic
self-sufficiency10. The act authorizes grants to qualified non-profit
organizations (including low-income credit unions and designated community
development financial institutions), as well as state, local and tribal
government agencies, to conduct 5-year demonstration projects under which
non-federal sources contribute at least one-half of the project funds up
to $1 million. Proponents of the IDA program often educate low-income
individuals about the use of the EITC, a federal tax credit for low-income
families, in order to facilitate asset accumulation.

In Philadelphia, the Campaign for Working Families, sponsored by several
public and private funding sources to help low-income families move into
the middle class, partners with several other organizations including the
Women's Opportunities Resource Center to help families build assets and
establish IDAs. The Campaign for Working Families encourages clients who
use the organization's free tax preparation services to roll their EITC
savings into an IDA. The IDA program, funded in part through an HHS Assets
for Independence grant, requires clients to participate in financial
management classes and save a minimum of $10 per week in order to receive
up to $2,000 in matching funds over a 2-year period. Savings may go toward
home purchase or repair, higher education, or self-employment. In Chicago,
the Bethel Employment and Training Center partners with the First Bank of
Oak Park to provide clients with a 2-to-1 match for up to $1,800. In order
to be eligible to receive matching funds, participants must attend 10
classes on budgeting and other financial topics. Like the Philadelphia
program, clients can use the IDA money for education, housing, or to start
a business. One official reported that most participants in the Chicago
program use the funding for education.

10The IDAs authorized by the Assets for Independence Act are more limited
in terms of the types of expenditures allowed.

In addition to savings, we visited programs that promote financial
literacy. Through its "Building Blocks to Financial Success" course, the
Women's Opportunities Resource Center teaches money management skills
including savings, debt management, financial planning, and banking. The
"Building Blocks" program is available both online and in a classroom
setting. All participants in the Women's Resource Center IDA program must
complete the "Building Blocks" curriculum.

 A Network of Non-Profits, TANF Agencies, Employers, and Community Colleges Is
                           Key to Operating Programs

The programs we visited relied on a network of support to help TANF
clients prepare for and attain well-paying jobs. Typically, the programs
we visited were run by non-profit organizations providing services to TANF
clients either under contract with a TANF agency or using a mix of public
and private funding sources. Some state and local welfare agencies,
through adopting specific policy provisions such as allowances for
post-secondary education, also played a key role in fostering the
strategies in this report. In addition to core services, local non-profits
and TANF agencies either directly provided or helped link clients to
services such as child care, housing, and on-the-job support. As part of
the wider network, local non-profits and TANF agencies established
partnerships with employers and community colleges to develop curricula
and create career ladders and work opportunities for TANF clients.

Collaboration Between Local Nonprofits and TANF Agencies Is Key to Implementing
These Strategies

The vast majority of programs experts identified as using one or more of
the four strategies were private, non-profit organizations, rather than
the local welfare office, although in some cases employers, unions, or
community colleges provided the actual services. As a result, the programs
we visited were predominantly non-profits, although we also made an effort
to connect with the TANF office in each locality. TANF recipients were
connected to these programs through a variety of methods, including formal
referrals through the TANF agency or other programs and word-of-mouth
recommendations from friends and family. (See fig. 4.)

Figure 4: Ways in Which TANF Clients Were Connected to Programs

Many of the programs served TANF clients along with other low-income
people. Welfare recipients generally made up between 10 and 60 percent or
more of the clientele of the programs we visited. The officials we met
with cited some advantages to this approach. Namely, interaction between
TANF and non-TANF clients provides role model opportunities, allowing
clients to learn from the example set by low-income job seekers with more
established work histories. Furthermore, officials posited that welfare
recipients may be more attractive to employers if they are viewed simply
as out-of-work job seekers rather than branded as TANF clients.

Some of the programs we visited provided services to TANF clients through
a contract with the state or local TANF office, while others received
funding from a variety of public and private sources. Officials from two
programs said this approach gave them an advantage over government
agencies and other entities with a single-source funding mechanism and
protected them to some degree from shifting state and federal budget
priorities. In addition, administrators from two different programs said
that there are psychological benefits to being distinct from the TANF
program, as many needy clients who perceive a stigma around public
assistance may be more likely to seek help from a group that is not
explicitly linked to the welfare office. Moreover, some programs told us
they chose to use other funding sources because they believed the work
focus of the current welfare system was a barrier to offering strategies
like education and training. Some of the experts we consulted and other
researchers shared similar concerns that the system's focus on "work
first" may discourage the development of education and training approaches
that delay a client's entry into the workforce. Specifically, program
officials we interviewed cited the eligibility restrictions, work and
reporting requirements of some federal funding sources, including TANF and
the Workforce Investment Act (WIA), as deterrents. Other officials told us
that pursuing certain government grants and contracts would have forced
them to set aside their mission or would have placed an undue
administrative burden upon their organization.

