SECTION 12. CHILD PROTECTION, FOSTER CARE, AND ADOPTION ASSISTANCE * --------------------------------------------------------------------------- * The Personal Responsibility and Work Opportunity Reconciliation Act of 1996 changed this program; see appendix L for details. --------------------------------------------------------------------------- CONTENTS Background Federal Child Welfare Programs Today The Title IV-B Child Welfare Services Program The Title IV-E Foster Care Program The Title IV-E Adoption Assistance Program The Title IV-E Independent Living Program Protections for Children in Foster Care Protections Linked To Title IV-B Child Welfare Services Funding Mandatory Protections for Foster Children Funded Under Title IV-E Reasonable Efforts Requirement State Compliance With Section 427 Child Protections Federal Financial Review Procedures Under Title IV-E New Conformity Review System Under Public Law 103-432 Recent Trends Affecting Child Welfare Populations and Programs Child Abuse and Neglect Child Abuse Fatalities Substance Abuse Trends in Foster Care Caseloads Increase in ``Kinship'' Care Family Preservation Programs National Data on Foster Care and Adoption Assistance Characteristics of Children in Substitute Care Reasons for Placement in Substitute Care Permanency Goals Living Arrangements of Children in Substitute Care Number and Duration of Placements While in Foster Care Outcomes for Children Leaving Care Characteristics of Children in Adoptive Care Trends in Child Welfare and Foster Care Costs Foster Care and Adoption Information System Lack of Adequate Data OBRA 1993 and Final Rules for AFCARS and SACWIS Legislative History References BACKGROUND Child welfare services aim to improve the conditions of children and their families and to improve or provide substitutes for functions parents have difficulty in performing. Child welfare services encompass a broad range of activities, including protection of abused or neglected children, support and preservation of families, care of the homeless and neglected, support for family development, and provision of out-of-home care. Services may help the family cope with problems or they may protect children while the family learns to perform appropriate parenting roles. It is generally agreed that it is in the best interests of children to live with their families. To this end, experts emphasize both the value of preventive and rehabilitative services and the need to limit the duration of foster care placements. However, if children must be removed, a major principle of professional social work is the provision of permanent living arrangements, either by returning children to their homes in a timely fashion or by moving children into adoption or other permanent arrangements. Many private, nonprofit and government entities work to provide child welfare services to families in need. The primary responsibility for child welfare services in the government, however, rests with the States. Each State has its own legal and administrative structures and programs that address the needs of children. The Federal Government has also been involved in efforts to improve the welfare of children in specific areas of national concern since the early 1900s. Almost 40 Federal programs provide support for such services today, administered by four different Cabinet agencies and overseen by five House committees (Robinson & Forman, 1994). The largest of these programs are authorized under titles IV-B and IV-E of the Social Security Act. Additional programs include grants to States, local governments and nongovernmental agencies for prevention and treatment of child abuse and neglect, advocacy centers for victims of sexual abuse, services for abandoned infants and children with AIDS, promotion of adoption, child abuse-related training for judicial personnel, federally administered research and demonstration, Indian Child Welfare Programs, Family Violence Programs, and a number of small programs. Of the 38 programs, 26 had funding of less than $25 million in 1995. In addition, services related to child welfare may be provided at State discretion under the social services block grant (title XX of the Social Security Act), described in section 11. This section will focus specifically on child welfare, foster care and adoption assistance programs authorized under titles IV-B and IV-E of the Social Security Act. Title IV-B authorizes funds to States for a broad range of child welfare services, including family preservation and family support services; title IV-E authorizes the Foster Care, Independent Living, and Adoption Assistance Programs. The IV-B and IV-E programs are intended to operate in consort to help prevent the need for out-of-home placement of children, and in cases where such placement is necessary, to provide protections and permanent placement for the children involved. Funding is provided under the Foster Care Program to assist States with the maintenance costs of low-income (AFDC-eligible) children in foster care. The Independent Living Program is intended to help States facilitate the transition of older children from foster care to independent living; the Adoption Assistance Program helps States support the adoption of AFDC- or SSI-eligible children with ``special needs,'' such as minority status, age, membership in a sibling group, or a mental or physical handicap. FEDERAL CHILD WELFARE PROGRAMS TODAY The Social Security Act contains the primary sources of Federal funds available to States for child welfare, foster care, and adoption activities. These funds include both nonentitlement authorizations (for which the amount of funding available is determined through the annual appropriations process) and authorized entitlements (under which the Federal government has a binding obligation to make payments to any person or unit of government that meets the eligibility criteria established by law). The programs include the Title IV-B Child Welfare Services and Family Preservation Programs, the Title IV-E Foster Care Program, the Title IV-E Adoption Assistance Program, and the Title XX Social Services Block Grant Program. Table 12-1 lists these programs, as well as the Title IV-E Independent Living Program, and describes their funding. Table 12-2 provides data on the level of Federal funds provided to States under titles IV-B and IV-E for fiscal years 1985 through 1995, and HHS projections for fiscal years 1996 through 2001. Under the Title XX Social Services Block Grant Program, States have discretion over what portion of their allocation they spend on child welfare activities, as well as a range of other activities not directly focused on children. Detailed data on child welfare services spending by States under the Title XX Program are not available. In addition to the funds allocated to the States or available on an entitlement basis, approximately $10.8 million was appropriated for fiscal year 1995 for research and demonstration activities and for direct Federal grants to public and private entities for child welfare staff training. These activities are authorized under section 426 of title IV- B. For fiscal year 1996, $2 million is appropriated for training and no funding is appropriated for research under section 426. Funds available to States from the Title IV-B Child Welfare Program may be used for services to families and children without regard to their eligibility for AFDC. Federal matching funds for foster care maintenance payments under title IV-E are only provided in those cases where the child would have been eligible for AFDC if still in the home. All children determined to have ``special needs'' related to their being adopted, as defined under title IV-E, are eligible for reimbursement of certain nonrecurring costs of adoption under the Title IV-E Adoption Assistance Program. However, only AFDC- or SSI- eligible ``special needs'' children qualify for federally matched adoption assistance payments available under title IV- E. Funds available to States for the Title IV-E Independent Living Program may be used for services which facilitate the transition of children from foster care to independent living, regardless of whether they are eligible for AFDC foster care assistance. TABLE 12-1.--FUNDING ENVIRONMENT OF THE FEDERAL PROGRAMS WHICH SUPPORT FOSTER CARE, CHILD WELFARE, AND ADOPTION SERVICES ---------------------------------------------------------------------------------------------------------------- Program Budgetary classification Federal support of total ---------------------------------------------------------------------------------------------------------------- Title IV-E Foster Care Program: Foster care assistance payments...... Authorized entitlement................. Open-ended Federal match at Medicaid rate. Placement services and administrative Authorized entitlement................. Open-ended Federal match of costs. 50 percent. \1\ Training expenses.................... Authorized entitlement................. Open-ended Federal match of 75 percent. Title IV-E Adoption Assistance Program: Adoption assistance payments......... Authorized entitlement................. Open-ended Federal match at Medicaid rate. Nonrecurring adoption expenses....... Authorized entitlement................. Open-ended Federal match of 50 percent. \2\ Placement services and administrative Authorized entitlement................. Open-ended Federal match of costs. 50 percent. Training expenses.................... Authorized entitlement................. Open-ended Federal match of 75 percent. Title IV-E Independent Living Program.... Authorized entitlement................. 100 percent Federal funding, with a funding ceiling. \3\ Title IV-B Child Welfare Services Program: Child welfare services (subpart 1)... Nonentitlement authorization........... Federal match of 75 percent, total capped at State allotment. Family preservation and family Authorized entitlement................. Federal match of 75 percent, support (subpart 2). with a funding ceiling. \4\ Title XX Social Services Block Grant Authorized entitlement................. 100 percent Federal funding, Program. with a funding ceiling. ---------------------------------------------------------------------------------------------------------------- \1\ Seventy-five percent matching is available from fiscal year 1994 through fiscal year 1996 for certain costs related to data collection. \2\ The Federal Government reimburses 50 percent of up to $2,000 of expenditures for any one placement. \3\ Beginning for fiscal year 1991, States are required to provide 50 percent matching for any Federal funding claimed that exceeds $45 million. \4\ Program authorized through fiscal year 1998. Source: Compiled by House Committee on Ways and Means staff. Table 12-3 provides data on participation under the Title IV-B and IV-E Programs. Table 12-4 shows the Congressional Budget Office projections for Federal foster care and adoption assistance for 1996 through 2001 under current law. Between 1996 and 2001, the federally funded foster care caseload is projected to increase from 278,000 to 350,000 (26 percent). Total IV-E foster care costs are expected to increase 49 percent, from $3,213,000 in 1996 to $4,794,000 in 2001. Over the same time period, the adoption assistance caseload is projected to increase from 121,000 to 191,000 (58 percent), while total adoption assistance costs are estimated to increase from $479 million to $901 million (88 percent). TABLE 12-2.