III. THE FLOW OF CASES THROUGH THE LBP

One of the three main components of the LBP Study is an analysis of the flow of cases through the LBP. This analysis, which we refer to as the flow analysis, has four research objectives: (1) to document reasons for assignment to the LBP, (2) to describe the characteristics of cases assigned to the LBP, (3) to describe paths out of the LBP, and (4) to document the receipt of FIP and Food Stamp benefits over time by cases assigned to the LBP.

The flow analysis relies exclusively on administrative, or program, data from the Iowa DHS. In particular, data from several LBP and FIP program files are used to measure various aspects of the LBP assignment, individual and case characteristics, and the receipt of FIP and Food Stamp benefits. The sample for the analysis consists of all cases with first assignments to the LBP starting in the six month period from November 1994 through April 1995.

A. DATA SOURCES

The flow analysis is based on three administrative data files. The core data file is the LBP Master File, Iowa's administrative file on LBP assignments. This is supplemented with data from the Iowa Automated Benefit Calculation (IABC) System Case Master File and the IABC Individual Master File, which provide case- and individual-level data on welfare clients and applicants.

1. LBP Master File

The LBP Master File is a cumulative data file that contains information on each assignment ever made to the LBP. The file is structured by assignment, with one record per individual per assignment to the LBP. For each assignment, the file provides key program information pertaining to the LBP. Four data elements in this file are of particular interest in the flow analysis: the reason for assignment, the starting date of the assignment, the reason for cancellation, and the date of cancellation. The file also includes the name and state identification number of the individual assigned to the LBP and the IABC case number of his or her case. These identification numbers act as direct links to data in the IABC Case Master and Individual Master Files.

2. IABC Case Master File

The IABC Case Master File is a monthly data file that provides current and historical information on each family that is participating in, or has applied for, FIP.(1) This file is organized by welfare benefit unit, or case, with one record per case. The file includes the IABC case number and name of the case-name person (the person in whose name the benefit check is issued). These identifiers provide links to data in the LBP Master File and the IABC Individual Master File.

For the flow analysis, the Case Master File provides data on FIP and Food Stamp receipt by cases assigned to the LBP. In particular, the file provides monthly FIP and Food Stamp benefit histories for the period surrounding the LBP assignment.

3. IABC Individual Master File

The IABC Individual Master File is a monthly data file that provides information on each individual belonging to a case included in the Case Master File. The file includes the individual's state identification number and the IABC case number of his or her case. These identifiers provide links to data in the LBP Master File.

For the flow analysis, the Individual Master File provides measures of demographic characteristics of the individual assigned to the LBP. These include the age, race/ethnicity, gender, marital status, and education of the individual assigned to the LBP. In addition, it provides information on several case-level characteristics, including the number of persons, the number of children in the case, and the age of the youngest case member; these are measured by aggregating the data over individuals in the same case.

B. SAMPLE FOR THE FLOW ANALYSIS

The sample for the flow analysis is defined primarily by the starting date of the LBP assignment. In particular, the sample consists of each case with a first assignment to the LBP starting between November 1994 and April 1995 inclusive. The following discussion covers several issues in the sample design.

1. Sample Window

The flow analysis centers on cases with LBP assignments starting during a certain time period, or sample window. Our choice of the length and timing of this sample window was guided by three considerations. First, we wanted a window long enough to yield a sample that would be large enough to support subgroup analyses, such as a comparison of characteristics across cases that took different paths through the LBP. Second, we wanted a window short enough to make the data collection process efficient and economical given our objective to extract: (1) monthly case benefit histories for the 12-month LBP term and several months after this term from the IABC Case Master File, and (2) demographic characteristics measured near the starting date of the LBP from the IABC Individual Master File. The longer the window, the more versions of these files must be accessed to obtain these data. Third, we faced calendar constraints on the first and last months of the window. In particular, we wanted the first month to be late enough in LBP operation that the program and its data systems were fully implemented for the earliest assignments in our sample. At the other end, we wanted the last month to be early enough in time that we could follow each case for the full 12-month LBP period and three subsequent months.

