Social Impact Partnerships to Pay for Results Act

Floor Speech

The bill which Mr. Young brings to the floor this afternoon concerns five-tenths of 1 percent of the Temporary Assistance for Needy Families program. I want to talk about the other 99.5 percent, and I will address the 0.5 percent--the five-tenths--a little later.

Overall, this legislation perpetuates the myth of compassionate conservatism that was originally spun by George W. Bush. It involves a Republican strategy that we have seen over the last few weeks to block every single Democratic proposal that would reform welfare to work, or Temporary Assistance for Needy Families as it is formally known.

I favor full reform of TANF, to pursue the original objectives of the 1996 welfare reform that I supported to end generational poverty and help poor Americans who are not physically able to work. TANF would permit them to climb up the economic ladder into the middle class while supporting those who are unable to work.

Instead, what we are presented is one modest, unproven social experiment paid for at the expense of poor children. Over the last 20 years, the total resources that are available to get people from welfare to work have steadily declined. Today's legislation is just one more small cut to those resources.

Republicans previously terminated one major part of TANF that helped States with poor populations, like Texas, whacking out $319 million from the program. What we have left with TANF today is about one-third of the purchasing power that it had 20 years ago when we adopted the reform. In Texas, about 1 in 20 children receive assistance from TANF. Folks who need a life vest are instead given an anchor.

While it may have had some initial positive impact, the 1996 welfare law has become an example of a failed Federal block grant program. Through the years, the States have diverted more and more moneys that were intended to support poor mothers finding the education and training that they needed and the childcare and placement services they needed to go out and have the dignity of a livable wage, long-term job, and now the States are spending, on average, 8 cents of every dollar on work and another 16 cents on child care.

To the extent that President Johnson's War on Poverty has not been fully won, much of the responsibility goes to those who refuse to fight, who surrendered at the first obstacle, who engaged in passive resistance, and, in places like Texas, who just abandoned the field of battle when it came to protecting their poorest citizens. Clearly, the social safety net that TANF was supposed to be has become mostly hole and little net.

If this is a poverty trap, as we have heard, it is because our Republican colleagues have shut the door on any efforts to unlock it with the exception of this one bill. Now with their recently announced poverty plan, they want to take the same kind of thinking--these failed block grants--and apply it to the national school lunch program, apply it to Medicaid, and according to one of their exhibits, to everything from Pell grants to cervical cancer, blocking it all together, and then putting the victims on the chopping block.

Beginning last summer, I encouraged now-Speaker Ryan and other Republicans to support a reform, basically saying to them: I know you are not going to give another dime to help the poor, but at least ask the States to use the moneys that they already have from the Federal Government to accomplish the law's original objectives and stop diverting this money to plug budget loopholes. Unfortunately, TANF is still a welfare program, but it is Republican Governors, largely, who are on the dole, who take this Federal money and don't use it for the purposes for which it was originally intended.

Last year, even Speaker Ryan recognized that existing TANF limitations impair the ability of the poor to get the educational opportunities that they need to get good jobs. Five Republicans, including a couple from our committee, offered the Preparing More Welfare Recipients for Work Act, which doubled the time that was permitted for educational training to count as a work activity, and as one of them--our colleague, Mr. Tiberi--said, these commonsense reforms streamline and simplify complicated work requirements, leading to higher enrollment in work or job training programs. It was common sense then, but as soon as it was attacked by rightwing ideologues, they ran away from it.

Republicans could join us in reforming TANF to make it a true pathway to work and into the middle class, but they have declined to do that. Instead of offering a reauthorization, they split TANF up into six pieces that did not continue it. Part of the same package that hasn't been brought to the floor this afternoon are two other bills.

Mr. Speaker, I include in the Record our dissenting views to those bills. Congress of the United States, Washington, DC, May 17, 2016. Dissenting Views for H.R. 2959

What began as a legislative step forward has become a step backward. What did some modest good, now does harm. As introduced, the TANF Accountability and Integrity Improvement Act (H.R. 2959) would have closed a loophole that a few states have created and exploited to avoid providing their state match for the federal TANF block grant. This loophole unfairly misapplies third-party spending as if it were state spending.