--FEDERAL FUNDING FOR CHILD WELFARE, FOSTER CARE, AND ADOPTION ACTIVITIES UNDER TITLES IV-B AND IV-E OF THE SOCIAL SECURITY ACT, 1985-2001 [In millions of dollars] ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ Title IV-B- Title IV-E foster care State claims Title IV-E adoption assistance State 1 child Title IV-B-2 -------------------------------------------- Title IV-E claims Fiscal year welfare family independent ----------------------------------------- Total services preservation Total \1\ Maintenance Administration/ living Assistance Administration/ and support payments training \2\ program Total \3\ payments training ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ 1985................................................. 200.0 ............ 546.2 355.3 190.9 ........... 41.8 31.6 10.2 788.0 1986................................................. 198.1 ............ 605.4 391.6 213.8 ........... 55.0 40.6 14.4 858.5 1987................................................. 222.5 ............ 792.6 479.7 312.9 45.0 73.7 53.9 19.8 1,133.8 1988................................................. 239.4 ............ 891.1 548.3 342.8 45.0 97.1 74.1 23.0 1,272.6 1989................................................. 246.7 ............ 1,153.1 646.0 507.1 45.0 110.5 86.2 24.3 1,555.3 1990................................................. 252.6 ............ 1,473.2 835.0 638.2 50.0 135.7 104.9 30.8 1,911.5 1991................................................. 273.9 ............ 1,819.2 1,030.4 788.8 60.0 175.3 130.3 45.0 2,328.4 1992................................................. 273.9 ............ 2,232.8 1,203.8 1,029.0 70.0 219.6 161.4 58.2 2,796.3 1993................................................. 294.6 ............ 2,547.0 1,365.0 1,182.0 70.0 272.4 197.3 75.1 3,184.0 1994................................................. 294.6 60.0 2,606.5 1,412.0 1,190.5 70.0 325.0 235.0 90.0 3,356.1 1995................................................. 292.0 150.0 3,050.2 1,594.5 1,455.7 70.0 411.4 306.3 105.1 3,973.6 1996 (estimate)...................................... 277.4 225.0 3,332.8 1,706.9 1,625.9 70.0 482.5 359.5 123.0 4,387.7 1997 (estimate)...................................... 292.0 240.0 3,603.7 1,914.9 1,688.8 70.0 554.8 413.2 141.6 4,760.5 1998 (estimate)...................................... 292.0 255.0 3,926.0 2,093.6 1,832.4 70.0 624.6 465.3 159.3 5,167.6 1999 (estimate)...................................... 292.0 NA 4,273.3 2,287.3 1,986.0 70.0 701.5 522.5 179.0 5,336.8 2000 (estimate)...................................... 292.0 NA 4,652.1 2,498.2 2,153.9 70.0 787.5 586.5 201.0 5,801.6 2001 (estimate)...................................... 292.0 NA 5,074.2 2,728.7 2,345.5 70.0 876.6 652.9 223.7 6,312.8 ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ \1\ Total includes administration and training expenditures, as well as maintenance payments, but does not include transfers to the Title IV-B Child Welfare Services Program. Differences in total due to rounding. \2\ Includes regular administration, State automated child welfare information system (SACWIS) costs, and training. \3\ Total includes administration and training expenditures, maintenance payments, and nonrecurring payments. NA--Not available. Source: U.S. Department of Health and Human Services. TABLE 12-3.--PARTICIPATION IN CHILD WELFARE, FOSTER CARE, AND ADOPTION ACTIVITIES UNDER TITLES IV-B AND IV-E OF THE SOCIAL SECURITY ACT, 1983-2001 ---------------------------------------------------------------------------------------------------------------- Title IV- B-1 child Title IV-B-2 Title IV-E Title IV-E Title IV-E Fiscal year welfare family foster care Independent adoption services preservation assistance Living assistance and support payments \1\ Program \2\ payments \1\ ---------------------------------------------------------------------------------------------------------------- 1983.......................................... NA ............ 97,370 ........... 5,309 1984.......................................... NA ............ 102,051 ........... 11,581 1985.......................................... NA ............ 109,122 ........... 16,009 1986.......................................... NA ............ 110,586 ........... 21,989 1987.......................................... NA ............ 118,549 20,182 27,588 1988.......................................... NA ............ 132,757 18,931 34,698 1989.......................................... NA ............ 156,871 44,191 40,666 1990.......................................... NA ............ 167,981 44,365 44,024 1991.......................................... NA ............ 202,687 45,284 54,818 1992.......................................... NA ............ 222,315 57,360 68,197 1993.......................................... NA ............ 232,668 57,918 78,044 1994.......................................... NA NA 244,473 71,081 91,872 1995.......................................... NA NA 260,737 73,137 106,880 1996 (estimated).............................. NA NA 267,400 NA 119,900 1997 (estimated).............................. NA NA 285,000 NA 131,200 1998 (estimated).............................. NA NA 296,400 NA 140,400 1999 (estimated).............................. NA ............ 308,300 NA 150,200 2000 (estimated).............................. NA ............ 320,600 NA 160,700 2001 (estimated).............................. NA ............ 333,400 NA 170,300 ---------------------------------------------------------------------------------------------------------------- \1\ Average monthly number of recipients. \2\ Estimated. NA--Not available. Source: U.S. Department of Health and Human Services. The Title IV-B Child Welfare Services Program Grants to States for child welfare services The Child Welfare Services Program under subpart 1 of title IV-B permanently authorizes 75 percent Federal matching grants to States for services that protect the welfare of children. These services: address problems that may result in neglect, abuse, exploitation or delinquency of children; prevent the unnecessary separation of children from their families and restore children to their families, when possible; place children in adoptive families when appropriate; and assure adequate foster care when children cannot return home or be placed for adoption. There are no Federal income eligibility requirements for the receipt of child welfare services. TABLE 12-4.--CBO BASELINE PROJECTIONS FOR THE FEDERAL FOSTER CARE AND ADOPTION ASSISTANCE PROGRAMS, 1996-2001 [By fiscal year, In millions of dollars] ---------------------------------------------------------------------------------------------------------------- Program 1996 1997 1998 1999 2000 2001 ---------------------------------------------------------------------------------------------------------------- Foster care: Title IV-E caseload (thousands).................. 278 293 308 323 337 350 Average monthly maint. payment (Federal share).............. $514 $540 $568 $596 $626 $657 Federal costs (millions): Maintenance payments........ 1,712 1,899 2,102 2,310 2,528 2,756 Administrative and child placement services......... 1,352 1,407 1,509 1,603 1,715 1,828 Training.................... 150 160 172 184 196 210 ----------------------------------------------------------------------------- Total claims.............. 3,213 3,467 3,782 4,096 4,440 4,794 ============================================================================= Adoption assistance: Title IV-E caseload (thousands).................. 121 135 149 163 177 191 Average monthly payment....... $247 $258 $268 $279 $290 $301 Federal costs (millions): Maintenance payments........ 359 417 479 545 615 690 Administrative and child placement services......... 104 119 134 149 165 181 Training.................... 16 18 21 24 26 29 ----------------------------------------------------------------------------- Total claims.............. 479 554 634 718 806 901 ============================================================================= Independent living: Federal costs. 70 70 70 70 70 70 ============================================================================= Total costs....................... 3,695 4,034 4,418 4,815 5,241 5,687 ---------------------------------------------------------------------------------------------------------------- Note.--Numbers may not add to totals due to rounding. Source: Congressional Budget Office, March 1996 baseline. Under legislation enacted in 1980 (Public Law 96-272), States are limited in the amount of their title IV-B allotments that may be used for child day care, foster care maintenance payments, and adoption assistance payments. Specifically, States may use no more than their portion of the first $56.6 million in Federal IV-B appropriations for these three activities. The intent of this restriction is to devote as much title IV-B funding as possible to supportive services that could prevent the need for out-of-home placement. In addition, States are required to implement certain foster care protections for all children in foster care to be eligible to receive their full allotment of Federal title IV-B appropriations. (The foster care protections are described later in this section.) Between 1977 and 1990, the annual authorization level for the Child Welfare Services Program remained flat at $266 million. The authorization level was increased to $325 million under Public Law 101-239 beginning for fiscal year 1990. Appropriations for the program--the amount of money Congress actually made available for spending each year--increased from $163.6 million in fiscal year 1981 to $294.6 million in fiscal year 1994 (see table 12-2). Appropriations have since decreased, to $292 million in fiscal year 1995 and $277.4 million in fiscal year 1996. Child welfare services funds are distributed to States on the basis of their under-21 population and per capita income. Because of minimal reporting requirements under the program, there are no reliable National or State-by-State data on the exact number of children served, their characteristics, or the services provided. Table 12-5 details the State-by-State distribution of child welfare services funds for selected fiscal years. Grants to States for family preservation and support services Grants to States for family preservation and family support services were authorized as a capped entitlement under subpart 2 of title IV-B, beginning in fiscal year 1994. States already had the flexibility to expend their child welfare services funds available under subpart 1 of title IV-B for family support and preservation services, but few States used a significant share of such funds for these two categories of services. Entitlement funding is authorized for 5 years at the following ceiling levels: $60 million in fiscal year 1994; $150 million in fiscal year 1995; $225 million in fiscal year 1996; $240 million in fiscal year 1997; and either $255 million in fiscal year 1998 or the fiscal year 1997 level adjusted for inflation, whichever is greater. From these ceiling amounts, $2 million in fiscal year 1994 and $6 million in each of fiscal years 1995-98 are reserved for use by the Secretary of HHS to fund research, training, technical assistance and evaluation of family preservation and support activities. In addition, $5 million in fiscal year 1995 and $10 million in each of the subsequent three fiscal years are reserved for a grant program for State courts (described below). Finally, 1 percent of the family preservation and family support entitlement is reserved for allotment to Indian tribes. Table 12-6 shows State allotments of family preservation and family support entitlement funds in fiscal years 1994-96, and estimated State allotments for fiscal years 1997-98. TABLE 12-5.