Taking these factors into account, we selected a six-month sample window beginning in November 1994 and ending in April 1995. This window allowed us to obtain data from just the June 1995 and March 1996 versions of the Case Master File.(2) It also allowed us to use only two versions of the Individual Master File (December 1994 and March 1995) to obtain data within one month of the LBP starting date.

2. Unit of Analysis

The primary unit of analysis for the flow analysis is the case, or welfare benefit unit. Although assignments to the LBP are made for an individual, the LBP assignment affects the entire case to which that individual belongs, as cash assistance to the case is reduced and then terminated.(3) In light of this, we have structured the flow analysis around the case, reporting on the analysis in terms of cases assigned to the LBP, or LBP cases.

To obtain a unique observation per case in the sample for the flow analysis, it was necessary to address the possibility of multiple assignments to the LBP. Multiple assignments can happen for two reasons: (1) repeat assignments, in which a case is reassigned to the LBP after the initial assignment has ended, and (2) concurrent assignments, in which two individuals in a given case, such as a husband and wife, are assigned to the LBP at the same time. We eliminated multiple records per case as follows. First, we restricted our sample to initial assignments to the LBP; that is, we included only cases having an LBP assignment in the sample window and having no LBP assignment prior to that one.(4) This eliminated multiple observations arising from repeat assignments. Second, to eliminate multiple observations arising from concurrent assignments, we selected the single record associated with the case-name person.(5)

3. Resulting Sample

Table III.1 presents the sample for the flow analysis. The total number of LBP cases in the sample is 4,224. As mentioned above, the sample includes one observation per case for each case with a first assignment to the LBP starting in the six-month period from November 1994 through April 1995.(6) During this period, an average of 704 assignments started each month, with a low of 551 in December 1994 and a high of 841 in February 1995.

The 4,224 first assignments to the LBP made during the six-month sample window represent approximately 22 percent of LBP assignments made in the twenty-seven month period from April 1994 (the first month of LBP assignments) through May 1996. The average number of cases starting the LBP per month from April 1994 through May 1996 was approximately 644. This is 60 cases fewer than the average in the six-month sample window of November 1994 through April 1995. This lower average reflects a reduction over time in the number of cases assigned to the LBP that parallels an overall reduction over time in the FIP caseload.

C. REASONS FOR ASSIGNMENT TO THE LBP

Table III.2 presents reasons for assignment to the LBP. Nearly all LBP assignments are the result of failure to take the steps necessary to develop and sign an FIA, as opposed to failure to fulfill requirements once an FIA has been signed. Pre-FIA assignments, that is, assignments made before an FIA has been signed, account for 97 percent of LBP assignments.

Table III.1
Table III.2

Among the specific, administrative reasons for assignment to the LBP, the most common is failure to keep the required appointment with PROMISE JOBS.(7) Approximately 58 percent of LBP assignments are made for this reason. Another 31 percent of LBP assignments are made because of failure to arrange the required PROMISE JOBS appointment in the first place. Thus, a total of 89 percent of LBP assignments result from failure either to make or to keep the required PROMISE JOBS appointment.(8) This represents a high level of noncompliance in the initial stages of the process of developing and signing an FIA. In comparison, only 8 percent of assignments result from noncompliance after individuals attend the PROMISE JOBS appointment but have not yet signed an FIA.

D. CHARACTERISTICS OF LBP CASES AND INDIVIDUALS

Table III.3 presents descriptive statistics on the characteristics of LBP cases and individuals. There is roughly an equal proportion of cases with one, two, and three or more children, respectively:

33 percent include one child, 31 percent include two children, and 36 percent include three or more children. In approximately 71 percent of cases, the youngest person is a child between the ages of 0 and 5 years; in 45 percent of cases, the youngest member is less than 3 years old; and in 26 percent of cases, the youngest member is 3 to 5 years old. Approximately half of the cases reside in a metropolitan area.(9)

Table III.3

In the month immediately prior to the starting date of the LBP assignment, LBP cases received an average of $343 in FIP cash benefits and $206 in Food Stamp benefits. Approximately 8 percent of LBP cases received no FIP benefit in that month, indicating that these cases exited from FIP between the time of their assignment to the LBP and the starting date of the LBP. (10)

The individuals assigned to the LBP are predominantly white, unmarried females. Over 70 percent are currently unmarried: approximately 52 percent have never been married, and another 20 percent have previously been married (currently divorced, separated, or widowed). Just over half have completed at least a high school education. The average age of individuals assigned to the LBP is 28.5 years, and approximately 9 percent are teenagers.

