State Rep. Bryan Terry, MD (R-Murfreesboro) is preparing to introduce “Pathway to Prosperity” legislation for the 2021 legislative session in efforts to support Tennesseans currently enrolled in the Temporary Assistance for Needy Families (TANF) program.

The “Pathway to Prosperity” legislation will provide an alternative path with incentives for TANF recipients to receive education, training, and workforce skills as they receive their TANF benefits. It looks to help address the benefits cliff that often prevents citizens from improving their individual economic standing.

“We are looking to transform the program where instead of government providing a hand out, we can provide a hand up to those who find themselves in these difficult circumstances,” said Rep. Terry.  “Tennesseans have a limited amount of time with which they can receive TANF benefits, and we know most also have a limited window of opportunity to change their financial trajectory.  We want to help individuals avoid the benefits cliff and provide them with a pathway to prosperity during this narrow timeframe.”

In 2019, it was discovered that the Tennessee Department of Human Services (TDHS) had built up a federal funding reserve within the TANF program of $732 million dollars. Subsequently, House Speaker Cameron Sexton (R-Crossville) and Lt. Governor Randy McNally (R-Oak Ridge) appointed a Joint House and Senate working group to investigate the TANF program and make recommendations for utilization of the funds. Rep. Terry was asked by his House and Senate colleagues to chair this working group.

Under Dr. Terry’s leadership, the group discovered that the state had inappropriately allocated $221 million in state funds, and they established a corrective action plan for DHS.  “Pathway to Prosperity” was developed from the working group process as a pilot program by Chairman Terry and DHS.  They are currently working with the Lee administration to make this part of the administration’s legislative package for 2021.

“We had planned to run the legislation this past session, but with the emergencies related to the tornado and the COVID-19 pandemic, we needed to see if the TANF funds could serve a more immediate need,” Rep. Terry added.  “While we have been out of session, I have continued to monitor the program and work with DHS, the administration, and Speaker Sexton on this issue.  I believe we are now in a position to implement this plan and help our most vulnerable achieve upward income mobility.”

Currently, TANF recipients are eligible for cash assistance for up to 60 months.  While recipients may receive other assistance, such as childcare or help with transportation, there is not an incentive for recipients to improve their marketable employment skills while on TANF. If passed, the legislation would provide recipients with an enhanced cash benefit if they showed progress towards a degree, training, or apprenticeship.

“The benefits cliff is often a barrier to income mobility for workers and an employment challenge for businesses that are looking to hire,” said Speaker Sexton.  “This Pathway to Prosperity legislation is precisely the type of conservative solution that we envisioned when the TANF Working Group was first established. Chairman Terry understands the complex dynamics involved with recipients, TANF, DHS, and the business community.  I appreciate the working group’s efforts, as well as Dr. Terry’s leadership, which has helped us create this innovative solution.”

Currently, Tennessee receives a $191 million dollar grant each year as part of the federal budget to assist the Department of Human Services as they implement the TANF program. Because of Tennessee’s fiscal stability and economic standing, the state has seen a considerable decrease in the number of citizens utilizing TANF benefits.  As such, Tennessee transitioned from spending well over their grant amount to only utilizing around $70 million per year.  The additional unspent $121 million annual allotment has resulted in almost $800 million in reserve funding that can only be utilized through the program.

“These are essentially Tennessee taxpayer monies that the federal government has collected and placed aside for our state to use for TANF benefits.  I see this Pathway to Prosperity legislation as an investment into our future; we are looking to utilize these funds to create a return on investment where we can get a win-win-win situation.  Tennesseans can encounter income mobility and job security.  Businesses will have highly-skilled employees, and less individuals will remain dependent on the government, which benefits our taxpayers,” concluded Terry.