[House Hearing, 106 Congress]
[From the U.S. Government Publishing Office]
H.R. 5292, ``THE FLEXIBLE FUNDING FOR CHILD PROTECTION ACT OF 2000''
=======================================================================
HEARING
before the
SUBCOMMITTEE ON HUMAN RESOURCES
of the
COMMITTEE ON WAYS AND MEANS
HOUSE OF REPRESENTATIVES
ONE HUNDRED SIXTH CONGRESS
SECOND SESSION
__________
JANUARY 3, 2000
__________
Serial 106-73
__________
Printed for the use of the Committee on Ways and Means
__________
U.S. GOVERNMENT PRINTING OFFICE
68-104 WASHINGTON : 2000
_______________________________________________________________________
For sale by the U.S. Government Printing Office
Superintendent of Documents, Congressional Sales Office, Washington, DC
20402
COMMITTEE ON WAYS AND MEANS
BILL ARCHER, Texas, Chairman
PHILIP M. CRANE, Illinois CHARLES B. RANGEL, New York
BILL THOMAS, California FORTNEY PETE STARK, California
E. CLAY SHAW, Jr., Florida ROBERT T. MATSUI, California
NANCY L. JOHNSON, Connecticut WILLIAM J. COYNE, Pennsylvania
AMO HOUGHTON, New York SANDER M. LEVIN, Michigan
WALLY HERGER, California BENJAMIN L. CARDIN, Maryland
JIM McCRERY, Louisiana JIM McDERMOTT, Washington
DAVE CAMP, Michigan GERALD D. KLECZKA, Wisconsin
JIM RAMSTAD, Minnesota JOHN LEWIS, Georgia
JIM NUSSLE, Iowa RICHARD E. NEAL, Massachusetts
SAM JOHNSON, Texas MICHAEL R. McNULTY, New York
JENNIFER DUNN, Washington WILLIAM J. JEFFERSON, Louisiana
MAC COLLINS, Georgia JOHN S. TANNER, Tennessee
ROB PORTMAN, Ohio XAVIER BECERRA, California
PHILIP S. ENGLISH, Pennsylvania KAREN L. THURMAN, Florida
WES WATKINS, Oklahoma LLOYD DOGGETT, Texas
J.D. HAYWORTH, Arizona
JERRY WELLER, Illinois
KENNY HULSHOF, Missouri
SCOTT McINNIS, Colorado
RON LEWIS, Kentucky
MARK FOLEY, Florida
A.L. Singleton, Chief of Staff
Janice Mays, Minority Chief Counsel
______
Subcommittee on Human Resources
NANCY L. JOHNSON, Connecticut, Chairman
PHILIP S. ENGLISH, Pennsylvania BENJAMIN L. CARDIN, Maryland
WES WATKINS, Oklahoma FORTNEY PETE STARK, California
RON LEWIS, Kentucky ROBERT T. MATSUI, California
MARK FOLEY, Florida WILLIAM J. COYNE, Pennsylvania
SCOTT McINNIS, Colorado WILLIAM J. JEFFERSON, Louisiana
JIM McCRERY, Louisiana
DAVE CAMP, Michigan
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C O N T E N T S
__________
Page
Advisory of September 26, 2000, announcing the hearing........... 2
WITNESSES
American Public Human Services Association, William Waldman...... 8
Catholic Charities USA, Sharon Daly.............................. 25
Center on Budget and Policy Priorities, Wendell Primus........... 13
Chapin Hall Center for Children, Fred Wulczyn.................... 23
Florida Department of Children and Families, Hon. Kathleen A.
Kearney........................................................ 35
Geen, Robert, Urban Institute.................................... 31
SUBMISSION FOR THE RECORD
National Children's Alliance, Nancy Chandler, statement.......... 50
H.R. 5292, ``THE FLEXIBLE FUNDING FOR CHILD PROTECTION ACT OF 2000''
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TUESDAY, OCTOBER 3, 2000
House of Representatives,
Committee on Ways and Means,
Subcommittee on Human Resources,
Washington, DC.
The Subcommittee met, pursuant to notice, at 10:05 a.m., in
room B-318, Rayburn House Office Building, Hon. Nancy L.
Johnson (Chairman of the Subcommittee) presiding.
[The advisory announcing the hearing follows:]
ADVISORY FROM THE COMMITTEE ON WAYS AND MEANS
SUBCOMMITTEE ON HUMAN RESOURCES
CONTACT: (202) 225-1025
FOR IMMEDIATE RELEASE
September 26, 2000
No. HR-25
Johnson Announces Hearing on H.R. 5292, the
``Flexible Funding for Child Protection Act of 2000''
Congresswoman Nancy L. Johnson (R-CT), Chairman, Subcommittee on
Human Resources of the Committee on Ways and Means, today announced
that the Subcommittee will hold a hearing on H.R. 5292, the ``Flexible
Funding for Child Protection Act of 2000.'' The hearing is being called
in lieu of the Subcommittee markup originally scheduled for Wednesday,
September 27, 2000. The hearing will take place on Tuesday, October 3,
2000, in room B-318 Rayburn House Office Building, beginning at 10:00
a.m.
In view of the limited time available to hear witnesses, oral
testimony at this hearing will be from invited witnesses only.
Witnesses will include State administrators of child protection
programs, child advocates, and researchers. However, any individual or
organization not scheduled for an oral appearance may submit a written
statement for consideration by the Committee and for inclusion in the
printed record of the hearing.
BACKGROUND:
In 1980, Congress passed legislation that created a program of
Federal support for child protection programs conducted by State and
local governments. The legislation created two major programs: a capped
grant program under Title IV-B of the Social Security Act that gave
States flexibility in providing treatment for families and children
involved in abuse or neglect as well as services for foster and
adoptive families; and a series of open-ended entitlement programs
under Title IV-E that help States operate their foster care and
adoption programs for children who have been removed from their
families. The funding for the IV-B grant program has grown very little
since 1980 while the IV-E program has grown rapidly. The emphasis in
Federal funding may appear unintentionally to be on maintaining
children in out-of-home care, and not on providing services so that
children can be either safely returned to their families or adopted in
timely fashion.
As a result, there is now interest in increasing the amount of
flexibility States have in using their IV-E dollars. On September 26,
2000, Chairman Johnson introduced H.R. 5292, a bill that would provide
flexible funding demonstrations to determine whether providing States
with flexible funds for child protection has an effect on caseload
levels, enhances availability and use of services, efficiency of
service delivery, and child safety, permanency, and well-being. The
goal is to find ways to allow States to use the IV-E dollars for
prevention and treatment as well as out-of-home placement.
The bill includes three options that would increase flexibility in
State use of Federal IV-E dollars. In the first approach, States would
negotiate a baseline of expected spending with the Secretary of the
U.S. Department of Health and Human Services. States would then receive
the exact amount of money specified in the baseline in quarterly
payments and would be free to spend the dollars on any child protection
activity including prevention, treatment, and out-of-home care.
However, States could return to the IV-E program of open-ended funding
at the start of any fiscal year. In the second approach, States would
also negotiate a baseline. In this case, however, States would identify
a specific intervention program expected to save money by reducing out-
of-home care or by other means. If the program does save money, the
savings could be transferred out of the IV-E program into the IV-B
program where States would have more flexibility in using the funds for
prevention and treatment. The third proposal would strengthen the
current waiver authority for child protection programs in the Social
Security Act, especially by allowing permanent waivers.
States have already shown their interest in flexible Federal
funding by taking advantage of Federal legislation enacted in 1993 that
provides them with the opportunity to obtain waivers from Federal child
protection law. Several States are now conducting waiver programs to
test whether they can use the greater flexibility permitted by waivers
to improve their child protection programs. Other States have simply
moved ahead on their own with new methods of financing child protection
services.
In announcing the hearing, Chairman Johnson stated: ``We must do
everything we can to promote safe and loving homes for children.
However, current law provides open-ended entitlement dollars for
putting children into foster care, but limits the amount of money for
treating at risk families and providing services to children. I believe
we must find ways to allow States to flexibly use Federal funds to
enhance the availability and use of services and to promote the safety,
permanency, and well-being of these vulnerable children.''
FOCUS OF THE HEARING:
The hearing will provide an opportunity for witnesses to give their
reactions to H.R. 5292.
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noted above.
Chairman Johnson. As many of you know, I have been working
for well over a decade to give States greater control over the
Federal resources we provide to them to battle against child
abuse and neglect. I recognize that the current structure of
Federal funding, which includes capped and relatively small
resources for prevention and treatment as contrasted with open-
ended and rapidly-growing entitlement funds for out-of-home
placements, has achieved the very worthy purpose of leading to
big increases in Federal spending on child protection, but we
are spending most of our money on out-of-home care.
Here is the essence of the proposals I have been making for
many years. Give States exactly the same amount of money they
would get under current law. Depending on the State and the
time period, this amount would almost always increase every
year, sometimes substantially. Then let the States decide
whether to spend the money on prevention, treatment, court
procedures, out-of-home care, or any other of the scores of
worthy purposes.
Let me tell you why I think this approach would be better
than current law. Once we provide financial incentives for
States to keep children out of foster care or to minimize the
length of time they spend in foster care, I believe States will
take three actions.
First, they will do a better job of preventing the removal
of children from homes, and we now frankly have lots of
evidence to support this belief.
Second, they will increase the quality of their casework
and the efficiency of their administrative procedures. The
result will be that when States do remove a child from her
home, States will take much less time than currently to push
the case to a decision about permanency, whether that means the
child is returned home or the parental rights are terminated.
Third, States will increase their use of adoption, even
above the current very high level.
Let me assure everyone with a concern with the nation's
child protection system that I have never been interested in
saving Federal money with my flexible funding proposals. In
fact, not only do States receive all the money they have
coming, including projected spending increases, but the
Congressional Budget Office has consistently scored my
proposals as putting additional Federal dollars into the child
protection system. In fact, that has been one of the problems.
They score my bill as a coster. You ought to be for that.
In the past, I have been constructively criticized by
Democrats and child advocates for endangering the major source
of funding growth in the Federal child protection system and
for placing children at risk. I have never doubted the
sincerity or usefulness of these criticisms. In fact, over the
years, I have made many perfecting changes to my basic proposal
to respond to these criticisms.
I believe the proposal we introduced last week responds to
all the important problems raised by critics of my earlier
legislation. All of the child protections of current law are
preserved. The two funding flexibility proposals are confined
to a maximum of ten demonstration States, which will allow a
fair test of whether States can use the funding flexibility to
good effect.
And above all, we have developed two mechanisms, one with
extensive help from the American Public Human Services
Association, to protect the open-ended entitlement while
simultaneously allowing much greater flexibility in State use
of Federal resources. And equally important, given the research
funds in my bill, we are nearly certain to learn a great deal
about how States react to the new funding flexibility and
whether they are, in fact, able to advance a child's safety,
permanency, and well being.
We received several frantic calls that because our bill
replaces the current Section 1130(a) of the Social Security
Act, we are repealing the Suter provision we worked so hard to
enact several years ago. Let the record show that the Suter
provision was mistakenly put into two sections of the Social
Security Act. Once our bill replaces the Suter provision in
Section 1130(a), it will still have a comfortable home in
Section 1123, where I expect it will live a long and useful
life.
I fervently hope that we would be able to enact our funding
flexibility proposal in the 106th Congress, but I am realistic
and I now have concluded that the stars are not yet in the
correct alignment to allow this proposal to pass both houses of
Congress and be signed by the President. I held this hearing
today because I want to create a permanent record that this
bill is well worth enacting and it will lead to a new era of
protecting our nation's most vulnerable children. In fact,
hopefully, with Ben Cardin's help, we will be back in this room
in February marking up this legislation and finding a way to
push it through the Senate into public law.
Finally, I thank all the State officials, members of
Congress, and child advocates who have worked so hard to help
us improve this proposal. The American Public Human Services
Administration, under the inspired leadership of Bill Waldman,
deserves a special note of thanks. I think that because of the
tireless and sustained efforts of all those who have helped
with this bill, we are very close to bipartisan agreement on a
new vision of child protection.
I would also like to say personally that if you go back to
the first time I introduced this legislation in the late 1980s,
you will see that under it, States would have gotten more money
than they are currently getting. It really is a tragedy that
because of fear we were unable to pass this legislation that
would have given children hope in America. I say that very,
very seriously. We have in this bill mechanism that allows
States to realize dollars in the future that they may not now
qualify for or if they have an unexpected change in the number
of children eligible for foster care they can go back to the
old entitlement process. I believe the mechanism we have in
this bill is better than the mechanism we had in the 1980s
bill.
But I really am urging the community to begin to understand
and ask themselves, can we in good conscience go forward and
predicate the majority of money for child protective services
on out-of-home placement in an era when there are major, major
policy initiatives already in place that are going to reduce
the number of children in foster care, i.e., reduce the money
flowing to States.
So I think if you really are concerned about funding for
child protective services, you really have to look at this bill
as a very progressive and very important step forward, and I
really regret that there is not the commitment to move this
through the House because I think it would put us in a much
better position next session to go the whole way. But I cannot
do that alone at this time in the year. You know that. I know
that. I am utterly realistic about that.
But I do say to you, mark my words, our primary job is to
see that the States have money. They are going to need more
money for these children because they are difficult children
and some are not adoptable. These children need a much
different support service system just like in welfare. Welfare
succeeds because we have a much bigger series of services that
help with the transition.
So it is a sea change we have to make. We cannot let our
fear of losing the entitlements prevent us from developing a
strong funding system to strengthen families as a whole.
So I regret that we cannot go further, but I think it is
very important to set the record today, to begin to look at how
far States have already come and the remarkable things that are
happening as a result of waivers that allow this approach and
also to allow those that still have reservations to put those
reservations on the record.
Mr. Cardin?
Mr. Cardin. Thank you, Madam Chair, and thank you for the
passion you bring to this subject. This will probably be the
last hearing of our subcommittee in the 106th and let me just
take a moment, if I might, to congratulate you, Madam Chair,
for an outstanding record in this 106th Congress. I am very
proud to have been your partner in the work of this committee.