State and local TANF policies can play an important role in facilitating
the use of employment support strategies. States can provide support to
local programs by crafting TANF policies with a focus on specific
priorities or in response to the unique needs of their TANF population,
even if those priorities are not reflected in federal welfare legislation.
For example, in a recent legislative session, representatives from the
state of Montana, following Maine's lead, passed legislation that will
allow some of its TANF clients to count pursuing a 4-year degree toward
meeting state TANF work requirements. Until 2004, Montana's TANF program
was able to do this because the state had in place-prior to welfare
reform-a waiver from certain federal TANF requirements, including those
that would not allow this type of educational activity to count as a
permissible federal work activity unless it was combined with another
activity, such as part-time work. In another effort focused on increasing
education levels among TANF clients, the governor of Kentucky launched an
initiative in the late 1980s to centralize oversight for the state's
community and technical colleges, believing that a more centralized
approach might make it easier for low-income families to pursue higher
education. This development served as the cornerstone of more recent
efforts to better integrate the education and workforce systems. In our
site visits in Kentucky, we saw links between community colleges and TANF
agencies.

In addition to core employment-related services, providing pre- and
post-employment support services was a key factor in facilitating TANF
recipients' involvement in these programs. Local nonprofits and TANF
agencies either directly provided or helped link clients to services such
as child care, housing, on-the-job support, transportation, and other
assistance. For example, in Chicago, the Project Match program allows
clients to return again and again over a period of years until they are
permanently employed. Also in Chicago, The Cara Program delivers
on-the-job support to participants for their first 9 months of employment.
Other programs we visited offer a host of other supports like housing,
child care, or referrals to other programs to help clients engaging in
training and other work preparation activities. For example, the District
1199C Training and Upgrading Fund program in Philadelphia helps
participants locate assistance for child care and transportation
subsidies. Some programs focus on specific populations of at-risk job
seekers, such as the Bethel Employment and Training Center program in
Chicago that specializes in providing employment assistance to former
felons. State and local TANF offices also help facilitate the necessary
support services, such as child care and transportation, that make it
possible for clients to participate in these programs. Typically, the TANF
agency has flexibility to fund and support services to a given TANF client
regardless of whether that client is participating in a program that
receives TANF funds.

Some of the organizations we visited do not directly provide services, but
could be characterized as service brokers, referring or linking
participants with other programs in the community. For instance, Women's
Opportunity and Resource Development, Inc., in Missoula, Montana, operates
as a clearinghouse for services for TANF clients. SF Works operates on a
similar model. Although it provides a handful of services directly, it
generally operates as an intermediary to ease the way for TANF clients to
take advantage of the biotech prep coursework available to them. Another
California program, LIFETIME, lends support and guidance to single mothers
on welfare to help them complete post-secondary education. Again, although
it does not directly provide training or other services, it assists its
constituency by connecting them to the necessary support services
delivered by other providers in the community.

Partnerships with Local Employers and Community Colleges Yield Additional
Resources for TANF Clients

As part of the broader network, local non-profit programs and TANF offices
often forged partnerships with local employers to open up job
opportunities for their clients. For example, The Cara Program in Chicago
has developed relationships with employers in the financial services
industry, such as JP Morgan, to place clients in entry level positions
with the potential for advancement, such as mailroom check processors.
Program officials told us they turned applicants away based on active
substance abuse problems or criminal backgrounds, out of concern about
compromising their relationships with potential employers. In San
Francisco, one of the nation's highest-paying markets in the legal
services industry, one group developed a program to train TANF clients to
serve as paralegals.

Other programs consulted with employers to develop training curricula and
gather other information related to employer needs. Input from employers
is an essential component to ensure effective training that addresses
labor market needs. The San Jose CET worked directly with employers to
develop curricula tailored to local labor market needs. Some non-profits,
such as the San Francisco Works program in San Francisco, were founded by
a group of enterprising businesspeople who saw an opportunity to connect
job-seeking welfare recipients in the work-focused system of the 1990s
with open positions created by San Francisco's booming economy.

In addition to employers, some programs also partnered with or originated
within unions to assist TANF clients in finding work. For example, the
Montana PEAKS program is housed in a building owned by the local
steelworkers union, and the head of the program reported that she had
established relationships with unions for the logging, construction and
aluminum refinery industries to expand the job opportunities available to
her clients.

In addition to employers, program officials cited their partnerships with
community colleges as important sources of additional resources and
expertise. For example, the Brighton Center's Center for Employment
Training program in Lexington, Kentucky, negotiated an agreement with the
Central Kentucky Technical College to allow CET students to transfer their
CET credits to the college. In other cases, the community colleges
directly provided training and post-secondary education services to TANF
clients. For example, students in the San Francisco Works program took
classes on-site with the partner community college.

HHS Is Supporting Research, Providing Technical Assistance, and Sponsoring
  Targeted Grant Funding, but Additional Research and Technical Assistance Are
                                     Needed

Through research, technical assistance, and grant-making activities, HHS
plays an important role in fostering the four strategies identified in
this report that are designed to help TANF participants raise their
incomes. Although HHS has several efforts underway, more needs to be known
about the effectiveness of strategies for building individuals' skills and
earnings capacity and how to incorporate them as options within state and
local TANF programs. Within HHS, the Administration for Children and
Families (ACF) has primary oversight responsibilities for TANF and for
these efforts, most of which have focused on promoting financial asset
building and training strategies. HHS' Office of the Assistant Secretary
for Planning and Evaluation (ASPE) also plays a key role in research
efforts.

