Help Wanted

y all accounts, welfare reforms passed into law in 1996 have been a huge success. Even as the economy has struggled, welfare rolls remain low. Poverty rates are down. Millions have moved into the workforce, many for the first time.

But in December 2000, Carla Preston was not one of them. A 32-year-old mother of three living in inner city Philadelphia, Preston had been in and out of factory jobs. She'd been on public assistance for two years and, she says, "I wasn't paying my bills or my rent." The federal time limit of five years on benefits and the requirement that welfare recipients work 20 hours a week prompted many of Preston's peers to move into the workforce. But these inducements didn't work in her case. Neither did the routine job search programs to which welfare recipients are first assigned.

Preston was among what welfare administrators call the "hard to serve" population: long-term welfare recipients who don't readily adapt to work. Many of the hard to serve face significant obstacles to employment, including education deficits, drug addiction, domestic violence, and physical and mental disabilities. And cities such as Philadelphia, more than the suburbs, have found that those who remain on their rolls often face one or more of these barriers.

For city welfare administrators, assisting these longtime recipients is an intractable problem. The Administration for Children and Families oversees the Temporary Assistance for Needy Families (TANF) program, the system of federal block grants to states that Congress adopted in 1996. In an effort to identify good solutions to problems moving longtime recipients off welfare, ACF has hired the New York City-based Manpower Demonstration Research Corp. to conduct a multiyear evaluation of the myriad programs set up to assist them. ACF also has established the Urban Partnership Program to help cities share best practices. Last year, the agency hired Caliber Associates, a Fairfax, Va.-based consulting firm, to provide cities with technical assistance.

"Urban areas are now working with an even larger proportion of the TANF caseload, and while these cities have done well, they face considerable managerial challenges in helping large numbers of families who have severe and often multiple life problems," says Wade Horn, head of ACF.

TRANSITIONAL JOBS

For Preston, help came in January 2001 when a welfare caseworker referred her to the Transitional Work Corp. (TWC), a Philadelphia-based nonprofit agency set up by the city and state governments to help the hard to serve. More than two years later, Preston is steadily employed. She earns $24,000 a year. "I have a bank account for the first time in my life," she says. "And I don't have to depend on public assistance."

Preston credits the TWC's transitional work program with turning her life around. TWC employees trained her in Microsoft Excel, PowerPoint and Word. She had one-on-one contact with teachers and could come back after 5 p.m. for extra help. "Most of us hadn't even seen a computer," she says.

TWC set Preston up with a paid transitional job working part time as an administrative assistant at the Philadelphia AIDS Consortium, a nonprofit group that provides services to people living with AIDS and HIV. She worked there Mondays through Wednesdays, processing invoices, entering data and preparing letters. TWC, using federal Labor Department welfare-to-work grants and TANF funds, paid her salary. She returned to TWC on Thursdays and Fridays for more computer training. In July 2002, the AIDS Consortium hired Preston full time.

Local welfare administrators and activists concerned about the hard to serve are increasingly rallying around transitional job programs such as those provided by TWC. About 35 such programs exist in cities and counties across the country. Four states, including Pennsylvania, have launched statewide programs. And with Congress slated to reauthorize the 1996 welfare reform bill this year, the cheerleaders for transitional jobs are hoping that even in a tough economic climate, the federal government will provide some dedicated funding. It might happen: A bipartisan group of senators has expressed support for the programs. Sens. Jeff Bingaman, D-N.M., and Arlen Specter, R-Pa., last year proposed spending $200 million a year for five years on transitional job programs.

A House reauthorization plan passed in February did not include earmarked funding. But the programs appeal to senators because they would fit within tighter work requirements proposed by the Bush administration.

Ron Haskins, a former congressional aide who helped draft the original welfare reform legislation, and who last year advised the White House on its reauthorization, has visited the Philadelphia program and calls it first-rate. "What I like about that organization is that they work with everybody who comes to them," adds Haskins. "In this whole field of welfare-to-work, programs are notorious for ignoring the bad cases, taking the good, and then claiming credit. These guys take everybody."

But if Congress does decide to embrace the transitional jobs model this year, a recent General Accounting Office report outlines some questions that will have to be answered, most importantly: What is the federal role in overseeing private welfare contractors hired by local governments to provide services?

Localities are increasingly relying on nonprofit and for-profit contractors to carry out their welfare-to-work missions. In most cases, it seems, the programs have done well, and stories such as Carla Preston's are numerous. But even as transitional job programs succeed, the GAO reports that at least one-quarter of states are not adequately monitoring outside contractors.

Haskins says the federal government should encourage more localities to adopt transitional job programs, but he says the programs must be evaluated thoroughly.