We have passed some extremely important legislation. Some
has already been enacted into law. And we hope that we will get
the other body to pass some bills before they adjourn and I
think we can be very proud of the record that you have achieved
during this Congress. You have truly put our most vulnerable
first before politics and have been willing to reach out to
each member of our committee, Democrat and Republican alike,
and I personally thank you for that and you should be very
proud of the record of this committee.
Chairman Johnson. Thank you.
Mr. Cardin. Madam Chair, your legislation that is before us
today, raises some very important issues, particularly the need
for preventive family-oriented services designed to reduce out-
of-home placement of children. However, I believe the bill
needs work in three areas.
First, the legislation does not acknowledge a fundamental
issue, namely that new resources are needed to protect and care
for our nation's most vulnerable children. I am not alone in
coming to this conclusion. Earlier this year, Governor Bush
proposed an additional $1 billion in Federal assistance for
State efforts to provide services to families in the child
welfare system. I should point out that these proposed new
funds were not contingent upon saving money in foster care or
other programs dedicated to helping at-risk children, nor was
the funding limited to only a few States.
Second, if we want to provide additional flexibility for
State child welfare programs, it seems to me that it would be
wiser to modify the existing waiver process rather than
establish not one but two new demonstration programs. This
point seems particularly salient when you consider that we have
not yet fully evaluated the 30 child welfare waivers that have
already been approved by HHS. These current law waivers are
testing a variety of reforms, including providing more
preventive services to families in or identified by the child
welfare system.
In fact, my home State of Maryland has had three child
welfare waivers approved by HHS, one designed to provide
substance abuse services to the parents of at-risk children,
another to promote certain kinship arrangements in which family
members become permanent guardians, and a third to test managed
care payment policies for children in foster care.
My final concern about this bill is that its first section
amounts to an optional block grant for foster care and adoption
programs in up to five States. I am worried that this could be
seen as a Trojan horse which is ultimately aimed at block
granting the entire foster care system.
As a member who supported the TANF block grant, let me say
I do not support efforts to reduce the Federal presence in
ensuring protection and permanency for abused and neglected
children, particularly when about half the States are under
some form of court order to improve their child welfare
systems. Furthermore, it is worth remembering that this
committee endorsed the idea of increased, not reduced, Federal
oversight of the child welfare system when it passed the
bipartisan Adoption and Safe Families Act in 1997.
Madam Chair, as we continue to consider how to promote our
shared goal of improving the nation's child welfare system, I
urge the committee to keep two general ideas in mind. First, we
can and should increase State flexibility, but never at the
expense of State accountability. And second, money spent
helping at-risk children live safely with their families or
become adopted into a loving home is money very well spent.
Finally, I want to thank you, Madam Chair, for postponing a
markup on this legislation. As you pointed out in your opening
statement, your intentions in holding this hearing is to
establish a record rather than trying to move legislation in
this Congress. Pursuing consensus and bipartisanship is worth
waiting for, especially when enactment of a proposal that seeks
anything less is very unlikely at the end of a Congressional
session.
I thank you very much for convening this hearing and I also
would like to acknowledge that we have a very distinguished
group of witnesses today and I am very much looking forward to
their help as we try to sort out these issues.
Chairman Johnson. Thanks very much, Ben, for your kind
comments and for your work on this committee. We could not have
produced so much good legislation without working together
closely on a lot of things, and we have done that.
I would also like to thank Nick Gwyn for his good work
throughout these two years and a special thanks to Ron Haskins,
for whom this also is a last hearing. He has been an absolute
stalwart advocate of children and children's interests for many
decades, and Ron, we salute you.
[Applause.]
Chairman Johnson. If the panelists will come forward,
please, William Waldman, Executive Director of the American
Public Human Services Association; Wendell Primus, Director of
Income Security, Center on Budget and Policy Priorities; Fred
Wulczyn, Chapin Hall Center for Children in Chicago; Sharon
Daly, Deputy to the President for Social Policy, Catholic
Charities; Robert Geen, Senior Research Associate, Urban
Institute; and the Honorable Kathleen Kearney, Secretary,
Florida Department of Children and Families.
Some of you have testified before us in the past and we
welcome you back. Others of you are new and we thank you for
being here. Mr. Waldman?
STATEMENT OF WILLIAM WALDMAN, EXECUTIVE DIRECTOR, AMERICAN
PUBLIC HUMAN SERVICES ASSOCIATION
Mr. Waldman. Thank you, Madam Chair. Mrs. Johnson, Mr.
Cardin, members of the committee, I want to thank you again for
the opportunity to be here a second time to testify on this
bill and be with you.
I want to also sincerely express my appreciation for your
ongoing commitment and persistence and obvious passion on this
issue. The kind of bill you have introduced really, I think, is
the solution for a lot of issues that are wrong with the system
now that will permit the kind of flexibility with
accountability that States require, and most importantly,
result in better outcomes for safety and permanency for the
kids that we care about.
I want to especially thank you also for the opportunity to
work with you and introduce our idea on the transferability,
which I believe is the second title or component of the bill.
We are proud that that is in there.
The association that I represent, I think has a significant
contribution to make to this debate. They are the folks that
operate these programs 24 hours a day, seven days a week. They
have the passion, the heartache sometimes associated with that
responsibility. We represent them on a fully bipartisan basis
and our conclusion is identical to the one that you discussed,
that the current system of financing Federal child welfare
services is fundamentally flawed because it rewards the
outcomes that we want to avoid, that it pays for the deepest
end of the system.
Just compare the over $5 billion I think we will have spent
this last year for out-of-home care for 4(e) services as
combined to the maybe $600 million that we spend on the other
side of the equation for primary and preventive care.
We have done, as you know, some extensive work on this
issue. We have had a two-and-a-half-year bipartisan task force.
We have retained outside experts, at least one of whom is here
today. We are proud to cosponsor a forum on the Hill with
advocates, staff from both sides of the aisle to explore these
areas and others. And ultimately, what this bill provides is
the balance of two items that are necessary to make a
difference, the flexibility for the State but no step back
whatsoever in the accountability for the outcomes that have
been specified and the regulations associated with that law and
the maintaining of all the Federal protections that are in
previous law for children. We think that is real important.
I am also very pleased with the modifications to the waiver
process that are incorporated in this bill. Those are very,
very important. If you think about the Medicaid program, the
kind of waivers this moves towards is the kinds of waivers in
the Medicaid program that transformed it from a program that
was fixed in funding nursing homes, institutions, emergency
rooms, and hospitals, and the proliferation of those waivers
really enabled home and community-based services that not only
helped contain costs, but more importantly resulted in better
outcomes, senior citizens able to live their twilight years
with their homes and families.
I was struck by your words at the last hearing where you
kind of challenged us to come up with something more bold. I
could not forget those, and I gave that a lot of thought. I
want to just remention something I had mentioned the earlier
time. In our proposal as an association, we had come up with an
idea about delinking Federal 4(e) eligibility from the old AFDC
standard of 1996. I understand when Congress passed that part
of the law, it was kind of an agreement to go back and revisit
that, as well, and I hope you would.
My view is, if you combine-our vision for this, to meet
your challenge to bold, we would be to have a system where all
children are covered by eligibility, number one, that the
flexibility that you have incorporated into this bill be
broadly expanded to no more than just a few, or ten--which is
significant, but only ten--and you add in the accountability
and the protections, and I think you have got a mix of a simple
program, then, with uniform clear eligibility, clear outcomes
and standards that would promote the kind of flexibility that
results in innovation and creativity that I know you are after.
So I think that might work.
I want to stop for a minute just to really commend the
States for the progress that has been made. I know you are
aware that just a couple weeks ago or so the Secretary
announced the adoption of bonuses. As you know, there has been
a great increase to 42 States. We had a 20 percent increase in
the number of adoptions, up from about 37,000-something to
46,000. And one might legitimately ask, if States are doing so
well, why do we require these additional amendments?
I would say to you, as someone who is a former State child
welfare administrator and a commissioner, I think we have
cleaned up the backlog and I think we are on the right trail,
but my view is in order to maintain, sustain, and expand this
progress to keep children safe and move towards permanency, we
need the kinds of flexibility that are inherent in your bill
over time so that we are not back here in a couple years
bemoaning problems that have occurred and backups in the
system.
We do have several suggestions with respect to concerns on
the legislation I would like to highlight briefly. One is a
limitation in numbers. I could not agree with you more about
the scoring of these proposals. I think no matter what, whoever
scores these needs to realize the level 4(e) expenditures are
going up. They have been going up and it is not unreasonable
to, as the bill provides, suggest a baseline.
Two is that I am very concerned in the first title about
the language around the maintenance of effort provision. I
think that goes beyond the matching that is current
traditionally required, that would be continued. It even goes
beyond what is required in the maintenance of effort for
welfare in the TANF bill, as well. From my own experience, I
think that this provision might throw a serious wet blanket on
States' desire to innovate because treasurers and governors
will look at this broad provision, which will be very
contentious in implementation, to identify what expenditure
qualifies and what does not and, I think, serve to work against
the purposes that we are trying to achieve, as well.
I would also suggest we could limit the use of the random
assignment research in there, I know the bill encourages that
we do that. Many States find that onerous. It is difficult. It
takes years for the research. I am not saying we should not do
that again, but I think what the Medicaid experience did to the
1915 series of waivers permitted a usually used type innovation
not to have a random assignment in each and every State it is
assigned to. I think it would promote more participation.
I think we need, I tend to agree, we need more investment
in this field.
Chairman Johnson. Bill, we do have to wrap up because we
have some people who have planes to catch.
Mr. Waldman. I surely will. I just want to close and again
thank you. We know that our delinking proposal is difficult, it
raises issues of geopolitical issues and formulas. We would
offer ourselves to work with you, and I would say that if given
the restrictions that you put out early in terms of the
schedule and everything else, if we could do nothing else other
than to expand the waivers that you provided this time, and
revisit the other parts next time, I think we will have made
some progress in this.
Thank you. It is a delight to be here again.
[The prepared statement follows:]
Statement of William Waldman, Executive Director, American Public Human
Services Association
Chairman Johnson, Congressman Cardin, Members of the
Subcommittee, I am william Waldman, Executive Director of the
American Public Human Services Association (APHSA). I am
pleased to once again have the opportunity to testify about
reforming the child welfare financing system and legislation on
flexible funding for child protection programs.
As the national organization representing State and local
agencies responsible for the operation and administration of
public human service programs, including child protection,
foster care and adoption, APHSA has a long-standing interest in
developing policies and practices that promote improved
performance by States in operating these programs for our
nation's most vulnerable children and families. On a personal
level, I've had a long career as an administrator of public
human services, and served as a State child welfare director
for part of my career.
On behalf of State human service administrators and child
welfare directors, I want to take a moment to commend you,
Madam Chairman, for your continued efforts to reform the child
welfare financing system and for your commitment to safety and
permanency for our nation's most vulnerable children. Your
leadership and concern for this issue have been outstanding and
we know how passionate you feel about ensuring that States have
the needed flexibility to enable them to make continuous
improvements to the system, while remaining accountable for the
outcomes we all want. I also want to thank you and your staff
for working so closely with APHSA over the past months on the
language in the bill regarding APHSA's transferability
proposal. We appreciate the opportunity to have input into such
an important process.
Everyone involved with the child welfare system recognizes
that States face serious challenges in the administration of
child welfare programs. At the meeting on flexible funding that
APHSA had the pleasure of cosponsoring with your office in May,
there was broad consensus that the current Federal financing
system disproportionately funds the deepest and often least
desired end of the system-out of home care-that we are all
striving to minimize in terms of lengths of stay and numbers of
children. On the other hand, funding directed at activities to
achieve permanency, safety, prevention and early intervention
are comparatively limited. As a result, the system does not
support the outcomes for children and families embraced in
statute, regulation, and general public policy and practice.
States need additional flexibility to better serve children and
families, and at the same time are committed to maintaining
accountability for outcomes and key protections for children.
APHSA has committed a great deal of time and resources to
study and propose alternative financing structures that will
result in meaningful child welfare reform. We convened a
special task force in early 1998 to develop recommendations on
restructuring child welfare financing. In July 1999, our
National Council of State Human Service Administrators adopted
a policy resolution supporting two proposals-transferability
and delinking. As you have recognized, one of the most serious
constraints for States is a Federal financing structure for
child welfare that reinforces perverse incentives and that does
not allow States the flexibility to implement programs and
policies that would result in the desired outcomes for
children.
Flexibility in the use of Title IV-E dollars must be
afforded to States so that they can invest these dollars in the
kinds of activities that are yielding success and go to scale
with innovative programs that work-activities such as
subsidized guardianship, performance-based contracting, post-
adoption services, cross-system collaborative efforts with
substance abuse agencies and juvenile courts-all of which are
promoting more safe, stable and timely permanent arrangements
for children, whether they be adoptions, reunifications or
guardianships. The transferability option we developed as
included in this bill allows States the option to reinvest IV-E
funding into IV-B services, while retaining both State
accountability and the entitlement structure. We think that
this transferability proposal will enable States to make the
kinds of investments in front end and post-placement services
that are needed to protect children's safety and provide them
with a variety of permanency options. Because flexibility for
States is so important, we are disappointed that this option,
which holds so much potential for providing States with the
tools they need to make effective changes, is limited to only
five States. We believe that any attempt to truly reform child
welfare financing must give all States the opportunity to
advance cutting edge child welfare programs and practices.
In addition to the transferability proposal, we believe
that the following modifications to the current IV-E wavier
process in the bill would go a long way towards adding
flexibility to child welfare financing:
Elimination of the limitation on the number of
waivers,
Ability to conduct Statewide demonstration
projects,
Elimination of the limitation on the number of
States that can receive a waiver on the same topic,
Elimination of the limitation on the number of
waivers that may be granted to a single State,
Conditional authority to conduct demonstration
projects indefinitely,
A streamlined process for consideration of
amendments to demonstration projects requiring waivers and,
The permissible use of historical baselines.
These are important modifications to the waiver process.
