Changing Participation in Food Assistance Programs Among Low-Income Children After Welfare Reform
by
Jessica Todd,
Constance Newman, and
Michele Ver PloegEconomic Research Report No. (ERR-92) 38 pp, February 2010
The 2008 poverty rate for children (19 percent) exceeded the
poverty rates for working-age adults (12 percent) and the elderly
(10 percent). Many federally funded assistance programs target
low-income children with food assistance, cash assistance, tax
credits, health insurance, child care, and housing. Even after the
value of benefits from these programs is counted, about one in
seven children still lives in poverty. Historically, Aid to
Families with Dependent Children (AFDC) formed the base of public
assistance to poor children, while the benefits from other programs
filled in gaps for specific needs like food and health insurance.
In 1996, the safety net for poor households with children
fundamentally changed when the Personal Responsibility and Work
Opportunity Reconciliation Act (PRWORA) replaced AFDC with
Temporary Assistance for Needy Families (TANF). TANF eliminated
entitlement to welfare and gave States broad flexibility in setting
eligibility criteria. A particular focus of the reforms was to
encourage work.
What Is the Issue?
In the wake of declining cash assistance to families with
children, did families rely more heavily on food assistance
programs? This study investigated participation in, and benefits
received from, AFDC/TANF and food assistance before and after
PRWORA for children in low-income households (income below 300
percent of the Federal poverty line). The food assistance programs
examined include the Food Stamp Program (FSP), the National School
Lunch Program, the School Breakfast Program, and the Special
Supplemental Nutrition Program for Women, Infants, and Children
(WIC). The study also explores how program participation and
benefit amounts differed depending on the pretransfer income (that
is, income before receiving benefits) of the child's household.
This investigation provides a comprehensive view of program
interaction and an understanding of how combined aid from food
assistance and AFDC/TANF cash assistance has changed over time for
low-income children.
What Did the Study Find?
Declining participation in the Food Stamp Program among
children in poor households. Between 1990 and 2004,
participation in the Food Stamp Program among children in the
poorest households (pre-transfer income below 50 percent of the
Federal poverty line) fell from 74 percent to 61 percent.
Participation was even lower in 2001, at 54 percent. In contrast,
participation among children in households with higher income
increased.
Increasing participation in school meals and WIC.
Participation in the school meals program and WIC increased more
than 20 percentage points between 1990 and 2004 for children in
low-income households with pre-transfer income of 100-185 percent
of the Federal poverty line. Among all children in low-income
households, participation in the school meals program increased
from 28 to 43 percent and participation in WIC increased from 7 to
15 percent.
Increasing participation among children in households
receiving at least one assistance program. Although there was
declining participation in AFDC/TANF, rising participation in food
assistance programs resulted in an increase in the share of
children in households that received either AFDC/TANF or any food
assistance program from 35 percent to 52 percent between 1990 and
2004.
Declining average household resources for children in the
poorest households. Children in the poorest households-with
pre-transfer income below 50 percent of the poverty line-saw total
household resources fall between 1990 and 2004. For this group,
while participation and benefits from school meals, WIC, and
nonfood assistance programs increased, participation in and
benefits from both AFDC/TANF and FSP declined so that overall total
combined inflation-adjusted benefits from AFDC/TANF and food
assistance programs declined over $250 per month. Increases in
earnings and other income offset only a small portion of the
decline in assistance benefits.
Increasing average household benefits for children in
households with income above the Federal poverty line. In
contrast to children in the poorest households, children in
low-income households (income above the Federal poverty line) saw
rising total household benefits from assistance programs. This rise
was mainly due to increases in food assistance benefits,
particularly from school meals and WIC. Overall, total household
resources for children in households with pre-transfer income above
the poverty line remained unchanged or increased slightly over the
period.
Less moving in and out of food assistance programs.
Turnover rates for food assistance programs declined. Turnover
rates show the number of children in households that received
benefits from a given program at any time during the year divided
by the average number of such children in a month. The decrease
suggests that these programs are used increasingly for longer term
support. In contrast, the turnover rate for AFDC/TANF cash
assistance increased. This increase, together with the drop in the
number of low-income households with children receiving AFDC/TANF
cash assistance, indicates that TANF is used more often for short
periods.
How Was the Study Conducted?
ERS researchers used data from the 1990 and 2001 Survey of
Income and Program Participation (SIPP) panels, which were
collected during two periods of similar economic growth and
unemployment, to describe changes in program participation before
and after PRWORA. The analysis was supplemented using the most
recent data available, the 2004 SIPP panel. The sample included all
children observed for a full year who lived in households with
income that ever fell below 300 percent of the Federal poverty line
during the observation year. Children were grouped into one of six
groups based on their household's pre-transfer income relative to
the Federal poverty line for their household.