-- STATE-BY-STATE ALLOCATIONS FOR TITLE IV-B CHILD WELFARE SERVICES, SELECTED YEARS 1987-96 [In thousands of dollars] ---------------------------------------------------------------------------------------------------------------- Fiscal year ----------------------------------------------------------------------------- State 1987 1989 1992 1993 1994 1995 1996 actual actual actual actual actual actual allotments ---------------------------------------------------------------------------------------------------------------- Alabama........................... 4,783 5,136 5,432 5,798 5,623 5,512 5,106 Alaska............................ 417 294 614 675 754 756 725 Arizona........................... 3,344 3,797 4,418 4,781 5,034 5,036 5,015 Arkansas.......................... 2,838 3,095 3,273 3,496 3,424 3,387 3,178 California........................ 20,445 23,100 27,289 30,049 31,732 31,575 31,049 Colorado.......................... 2,772 3,091 3,558 3,845 3,866 3,904 3,719 Connecticut....................... 2,081 2,143 1,942 2,066 2,120 2,077 2,052 Delaware.......................... 570 654 717 764 726 720 713 District of Columbia.............. 386 432 431 448 447 427 345 Florida........................... 9,105 10,361 11,773 12,946 13,146 13,096 12,781 Georgia........................... 6,622 7,301 7,737 8,386 8,426 8,418 8,032 Hawaii............................ 656 1,119 1,180 1,281 1,204 1,205 1,117 Idaho............................. 1,304 1,388 1,581 1,734 1,703 1,719 1,622 Illinois.......................... 9,932 10,773 11,338 12,157 11,773 11,634 11,067 Indiana........................... 5,572 6,064 6,709 7,115 6,952 6,832 6,367 Iowa.............................. 2,861 3,074 3,364 3,566 3,475 3,402 3,223 Kansas............................ 2,150 2,461 2,885 3,083 3,068 3,034 2,873 Kentucky.......................... 4,154 4,556 4,883 5,192 5,030 4,961 4,624 Louisiana......................... 5,106 5,657 6,350 6,750 6,527 6,412 5,910 Maine............................. 1,313 1,391 1,443 1,533 1,482 1,455 1,378 Maryland.......................... 3,440 3,798 3,924 4,256 4,343 4,291 4,168 Massachusetts..................... 2,714 4,418 4,336 4,567 4,708 4,597 4,579 Michigan.......................... 8,888 9,551 10,196 10,860 10,885 10,634 10,075 Minnesota......................... 3,937 4,206 4,753 5,093 5,092 5,070 4,785 Mississippi....................... 3,519 3,923 4,177 4,438 4,293 4,245 3,949 Missouri.......................... 4,958 5,235 5,798 6,218 6,146 6,072 5,727 Montana........................... 978 1,049 1,136 1,212 1,207 1,220 1,158 Nebraska.......................... 1,641 1,744 1,996 2,137 2,071 2,032 1,879 Nevada............................ 775 964 1,170 1,326 1,401 1,430 1,379 New Hampshire..................... 950 1,024 1,028 1,078 1,087 1,074 1,096 New Jersey........................ 5,424 5,465 4,936 5,308 5,224 5,193 5,388 New Mexico........................ 1,642 2,072 2,291 2,493 2,510 2,526 2,418 New York.......................... 13,529 14,373 14,490 15,530 15,452 15,231 14,148 North Carolina.................... 6,432 7,189 7,771 8,326 8,112 8,086 7,728 North Dakota...................... 750 849 942 983 945 929 858 Ohio.............................. 10,402 10,429 12,283 13,053 12,878 12,748 11,853 Oklahoma.......................... 3,332 3,735 4,144 4,428 4,406 4,374 4,133 Oregon............................ 2,586 2,850 3,283 3,576 3,556 3,555 3,321 Pennsylvania...................... 10,038 11,236 11,905 12,650 12,148 11,949 11,076 Rhode Island...................... 888 953 1,025 1,070 1,054 1,032 984 South Carolina.................... 4,015 4,468 4,747 5,101 4,948 4,867 4,544 South Dakota...................... 853 938 1,038 1,107 1,075 1,077 991 Tennessee......................... 5,001 5,598 5,933 6,329 6,210 6,166 5,792 Texas............................. 16,243 18,958 21,845 23,688 23,795 23,796 22,401 Utah.............................. 2,555 2,891 3,196 3,478 3,474 3,481 3,284 Vermont........................... 632 583 713 750 715 699 674 Virginia.......................... 4,907 5,463 5,891 6,322 6,373 6,323 6,114 Washington........................ 3,774 4,382 5,169 5,668 5,699 5,741 5,231 West Virginia..................... 2,226 2,397 2,454 2,565 2,486 2,417 2,789 Wisconsin......................... 4,672 5,077 5,639 6,033 6,022 5,950 5,574 Wyoming........................... 101 382 703 751 724 719 638 American Samoa.................... NA 163 175 183 193 190 183 Guam.............................. 304 342 376 395 351 346 328 Northern Marianas................. 110 118 124 127 142 140 135 Puerto Rico....................... 3,671 3,674 7,094 7,532 8,105 7,951 7,480 Virgin Islands.................... 202 295 311 328 280 276 263 ----------------------------------------------------------------------------- Total....................... 222,500 246,679 273,911 294,624 294,624 291,989 277,389 ---------------------------------------------------------------------------------------------------------------- NA--Not applicable; jurisdiction not eligible under statute. Note: Totals may differ from sum of State amounts due to rounding. Source: U.S. Department of Health and Human Services. TABLE 12-6.--TITLE IV-B FAMILY PRESERVATION AND FAMILY SUPPORT SERVICES STATE ALLOTMENTS, FISCAL YEARS 1994-98 -------------------------------------------------------------------------------------------------------------------------------------------------------- Estimated fiscal Estimated fiscal State Fiscal year 1994 Fiscal year 1995 Fiscal year 1996 year 1997 year 1998 allotments allotments allotments allotments allotments -------------------------------------------------------------------------------------------------------------------------------------------------------- Alabama.................................................. $1,199,639 $2,880,911 $4,167,863 $4,467,573 $4,767,282 Alaska................................................... 77,754 186,726 300,567 322,181 343,794 Arizona.................................................. 1,005,253 2,414,096 3,767,107 4,037,998 4,308,890 Arkansas................................................. 577,604 1,387,105 2,023,818 2,169,350 2,314,882 California............................................... 6,925,694 16,631,924 25,989,033 27,857,894 29,726,755 Colorado................................................. 616,481 1,480,468 2,184,121 2,341,180 2,498,239 Connecticut.............................................. 444,311 1,067,004 1,643,100 1,761,255 1,879,409 Delaware................................................. 105,524 253,413 400,756 429,574 458,393 District of Columbia..................................... 194,386 466,814 701,323 751,755 802,187 Florida.................................................. 2,615,879 6,281,986 10,479,771 11,233,368 11,986,964 Georgia.................................................. 1,555,088 3,734,514 5,891,114 6,314,742 6,738,370 Hawaii................................................... 194,386 349,853 681,285 730,276 779,267 Idaho.................................................... 155,509 373,451 581,096 622,883 664,669 Illinois................................................. 2,504,802 6,015,235 8,716,445 9,343,241 9,970,037 Indiana.................................................. 938,606 2,254,046 3,566,729 3,823,211 4,079,693 Iowa..................................................... 427,649 1,026,991 1,462,760 1,567,946 1,673,133 Kansas................................................... 372,110 893,616 1,342,533 1,439,074 1,535,615 Kentucky................................................. 1,083,007 2,600,822 3,706,994 3,973,562 4,240,131 Louisiana................................................ 1,888,321 4,534,767 6,392,059 6,851,710 7,311,361 Maine.................................................... 244,371 586,852 901,701 966,542 1,031,383 Maryland................................................. 760,882 1,827,244 2,765,217 2,964,063 3,162,908 Massachusetts............................................ 960,822 2,307,396 3,426,464 3,672,860 3,919,256 Michigan................................................. 2,304,862 5,535,083 7,694,517 8,247,827 8,801,136 Minnesota................................................ 655,358 1,573,831 2,384,499 2,555,967 2,727,435 Mississippi.............................................. 1,155,208 2,774,210 3,947,447 4,231,307 4,515,166 Missouri................................................. 1,149,654 2,760,873 4,187,901 4,489,051 4,790,202 Montana.................................................. 133,293 320,101 480,907 515,489 550,071 Nebraska................................................. 233,263 560,177 841,588 902,106 962,624 Nevada................................................... 161,063 386,789 681,285 730,276 779,267 New Hampshire............................................ 94,416 226,738 380,718 408,096 435,473 New Jersey............................................... 1,132,992 2,720,860 3,927,410 4,209,828 4,492,247 New Mexico............................................... 455,419 1,093,679 1,723,251 1,847,169 1,971,088 New York................................................. 4,043,228 9,709,736 14,046,501 15,056,579 16,066,658 North Carolina........................................... 1,160,762 2,787,548 4,408,317 4,725,317 5,042,318 North Dakota............................................. 99,970 240,076 340,643 365,138 389,634 Ohio..................................................... 2,782,496 6,682,112 9,437,806 10,116,475 10,795,144 Oklahoma................................................. 