Many States that have been interested in waivers as a tool for
reform have declined to participate because of Federal
implementation limitations, and we think that these provisions
will go a long way towards fulfilling the original promise of
the waivers that unfortunately has not been realized due to
overly prescriptive and rigid Federal implementation.
Let me be clear that even while the system is in serious
need of reform, States have made and continue to make
tremendous strides, both as a result of the Adoption and Safe
Families Act (ASFA) and due to individual State initiatives.
Recent statistics have demonstrated significant State successes
in increasing the number of adoptions of children from foster
care. In fact, just two weeks ago Secretary Shalala announced
that nearly $20 million in adoption bonuses, a program enacted
through ASFA, will be distributed this year to 42 States, the
District of Columbia, and Puerto Rico, for increasing the
number of children adopted from foster care. The number of
States receiving bonuses is up from 37 in 1999, with each State
and the District of Columbia and Puerto Rico having qualified
for funds for one or both years of the program. HHS reported
that 46,000 foster care children were legally adopted in FY
1999, a 28 percent increase over the 36,000 adoptions in FY
1998 and a 64 percent increase over FY 1996's 28,000 adoptions.
States have been so successful in increasing the number of
adoptions that they actually earned over $50 million in
bonuses. I would like to take a moment to point out that
because only $20 million has been authorized for this purpose,
States were only awarded a portion of the $50 million they
earned. The Senate version of the Labor-HHS-Education
Appropriations bill includes an amendment by Senator Mary
Landrieu (D-La.) that increases the amount of the adoption
bonuses to $56 million. I want to thank you Mrs. Johnson for
your support on adoption bonuses in the past and ask for the
continued support from members of the subcommittee for
increased authorization and appropriations for adoption bonuses
so that States will receive the rewards they deserve and have
this promised funding to spend on services to children. In
order to ensure that this improvement and innovation is
sustained and expanded, we must remove barriers to optimal
performance.
In response to your call at the July hearing for us to
think more broadly and boldly on these issues, I would like to
take this opportunity to expand a bit on APHSA's other proposal
to reform child welfare funding-delinking IV-E eligibility from
AFDC. Delinking eliminates the IV-E eligibility link to the old
AFDC program, providing Federal matching funds for all children
in foster care or receiving adoption assistance, rather than
just covering those who are from poor families of origin. Good
public policy calls for a Federal commitment to all children in
foster care, as well as eliminating a complex and outdated
eligibility determination process that is a costly and onerous
administrative burden on States, and that takes time and
resources away from serving children and families. This change
would require a new funding scheme which has difficult and
contentious geopolitical implications. APHSA would like to work
with Congress and the Administration to craft a delinking
proposal that would be equitable to States and enable a true
Federal-State partnership.
While we are thankful for your efforts to reform the
financing system, and appreciate your including the concept of
transferability in your legislation, we have some concerns
about particular aspects of the bill. In addition to concerns
regarding the limit on the number of States that can
participate in these demonstrations that I mentioned earlier,
we have some additional concerns.
With respect to the consolidated grant option, I would like
to note APHSA's strong objection to the proposed maintenance of
effort requirement (MOE). The new mandate is quite different in
design from the TANF block grant MOE. Let me be clear. We
believe that in exchange for greater flexibility in the use of
IV-E funds, it is reasonable to require States to maintain
their historic State IV-E match. However, we believe that it is
simply unjustified to require States to maintain their child-
welfare related expenditures under TANF, Social Services Block
Grant, and the Medicaid program and in hundreds of State or
locally funded programs. The requirement is far too expansive
and imposes a burden disproportionate to the flexibility that
the IV-E block grant may provide. Inclusion of this MOE as part
of this option may well have the effect of discouraging States
from taking advantage of much-needed flexibility. We urge you
to revise this requirement.
With respect to the provision requiring national evaluation
as it relates to the two sets of flexible funding
demonstrations, we are concerned that the encouragement of the
use of random assignment will have the effect of limiting
States' ability to pursue these demonstrations Statewide and
will constrain full implementation across a State's caseload.
The requirement for random assignment in the current waiver
program has been significantly limiting, and, in fact, you seek
to mitigate this in the Title II Waiver Modifications
provisions. We urge you not to create the same problem in these
new demonstrations as you simultaneously address that problem
in the current waiver program.
Many States have innovative ideas they are ready to pursue
in child welfare and system reform. However, they will not be
able achieve significant reform if they are not allowed the
flexibility to make these programs reality. Significant
restructuring of Federal child welfare financing is crucial for
providing the child welfare system with the capacity it needs
to be accountable in terms of the outcomes of safety and
permanency that are now required by law, and flexibility in
Federal financing would support the strides States are making
toward improving the system.
But, increased flexibility alone will not be enough for
States to reach desired outcomes for children. In addition to
making investments through better spending of existing
resources, I am convinced that States also need additional
Federal investments in child welfare services. Both
reinvestment and new investment are needed if we want to meet
the increased demands, expectations and capacity needs these
systems are facing. It is time for the Federal Government to
fully share in the commitment of preventing child abuse,
keeping children safe and moving them towards permanency as
expeditiously as possible.
Unfortunately, given the limited amount of time on the
Congressional schedule for the rest of this year and the
unpredictability of the legislative process, it is unclear that
comprehensive child welfare reform will be achievable this
session. In order to better serve the children for whom they
are responsible, the immediate needs of State public agencies
must be addressed as soon as possible. I encourage you to help
States now by implementing Title II of the legislation--
modifications to the current waiver system, as well as the
increased adoption bonuses as part of the Labor-H
appropriations bill in this session of Congress.
We would like to work with you and all the members of the
subcommittee to rise to your challenge of broader system
reform. I also want to again extend the offer to work with you
on legislation that would delink Title IV-E from AFDC, as it is
long past due to address this complicated look-back provision
established in the 1996 welfare reform law. The provision was
meant simply to be a short term solution, and was enacted with
the promise that it would be addressed at a later time. That
time is now.
Madam Chairman, I want to thank you again for taking the
lead on this important issue and we appreciate the opportunity
to work with you.
Chairman Johnson. Thank you very much. I am going to have
to keep it at five minutes the first time through and then we
will be able to come back through questions to have some
discussion amongst panelists thereafter.
Wendell?
STATEMENT OF WENDELL PRIMUS, DIRECTOR OF INCOME SECURITY,
CENTER ON BUDGET AND POLICY PRIORITIES
Mr. Primus. Madam Chair and Congressman Cardin, thank you
for the opportunity to testify on child welfare legislation.
Let me just say at the outset that I agree wholeheartedly with
the comments that Congressman Cardin made. I think you have
established a good record and Ron, in particular, has been a
joy to work with over the past year on child support
legislation. I even noted that the New York Times said it is
one of the five things that ought to get done this year. So I
hope you can convince the other body to move forward on that
important legislation.
Mr. Cardin. I do not know whether that helps us or hurts
us.
[Laughter.]
Mr. Primus. I appreciate your continuing efforts to call
attention to the system and its shortcomings and the goals you
have advanced in H.R. 5292. Federal funding patterns for child
welfare services over the last 20 years clearly demonstrate the
need for additional funding, as well as the need for additional
flexibility. Only 28 percent of those children who meet the
more stringent definition of child maltreatment, the harm
standard in the third national incidence study, had been
investigated by child protective services, and nationally, only
half of those children actually receive services, and in some
States that is as low as one-quarter of the cases where an
investigation has substantiated an incidence of child neglect
and that child receives services. I think that makes the case
for additional funding.
I am pleased that H.R. 5292 includes the child protection
provisions and it keeps the entitlement. And also, the other
important protection is the strong maintenance of effort that
you have attached to the consolidation of grants pilot. This
MOB is essential to assure that overall funding for child
welfare services does not decrease. The MOB language contained
in your bill recognizes that every State's child welfare
spending is a unique mix of Federal, State, and local funds. It
recognizes that Federal funds may fluctuate from year to year.
It gives States flexibility to count expenditures made by other
agencies, such as substance abuse treatment or mental health.
I realize that this is a very sensitive issue with States,
but under TANF, supplementation did happen, and not because any
one official thought it was a good idea. The supplementation
that occurred in Wisconsin under TANF did not happen because
the governor proposed it. Rather, it happened in the give and
take of the State legislative process and competition with
other State spending priorities. And the additional provisions
that require careful monitoring and evaluation of the impact of
the pilots is also extremely important. I believe that the MOB
provision that you apply to the consolidation of grants pilot
should also be applied to the transfer of funds pilot.
Although I agree with the goals of H.R. 5292, I believe
that a simpler and more direct way of providing additional
funding to States would work much better. These pilots are
really predicated on the assumption that the CBO baseline for
mandatory 4(e) spending was growing too rapidly and many felt
this growth would never materialize. In essence, both types of
pilot projects were innovative attempts to take advantage of
this budgetary situation and convert what were perceived by
some to be bloated projections into real dollars for funding
prevention services under child welfare. I could not agree
more.
But while some of this growth may be excessive, States do
have an incentive to constrain costs in 4(e). They match it.
And I do not believe that States are intentionally placing too
many children in 4(e). I also believe that the amount of money
a State receives should not depend upon projections negotiated
between Federal and State bureaucrats. These projections are
likely to be wrong and probably will not reflect a State's true
need for funding. And I think cost considerations should not
guide decision making at the front lines. What is in the best
interest of the child should be the primary criteria.
By fixing the amount of funds a State receives, it implies
that States should bear all the costs of any additional
children that need to be served, and frankly, State child
welfare administrators do not control entries into their
system. They do have some extent over the length of time, but
not the entry.
My primary argument is that a more direct and simpler
method of providing additional funds to States--you could do it
like you did under ASFA or setting up a pool of funds for
States to compete--either of these approaches seem preferable
to the funding mechanism in H.R. 5292.
I also think you need to do a comprehensive review of the
entire system. Substance abuse is often a factor in cases of
child neglect. I think an important component is the
coordination between these two systems. I think you should also
look at the bills that improve the capacity of courts.
And shortly after I became staff director way back in 1991,
I was amazed to learn that 4(e) was not a universal program. If
a child is a victim of abuse or neglect to such an extent that
a State court declares that the child must be removed from the
home, why should the Federal Government deny funding to States
for those neglected or abused children? The States do not have
that choice. And furthermore, it costs us money to make that
administrative determination.
So in conclusion, Madam Chair, I strongly agree with your
last statement at the prior hearing that we need to be bolder.
I would urge that you develop a broad consensus on how the
Federal involvement in the child welfare system should change.
I would urge this subcommittee to work over the next several
months, and your staff, to conduct a comprehensive review of
the entire system to address concerns raised by this panel and
at your hearing in July, develop a much bolder plan that
revamps the Federal role in the child welfare system, increases
Federal funds significantly, and then convince the new
administration that this should be an important priority for
Congress and the nation. Thank you.
[The prepared statement follows:]
Statement of Wendell Primus, Director of Income Security, Center on
Budget and Policy Priorities
Introduction
Madam Chairman and Members of the Subcommittee on Human
Resources:
Thank you for the opportunity to testify on child welfare
legislation, specifically H.R. H.R. 5292, the Flexible Funding
for Child Protection Act of 2000.\1\ My name is Wendell Primus
and I am Director of Income Security at the Center on Budget
and Policy Priorities. The Center is a nonpartisan, nonprofit
policy organization that conducts research and analysis on a
wide range of issues affecting low-and moderate-income
families. We are primarily funded by foundations and receive no
Federal funding.
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\1\ I want to acknowledge and thank MaryLee Allen of the Children's
Defense Fund and Rutledge Hutson of the Center for Law and Social
Policy for the significant contributions they made in the preparation
of this testimony. However, neither they nor their organizations should
be held responsible for the recommendations and analysis outlined in
this testimony.
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The child welfare system serves the nation's most
vulnerable children. These are children who are neglected or
abused by their parents. Unfortunately, substance abuse is
often a contributing factor to this sad state of affairs. The
workers at the front lines must confront these stark realities
day after day and make tough decisions such as whether to
remove a child from the home because the safety of the child is
at risk, whether to reunite children with parents because the
parent has made progress in once again being able to care for
their children, and whether to terminate parental rights. These
decisions in many instances must be ratified by a court system.
I appreciate the work and wisdom of these front-line workers
and efforts it takes by States and local governments to achieve
a well-functioning child welfare system.
Madam Chairman, I also appreciate your continuing efforts
to call attention to this system and its shortcomings, your
leadership in important child welfare reforms over the years,
including the recently enacted Foster Care Independence Act,
and finally for the goals you have advanced in H.R. 5292. I am
in full agreement that States need additional funding and
flexibility to operate their child welfare systems, and that
States should be able to receive Federal assistance for all
children under their child welfare systems. Your leadership has
helped us find new ways to keep children safe and move them to
adoptive families.
I hope now that we can build on the recent bipartisan
improvements made in child welfare and in child support as
well. Therefore, I would urge the Subcommittee to wait until
early next year to pass legislation and to develop a broad
consensus on how the Federal involvement in the child welfare
system should change. There is no compelling reason this
legislation needs to be enacted this year. As I will outline
below, a much more comprehensive review of the entire system is
needed. More Federal funding of the child welfare system is
needed. Both major Presidential candidates, particularly
Governor Bush, have recognized this need. In light of the
Federal budget surpluses, I would urge that this Subcommittee
work over the next several months to conduct a comprehensive
review of the entire system to address concerns raised by this
panel and at your hearing in July, develop a much bolder plan
that revamps the Federal role in the child welfare system,
increases Federal funding significantly, and convince the new
Administration that this should be an important priority for
Congress and the nation.
More Federal Funding and Flexibility Are Needed
Federal funding patterns for child welfare services over
the last 20 years clearly demonstrate the need for additional
funding as well the need for more flexibility. Currently, the
Safe and Stable Families portion of IV-B is funded at $295
million, and the Child Welfare Services Program is authorized
for $325 million but appropriations total only $292 million.
CAPTA and the Community Based Family Resource Program add an
additional $100 million. These amounts are all relatively small
and have grown little in the past 20 years. Compare this to the
$5.0 billion we spend on IV-E foster care and adoption
payments, and related training and administrative costs, in
fiscal year 2000.