REAL WORK

Though no such evaluation has been done, the policy research organization Mathematica last year completed a smaller-scale survey of six transitional job programs in different parts of the country. The author of the report, Mathematica's LaDonna Pavetti, acknowledges that her study was too small to make any definitive statement, but she did find that at least 84 percent of those who finished the programs went on to unsubsidized employment.

If transitional jobs are the answer to helping the hard to serve, the reasons are not complex, according to advocates. A transitional job allows people with little work experience to develop job skills, and learn basic work etiquette in a supportive environment. Though the boss may be more lenient, the transitional job still feels a lot like real work. Unlike those in workfare programs, which are based on unpaid community service, transitional workers receive paychecks, complete with withholding for payroll taxes. They are given sick days and holiday time, and often, benefits. Expectations are higher as well.

David Butler, a researcher at the Manpower Demonstration Research Corp., says transitional job programs have been promising, while workfare has failed to impress evaluators. Nonetheless, some states have implemented workfare programs in which participants perform community service in exchange for welfare benefits. Extensive analysis of workfare programs in the 1980s, Butler says, showed that relatively few participants found permanent employment.

But nowadays, Butler says, most programs aimed at the hard-to-serve use neither model. Rather, most concentrate on reducing barriers to work by providing training, counseling or rehabilitation without a strong work component. That will have to change if President Bush's proposal to significantly boost welfare work requirements becomes law this year. Bush's plan would increase the time that welfare recipients have to spend at work each week from 30 to 40 hours. Recipients still could opt to spend 16 of those hours in productive outside activities such as job training, drug rehabilitation or remedial education programs. The House in February passed a reauthorization bill that mirrors the president's proposal, but some senators strongly oppose the new requirements.

The Transitional Work Corp., like most of the other transitional job programs, accepts only welfare recipients who've failed to find work after taking an introductory job search course, or who have been on the rolls for two years or more. Most states put welfare recipients through a job search course that teaches them how to prepare a resume, dress for an interview and respond to questions. Some of the programs, including TWC, have developed a network of employers to provide transitional employment.

Andrew Bush, director of the Office of Family Assistance at ACF, resists the notion that transitional job programs are the only way, or even the best way, to assist the hard to serve. He strongly endorses the principle of state flexibility and says that states, even absent a dedicated funding stream for transitional job programs, already have the option of spending their TANF block grants on such programs. He does endorse the conceptual underpinning of the transitional job programs: that every participant is capable of working.

And Haskins, who expresses more enthusiasm for the transitional jobs model, says that the programs work because "you have people in actual situations that they would experience on a daily basis in the workplace, where they have to deal with the supervisor and the customer."

In the typical program, each transitional worker starts off spending a few weeks in training, often learning computer skills while going over the basics: the importance of showing up to work on time and scheduling absences, that customers must be treated with courtesy and fellow employees with respect.

Many welfare-to-work programs aimed at the hard to serve take the "philosophy that you guys have problems, and you've failed out of all these programs, and have a million barriers," says Richard Greenwald, executive director of the TWC in Philadelphia. "We come in with a different perspective. We expect that our participants can work and will work. But we're here to help them."

After the training ends, participants are placed in the transitional jobs, typically at local nonprofits such as the AIDS Consortium in Philadelphia, or local government agencies. Only a few of the programs use private employers. A liaison from the transitional job program serves as an advocate and intermediary between the worker and the employer. And the transitional worker continues to spend about 10 hours a week in training. The transitional period lasts six months to a year, after which the worker typically finds paid, unsubsidized employment.

"The positive thing about a transition-al job is that it is paid work," says Julie Bosland, program director for the Institute for Youth, Education & Families at the National League of Cities. As a result, she adds, these programs have found wide bipartisan support from liberals interested in poverty reduction, and conservatives who strongly advocate a "work-first" approach to welfare reform.

Elise Richer, a family policy analyst with the Center for Law and Social Policy, a Washington-based welfare advocacy group, says the programs are gaining more interest as skepticism about workfare has grown. If the Bush reauthorization plan is enacted, states will need to put substantially more welfare recipients to work, and transitional jobs would help them do it. Under the Bush plan, 70 percent of welfare recipients would have to work 24 hours each week. Currently, only 25 percent of recipients meet that threshold. In many cases, workfare programs would be the only other option. But, says Richer, "With workfare, the policy-makers see massive, centralized programs with jobs people don't really want and employers stuck with people they don't really need. Transitional programs avoid those pitfalls."

In addition, many state and local welfare offices require contractors overseeing transitional job programs to sign performance-based contracts. The contractors get paid only if they achieve promised results. That's a positive development, since welfare contracting has become a big business. Contracting now has been instituted in almost every state and accounts for $1.5 billion in state expenditures, or 13 percent of total welfare spending.About 75 percent of the contracts go to nonprofits such as Goodwill and Catholic Charities. The other 25 percent goes to private companies, such as Reston, Va.-based Maximus Inc.

