[Public Papers of the Presidents of the United States: George H. W. Bush (1992, Book I)]
[July 31, 1992]
[Pages 1212-1214]
[From the U.S. Government Publishing Office www.gpo.gov]



White House Fact Sheet: The President's Welfare Reform Strategy

July 31, 1992
    In his State of the Union Address, President Bush said his 
administration would help States that wanted to reform their welfare 
systems by granting a quick review of their welfare waiver requests. The 
President today called for additional welfare reform demonstrations and 
legislative changes that would create more flexibility for States and 
localities. The President's plan is detailed in an administration paper 
on welfare reform released today.

The Problem: Welfare Dependency

    Currently there are more than 13 million recipients of Aid to 
Families with Dependent Children (AFDC) benefits, more than 25.5 million 
food stamps recipients, and more than 30 million people on Medicaid.
    The problem addressed by the administration's proposals and paper 
released today is not welfare receipt but welfare dependency. Half of 
all new public assistance recipients will be off the rolls in less than 
2 years. But too many others will be trapped in the system. At any point 
in time, about two-thirds of those on welfare will be on for 8 or more 
years.
    Important determinants of dependency are: teen motherhood; dropping 
out of school; no prior work experience.
    The consequences of dependency can be severe: long-term poverty; 
entrapment in crime ridden neighborhoods; and higher chances that one's 
children will themselves become dependent on welfare.
    These and other facts about welfare receipt and dependency are 
reviewed in a data appendix to the paper released today.

The President's Principles

    The President's fundamental goal for welfare reform is to create 
incentives that will enable welfare recipients to leave the system at 
the earliest possible time, as economically self-sufficient and 
responsible participants in their community.
    At the same time, we have begun to open the doors of opportunity to 
one of the larger groups that has been relegated to welfare dependency, 
individuals with disabilities. The Americans with Disabilities Act, 
which took effect recently, gives these individuals the opportunity to 
gain control over their own lives and compete for jobs on a level 
playing field.
    Federal programs that serve welfare recipients must instill 
responsibility and serve as a ladder of opportunity.

    Accomplishments

    The paper released today reviews the administration's 
accomplishments, which include:
    Expanding the Earned Income Tax Credit (EITC), which will provide an 
additional $18 billion in assistance to low-income working families over 
the next 5 years.
    Implementing the Job Opportunities and Basic Skills Training (JOBS) 
program. Over $1 billion is available this year for job search, 
training, and education services, child care, and more than 500,000 
welfare recipients are participating each month.
    Increasing child support enforcement resulting in over $6 billion 
collected in fiscal year (FY) 1992.
    Expanding the Head Start program to $2.8 billion in FY 1993 for all 
eligible 4-year-old children whose parents want them to participate, an 
increase of 127 percent since the President took office.

    Pending Proposals

    The President's welfare reform proposals that have been pending 
before the Congress include:
    The Community Opportunity Act, proposed in May 1991. This proposal 
would create broad authority to permit testing of

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innovative programs. It would allow proposals to come forward from State 
and local governments as well as grass roots groups.
    Increasing the AFDC assets limit. States would be allowed to raise 
the amount of assets a family could accumulate and still stay on welfare 
from $1,000 to $10,000. Presently, individuals saving for college or to 
start a business may get thrown off welfare. The family's choice: spend 
any savings or lose your welfare benefits.
    Escrow Savings Accounts. A demonstration would test whether long-
term AFDC recipients would be more likely to work their way off welfare 
if, when they did, they received a bonus payment based on foregone AFDC 
benefits.
    Plan for Achieving Self-Support (PASS). States would have the option 
of excluding income used by an AFDC family head to become self-employed 
when assessing whether a recipient qualifies for AFDC benefits.

The President's Proposal

    The President's proposal affirms his commitment to State innovation. 
Welfare waiver requests are being processed rapidly, and promising areas 
of innovation are identified.

    Review of welfare waiver requests

    The President promised a quick review of welfare waiver applications 
in his State of the Union Address. Requests from Wisconsin, Oregon, 
Maryland, California, and New Jersey have been approved; requests from 
Utah and Michigan are under review.
    The ideas included in those waivers include incentives for work and 
family formation, for immunization and obtaining preventive health 
services, and for responsible childbearing and school attendance.

    Areas in need of innovation

    The administration today identified three areas where further 
innovation is important. Those areas are: (1) Providing comprehensive 
services for teen parents; (2) Promoting parental responsibility; and 
(3) Encouraging self-sufficiency.
    Interventions for unmarried teen parents were identified as the 
highest priority. These individuals are the most likely to become 
welfare recipients, especially long-term recipients.

    Legislative changes

    The President called for legislative changes to expand waiver 
authority, provide greater program flexibility, and strengthen programs.
    1. Expanded waiver authority: Waiver authority comparable to the 
broad authority that today applies to AFDC will be proposed for food 
stamps and Federal housing programs. For example, current law does not 
allow for coordinated incentives and rules across cash, food, and 
housing assistance programs.
    Waiver authority will also be proposed to allow the Davis-Bacon Act 
to be waived to allow the homeless and public housing residents to work 
in housing improvement projects. Those homeless and public housing 
residents who are gaining skills while working may not have the 
productivity needed to earn the wages required under Davis-Bacon.
    2. Greater program flexibility: The administration will propose a 
targeted version of the Community Opportunity Act (COA) proposal it 
offered last year. The COA would allow States and communities to 
undertake broad reform programs that cut across multiple program lines. 
The new proposal, the Community Opportunity Pilot Project Act (COPPA), 
would make the authority initially available for projects in five sites. 
For example, the Atlanta Project, a community effort to address the 
problem of Atlanta's most troubled neighborhoods that former President 
Carter has discussed with President Bush, could redesign the operation 
of Federal programs in Atlanta under COPPA.
    Legislation will be proposed to allow greater flexibility to State 
and local officials. The greatest additional flexibility will affect 
work requirements for welfare recipients. The legislative changes will:
    Allow inclusion of food stamps and the value of having Medicaid in 
determining the amount a welfare recipient must ``work off'' as part of 
a workfare program;
    Remove limitations on positions to which welfare recipients can be 
assigned to fulfill

[[Page 1214]]

a workfare obligation;
    Remove prohibitions on extended job search and requirements for 
intake assessment in JOBS, enabling State and local officials to give 
job search higher priority; and
    Allow States to move from a ``cash up front'' to a ``pay for 
performance'' approach for welfare payments, with payment made after the 
performance of assigned program activities such as schooling or job 
search.
    3. Stronger values: The requirement that AFDC recipients cooperate 
in establishing who is the father of their children would be expanded to 
include all relevant information and cooperation with followup efforts.
    Separate and often unnecessarily stricter Federal requirements for 
evicting convicted felons from public housing would be repealed. This 
proposal would defer to local law instead of providing a separate 
Federal requirement for eviction.