694,236 1,667,194 2,524,763 2,706,318 2,887,873 Oregon................................................... 510,957 1,227,055 1,903,591 2,040,478 2,177,364 Pennsylvania............................................. 2,360,401 5,668,459 8,175,424 8,763,316 9,351,207 Rhode Island............................................. 188,832 453,477 701,323 751,755 802,187 South Carolina........................................... 805,313 1,933,945 2,905,482 3,114,414 3,323,346 South Dakota............................................. 127,739 306,764 440,832 472,532 504,232 Tennessee................................................ 1,327,378 3,187,674 4,929,300 5,283,764 5,638,228 Texas.................................................... 5,376,160 12,910,748 19,617,010 21,027,662 22,438,314 Utah..................................................... 294,356 706,890 1,062,004 1,138,372 1,214,740 Vermont.................................................. 105,524 253,413 380,718 408,096 435,473 Virginia................................................. 927,499 2,227,371 3,486,578 3,737,296 3,988,015 Washington............................................... 938,606 2,254,046 3,306,238 3,543,988 3,781,738 West Virginia............................................ 572,050 1,373,768 2,364,461 2,534,488 2,704,516 Wisconsin................................................ 821,975 1,973,957 2,745,179 2,942,584 3,139,989 Wyoming.................................................. 77,754 186,726 260,491 279,223 297,955 American Samoa........................................... 90,857 122,095 154,717 160,919 167,122 Guam..................................................... 129,726 219,181 264,143 278,357 292,571 Northern Mariana......................................... 80,428 96,047 119,418 123,036 126,654 Puerto Rico.............................................. 1,442,746 3,498,785 5,618,957 6,025,218 6,431,479 Virgin Islands........................................... 117,401 188,397 214,725 225,321 235,916 ---------------------------------------------------------------------------------------------- Totals............................................. 57,400,000 137,383,039 206,750,000 221,600,000 236,450,000 ============================================================================================== Set-asides: Indians (1%)......................................... 600,000 1,498,773 2,250,000 2,400,000 2,550,000 T, TA & Eval......................................... 2,000,000 6,000,000 6,000,000 6,000,000 6,000,000 Courts............................................... 0 5,000,000 10,000,000 10,000,000 10,000,000 ---------------------------------------------------------------------------------------------- Subtotal........................................... 2,600,000 12,498,773 18,250,000 18,400,000 18,550,000 ============================================================================================== Total for fiscal year.................................... 60,000,000 \1\ 150,000,000 225,000,000 240,000,000 255,000,000 -------------------------------------------------------------------------------------------------------------------------------------------------------- \1\ Includes $118,188 in lapsed funds. Source: U.S. Department of Health and Human Services. After these set-asides are made, remaining entitlement funds are allocated among States according to their relative shares of children receiving food stamps, subject to a 25- percent non-Federal match. States must submit a plan to HHS that provides a detailed account of how the money will be used. At least 90 percent of the funds must be used for two categories of services: family preservation services and community-based family support services. No more than 10 percent of funds can be used for administration. The Federal statute does not specify a percentage or minimum amount of funds that must be used for either family preservation or family support. However, in program guidance to States issued on January 18, 1994, HHS stated that allocations of less than 25 percent to either type of service will require a strong rationale. HHS subsequently restated this position in proposed regulations for the Family Preservation and Family Support Program, issued on October 4, 1994. Final regulations have not yet been published. Family preservation services are intended for children and families, including extended and adoptive families, that are at risk or in crisis. Services include: programs to help reunite children with their biological families, if appropriate, or to place them for adoption or another permanent arrangement; programs to prevent placement of children in foster care, including intensive family preservation services; programs to provide follow-up services to families after a child has been returned from foster care; respite care to provide temporary relief for parents and other caregivers (including foster parents); and services to improve parenting skills. Family support services are intended to reach families which are not yet in crisis and to prevent child abuse or neglect from occurring. Family support services are generally community-based activities designed to promote the well-being of children and families, to increase the strength and stability of families (including adoptive, foster and extended families), to increase parents' confidence and competence, to provide children with a stable and supportive family environment, and to enhance child development. Examples include parenting skills training, respite care to relieve parents and other caregivers, structured activities involving parents and children to strengthen their relationships, drop-in centers for families, information and referral services, and early developmental screening for children. In regulations proposed for the Family Preservation and Family Support Program on October 4, 1994, HHS set forth a series of child and family services ``principles'' that are intended to guide State implementation of the program. According to HHS, these principles emphasize the paramount importance of safety for all family members, including victims of child abuse and neglect and victims of domestic violence and their dependents. In the preamble to its proposed regulations, HHS states that family preservation ``does NOT mean that the family must stay together or `be preserved' under all circumstances.'' The principles also are intended to support a family-focused approach while allowing for individual needs, and a service delivery approach that stresses flexibility, accessibility, coordination, and respect for cultural and community strengths. The Secretary of HHS is required to evaluate Family Preservation and Family Support Programs and to submit interim evaluation findings to Congress by December 31, 1996; final evaluation findings are due by December 31, 1998. As stated above, a portion of the entitlement funds is reserved for a grant program to the highest State courts to assess and improve certain child welfare proceedings. The court set-aside equals $5 million in fiscal year 1995 and $10 million in each of fiscal years 1996-98. A 25 percent non-Federal match is required in each of the last 3 fiscal years. Courts will use grant funds to assess their procedures and effectiveness in determinations regarding foster care placement, termination of parental rights, and recognition of adoptions. Courts also can use these grant funds to implement changes found necessary as a result of the assessments. According to HHS, 48 States and the District of Columbia chose to implement this program, beginning in fiscal year 1995. Idaho, Pennsylvania, and Wyoming are not participating in the program. The Title IV-E Foster Care Program The Foster Care Program under title IV-E is a permanently authorized entitlement program. The program provides open-ended matching funds to States for the maintenance payments made for AFDC-eligible children in foster care family homes, private nonprofit child care facilities, or public child care institutions housing up to 25 people. The program is mandatory for States participating in the AFDC Program (all States participate). The Federal matching rate for a given State is that State's Medicaid matching rate, which averages about 57 percent nationally and can range from 50 to 80 percent. States may claim open-ended Federal matching at a rate of 50 percent for their child placement services and administrative costs. States also may claim open-ended Federal matching at a rate of 75 percent to train personnel employed by the State or by local agencies administering the program and to train foster and adoptive parents. During fiscal years 1994-96, States also have been able to receive Federal matching at the 75 percent rate for eligible costs related to automated child welfare information systems. States are required to provide foster care maintenance payments to AFDC-eligible children removed from the home of a relative if the child received or would have been eligible for AFDC prior to removal from the home and if the following apply: (1) the removal and foster care placement were based on a voluntary placement agreement signed by the child's parents or guardians or a judicial determination that remaining in the home would be contrary to the child's welfare; (2) reasonable efforts were made to eliminate the need for removal or to return the child to his home; and (3) care and placement of the child are the responsibility of specified public agencies. Children in the AFDC Foster Care Program are also eligible for Medicaid. Maintenance payments under the Title IV-E Foster Care Program are intended to cover the costs of food, shelter, clothing, daily supervision, school supplies, general incidentals, liability insurance for the child, and reasonable travel to the child's home for visits. Foster care expenditures and participation rates The average estimated monthly number of children in AFDC foster care more than doubled between 1983 and 1995, from 97,370 in fiscal year 1983 to 260,737 in fiscal year 1995 (see table 12-3). More detailed data on foster children and their characteristics are described later in this section. State claims for child placement services and administrative costs for the Title IV-E Foster Care Program have increased considerably since 1981. Current HHS regulations give the following examples of allowable child placement services and administrative costs for the Foster Care Program: referral to services, preparation for and participation in judicial determinations, placement of the child, development of the case plan, case reviews, case management and supervision, recruitment and licensing of foster homes and institutions, rate setting, and a proportionate share of agency overhead. As discussed later, many of these activities are required by the Federal Government as foster care ``protections''). Table 12-7 provides a State breakdown of foster care expenditures in fiscal year 1995 