The gap between out-of-home spending and prevention monies
is huge and growing. For example, assuming that the two Title
IV-B programs were level funded and targeted, the amount of
Federal spending for prevention services (adjusted for
inflation) will decline by 37 percent per child in IV-E while
out-of-home spending will grow by 22 percent between 1989 and
2004 based on CBO projections. Rob Geen's work at the Urban
Institute shows that for every $1 a State spends on prevention,
child protective services and case management services, they
spent more than $3 covering out-of-home placements, adoption,
and administrative costs.\2\
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\2\ The Cost of Protecting Vulnerable Children: Understanding
Federal, State, and Local Child Welfare Spending, The Urban Institute,
1999.
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There is evidence that there are insufficient services to
children who need them. Only 28 percent of those children who
met the more stringent definition of child maltreatment (the
``Harm Standard'') in the Third National Incidence Study had
been investigated by child protective services agencies.\3\
Recall Judge Kathleen Kearny's testimony before this
Subcommittee on July 20th that of the 38 percent of child abuse
hotline calls whose allegations were investigated and
unsubstantiated, one-third were subsequently reported for new
allegations of abuse that were substantiated. Nationally, only
slightly more than half of those children whose cases are
substantiated receive services beyond the investigation. This
percentage varies widely by State but most States fall between
25 and 75 percent.
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\3\ Third National Incidence Study of Child Abuse and Neglect: NIS-
3, National Center on Child Abuse and Neglect, September, 1996.
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Such figures imply that in some States, the State provides
additional services in only one-quarter of cases where an
investigation has substantiated an incidence of child neglect
or abuse. Many States lack the capacity to provide necessary
front end services. This is not just a matter of not having the
funding; some States do not have the service providers to offer
services, particularly in the area of substance abuse
treatment. These States will not be able to take advantage of
the flexible funds until such capacity can be developed. H.R.
5292 does not help to create that capacity because no
additional monies are available for capacity-building.
In his testimony before this Subcommittee on July 20th,
Bill Waldman, Executive Director of the American Public Human
Services Association, said that ``the system needs additional
investments in child welfare services [and] these investments
come in two ways.'' The first is new investments, the second is
``better spending of existing resources.'' He concluded that
both are needed and I agree. Yet, the money for new investments
should not be contingent on reduced caseloads and the timing of
these two approaches in relation to providing additional child
welfare services is critical. Redirecting resources will not be
sufficient until we provide child welfare programs with
additional resources for new investments.
Relative to other Federal-State partnership programs like
child support, Medicaid or TANF, the Federal Government
provides substantially less financing to the child welfare
program. Based upon Census data, the number of children living
with neither natural parent or adoptive parents increased from
1.8 million in 1989 to 3.0 million in 1998, a 67 percent
increase. Only a small percentage of these children
are currently being served under the child welfare system. I
realize that not every child not living with either parent
needs to be served by the child welfare system, but this fact
does demonstrate the need for additional funding and raises
questions about the extent and coverage of the child welfare
system.
Protections, Entitlements, and Maintenance-of-Effort Requirements in
H.R. 5292
H.R. 5292 is one way to provide additional funding and
flexibility to the States administering the child welfare
system. H.R. 5292 provides States more flexibility in the use
of their IV-E funds so that they can provide more front-end
services rather than spending money on out-of-home placements.
I am pleased that H.R. 5292 as introduced includes a number
of provisions to help ensure that children get the quality care
that you intend, and that Federal funding for child welfare is
not diverted to other spending priorities. Regardless of the
funding mechanism chosen, it is important that these provisions
are included. I would like to highlight several provisions that
have been significantly strengthened in the bill as introduced,
and I appreciate the attention your staff has given to these
important concerns.
Protections and Entitlements
It is critically important to be clear that the protections
and entitlements available to children under current law will
be maintained in these new pilots and I believe that your bill
does that. The existing Child Welfare Waiver Demonstration
Program that you championed maintains both the protections and
entitlement, and similar language is used in H.R. 5292.
Maintenance of Effort
Another important protection in H.R. 5292 is the strong
maintenance of effort (MOE) provision that you have attached to
the ``Consolidation of Grants'' pilot. A strong MOE provision
is essential to ensure that overall funding for child welfare
services does not decrease once States have increased
flexibility in the use of their funds. There is a broad
consensus that child welfare funding should not be reduced
given the unmet needs that remain. The MOE provision for the
``Consolidation of Grants'' pilot requires States to maintain
total child welfare spending from all sources, Federal, State
and local, and thus ensures that funding for child welfare
services will not decrease during the operation of the pilots.
Before making a case as to why this same MOE provision
should be applied to the ``Transfer of Funds'' pilot, let me
emphasize several of its important characteristics:
The MOE language recognizes that in every State
child welfare spending is a unique mix of Federal, State, and
local funds. By requiring the maintenance of Federal, State,
and local spending, States are treated equitably in the effort
they must make to ensure that dollars for children in the child
welfare system are not cut back.
The MOE language recognizes that Federal funds may
fluctuate from year to year and specifically allows States to
adjust their spending baseline when Federal child welfare
spending is decreased.
The MOE language gives States flexibility to count
expenditures made by other agencies, such as substance abuse
treatment or mental health agencies, on behalf of children and
families in the child welfare system, when new investments are
made by these agencies.
The MOE language also gives States leeway in
complying with the MOE requirement. It takes into account the
fact that expenditures within a State may fluctuate some from
year to year and therefore only holds States accountable for
maintaining their effort based on a two year rolling average.
The MOE requirement gives State child welfare
agencies leverage in budget discussions. The potential
penalties created by the provision make it easier for States to
maintain spending for child welfare and thus enhance the
likelihood that the demonstration will enhance access to
services and improve outcomes for children and their families.
If the Federal Government makes available more funding for
child welfare, a State should not be allowed to spend less than
it otherwise would have. In most cases, the baseline that would
be agreed upon between the Secretary and the State would assume
that the State is increasing State expenditures. The State
should be required to maintain this level of effort. I realize
this is a very sensitive issue; States and State officials take
umbrage in requiring a MOE because there is an implicit
assumption that the States would lower their own spending when
the Federal Government increases their spending on a particular
program -an assumption that they insist would not happen.
But under TANF it has happened, and not because any one
official thought it was a good idea. The supplantation that
occurred in Wisconsin under TANF did not happen because the
Governor proposed it. Rather it happened in the give and take
of the State legislative process and competition with other
State spending priorities. A strong MOE requirement is needed
because States have many other important spending priorities
(e.g., education, transportation, and nursing homes), and
extraneous forces can reduce State spending on child welfare
services. A strong provision is critical to this bill because
it gives States an important tool which will enable child
welfare administrators to insure that spending on their program
does not decline.
Monitoring and Evaluation
The addition of provisions in H.R. 5292 that require
careful monitoring and evaluation of the impact of the pilots
is also extremely important. It is essential that we know from
the beginning what specific services and activities States plan
to provide with these more flexible funds. You have required a
description of services in States' initial plans, but also
recognized that plans may change during the course of a
demonstration and put a process in place for States to amend
their plans when necessary. The national evaluation will
provide useful information on how the evaluation has enhanced
the availability and use of services as well as child safety,
permanency, and well-being. I am very pleased with how these
provisions have evolved.
Technical Changes
Before moving on to a discussion of the bigger picture, I
wanted to spend just a few more minutes highlighting a couple
important questions about H.R. 5292 as introduced.
Maintenance of Effort for the ``Transfer of Funds'' Pilots
As I alluded earlier, I am very concerned that H.R. 5292
does not apply the same MOE provision to both of the pilots. I
believe the MOE provision that applies to the ``Consolidation
of Grants'' pilots should also be applied to the ``Transfer of
Funds'' pilots. To participate in the Transfer pilots, a State
should be required to maintain its overall level of spending
for child welfare services. It should not be permitted to use
the flexibility of this demonstration to supplant or reduce
existing spending.
As drafted, the MOE provision that applies to the Transfer
pilots in H.R. 5292 permits States to supplant current child
welfare spending with their new flexible dollars and also
allows States to reduce total spending on child welfare
services if their foster care caseloads decline. Under the
Transfer pilots, a State will negotiate an anticipated baseline
of IV-E foster care maintenance and/or administrative spending.
If the State submits claims totaling less than that baseline
amount for IV-E foster care expenditures, it is permitted to
use the ``freed up'' amount, the difference between the
baseline and actual claims, for any child welfare services
which help achieve the purposes of the bill.\4\ However, to
receive those ``freed up'' funds, the State must meet a MOE
requirement.
---------------------------------------------------------------------------
\4\ The State must use the funds consistently with the plan filed
as part of its application for the demonstration (subsection
(c)(1)(B)), however, the State can amend this plan at any time as long
as the amended plan is consistent with the provisions of the bill
(subsection (d)).
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It is not clear to me from the bill what the intention is
behind the MOE requirement in the Transfer pilots. Does it
require a State to maintain its State effort at the level that
would be necessary to claim the full amount in the State
baseline? For example, if its IV-E match is 50 percent, must it
agree to keep State spending at a level that is at least
equivalent to 50 percent of the total State baseline? \5\ Or,
alternatively, do States have the ability to spend only a
portion of their ``freed up funds'' and as a result only
maintain State funding at a level that would be necessary to
match that amount of expenditures? \6\
---------------------------------------------------------------------------
\5\ If this is the goal, the language of the bill does not appear
to accomplish it. The formula in section (c)(4)(C) allows the State to
reduce the MOE amount below this level, although this appears to be a
drafting error, rather than an intentional reduction.
\6\ Regardless of the intention, the language in the bill seems to
permit this flexibility and thus permit States to reduce overall
spending on child welfare services.
---------------------------------------------------------------------------
While a correctly drafted provision that bases the MOE
amount on the total State baseline, rather than the amount of
funds the State receives, would hold State spending at the
level anticipated in the baseline, it would not prevent the
``freed up'' dollars from being used to replace other State
spending for child welfare services. For example, suppose a
State negotiated a baseline of $100 million but had IV-E claims
of $80 million. It could use the $20 million of ``freed up''
funds to pay for a home-visiting program or for a post-adoption
services program previously funded with State dollars. This
supplantation would lead to no net gain in the funds available
to provide child welfare services, a result that seems contrary
to the purposes of the bill.
If the intention of the MOE provision in the Transfer
pilots is to give States the flexibility to take less than the
full baseline amount (e.g. not all of the ``freed up'' funds),
States may find themselves unable to take advantage of ``freed
up'' funds. For example, a State may come to the end of the
year and have $20 million in ``freed up'' funds, but be unable
to convince the legislature to allocate the MOE funds needed to
receive even a portion of those funds. The strong requirements
and penalty provisions of the MOE requirement in the
Consolidation of Grants pilots would offer much more leverage
to States and increase the likelihood that the State
maintenance of effort amount would be provided and the
availability and use of services would be enhanced through the
pilots. Thus, regardless of the intent behind the MOE provision
of the Transfer pilots, I do not believe the provision
sufficiently safeguards child welfare spending. As I mentioned
earlier, I believe the MOE provision for the Consolidation
pilots should also apply to the Transfer pilots.
However, if a decision is made to continue with a different
MOE provision for the Transfer pilots, at a minimum, the
provision should require States to maintain a level of spending
equivalent to the State match for the total amount of State
baseline and the provision should contain non-supplantation
language similar to that in the Safe and Stable Families
Program and the Chafee Foster Care Independence Program.
Relationship Between TANF and Child Welfare MOE Requirements
It is possible that some additional modifications may be
needed in this MOE provision. For example, some concerns have
been raised that this provision may effectively create an
earmark within the TANF program for child welfare spending in
those States that have already been spending TANF dollars on
child welfare. We need to address this issue to ensure that
States continue to have full flexibility in the use of their
TANF dollars.
Clarifying Activities for Which the Funds will be Spent in the
Transfer Pilots
As I have described earlier, we applaud the language in the
Consolidation pilots that requires that the plan include a
description of each activity for which any of the amounts would
be expended. I recommend that same language be in the plan for
the Transfer pilots, and expect that it was a technical error
that it was not.
Suter Language
Under current law, the ``Suter language'' in the section on
the Effect of Failure to Carry Out State Plan in the Social
Security Act is in two places. I understand from conversations
with Subcommittee staff that the removal of the Suter language
from section 1130A of the Social Security Act was only an
effort to remove the duplicative language in the Act and that
there was no intention to remove the Suter language. The Suter
language is retained in section 1123 of the Social Security
Act.
Is H.R. 5292 the Best Way to Provide Additional Funding and
Flexibility?
Although I agree with the goals of H.R. 5292, I believe
that a simpler and more direct way of providing additional
funding to States would work much better. Both the ``Transfer
of Funds'' and the ``Consolidation of Grants'' pilots are
predicated on the assumptions that additional Federal funding
for child welfare was not politically possible, and that the
CBO baseline for mandatory IV-E spending was growing too
rapidly--many felt this growth would never materialize. In
essence, both types of pilot projects were innovative attempts
to take advantage of this budgetary situation and convert what
were perceived by some to be bloated projections into real
dollars for funding prevention services under child welfare.
Accomplishing this under H.R. 5292 requires that projections be
made for each State as to what its spending would be under IV-E
and either allowing a transfer of some portion of mandatory
spending to fund services or giving the State the monies it
would have received under the projection and allowing it to be
spent on a broader set of activities.
This mechanism is not ideal for several reasons:
The political assumption that additional funds
were not possible may no longer be correct.
While some of the growth in IV-E caseloads may be
excessive, more attention to placing children in safe and
stable families is needed. Because States share in the cost of
IV-E, States have some incentive under current law to lower
their IV-E caseloads. I do not believe States are intentionally
placing too many children in IV-E. However, States do not
receive sufficient monies for service to prevent out-of-home
placements, or sufficient monies to reunify families. This may
lead to a greater number of children in out-of-home placement
than necessary.
The amount of money a State receives should not
depend upon projections negotiated between Federal and State
bureaucrats. These projections are likely to be wrong and
probably will not reflect the States true need for funding. One
method to determine the feasibility of a new financing approach
is to examine how it might have worked during a historical
period. Pretend you are in 1992 and you need to make
projections of IV-E caseloads in 1994. Table 1 shows the
average monthly number of children in foster care in 1986,
1990, and 1994 in selected States. How would one predict for
each State the caseload three years into the future?
