Bill Allows States to Shift Welfare Funds to Job Training Starting 2026: What It Means for Aid and Work Programs

A new piece of legislation, the "Reduce Duplication and Improve Access to Work Act," proposes a change to how states can use federal funds intended for families in need. Starting October 1, 2026, this bill would allow states to transfer a portion of their funding from the Temporary Assistance for Needy Families (TANF) program over to workforce development programs under the Workforce Innovation and Opportunity Act (WIOA). States choosing this option would need to submit a coordinated plan to the federal government detailing how they'll manage these funds.

Shifting Gears: From Direct Aid to Job Skills?

Essentially, this bill offers states more flexibility. TANF is primarily known for providing direct cash assistance and support services to low-income families with children. WIOA, on the other hand, focuses on job training, education, and employment services designed to help people find and keep jobs. The idea here seems to be enabling states to use some TANF dollars—traditionally for immediate needs—to invest in job skills programs under WIOA, potentially creating a smoother path from assistance to employment for recipients.

The Fine Print: Caps and Coordinated Plans

The proposal isn't a blank check. If a state transfers TANF funds to WIOA, there's a specific rule: no more than 15% of those transferred funds can be used for broad, statewide workforce activities. This suggests the bulk of the shifted money should target local job training and employment services directly serving individuals. Furthermore, states opting in must develop a "combined state plan," approved by both the Department of Health and Human Services (which oversees TANF) and the Department of Labor (which oversees WIOA). This requirement pushes states to think strategically about how these two different types of support systems will work together.

Real-World Ripple Effects: Balancing Support and Opportunity

So, what could this look like on the ground? For someone receiving TANF assistance, it might mean new opportunities to access job training programs funded partially by these shifted dollars, potentially leading to better long-term job prospects. However, the core function of TANF is providing a basic safety net. The main question this bill raises is one of balance: if states move funds away from direct cash assistance or immediate support services to fund WIOA programs, could it reduce the help available for families struggling to meet basic needs right now? States would need to carefully manage this trade-off, ensuring that the push for workforce integration doesn't inadvertently weaken the essential support TANF provides.