December 10, 2019
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A process that led to $13M in unlawful spending of federal money isn’t robust

Robert F. Bukaty | AP
Robert F. Bukaty | AP
The State House is seen in Augusta, Oct. 23, 2017.

When Gov. Paul LePage leaves office in January, part of his legacy will be the about-face his administration has orchestrated in how the state spends a $78.1 million federal block grant it receives each year.

The Temporary Assistance for Needy Families grant’s purpose ostensibly is to pay for cash assistance for low-income families and for services to help the adults in those families find work. But during LePage’s tenure, as the administration has slashed welfare caseloads, TANF has become an opaque vehicle to help the administration save money elsewhere in the state budget. The administration hasn’t indicated what it’s doing with the savings.

One wouldn’t come away with that impression, however, from reading a recently released report on the administration’s use of TANF by the Legislature’s investigative arm, the Office of Program Evaluation and Government Accountability.

Lawmakers requested the TANF probe last year given substantial declines in the number of low-income families receiving assistance despite increases in extreme childhood poverty in recent years. The report was also motivated by legislators’ lack of overall knowledge about how exactly the LePage administration is using a $78.1 million grant, which is subject to few federal restrictions.

The number of families receiving assistance began to fall precipitously in 2012 after the LePage administration and Republican-controlled Legislature started holding families to a five-year lifetime limit on assistance. But even as the caseload dropped by more than two-thirds — nearly 15,000 children were among those who lost assistance — the state continued to receive the same $78.1 million each year from the federal government.

At first, the Maine Department of Health and Human Services allowed a balance of TANF funds to accrue, reaching $155.5 million in June 2016, according to the Legislature’s budget office. Behind the scenes, though, DHHS was determining alternative uses for TANF funds, with the intent of saving money, not helping Maine’s poorest families, the BDN discovered by reviewing hundreds of pages of internal department emails. The department also sought to redeploy money meant for low-income families with children to help elderly and disabled Maine residents instead.

As the BDN revealed in June 2016, DHHS spent $13.4 million that originated in TANF on programs for elderly and disabled residents — a direct violation of federal law.

When caught, DHHS reversed the spending.

It turned out, based on the emails the BDN reviewed, that DHHS officials were aware the spending violated federal law, but went ahead with it anyway.

In its recent report, OPEGA described the internal process DHHS said it used to determine how to spend TANF funds no longer used for basic cash assistance. Instead of calling into question a process that resulted in the misspending of more than $13 million, OPEGA called DHHS’ internal decision-making process “robust.”

OPEGA also noted that DHHS began using TANF to cover an array of state obligations traditionally paid for with state taxpayer money, but the office appeared to make no attempt to calculate the extent of this supplantation.

This spending pattern happened outside the legislatively authorized budget process. Lawmakers allocated state money for services that DHHS then covered with TANF, freeing up the legislatively allocated money. The BDN determined last year that DHHS planned to use $34.5 million from TANF in fiscal year 2018 (July 1, 2017, to June 30, 2018) to cover existing obligations previously covered by other state funding sources.

DHHS never answered the BDN’s questions about what it planned to do with the general fund money this process freed up. That’s an appropriate question for a team of auditors to answer, but a topic that OPEGA didn’t broach.

OPEGA did look into whether DHHS included performance expectations in some of the dozens of the TANF-funded contracts it issued to social service organizations. DHHS did, for the most part. ( After-school programs, for example, are held to particular student attendance expectations.)

But OPEGA made no attempt to determine whether DHHS was making the most effective use of TANF funds given the goal for TANF outlined in state law: promoting “family economic self-support.”

The available evidence shows that DHHS’ changes haven’t made low-income families better off. A LePage administration analysis from last year showed that two-thirds of those who lost TANF-funded assistance continued to lack employment and that those who were working were earning poverty-level wages. Other research has shown that many families plunged into homelessness.

OPEGA’s report, which will be the subject of a public hearing Thursday, leaves readers with the impression that DHHS’ TANF spending problems are minor.

That’s an impression that cannot stand.

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