H.R.2359 - Improve Transparency and Stability for Families and Children Act (119th Congress)
Summary
H.R.2359, the "Improve Transparency and Stability for Families and Children Act," aims to amend Title IV of the Social Security Act. The bill introduces deadlines for states to obligate and expend funds received through the Temporary Assistance for Needy Families (TANF) block grant program. It also allows states to establish "rainy day funds" by reserving a portion of their TANF funds for future use.
The bill sets a deadline for states to obligate funds within the succeeding fiscal year and expend them within the second succeeding fiscal year. An exception is provided, allowing states to reserve up to 15% of the funds, not exceeding 50% of the prior year's total TANF grant, for future use.
The amendment is set to take effect on October 1, 2026, providing states with a period to adjust their financial planning and program implementation strategies.
Expected Effects
The primary effect of this bill would be to impose greater financial discipline on states receiving TANF funds. States would be required to manage their TANF funds more strategically to meet the obligation and expenditure deadlines.
The establishment of rainy day funds could provide states with greater flexibility to address economic downturns or unexpected needs within their TANF programs. This could lead to more stable support for needy families during times of crisis.
However, the restrictions on reserving funds could also limit a state's ability to respond to long-term challenges or invest in innovative programs.
Potential Benefits
- Increased Accountability: The deadlines for obligation and expenditure of funds could lead to greater accountability and transparency in how states use TANF funds.
- Financial Stability: The establishment of rainy day funds could help states maintain a stable level of support for needy families, even during economic downturns.
- Strategic Planning: The bill encourages states to engage in more strategic financial planning to ensure that TANF funds are used effectively and efficiently.
- Flexibility: The rainy day fund provision provides states with some flexibility to address unexpected needs or invest in long-term solutions.
- Focus on Outcomes: By requiring timely expenditure of funds, the bill may encourage states to focus on achieving measurable outcomes for families receiving TANF assistance.
Potential Disadvantages
- Reduced Flexibility: The deadlines for obligation and expenditure of funds could reduce a state's flexibility to respond to changing needs or invest in innovative programs.
- Administrative Burden: The requirement to track and manage funds according to the deadlines could create an additional administrative burden for states.
- Potential for Waste: The pressure to expend funds within the specified timeframes could lead to wasteful spending if states are unable to identify effective programs or services.
- Limited Reserve Capacity: The restrictions on the amount of funds that can be reserved for future use may limit a state's ability to address long-term challenges or prepare for major economic downturns.
- Unintended Consequences: The bill could have unintended consequences, such as discouraging states from seeking federal TANF funds or reducing the overall level of support for needy families.
Constitutional Alignment
The bill appears to align with the general welfare clause of the Constitution (Preamble), as it aims to improve the stability and transparency of programs designed to assist needy families. The bill operates within the framework of the Social Security Act, which has been generally upheld as constitutional.
Congress has the power to tax and spend for the general welfare (Article I, Section 8). This bill falls under that power, as it regulates how federal funds are distributed and used by states for specific social welfare programs.
There are no apparent violations of individual rights or freedoms guaranteed by the Constitution or its amendments.
Impact Assessment: Things You Care About ⓘ
This action has been evaluated across 19 key areas that matter to you. Scores range from 1 (highly disadvantageous) to 5 (highly beneficial).