HHS News Release

HHS Secretary Donna E. Shalala today approved a welfare reform demonstration for the state of Florida which makes several major changes to the Aid to Families with Dependent Children (AFDC) program.

"Over the past several months, our department has approved nine other state welfare demonstrations as part of the administration's commitment to state flexibility and experimentation. I am confident the Florida demonstration I am approving today will add to our knowledge of how welfare can most effectively be reformed," Secretary Shalala said.

Under the demonstration, called a "Family Transition Program," certain welfare families in two Florida counties will be limited to collecting AFDC benefits for a maximum of 24 months in any five-year period. Families that lose benefits because of this time limit, and are unable to find employment, will be guaranteed the opportunity to work at a job paying more than their AFDC benefits.

Mary Jo Bane, assistant secretary for children and families, said, "I am pleased we have worked with the state to develop a program that implements a commitment to transitional welfare followed by work."

Major elements of the demonstration include:

*A new requirement that will limit AFDC families to two years of transitional benefits after which they will work. Exceptions to the rule will apply in cases where recipients are not able to work or have very young children. Also, families deemed to be at high risk of long-term welfare dependency could receive benefits for 36 months in a six-year period. Families that lose benefits because of the time limit will enter a "transitional employment" program, in which they will be offered employment in private- or public-sector jobs.

*To encourage work, AFDC families will have the first $200 in monthly income, plus one-half of the remaining amount, disregarded when AFDC benefits are calculated. This represents a significant increase over current earnings disregards.

*Families will be able to accumulate up to $5,000 in assets as well as have up to $8,150 equity in a car so long as the vehicle is utilized primarily for self-sufficiency purposes. Current law limits a family's assets and equity in one automobile to $1,000 and $1,500, respectively.

*Medical care and child care benefits will be extended for families who are in transition from AFDC to self- sufficiency.

*Finally, AFDC parents will need to ensure that their children have been immunized and are regularly attending school. Benefits can be reduced when either requirement is not being met.
Florida's demonstration will include a rigorous evaluation using random assignment to control and experimental groups.

The Clinton administration has previously approved welfare demonstrations for Colorado, Georgia, Illinois, Iowa, Oklahoma, Vermont, Virginia, Wisconsin and Wyoming. Most of the demonstrations include some form of linkage between receipt of welfare to enrollment in self-sufficiency activities.

Note: All HHS press releases, fact sheets and other press materials are available at http://www.hhs.gov/news.

Contact: David Siegel (202) 401-9215