Illinois Votes to Eliminate the TANF Asset Test

May 21, 2013
IABG

CONTACT:
Lucy Mullany
Coordinator, IABG & Senior Policy Associate, Heartland Alliance
lmullany@heartlandalliance.org
312.498.8614

 

ILLINOIS SENATE PASSES BILL TO HELP POOR FAMILIES SAVE

SAVINGS TO STATE NEARLY $1M EACH YEAR

 

CHICAGO –  Today the Illinois Senate passed legislation that saves our state nearly $1 million annually, while removing a significant barrier that prevents Illinois’ poorest families from saving money.  HB2262, which passed out of the House with bipartisan support last month, will eliminate the “asset test” in the Temporary Assistance for Needy Families (TANF) program, commonly known as “welfare.” 

 

The “asset test” is part of the eligibility standards for TANF in Illinois, and means that a family of three, seeking TANF assistance or currently receiving assistance, cannot own more than $3,000 in savings. Without emergency savings families are unable to pay for car repairs, emergency healthcare, or unexpected child care expenses. They are left financially vulnerable and even more in need of public assistance.

 

Sponsored by Representative Gabel and Senator Hunter, this legislation encourages savings and will allow families to gain financial independence.  The bill now heads to Governor Quinn’s desk for his signature.

 

“The TANF Asset Test has prevented our poorest families from building the savings they need to weather unexpected expenses and become financially stable. By eliminating the asset test we save the state in much needed administrative costs and allow families to preserve the few resources they have, like emergency or college savings, and avert financial disaster,” remarked Lucy Mullany, coordinator of the Illinois Asset Building Group, a program of Heartland Alliance.

 

In addition to harming families, the TANF Asset Test was also unnecessarily costing the state. The Illinois Department of Human Services (IDHS) estimates it spent $960,000 worth of caseworker time checking TANF families’ assets last year. Of the 192,000 individual TANF eligibility reviews conducted last year, IDHS found only 8 cases where the family’s assets exceeded $3,000.

The TANF Asset Limit is a relic of the time before welfare reform when there was no work requirement. The strict work requirements and time limits that define the TANF program today deter anyone with alternative means from applying for assistance. TANF recipients are now required to participate in work-related activities for 30 hours per week. Given these built in deterrents, asset limits have become outdated, unnecessary, and harmful for families.

 

“The legislature has taken an important step today to help low-income Illinoisans begin to build savings and move toward financial security. We hope this is a first step in expanding savings opportunities for Illinois families,” said Ms. Mullany.

 

Efforts to eliminate the TANF Asset Test were led by the Illinois Asset Building Group, a program of Heartland Alliance, and its lead partner organizations, the Sargent Shriver National Center on Poverty Law, and the Woodstock Institute. 

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The Temporary Assistance for Needy Families (TANF) Program provides cash assistance to families living below 50% of the federal poverty level. It is intended to cover all of a family’s non-food expenses, including rent, utilities, clothing, gas, and other essentials. The monthly TANF grant for a family of 3 is $432, enough to support the family at 1/4 of the Federal Poverty Level.

 

The Illinois Asset Building Group (IABG) is a statewide coalition committed to increasing access to the tools people need to build financially secure futures for themselves and their children.  Our work across issue areas includes examining barriers and solutions to the persistent racial wealth gap. IABG is lead by Heartland Alliance for Human Needs and Human Rights. Our partners include community leaders, service providers, researchers, advocates, and financial institutions. For more information visit http://www.illinoisassetbuilding.org/ or follow us on Twitter at http://twitter.com/ILAssetBuilding or like us on Facebook at https://www.facebook.com/IllinoisAssetBuilding.

 

Heartland Alliance −− the leading anti-poverty organization in the Midwest −− believes that all of us deserve the opportunity to improve our lives. Each year, we help ensure this opportunity for more than one million people around the world who are homeless, living in poverty, or seeking safety. Our policy efforts strengthen communities; our comprehensive services empower those we serve to rebuild and transform their lives.  For more information, visit: www.heartlandalliance.org or follow us on Twitter at https://twitter.com/heartlandhelps or like us on Facebook at https://www.facebook.com/heartlandalliance.  

 

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