HHS News Release

HHS Secretary Donna E. Shalala today announced the award of $100 million in new bonuses to four states and the District of Columbia for achieving the nation's largest decreases in out-of-wedlock births between 1994 and 1997. This is the first award of the bonuses for reduction in out-of-wedlock births, as provided for in the welfare reform law of 1996.

The awardees are Alabama, California, the District of Columbia, Massachusetts and Michigan. Each will receive $20 million. Under the 1996 law, a total of $100 million will be available annually.

"The welfare reform law transformed the welfare system not only by requiring work and parental responsibility, but also by focusing on reduction of out-of-wedlock and teen births," said Secretary Shalala. "This is an important way to help reduce the risk of welfare dependency, and we're pleased to be making this first award of bonuses to these states and the District of Columbia."

Under the law, the annual bonuses are to be awarded to as many as five states with the largest reduction in the proportion of out-of-wedlock births to total births. HHS compiles the statistics reported by states and compares the proportion for the most recent two-year period to that for the preceding two-year period. For this year's bonus, rankings were based on birth statistics from 1994 and 1995 compared to 1996 and 1997. The top five states become potentially eligible for the bonus. In order to receive the bonus, the five states then must then also show a decrease in their abortion rate between the most recent year and 1995, where the abortion rate is measured as the number of abortions divided by the number of births.

The reductions achieved by today's bonus awardees were -- California, 5.7 percent; District of Columbia, 3.7 percent; Michigan, 3.4 percent; Alabama, 2.0 percent; and Massachusetts, 1.5 percent.

More evidence is needed to fully understand the range of factors contributing to the decrease in the proportion of out-of-wedlock births in these particular states. Three of the four years covered under the first bonus predate enactment of the welfare reform law in August 1996, which required all states to develop strategies and goals for reducing out-of-wedlock births as part of their state welfare reform plans. However, even before enactment of the 1996 law, some states began encouraging parental responsibility under the welfare reform waivers that the Clinton Administration granted to 43 states. HHS expects that the data reflected in future award years may reflect the increasingly focused efforts of the states as they have an opportunity to implement new or expanded programs to compete for the bonus.

"This bonus marks the first time the federal government has provided an incentive to states to reduce out-of-wedlock births," said Olivia A. Golden, HHS Assistant Secretary for Children and Families. "States are eager to compete for the bonus and we look forward to continued results of their efforts as they use the flexibility and resources provided by welfare reform."

The full list of states and the percentage change in out-of-wedlock birth rates is available on the World Wide Web at http://www.acf.dhhs.gov/news/press/1999/oowstate.htm.

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

Contact: Michael Kharfen, (202) 401-9215