for maintenance payments, child placement and administration, data collection, and training expenditures. Note that California and New York account for 43 percent of the estimated fiscal year 1995 expenditures. A more detailed discussion of growth in child placement services and administrative costs is presented below. Foster care payment rates Table 12-8 shows each State's monthly foster care payment rates for children ages 2, 9, and 16, as determined in an annual survey conducted by the American Public Welfare Association (APWA). States are allowed to set them at any level; thus, the rates vary widely. For instance, in 1994 the minimum basic monthly rate for a 16-year-old foster child in the State of Alabama was $241 compared with $637 in the State of Connecticut. New York City had a monthly payment rate of $547. The nationwide average for this age group was $407 per month compared with $329 for 2-year-olds and $350 for 9-year- olds. According to APWA, 45 States supplement these base rates for children who have special needs or a need for particular items. The 1980 reform legislation stipulated that title IV-E foster care payments could be made for children in public institutions, whereas previously under title IV-A payments were limited to children in private nonprofit institutions or foster family homes. To qualify for Federal payments, these public institutions may not accommodate more than 25 children. Facilities operated primarily for the detention of delinquents, including forestry camps and training schools, are ineligible for Federal funds. It is generally agreed that the costs associated with institutional care are substantially higher than the cost of family foster care. For example, the Child Welfare League of America in 1994 estimated that the annual cost of supporting a child in family foster care was $4,800, compared to an estimated annual cost of $36,500 for a child in group care. TABLE 12-7.--FEDERAL FOSTER CARE EXPENDITURES UNDER TITLE IV-E, FISCAL YEAR 1995 [Estimate, dollars in millions] -------------------------------------------------------------------------------------------------------------------------------------------------------- Child State Automated Child placement Maintenance placement Child Welfare services and State payments services and Information Training Total administration as administration System (SACWIS) percent of total -------------------------------------------------------------------------------------------------------------------------------------------------------- Alabama........................................................ $2.06 $3.98 $0.32 $0.93 $7.29 54.60 Alaska......................................................... 2.16 4.85 0.51 0.01 7.53 64.41 Arizona........................................................ 15.07 13.68 4.68 0.89 34.32 39.86 Arkansas....................................................... 6.97 11.77 3.40 8.24 30.38 38.74 California..................................................... 297.48 240.10 0.00 32.30 569.88 42.13 Colorado....................................................... 6.65 15.64 0.01 2.12 24.42 64.05 Connecticut.................................................... 12.45 31.06 9.51 3.01 56.03 55.43 Delaware....................................................... 0.86 2.41 1.15 0.34 4.76 50.63 District of Columbia........................................... 5.83 10.70 0.00 0.14 16.67 64.19 Florida........................................................ 23.17 42.31 2.04 1.86 69.38 60.98 Georgia........................................................ 11.79 8.37 0.47 2.77 23.40 35.77 Hawaii......................................................... 2.66 5.85 0.00 0.25 8.76 66.78 Idaho.......................................................... 0.89 2.23 2.50 0.00 5.62 39.68 Illinois....................................................... 99.98 80.37 0.00 10.11 190.46 42.20 Indiana........................................................ 38.35 33.17 0.63 0.46 72.61 45.68 Iowa........................................................... 7.44 4.22 2.08 0.99 14.73 28.65 Kansas......................................................... 8.64 8.15 0.96 3.62 21.37 38.14 Kentucky....................................................... 17.59 20.01 1.65 5.12 44.37 45.10 Louisiana...................................................... 20.01 12.31 0.00 2.53 34.85 35.32 Maine.......................................................... 12.01 1.47 0.23 1.12 14.83 9.91 Maryland....................................................... 23.35 24.68 0.00 4.34 52.37 47.13 Massachusetts.................................................. 33.61 47.13 0.51 1.21 82.46 57.15 Michigan....................................................... 59.77 52.11 0.28 (0.42) 111.74 46.64 Minnesota...................................................... 21.72 7.67 0.15 4.34 33.88 22.64 Mississippi.................................................... 1.76 3.45 0.00 0.37 5.58 61.83 Missouri....................................................... 17.47 15.02 0.59 5.07 38.15 39.37 Montana........................................................ 4.07 1.15 3.76 0.02 9.00 12.78 Nebraska....................................................... 8.57 6.56 0.13 2.23 17.49 37.51 Nevada......................................................... 1.32 1.08 0.28 0.11 2.79 38.71 New Hampshire.................................................. 3.92 3.91 0.04 0.35 8.22 47.57 New Jersey..................................................... 15.32 13.40 0.00 0.04 28.76 46.59 New Mexico..................................................... 2.86 1.86 0.98 1.01 6.71 27.72 New York....................................................... 421.52 294.04 1.07 14.50 731.13 40.22 North Carolina................................................. 32.85 6.64 0.34 1.32 41.15 16.14 North Dakota................................................... 2.89 3.45 0.60 0.65 7.59 45.45 Ohio........................................................... 68.38 52.63 0.00 6.08 127.09 41.41 Oklahoma....................................................... 6.41 4.80 15.32 2.43 28.96 16.57 Oregon......................................................... 9.78 13.24 2.81 1.83 27.66 47.87 Pennsylvania................................................... 138.81 41.76 0.00 6.60 187.17 22.31 Rhode Island................................................... 4.80 3.31 0.45 0.08 8.64 38.31 South Carolina................................................. 6.08 3.69 0.40 1.91 12.08 30.55 South Dakota................................................... 0.89 1.46 0.04 0.04 2.43 60.08 Tennessee...................................................... 15.42 7.17 0.00 1.74 24.33 29.47 Texas.......................................................... 50.64 4.94 41.58 2.84 100.00 4.94 Utah........................................................... 3.96 4.49 1.09 0.95 10.49 42.80 Vermont........................................................ 5.74 1.77 0.02 0.67 8.20 21.59 Virginia....................................................... 6.21 11.05 0.00 2.38 19.64 56.26 Washington..................................................... 9.87 2.16 0.18 0.38 12.59 17.16 West Virginia.................................................. 3.86 1.39 0.06 0.56 5.87 23.68 Wisconsin...................................................... 19.56 24.13 0.00 1.27 44.96 53.67 Wyoming........................................................ 0.52 0.22 0.00 0.00 0.74 29.73 ---------------------------------------------------------------------------------------- Total.................................................... 1,593.99 1,213.01 100.82 141.71 3,049.53 39.78 -------------------------------------------------------------------------------------------------------------------------------------------------------- Totals may differ from sum of State amounts due to rounding. Source: U.S. Department of Health and Human Services. TABLE 12-8.--FOSTER CARE BASIC MONTHLY MAINTENANCE RATES FOR CHILDREN AGES 2, 9, AND 16, SELECTED YEARS 1987-94 -------------------------------------------------------------------------------------------------------------------------------------------------------- Age 2 Age 9 Age 16 State ----------------------------------------------------------------------------------------------------------- 1987 1991 1993 1994 1987 1991 1993 1994 1987 1991 1993 1994 -------------------------------------------------------------------------------------------------------------------------------------------------------- Alabama..................................... 168 181 205 205 188 202 229 229 198 213 241 241 Alaska...................................... 428 561 588 588 478 499 523 523 565 592 621 621 Arizona..................................... 223 247 295 297 223 247 284 286 282 305 362 365 Arkansas.................................... 175 195 300 300 190 210 325 325 220 240 375 375 California.................................. 294 345 345 345 340 400 400 400 412 484 484 484 Colorado.................................... 235 296 313 319 266 296 313 319 318 352 372 379 Connecticut................................. 268 386 515 567 302 424 524 586 350 478 593 637 Delaware.................................... 264 301 301 342 266 304 304 342 342 391 391 440 District of Columbia........................ 304 304 437 431 304 304 437 431 317 317 526 519 Florida..................................... 233 296 296 296 233 296 296 296 293 372 372 372 Georgia..................................... 300 300 300 300 300 300 300 300 300 300 300 300 Hawaii...................................... 194 529 529 529 233 529 529 529 301 529 529 529 Idaho....................................... 138 198 198 228 165 205 205 250 204 278 278 338 Illinois.................................... 233 268 311 322 259 299 346 358 282 325 377 390 Indiana..................................... 226 281 405 405 245 330 462 462 280 398 518 518 Iowa........................................ 159 198 308 328 201 243 322 342 285 300 382 405 Kansas...................................... 187 304 304 205 245 304 304 277 280 386 386 351 Kentucky.................................... 248 265 263 263 263 288 285 285 300 333 330 330 Louisiana................................... 199 283 298 298 232 316 331 331 265 349 364 364 Maine....................................... 244 296 296 296 250 304 304 304 291 353 353 353 Maryland.................................... 285 535 535 535 285 535 535 535 303 550 550 550 Massachusetts............................... 362 410 415 410 362 410 415 410 433 486 492 486 Michigan.................................... 315 332 354 383 315 332 354 383 395 416 442 454 Minnesota................................... 285 341 377 377 285 341 377 377 375 442 487 487 Mississippi................................. 130 145 175 175 150 165 205 205 160 175 250 250 Missouri.................................... 174 209 212 212 212 255 259 259 232 281 286 286 Montana..................................... 