Welfare cases up, but funds are dwindling

Adrienne Packer

Friday, Oct. 11, 2002 | 11:07 a.m.

A steep increase in statewide welfare cases is expected to drain Nevada's $22 million reserve of welfare funds by June unless the federal government agrees to provide additional emergency money, officials said.

After the Sept. 11 terrorist attacks, Southern Nevada's unemployment rate rose and welfare cases doubled, exhausting Temporary Assistance to Needy Families (TANF) dollars.

The state, which receives federal TANF funds and distributes them to counties, plans to cut Clark County's allotment by 75 percent so the state can continue providing programs and services.

Welfare officials said if the county's portion is not reduced, the state will lose its reserves and fall $6 million in debt.

"We had saved money in case of an economic downturn," said Nancy Ford, welfare administrator for the state's Department of Social Services. "But we didn't realize how long and severe this downturn would be or how much the caseloads would go up."

The county receives about $3.4 million annually that is designated for its child protective service programs. But unless the federal government ups the funds paid to Nevada, the county's portion of TANF money will shrink to $750,000.

"What this means is families won't get what they need," said Susan Klein-Rothschild, director of the county's family services division. "These funds are used to meet people's basic needs: food and shelter."

The loss has county officials once again looking at an unexpected draw from its $735 million general fund. The county tapped into its general fund to help cover $33 million in overrun costs at the Regional Justice Center and will dip into it to bail University Medical Center out of its financial straits.

The county's cut of TANF funds pays the salaries of three Child Protective Services specialists, two specialists who oversee the abuse and neglect hotline and a Child Haven nurse who assesses children for placement.

A portion is also dedicated to providing housing, counseling, food and programs at Child Haven and general operating costs at Child Protective Services.

County administrators haven't determined how they will make up for the loss, but said there will be no layoffs.

"We haven't specifically determined what the impact to the department or the county will be or how we'll handle that," said Susan Laveway, the county's assistant finance director. "It will have an impact, but it's going to have to be analyzed."

State and county officials are engaged in a letter-writing campaign to Nevada's representatives in Washington urging them to enhance welfare funding to allow the state to continue to serve needy families in tough economic times.

Clark County Commissioner Myrna Williams authored a letter to Sen. Harry Reid, D-Nev., last month asking him to tack on a proposal for enhanced funding on the TANF reauthorization bill.

"Nevada needs additional TANF funding to meet the severe situation now experienced by far too many children and families in our state," Williams said.

Nevada's situation is unique.

After the Sept. 11 terrorist attacks, when casinos laid off thousands of employees, Guinn loosened the eligibility guidelines for TANF funds, allowing more families to receive assistance.

Since September 2001, the number of families eligible for TANF funds statewide grew from 8,800 to 13,000.

The TANF fund allotment to the state hasn't been adjusted in six years despite a significant population boom, further burdening the welfare system.

Before welfare reform in 1996, the federal government matched the amount states granted to residents eligible for their Assistance for Families with Dependent Children program.

When the TANF program was enacted, the federal government based TANF grants on state's existing AFDC rates. Nevada's welfare subsidies have historically been low. The frozen rate is about $44 million a year. Nevada also received an additional $3.7 million for being a high-growth state. However, those funds were frozen in 2001.

"That is why we want enhancements to help give us fiscal relief," said Ford, the state welfare administrator. "We are short-budgeted in the TANF program."

According to federal guidelines, the state can use TANF funds to not only provide assistance to needy families, but also to provide job training, programs designed to prevent teenage pregnancies and marriage counseling.

Gov. Kenny Guinn also penned a letter to Sens. Reid, John Ensign, R-Nev., Rep. Shelly Berkley, D-Nev., and Rep. Jim Gibbons, R-Nev.

The governor worked with South Carolina officials to draw up a proposal to amend federal guidelines to provide additional grants to "states with low federal funding per poor person and substantial increase in TANF caseloads."

It also says additional funding should be based on whether the number of TANF families increased by more than 15 percent between December 2000 and December 2001.

If the bill is amended as proposed, Nevada and South Carolina's enhancement would amount to a total of $36 million.

"Nevada is in dire straits and, if additional funding is not secured, faces additional severe cuts in programs," Guinn wrote.