E. PATHS THROUGH THE LBP

Cases can take several paths following their assignment to the LBP. One important path is cancellation of the LBP assignment, which enables the case to return to FIP immediately.(11) Here, we describe the frequency of LBP cancellation and the distribution of LBP cancellations by reason for and timing of cancellation. We also describe the paths taken by cases whose LBP assignments are never canceled. These include the full 12-month LBP and two types of early exit from cash assistance.

1. Cancellation of the LBP

As shown in Table III.4, slightly more than half of the assignments (53 percent) are canceled at some point. In Table III.5, we focus on the LBP assignments that are canceled. The primary reason for cancellation is signing an FIA. In total, nearly 80 percent of LBP assignments are canceled for this reason.

Table III.4
Table III.5

The remaining cancellations are primarily the result of corrections, appeals, or other administrative actions.(12)

Just over one-quarter (26 percent) of cancellations occur before the LBP takes effect, and essentially all of these cancellations are because the client reconsiders and signs an FIA. Another 55 percent of assignments are canceled by the signing of an FIA during one of the two reconsideration periods once the LBP is in progress. Approximately 30 percent of assignments are canceled in the first FIA reconsideration period, which is the first 45 days of the LBP, while approximately 25 percent are canceled in the second FIA reconsideration period, which is the fifth and six months of the LBP.

2. Never-Canceled LBP Assignments

Forty-seven percent of LBP assignments are never-canceled and are thus subject to the full LBP term, including the six-month period of ineligibility for cash assistance during months 7-12. To describe the paths taken by these cases, we examined their monthly receipt of FIP benefits. Table III.6 displays the number and percentage of these cases that exhibit several distinct paths through the LBP. Approximately 64 percent of never-canceled LBP cases exhibit a pattern of FIP benefit receipt that suggests an exit from cash assistance before the six-month period FIP ineligibility, we refer to this as an early exit. We identified two early exit paths: (1) approximately two-fifths of early exits occur before the starting date of the LBP,(13) and (2) approximately three-fifths occur after the LBP starting date but before the point of benefit termination.(14) The remaining 36 percent of never-canceled LBP cases exhibit a third path. Their pattern of benefit receipt is consistent with the full 12-month LBP term. In particular, these cases receive cash benefits during the first six months of the LBP but do not receive them in the second six months of the LBP, the FIP ineligibility period.(15)

Table III.6

F. CHARACTERISTICS BY PATH THROUGH THE LBP

The groups of LBP cases that take different paths through the LBP following assignment differ by case- and individual-level characteristics. Here, we compare canceled LBP cases with never-canceled LBP cases. Also, among never-canceled LBP cases, we compare cases that exit early--meaning that they stop receiving cash assistance prior to benefit termination under the LBP--to those that do not exit early, remaining on the LBP for the full term.

1. Characteristics By LBP Cancellation Status

There are no large differences between the characteristics of the 53 percent of LBP cases whose assignments to the LBP are canceled, enabling them to return to FIP, and the 47 percent whose assignments are never-canceled (Table III.7).(16) However, there is a pattern in the differences that do exist. On average, the cases and individuals with canceled LBP assignments appear to be somewhat more disadvantaged than those with never-canceled assignments. In particular, cases with canceled LBP assignments tend to have slightly more people, more children, and younger children than cases with never-canceled assignments. They also tend to receive higher FIP and Food Stamp benefits in the month prior to the beginning of their LBP assignment.

