What federal funds are available to support states efforts to prevent welfare dependency?
A number of federal funding streams can support state efforts to prevent welfare dependency. Under federal regulations, states may spend TANF block grant funds on any services that support employment and encourage self-sufficiency among low-income families with at least one child. Examples of allowable expenditures include transportation and child care assistance, housing subsidies, state earned income tax credits, wage supplements, job training, career counseling, and employer incentives. In addition, states can use the funds to provide short-term financial assistance to needy families and for a variety of services targeting at-risk youth. States also may fund these services outside the TANF program using maintenance of effort (MOE) dollars. In addition, federal regulations allow states to fund prevention services by transferring a portion of their TANF block grant to the Child Care and Development and the Social Services block grants (also, see Greenberg, 1999 and Cohen, 2000). State
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