The non-partisan General Accountability Office (GAO) has criticized this wrongful approach, which shortchanges poor children and their parents. I fully support the bill's complete closure of this loophole that only a few states exploit to avoid providing their fair share of support for moving their impoverished residents from welfare to work.

Unfortunately, only hours prior to the Committee markup, this bill was amended to do the opposite of what it originally would have accomplished. As amended, it legalizes this unfair loophole by grandfathering in current offenders. Now it does little more than prevent other states from following the leadership of a few pioneers in abuse. Why reward those states who balance their books on the backs of those least able to bear the burden?

According to the GAO, Georgia is the chief offender, with nearly 60 percent of its TANF contributions coming from private entities. Not only is it not making its proper match to access federal funds, but Georgia also consistently ignores the needs of its poorest citizens. For every TANF dollar, Georgia uses 80 cents for in ways that ignore the core purposes of TANF--work, direct assistance and child care.

The Department of Health and Human Services (HHS) should have already initiated action to close this unjustified loophole. As amended, the bill would now prevent HHS from collecting this abuse. It should be rejected. Lloyd Doggett. Jim McDermott. ____ Congress of the United States, Washington, DC, May 27, 2016. Dissenting Views for H.R. 2952

The Committee has considered multiple bills regarding Temporary Assistance for Needy Families (TANF) without actually extending TANF, which expires in four months. The reason for so many different TANF bills and a refusal to consider an extension in Committee is to block Members from offering genuine reforms of TANF designed to make it function more effectively, to avoid state diversion of TANF funds away from core TANF purposes, and to do more to help TANF recipients move into good, sustainable jobs. This is accomplished through a maneuver claiming that any significant reform that any member proposes is not germane to any of the narrow bills in question. Indeed, the Committee refused to consider an amendment that would simply have extended the expiring TANF program for another fiscal year on grounds that it was not germane.

This particular part of the Republican TANF package concerns data on wages and employment status, but unfortunately a belated amendment to it would make that data a less accurate measure of the effectiveness of State efforts to move people into work. The revised bill manipulates numbers, creating the misimpression that those who cannot work because of age or disability refuse to work. Furthermore, this bill does not provide a measure of the percentage of those leaving TANF who have found work. It would be insightful to learn whether a state has simply forced an individual off TANF or actually helped them to secure a job through which they can support their family.

We strongly support an accurate employment outcomes measure that can offer insight regarding whether state programs are really malcing a difference in moving people from welfare to real, wage-paying, longterm employment and providing opportunity for individuals to work their way out of poverty. This bill's flaws undercut that goal, and unfortunately the Majority rejected an amendment that would have corrected these shortcomings. Representatives Sander Levin, Charles B. Rangel, John Lewis, Xavier Becerra, Bill Pascrell, Jr., Lloyd Doggett, Jim McDermott, Richard E. Neal, Earl Blumenauer, John B. Larson, Ron Kind, Danny Davis, Mike Thompson, Joseph Crowley, Linda Sanchez.

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Mr. DOGGETT. Mr. Speaker, I would say that what we have here is an attempt to also add by amendment the very reauthorization that I sought to offer in committee that was blocked then. I guess today will be the first time even our Republican colleagues learn what has been done with this authorization.

Overall, what we have had is a Republican roadblock to real welfare reform and poverty reduction that this Congress should be focused on, and it obviously will take a new President and a new Congress to do it. Like the compassionate conservatism of George W. Bush, Republicans are offering us a slogan, not a solution.

The same day that they rejected our efforts to deal with this issue, they were all about more tax breaks. Their poverty agenda is a collection of retreads that offer little hope for change. It only demonstrates that their approach to poverty is indeed impoverished.

