The Temporary Assistance for Needy Families (TANF) block grant provides federal grants to the 50 states, the District of Columbia, and territories (referred to collectively as “states”), as well as Indian tribes. While historically most associated with family cash assistance, TANF is a broad-purpose funding stream that helps jurisdictions provide a variety of activities such as early childhood education (including child care subsidies), tax credits for families with children, employment-related activities, child welfare services, youth initiatives, short-term benefits, out-of-wedlock pregnancy prevention, and responsible fatherhood and healthy marriage programs. The Personal Responsibility and Work Opportunity Reconciliation Act (PRWORA, P.L. 104-193), enacted in 1996, ended the preceding cash assistance program for needy families with children—Aid to Families with Dependent Children (AFDC)—and several related programs, folding their funding into the TANF block grant. This report is one in a series of CRS reports focused on PRWORA in light of the upcoming 30-year anniversary of its enactment. The federal government first provided permanent federal funding to support state-run family cash assistance programs in 1935. Over the following decades, many reforms to this policy were considered and sometimes enacted; they were often related to concerns that providing cash benefits to single mothers might disincentivize paid work and marriage. In 1996, PRWORA transformed federal policy regarding family cash assistance and related activities by creating TANF. Some of the major changes introduced by this reform included establishing the new purpose for the block grant of increasing state flexibility in operating state programs; capping federal funding and fixing the allocation of funds to states and their required nonfederal contributions according to mid-1990s expenditure patterns; allowing funding to be used for a broader range of activities and services (“any manner that is reasonably calculated to accomplish” the TANF statutory purpose); placing a time limit on federally funded assistance; and allowing states to meet work performance standards through caseload reduction, unsubsidized employment, and specified job preparation activities. The creation of TANF reflected policymakers’ concerns about the social conditions and cash assistance programs of the 1980s and early 1990s. Since the enactment of PRWORA, changes to federal TANF policy have been infrequent and often narrow in scope, leaving program funding and other policies largely unchanged. Over the same period, there have been significant changes to the social, economic, and demographic context of low-income families with children, while states have used the considerable flexibility provided under TANF to develop widely varying programs. TANF funding levels generally remain tied to pre-1996 circumstances and have not been adjusted for subsequent circumstances such as inflation or shifts in state populations. As a result, federal and state-required financial contributions are fixed to historical spending patterns and vary considerably by state, the purchasing power of the TANF block grant has declined by half due to inflation since it was created, and states have experienced varying declines in federal support due to changes in state populations over time (e.g., as measured by federal funding per poor child in inflation-adjusted dollars). TANF statute gives states considerable flexibility in designing and administering their TANF programs, including what activities are funded under TANF. While TANF is historically most associated with cash benefits, assistance (predominantly cash aid) accounted for less than 24% of federal and nonfederal expenditures in FY2024. As of December 2025, there were less than 924,000 families receiving TANF assistance nationwide, concentrated in a small number of states. Instead, the bulk of expenditures in most states is directed toward other types of benefits and services besides cash assistance. Most TANF requirements only apply when federal or nonfederal funds are spent on assistance to needy families with children. Fewer rules apply to the broader range of other activities that may be funded by either federal or nonfederal dollars under TANF, and data on who receives those other types of benefits and services are limited.
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