Individuals who were randomly assigned to the comparison group were subject to Vermont’s existing AFDC program, which meant they could receive cash assistance without financial incentives to work.
A cost–benefit analysis estimated that single-parent family participants gained more in earnings, fringe benefits, tax credits, and supportive services than they lost in public assistance, tax payments, and medical assistance, by about $130 (in 2000 dollars) per person. The government incurred a cost of about $300 per person. The study defined government cost as the amount the government spent on participants in WRP Incentives Only relative to the amount the government saved from reduced public assistance benefits. Taken together, that represented a cost of about $170 to society.
WRP Incentives Only provided services to participants from July 1994 to June 2001. The study randomly assigned cash assistance applicants and existing recipients to study group from July 1995 to December 1996. Participant impacts were measured for six years after random assignment.
WRP Incentives Only was created under the federal Section 1115 waivers to test new approaches to achieving AFDC’s goals. WRP Incentives Only’s aim was to encourage work and increase self-sufficiency for individuals receiving cash assistance welfare through financial incentives. Both single-parent and two-parent families were eligible for cash assistance regardless of their recent work history. Unmarried families that lived and had a child together were treated as a family unit. WRP Incentives Only did not have a time limit for cash assistance. Two-parent families with able-bodied adults were required to participate in Reach Up, Vermont’s welfare-to-work program, immediately. The primary earner was required to search for and accept employment. Financial incentives included the following:
- Enhanced earnings disregard: The first $150 of a participant’s earnings, plus 25 percent of remaining earnings, was not considered in determining benefit eligibility.
- Asset limits: Participants could own a car of any value without it counting toward asset limits that might make a family ineligible for benefits, which allowed participants the opportunity to have reliable transportation.
- Child support: Custodian parents received the full child support payments, rather than receiving only the first $50 a month and the state keeping the remainder. Payments less than $50 were not counted as income so were not counted against their cash assistance benefits.
- Medicaid: Participants received transitional Medicaid coverage for three years and child care subsidies for one year if their family income did not exceed 80 percent of the Vermont median income.
The study did not discuss any tools to measure fidelity to the intervention model.
DSW and the U.S. Department of Health and Human Services funded the intervention, with DSW funding case management and local providers funding employment and training services.
While WRP Incentives Only was implemented in all 12 of Vermont’s welfare districts, the study focused on 6 of these regions. The welfare districts in the study included about two-thirds of Vermont’s cash assistance caseload.
The Vermont Department of Social Welfare (DSW), later called the Department of Prevention, Assistance, Transition, and Health Access, implemented WRP Incentives Only.
The Vermont Department of Employment and Training (DET) operated Reach Up job search classes.
WRP Incentives Only served single- and two-parent families applying for or receiving cash assistance welfare. Participation was mandatory.
Of participants in single-parent families, 93 percent were female, and the average age was 31. Seventy-three percent held high school diplomas or GEDs. Of the single-parent families, 89 percent had at least one child younger than age 13, and 37 percent had a child younger than age 3.
The study did not discuss the overall demographic statistics of two-parent families. However, it did present statistics for two-parent families with a disabled parent, which show that the parents in 87 percent of such families were married. Of two-parent families with a disabled parent, 83 percent had at least one child younger than age 13, and 30 percent had a child younger than age 3.
Forty-five percent of single-parent families in WRP Incentives Only participated in an employment-related activity, including education and training, in the six-year follow-up period.
Eligibility specialists and family services case managers provided services at DSW. Staff at DET provided Reach Up services. The study authors did not include information on the number of staff or their training, degrees, or certifications.