Table III.7

In terms of the specific individuals who are assigned to the LBP on these cases, those with canceled assignments are more likely than those with never-canceled assignments to be female, nonwhite, unmarried, and not to have completed high school; they are also younger. These differences in case- and individual-level characteristics, although small, suggest that cancellation of the LBP assignment, which enables the case to return to FIP, is somewhat more common among families that are more likely to have a relatively high need for cash assistance, which may be related to a relatively weak attachment to the labor force. We suspect that this need for assistance motivates these families to take the steps required to cancel the LBP assignment so that they can return to FIP.

2. Characteristics by Early Exit Status

Among cases with never-canceled LBP assignments, one distinct path is early exit, by which we mean exit from cash assistance prior to the termination of benefits under the LBP (month 7). Here, we examine how the 64 percent of never-canceled LBP cases that exit early differ from those that do not exit early (those that have benefit patterns consistent with 12 months on the LBP). Table III.8 presents summary statistics on the characteristics of these two groups of never-canceled LBP cases.(17)

Here again, there are no large differences between the two groups of interest, but there is some evidence of a pattern in the differences that do exist. The never-canceled LBP cases that exit early appear to be somewhat less disadvantaged than those that do not exit early. On average, the never-canceled cases that exit early tend to have slightly fewer people overall and fewer children, and to receive lower FIP and Food Stamp benefits in the month prior to the beginning of their LBP assignment than those that do not exit early. The individuals specifically assigned to the LBP on the never-canceled cases that exit early are somewhat more likely than those on cases that do not exit early to be male, white, married, and to have completed high school; they are also slightly older.(18)

Table III.8

G. MONTHLY PATTERNS OF FIP BENEFIT RECEIPT DURING AND AFTER THE LBP

In this section, we describe monthly patterns of FIP benefit receipt over time and compare them for canceled and never-canceled LBP cases. For the set of never-canceled LBP assignments, we highlight whether or not the case returns to FIP after the LBP.

1. Monthly Patterns of FIP Receipt

Table III.9 displays the percentage of cases receiving FIP cash benefits in each of the months 1-12 of the LBP and in each of the first three months after the LBP for all LBP cases, canceled LBP cases, and never-canceled LBP cases.(19) The shading in this table highlights the key periods in the LBP: months 1-3 when cases on the LBP receive regular FIP cash benefits, months 4-6 when cases on the LBP receive reduced FIP cash benefits, and months 7-12 when LBP cases are ineligible for FIP cash benefits.

In month 1 of the LBP assignment, 83 percent of cases receive FIP benefits while 17 percent do not. Additional calculations show that most of these 17 percent are never-canceled LBP cases that leave cash assistance (FIP) by the time the LBP starts.(20) As expected, the largest drop in receipt of FIP benefits among LBP cases occurs at month 7, when the period of ineligibility for cash assistance begins for those remaining on the LBP. Receipt of FIP benefits does not go to zero during the ineligibility period because about half of the LBP assignments have been canceled, enabling these cases to return to FIP immediately following cancellation. In the three months after the end of the LBP term, approximately 38 to 40 percent of all LBP cases receive FIP cash benefits.

Table III.9

Cases with canceled LBP assignments have a high frequency of FIP benefit receipt that declines gradually over time. This high frequency of receipt by the canceled cases is not surprising for two reasons. First, cancellation eliminates the FIP ineligibility period, when no benefits can be received. Second, cancellation is more likely to occur among cases that desire to return to FIP, particularly when cancellation occurs because the client signs an FIA.

As shown in Table III.9, never-canceled LBP cases compared with canceled LBP cases have a lower level of FIP benefit receipt that declines more rapidly. Approximately 72 percent of never-canceled LBP cases are receiving FIP in the first month of the LBP.(21) By month 6, the month prior to FIP benefit termination, only 30 percent of never-canceled cases are receiving FIP. These never-canceled cases are also unlikely to receive FIP after the LBP ineligibility period has ended. In the first month of renewed eligibility, only 12 percent are receiving FIP benefits. In the third month, still less than 20 percent are receiving FIP benefits. These figures are small both in absolute terms and relative to the 30 percent of never-canceled cases receiving FIP in the month before benefit termination and the 62 percent of canceled cases receiving FIP in the first month after the LBP period.