(Projections of dollar amounts, which are required under H.R.
5292, would have difficulties similar to projecting caseload.)
Clearly the projections would be based on more information than
just these historic caseloads for two points in time, but this
an important starting point. Look at the variation by State in
the growth in the IV-E caseload between 1990 and 1994 relative
to growth between 1986 and 1990. Arizona is a good example.
Between 1986 and 1990, the caseload increased by 80 percent,
from 481 to 866. A baseline calculated with these numbers would
leave the State with substantially fewer funds per foster
child; between 1990 and 1994 Arizona's caseload almost tripled,
reaching 2,697. This State presumably would have had to revert
back to current law if it had opted for the ``Consolidation of
Grant'' stream. In contrast, in North Carolina, the caseload
more than doubled between 1986 and 1990, and then leveled off
between 1990 and 1994. If the baseline were based on caseload
between 1986 and 1990, North Carolina would have come out
substantially ahead in funding, and its investment in service
dollars would appear to have been extremely successful.
Finally, in some States even the direction of caseload trends
changed during the same time period: in Maryland, for example,
between 1986 and 1990 the caseload fell from 1,511 in 1986 to
803 in 1990; by 1996, it had more than quadrupled, reaching
3,553. How much funding is really needed is based upon many
factors that are outside the control of State administrators--
changes in the culture of courts and their decision-making
process, economic factors in which studies show a strong
correlation between child abuse and poverty, and changes in
substance abuse patterns or the appearance of new drugs.
Table 1
Title IV-E Foster Care Average Montly
Number of Children for Selected States
1986 1990 1994
Arizona....................... 481 866 2697
Delaware...................... 289 125 221
Hawaii........................ 46 41 530
Idaho......................... 435 138 280
Maryland...................... 1511 803 3553
Newe Jersey................... 3840 2816 3715
North Carolina................ 1411 3561 3550
Washington.................... 983 2751 1989
Wisconsin..................... 2620 5562 4780
These proposals raise fundamental problems which
H.R. 5292 does not address. For example, how will future
projections be made? What happens after the first three years?
How does the Secretary or the State estimate growth under
current law? If the ``Consolidation of Grants'' proposal is
successful for the first three year period, how does the
Secretary project growth for the second three years? Will those
States continue to get substantial amounts of funding for
prevention services based on their reduced caseloads? Or
consider the opposite case. How will the estimates be done when
the strategy, despite the best efforts of the State, has still
resulted in substantial foster care growth?
Cost considerations should not guide decision-
making at the front line. The ``best interests'' of the child
should be the primary criteria guiding decision-making. By
fixing the amount of funds a State receives, it implies that
States would bear all of the costs of any additional children
that need to be served. This is not a true Federal-State
partnership. I am concerned that we will pay States to lower
foster care caseloads, not by the provision of additional
preventive services, but by other mechanisms.
Caseload reduction should not be our primary goal
in the child welfare system. Caseload reduction in child
welfare carries much greater risks than caseload reductions in
TANF, because the effects of bad decisions are much more
serious. The child welfare system has some very difficult
decisions to make: a) Is the system removing children from
parents when necessary; b) Are they being reunified when
appropriate; c) Is the system terminating parental rights
appropriately so adoptions can take place; d) When children are
removed, are the alternative care arrangements appropriate--the
use of kin-care, the use of very intensive institutional
settings when needed, and finding the right foster care
parents. These are only a few of the decisions that the system
must make. I am concerned about creating a system where the
financial incentives not to remove a child have been made even
greater. The right decision in one set of circumstances is the
wrong decision in a different set of circumstances.
I believe that the amount of Federal funds a State receives
should not be based on a negotiation about budget projections
between State and Federal officials. I know of no other
instance where the amount of funding a State receives from the
Federal Government is based upon a negotiation of what spending
would be under current law. As shown above, these estimates are
prone to large estimating variances and depend upon factors
outside the administrator's control. There is a lot of
guesswork in making State-by-State projections and the range of
reasonable projections is huge.
Madam Chairman, I do believe the negotiating process over
baselines anticipated by H.R. 5292 would result in getting
substantial more Federal funding to the States involved in this
demonstration. If I believe in more Federal funding for child
welfare services, why make this case against your funding
mechanism? I do not think this approach is sustainable and
services do not automatically translate into lower caseloads.
My primary argument is that there is a more direct and simpler
method of providing additional funding to States. This could be
done in any number of different ways. One approach is to
provide the services dollars necessary under Title IV-B to
implement ASFA, and letting the ingenuity of the States
determine how these additional dollars will be spent.
Another approach is providing a significant pool of funds
for competitive grant child welfare monies that would be
awarded to States to determine if additional funding for
services would allow them to better meet the goals of the child
welfare system. I would require a small State match of 10
percent or so. This means State officials would have to go
through some effort to get State approval. This approach could
then study where the additional monies are spent and determine
whether the goals of a child welfare program are better met.
Either of these approaches seem preferable to the funding
mechanism outlined in H.R. 5292.
The Need for A Comprehensive Review of Federal Funding and Child
Welfare Programs
Besides the need for significant amounts of additional
funding and flexibility, there are several other important
reasons why a more comprehensive review of the entire pattern
and nature of child welfare financing is needed. As a recent
Urban Institute study illustrates, funding today for children
in the child welfare system is scattered over a wide array of
Federal programs.\7\ Today, child welfare is funded by IV-B and
IV-E programs, the Social Services block grant, TANF, Medicaid
and the CAPTA programs. States make substantial different
decisions about which kinds of children are funded from these
different sources.
---------------------------------------------------------------------------
\7\ The Cost of Protecting Vulnerable Children: Understanding
Federal, State, and Local Child Welfare Spending, The Urban Institute,
1999.
---------------------------------------------------------------------------
As I mentioned previously, substance abuse is often a
factor in cases of child neglect and many States lack the
capacity to provide front-end services, particularly in the
area of substance abuse. Bills such as S. 2345 and H.R. 5081,
which address child protection and substance abuse and the
coordination between these two systems, need to be part of a
comprehensive review.
There also are important bills that have been introduced in
the Senate to improve the capacity of the courts to meet the
new timelines for decision making in the Adoption and Safe
Families Act that should be part of this package. The Promoting
Safe and Stable Families Program, including the State Court
Improvement Program, also has to be reauthorized next year, and
that too will help increase the capacity of States to better
support families and promote adoptions.
Beyond those suggestions, I believe a comprehensive review
should result in recommendations that would include:
Universal coverage of all children who are abused
or neglected,
Significant additional amounts of Federal dollars,
Additional flexibility to States of where
additional dollars should be spent,
A reexamination of the interaction between child
welfare and other programs such as TANF and juvenile justice.
Universal Coverage of All Children Who Are Abused or Neglected
Shortly after I became staff director of this Subcommittee
back in 1991, I was amazed to learn that IV-E was not a
universal program. I can understand why TANF, food stamps or
the Medicaid programs should have a means-test. But if a child
is the victim of abuse or neglect to such an extent that a
State court declares that the child must be removed from the
home, why should the Federal Government deny funding to States
for these neglected or abused children? The States do not have
such a choice and clearly have an obligation to provide
services and assistance to these children. Furthermore,
determining whether the parent would have been eligible for
AFDC assistance under the rules that prevailed in July, 1996
costs significant administrative dollars. The Federal-State
partnership would be stronger if the program were made
universal. This might be one way of providing additional
assistance to States. This aspect of the program should be
reviewed.
In addition to a reexamination of which children are
eligible for foster care payments, there needs to be a
determination of what package of services these children should
be provided through IV-E. I realize that open-ended funding of
additional services may risk increases in Federal spending
beyond what is politically feasible. This review should examine
various options for reducing this risk. These options could
include State matching rates, aggregate caps on spending for
services, or limits on the time or amount of services provided
per child.
Interaction Between TANF and Child Welfare
Many children today whose parents are no longer able to
care for them are placed informally (sometimes formally) with
grandparents or other close relatives. For these children, the
traditional goals of a child welfare system may need to be
modified somewhat.\8\ Not all of these caretakers necessarily
need assistance. But States need more flexibility in deciding
how these caretakers should be treated. The use of TANF funds
to finance child welfare services should be reexamined when
many parents still need employment services and work supports
such as child care to help them find and retain jobs, and when
more assistance is needed to lift children out of poverty.
---------------------------------------------------------------------------
\8\ Rob Geen, ``In the Interest of Chidlren: Rethinking Federal and
State Policies Affecting Kinship Care,'' Policy & Practice, American
Public Human Services Association, March, 2000.
---------------------------------------------------------------------------
Conclusion
In conclusion, I remember well what you Madam Chairman said
at the last hearing and I strongly agree that we need to be
bolder. Additional funds are needed to increase the capacity of
the child welfare system to provide up-front services that
allow children to remain safely in their homes, to be quickly
returned if removal is necessary, and to move to adoption when
appropriate.
I would urge you to move forward carefully, however, and to
take the next several months to build broad consensus on how
the Federal involvement in the child welfare system should
change and to develop a much bolder plan that structurally
revamps the Federal role in the child welfare system. We must
re-examine which maltreated children, or children at risk of
maltreatment, should be eligible for Federal support and what
that support should look like. As I mentioned, I do not believe
it makes sense to continue to tie eligibility for IV-E to the
old AFDC standard and I think that policymakers and advocates,
from both parties and from the Federal, State and local levels,
should continue to discuss what the eligibility criteria for
Federal support to vulnerable children and families should look
like.
An important part of our bigger look at child welfare
reform must be looking at the interaction between child welfare
and other systems, like TANF and Juvenile Justice. Especially
in TANF, we see many points in which the two systems overlap.
Some of the children and families served are the same and the
problems families on the rolls face, and their service needs,
also are similar. In some States children with kinship
caregivers who are receiving TANF funds are in the formal
foster care system and in others they are not. We have to take
a more careful look at issues like these as we move forward.
Chairman Johnson. Thank you. Dr. Wulczyn?
STATEMENT OF FRED WULCZYN, PH.D., CHAPIN HALL CENTER FOR
CHILDREN, CHICAGO, ILLINOIS
Dr. Wulczyn. Madam Chair, members of the committee, thank
you for inviting me here to speak today. My name is Fred
Wulczyn. I am a research fellow at the Chapin Hall Center for
Children at the University of Chicago, and for the past ten
years I have been studying issues related to finance and child
welfare. Most recently, I have worked in the City of New York
helping Commissioner Scapetta and his staff design a system for
financing services that blends positive incentives for
providers of foster care with vigorous monitoring while
protecting the entitlement for foster care.
That work has been praised by the court-appointed panel
overseeing the child welfare reform in the City of New York. I
mention this because my remarks today are based on the
practical experience of helping a jurisdiction create the kind
of financing system that your legislation speaks to.
Flexibility is an issue that will keep coming back to the
Congress. History says as much. We have been dealing with the
issue of flexibility for the last 35 or so years in various
disguises. The dynamic, the reason why it keeps coming back has
less to do with the tension between block grants and
entitlements, as some would characterize the reason for its
inevitable return, and has more to do with the issue of
outcomes and the fact that there is increasing pressure on the
States to achieve better outcomes for children and families.
The dynamic basically is the same as the tension between
having responsibility but no authority. As States are pressed
to be more accountable for the things they do for children and
families, they are going to want to have control over the
resources at their disposal to accomplish those objectives.
I think that the question of flexibility returning is
important also because the longer it takes to deal with the
question of flexibility, the more likely frustration will build
so that less positive types of Federal legislation are more
likely to pass, so that if we can act now, proactively, I think
we can avoid legislation that is less desirable.
Another issue that we are seeing is that in health care, as
in child welfare, we observed over the last 20 years or so that
the question of how services are purchased is as important as
what services are purchased. The cost reimbursability rules
that are in Federal law today sets a tone as to what services
are purchased that invades all levels of State and local
government and restricts the flexibility. By limiting how
States are allowed to purchase care, we necessarily limit
flexibility.
I think the legislation that is proposed accomplishes two
very important things. First, it preserves the entitlement. I
think there has long been an assumption that flexibility and
entitlements are mutually exclusive policy concepts and I think
that the various proposals that are included here, the waiver,
the modified block grant, if that is a fair characterization,
the transferability, adequately address the question of whether
or not the entitlement can be preserved in the context of
flexibility.
As I see it, what in effect the legislation accomplishes is
that it establishes a floor below which Federal funding would
not fall as opposed to a ceiling above which Federal fiscal
responsibility could not rise, and those are fundamentally
different ways to characterize the role of Federal financing.
Second of all, the law grants State flexibility. There are
certain realities with respect to incentives. The first is that
there is no such thing as an incentive-free system. So we do
not want to push States into adopting flexible programs without
carefully considering the issues of local context and how any
given system of incentives would work.
Similarly, incentives have to be sensitive to time, place,
and context. There is considerable variation in State
performance, and within States county performance, and within
counties provider performance. The idea that a one-size-fits-
all response to this variation would be useful and
constructive, I think is a somewhat tenuous assumption. States
should be encouraged to adopt incentives that are appropriate
for their local jurisdiction and the issues that they face and
they are not uniform.
Finally, States are not equally equipped to use incentives.
This is an issue of how well they are able to aggressively
monitor and track outcomes. Clearly, performance is leveling
off in that regard. States are more able to do that. But
whether or not they can enter into vigorous systems of tracking
outcomes is a developmental question. Over time, we can expect
that to improve, but pushing States into a one-size-fits-all
set of incentives, I think is a risky proposition from the
Federal Government's perspective.
Finally, in effect, what we are dealing with here are
issues about the efficient distribution of care and resources
and outcomes will eventually be paired with the question of
need. Flexibility is not an inoculation against the requirement
that we focus on the issue of whether or not the basic
commitment to meeting the needs of children is being met by the
current Federal commitment. I think we will continue to expect,
as Wendell suggested, that the issue of need and whether or not
there is enough money to go around, even with flexibility, is
going to be a recurring theme, as well. Thank you very much.
