New Hope and W-2: Common Challenges, Different Responses

Thomas Kaplan and Ingrid Rothe
Institute for Research on Poverty, University of Wisconsin-Madison

September 1999
Report Submitted to the New Hope Project, Inc.

This research was conducted under a contract between the authors and the New Hope Project, Inc. Opinions expressed are those of the authors and not the New Hope Project.

Abstract

The Wisconsin Works (W-2) and New Hope programs share common geographic and fiscal roots and achieved public recognition as employment-based welfare reforms at approximately the same time. This report describes similarities and differences between the two programs and compares how they responded to several common challenges. The challenges discussed include those of coaching and counseling program participants in their moves toward independence, managing and training the staff who provide that function, responding to instances of noncompliance in programs that place heavy demands on participants, providing community service jobs that both challenge and protect program participants, providing support for the child care and health insurance expenses of participants, helping participants avail themselves of other opportunities like the Earned Income Credit, and giving staff and managers the information resources they need to assure that all these challenges are met.

New Hope case managers focused more on opening doors to broad program access and offering options to participants than is the case in W-2, although some W-2 agencies have always promoted broad access. Case managers in both programs spend much of their time acting as job coaches and entering program data and calculating program benefits. W-2 has a more graduated sanctions policy for failure to meet the terms of its individualized employability plans, but W-2 sanctions are now applied to about 40 percent of the caseload. New Hope treated community service jobs, which the project arranged and funded, as equivalent to real jobs with fringe benefits, whereas community service jobs in W-2 are viewed as steps in the ladder to real positions in the unsubsidized labor market. Both programs provide child care and health care assistance but collect participant premiums for health care assistance differently, and both programs emphasize participant use of the Earned Income Credit, although New Hope more fully integrated the Earned Income Credit into its benefit structure.