One of the most controversial features of the 1990s welfare reforms was the imposition of time limits on benefit receipt. Time limits became a central feature of federal policy in the landmark 1996 welfare law, which created the Temporary Assistance for Needy Families (TANF) block grant. The law prohibits states from using federal TANF funds to assist most families for more than 60 months. Under contract to the Administration for Children and Families (ACF) in the U.S. Department of Health and Human Services, The Lewin Group and MDRC have conducted a comprehensive review of what has been learned about time limits. The review, which updates a 2002 study, includes analysis of administrative data reported by states to ACF, visits to several states, and a literature review. The update is timely because most states now have several years’ experience with time limits.
Federal law affords states great flexibility in setting time-limit policies. The federal 60-month limit does not apply to state-funded benefits; also, states may use federal TANF funds to support up to 20 percent of the caseload beyond 60 months. Thus, states may set a 60-month time limit, a shorter limit, or no time limit, and they may choose to exempt families from time limits. Not surprisingly, time-limit policies vary dramatically from state to state.