Chairman Johnson. Thank you very much. Ms. Daly?
STATEMENT OF SHARON DALY, VICE PRESIDENT FOR SOCIAL POLICY,
CATHOLIC CHARITIES USA, ALEXANDRIA, VIRGINIA
Ms. Daly. Thank you very much, Mrs. Johnson. I would like
to, first of all, thank you very much for this opportunity to
testify. I want to start with thanking the chair and Mr. Cardin
for their extraordinary work on behalf of the Title XX social
services block grant program this year. A billion dollars has
come out of services for children because of those cuts and it
is critically important that your efforts in persuading the
Senate to restore that funding are successful, not only for
children in the child welfare system, but for elderly and
disabled people and other people in need. So I want to thank
you for that.
I also think the record of the subcommittee on the Adoption
and Safe Families Act, the fatherhood provisions, child support
enforcement, has been extraordinary and I certainly hope that
your efforts succeed before we all get to go home.
I have just come back from spending five days with about
700 of the Catholic Charities local direct services providers
who gathered in Kansas City for our annual meeting and there is
no issue in their view that is as important as reforming the
child welfare and foster care systems. So we are very grateful
for the attention that this issue is getting, but also grateful
that markup of the bill is postponed until we have time to
really think through all the implications of the bill.
Catholic Charities USA, as you know, represents 1,400
member agencies. We serve more than ten million people a year,
about 90,000 children in residential care and foster care in
our care, and so we have a big stake in this. Actually, from
its very first work in 1727, Catholic Charities agencies have
been caring for homeless mothers and children, people who have
been abandoned by the system.
Mrs. Johnson said at the beginning of the hearing, our
primary job is to see that States have the money to care for
these children. Well, there is nothing more important than
that. That is exactly right. That is why we are all here. How
do we make sure that the States have the money to care for
these children?
So, of course, I am very skeptical about any danger at all
to the entitlement and am very glad that the chairlady is
sensitive to that issue. I am very concerned, as Wendell Primus
pointed out, that maintenance of effort provisions that are
already in the bill be maintained and also added any time there
is additional flexibility for the States.
At the bottom of the list of priorities in any State
legislature is the children in the child welfare system, and
there is nothing that is more dangerous than allowing the State
legislatures to get off the hook with funding. So maintaining
maintenance of effort requirements, making sure that the States
have to invest, and making sure that the States meet
requirements continue to be very important.
There has been a lot of talk here about State flexibility.
Well, I represent the people who need flexibility the most and
have absolutely none, the people who are faced with a family
where there is terrible substance abuse, where there is neglect
or abuse, and all of the options are bad--inadequately funded
foster care with untrained parents, unsupervised homes, lack of
treatment for the parents, lack of mental health services, lack
of care for the children who are already so traumatized by the
situations in their families. It is the workers who do direct
services who have no flexibility.
I met recently with Jack Smey from Catholic Charities in
Connecticut and Pat Johnson, who is the director in Hartford,
and said, what can we do to fix the system? Should we have
foster care review boards, as Mr. Grassley suggests? Should we
change the reimbursement mechanisms, as Mrs. Johnson suggests?
And they both said, as all the other Catholic Charities
agencies in the country say, it is really a matter of more
resources. How do we get more money into it?
And I would ask the subcommittee to not go with the
assumption that we have to have a budget-neutral bill, that we
have to restrict expenditures for foster care maintenance in
order to get more services into prevention and keeping families
together.
Foster care is terribly underfunded. Of course, it is not a
great option to have children in foster care, but our foster
care and residential care treatment programs typically do not
even get a two percent increase per year in cost of doing
business from their State legislatures. The amount of money to
pay foster parents is so inadequate that it is very difficult
to get qualified people to take care of these children. More
and more States are putting very severely traumatized children
in regular foster care instead of in treatment and residential
care.
We may have fewer children coming into the system, and I am
not sure that is right, whether the States are always going to
be keeping families safe when they keep children out of foster
care. You know, we are all very happy about the adoption
bonuses. We all feel good that there are more kids who have
been adopted. But when I heard that the District of Columbia
was one of the States that got an adoption bonus, I was really
shocked, because this Congress has heard incredible testimony
over the past few months about the terrible, terrible
deficiencies in the child welfare system in the District.
So when we devise new incentives and new funding
mechanisms, we have to be careful we do not send a message we
only care about adoption or we only care about reducing the
number of kids in foster care. Sometimes foster care is the
best place for a child. Very often, temporarily, at least, that
is a good place for a child. So sending a message to the States
that we are going to reward certain things and not others and
not taking into account the total operation of a system is
really a mistake, I believe.
I would also like to mention that we are strongly in
support of a bill that Mr. Rangel and Mr. Cardin have
introduced that would provide nearly $2 billion of additional
resources to States for mental health and substance abuse
treatment for the families of children in the child welfare
system. Nothing could be more important. The States estimate
that 80 percent of these families have substance abuse and
mental health problems and very rarely do they get the right
kind of treatment.
The way Medicaid provides reimbursement, and the way the
substance abuse block grant program works, is that people are
rotated in and out of short-term drug treatment and never
really have addressed the underlying serious, dangerous mental
health problems that those parents have, that substance abuse
is really only a symptom. And until the Federal Government
requires the States to change the way they reimburse and to
make sure we have integrated mental health and substance abuse
treatment and that it is available to those families, and not
just to the moms but to the children who have been traumatized,
we are not going to see children grow up healthy and safe. So I
urge that that be included among your deliberations.
[The prepared statement follows:]
Statement of Sharon Daly, Vice President for Social Policy, Catholic
Charities USA, Alexandria, Virginia
Good morning. My name is Sharon Daly, and I am the Vice
President for Social Policy of Catholic Charities USA. I am
pleased to testify today on behalf of our organization.
Catholic Charities USA is the nation's largest private
network of independent social service organizations, working to
support families, reduce poverty and build communities.
Annually, our 1,400 member agencies provide services to over 10
million of the most vulnerable people in our country, including
more than one million children. In 1997, Catholic Charities
agencies provided more than 89,197 children with residential
care, foster care and group home care.
Catholic Charities USA appreciates that this subcommittee,
under the leadership of its Chair, Nancy Johnson, and its
ranking minority member, Ben Cardin, is focusing on the
question of resource distribution in the Federal child welfare
system. With regular input from our Catholic Charities agencies
across the country, Catholic Charities USA has long been an
advocate for increasing Federal support for preventive services
while ensuring State accountability for children's safety.
However, while we agree that there must be more resources
devoted to preventive child welfare services, we do not think
the approach taken in H.R. 5292 is the right response.
Quite simply, this bill fails to address the most critical
shortcomings of the child welfare system: inadequate Federal
funding for child welfare services, insufficient Federal
dollars allocated to the treatment of substance abuse and
mental health problems suffered by families in crisis, and the
failure of Congress to acknowledge the need to provide a range
of social supports for poor families. This bill appears to
approach the problem of inadequate resources by allowing States
to move existing dollars from one urgent need to another.
Catholic Charities USA shares the subcommittee's concerns that
States need additional resources for preventive child welfare
services. But in a time of unprecedented economic prosperity,
we believe Congress should do more to heal families and protect
our nation's children.
Today I will speak briefly about some of the components of
H.R. 5292 and make some suggestions about where I believe
Congress should be focusing its efforts in the 107th Congress.
I would also ask permission to submit, at a later date, a more
detailed analysis of H.R. 5292 for the record.
Block Grants
H.R. 5292 provides for two new demonstration projects.
Under the first, up to five States could receive all or a
portion of their Title IV-E adoption or foster care funds as
block grants. Currently, under existing law, in order to
receive Title IV-E funds, a State must submit a plan that meets
a number of detailed requirements outlined in Section 471 of
the Social Security Act, including provisions to ensure
children's health and safety that were recently enacted by the
Adoption and Safe Families Act of 1997 (AFSA). Under H.R. 5292,
however, it appears that to be eligible for a block grant, a
State would no longer be required to meet the requirements of
Section 471. Rather, a State would only be required to submit a
plan that:
Describes how the funds received under the block
grant will be used;
Makes the same assurances that States are
currently required to make in their Title IV-B State plans
pursuant to Section 422(b)(10) of the Social Security Act (for
example, a State must make assurances that it is operating an
effective Statewide information system to track children in
foster care and that it is operating a preplacement preventive
services program for children at risk of foster care
placement); and
``Does not impair'' a child or family's
entitlement to benefits under the State's existing Title IV-E
plan.
In addition, the bill includes a requirement that
participating States maintain 1998 expenditure levels for the
activities covered by the block grant.
H.R. 5292 would also allow participating States to delink
eligibility for foster care and adoption assistance payments
from the current income requirements. In other words, a State
could make adoption assistance payments to any family that
adopts a child, regardless of the income of the child's prior
family.\1\ States could elect to continue delinking these
payments beyond the expiration of the demonstration project.
Catholic Charities USA has always supported delinking foster
care and adoption payments from the current income
requirements, and we are pleased that such a provision has been
included in the bill.
---------------------------------------------------------------------------
\1\ Foster care payments may be delinked only if the State has
submitted an application to block grant its foster care payments.
---------------------------------------------------------------------------
However, Catholic Charities USA has concerns about
consolidating into a block grant Federal reimbursement for an
activity as critical as the protection of our children. As we
read it, the bill exempts States who participate in the block
grant program from important Federal requirements which
currently govern State foster care and adoption programs. Prior
drafts of this bill required States to show that their use of
the block grant funds would comply with the requirements of
their Title IV-B or IV-E State plans. We are not sure why this
provision was changed in the final bill. We believe that the
States' record on child welfare issues and particularly on
protection of children does not justify a relaxation of Federal
standards in this area.
Transfer of Title IV-E Foster Care Funds
H.R. 5292 proposes a second demonstration project specific
to the foster care program. Under the ``transfer'' provisions,
the bill appears to allow up to five States to retain the
difference between the State's estimated Title IV-E foster care
entitlement funds and the actual amount of its eligible foster
care expenditures in a given year. In other words, if the
State's eligible foster care expenditures in a given year are
less than the amount which the Department of Health and Human
Services and the State originally estimated that the State
would need, the State can keep these ``savings.'' We understand
that the intent of this provision is to allow States to
recapture these funds and use them for other child welfare
purposes.
Under existing law, in order to receive Federal foster care
payments, a State must submit a State plan which meets a number
of detailed requirements, including provisions designed to
ensure children's health and safety that were added by ASFA.
Under this provision of H.R. 5292, to be eligible to
participate in this incentive program, States must submit a
plan which meets only those same requirements as are required
of State plans submitted for the block grant proposal: the plan
must describe how the funds will be used; States must make the
same assurances as those required under Section 422(b)(10) of
the Social Security Act for the State's IV-B plan; and States
must not ``impair'' the child or family's entitlement to foster
care payments. In addition, a State is required to maintain at
least a certain level of foster care expenditures.
As noted above in our comments for the block grant
provisions in this bill, Catholic Charities USA is concerned
about relaxing the Federal standards that currently govern
State foster care programs. Again, we note that prior drafts of
this bill also required States to show that their use of Title
IV-E funds would continue to comply with the requirements of
their Title IV-B or IV-E State plans. We are not sure why this
provision was dropped from the final bill. Further, we are
concerned that this ``transfer of savings'' provision provides
a disincentive for States to ensure that all children in need
of foster care are placed in the foster care system. To ensure
the protection of children, Catholic Charities USA believes
States should be rewarded only when their activities and
programs improve child welfare outcomes.
In addition, Catholic Charities USA is concerned that this
provision sends an incomplete message to the States by
directing incentives only at the foster care program. We are
concerned that an unbalanced approach could have perverse
results. For example, a participating State with an abysmal
track record for the overall performance of its child welfare
system could nevertheless receive additional funds under this
proposal for controlling its foster care expenditures. It
defies logic to reward a child welfare system that improves in
only one area, while failing overall in its mission to serve
families and protect children.
Expansion of Waiver Authority
H.R. 5292 would also expand the Department's authority to
waive Federal requirements in order to allow more States to
carry out more child welfare demonstration projects with
greater flexibility.
Catholic Charities USA strongly supports the provision in
this bill that would permit multiple States to pursue similar
demonstration projects. However, Catholic Charities USA does
not support a general expansion of the Secretary's waiver
authority at this time. Current law already gives States the
flexibility to pursue worthy demonstration projects, and we
think that any generalized expansion of this flexibility would
be premature and unnecessary. We understand that 22 States and
the District of Columbia are operating demonstration projects
under waivers from the Department. As these demonstrations are
still in the early stages, it is too soon to know whether these
projects are improving child welfare systems.
Lack of Resources
Catholic Charities USA understands that the intent of H.R.
5292 is to allow States to retain unspent Title IV-E
entitlement funds so that these funds can be spent for child
welfare purposes and not end up back in the Federal treasury.
We appreciate the intent behind this bill, and thank the
subcommittee again for focusing on the issue of insufficient
resources for State child welfare systems. However, we question
whether this bill needs to include exemptions from current
Federal requirements in order to allow States to keep unspent
adoption and foster care funds.
I think we all recognize that in order to improve child
welfare services and outcomes, Congress must commit to
significant increases in funding for child welfare programs.
Although this bill may allow States to hold on to more of the
allotted Title IV-E dollars, real reform of the child welfare
system is not possible without substantial additional Federal
resources. As I stated earlier in my testimony, Federal budget
surpluses have provided us with a window of opportunity to
accomplish significant reforms in the existing child welfare
system. Catholic Charities USA stands ready to work with the
subcommittee to accomplish this critically important goal.
And when I talk about real reform of the child welfare
system, I am not just talking about more money for Title IV-B.
One of the most critical problems affecting the child welfare
system is the lack of comprehensive substance abuse and mental
health treatment for families. Our best hope for securing a
safe and happy future for our children is to appropriate the
resources necessary to heal and preserve broken families. The
States estimate that over two-thirds of parents involved in the
child welfare system need substance abuse treatment, yet
existing treatment resources meet less than one-third of that
need.\2\
---------------------------------------------------------------------------
\2\ Child Welfare League of America, Alcohol and Other Drug Survey
of State Child Welfare Agencies (1998).
