Since President Clinton signed the Personal Responsibility and Personal Reconciliation Act in 1996, welfare reform has been in the spotlight because of the new responsibilities this places on state government for tailoring and implementing their own programs.

Public attention has focused primarily on the opportunity this presents for states to creatively meet their vastly expanded responsibilities. Perhaps just as important, however, are the changes in the way the U.S. Dept. of Health and Human Services (HHS), the U.S. Dept. of Agriculture (USDA), and other agencies must now go about handling their relations with the states. On one hand, there has emerged what many see as a new willingness in state and federal agencies to work together in tackling the problems of making the new, evolving system work. A big part of this is creating information systems that serve the needs of federal, state and even, in some cases, local agencies.

But beyond this, the changing role of HHS and other federal agencies in implementing the new legislation is also serving to map an innovative path toward what the Urban Institute has started to call "the new federalism." Rather than making policy decisions, HHS now has three main functions. It is to serve as a fiscal watchdog for federal dollars and to impose penalties under law. In addition, there is a greatly enhanced role in conducting research and analysis as well as providing technical IT assistance to the states.

Ronald Haskins of the Ways and Means Committee said HHS will now be "a form generator, a coordinator, a state plan reviewer, an organizer, a penalizer, an evaluator, and a researcher; less of a controller and less of a policymaker." This new role, he pointed out, includes spreading the word on best practices to every state -- something that could be achieved through such things as Web sites, conferences and e-mail assistance as well as through rewards.

The new data-gathering and reporting duties are explicit and extensive, not only for HHS but for other agencies as well. The Bureau of the Census, for example, is to conduct a random, national sample of families and children, especially poor children and those who are abused or neglected. Other special studies are also called for, including evaluations of employment strategies and analysis of employment outcomes.

Nonetheless, HHS is taking the lead in mapping out the dimensions of this new federalism. For instance, the need to measure performance, in part, is required so that millions of dollars earmarked by Congress to reward states if they meet certain goals can be appropriately dispensed. There is $20 million designated for each of the top five states that decrease out-of-wedlock births and another $200 million to states that keep children at home, make parents less dependent on government benefits, and encourage two-parent families.

The task of rating state performance, which falls to HHS, means that states will be getting a report card on their performance. Wendall Primus, former deputy assistant secretary of HHS and now director of income security at the Center on Budget and Policy Priorities, pointed out that by releasing this information publicly, some states' performance rankings "will occasionally contain some damaging information" that could have significant political consequences within states.

The data reporting and management tasks required by the new legislation are quite daunting, and this alone will ultimately force higher degrees of cooperation than existed in the past. The law calls for keeping track of assistance time limits and the creation of registries for new hires, involving both HHS and the Dept. of Labor, child support enforcement and parent locator efforts. This will be virtually impossible without tighter coordination and more links between databases than has ever existed in the past.

New Federalism

However, at heart of the new federalism lies legislatively stated restrictions on what regulations can

Blake Harris  |  Editor