Title page

Contents

Highlights 2

Letter 6

Background 9

TANF Authorizing Legislation and Available Funds 9

Statutory Purpose and Eligible Uses of TANF 11

Federal TANF Reporting Requirements 14

Prior and Ongoing GAO Reviews of TANF 15

State Non-Assistance Spending and Unspent Funds Increased from 2015 to 2022 16

Non-Assistance Spending As a Share of All TANF Spending Increased between Fiscal Year 2015 and Fiscal Year 2022 16

TANF Unspent Balances Increased between 2015 and 2022 18

Selected States Made TANF Budget and Transfer Decisions Based on Estimated Caseloads, Historical Precedent, and Legislative Priorities 20

Most Selected States Reported Estimating Basic Assistance Caseloads as Part of the TANF Budgeting Process 20

Selected States' Non-Assistance Spending Decisions Reflect Legislative Priorities, Historical Precedent, and Local Needs 21

Selected States Transferred TANF Funds to Eligible Block Grants Based on Historical Precedent or State Agency Preferences 23

Selected States Attributed Increases in Unspent Funds to Overestimation of Program Needs and Availability of Other Federal Funds 25

Few Selected States Used Non-Governmental Third-Party Expenditures to Satisfy Maintenance of Effort Requirements 26

Selected States Have Various Processes for Reviewing and Confirming Statutory Eligibility of TANF Programs and Accuracy of Expenditure Reporting 28

Selected States Reviewed Statutory Eligibility of New Programs through Annual Appropriations and the Award of Grants and Contracts 28

Selected States Reported Monitoring TANF Programs for Ongoing Eligibility through Reimbursement Processes and Program Reviews 29

Selected States Have Processes to Review the Accuracy of TANF Expenditure Reporting 30

ACF's Existing Controls and Authorities for TANF Reporting Limit Oversight of State Spending 31

Not All States Submitted Complete Narratives for TANF Reports to ACF 31

Reports ACF Requires from States Do Not Include Detail on Certain TANF Non-Assistance Expenditures 33

Conclusions 36

Matter for Congressional Consideration 37

Recommendations for Executive Action 37

Agency Comments 37

Appendix I: Temporary Assistance for Needy Families Reporting Categories 39

Appendix II: Territorial Temporary Assistance for Needy Families Financial Reports, Fiscal Year 2022 43

Appendix III: State Temporary Assistance for Needy Families Unspent Balances, Fiscal Year 2020 to Fiscal Year 2022 49

Appendix IV: Comments from the Department of Health and Human Services 52

Appendix V: GAO Contact and Staff Acknowledgments 54

Figure 1. Temporary Assistance for Needy Families (TANF) Funding Sources Available to States 11

Figure 2. Change in Percentages of Temporary Assistance for Needy Families (TANF) Expenditures and Transfers by Category from Fiscal Year 2015 to Fiscal Year 2022 17

Figure 3. Temporary Assistance for Needy Families (TANF) Funds Spent or Transferred, Fiscal Year 2022 18

Figure 4. Temporary Assistance for Needy Families (TANF) Total Unspent Balances by All States, Fiscal Year 2015 to Fiscal Year 2022 19

Figure 5. Selected States' Transfer of Temporary Assistance for Needy Families (TANF) Funds to Eligible Block Grants in Fiscal Year 2022, as a Percentage... 24

Table 1. Temporary Assistance for Needy Families (TANF) Expenditure Groups and Expenditure Reporting Categories 40

Table 2. Guam Temporary Assistance for Needy Families (TANF) Financial Report, Fiscal Year 2022, Grant Year 2016 to Grant Year 2022 44

Table 3. Puerto Rico Temporary Assistance for Needy Families (TANF) Financial Report, Fiscal Year 2022, Grant Year 2016 to Grant Year 2022 45

Table 4. U.S. Virgin Islands Temporary Assistance for Needy Families (TANF) Financial Report, Fiscal Year 2022, Grant Year 2016 to Grant Year 2022 47

Table 5. Temporary Assistance for Needy Families (TANF) Unspent Balances, Fiscal Year 2020 to Fiscal Year 2022 49