---------------------------------------------------------------------------
In addition, Catholic Charities agencies serving these
families are convinced that at least 80 percent of parents with
persistent substance abuse problems are also suffering from
serious mental health disorders. We have found that integrated
mental health and substance abuse treatment programs are rarely
available. Because treatment for substance abuse and mental
health disorders are typically offered through separate
programs, with separate reimbursement methodologies and program
requirements, it is virtually impossible for any single
provider or program to offer comprehensive, integrated
substance abuse and mental health treatment.
For example, last weekend at the Catholic Charities USA
annual conference, we heard testimony from the Catholic
Charities agency in Omaha about their substance abuse program.
Catholic Charities of Omaha runs the Omaha Campus for Hope, the
largest provider of addiction recovery services in the State.
To cobble together the appropriate treatment for persons
suffering from substance abuse and mental health disorders, the
Omaha program must often refer clients back and forth between
different programs. When their clients have maximized the
treatment resources available in one program, they are
transferred to another program (which often means a different
site, a new provider, and different program requirements). They
told us that the experience was enough to make a healthy person
``schizophrenic,'' and that, all too often, troubled clients
and overextended staff are unable to negotiate the system.
The problem is not just a lack of resources overall devoted
to substance abuse and mental health treatment, or a lack of
consistent payment methodologies and requirements. Most
treatment programs are predicated on a single adult model and
fail to address the complex problems of parents. Parents
require treatment programs that wrap services and healing
strategies around the particular challenges of raising a child.
They need special parenting classes and support, and their
children need counseling for potential emotional or mental
health problems.
In other words, comprehensive treatment means caring for
the entire family. Comprehensive treatment also means long-term
care that extends from 12 to 24 months, rather than ``drive
by'' treatment programs that drop patients after only a few
weeks or months. And comprehensive care also means including
mental health services as a key component in the recovery
process.
There is evidence that substance abuse treatment improves
children's futures by healing families. In 1995, the Center for
Substance Abuse Treatment published findings from a study of
its grants administered through its Women and Children's
Branch. They found the following: \3\
---------------------------------------------------------------------------
\3\ See Center for Substance Abuse Treatment, 50 Strategies for
Substance Abuse Treatment (1997).
---------------------------------------------------------------------------
75 percent of the mothers who completed their
treatment programs remained drug free; and
40 percent terminated or reduced their receipt of
welfare.
Of the mothers' children in treatment:
65 percent were returned from foster care; and
84 percent who participated in treatment with
their parents improved their school performance.
We need look no further than our own back yard for a
compelling example of how real, comprehensive mental health and
substance abuse treatment for families works and keeps families
together. In Anacostia, the Center for Mental Health is an 18-
month substance abuse treatment program for mothers and their
children that focuses on the integration of treatment and
mental health services. The Center was started in 1989 with a
$2.8 million grant from the Center for Substance Abuse
Prevention's Pregnant Postpartum Women and Infants program and
is a true success story: \4\
---------------------------------------------------------------------------
\4\ Center for Mental Health, Fact Sheet on Outcomes for Parents
and Children. For more information, please contact Dr. Johanna Fuhrman
at 202-889-5255.
---------------------------------------------------------------------------
Of the mothers who stay in treatment for the
initial three months, 90 percent of them successfully graduate
from the program;
All graduates of the Center for Mental Health exit
the program with placements in job training or are employed in
financially stable jobs;
87 percent of the children of the mothers in
treatment have been reunified with their parents (7 out of 8);
and
100 percent of the children have made progress in
overcoming developmental delays.
In addition to this program, many Catholic Charities
agencies have begun to establish treatment programs that treat
the entire family and address both substance abuse and mental
health needs. We need to devote more Federal dollars to
encourage the development of programs like this across the
country. We also need to make changes in Medicaid and in our
Federal alcohol and substance abuse treatment programs to
encourage States to develop common payment methodologies and
program requirements in order to make this comprehensive
treatment possible. If we devote time and resources to this
issue, I am confident that we will see the effects in
improvements in our child welfare systems and outcomes for
children.
I also would like to mention a related bill introduced in
this Congress that deserves your support. Senators Olympia
Snowe, John D. Rockefeller IV, Mike DeWine and Christopher Dodd
have introduced a bill that would provide additional resources
for families in crisis. S. 2435, the Child Welfare/Alcohol and
Drug Partnership Act of 2000, would authorize $1.9 billion in
grants to the States over five years to address the connection
between substance abuse and child welfare. We have recommended
that the bill also provide incentives for States to link child
welfare, substance abuse treatment and mental health treatment
agencies. Our concern is that, without Federal incentives,
States are unlikely to develop comprehensive, integrated
family-based treatment programs at any time in the near future.
We hope the subcommittee will consider proposals to provide new
funds to the States for family-centered substance abuse and
mental health treatment.
Finally, we must acknowledge that we will not see dramatic
improvements in outcomes for children and families until we
address the range of problems faced by poor families--problems
such as lack of affordable housing, lack of reliable and
affordable child care, and insufficient resources for respite
care and other family support services. A homeless family that
cannot move out of a shelter because there is no affordable
permanent housing for them will never be stable, no matter what
improvements we make to the child welfare system. I recognize
that matters like increasing the supply of affordable permanent
housing are beyond the jurisdiction of this subcommittee. But
there must be some way that the Federal government can
encourage States to help families in the child welfare system
access the support services they need to provide for their
children. Catholic Charities USA looks forward to working with
this subcommittee, and with other relevant subcommittees, to
enact a comprehensive package of reforms which will truly make
a difference for the most vulnerable members of our population,
our children.
Thank you for the opportunity to speak with you this
morning. I would be happy to answer any questions you might
have.
Chairman Johnson. Thank you. Mr. Geen?
STATEMENT OF ROBERT GEEN, SENIOR RESEARCH ASSOCIATE, URBAN
INSTITUTE
Mr. Geen. Madam Chair, members of the subcommittee, thank
you for the opportunity to testify this morning. I would like
to make three points this morning about the need for greater
funding flexibility and content of the bill that is before the
subcommittee.
First, the existing Federal funding structure for child
welfare stifles innovation. Greater funding flexibility will
allow States to experiment with new service delivery approaches
that are more in line with the child welfare goals of improved
child well-being, child safety, and timely permanency.
Second, providing States with greater funding flexibility,
just not diminish the need for additional funding for child
welfare services.
And third, while addressing current problems in the
existing financial incentives, the proposed flexible funding
legislation itself creates unintended and undesired financial
incentives for States.
Let us start by looking at what are the limitations of the
existing financing structure. As has been mentioned by several
people, Federal child welfare funds are disproportionately
allocated for foster care with relatively little Federal
funding available for prevention. But the imbalance is even
greater than the difference between Title 4(e) and Title 4(b).
Based on the results of a recent Urban Institute survey, in
State fiscal year 1998, the States expended $707 million in
Federal funds for prevention compared to $4.5 billion in foster
care. But with their own State funds, they spent $3.8 billion
on foster care, only $609 million on prevention services.
With a cap on Federal funds for prevention and an open-
ended entitlement for placement, many researchers and advocates
have noted that States have little financial incentive to
reinforce the child welfare goals of keeping families together
and ensuring timing permanency of children removed from their
homes.
In practice, however, I have seen no evidence to suggest
that worker decisions are influenced by whether a child that
needs to be placed in foster care or needs to be unified is
4(a) eligible. Rather, I think the research suggests that the
more fundamental problem is that given the limited Federal
funding for prevention, many child welfare agencies have
developed few alternatives to foster care. States appear
reluctant to put forth their own funds on the hope that they
might reduce foster care placements and costs in the long run,
since States do not get to retain the Federal funds that are
saved. In other words, the current financing structure
reinforces the status quo and limits the innovation that States
can do.
Will flexible funding lead to better outcomes for children
and families? We do not know. The ability of flexible funding
to lead to better outcomes is predicated on the answer to two
questions. One, are there children in foster care who do not
need to be? Certainly, child welfare officials and advocates
think so, and it is true that many child welfare agencies have
minimal placement prevention, reunification, and after-care
services.
There is also testimonial evidence from workers that they
currently place children in foster care that they would not
have had services been available to safely maintain them in
their own homes. However, there is limited and very mixed
research evidence on the success of interventions to prevent
placement, speed up permanency, and avoid recurrence of foster
care. This may be due to the fact that innovative programs are
often limited in scope, given the minimal resources available
for such services.
The second question is, can child welfare workers correctly
identify those children and families that can benefit from
prevention services? Research on the effectiveness of existing
risk assessment tools and instruments is also limited and
mixed. Moreover, research to date has focused on the ability to
assess risk if no intervention is offered rather than a
specific intervention that might be implemented.
The lack of documented success of existing prevention
programs or risk assessment does not negate the need for
flexible funding. Indeed, if the child welfare is ever going to
move forward and determine what types of interventions work,
agencies need the flexibility to fund and test different
program models. The proposed legislation does include funding
for research that should help ensure that we document the
lessons learned from these demonstrations.
Does flexible funding diminish the need for additional
funds? No. There is abundant evidence that the existing
capacity of child welfare agencies is insufficient to meet the
demands placed on them. For example, caseload sizes in almost
all child welfare agencies exceed professional standards, in
many agencies by 100 percent or more. In recent case studies
done by the Urban Institute, many child welfare officials noted
that insufficient capacity has led their agencies to turn away
families they would have served in the past.
Without additional funds, many States may be unwilling to
take the financial risks associated with attempting to reduce
foster care. Consider the fact that many States are currently
using significant amounts of flexible funds, such as Title
4(b), social services block grant, and TANF to cover foster
care expenses in addition to prevention.
H.R. 5292 would go a long way toward addressing the
problems caused by inflexibility of the existing Federal child
welfare financing structure. However, while the bill addresses
some of the current problems in existing financial incentives,
it may provide States with some new and different undesired
financial incentives, and I want to mention a couple.
The bill provides an incentive for States to reduce their
foster care caseloads but not necessarily by investing more in
prevention services. For example, if a State receives a block
grant for foster care but an open-ended entitlement for
adoption, the State might have the financial incentive to make
adoptive placements before making reasonable efforts to reunify
children.
Similarly, the bill could negatively affect kinship foster
parents as many States will have a financial incentive to get
them off their foster care caseloads, reimbursing them instead
with TANF rather than foster care, as foster care payments are
much higher.
In addition, States may simply have an incentive to apply
for the demonstrations so that they do not have to be burdened
by applying the income requirements required under 4(e)
eligibility determination. As Mr. Waldman mentioned, the bill
could go further by eliminating the income determination for
all States rather than just permitting this for the five States
that are selected for demonstration. Thank you.
[The prepared statement follows:]
Statement of Robert Geen, Senior Research Associate, Urban Institute
Madam Chair, members of the Subcommittee, thank you for
this opportunity to discuss with you some of the issues raised
by the ``Flexible Funding for Child Protection Act of 2000.''
I am Robert Geen, a senior research associate at the Urban
Institute, where my research focuses on child welfare issues.
Based on our past four years of research on child welfare
financing, I would like to make three points about the need for
greater funding flexibility and the content of the bill that is
before this Subcommittee.
First: The existing Federal financing structure
for child welfare services stifles innovation. Greater funding
flexibility will allow States to experiment with new service
delivery approaches that are more in line with the child
welfare goals of improved child well-being, child safety, and
timely permanency.
Second: Providing States with greater funding
flexibility does not diminish the need for additional funding
for child welfare services.
Third: While addressing current problems in
existing financial incentives, the proposed flexible funding
legislation may create new unintended and undesired financial
incentives for States.
What limitations of the existing financing structure can
flexible funding address?
Federal child welfare funds are disproportionately
allocated for foster care. Relatively little Federal funds are
available for preventive services including services to prevent
child abuse and neglect, services to prevent foster care
placement, and services to prevent recurrence of abuse and
neglect. But the imbalance is even greater than the differences
between title IV-E (which supports foster care) and title IV-B
funding (which supports prevention). Based on the results of a
recent Urban Institute survey, in State Fiscal Year (SFY) 1998,
States expended approximately $707 million in Federal funds for
preventive services compared to $4.5 billion on foster care.
Moreover, States spent $3.8 billion of their own money on
foster care but only $609 million on preventive services.
With a cap on Federal funds for prevention and an open
ended entitlement on placement expenses, many researchers and
advocates have noted that States have little financial
incentive to reinforce the child welfare goals of keeping
families together and ensuring timely permanency of children
removed from their homes. In practice, however, I have seen no
evidence to suggest that worker decisions on whether to place a
child in foster care or whether to reunify a family are
influenced by whether the child in question is IV-E eligible.
Rather, research suggests that the more fundamental problem
is that given the limited Federal funding for prevention, many
child welfare agencies have developed few alternatives to
foster care. States appear to be reluctant to put forth their
own funds on the hope that they will reduce foster care
placements and costs in the long-run, since States do not get
to retain the Federal foster care dollars that are saved. In
other words, the current financing structure reinforces the
status quo and limits innovation. For example, assume that a
State estimates that it will cost $10,000 for it to maintain a
child in foster care, but that the State could prevent the
placement if it spent $8,000 on intensive services. If the
child is IV-E eligible and the State's Federal matching rate is
50 percent, than the cost of the foster care placement to the
State would be $5,000. Thus, to prevent the foster care
placement, the State would need to invest an additional $3,000.
Will flexible funding lead to better outcomes for children and
families?
We do not know if flexible funding will lead to better
outcomes for children and families. The ability of flexible
funding to lead to better outcomes for children and families is
predicated on the answers to two questions:
1. Are there children in foster care who do not need to be,
i.e., are their children that could have avoided placement or
that could return home if additional services were available,
or could additional services prevent recurrence of foster care
placement?
Certainly child welfare officials and advocates think so,
and it is true that many child welfare agencies have minimal
placement prevention, reunification, and aftercare services.
