Missed Opportunities to Support Wisconsin Families: W-2 Caretaker of Newborns Extension

This is the first blog in a series about some of the legislature’s Missed Opportunities to Support Wisconsin Families stemming from the Joint Finance Committee’s decision to remove public assistance program recommendations from the budget bill.

Establishing a close bond with a parent or caretaker is crucial for a baby’s future wellbeing. Given Wisconsin’s race, ethnicity, gender and income-related disparities in health and education, the state needs policies that support families furthest from opportunity. That is why legislators should have approved Governor Evers’ proposal to extend Wisconsin Works (W-2) benefits to parents or caretakers of newborns by four weeks, allowing for further bonding before returning to work.

One eligibility requirement for a W-2 unit of two is gross earnings of less than $19,447 annually. The majority of these parents and caregivers are women. Women make only 80% of men’s wages, and Black and Latina women make even less. Clearly, offering these Wisconsin parents and caretakers (of whom the majority are women of color) an extra month to bond, recover from giving birth and/or adjust to the caregiver roll and prepare to return to work is a small, but important step forward in support of Wisconsin families.

This extension would also directly benefit children because infancy is a crucial time for brain development (as well as social, emotional and cognitive development), which depends on a loving attachment relationship with a primary caregiver. Children with a strong attachment are more independent, perform better in school, have successful social relationships and experience less depression and anxiety. Allowing new parents the opportunity to spend up to 12 weeks developing these bonds has long term benefits for children, families and communities as a whole. 

Unfortunately, the change proposed by the governor is one of the 60 budget recommendations that the Joint Finance Committee stripped from the budget bill without any substantive debate. The Finance Committee’s procedural vote meant that the Legislative Fiscal Bureau did not prepare a paper on the issue, but the Governor’s recommendation still deserves consideration and debate.

Policy background/history: 

Currently, Wisconsin provides a two-month benefit for custodial parents or caretakers of newborns. That benefit was cut from three months in 2015 and from 12 months in 1996 when Temporary Assistance for Needy Families (TANF)/Wisconsin Works (W-2) was established. Governor Evers’ proposal to return to three months would have shifted gears and moved in a direction of supporting children and families, a direction that most other states have already moved.

Since the enactment of W-2, the state has imposed a requirement that to receive any cash assistance from the state, a parent or caretaker of a child needs to be working or engaged in training.  The creation of the W-2 program made Wisconsin a national leader in imposing that sort of requirement. This proposal was accepted in Wisconsin and became a template for the nation during a time when the now-debunked and racialized myth of women as welfare queens was widely accepted.

From the outset, an important part of the policy debate has been the question of how long the state should support mothers or caretakers in caring for newborns before requiring them to go back to work or a training program.  The federal welfare reform law known as the Personal Responsibility and Work Opportunity Reconciliation Act (PRWORA), which was enacted shortly after the creation of W-2, establishes federal work requirements, but gives states discretion to set policies relating to caretakers of newborns. Since implementation, the range of exemptions has been from zero months (no exemption) to 24 months. A review of 2017 state policies indicates that the exemptions offered by 38 states are longer than the 2-month exemption currently offered by Wisconsin.

This policy change would have expanded one line of the state budget and cut another. The estimated cost of the governor’s proposed extension is $377,200 annually. Because impacted families would not utilize both W-2 cash benefits and the Wisconsin Shares child care subsidy during that extra month, the actual cost to the state is $377,200, less $165,800 in child care savings. So, the annual estimated cost is $211,400. A Legislative Fiscal Bureau paper would offer more information about those cost estimates.

The case for expanding this benefit 

Lengthening the amount of time caretakers can spend with their newborns by 4 weeks is an opportunity to support very low-income parents enrolled in the W-2 program to provide their children with important building blocks for success and transition back to work/education. Most recipients are women, are single, and have a high school diploma or less schooling, and about a third of adult recipients are white and two thirds are people of color. Supporting these parents and caregivers of newborns is an investment that the state should make.

Developing a strong bond between parent/caregiver and a baby takes time and the healthy development affords long-term benefits for the child, family and society. Extension of this benefit also reflects an investment in children of color who are disproportionately represented among W-2 recipients, which could help disrupt the persistent academic achievement and health disparities in Wisconsin. Extending the caretaker benefit from 8 to 12 weeks is a small investment to make in the health and well-being of our Wisconsin’s children and families that are furthest from opportunity.

The Governor’s proposal to extend Wisconsin Works (W-2) benefits to custodial parents or caretakers of infants from 8 to 12 weeks should be introduced as separate legislation to promote public discussion of the issue, and ultimately it should be passed. This is an inexpensive and important step to support the healthy development of Wisconsin children and families.

Susan Stanton