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State plans program cuts and to repurpose TANF carryover to cover $35.5 million child care shortfall
Summary
DHHS officials told the committee the state will implement programmatic adjustments and repurpose about $23 million in unobligated TANF carryover funds to cover a projected $35.5 million shortfall in child care assistance for the 2025–27 biennium.
Department of Health and Human Services officials told the Legislative Audit and Fiscal Review Committee on March 24 that North Dakota faces a projected $35.5 million shortfall for child care assistance in the 2025–27 biennium and has adopted programmatic adjustments to address the gap.
Michele Gee, Director of the Economic Assistance Division, outlined changes including implementing a waitlist, adjusting state maximum rates to the 50th percentile of market rates for preschool, school-age, and part-time care, modifying Quality Rating and Improvement System bonus payments, establishing minimum attendance requirements, and altering age eligibility. Gee said the department plans to repurpose approximately $23 million in unobligated Temporary Assistance for Needy Families (TANF) carryover funds toward the remaining deficit; she characterized these TANF dollars as previously unobligated balances that do not affect current TANF program operations.
Committee members asked whether repurposed TANF funds are legally permissible; Gee said North Dakota may carry over TANF funds and there is no federal limit on the duration of TANF carryover funding. The department's decision to repurpose TANF carryover was presented as an interim funding measure; the committee recorded the discussion as part of its audit-related updates.
