Final TANF Rule as published in the Federal Register 4/12/1999

Federal Register / Vol. 64, No. 69 / Monday, April 12, 1999 / Rules and Regulations
programs. Finally, another commenter
asked us to de-link MOE and TANF
eligibility.
Response: The proposed rule at
§ 273.2(b)(3) provided that an eligible
family must be financially eligible
according to the TANF income and
resource standards established by the
State under its TANF plan. It appears
that commenters interpreted our use of
the plural term, ‘‘standards,’’ to mean
that the elements used to determine
financial eligibility (income and
resources) constituted a single set of
criteria for all the services that a State
would provide. This was not our
intention. We used the term ‘‘standards’’
in the event a State wanted to have
multiple financial requirements based
on the different services that it wished
to provide or the scope of families it
wished to aid.
States have the flexibility to decide
the particular income and resource
requirements that they will use to
determine whether a family is
financially eligible to receive a service,
a package of services, or all of the
services provided with State basic MOE
funds. Thus, both income and resource
requirements may vary, as determined
by the State. For example, a State could
establish different financial criteria for
families no longer receiving TANF cash
assistance in order that family members
may receive transitional services. Or, a
State may want to establish standards
for providing short-term or nonrecurrent
assistance to families in order to prevent
the need for ongoing TANF assistance.
Section 409(a)(7)(B)(IV) of the Act
indicates that an eligible family is a
family who is or would be eligible (as
provided in this section) for assistance
under the State program funded under
this part. The State’s TANF program is
the State program funded under this
part. Thus, there is a statutory link
between MOE and the State’s TANF
program. However, that link merely
requires that an eligible family is or
would be eligible for TANF assistance.
It does not require that eligible family
members must necessarily receive
TANF cash assistance or any other
benefit or services through the TANF
program. Section 407(a)(7)(B)(i)(I) of the
Act permits the State to help eligible
family members through activities in
‘‘all programs,’’ i.e., TANF and separate
State programs.
Comment: Some commenters
mentioned that States should be able to
use basic MOE funds to create programs
with definitions of need that may not
assess income and assets at all. They
argued that section 409(a)(7) allows a
State to claim basic MOE spending with
respect to eligible families for any use
of funds that are reasonably calculated
to accomplish the purpose of the TANF
program. Providing assistance to needy
families is mentioned in only two of the
four purposes of the program under
section 401(a) of the Act. Thus, the term
‘‘eligible families’’ should include a
broader population of families, not just
those who are needy families. Two
commenters, including one national
organization, also noted that the TANF
purposes do not require that spending
has to be made to, or on behalf of, an
eligible family. For example, preventing
and reducing the incidence of out-ofwedlock
pregnancies and encouraging
the formation and maintenance of twoparent
families could involve the
development of materials, pamphlets,
videotapes, and counseling activities
directed at teen pregnancy prevention
and other pregnancy prevention
initiatives. Such expenditures benefit all
TANF eligible families but do not
necessarily benefit any one family in
particular.
Response: As we explained in the
above response, the statute defines MOE
expenditures as those made ‘‘with
respect to eligible families.’’ Thus, it
clearly links MOE expenditures to
eligible families. An eligible family is a
family who is or would be eligible for
assistance under the State’s TANF
program. A family may not receive
‘‘assistance’’ under the State’s TANF
program unless the family is needy. We
interpreted the term ‘‘needy’’ for TANF
and MOE purposes to mean financial
deprivation, i.e., lacking adequate
income and resources. We continue to
believe this is the most appropriate
interpretation and decline to expand the
scope of the definition of needy. Hence,
for basic MOE purposes, eligible
families are those who are financially
eligible according to the State’s
applicable income and resource criteria.
States may establish different income
and resource criteria to cover the scope
of needy eligible families they wish to
serve or the various services or activities
they want to provide. States are free to
design programs involving MOE
activities, including those mentioned by
the commenter, to reach as broad a
population as they choose. However,
only that part of the total expenditures
made on behalf of eligible families who
meet the State’s applicable financial
eligibility criteria counts toward a
State’s basic MOE.
We would like to point out that
Federal TANF funds may also be used
to pay for ‘‘nonassistance’’ activities
(such as those described above) that
meet the purposes of the program as
given in section 401(a)(1)–(4) of the Act
and § 260.20. Federal TANF funds may
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also be used for activities that benefit
non-needy families in some cases, e.g.,
activities that meet the purpose of either
section 401(a)(3) or (a)(4) of the Act. In
this respect, there may be more
flexibility in the expenditures that are
allowable uses of Federal funds than
those that are allowable for MOE
purposes. This is because federally
funded services or benefits do not
necessitate a determination of financial
eligibility (need) if they do not meet the
definition of assistance. Thus, States
may use Federal TANF funds (in
accordance with section 404 of the Act)
to provide ‘‘nonassistance’’ services or
benefits to eligible individuals who
meet the State’s other, nonfinancial,
objective criteria for the delivery of such
benefits.
Comment: Some commenters asked
whether a State must make use of
resource standards, noting that there is
no statutory requirement to do so. Other
commenters noted that the definition of
‘‘needy’’ may or may not include an
asset test. For various benefits, a State
may just establish income criteria to
determine the families who are eligible
for the benefit. One national
organization also indicated that some
States are considering eliminating
resource standards.
Response: Title IV–A of the Act
setting forth the TANF program does not
address income or resource
requirements (except under section
408(f) with respect to deeming an alien’s
sponsor’s income and resources).
Rather, it uses the term ‘‘needy.’’
Although we interpreted ‘‘needy’’ to
mean financial deprivation, i.e., lacking
adequate income and resources, we also
recognize that some State programs may
just involve an income test. Therefore,
we are not requiring States to have
resource requirements. We have
clarified this point in the final rule
under § 263.2(b)(3) by stating that a
family must be financially eligible
according to the appropriate TANF
income and resource (when applicable)
requirements established by the State
and contained in its TANF plan. (We
discuss eligibility criteria in the TANF
plan further in response to other
comments in this section.) In this way,
States not only decide the scope of
families they want to serve, but also the
families most in need of particular
programs or services.
Comment: One commenter noted that,
with respect to resources, a State’s
standard may address cash assets only.
Two commenters indicated concern that
an asset limit that does not allow a
family to own a serviceable and reliable
vehicle to get to work or services is