2. Return to FIP After the LBP by Never-Canceled LBP Cases

Table III.10 provides more detail on the frequency of return to FIP after the LBP by cases subject to the full term of the LBP. In particular, it presents the percentage of cases receiving FIP benefits in each of the three months immediately following the LBP for three groups of never-canceled cases corresponding to key paths through the LBP: those who exit before the LBP starts, those who exit after the LBP starts, and those who do not exit early (12 months on the LBP). There is considerable variation from one group to the next in the extent to which cases return to FIP after the LBP. Return to FIP is the lowest among those that exit prior to month 1 of their LBP assignment. Less than 10 percent of these cases receive FIP benefits in any of the first three months of renewed eligibility following LBP month 12. Return to FIP is highest for never-canceled LBP cases that do not exit early. Approximately 34 percent of these cases receive FIP benefits in any of the first three months of renewed eligibility. While 34 percent is high when compared with the comparable figures for the other two groups of never-canceled cases (10 percent and 14 percent), it is quite low when we consider that 100 percent of cases in this particular group--cases that do not exit early--were receiving FIP immediately preceding the ineligibility period.

H. CHARACTERISTICS BY RETURN TO FIP

There are no large differences between the characteristics of the approximately 20 percent of never-canceled cases that return to FIP in the three months after the end of the LBP period and the approximately 80 percent that do not return to FIP in these months (Table III.11).(22) However, there is a pattern in the differences that do exist, and this pattern is similar to the pattern of differences between canceled and never-canceled LBP cases. Recall that canceled LBP cases on average appear to be somewhat more disadvantaged than never-canceled cases. Similarly, never-canceled LBP cases that return to FIP after the 12-month LBP appear to be somewhat more disadvantaged than never-canceled LBP cases that do not return to FIP. In particular, the cases that return have slightly more people and more children, and they receive higher FIP and Food Stamp benefits in the month prior to the beginning of the LBP assignment than cases that do not return. In addition, the specific individuals assigned to the LBP on never-canceled LBP cases that return to FIP are somewhat more likely than those on cases that do not return to be female, nonwhite, unmarried, and to have completed high school; they are also younger. Taken together, Tables III.7 and III.11 suggest that individuals from less advantaged demographic groups (unmarried, females, nonwhites, less educated) with larger households and more young children are somewhat more likely than those from more advantaged groups to return to FIP after being assigned to the LBP--either through cancellation of the LBP assignment or after completing the LBP term.

Table III.10
Table III.11

I. MONTHLY PATTERNS OF FOOD STAMP RECEIPT AND BENEFIT LEVELS

In this section, we describe monthly patterns of Food Stamp benefit receipt and benefit levels over time for cases assigned to the LBP.

1. Monthly Patterns of Food Stamp Receipt

Table III.12 shows the monthly pattern of Food Stamp benefit receipt for all cases assigned to the LBP and for the two groups defined by whether the LBP was ever canceled. The patterns in receipt of Food Stamp benefits are broadly consistent with the patterns in receipt of FIP benefits shown in Table III.9. In each month, cases with canceled LBP assignments are more likely than cases with never-canceled assignments to receive Food Stamp benefits. From month to month, there are also smaller declines in the percentage of cases that receive Food Stamps for cases with canceled LBP assignments than for cases with never-canceled assignments.

Table III.12

While never-canceled LBP cases are not eligible for any FIP cash benefits during months 7-12 of the LBP, there is no such restriction on their receipt of Food Stamps. When eligibility for FIP ends in LBP month 7 for never-canceled cases, the incidence of Food Stamp receipt in this group declines slightly, from 45 percent to 42 percent. During the six-month period of ineligibility for FIP benefits, the percentage of never-canceled LBP cases that receive Food Stamps declines gradually from 42 percent to 35 percent. The lack of increased participation in the Food Stamp program among never-canceled cases when they are ineligible for FIP is consistent with the hypothesis that these cases are relatively less disadvantaged. In the first three months of renewed eligibility for FIP following the LBP, receipt of Food Stamps by never-canceled cases remains constant at approximately 35 percent.