Contractors provide services including education and training, while helping welfare recipients find and keep jobs.

In interviews with Government Executive, no state administrators expressed concern about the contracting, but some activists have raised questions. Karen Czapanskiy, a lawyer with the Family Investment Program Legal Clinic in Baltimore who provides legal aid to welfare recipients, said she's seen some "really good programs, and others that don't seem to lead anybody anywhere." Her main concern is that Baltimore welfare officials have never explained "how the city evaluates these programs, or determines who to fund, or not to." Officials with the Baltimore City Department of Social Services did not return calls seeking comment.

Still, Czapanskiy is encouraged that Baltimore was one of the cities selected to participate in the Administration for Children and Families' Urban Partnership Program, and that the city is working with the National League of Cities to launch a transitional job program. "The problem in Baltimore is that people are repeating the same entry-level job search programs over and over," she says. "You should only go through that program once, and if you don't get a job quickly, you should move to a more intensive program."

In a June 2002 report, the General Accounting Office found that states and the ACF could significantly strengthen their oversight of welfare contracting. A GAO audit of state oversight found that more than a quarter of states failed to adequately oversee their contractors. As of 2000, for example, Louisiana had failed for seven straight years to ensure that contractors were audited in accordance with federal and state regulations. The GAO identified more than $250,000 in questionable payments.

And even in states that have implemented performance-based contracting, GAO found that many contractors had failed to meet performance goals. Officials at the Health and Human Services Department-which oversees the ACF-responded in a letter that they were not aware of the extent and nature of the problems. In addition, the department argued that "there is some question as to whether it is appropriate under the current TANF statute, with its clear emphasis on state flexibility, to assume substantial new federal responsibilities that could interfere with state methods of monitoring subrecipients and contractors."

The ACF's Bush says he strongly supports evaluation, but believes that states are in a much better place than the federal government to conduct it.

In the meantime, more transitional job programs are sprouting across the country. The National League of Cities' Bosland has teamed up with TWC, the Center for Law and Social Policy, and the Transitional Jobs Network-an association of transitional job programs across the country-to promote the model.

PROMISING, BUT EXPENSIVE

Bosland says that no comprehensive study has proved definitively that transitional job programs are the best strategy, but she believes the anecdotal information is persuasive. Half of TWC's 4,253 clients have gone on to permanent employment. Other programs have found similar success. Former participants in Washington state's Community Jobs program, for example, have an average salary that is double what they earned prior to entering the program. (Many welfare recipients earn some money-the 1996 welfare reform bill requires recipients to spend 20 hours per week in a job, and 10 hours in training, education or rehabilitation programs.)

The Center for Law and Social Policy's Richer says transitional job programs show special promise for cities struggling to keep pace with suburbs in reducing their rolls. Embracing transitional jobs, she says, "offers some hope to cities trying to confront their problems in a more concentrated and visible way."

According to a September report by the Brookings Institution, a Washington think tank, the 47 largest urban counties in the country were home to 52 percent of their states' welfare cases, while housing only 33 percent of their states' populations.More than one-fourth of all welfare recipients nationwide live in just 10 urban counties, Brookings found.

The major reason, says Bosland, is that more jobs are being created in the suburbs than in the cities, while poverty is more deeply concentrated in cities. "If you're living in a community where there are very few jobs, it's harder to have those networks," she says. "If most of the jobs that are coming open are in the suburbs, and that means two hours of bus transfers and shuttling kids to child care, it makes it that much more difficult," she says.

That's why transitional job programs typically dedicate considerable resources toward making it possible for welfare recipients to work. After four years on welfare in Georgia, Margaret Turner was invited by state caseworkers to join the Good Works program, the transitional job program contracted to Goodwill Industries. Turner had a car, so transportation was not a problem, but she also had six children under age 13. "If you had a child-care problem like me, they were there to help fill the paperwork out. You picked your own service providers," she says. "It was wonderful."

That raises an obvious point: Transitional job programs are expensive. With states and the federal government facing large shortfalls, how will it be possible to fund them? Advocates admit the question is troubling. "Budget crises are a big concern for the programs that are just trying to start up," says Richer. "This is obviously not a cheap model. Our hope is that they will get good enough results, that the policy-makers will say it's worth the investment."

Deepak Bhargava directs the National Campaign for Jobs and Income Support, a Washington anti-poverty group that favors expanding welfare budgets."This is one of the few items we are most hopeful can still get done," he says. "These programs have emerged as one of the most hopeful vehicles for moving the hardest to serve into long-term sustainable employment."