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What is the TANF Contingency Fund?

During the original Welfare Reform of 1995, there was great concern that states would have difficulty administering TANF during a recession, due to the fixed nature of the block grant. Because of these concerns, the Emergency Contingency Fund of $2 billion was developed, which would provide states with additional federal funds of up to 20% of their block grant amount if they indicated that they were facing a recession or trigger (rising unemployment or r