2. Food Stamp Benefit Levels and the Safety Net Hypothesis

Food Stamp benefits may provide a safety net, or cushion, for families when their FIP benefits are reduced and subsequently terminated under the LBP. That is, the Food Stamp benefit level may increase, and as a result may offset some of the decline in household economic resources caused by the loss of FIP benefits. While any such increase in Food Stamp income moderates the household's decline in resources, it also dilutes the incentive effects of the LBP.

Since the potential Food Stamp safety net is most relevant to those cases that experience both the reduction and termination of FIP benefits, we focus the present analysis on the subset of LBP cases that experience these two events--these are the never-canceled LBP cases that exhibit a pattern of FIP receipt consistent with the full 12-month LBP term (full-term LBP cases). To determine whether Food Stamp benefits provide a safety net for full-term LBP cases when FIP benefits are reduced and terminated, we examine the average Food Stamp benefit received on a month-by-month basis. We do this in two ways: (1) for the subset of full-term cases receiving Food Stamps in the current month for LBP months 1-12, and (2) for the subset of full-term cases receiving Food Stamps in all twelve months of the LBP. The results are presented in Table III.13.

Table III.13

There is evidence that Food Stamps provide a small safety net. In particular, there are increases in Food Stamp benefit levels for full-term LBP cases when their FIP cash benefits are reduced and terminated, but these increases are modest. For current month Food Stamp recipients, the average Food

Stamp benefit in months 1-3 of the LBP, when FIP benefits are level, is approximately $247. Then, when FIP benefits are reduced in month 4, the average Food Stamp benefit of current month recipients increases by $21 (9 percent) and remains at this higher level during the three months of reduced benefits (months 4-6). Finally, when FIP benefits are terminated in month 7, the average Food Stamp benefit increases by $25 (9 percent), from $271 in month 6 to $296 in month 7. Throughout the FIP ineligibility period (months 7-12), Food Stamp benefits of full-term LBP cases remain consistently higher than in the earlier months of the LBP, although they tend to decline slightly over time.

One potential critique of the above findings is that the observed increases in Food Stamp benefits among current month recipients over the course of the LBP could to some extent be driven by changes in the composition of Food Stamp recipients. In particular, if less needy cases leave the Food Stamp program over time, the remaining Food Stamp recipients would have higher average benefits aside from any safety net effect. The fact that the increases in Food Stamp benefits so closely match the timing of the FIP reduction and termination under the LBP leads us to believe compositional changes are unlikely to be driving the results. To confirm this, we examine average Food Stamp benefits for the restricted sample of full-term LBP cases that received Food Stamps in all twelve months of the LBP. Since the composition of this sample does not change over time, we can gauge whether compositional changes are driving the increases in Food Stamp benefits observed for current month Food Stamps recipients. It appears that they are not. As shown in the last column of Table III.13, the pattern of Food Stamp benefits is the same for twelve-month recipients as for the current month recipients. In particular, benefits are relatively level in months 1-3, increase $29 (11 percent) in month 4 when FIP benefits are reduced, remain level in months 4-6, increase $32 (11 percent) in month 7 when FIP benefits are terminated, and remain higher (though decline slightly) throughout the FIP ineligibility period. Hence, we conclude that Food Stamps provide a modest safety net for some LBP cases.

J. SUMMARY OF FINDINGS

The flow analysis uses administrative data from the Iowa DHS to examine reasons for assignment to the LBP, characteristics of LBP cases, paths out of the LBP, and the receipt of FIP and Food Stamp benefits by LBP cases. Several major findings emerge from this analysis:


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1. The file also includes information on families that are not in the FIP program but are participating in, or have applied for, Food Stamps or Medicaid. This analysis is restricted to families in the FIP program.

2. A small amount of additional case-level data was obtained from the June 1996 Case Master File, which became available late in the study.

3. In 98 percent of LBP assignments during the sample period, the assignment covered all members of the individual's case.