HHS Conducts and Shares Research on Employment and Asset-building Strategies

HHS is engaging in several research projects focused on helping TANF
clients and other low-income individuals find higher-wage employment and
build their assets. One such effort, the Employment Retention and
Advancement project, will identify and test program models designed to
promote employment stability and increased earnings for TANF recipients
and other low-income individuals. Started in 1998, this evaluation will
test the effectiveness of 15 programs in eight states. The program models
under review are designed to help participants retain jobs or advance in
their careers, or both.

Each program provides a package of services that will be compared. For
example, participants in one career advancement program meet with "career
and income advisors" to develop a career and income advancement plan that
takes into account the client's current job, career goals and specific
barriers. Evaluations of this and the other program models will focus on
the impact of receiving this package of services. TANF and other
low-income individuals participating in the programs will be tracked for
up to 5 years. While some preliminary results are available, final results
from this 10-year evaluation are not expected until 2008. Evaluation
results from this study can provide important information about the
various combinations of services that might lead to positive outcomes for
low-income individuals.

To complement these efforts, HHS has also made contributions to the New
Visions Self-Sufficiency and Lifelong Learning Project currently underway
in California. A partnership between the local community college and the
Department of Social Services, the project focuses on earnings gains as a
primary measure of improvement in employment prospects of working parents
who also receive TANF.

In addition to the Employment Retention and Advancement project, in 2010,
the agency expects final results from a second research effort-the
Hard-to-Employ Demonstration and Evaluation Project-a 10-year study to
identify effective strategies for improving employment outcomes for
current or former TANF recipients and other low-income individuals who
have had difficulty finding and holding down jobs. While both the
Hard-to-Employ Demonstration and Evaluation Project and the Employment
Retention and Advancement project are designed and managed by HHS, Labor
also provides some funding.

HHS also recently supported research comparing the job requirements of
high demand positions in the long-term care industry to the skill profiles
of TANF clients. This study explored the possibility of training TANF
clients to fill these needs and identified challenges programs face in
designing and implementing a long-term care training program for TANF
clients. On the demand side, HHS is also about to undertake a nationally
representative survey of employers in an attempt to understand more about
the factors that ensure a TANF job-seeker success in the workplace. In
addition, the agency is reviewing current research to better understand
the role that asset building plays in addressing poverty. More
specifically, they are looking at the factors influencing low-income
families' asset accumulation, as well as possible effects. The agency also
plans to examine how means-tested program rules may affect low-income
families' ability to build assets. Finally, in recognition of employment
barriers facing TANF job seekers in rural areas, HHS has also launched a
demonstration project to evaluate the effectiveness of welfare-to-work
strategies being used in rural areas, with final results due in 2007.11

These research efforts are a part of HHS' broader research and evaluation
efforts that include analysis of healthy marriage and responsible
fatherhood initiatives, evaluations of other related welfare-to-work
grants programs as well as research designed to address the needs of
special populations such as low-income individuals with additional
barriers.

11For more information, see GAO, Welfare Reform: Rural TANF Programs Have
Developed Many Strategies to Address Rural Challenges, GAO-04-921
(Washington, D.C.: Sept. 10, 2004).

The agency also has taken steps to share research findings with local TANF
programs, welfare researchers, and policymakers. Since 1998, HHS'
Administration for Children and Families has sponsored an annual Welfare
Research and Evaluation Conference to share evaluations of welfare reform
and formulate ways to incorporate these findings in the design and
implementation of programs. In addition, ACF and ASPE make research
results available through presentations at other conferences related to
welfare and low-income issues, their agency websites, and online
announcements sent to subscribers. For example, officials noted that ASPE
and ACF work together to send "TANFnet" announcements to state program
administrators; currently TANFnet goes to 300 state administrators.

Another source of research on these types of strategies could be the
programs using them, although this was not the case among those we
visited. Few of the programs reported plans for rigorous research and
evaluation. A number of the officials we met with cited a lack of
dedicated funding as the reason for not doing more in the way of
evaluation and outcome measurement. Some individual programs had
undertaken efforts to measure participant outcomes and two mentioned plans
for a rigorous experimental design evaluation that could result in an
assessment of its effectiveness.12 Often, when a program did collect data
on participant outcomes, the indicators of interest were directly related
to employment-program wide job placement rate, individual wage gain,
length of tenure in a given job or access to benefits. However, some
programs were interested in a broader spectrum of progress indicators. For
example, the Project Match program in Chicago oversees a central database
that tracks a variety of individual performance indicators for a number of
area programs. These may include progress on work preparation activities,
family or personal activities (e.g., going to medical appointments), and
housing and financial activities (e.g., eliminating a debt).

This forthcoming research will expand existing knowledge about
welfare-to-work strategies in important ways, but more remains to be known
about designing and implementing programs that can increase low-income
parents' earnings capacity and move them into higher-wage jobs. For
example, research could help identify (1) more information on specific
education and training strategies that work and what the key program
elements are that lead to success and that can be replicated; (2) ways to
incorporate education and training strategies into the lives of low-income
individuals, whether as part of a welfare-to work program or in
combination with part- or full-time work; (3) which strategies work best
for those with varying skill levels, including how best to target
educational and training skills to specific job needs, particularly for
those who may not succeed in a classroom setting; and (4) which service
delivery approaches are the most effective and cost-efficient, including
understanding more about the most appropriate provider or access point,
such as the welfare, educational, or employment and training systems or
some combination of these.

