The Impact of Welfare Reform on Child Welfare Financing

range of activities, including investigating alleged incidents of abuse and neglect, protecting victimized children, supporting and preserving families, and assisting children who must be temporarily or permanently removed from their parents’ homes. Child welfare agencies are an integral part of the public social services safety net. They often act as the provider of last resort since state laws assign them legal responsibility for ensuring the safety of all vulnerable children regardless of a family’s income or legal status or the cost of services needed. The landmark welfare reform legislation signed by President Clinton in August 1996 significantly alters this safety net. In replacing Aid to Families with Dependent Children (AFDC) with Temporary Assistance to Needy Families (TANF), the Personal Responsibility and Work Opportunity Reconciliation Act (PRWORA) removed the entitlement for families with incomes below a certain level to receive financial assistance from the federal government. While it made few changes to federal child protection programs specifically, provisions of the legislation have potentially far-reaching effects on the child welfare system. In particular, it may both directly and indirectly affect the financing of child welfare services. This brief explores the implications and potential direct effects of the new welfare regulations on the funds available for child protection programs, states’ ability to collect federal foster care and adoption assistance reimbursements, and state methods for financing kinship foster care.