The federal government has approved Nebraska’s request to restrict Temporary Assistance for Needy Families (TANF) benefits for purchases of tobacco, tattoos, psychic readings, video games and other items deemed nonessential.
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Federal Approval and Expanded Restrictions
U.S. Assistant HHS Secretary Alex Adams approved Nebraska’s plan amendment on Tuesday, four days after Governor Jim Pillen submitted the request. The changes expand the list of prohibited TANF purchases beyond previous limits on liquor, casino gambling and adult entertainment. Under the new rules, beneficiaries cannot use funds for drugs, pornography, vaping products, body art, lottery tickets, sports betting, music or gaming subscriptions, and video game content.
Cash withdrawals are limited to in-person transactions at financial institutions or SNAP-authorized retailers. Nebraska’s average TANF benefit is $470 per month, serving 2,856 households as of January 2026, according to the state Department of Health and Social Services. The average household size is 2.7 people. TANF provides temporary financial assistance to low-income families with children, typically used for rent, childcare and utilities while participants engage in workforce development programs.
Governor Pillen’s Rationale and Implementation
Pillen stated that allowing taxpayer funds for items like tobacco, gambling and video games is unacceptable. “The inappropriate use of public funds will end at my direction,” he said in a Friday statement. The state DHHS will work with ReliaCard, its EBT card vendor, to implement the merchant category list immediately, with a firmer timeline expected in coming weeks.
Adams praised Pillen’s leadership, noting that Nebraska is the second state to pursue such restrictions after Florida’s request in late August. Other states are in “active conversations” about similar measures, according to Adams. He emphasized that TANF should serve as a temporary bridge to workforce participation, not a catch-all for nonessential items.
Nonprofit Criticism and Program Debate
Nonprofit Nebraska Appleseed criticized the change as stigmatizing to low-wage parents working to improve their circumstances. The organization stated that approximately 2,700 Nebraska families use TANF for basic necessities and called the move “an invention that stigmatizes” recipients. Their statement described the effort as “detached from reality and the opposite of what we need in Nebraska right now.”
Adams countered that restricting nonessential purchases removes stigma by emphasizing TANF’s role as a hand up rather than a handout. He argued that clearly defined legitimate uses help legitimize the program. The debate reflects broader discussions about TANF’s purpose decades after its 1996 inception, when it replaced Aid to Families with Dependent Children with a block grant system giving states more flexibility.
Historical Context and Future Considerations
TANF celebrated its 30th anniversary this summer, prompting HHS to revisit its original design with architects like former House Speaker Newt Gingrich and former Wisconsin Governor Tommy Thompson. He noted that while the program succeeded in reducing caseloads, it has become stagnant over time. The current push seeks to reinvigorate state leadership and refocus benefits on temporary assistance during workforce transition.
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