Sen. Wyden Circulates Bill to Overhaul Federal Child Welfare Financing

The lead Democrat on the Senate Finance Committee is circulating a draft bill that would for the first time permit states to use federal foster care entitlement dollars on preventing child abuse and keeping families together.

The bill, drafted by Finance Committee Ranking Member Ron Wyden (D-Ore.), would allow for spending on “time-limited family services” through the IV-E entitlement.

Right now, IV-E is structured to provide matching funds to states only for expenditures on foster care and other out-of-home placements. Critics believe that this incentivizes the removal of children from home and fails to provide federal support for services that keep families together.

Wyden’s restructure would allow IV-E dollars to flow in the case of “a child who is identified as being at imminent risk of entering or re-entering foster care, as specified in the child’s case plan or as designated in a judicial proceeding.”

States could only spend IV-E funds for services to that group of children for a 12-month period that starts the day they are formally identified in a case plan or in a court proceeding.

The bill lists several services that would be allowable under IV-E, including parent-to-parent mentoring, counseling, housing support, assistance with utility payments and substance abuse programs.

States would be required to sign a Maintenance of Effort agreement guaranteeing that the IV-E funds would “supplement, not supplant” existing levels of spending on family services.

With time-limited services moved into the scope of IV-E, Wyden would remove time restrictions on funding through the smaller IV-B account, the traditional vehicle for federal spending on child welfare services other than foster care. For example, current IV-B rules prevent states from spending the money on reunification services after a 15-month window.

Wyden would also make the Promoting Safe and Stable Families Program (PSSF), a part of IV-B, a mandatory program and set 2016 funding at $1 billion, a $600 million markup from its most recent appropriations from Congress.

Two smaller pieces in the bill: $4 million to research “promising programs” and “culturally-specific adaptations,” and a year extension of the Family Connections grants at $15 million.

Wyden’s bill is the latest in a series of new child welfare financing concepts to emerge in recent years.

In September of 2014, a group of child welfare member organizations led by the Alliance for Strong Families and Communities began to push a plan that would have made the allowable uses of IV-E and IV-B interchangeable.

In 2013, the Annie E. Casey Foundation announced a proposal to rein in the use of IV-E for foster care placements. Under the Casey plan, IV-E funding to support placements into congregate care would be limited to one year, and states would no longer be able to draw on the funds to place youth under 13 into group care.

That plan has found some support from Finance Committee Chairman Orrin Hatch (R-Utah), and from Rep. James Langevin (D-R.I.)

Wyden did not work with Hatch on this most recent bill, said Wyden spokesperson Taylor Harvey.

John Kelly is an editor for The Chronicle of Social Change.

Print Friendly, PDF & Email