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program to program. The types of commitments that constitute an obligation may
also vary from state to state. According to the Department of Health and Human
Services (HHS), states obligated all of their FY1998 mandatory CCDF funds.
Additionally, states have obligated more than 1/2 of all unexpended TANF funds.
TANF Balances
The presence of billions of dollars in "unused" TANF funds has aroused
interest. However, the TANF program is new, so there is little history available to
assess the magnitude of the balances. There also are no norms to help indicate
whether the TANF balances are abnormally large.
The obligated balance will finance future expenditures that are anticipated and
reflects commitments already made by the states. Since federal law imposes no time
deadline for states to draw cash from their TANF grants, obligations can represent
long-term contracts or commitments that will provide benefits and services to TANF
families for several years into the future.
In TANF, about $3 billion remained at the end of FY1998 that was both
unexpended and unobligated. These are funds states have available from FY1997
and FY1998 grants for new commitments, new TANF spending, or additional
transfers to CCDF or SSBG. These are also the balances available to help finance
future unanticipated expenditures, such as increased benefits paid if the caseload
rises in response to a recession.
There are three points I would like to make about the TANF balances:
First, in passing TANF, Congress anticipated that TANF grants might be
insufficient in a given fiscal year to meet program costs and provided several
sources of federal funding to meet extra costs. One such source is the
flexibility provided to "reserve" TANF grants from previous fiscal years and
accrue balances without fiscal year limit, by setting no deadline on the
obligation and expenditure of TANF grants. (The other sources are the TANF
loan and contingency funds.) Also in passing TANF, Congress permitted
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"ocrText": "CRS-5\nprogram to program. The types of commitments that constitute an obligation may\nalso vary from state to state. According to the Department of Health and Human\nServices (HHS), states obligated all of their FY1998 mandatory CCDF funds.\nAdditionally, states have obligated more than 1/2 of all unexpended TANF funds.\nTANF Balances\nThe presence of billions of dollars in \"unused\" TANF funds has aroused\ninterest. However, the TANF program is new, so there is little history available to\nassess the magnitude of the balances. There also are no norms to help indicate\nwhether the TANF balances are abnormally large.\nThe obligated balance will finance future expenditures that are anticipated and\nreflects commitments already made by the states. Since federal law imposes no time\ndeadline for states to draw cash from their TANF grants, obligations can represent\nlong-term contracts or commitments that will provide benefits and services to TANF\nfamilies for several years into the future.\nIn TANF, about $3 billion remained at the end of FY1998 that was both\nunexpended and unobligated. These are funds states have available from FY1997\nand FY1998 grants for new commitments, new TANF spending, or additional\ntransfers to CCDF or SSBG. These are also the balances available to help finance\nfuture unanticipated expenditures, such as increased benefits paid if the caseload\nrises in response to a recession.\nThere are three points I would like to make about the TANF balances:\nFirst, in passing TANF, Congress anticipated that TANF grants might be\ninsufficient in a given fiscal year to meet program costs and provided several\nsources of federal funding to meet extra costs. One such source is the\nflexibility provided to \"reserve\" TANF grants from previous fiscal years and\naccrue balances without fiscal year limit, by setting no deadline on the\nobligation and expenditure of TANF grants. (The other sources are the TANF\nloan and contingency funds.) Also in passing TANF, Congress permitted"
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