How the $500 Million Family First Transition Fund Will Work

The Family First Act was signed into law in February 2018, and mostly took effect in October 2019

The U.S. Children’s Bureau is overseeing the $500 million transition fund approved this year to help states prepare and implement the Family First Prevention Services Act, a major overhaul of child welfare funding. It put out some guidelines for how the money – which comes from the Department of the Treasury – will be allocated and how it can be spent.

The Family First Act, signed into law in 2018, expands the Title IV-E entitlement – which currently only funds foster care and adoption services – to include efforts at preventing the use of foster care in some child welfare cases. This will be known as “IV-E Prevention,” and the list of fundable services is limited to substance abuse treatment, mental health interventions and in-home parenting programs.

The transition fund was one of three Family First Act-related boosts to states included in the 2020 congressional spending deal, all meant to speed up compliance. Washington, D.C., and a handful of states have already implemented the law, but more than three dozen elected to take up to a two-year delay to get ready.

Following is a quick rundown of what you need to know about the $500 million pot that is about to go out to state child welfare agencies.

No Application: Originally, states were told they’d need to apply for the funds, but in an effort to limit paperwork demands during the pandemic, that has been dropped. “Acceptance of the grant by the agency will indicate its agreement to provide required programmatic and financial reports,” the bureau said in a memo to state agencies, and any funds declined by a state would be spread out among the rest.

How Much: $485 million is heading out to state agencies, the District of Columbia and the territories. Among the states, the allocations ranged from $816,000 to Wyoming up to $50.3 million for Texas.

Another collective $15 million went to more than 150 tribal grantees. All the recipients can spend down this one-time fund through the end of fiscal 2025.

How It Can Be Used: The guidance from the Children’s Bureau breaks out three avenues of spending under the fund.

The most general: “Activities directly associated with implementation” of the law. This could include, for example, investing in community providers to start operating models of service approved by the Family First clearinghouse. Money may also be used for the development and accreditation of residential treatment programs, which will be enabled to draw federal funds longer than other group settings. States may also contract for more therapeutic foster homes aimed at serving youth with acute needs without resorting to congregate care.

Second, states can use the funds to augment existing spending on anything allowed already under Title IV-B, which covers child welfare services and family safety and stability programs. This includes everything from family preservation and maltreatment prevention to caseworker training and post-adoption services.

Third, and perhaps most surprising: states operating a Title IV-E waiver as of last October can use this money to pay for services that were carried out under the waiver, “to reduce any adverse fiscal impacts as jurisdictions transition funding sources for the projects.”

That jumps out only because one of the other Family First Act sweeteners in the spending deal was a provision exclusively for waiver states that allowed them to recover losses from the end of the waivers. The bill would guarantee 90 percent of waiver funds for fiscal 2020, and 75 percent of the funds for fiscal 2021.

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John Kelly, Editor in Chief, The Chronicle of Social Change
About John Kelly, Editor in Chief, The Chronicle of Social Change 1211 Articles
John Kelly is editor-in-chief of The Chronicle of Social Change. Reach him at jkelly@chronicleofsocialchange.org.