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Fewer Colorado Families Living in Poverty Receive TANF Cash Assistance

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Wednesday, January 19, 2022   

Colorado and other states are hoarding more than $6 billion intended for struggling families, according to new analysis.

In 2020, Colorado denied more applications for cash assistance through the Temporary Assistance for Needy Families program than it accepted. Ali Safawi, a research associate at the Center for Budget and Policy Priorities, said many Colorado families with children are not getting the help they need, even though the state has some $87 million in unspent TANF funds.

"So in Colorado, we see that for every 100 families with kids living in poverty, just 20 receive TANF," he said. "That means that 80 families out of that 100 are not, even though they are experiencing poverty and could really use that assistance."

Welfare reforms passed under the Clinton administration, aimed to help families transition to jobs that would end what critics called a cycle of dependency, gave broad leeway to states for how to use TANF funds. In Colorado, TANF distributions vary greatly depending on which county you live in.

Safawi noted that most Colorado families living in poverty already are working, but at jobs that do not pay a living wage. He added that investing in children's well-being pays off down the road. When families have cash resources to meet their basic needs, their kids do better in school, earn better wages as adults and are more financially self-sufficient.

"We know from a lot of research that giving cash to families who are struggling with very low incomes has a significant difference for children," he said, "and these impacts are not just immediate; we see improvements in their health and their economic outcomes well into adulthood."

He pointed to Columbia University research showing that raising a low-income family's income by just $1,000 a year, about $83 a month, creates more than $10,000 in societal benefits. Safawi said one way to get assistance to more Colorado families is to increase qualifying income limits, which are exceptionally low.

"It's $421 a month for a family of three," he said. "That means if they make over that, they don't qualify. We don't really see income eligibility that low anywhere else outside of the Deep South, which has a long history of limiting assistance primarily to Black families."


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