12The two experimental design evaluations are funded by a variety of
federal and foundation sources.

A new initiative HHS has recently launched, called the Innovative
Employment Strategies Project, could help to identify additional research
opportunities within existing resource constraints. This project is
designed to document promising practices to help TANF and other at-risk
families achieve self-sufficiency through employment and to make
recommendations for further research.

HHS has a strong tradition of leading and supporting rigorous welfare
research and is well-positioned to continue to promote and support
additional research, although it faces considerable challenges in doing
so. In 2003, we recognized ACF as an agency with an evaluation culture
based on its efforts to plan, execute and use information from
evaluations13 and highlighted it as a model for other agencies. As part of
this culture, it has played a role in working with methodological experts
and partnering with state and local welfare agencies to promote and
support the importance of evaluation to state and local welfare agencies.
At the same time, HHS faces considerable challenges to support research in
the new and evolving welfare environment. These include:

           o  limited authority to oversee states and reduced resources under
           TANF;

           o  fewer incentives for states to evaluate their programs than
           existed under the previous welfare program with its waiver,
           evaluation, and funding provisions;

           o  the increasingly decentralized welfare environment with a
           multitude of players involved in delivering services and operating
           programs; and

           o  the broadened population of interest under welfare reform,
           including current and former welfare recipients and other
           low-income parents.

13GAO, Program Evaluation: An Evaluation Culture and Collaborative
Partnerships Help Build Agency Capacity, GAO-03-454 (Washington, D.C.: May
2, 2003).

Still, HHS has a track record of successfully working with research
experts and state and local governments, as well as its federal partners
Labor and Education, to make important contributions. In addition, it has
already broadened its research agenda to conduct and promote research
beyond TANF recipients. The types of strategies we identified form a
critical area to explore as welfare reform evolves.

HHS Provides Targeted Grants That Encourage Use of Strategies

HHS also supports strategies designed to help TANF clients raise their
incomes through targeted grants. In addition to the TANF grant-one of the
most significant and likely sources of funding for welfare programs-the
agency also offers two smaller grant programs that directly support the
employment and asset-building strategies discussed in this report. The Job
Opportunities for Low-Income Individuals (JOLI) and Assets for
Independence (AFI) programs, both administered by ACF's Office of
Community Services, are designed to help TANF clients move into
higher-wage employment or build financial assets through use of strategies
such as training, asset building and microenterprise development.

The JOLI grants, created in 1988, provide funding to organizations
interested in creating job opportunities for TANF recipients and other
low-income individuals with the goal of economic self-sufficiency.
Nonprofit organizations receiving JOLI grants are required to use specific
types of strategies such as training women and minorities for
nontraditional jobs and supporting the development of microenterprises. In
addition, HHS requires these organizations to establish a cooperative
relationship with the state TANF agency, in an effort to ensure that TANF
clients benefit from services funded by JOLI grants. In fiscal year 2004,
about $5 million in grant funding was awarded. The agency is currently
developing evaluation tools to assess the effectiveness of programs funded
by JOLI grants.

HHS' AFI grants support asset accumulation among TANF recipients and other
low-income families by funding financial education and economic support
services. In addition to providing services such as financial education
and assistance accessing tax credits, organizations receiving AFI grants
help low-income individuals and families open special purpose savings
accounts called IDAs that are matched with grant funds. Participants can
use the money they save for postsecondary education to purchase a first
home or start a small business. According to HHS, there are currently more
than 315 AFI projects active across the country, and more than 21,000
families have opened IDAs through the AFI project . The average AFI grant
award is $350,000 across a 5-year grant period. In 2007 ACF will publish a
final evaluation of the effectiveness of the AFI grant projects.

Use of Strategies Facilitated through Technical Assistance Provided by the
PeerTA Network and HHS Regional Offices

HHS supports the use of strategies identified in this report by providing
technical support to TANF programs through the Welfare Peer Technical
Assistance Network. The Network is comprised of states, counties,
localities, and community based organizations and provides opportunities
for members to learn from each other via round tables, site visits,
teleconferences and a Web Site. Upon request, the Network provides
opportunities for members to share experiences and solve common problems.
For example, in 2005, the Network sponsored a 3-day event focused on
innovative strategies to increase self-sufficiency outcomes in rural areas
and in 2004 and 2005 co-sponsored with the Internal Revenue Service (IRS)
two roundtable discussions about the use of the EITC. In 2002, the Network
joined forces with Labor to focus on promoting IDAs.

HHS also supports these strategies by disseminating information to state
and local TANF programs through ACF's 10 regional offices. Most often,
regional offices sponsor regional conferences or workgroups to share
effective strategies for meeting the needs of TANF recipients. For
example, one regional office publicized a state post-secondary educational
program that regional officials believed to be a promising practice.
Information about this program was shared within the region and
nationally. A second regional office organized a meeting in 2002 for
several states to gather and discuss the administration of IDA programs.
In 2004, this same regional office hosted a teleconference to discuss
strategies and ways to develop successful work experiences for TANF
clients in rural settings.