I salute and appreciate the commitment of Mr. Young and Mr. Delaney to seek new ways to try to combat some old problems. We need creativity to address these challenges. There is no one single approach that will solve all these problems. Where I disagree with them is over how they choose to fund this initiative--a choice that I think they probably personally did not make--and the lack of safeguards to assure their very laudable objectives.

This bill takes money that has always been dedicated to benefit vulnerable children away from the Department of Health and Human Services and authorized its expenditure for other purposes that may be very well intentioned, but that have absolutely nothing to do with vulnerable children.

Now is not the time to further reduce this funding for needy children just because it happens to be an easy place to take money from. It is only $100 million, only five-tenths of a percent of the total TANF budget, but I can tell you that it is hard to come by $100 million to do anything to try to help vulnerable children, and it is a loss to have that money taken away.

It is true that President Obama finally, after almost 8 years of his administration, proposed that the contingency fund be repurposed and that money be added to family assistance grants and require the States to use more of the resources they get from TANF for the purposes of TANF to prevent two-generational poverty. The President's approach was to use the TANF contingency fund for a pathway to jobs initiative and a generational poverty initiative, not to take it out for other purposes. Today, this contingency fund is simply viewed as the easiest place to get money for what is not an evidence-based approach, but may still have merit.

In committee, I sought to protect at least some of these moneys for children. I appreciate the fact that Mr. Young and Mr. Delaney have been receptive and have incorporated in the amended version today a measure that will assure that at least half of the money taken away from TANF is allocated for children, with the focus being on helping those poor children who would otherwise have benefited from the money had it stayed with TANF.

Social impact financing offers the potential of greater private investment and resources to tackle some of the serious social ills that our country confronts. Without approving any new legislation, there is no restriction right now on any of our States from going out and using TANF money for social impact financing, so long as they focus on the statutory purposes of TANF. If these laboratories of democracy can do it already, then I think that is probably sufficient.

I do know that there are a number of young entrepreneurs with a social conscience--a number of them I have talked with in Austin, Texas--who want to apply their talents to resolve ills that they see around them. There are a number of feasibility studies already underway in Austin concerning some of the problems that we have in Texas.

But not everyone who applies for these funds will have the outlook of Mr. Young, Mr. Delaney, some of our colleagues who have come to the floor, and some of these young entrepreneurs because, unfortunately, with the starving of our social service and educational sector, one community after another is so desperate for funds to fight child abuse or neglect that they are willing to do almost anything that they might be sold upon.

Therefore, Mr. Speaker, I will include in the Record a list of safeguards that I hope the gentlemen will consider as this bill proceeds to the Senate.

In designing a new program with $100 million in taxpayer funds, which is designed to ultimately attract many additional taxpayer funds, to an initiative that is not evidence-based, we need to ensure that those dollars are not squandered. And after the Wall Street bailouts, many Americans question whether Wall Street is the place to turn to address social challenges. We have to consider the possibility of the unscrupulous offering false hope to a desperate local community.

In Committee, I raised a list of questions about the lack of adequate safeguards. A state or locality may encounter substantial costs in administering the programs, between fees owed to intermediaries, service providers, evaluators and the like. This bill caps the amount that may be expended on feasibility studies to evaluate a social impact financing proposal, but it places no cap on underwriting costs, which Wall Street firms can charge. The bill puts no limit on the returns an investor can gain in one of these projects. It has no limit on who can determine what ``success'' is in one of these proposals. This bill fails to require a clear cost/benefit analysis that includes as a cost the cost of any related feasibility study.

Even without proper safeguards, it is far from certain how many proposals will actually qualify for funding under this bill. Indeed, the Congressional Budget Office notes that ``because there is uncertainty as to the extent states conducting the projects will achieve the measurable outcomes required for federal reimbursement, CBO estimates that not all of the funds reserved for the program will be spent.

House Republicans have been so eager to gain approval of any new idea they can claim responds to poverty and related social needs that this proposal has emerged without careful evaluation. Hopefully, the Senate in its legislative process can correct some of these shortcomings, and the Treasury and the Office of Management and Budget can include additional safeguards in implementing this measure.

I yield back the balance of my time.

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