Sneak Preview: Board Rules Indiana Lacked Data on TANF Estimates

June 20, 2012 | By Jerry Ashworth | Post a Comment

(The following was excerpted from an article in the Federal Grants Management Handbook.) States estimating their reimbursements for Temporary Assistance for Needy Families services should understand how to establish reasonable estimates and how to determine which expenditures are allowable as TANF maintenance-of-effort.

The Department of Health and Human Services Departmental Appeals Board recently upheld a decision by the Administration for Children and Families to deny TANF reimbursements of about $21.6 million sought by the Indiana Family and Social Services Administration. The state requested reimbursements through a TANF emergency contingency fund (ECF) application for expenditures related to emergency charity care at three hospitals, United Way community economic relief fund (CERF) grants and Township Assistance programs.

To receive its full allocation of federal TANF funds, a state must spend a specified level of state funds, referred to as the state maintenance of effort, to assist eligible families. ACF determined that Indiana’s method for estimating expenditures attributable to TANF-eligible users was not reasonable. It added that hospital charity care is not a maintenance-of-effort expenditure under TANF regulations because it represents “foregone revenue.”

Indiana argued that its estimating methods were reasonable, and that ACF’s evaluation of the expenditures “applied an invalid legislative rule of which the state had no prior notice.” It added that ACF’s determination was arbitrary and capricious because ACF granted ECF funds to other states that used similar methodologies. Indiana also argued that hospital charity care is a TANF maintenance-of-effort expenditure and was not foregone revenue.


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