283 307 322 330 283 307 322 330 354 384 406 416 Nebraska.................................... 210 222 326 326 210 291 394 394 210 351 461 461 Nevada...................................... 275 281 281 281 275 281 281 281 330 337 337 337 New Hampshire............................... 200 200 324 314 251 251 354 342 354 354 418 404 New Jersey.................................. 203 244 264 272 215 259 280 288 253 305 320 340 New Mexico.................................. 236 258 258 308 247 270 270 341 259 281 281 367 New York.................................... 312 353 367 367 375 424 441 441 434 490 510 510 New York City............................... 342 386 401 401 403 455 473 473 465 526 547 547 North Carolina.............................. 215 265 265 315 215 265 265 365 215 265 265 415 North Dakota................................ 240 260 265 265 287 312 318 318 345 416 424 424 Ohio........................................ 240 289 381 413 270 328 381 413 300 366 381 413 Oklahoma.................................... 300 300 300 300 360 360 360 360 420 420 420 420 Oregon...................................... 200 285 305 315 234 295 317 327 316 363 391 404 Pennsylvania................................ 558 303 306 315 558 319 357 368 558 377 459 473 Rhode Island................................ 223 274 273 279 223 274 273 279 275 335 334 341 South Carolina.............................. 138 182 182 212 158 209 209 239 208 275 275 305 South Dakota................................ 188 237 251 259 230 291 308 317 276 349 370 382 Tennessee................................... 139 255 336 336 190 226 262 262 224 267 385 385 Texas....................................... 243 420 476 476 243 420 476 476 274 420 476 476 Utah........................................ 198 300 310 300 198 300 310 300 225 300 310 300 Vermont..................................... 210 371 321 416 249 371 321 416 268 447 386 504 Virginia.................................... 193 246 251 256 244 288 294 300 309 365 372 379 Washington.................................. 184 270 278 292 227 332 342 359 268 392 405 425 West Virginia............................... 161 161 161 161 202 202 202 202 242 242 242 242 Wisconsin................................... 163 231 240 276 224 257 267 301 284 324 337 361 Wyoming..................................... 300 400 400 400 300 400 400 400 330 400 400 400 ----------------------------------------------------------------------------------------------------------- Average monthly rates................... 239 294 321 329 263 314 339 350 307 365 394 407 -------------------------------------------------------------------------------------------------------------------------------------------------------- Note.--Figures are rounded to the nearest dollar. Most States and/or counties supplement these basic rates with additional payments. Source: American Public Welfare Association. Exclusion of foster children from AFDC assistance units The Deficit Reduction Act of 1984 (Public Law 98-369) required that certain blood-related, adoptive parents or siblings be included in the family unit if the family applies for income assistance under the AFDC Program. Because there was no statutory exclusion for foster care recipients, AFDC operating policy required that their income be included with the family's when the family's eligibility was determined. However, Public Law 99-514, enacted in 1986, stated that a foster child who is receiving IV-E maintenance payments must not be considered a family member during the time the family receives AFDC, and that the child's income in the form of maintenance payments, and other income and resources, must be excluded from the family's as well. The Omnibus Budget Reconciliation Act of 1990 (Public Law 101-508) repealed the 1986 provision and added a new section 409 to title IV-A stipulating that foster children receiving maintenance payments under title IV-E or under State or local programs are not considered family members for purposes of AFDC. Similarly, the law specifies that children receiving adoption assistance payments under either title IV-E or State or local law are not considered family members for AFDC purposes, unless the family would lose AFDC benefits as a result. The Title IV-E Adoption Assistance Program The Title IV-E Adoption Assistance Program is an open-ended entitlement program required of States that participate in AFDC (all States participate). Like the IV-E Foster Care Program, the IV-E Adoption Program funds three distinct types of activities: maintenance payments for qualified children who are adopted, administrative payments for expenses associated with placing children in adoption, and training of professional staff and parents involved in adoptions. Under the adoption program, which is permanently authorized, States develop adoption assistance agreements with parents who adopt eligible children with special needs. Federal matching funds are provided to States that, under these agreements, provide adoption assistance payments to parents who adopt AFDC- or SSI-eligible children with special needs. In addition, the program authorizes Federal matching funds for States that reimburse the nonrecurring adoption expenses of adoptive parents of special needs children (regardless of AFDC or SSI eligibility). Definition of special needs A special needs child is defined in the statute as a child with respect to whom the State determines there is a specific condition or situation, such as age, membership in a minority or sibling group, or a mental, emotional, or physical handicap, which prevents placement without special assistance. Before a child can be considered to be a child with special needs, the State must determine that the child cannot or should not be returned to the biological family, and that reasonable efforts have been made to place the child without providing adoption assistance. States have discretion in defining special needs eligibility criteria and individually determining whether a child is eligible. For example, some States add religion or not being able to place the child without subsidy to the definition of special needs. Adoption assistance agreements and payments An adoption assistance agreement is a written agreement between the adoptive parents, the State IV-E agency, and other relevant agencies (such as a private adoption agency) specifying the nature and amount of assistance to be given. Under the adoption assistance agreement, States may make monthly adoption assistance payments for AFDC- and SSI-eligible children with special needs who are adopted. The amount of adoption assistance payments to be made is based on the circumstances of the adopting parents and the needs of the child. No means test can be used to determine eligibility of parents for the program; however, States do use means tests to determine the amount of the payment. Payments may be adjusted periodically if circumstances change, with the concurrence of the adopting parents. However, the payments may not exceed the amount the family might have received on behalf of the child under foster care. Adoption assistance payments may continue until the child is age 18, or, at State option, age 21 if the child is mentally or physically handicapped. Payments are discontinued if the State determines that the parents are no longer legally responsible for the support of the child. Federally subsidized payments may start as soon as an agreement is signed and the child has been placed in an adoptive home. Parents who have been receiving adoption assistance payments must keep the State or local agency informed of circumstances that would make them ineligible for payments, or eligible for payments in a different amount. The Federal matching rate for the adoption assistance payments is based on each State's Medicaid matching rate. States may also claim open-ended Federal matching at the rate of 50 percent for the costs of administering the program and for training both staff and adoptive parents at the rate of 75 percent. Not all families of adopted IV-E eligible children with special needs actually receive adoption assistance payments. The adoptive parents' circumstances may be such that an adoption subsidy is not needed or wanted. Adopted AFDC- or SSI- eligible children with special needs are also eligible for Medicaid if an adoption assistance agreement is in effect, regardless of whether adoption assistance payments are being made. States also have the option under the Medicaid Program to provide Medicaid coverage for other special needs children (those not eligible for AFDC or SSI) who are adopted if they have been identified as a special category of medically needy children under a State's Medicaid Program. Pursuant to the 1985 budget reconciliation legislation, a child for whom an adoption assistance agreement is in effect is eligible for Medicaid from the State in which the child resides regardless of whether the State is the one with which the adoptive parents have an adoption assistance agreement. The structure of adoption subsidy programs varies across States. Some States offer basic maintenance payments and also allow additional payments for certain activities (such as family counseling) or for certain groups of children (such as children with severe handicaps). Other States offer one level of payment to everyone with no special allowances. Some States allow parents to request changes in payment levels on a regular basis if circumstances change for a child; others allow very little change once the adoption agreement is signed. Some States start payments as soon as placement is made; others not until the adoption is finalized. Not all children who receive adoption subsidies from States are eligible for Federal IV-E funds. The American Public Welfare Association (APWA) estimates that at the end of 1990 (the latest year for which data are available), approximately half of the estimated 99,000 children nationwide whose families received adoption subsidies were IV-E eligible. The non-IV-E children's adoption subsidies are paid solely by the State in which their adoption agreement was signed. States differ in whether comparable IV-E children and non-IV-E children receive similar adoption subsidy amounts. Nonrecurring adoption costs The Adoption Assistance Program also authorizes Federal matching funds for States to pay the one-time adoption expenses of parents of special needs children (regardless of AFDC or SSI eligibility). In order to be eligible, the child must be a child with special needs, as defined in section 473(c) of the Social Security Act and described above. Through the program, parents may receive reimbursement of up to $2,000 per child for these nonrecurring adoption expenses, and States may claim 50 percent Federal matching for these reimbursements. Qualified adoption expenses are defined as reasonable and necessary adoption fees, court costs, attorney fees, and other expenses that are directly related to the adoption of a child with special needs. States may vary in the maximum amount they allow parents to receive under this provision (see table 12-9 for State-by-State data on maximum reimbursement rates). All 49 States have implemented the program; the District of Columbia has not. However, the average reimbursements have not equaled the $2,000 Federal cap, with the average payment being $966 in 1996. According to the Association of Administrators of the Interstate Compact on Adoption and Medical Assistance (AAICAMA), for which the American Public Welfare Association serves as the secretariat, in a number of States, the larger amounts of nonrecurring adoption costs are being paid for costs incurred in the adoption of special needs children from foreign countries and private agencies. Parent adopting children from the public child welfare agencies are not claiming as many expenses because many costs incurred in the adoption of these children are already covered under the States' adoption programs. TABLE 12-9.