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A Review of the Family Independence Act  2002 -- 2004
September 2004

REPORT (PDF)     SUMMARY (PDF)

The Family Independence Act (FIA) requires the Legislative Audit Council (LAC) to report every two years on the success and effectiveness of the policies and programs created under the act. Specifically, we are to review the three outcome measures required by S.C. Code §43-5-1285 — the number of families and individuals no longer receiving welfare, the number of individuals who have completed education and training, and the number of individuals finding employment. In addition, we followed up on the recommendations contained in our 2002 report. This is our fifth report about the family independence program and its management by the S.C. Department of Social Services (DSS). Our findings include the following.

  • The number of welfare recipients has decreased over the past two calendar years. However, from August 2000 through January 2003, DSS experienced a 32% increase in welfare recipients. In the first quarter of 2003, the rolls peaked at their highest level since September 1998 before beginning to decrease. The family independence (FI) recipient rolls fell from 19,928 in January of 2002 to 18,757 in December 2003, a decrease of 5.9% over two calendar years.
  • In order to receive federal funds, known as Temporary Assistance for Needy Families (TANF), DSS must ensure that FI recipients meet certain participation rates set forth by the federal government. As of April 2004, DSS was meeting the participation rate for all FI families and the rate for two-parent FI families.
  • DSS’s federal TANF waiver has expired. This waiver allowed DSS to exclude certain groups when calculating the state’s participation rate and broaden the list of the activities that could be counted when determining the rate. The loss of the waiver could make it more difficult to meet federal participation rates and possibly result in a loss of federal funds.
  • From January 2002 through December 2003, family independence recipients obtained 13,616 full-time and 6,802 part-time jobs. The majority of those jobs were in the service category (52%) followed by the clerical/sales (27%) category. The average hourly wage was $6.70, up 3% from our last review.
  • The welfare leavers study found that, while there were some positive findings, there is little evidence of welfare leavers moving in large numbers from low-skilled jobs to more skilled jobs or working more regular work hours.
  • After our 2002 review, DSS staff conducted a review of all agency contracts and terminated 17 of the 21 contracts cited in our report. These contracts were valued at approximately $15 million. Our 2002 review also recommended that DSS redirect $5 million in TANF funds that had been committed to the First Steps program. According to DSS staff, the First Steps agreement has been terminated and the funds were redirected to an after-school program.
  • In May 2004, DSS developed a policy revising its contract procedures. The policy requires greater involvement from the procurement division and that monitoring plans be developed. However, as of August 2004, the policy had not yet been fully implemented.