Mr. Chairman and Members of the Committee, I appreciate the opportunity to testify today on a matter of great importance to me and one that should be a centerpiece of TANF reauthorization -- providing access to quality affordable housing for our nation’s low-income working families.
Mr. Chairman, welfare reauthorization must be about creating programs that reduce poverty -- programs that give parents the skills they need to get good paying jobs that enable them to pay for housing, child care, and food.
While welfare reform has succeeded in moving thousands of families off of welfare and into work, it has condemned many to low-wage jobs that keep them trapped in poverty, and all too often, trapped in substandard housing.
Mr. Chairman, a lack of affordable housing is one of the main obstacles facing families trying to leave welfare. Even for those families who do succeed in leaving welfare for work, a lack of affordable housing can mean a return to the welfare rolls. And, for those who have reached state or federal welfare time limits, it can mean homelessness.
Since 1997, welfare reform has encouraged 60% of New Jersey’s welfare families to leave welfare for work. Despite the fact that these families are now earning wages that are two to three times the modest cash benefits of TANF, families in New Jersey and across the country struggle to afford housing. For example, in the year 2000, 44 percent of all renters in New Jersey were unable to afford the Fair Market Rent for a 2-BR unit, which is $929. An individual working 40 hours a week and earning minimum wage in New Jersey earns about $824 a month, one hundred dollars less than it costs just to afford a 2-BR apartment.
The State of New Jersey has been a leader in providing housing assistance to families receiving cash assistance and to low-income families who have left welfare for work. However, the state’s ability to adequately address these housing needs is limited by federal TANF rules enacted in the 1996 welfare reform law that restrict states’ ability to provide housing assistance to families transitioning off of welfare.
New Jersey is one of nine states that commit federal TANF dollars and state maintenance of effort dollars to provide housing assistance to families leaving welfare for work and low-income working families at risk of homelessness.
New Jersey uses $2 million of its federal TANF block grant to provide emergency housing assistance to working families with incomes up to 250% of the federal poverty level. However, because federal law limits housing assistance to four months, the state is forced to stop assistance after this time, even if the family is at risk of becoming homeless.
New Jersey has also embarked upon several innovative low-income housing initiatives aimed at encouraging work and improving self-sufficiency. The New Jersey Housing Assistance Program (HAP), for instance, provides temporary housing subsidies to eligible welfare recipients transitioning to work. Recipient families receive a housing subsidy that is reduced as their income increases. Savings from the reduced subsidy are placed in an escrow account that the family may access to purchase a home, pay for educational expenses, or for emergency purposes.
Despite the fact that the New Jersey Housing Assistance Program encourages work and creates savings for more than 350 low-income families in New Jersey, New Jersey cannot use federal TANF funding to expand the program.
New Jersey has also allocated $4 million of its federal TANF block grant to help low-income working families utilize Section 8 vouchers. These one-time funds can be used for security deposits or moving expenses. They can also be used as payments to landlords while repairs are made to bring a rental unit up to Section 8 standards.
Fortunately, New Jersey’s housing initiatives are making a modest difference. They are helping low-income working families stabilize their finances, minimize financial crisis, and, where feasible, become first time home buyers. Just think of how many more families the state could help if they could use federal TANF funds to expand these programs.
Next week, Senator Wellstone and I will be introducing comprehensive TANF reauthorization legislation that, in addition to increasing access to education, job training, child care, substance abuse and mental health counseling, will give states tools to better address the housing needs of low-income working families through their TANF programs. It will also increase state TANF block grants to account for inflation so that states can continue to help families transition off of welfare and support low-income working families.
Specifically, the Wellstone-Corzine bill clarifies that states can use federal TANF dollars to provide supplemental housing benefits, minor housing rehabilitation, and emergency housing assistance to families transitioning from welfare to work, without requiring them to remain on welfare in order to receive these benefits.
Our legislation also requires states to address housing needs in their state welfare plans. Under current law, Public Housing Agencies are required to enter into cooperation agreements with welfare agencies; however, there is no requirement that welfare agencies enter into these agreements. Wellstone-Corzine would require welfare agencies to work with public housing agencies to coordinate work-promoting services, implement earnings disregards, and improve employment outcomes for all public housing residents. Earnings disregards allow TANF recipients who receive housing assistance to retain this assistance for up to two years, regardless of increases in income. These are the kinds of programs that encourage, rather than penalize work.
The Wellstone-Corzine bill also creates a $50 million demonstration program to create supportive housing for TANF families with multiple barriers to work, including mental and physical disabilities. Supportive housing -- housing which integrates employment services and rehabilitative services -- has succeeded in helping many homeless adults find employment and permanent housing. These programs hold similar promise for TANF families with significant barriers to work.
Mr. Chairman, as we reauthorize the TANF program we must recognizes the role that affordable housing plays in helping low-income families transition from welfare to work, become self-sufficient, and provide a stable, nurturing environment for families. I urge my colleagues to join in the effort to ensure that working families have stable homes. Mr. Chairman and Members of the Committee, I look forward to working with you to make this a reality.
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