Regional offices sometimes collaborate with other federal agencies in
these efforts. For example, one ACF regional office worked with Labor to
sponsor a conference designed to provide technical assistance to a state
level TANF office on how to help move TANF recipients into health care
jobs. Another regional office collaborated with the IRS to disseminate
information about the EITC to states with the goal of helping TANF
programs develop organized efforts to increase the number of low-income
families who claim the credit. Some regional offices, in collaboration
with federal agencies such as Labor and the Department of Transportation
(DOT), have organized multi-state meetings on the specific challenges
facing rural areas, as well as promising strategies. Regional offices have
also shared information with TANF program administrators through the use
of newsletters, electronic listservs and site visits.

While HHS has provided some technical assistance to facilitate use of
these strategies, the overall emphasis of welfare reform on work rather
than education and training is sometimes perceived by programs as a
barrier to implementing these strategies for TANF recipients. As we noted
previously, some programs we visited believed they would have to change
their program design and mission in order to get TANF funding or did not
want to meet what they believed to be onerous program requirements while
other providers made adjustments to meet their own mission goals and TANF
work requirements. Some of the education focused providers were supported
by state TANF programs that were specifically designed to include such
options. It is not clear whether all program administrators, programs, and
policymakers understand ways they can include education and training
components as a part of their TANF programs. HHS headquarters and regional
offices that work with program officials to share concrete information on
what others have done to incorporate such strategies can help
administrators understand the full range of program strategies that they
may use at their option. While some program design decisions are made at
the state level, often it is up to local TANF administrators to choose
program strategies. As a result, it is important for HHS to provide
assistance to both state and local administrators. Moreover, because many
of the strategies we identified may involve efforts under the purview of
Labor and Education, some of the cross-agency efforts identified by some
of the regional offices may be particularly useful in providing technical
assistance. While some regional offices noted such cross-agency efforts,
others did not.

Other Federal Agencies also Play a Role Encouraging Use of Strategies

Beyond HHS, a number of other federal agencies also provided research,
technical assistance and targeted grants in support of grants designed to
help TANF clients and other low-income individuals achieve higher-wage
employment and build financial assets, sometimes in conjunction with HHS.
For instance, HHS is a contributing partner to Labor's National Work
Advancement and Support Center Demonstration. In addition, Labor's High
Growth Job Training Initiative, while not specifically targeted to
low-income individuals, seeks to train participants with training for high
growth jobs such as those in the health care industry. As mentioned
earlier, HHS is in the process of evaluating this practice as a possible
approach for pairing TANF clients with opportunities in the burgeoning
long-term care industry. In addition, from 1994 through 2003, Labor's
Women in Apprenticeship and Nontraditional Occupations program has funded
community based organizations to provide technical assistance to employer
and labor union efforts to place and retain women in apprenticeship and
nontraditional occupations.

Several other agencies have promoted the use of these strategies. For
example, the Department of Education-in addition to collaborating with HHS
and Labor on welfare-to-work research efforts-has sponsored its own
research on community colleges' role in welfare-to-work training. The
agency has also provided technical assistance to state TANF administrators
about post-secondary education as it pertains TANF. Additionally, the IRS
has supported asset-building strategies by partnering with HHS in the
Delta Initiative--an effort whereby both agencies are working to increase
the number of TANF and other low-income families in the seven state
Mississippi Delta region who apply for the EITC.14 The Department of
Transportation also has several efforts designed to help low-income
individuals, as well as efforts to train and support women and minorities
for entry into highway construction and maintenance jobs. In addition, DOT
permits states to reserve some On-the-Job Training program positions for
TANF clients. In addition to DOT's efforts, HUD has launched the Jobs-Plus
demonstration to increase labor force attachment among public housing
residents (many of whom are also TANF clients) by issuing grants to local
housing authorities to provide residents with employment-related services
and incentives to improve their employment prospects.15

                                  Conclusions

Our review focuses on promising strategies for increasing welfare clients'
incomes and the role that HHS can play in supporting these strategies. The
sweeping welfare reforms of the last decade shifted the focus of the
federal welfare program from issuing benefit checks to a broader mission
of moving families into economic independence. Under the TANF block grant,
states are funding a variety of programs designed to help clients make a
successful transition into the workforce. This has carved out an important
role for the broader workforce development and educational network-local
non-profit programs, employers, community colleges, and other
organizations. As a result, welfare recipients now prepare for work in a
more decentralized environment where service providers may rely on a
combination of public and private funding sources beyond TANF funding
streams. The Departments of Education and Labor and other federal agencies
have also expanded their roles in providing work-related services for TANF
clients and other low-income people.

14The National Organization of Black County Officials is also a partner in
this effort.

15The Jobs-Plus demonstration is funded through HUD's Moving-To-Work
initiative, and matched by a grant from the Rockefeller Foundation, with
additional support from other public agencies and philanthropies.

While all of the strategies and programs we visited may show promise and
help some welfare recipients find better jobs, research does not yet exist
to isolate which strategies work best, for whom, and under which
conditions, not to mention how to deliver services in the most
cost-effective manner. However, the significant federal dollars spent on
TANF warrants continued federal research efforts and attention from HHS,
as well as Education, Labor, and other relevant agencies. Many of the
strategies covered in this report represent new, or at least untested,
approaches in the realm of welfare-to-work services. They deserve an
opportunity for the kind of validation that only rigorous research can
provide.