--STATE REIMBURSEMENT OF NONRECURRING ADOPTION COSTS, 1991, 1992, AND 1996 -------------------------------------------------------------------------------------------------------------------------------------------------------- Has your Estimated State Estimated average implemented Maximum average payment Estimated average State the payment payment as of payment as of April Major reimbursement cost(s) reimbursement of May April 1996 program? 1991 1992 -------------------------------------------------------------------------------------------------------------------------------------------------------- Alabama................................ Yes $1,000 $350 $412 $1,000 Legal fees, travel, preplacement visits. Alaska................................. Yes 2,000 1,200 829 \1\ NA Legal fees, travel, home studies. Arizona................................ Yes 2,000 2,000 1,596 2,000 Legal fees, agency fees, travel, home studies. Arkansas............................... Yes 1,500 100 500 200 Court filing, fingerprint checks. California............................. Yes 500 400 400 500 Agency fees. Colorado............................... Yes 800 250 250 800 Legal fees. Connecticut............................ Yes 750 90 90 424 Legal fee. Delaware............................... Yes 2,000 300 300 NA Agency fees. District of Columbia................... No Florida................................ Yes 1,000 400 400 1,000 Attorney fees. Georgia................................ Yes 700 400 400 400 Legal fees. Hawaii................................. Yes 2,000 NA NA NA Idaho.................................. Yes 2,000 NA 350 \2\ 550 Agency fees, attorney fees, travel. 2,000 average = 1,275 Illinois............................... Yes 1,500 NA NA NA Legal fees, home studies. Indiana................................ Yes 1,500 635 NA 700 Legal fees, agency fees. Iowa................................... Yes 1,000 700 700 300 Legal fees. Kansas................................. Yes 2,000 NA NA 700 Legal fees, home studies, travel. Kentucky............................... Yes 1,000 378 378 476 Legal fees, agency fees. Louisiana.............................. Yes 1,000 400 600 600 Legal fees. Maine.................................. Yes \3\ 2,000 NA ......... NA Legal fees, travel. Maryland............................... Yes 2,000 NA 2,000 2,000 Legal fees, travel, home studies by private agencies. \4\ Massachusetts.......................... Yes 400 400 ......... 400 Legal fees, home studies. Michigan............................... Yes 2,000 ......... ......... 170 Court fees, birth certificate cost. Minnesota.............................. Yes 2,000 2,000 2,000 1,750 Legal fees, agency fees. Mississippi............................ Yes 1,000 500 500 550 Legal fees. Missouri............................... Yes 2,000 NA \5\ 45 625--legal Legal fees, agency fees. 910--other average = 1,535 Montana................................ Yes 2,000 1,000 1,000 200 Legal fees, home studies, private agency fees. Nebraska............................... Yes 1,500 NA NA 1,500 Legal fees, private agency fees, travel. Nevada................................. Yes 250 250 250 NA Legal fees, travel, home studies. New Hampshire.......................... Yes 2,000 2,000 2,000 1,556 Legal costs, agency fees, travel. New Jersey............................. Yes 2,000 NA 850 NA Home studies, legal fees. New Mexico............................. Yes 2,000 500 500 NA Legal fees, travel. New York............................... Yes 2,000 500 500 600 Legal fees. North Carolina......................... Yes 2,000 NA 176 NA Legal fees. North Dakota........................... Yes 2,000 350 540 NA Legal fees. Ohio................................... Yes 2,000 761 672 2,000 Legal fees, travel. Oklahoma............................... Yes 2,000 2,000 350 \6\ domestic--275 Legal fees, agency fees. tribal, foreign-- 2,000 private average = 1,138 Oregon................................. Yes 2,000 300 450 NA Legal fees. Pennsylvania........................... Yes 2,000 NA 700 811 Legal fees, agency fees. Rhode Island........................... Yes 1,000 NA 902 1,000 Legal fees, home studies, preadoption supervision. South Carolina......................... Yes 1,500 750 750 1,500 Legal fees. Texas.................................. Yes 1,500 NA NA 875 Legal fees, agency fees. Utah................................... Yes 2,000 327 327 650 Legal fees, home studies, travel. Vermont................................ Yes 2,000 1,500 1,500 \7\ 2,000 Legal fees, home studies, agency placement fees. Virginia............................... Yes 2,000 280 396 884 Legal fees. Washington............................. Yes 1,500 655 780 636 Legal fees. West Virginia.......................... Yes 2,000 ......... ......... 1,400 Legal fees, private agency home studies. Wisconsin.............................. Yes 2,000 655 780 468 Legal fees home studies. Wyoming................................ Yes 2,000 350 350 NA Legal fees. ------------------------------------------------------- Average.......................... XXX 1,651 682 664 \8\ 966 -------------------------------------------------------------------------------------------------------------------------------------------------------- \1\ Alaska: Indicated that the maximum amount was being paid primarily for the adoption of special needs children from foreign countries. \2\ Idaho: For domestic adoptions, the average payment is $500; For foreign (China & Haiti) adoptions, the average payment is $2,000. This differential is due to the fact that most expenses are paid for by the public agency when a child is adopted from the public agency. \3\ Maine: The program was not implemented until 1996. \4\ Maryland: Bills submitted are often over $5,000, many of which are for children adopted from foreign countries. \5\ Missouri: The low cost of this number is due to the fact that at the time the state was able to secure a lot of pro bono legal representation. \6\ Oklahoma: The average payment for children adopted from the Department of Human Services is $275; For special needs children adopted from foreign countries, private agencies, and tribal adoptions, the average payment is $2,000. \7\ Vermont: Most payments made for nonrecurring adoption costs are for children adopted from foreign countries; nonrecurring adoption costs are paid for the adoption of special needs children being adopted from foreign countries. There are few, if any, costs for adopting children from the public agency. \8\ This number accounts for the total average payment of nonrecurring adoption costs in 36 States. NA--Not available. Source: Special survey conducted in spring 1996 by the American Public Welfare Association. Adoption assistance expenditures The number of children receiving adoption assistance payments and the Federal expenditures for these payments have increased significantly since the program began. In fiscal year 1981, only six States participated in the program, with payments being made for an average of 165 children per month. In fiscal year 1995, 50 States plus the District of Columbia participated, and 78,044 children (see table 12-10) were served. Federal expenditures for adoption assistance payments have increased from less than $400,000 in fiscal year 1981 to an estimated $411 million in fiscal year 1995, and are expected to reach $482 million in fiscal year 1996. HHS data indicate that expenditures for child placement services and administration for the Adoption Assistance Program have also increased significantly in recent years. In fiscal year 1981, claims totaled $100,000; in fiscal year 1995 they totalled an estimated $105 million and are expected to be $123 million in fiscal year 1996. The Title IV-E Independent Living Program In 1986, title IV-E was amended by Public Law 99-272 (Consolidated Omnibus Budget Reconciliation Act of 1985) to include section 477, which established the Independent Living Program to assist youth who would eventually be emancipated from the foster care system. Several surveys conducted during the mid-1980s showed that a significant number of homeless shelter users had been recently discharged from foster care, thereby prompting Congress to establish a program to help youngsters in foster care establish their independence. An annual entitlement amount of $45 million was established for 1987 and 1988 to provide States with the resources to create and implement independent living services. These services are designed to assist AFDC-eligible children age 16 and over make a successful transition from foster care to independent adult living when they become ineligible for foster care maintenance payments at age 18. In 1988, the program was expanded under Public Law 100-647, which permitted States to provide independent living services to all youth in foster care aged 16 to 18 (not just title IV-E-eligible youth); States could also provide follow-up services to youth up to 6 months after their emancipation from substitute care. Under Public Law 101-508, States have the option of serving individuals up to age 21 in the Independent Living Program. Funds are allocated on the basis of each State's share of children receiving IV-E foster care in 1984. TABLE 12-10.--ADOPTION ASSISTANCE STATE CLAIMS, FISCAL YEARS 1990-95, AND AVERAGE NUMBER OF CHILDREN RECEIVING ADOPTION ASSISTANCE, FISCAL YEAR 1995 [In thousands of dollars] ---------------------------------------------------------------------------------------------------------------- Fiscal year ----------------------------------------------------------------------------------- 1995 State Average 1990 1991 1992 1993 1994 1995 monthly Claims Claims Claims Claims Claims Claims number of children ---------------------------------------------------------------------------------------------------------------- Alabama..................... $384 $1,054 $1,070 $1,195 $1,830 $1,866 238 Alaska...................... 