4. There were 112 LBP assignments in the sample window that were not first assignments to the LBP. Exclusion of these cases brought our sample size down from 4,374 to 4,262.

5. There were 30 cases with multiple records per case with the same starting date in the sample window. Exclusion of these cases brought our sample size from 4,262 to 4,232.

6. Eight observations were excluded due to missing data on key variables of interest. This brought our sample size from 4,232 to 4,224.

7. As mentioned in Chapters 1 and 2, some cases volunteer for assignment to the LBP. The administrative reason for assignment coded for such cases depends on the stage in the FIA process at which they volunteer for the LBP.

8. Even accounting for some voluntary assignments, these findings may suggest that the PROMISE JOBS appointment is the major hurdle in signing the FIA and, in turn, that efforts to facilitate these appointments would be very effective in increasing compliance with the FIA requirement. These results are consistent with the LBP Survey data, which suggests that there is some confusion or lack of understanding about the requirement that the welfare client arrange and attend PROMISE JOBS appointment. They are also consistent with finding that some welfare clients (20 percent of LBP Survey respondents) voluntarily enter the LBP; it is likely that these individuals make an intentional decision not to arrange or keep the PROMISE JOBS appointment.

9. This is defined as residing in a county designated as a Metropolitan Statistical Area (MSA). An MSA must include one city with 50,000 or more inhabitants or a Census Bureau-defined urbanized area of at least 50,000 inhabitants and a total metropolitan population of at least 100,000.

10. There is typically a lag between the date that the LBP assignment is made and the date it takes effect (the starting date).

11. A case whose LBP assignment is not canceled may return to FIP only following the completion of the full term of the LBP (12 months).

12. A small number of observations (52) have no cancellation code in the LBP Master File, but show evidence of cancellation in that they receive FIP benefits in at least two of the months of the FIP ineligibility period of the LBP.

13. In particular, these cases have stopped receiving FIP benefits by the first month of their scheduled LBP assignment and do not receive FIP during the first six months of that assignment.

14. One possible explanation for an early exit from FIP is that the household has raised its income through employment following assignment to the LBP. However, we have no data on earnings for these households and can only speculate as to the role of employment in the early exits.

15. More specifically, these cases have either (1) continuous receipt of FIP benefits during months 1-6 of the LBP and no FIP benefits during months 7-12, or (2) sporadic receipt of FIP benefits during months 1-6 of the LBP and no FIP benefits during months 7-12, as long as there are two months of continuous receipt of FIP benefits preceding the period of no benefits.

16. In Appendix Table A.1, we present the expanded set of characteristics that are in Table III.3 for the two subgroups analyzed here.

17. In Appendix Table A.2, we present the expanded set of characteristics that are in Table III.3 for the two subgroups analyzed here.

18. These differences are consistent with our earlier suggestion that early exits may be correlated with an increase in employment and earnings (see footnote 12). Specifically, the characteristics of those that exit early, relative to those that do not, are suggestive of higher labor force participation and attachment; however, since we have no data on earnings for these households we can only speculate on this issue.

19. Table III.9 presents results for FIP benefit receipt in individual months of the LBP without reference to other months. This differs from the analysis of paths through the LBP for never-canceled cases (Table III.6), which focuses on patterns in benefit receipt across months.

20. In addition, some of these cases are: (1) canceled LBP cases, and (2) other never-canceled LBP cases that have benefit receipt that is generally consistent with 12 months on the LBP but includes some sporadic receipt in months 1-6, including none in month 1.

21. This implies that 28 percent are not receiving FIP as of month 1. This is slightly higher than the percent of never-canceled LBP cases (26 percent) that are classified as exhibiting an early exit before the LBP starts (Table III.6). This can be explained by the fact that a small number of the never-canceled LBP cases that are classified as having FIP benefit receipt consistent with the 12-month LBP do not actually receive FIP benefits in month 1 of the LBP (this is explained further in the notes to Table III.6).

22. In Appendix Table A.3, we present the expanded set of characteristics that are in Table III.3 for the two subgroups analyzed here.