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Issues & Policy
Crossroads:
Child Care Addendum
Resolution on Child Care
Transfer Rules
Adopted by the
National Council of State
Human Service
Administrators
March 2002
Addendum to
Crossroads: New Directions in
Social Policy
Background
Since the passage of the Personal Responsibility and Work Opportunity Reconciliation Act in 1996, states have more than doubled their spending on child care. Much of this investment has been supported with Temporary Assistance for Needy Families (TANF) money. States may spend TANF money directly on child care. States also have the authority to transfer up to 30 percent of their TANF block grant into the Child Care and Development Fund (CCDF). States increased TANF spending on child care from $189 million in Fiscal Year (FY) 1997 to $4.3 billion in FY 2000, including $2 billion transferred from TANF. TANF funds spent on child care exceeded the entire federal portion of CCDF allocation in FY 2000.
While states have two years to obligate and one additional year to liquidate funds transferred from TANF, the statute is silent as to when that time begins. The current practice is that the year when a state receives the TANF transfer counts as the first year. However, states often receive the TANF transfer as late as the last week of the fiscal year. That one week would then count as one year, as if the transfer was received in the first week of the fiscal year. States have indicated that increased flexibility for TANF transfers would result in an increase in the number of children served and greater investments in quality initiatives.
Policy Statement
The National Council of State Human Service Administrators asks Congress and the administration to grant states two full federal years to obligate and one additional year to liquidate funds transferred from TANF, no matter when in the year they are transferred.