Finally, in a time of scarce budgetary resources, it is appropriate that
HHS and state TANF programs make full use of the vast array of strategies
and programs available at the local level to help welfare recipients
achieve the goal of self-sufficiency. According to experts, many state and
local organizations have developed new and promising approaches with the
potential to improve clients' economic stability and career prospects.
These practices hold value for the individuals and agencies directly
involved and can provide important lessons for others. As the federal
agency charged with helping low-income parents avoid dependence on
welfare, HHS has several mechanisms to share research and information on
effective and promising practices with programs providing services to TANF
clients, such as its regional offices or partnerships with other agencies.
However, some innovative programs serving welfare clients operate at the
local level-not linked to HHS-and others may not receive direct funding
from TANF and therefore may not be known to local, state, or federal
officials. Because of these factors, HHS officials may find it
increasingly challenging to gather and disseminate information on
promising practices or to provide technical assistance for local programs
wishing to implement these promising strategies. It is more difficult, but
important, to reach all of the parties now involved in delivering
welfare-to-work services in this more decentralized environment.

                      Recommendations for Executive Action

To help ensure that the federal government considers research on these
promising strategies and better informs welfare agencies and programs
about how they might incorporate such strategies for TANF recipients, we
recommend that the Secretary of HHS:

           1. Review its current research agenda and identify opportunities
           to conduct and promote additional research on increasing earnings
           capacity among low-income parents.
           2. Review existing research dissemination and technical assistance
           efforts across its relevant units to better ensure a comprehensive
           process for distributing information and implementation assistance
           to the wide range of program administrators and programs involved
           in welfare reform.
           3. Seek out additional opportunities to work with the Secretaries
           of Labor and Education to jointly conduct and promote research and
           distribute information and implementation assistance related to
           enhancing skills and earnings capacity among low-income parents.

                       Agency Comments and Our Evaluation

We provided a draft of this report to HHS for its comments; these appear
in appendix III. In its comments, HHS said that the recommendations were
not necessary or warranted given that it is already carrying out a strong
portfolio of research, evaluation, technical assistance and dissemination.
It also stated that our conclusions and recommendations about promising
strategies do not reflect existing research evidence. We disagree. While
acknowledging HHS' past and ongoing efforts, already discussed in the
report, we continue to think additional efforts are warranted. In
addition, our conclusions and recommendations are firmly based in existing
research.

More specifically, as the report introduction and background discuss and
as HHS notes, welfare reform is built upon a considerable research base.
This research shows that welfare-to-work interventions can increase
employment and reduce welfare use and that a mixed approach-with a strong
work focus and some education and training as needed-shows the greatest
earnings gains. This research also shows that the most successful
approaches tested generally do not lead to stable, higher-paying
employment. As a result, many former welfare recipients rely on other
forms of government aid to help make ends meet and some return to the
welfare rolls. We have added to our discussion of this research in the
background section. A key unanswered question-and the focus of this
report-is about identifying and testing additional ways to help low-income
parents support their families through employment rather than reliance on
government supports. We acknowledge that HHS has several important
research efforts under way to shed light on these issues. Our
recommendation asks HHS to review its research agenda and seek out
additional opportunities, given the importance of improving outcomes for
low-income parents.

We maintain that while not yet proven effective, the practices we
identified hold promise and warrant additional attention in HHS'
portfolio. We acknowledge that some strategies, such as microenterprises,
will probably always be of limited scale. We also clearly understand that,
as HHS said, Congress created work requirements that emphasized some core
activities and deemphasized others, such as post-secondary education. At
the same time, Congress gave states flexibility to include other
approaches deemed to address state and local needs and some administrators
we spoke with believe post-secondary education can play a role in moving
families permanently off welfare. We also identified promising short-term,
work-focused training strategies that would fit within existing TANF work
requirements. HHS stated that we recommend that it do more to encourage
states to shift their focus toward activities not emphasized by Congress.
What we found, and what we do recommend, is that the wide range of program
administrators involved in helping low-income parents avoid welfare
dependence would benefit from an even greater effort by HHS to provide
information and practical technical assistance about promising practices.
We think further collaboration among HHS, Labor, and Education in
providing technical assistance warrants attention.

As we already discuss in the report, HHS has several relevant and very
important research efforts under way that will provide valuable
information to policymakers. We understand that choices about where to
focus limited research resources must be made and that its ongoing efforts
are just one part of a larger portfolio of research related to TANF goals,
including research on promoting safe and healthy marriages and fatherhood
initiatives. We added language to the report to acknowledge these resource
constraints. However, within these constraints, we still think it
important that HHS explore opportunities to conduct and promote research
on ways to increase low-income parents' incomes through employment. We
also think it particularly important that it expand its collaborations
with Labor and Education in addressing these issues. Much remains to be
explored about whether and how best to incorporate education and training
into the lives of low-income parents to improve employment outcomes.
Potential benefits include improved household incomes, reductions in
government benefit programs, and increased contributions to the nation's
workforce. We note that HHS cited the President's proposal for TANF
reauthorization as an opportunity that would give HHS additional funds to
explore promising practices.

