October 18, 2010

Facts or myths? Maine's welfare system in action

By John Richardson jrichardson@pressherald.com
Staff Writer

PERCEPTION: Maine's welfare system encourages people to turn down work or pay raises to avoid losing Temporary Assistance for Needy Families.


Although each case is different, that claim doesn't add up, according to Maine Department of Health and Human Services officials.

The amount of cash assistance a parent receives is based in part on other income. If a parent gets a raise at work, benefits are reduced, but a parent should not lose more in TANF benefits than he or she gains through a raise or additional work hours, they said.

When a parent's earnings exceed the eligibility limit, the cash assistance is cut off. However, TANF provides temporary cash assistance for food, transportation and child care that is gradually phased out. The transitional food benefit lasts three years, declining from $100 to $50 a month.

The transitional benefits are intended to provide more work incentives and help keep parents employed and out of the system, state officials say.


PERCEPTION: Welfare mothers have more children so they can collect more benefits from the state.


It may happen, but not very often.

The average family receiving cash assistance from the state has 1.7 or 1.8 children, according to state data and a recent survey. The average Maine family also has 1.7 children.

It also would be a questionable financial strategy for a family receiving TANF.

The maximum benefit for a mother and two children is $485 a month in Maine. Adding one child to the family would raise the maximum benefit to $611 a month.

Families may receive less than the maximum depending on other income and assets.


PERCEPTION: Maine spends more money on welfare than most other states.


This depends on what you count and how you count it.

Every state provides aid differently, so comparisons are difficult.

The U.S. Census publishes an annual state-by-state comparison of all government spending on "public welfare." But the total combines programs that provide food and shelter and Medicaid, a government health insurance program that is far larger than the others and therefore drives the rankings.

In raw dollars spent on Medicaid and welfare -- $2.5 billion in 2008 -- Maine ranked 33rd nationwide, according to the U.S. Census.

However, as a percentage of the total annual budget -- 30.5 percent -- Maine ranked second after Tennessee (32.8 percent), it said.

When only state and local spending is compared, Maine ranked 10th in spending per resident -- $671 -- in 2007, according to the Census and a University of Maine analysis.


PERCEPTION: Maine is one of the few states that doesn't set any time limit on welfare, so people keep collecting, sometimes for generations.


Nine states, including Maine, allow recipients of Temporary Assistance for Needy Families to get benefits for more than five years as long as they follow the rules, according to the Urban Institute.

Some other states provide waivers to go beyond five years in certain cases, such as a disability, according to Maine officials. Some states also provide benefits to families through separate programs not subject to the same rules and reporting requirements.

Four percent of TANF cases -- about 506 families -- exceed five years, according to the Department of Health and Human Services. Most of Maine's long-term cases involve disabilities, according to the state.

The DHHS could not say how many of the state's long-term cases do not involve a disability, except that it's a minority.

The average time spent on TANF is 21 months, and 85 percent of families leave the program within two years, according to the agency.

(Continued on page 2)

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