Welfare Plan Keeps Mothers in School : Research: Study on Ohio’s system of rewards and penalties is viewed by Wilson Administration as support for its own similar proposal.

Programs that provide a system of rewards and penalties to encourage teen-age welfare mothers to stay in school are showing early success at reducing the dropout rate among poor young parents, a study concludes.

The research, which focuses on an Ohio program, was viewed by the Wilson Administration as a strong boost for its efforts to create a similar program aimed at teen-age mothers in California.

The release of the new data today comes a week before the Democrat-controlled Legislature is expected to consider Gov. Pete Wilson’s proposals for a series of changes in the welfare system that include not only the creation of the program for teen-age parents but also proposals for sharp reductions in benefits, expansion of a work training program and penalties for parents who have additional children while they are receiving government aid.

“It makes a lot of sense that there should be some incentive for teen-agers to finish high school while they are on welfare. Now we know there are steps the state can take that will in fact work to keep them in school,” said Amy Albright, spokeswoman for the California Department of Social Services.

The findings by the nonprofit Manpower Demonstration Research Corp. provide the first comprehensive research on a welfare program designed to encourage teen-age mothers to finish school through a combination of financial incentives, counseling and child care assistance.

Manpower Demonstration Research, a New York-based organization founded in 1974 by the Ford Foundation and a consortium of federal agencies, examined 7,000 teen-age parents and compared a group that participated in the program to a group that did not.

The organization found that the program was successful on two fronts: It reduced the school dropout rate for teen-age mothers and it persuaded some teen-age mothers to go back to school.

Although some states, including California, are considering ways to address the problems of teen-age mothers, Ohio is one of the first to embark on a large-scale program targeting young parents on welfare.

Welfare experts believe teen-age pregnancy to be a major cause of long-term welfare dependency because so many young mothers become high school dropouts and fail to get educations to help them find jobs. Although the number of teen-age mothers on welfare is usually small, Manpower Demonstration researchers said that more than half of all welfare households in the United States are headed by women who first gave birth as teen-agers.

The Ohio program, called LEAP (Learning, Earning and Parenting), uses a system of rewards and sanctions by providing a $62 monthly bonus to every teen-age welfare mother who stays in school. Teen-age mothers who drop out of school are punished by having their welfare grants reduced by $62 for every month that they are either not in school or have excessive unexcused absences.

Teen-agers who attend school are eligible for child care and transportation assistance, and each is assigned a case manager who provides counseling. The program is relatively low-cost--about $330 a year for each recipient.

Researchers found that 61.3% of the teen-age mothers in the LEAP program remained in school while only 51.1% of those in the group not participating in the program continued their educations. Of those teen-age parents who had dropped out of school, 46.8% returned after joining the LEAP program. However, only 33.4% of those who were not in the program chose to go back to school.

“This is the first evidence that we have that something of scale may actually be able to at least take the first step of keeping these young women in school,” said Judith M. Gueron, the research company’s president.

However, David Long, co-author of the report, cautioned that the research was relevant only to programs like Ohio’s.

Although Wilson’s proposal is modeled after the Ohio plan, it has a major difference. Instead of a monthly bonus for remaining in school, it allows for a $100 bonus when recipients pass each grade level and $500 when they graduate from high school.