The Legislature’s Government Oversight Committee (GOC) voted 8-1 last week to subpoena Office of Independence Director Bethany Hamm after she failed to show up to answer questions as part of an ongoing probe into the LePage administration’s use of surplus money from federal Temporary Assistance for Needy Families block grants. The no-show marks the second time this summer that the committee was forced to subpoena a LePage administration official — Department of Health and Human Services Commissioner Ricker Hamilton also ignored an invitation from the committee in June.

GOC has been examining TANF as part of an investigation by the nonpartisan Office of Program Evaluation and Government Accountability (OPEGA) into how the administration is spending $145 million in surplus cash assistance previously used to aid low-income families after it stopped providing cash assistance to thousands of impoverished Maine families in 2011,.

Under federal guidelines, that money must be spent to promote TANF’s stated objectives, including providing assistance to needy families so that children can be cared for in their own homes; promoting job preparation, work and marriage; reducing out-of-wedlock pregnancies and encouraging two-parent families. Since the LePage administration limited support for the first objective, it began diverting money from cash assistance into job training, programs for at-risk youth, child care services and child abuse protection.

But in 2017, the Bangor Daily News revealed that DHHS unlawfully misused $13.4 million in TANF funds for elderly and people with disabilities and had planned to use at least $34.5 million to replace funding for existing budget obligations. During the July 26 public hearing, anti-poverty advocates questioned why OPEGA didn't examine how much of the TANF surplus money is being used to supplant funding for programs previously supported by general-fund dollars. 

“We believe that this practice of spending down the TANF balance in order to move around other funds does not result in poor families getting any additional benefits from the TANF program, despite the greater expenditure of TANF funds,” said Joby Thoyalil, a senior policy analyst with Maine Equal Justice Partners. “With over 40,000 Maine children in poverty and 81 percent of them not receiving assistance from TANF, we strongly believe such scrutiny would have been warranted to ensure the State is not needlessly depriving children of life-sustaining assistance.”

But What About the Children?

Low-income advocacy groups are also urging the committee to look into what happened to the thousands of families who were kicked off of TANF after the LePage administration imposed a 60-month lifetime limit on receiving TANF benefits in 2011. Since then, enrollment in the program has dropped by a stunning 70 percent.

At the same time, deep child poverty, defined as families earning under $12,500 a year, has increased by 13.6 percent, even as it decreased nationally by 4.2 percent, according to Census data. Before the TANF cap took effect in 2010, 52 percent of Maine kids living in poverty received TANF benefits, but in 2016 only 19 percent of them received assistance, according to a 2016 Maine Kids Count report.

Speaking before the committee on July 26, Claire Berkowitz, executive director of Maine Children’s Alliance, said that children between the ages of 0 and 5 need the most support, as their brains are developing, but that living in poverty can create toxic stress that stunts their development.

“So again I ask, what happened to the children in these families who went from at least having TANF support to no income at all?” said Berkowitz. “Are more children homeless or receiving their meals from soup kitchens?…. Are any of these children victims of neglect and involved in our child welfare system as a result of not having their basic needs met? How has the withholding of cash assistance from children who need the support shifted costs to other parts of government — our child welfare system, our schools, our physical and behavioral health care systems?”

Poverty, Homelessness and Broken Families

So far, only Professor Sandy Butler of the University of Maine’s School of Social Work has closely studied what happened to those families who lost TANF benefits due to the lifetime cap. At the July 26 public hearing, Butler said that respondents to her surveys faced several barriers to employment such as health problems, the need to take care of a sick or disabled family member, low education levels, lack of transportation and affordable child care, and a scarcity of jobs where they lived. 70 percent of them went to a food bank after losing benefits, more than one in three had a utility service cut off, and one in five were evicted and forced to live in a homeless shelter or overcrowded living conditions. For instance, Leo, a widowed 55-year-old respondent caring for his 9-year-old grandson, survived on zero income and without power for three months before he was able to receive Supplemental Security Income (SSI) for a physical disability.

“I didn’t have money for over a year, so everything was so backed up,” he told Butler. “Just trying to get everything caught up is running me ragged.”

Jane, a respondent with three young children, was married to a man with paranoid schizophrenia. After the family’s TANF was cut off, she said his condition worsened, which led him to be frequently hospitalized. Jane worked a part-time job and depended on her husband for child care, but as his illness worsened she couldn’t count on him as much. She didn’t have a driver’s license or the skills to earn a living wage so she worked per diem doing housekeeping at a nursing facility within walking distance.

“The hardest thing is if he gets hospitalized and I don’t have a sitter, I’m forced to call out of work myself, which isn’t good for our financial situation,” she told Butler.

Butler found that two out of five parents she surveyed had a disability that limited their ability to work and one in four had a child or other dependent with a disability. Her earlier 2010 survey had found that 90 percent of the households receiving TANF for 60 months or longer had a disability in the family. However, only 20 percent of families terminated by the lifetime-limit law, when it went into effect in 2012, received a hardship exemption. As a result, the median income of survey respondents was just $260 per month, or about 16 percent of the federal poverty level. 42 percent of respondents had no income at all.

Wendy, a 32-year-old mother of three young children under age 5, had reportedly just started a new job when her TANF was terminated, which meant she lost her child care and travel subsidies. With a 45-minute commute and unable to afford child care, she soon lost her job and the family became homeless. DHHS informed her that homelessness didn’t qualify her for a hardship exemption from the 60-month lifetime TANF limit. She said that two of her children ended up contracting pneumonia at a homeless shelter and had to be hospitalized. When Butler reached out to Wendy again in 2013, DHHS had taken her children away, she was couch surfing and “her highest priority was doing whatever she could to get her children back.”

“Five years have passed since these interviews. I do not know of any more recent attempts to find out how the families who have lost TANF assistance are faring,” said Butler. “We know from DHHS’s own reports that most are not working consistently, nor receiving extensions. We know we have an extremely high rate of food insecurity and child poverty increasing…. I believe we have failed one of the most vulnerable populations in Maine.”

Maybe Throwing Money at the Problem Is the Answer

Not everyone at the hearing thought the TANF cap was a bad idea. Rep. Jeff Pierce (R-Dresden) expressed support for the lifetime limit and questioned whether low-income families would just end up spending the money on drugs.

“Five years is not temporary to me. Temporary to me is 30 days,” said Pierce. “I’m sorry, I’m an employer so when I hire somebody temporarily they’re guaranteed a job for 30 days. A five-year job is a permanent job in my opinion.”

But Claire Berkowitz countered that raising family income through cash assistance is one of the most effective ways to help children. She cited a long-term study of 1,073 children aged 9 through 16 in 11 counties in western North Carolina by Duke University and the North Carolina State Division of Developmental Disabilities, Mental Health, and Substance Abuse Services. Among children studied in the “Great Smoky Mountains Study of Youth” were members of the Eastern Band of Cherokee Indians. After a casino opened on the reservation in 1996, a proportion of the profits, about $4,000 a year, was distributed equally to every member of the tribe, with the funds for children held by the tribal administration until after they finish high school or reach age 21.

Over the next four years, the researchers observed a distinct improvement in the Indian children’s behavioral and emotional well-being. Children who grew up in households benefitting from the cash payments were more likely to graduate from high school, had lower incidences of criminality and had lower rates of substance use disorders into adulthood compared to other children from poor households, according to a 2010 follow-up study published in the American Economic Journal: Applied Economics.

“I’m not advocating to throw money at people,” said Berkowitz. “I’m just saying the importance of income matters.”