In some cases, HHS' comments included information on research,
dissemination, or technical assistance activities that it had not shared
with us earlier; these have been added to the report. We also made
revisions in some of our summary statements and other areas to better
ensure HHS' existing efforts were acknowledged and to add clarification.
HHS also provided technical comments that we incorporated as 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
the Secretary of the Department of Health and Human Services, appropriate
congressional committees, the Secretaries of Labor and Education, and
other interested parties. In addition, the report will be available at no
charge on GAO's Web site at http://www.gao.gov.

If you or your staff have any questions about this report, please contact
me at (415) 904-2272 or [email protected]. Contact points for our Offices of
Congressional Relations and Public Affairs may be found on the last page
of this report. Key contributors to this report are listed in appendix IV.

David D. Bellis Director, Education, Workforce, and Income Security Issues

Appendix I: List of Experts Interviewed Appendix I: List of Experts
Interviewed

Officials with expertise in welfare-to-work strategies were interviewed
from the following organizations.

Goodwill Industries of Southwestern Michigan Jobs For the Future
Mathematica Policy Research, Inc. MDRC National Conference of State
Legislatures National Network of Sector Partners Professor Harry Holzer,
Georgetown University Public Private Ventures The Annie E. Casey
Foundation The Aspen Institute The National Governors Association The
Upjohn Institute The Urban Institute Wider Opportunities for Women

A Appendix II: Program Contact Information

Following is contact information for programs mentioned in this report.

California

Californians for Family Economic Self-Sufficiency (CFESS) National
Economic Development and Law Center 2201 Broadway, Suite 815 Oakland, CA
94612 [email protected] (510)251-2600

Center for Employment Training 701 Vine Street San Jose, CA 95110
[email protected] (408)534-5230

LIFETIME 132 East 12th Street Oakland, CA 94606 [email protected]
(510)452-5192

San Francisco Works 235 Montgomery Street, 12th Floor San Francisco, CA
94104 [email protected] (415)217-5183

Street Tech 2300 El Portal Drive, Suites F & G San Pablo, CA 94806
(510)234-1300

Women's Initiative for Self Employment

San Francisco, CA (510)287-3114 or (415)641-3460

Illinois

Bethel Employment and Training Center 4006 W. Lake Street Chicago, IL
60624 [email protected] (773)826-8430

Chicago Women in Trades [email protected] (312)942-1444

Project Match 420 North Wabash Avenue, 6th Floor Chicago, IL 60611
(312)893-7243

The Cara Program 703 W. Monroe Chicago, IL 60661
[email protected] (312)798-3302

Kentucky

Bowling Green Housing Authority Women in Construction 247 Double Springs
Road Bowling Green, KY 42101 (270)843-6071

Bowling Green Technical College Ready to Work Program 1845 Loop Drive
Bowling Green, KY 42101 (270)901-1000

Brighton Center, Inc. Center for Employment Training (CET) 601 Washington
Avenue, Suite 140 Newport, KY 41071 [email protected]
(859)491-8303

R.O.U.T.E. Training Program Foothills Community Action Partnership 309
Spangler Drive Richmond, KY 40475 [email protected] (859)624-2046

Maryland

Community College of Baltimore County Continuing Education 800 South
Rolling Road Catonsville, MD 21228-5317 [email protected] or
[email protected] (410)455-4920 or 410-455-6922

The Johns Hopkins Skills Enhancement Program Office of Community and
Education Projects Human Resources Department The Johns Hopkins Hospital
600 N. Wolfe Street, Phipps 352 Baltimore, MD 21287 [email protected]
(410)614-0273

Montana

Career Training Institute 347 N. Last Chance Gulch Helena, MT 59601
[email protected] (406)443-0800

Career Transitions 20900 E. Frontage Road, B-Mezz P.O. Box 145 Belgrade,
MT 59714 [email protected] (406)388-6701

Montana PEAKS Inc. Montana Women in the Trades P.O. Box 2209 Columbia
Falls, MT 59912 [email protected] (406)892-5767

WORD (Women's Opportunity and Resource Development, Inc.) 127 N. Higgins,
Suite 307 Missoula, MT 59802 kgough @wordinc.org (406)543-3550

Pennsylvania

AchieveAbility 21 South 61st Street Philadelphia, PA 19139-3008
[email protected] (215)748-8750

Campaign for Working Families

1207 Chestnut Street, 6th Floor

Philadelphia, PA 19107

[email protected]

(215)851-1819

District 1199C Training and Upgrading Fund

1319 Locust Street

Philadelphia, PA 19107

[email protected]

(215)568-2220

PathWaysPA

310 Amosland Road

Holmes, PA 19043

(610)543-5022

Transitional Work Corporation

Land Title Building

100 S. Broad Street, Suite 700

Philadelphia, PA 19110

[email protected]

(215)965-3000

WORC (Women's Opportunities Resource Center)

2010 Chestnut Street

Philadelphia, PA 19103

(215)564-5500

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

Appendix IV: A Appendix IV: GAO Contact and Staff Acknowledgments

GAO Contact

David Bellis, Director (415) 904-2272, [email protected]

Acknowledgments

Gale Harris, Assistant Director, and Tiffany Boiman, Analyst in Charge,
managed this assignment and made significant contributions to all aspects
of this report. Michelle Bracy, Rachael Chamberlin, Lise Levie, Jean
McSween, Angela Miles, Susan Pachikara, Nyree Ryder, and Daniel Schwimer
also made significant contributions to this report.