170 360 590 839 1,070 1,286 376 Arizona..................... 1,182 1,338 1,660 3,117 3,960 5,522 1,095 Arkansas.................... 507 582 670 1,241 1,960 1,541 317 California.................. 19,742 27,747 30,230 36,623 43,590 48,235 14,146 Colorado.................... 774 1,177 1,120 1,961 3,230 3,315 1,198 Connecticut................. 1,137 1,529 2,640 3,652 6,310 7,028 1,141 Delaware.................... 251 330 380 413 430 536 181 District of Columbia........ 772 (191) 820 1,269 1,970 1,846 319 Florida..................... 5,354 5,357 7,980 8,257 10,580 16,824 3,776 Georgia..................... 1,076 1,341 2,070 3,146 3,320 4,365 1,189 Hawaii...................... 81 47 160 243 480 606 159 Idaho....................... 294 330 360 570 580 753 233 Illinois.................... 4,643 4,376 6,300 7,558 13,060 16,802 5,568 Indiana..................... 1,636 2,540 4,020 5,711 6,710 7,338 1,958 Iowa........................ 996 2,878 2,750 2,923 3,870 4,976 1,204 Kansas...................... 539 725 880 1,576 2,240 2,740 1,341 Kentucky.................... 2,206 2,692 2,930 3,052 3,320 3,539 799 Louisiana................... 1,481 2,746 5,830 7,656 9,320 11,043 1,431 Maine....................... 984 1,229 2,300 2,646 2,960 2,794 521 Maryland.................... 1,005 1,219 1,680 2,385 2,880 3,633 1,064 Massachusetts............... 3,618 5,010 6,230 7,134 8,380 9,604 2,875 Michigan.................... 11,881 14,202 17,540 21,868 26,840 31,917 9,138 Minnesota................... 1,101 1,462 1,710 4,003 4,620 5,224 1,121 Mississippi................. 351 398 410 410 390 667 247 Missouri.................... 1,695 2,470 5,450 4,674 5,190 6,743 2,305 Montana..................... 192 603 530 631 760 905 241 Nebraska.................... 665 767 1,000 1,179 1,560 1,771 607 Nevada...................... 162 204 250 333 460 669 177 New Hampshire............... 295 438 620 600 740 842 324 New Jersey.................. 2,844 4,157 5,000 6,009 6,700 8,869 2,271 New Mexico.................. 1,178 1,609 1,810 1,798 1,890 2,438 733 New York.................... 33,336 39,200 44,400 57,520 72,590 89,816 20,518 North Carolina.............. 739 836 1,090 1,748 2,550 4,228 1,475 North Dakota................ 172 250 350 466 500 461 145 Ohio........................ 9,608 14,167 18,860 22,964 30,300 35,007 8,116 Oklahoma.................... 1,069 1,161 1,630 1,960 2,240 2,950 579 Oregon...................... 969 1,547 2,370 2,804 3,300 4,020 2,167 Pennsylvania................ 2,960 4,263 5,440 6,820 8,090 10,273 2,597 Rhode Island................ 3,069 3,353 3,610 4,399 4,610 4,194 630 South Carolina.............. 1,568 1,766 2,070 2,235 2,910 3,915 621 South Dakota................ 50 492 540 555 630 649 267 Tennessee................... 1,345 2,010 2,100 3,573 3,240 3,620 974 Texas....................... 4,546 5,233 6,750 9,142 14.520 17,160 3,943 Utah........................ 376 447 660 748 1,240 1,158 375 Vermont..................... 1,147 1,248 1,740 2,009 1,860 1,947 391 Virginia.................... 1,014 1,655 1,970 2,291 2,590 2,997 1,296 Washington.................. 620 2,055 4,000 1,987 3,940 3,013 2,405 West Virginia............... 197 230 260 285 440 492 160 Wisconsin................... 3,714 4,565 5,290 6,171 7,730 9,056 1,736 Wyoming..................... 45 79 110 60 60 23 6 ----------------------------------------------------------------------------------- Total................. 135,740 175,283 220,230 272,409 344,540 411,216 106,880 ---------------------------------------------------------------------------------------------------------------- Totals may differ from sum of State amounts because of rounding. Source: U.S. Department of Health and Human Services. Public Law 101-239 increased the amount of Federal entitlement funds available to the States for the Independent Living Program to $50 million for fiscal year 1990, $60 million for fiscal year 1991, and $70 million for fiscal year 1992. Beginning in fiscal year 1991, States are required to provide 50 percent matching for any Federal funding claimed that exceeds the original $45 million funding level. In 1993, Congress permanently extended the authority for independent living under Public Law 103-66. Table 12-11 shows State allotments under the Independent Living Program in fiscal year 1995. Section 477 of title IV-E instructed HHS to carry out a study of the program's effectiveness. Under contract with HHS, Westat, Inc. completed the first phase of the study in 1989 (Cook, 1990) and the second phase in 1992 (Cook, 1992). The first phase is a purely descriptive assessment of the needs of youth emancipated from foster care between January 1, 1987 and July 31, 1988, States' development of Independent Living Programs to serve these youth, and the proportion of youth served. The first report found that independent living services offered by the States generally fell into the following categories: basic skills training (including health promotion, housekeeping, money management, decisionmaking, and food and nutrition management); education initiatives (including private tutoring, and GED and college preparation); and employment initiatives (including job training and placement, and personal presentation and social skills). In addition, 14 States held teen conferences designed to bring these foster care youth together to provide them with supportive contacts, teach them independent living skills, focus on self-esteem building, and help prepare them for their impending emancipation from foster care. The report concluded that emancipated youth were a troubled population. In the study population, two-thirds of 18-year-olds did not complete high school or a GED and 61 percent had no job experience. In addition, 38 percent had been diagnosed as emotionally disturbed, 17 percent had a drug abuse problem, 9 percent had a health problem, and 17 percent of the females were pregnant. The group also lacked placement stability. During the time they were in foster care, 58 percent experienced at least three living arrangements and approximately 30 percent had been in substitute care for an average of 9 years. Of the total 34,600 youth emancipated from foster care during the study period, 31 percent received services through their State's formalized Independent Living Program, 29 percent received nonformalized (but related) services, and 40 percent received no independent living services at all. The second phase of the Westat report, released in 1992, followed up on youths who had been emancipated from foster care during the period from January 1987 to July 1988. Interviews conducted with these youths about their experiences after leaving foster care revealed several notable results. First, many of the skills encouraged by the Independent Living Program were positively related to good outcomes once the adolescents left foster care. These skills included money management, consumer education, and job training. Westat also found that 2\1/2\ to 4 years after leaving foster care, many of the youths were encountering problems adjusting to life as an adult. Only about half had completed high school, a little less than half had jobs and only about 40 percent had had a job for at least 1 year, 60 percent of the females had given birth, 25 percent of the youth had been homeless for at least one night, and fewer than 1 in 5 were completely self-supporting. TABLE 12-11.--TITLE IV-E INDEPENDENT LIVING FEDERAL AWARDS, FISCAL YEAR 1995 [In thousands of dollars] ------------------------------------------------------------------------ Total State awards ------------------------------------------------------------------------ Alabama.................................................... $1,044 Alaska..................................................... 13 Arizona.................................................... 350 Arkansas................................................... 272 California................................................. 12,554 Colorado................................................... 830 Connecticut................................................ 759 Delaware................................................... 204 District of Columbia....................................... 927 Florida.................................................... 993 Georgia.................................................... 1,105 Hawaii..................................................... 18 Idaho...................................................... 108 Illinois................................................... 2,833 Indiana.................................................... 1,020 Iowa....................................................... 452 Kansas..................................................... 722 Kentucky................................................... 792 Louisiana.................................................. 1,358 Maine...................................................... 569 Maryland................................................... 1,245 Massachusetts.............................................. 639 Michigan................................................... 4,195 Minnesota.................................................. 1,148 Mississippi................................................ 517 Missouri................................................... 1,302 Montana.................................................... 244 Nebraska................................................... 438 Nevada..................................................... 155 New Hampshire.............................................. 322 New Jersey................................................. 2,311 New Mexico................................................. 208 New York................................................... 11,651 North Carolina............................................. 1,051 North Dakota............................................... 193 Ohio....................................................... 2,877 Oklahoma................................................... 624 Oregon..................................................... 931 Pennsylvania............................................... 4,664 Rhode Island............................................... 317 South Carolina............................................. 583 South Dakota............................................... 193 Tennessee.................................................. 782 Texas...................................................... 1,852 Utah....................................................... 203 Vermont.................................................... 297 Virginia................................................... 1,362 Washington................................................. 830 West Virginia.............................................. 335 Wisconsin.................................................. 1,563 Wyoming.................................................... 45