TANF shift for reimbursement (new law)

Federal guidelines for state reimbursement of certain programs allow for the shifting of targets.

Under a new law signed by Gov. Tim Pawlenty April 25, $8.8 million from the state’s Temporary Assistance for Needy Families is shifted to the General Fund for that purpose.

Sponsored by Rep. Thomas Huntley (DFL-Duluth) and Sen. Linda Berglin (DFL-Mpls), the law allows the human services commissioner to:

• claim an amount necessary to meet maintenance of effort requirements for TANF;

• provide any additional amount to meet federal requirements to avoid penalties;

• reduce TANF work participation rates through excess Minnesota Family Investment Program Maintenance of Effort claims; and

• supplement maintenance of effort claims with working family credit expenditures.

According to the Finance Department, federal rule allows states to reduce their work participation rate by claiming more than the minimum required state funds for the TANF program. Under the provision, states can receive an additional reduction to the work participation rate by committing extra MOE funds to the state TANF program.

Huntley said the law will allow for the federal government to give monetary credit to the state for past efforts.

The department needs to amend the federal reports before the end of April to get the credit, said Steve Nelson, budget director for children and family services in the Human Services Department.

Last summer the federal government allowed states to claim more than the minimal required amount of maintenance of effort to get additional credit by reducing the work participation rate targets and avoid penalty on the TANF program, said Nelson.

The law is effective April 26, 2008.

HF3253/SF2564*/CH232