Related GA Related GAO Products

TANF: State Approaches to Screening for Domestic Violence Could Benefit
from HHS Guidance. GAO-05-701 . Washington, D.C.: August 16, 2005.

Welfare Reform: Rural TANF Programs Have Developed Many Strategies to
Address Rural Challenges. GAO-04-921 . Washington, D.C.: September 10,
2004.

Supports for Low-Income Families: States Serve a Broad Range of Families
through a Complex and Changing System. GAO-04-256 . Washington, D.C.:
January 26, 2004.

Program Evaluation: An Evaluation Culture and Collaborative Partnerships
Help Build Agency Capacity. GAO-03-454 . Washington, D.C.: May 2, 2003.

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.

Welfare Reform: States Are Using TANF Flexibility to Adapt Work
Requirements and Time Limits to Meet State and Local Needs. GAO-02-501T .
Washington, D.C.: March 7, 2002.

Welfare Reform: More Coordinated Federal Effort Could Help States and
Localities Move TANF Recipients with Impairments toward Employment.
GAO-02-37 . Washington, D.C.: October 31, 2001.

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

Welfare Reform: Work-Site-Based Activities Can Play an Important Role in
TANF Programs. GAO/HEHS-00-122 . Washington, D.C.: July 28, 2000.

Welfare Reform: Assessing the Effectiveness of Various Welfare-to-Work
Approaches. HEHS-99-179. Washington, D.C.: September 9, 1999.

Welfare Reform: Information on Former Recipients' Status. HEHS-99-48.
Washington, D.C.: April 28, 1999.

Welfare Reform: States' Experiences in Providing Employment Assistance to
TANF Clients. HEHS-99-22. Washington, D.C.: February 26, 1999.

(130412)

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Highlights of GAO-06-108 , a report to congressional requesters

December 2005

WELFARE REFORM

More Information Needed to Assess Promising Strategies to Increase
Parents' Incomes

Following major welfare reform in 1996, the number of families receiving
cash assistance was cut in half to 2 million. While many former recipients
now rely more on their earnings, they often work at low-wage jobs with
limited benefits and advancement opportunities. To better understand how
to help these individuals and their families attain economic
self-sufficiency, GAO is reporting on (1) strategies designed to increase
income for TANF recipients through employment; (2) the key factors related
to implementing and operating such strategies; and (3) actions the
Department of Health and Human Services (HHS) has taken to facilitate the
use of these strategies. GAO consulted experts to gather information about
promising strategies and visited 26 programs.

What GAO Recommends

GAO recommends that HHS (1) identify opportunities for additional research
on increasing TANF recipients' earnings, (2) review its existing efforts
to better ensure information and implementation assistance reaches the
wide range of program administrators and service providers involved in
welfare reform, and (3) seek out new opportunities to collaborate with
Education and Labor on research and technical assistance. In response, HHS
said that its efforts in these areas are sufficient and do not warrant
additional attention.

Based on interviews with experts and site visits, we identified four
strategies that aimed to increase incomes for recipients of Temporary
Assistance for Needy Families (TANF)-training, post-secondary education,
self-employment, and financial asset building. Training strategies often
targeted services to particular groups or job market needs. Other programs
used post-secondary education to position clients for higher-wage jobs.
Some programs we visited gave participants the tools to run their own
businesses as a way out of poverty. Finally, asset building strategies aim
to help clients save and invest money to pursue career goals and support
their families. The 26 programs we visited used one or more of these
strategies.

A broad network of local non-profits, state and local TANF offices,
employers, and community colleges is key to operating these strategies.
Some of the programs we visited were non-profits under contract with the
TANF office. Others relied on a mix of public and private funds, some
because of concerns that TANF's emphasis on work was a barrier to
providing education and training options. State and local TANF offices,
for their part, sometimes set policies and provide additional funding to
encourage the strategies discussed in this report. Local non-profits and
TANF agencies either directly provided or helped link clients to
supplemental services such as child care, housing, on-the-job support, and
transportation. As part of the broader network, local non-profits and TANF
offices often forged links with employers and community colleges to
leverage additional resources for their clients, including training
curricula, career ladders, and work opportunities.

HHS is supporting these strategies through research, targeted grants, and
technical assistance. Efforts by other federal agencies, such as the
Departments of Education and Labor, also support some of the strategies
discussed in this report. HHS has several research projects focused on
helping low-income individuals find higher-wage employment and build their
assets. While these efforts are important, more needs to be known about
the effectiveness of specific strategies, such as those identified in this
report, in increasing TANF recipients' earnings capacity. In addition to
the TANF block grant, HHS has two small grant programs that support
employment and asset-building strategies. While HHS has provided some
technical assistance to facilitate the use of these strategies, it is not
clear whether service providers understand ways they can incorporate
education and training in a work-focused welfare system. Furthermore, HHS
faces some challenges disseminating information on new research or
promising strategies to all of the organizations providing services to
TANF clients in the more decentralized welfare environment.
*** End of document. ***