There is also testimonial evidence from workers that they
currently place children in foster care who they would not
have, had services been available to safely maintain them in
their own homes. However, there is limited and mixed research
evidence on the success of interventions to prevent placement,
speed up permanency, and avoid recurrence.\1\ This may be due
to the fact that innovative programs are often limited in scope
given the minimal resources available for such services.
---------------------------------------------------------------------------
\1\ See, for example, ``Gomby, D., Culross, P., and Behrman, R.
``Home Visiting: Recent Program Evaluations--Analysis and
Recommendations,'' The Future of Children, Sping/summer (1999);
Schuerman, J., Rzepnicki, T. & Littell, J. Putting families first: An
experiment in family preservation. New York: Aldine de Gruyter (1994);
Rossi, P. ``Reviewing progress in assessing the impact of family
preservation services.'' Children and Youth Services Review, 16, 453-
457 (1994); Littell, J. and Schuerman, J. A Synthesis of Research on
Family Preservation and Family Reunification Programs. Office of the
Assistant Secretary for Planning and Evaluation Department of Health
and Human Services. (1995).
---------------------------------------------------------------------------
2. Can child welfare workers correctly identify those
children and families that can benefit from placement
prevention, reunification, and/or aftercare services?
Research on the effectiveness of existing risk assessment
tools and instruments is also limited and mixed.\2\ Moreover,
research to date has focused on our ability to assess risk to a
child if no intervention is offered rather than assessing risk
given a specific intervention.
---------------------------------------------------------------------------
\2\ See, for example, Wald, Michael S. and Woolverton, Maria.
``Risk Assessment: The Emperor's New Cloths?'' Child Welfare 69; 483-
511 (1990).
---------------------------------------------------------------------------
The lack of documented success of existing prevention
programs or risk assessment does not negate the need for
flexible funding. Indeed, if the child welfare community is
ever going to determine the types of interventions that work,
agencies need the flexibility to fund and test different
program models. The proposed legislation does include funding
for research that should help ensure that we document lessons
learned from the demonstrations.
Does flexible funding diminish the need for additional funds?
Flexible funding does not diminish the need for additional
funds. There is abundant evidence that the existing capacity of
child welfare agencies is insufficient to meet the demands
placed on them. For example, caseload sizes in almost all child
welfare agencies exceed professional standards, in many
agencies by 100 percent of more.\3\ In recent case studies of
State child welfare agencies conducted by the Urban Institute,
many administrators reported that insufficient capacity has led
their agencies to turn away families they would have served in
the past.
---------------------------------------------------------------------------
\3\ Petit, M. and Curtis, P. Child Abuse and Neglect: A Look at the
States. Child Welfare League of America, CWLA Press: Washington, DC
(1997).
---------------------------------------------------------------------------
Without additional funds, many States will be unwilling to
take the financial risks associated with attempting to reduce
foster care caseloads. Consider the fact that many States are
currently using significant amount of flexible funds such as
title IV-B, Social Services Block Grant (SSBG), and Temporary
Assistance for Needy Families (TANF) to cover foster care
expenses. In SFY 1998, States expended approximately $87
million of IV-B funds, $356 million from SSBG, and $124 million
from TANF for foster care, and $161 million, $298 million, and
$59 million on prevention respectively.
HR 5292 would go a long way toward addressing the problems
caused by the inflexibility of the existing Federal child
welfare financing structure. However, while the bill addresses
some of the current problems in existing financial incentives,
it may provide States with some new and different undesired
financial incentives.
The bill provides an incentive for States to
reduce their foster care caseloads, but not necessarily by
investing more in preventive services. For example, if a State
receives a block grant for foster care funds but retains the
open-ended entitlement for adoption assistance, the State may
have a financial incentive to make adoptive placements before
making reasonable efforts to reunify children with their
families. Similarly, the bill could negatively affect kinship
foster parents, as States may have a financial incentive to
move them off their caseloads and support them with TANF rather
than foster care payments which are considerably higher.
In addition, States may have an incentive to apply
for a demonstration, not to use funds more flexibly, but simply
to be relieved of the burden of applying income requirements in
determining IV-E eligibility. The bill could eliminate the
income determination for all States rather than just permitting
this for the 5 States that are selected for demonstrations.
Thank you again for this opportunity to testify and I am
happy to answer any questions you may have.
The views expressed are those of the author and do not
necessarily reflect those of the Urban Institute, its trustees,
or its sponsors.
Chairman Johnson. Thank you very much, Mr. Geen. Ms.
Kearney?
STATEMENT OF HON. KATHLEEN A. KEARNEY, SECRETARY, FLORIDA
DEPARTMENT OF CHILDREN AND FAMILIES
Ms. Kearney. Good morning. It is so nice to see all of you
again. I am Judge Kathleen Kearney, the Secretary of the
Florida Department of Children and Families. I would like today
to urge you to pass at least the waiver portion of H.R. 5292. I
feel that it is critical. I would like to today address my
remarks predominately to the waiver aspect of the legislation
that you have pending and I will tell you why I think it is
absolutely critical. I do not think kids can wait at this time
any further.
What I would like to do is basically point you to the
legislation and in my written testimony you will see this
written on page five, the issues pertaining predominately to
the waiver. What this legislation will do at the front lines is
critical. First, it will replace the current tightly controlled
experimental design requirements with less rigid evaluation
methods that nonetheless will still hold States accountable,
which is critical. Obviously, I think it is very important that
we manage by data, but right now, under the current waivers,
what goes with that is such a strong administrative burden that
many States are contemplating whether or not the waivers are
even worth it. So I think it is important that this legislation
advance that cause.
Additionally, this legislation is designed to streamline
the application process for the waivers. Florida first applied
for a waiver in April of 1998. We did not hear from the
administration until July of 1999, and by then, the
implementation of ASFA in Florida had taken place and it
required a complete change to the waiver. We had to go back to
ground zero. Under this current legislation, it envisions that
that would not take place, that you could resubmit immediately
and you would not lose any time. We are still to this day now
waiting for approval to implement the amended waiver. It has
now been two-and-a-half years and our waiver has not yet been
put on the streets.
This legislation also will allow States to broaden the size
and the scope of their waivers. It will extend the waivers
beyond 2002, particularly for those programs that are
successful. To terminate them right now would not be
appropriate. It also will eliminate restrictions on replicating
all features of waivers that are found in other States and
eliminate the number requirement, which I believe Mr. Waldman
also spoke about. This is absolutely critical.
Right now in the State of Florida, we have a Clark
Foundation grant in Jacksonville that deals with prevention. If
I was able to successfully get another waiver, I could expand
that program and I believe it would be highly successful. I
would also seek a waiver in order to replicate what the State
of Illinois is currently doing with their guardianship waiver.
That is so needed at this moment, this very moment, in Miami,
where so many children are placed with relatives and we
desperately need that flexibility.
Also, I believe that if you allow the expansion at this
time of the waiver portion, it will lead to a gateway for
further flexibility. I understand the concerns that have been
expressed here today. You will see in my written testimony some
concerns about the maintenance of effort requirement. While I
believe that States do need to put in their fair share, there
are concerns about the fact that States will bear the cost of
that inflation. So I think that is a critical issue that you
should look at.
But I would strongly urge this subcommittee to look at
passing this year the waiver requirement. Kids cannot wait. I
say that very mindful that one of my colleagues on the court in
Gainesville has asked me to personally review a case of a child
who has been in foster care and is about ready to age out at
18. She has been in foster care for five years. She has been in
some incredibly therapeutic placements that did her no good.
She has been in regular foster care. And right now, the court
is very concerned that she will have no place to go on her 18th
birthday but the adult mental health system and we have done
her no service.
As I speak here today, my district administrator in Palm
Beach County is in front of a grand jury investigating two
deaths in Palm Beach County, two deaths that, frankly, could
have been prevented had monies been put in the front end of the
system to prevent child abuse and, frankly, to have that child
be maintained safely in an intact family, and also address the
mental health and substance abuse issues of that family. That
did not occur and these children are dead.
So I encourage you strongly to please look at the waiver
requirement this year. Kids cannot wait. Thank you.
[The prepared statement follows:]
Statement of Hon. Kathleen A. Kearney, Secretary, Florida Department of
Children and Families
Good morning Madam Chair and members of the Human Resources
Subcommittee. My name is Judge Kathleen A. Kearney and I am the
Secretary of the Florida Department of Children and Families.
Thank you for inviting me to once again address the
Subcommittee on an issue of utmost importance -protecting our
Nation's children from abuse and neglect. I want to applaud
you, Madam Chairman, for your leadership and steadfast
commitment to developing legislation that will benefit the
children and families served by the child welfare system. Since
I have only recently seen the final version of H.R. 5292 and I
have not completed a thorough review and analysis, I will speak
only in the broadest terms with respect to the legislation.
After seeing the child welfare system both as a judge and
as Secretary in Florida, I have reached several conclusions.
First, the current system of child welfare financing is broken
and does not support the outcomes for children and families
that are embodied in Federal and State statute nor does it
model social work ``best practices.'' Second, States need
greater flexibility over available resources to make needed
improvements. Third, the magnitude of the crisis we face
everyday, requires a bold solution with a broad base of
support. And, finally, the Title IV-E waiver program could be
modified to provide much needed relief to States while
maintaining an essential entitlement. I realize modifying
demonstration waivers will not end the discussion about the
need for greater reform but it is a step that will support
States in significant ways.
Under Florida's legislative mandate to transition to
community-based care by January 1, 2003, the Department of
Children and Families is committed to working in partnership
with local communities to ensure safety, well-being and self-
sufficiency for the people we serve. We share a common vision
for our child protection system:
The safety of children at all times will be a
foremost concern, and permanency resolution in accordance with
a child's sense of time will be the system's standard;
Services will be provided by comprehensive,
community-based networks of providers who are equipped to
manage and deliver all needed services to meet the needs of
child abuse and neglect victims and at-risk children and their
families;
Resources will be efficiently and effectively
managed to achieve better outcomes for children, with the
ultimate goal being child safety and permanency within a
twelve-month timeframe;
Services will be coordinated across systems to
maximize limited resources and ensure a single, unified case
plan, managed by a primary case manager;
Financial support will be available from diverse
Federal, State, and local sources, flexibly managed at the
local level, to meet child and family needs;
There will be financial incentives to stimulate
continuous improvement in child safety and permanency outcomes;
and
The system will be able to collect and use data to
accurately forecast what services and supports are needed, at
what level of intensity and duration, and at what cost, to
achieve desired outcomes for each child and family in need.
My State is taking steps to realize this vision. Just over
a year ago, Florida was granted a Title IV-E waiver, which we
have not yet begun to implement. I sought the waiver because I
believed it would help the State reduce the number of children
in foster care and the length of stay, reduce the use of
restrictive and costly placement settings, and reduce re-abuse
and re-entry into foster care, while stimulating much needed
innovative preventive and aftercare service options. These are
all goals that I know you support.
The waiver will help my State achieve these goals in part,
by allowing greater flexibility and financial incentives that
are better aligned with program goals. Instead of spending a
disproportionate share of Federal resources to fund the deepest
and least desirable part of the system--out of home care--the
State and local community-based agencies will use their
resources differently to test innovative ways to both protect
children and preserve families.
I still believe the Title IV-E waiver can greatly help
Florida transition to a more effective community-based care
system and achieve the vision. However, there are obstacles
that need to be addressed. To ensure that improvement and
innovation are sustained and expanded under the waiver in
Florida and in other States, we must remove barriers to optimal
performance. Many of the problems with the existing waiver
program are being addressed in H.R. 5292.
The child welfare waivers proposed in this bill present
several opportunities that would help States make needed
improvements in their child protection systems. I strongly
support the Title IV-E waiver modifications proposed in the
legislation that will:
1. Replace the tightly controlled experimental design
requirements with less rigid evaluation methods that will
nonetheless hold States accountable.
2. Streamline the application process and allow States to
modify and expand waivers during the demonstration.
3. Allow States to broaden the size and scope of their
waivers.
4. Expand the program application period beyond 2002.
5. Eliminate restrictions on replicating all features of
waivers found in other States; and eliminate limits on how many
waivers a State may have.
6. Allow the waivers to be a gateway to continuing
flexibility.
Once a State has demonstrated improved outcomes and a cost-
effective, cost neutral model, the State should not be required
to return to business as usual after the waiver demonstration
period ends. Instead the State should be allowed to retain the
flexibility and expand the program. Given the significant
diversity of our State, we would take advantage of implementing
different initiatives depending on the unique assets of the
communities involved.
Florida currently has a multiyear grant from the Edna
McConnell Clark Foundation that involves numerous community-
based strategies to better serve children and families. This
initiative, currently well developed in Jacksonville, is
designed to keep children from ever being abused the first
time. Jacksonville would benefit from a demonstration waiver
that would provide greater incentives for reinvesting savings
in prevention efforts.
In other areas of Florida, most notably in Miami, there are
many children in out of home care that are placed with
relatives. In these areas, a guardianship waiver would
significantly enhance the permanency options for these
children. A stable, permanent relationship in these foster care
cases cannot be established with current the Federal funding
requirements. The relative guardianship waiver, which has been
highly successful in Illinois, cannot be replicated in Florida
under the current Federal regulations. The amendments set forth
in H.R. 5292 would allow Florida and other States to apply for
and replicate the Illinois waiver.
Streamlining the current process for obtaining a waiver is
critical. A waiver application and implementation under the
current system is a challenging and lengthy undertaking for a
State. The process at the Federal level for approving proposals
and subsequent implementation plans must be streamlined. For
example, Florida first applied for a waiver in April of 1998,
and by July 1999 had not received notification of either an
acceptance or rejection from the US Department of Health and
Human Services. By that time, the passage of the Federal
Adoption and Safe Families Act and subsequent major State
legislative changes creating a community-based care system of
child protection, resulted in the need to withdraw and rewrite
the pending application. Had multiple waiver options been
available, Florida could have simply requested another waiver.
Under current rules Florida had to decide which waiver was the
most critical to the State, so the first waiver was withdrawn
and a second waiver written. Even now, with this new waiver
written and approved by the Department of Health and Human
Services on September 29, 1999, Florida still does not have
approval on an implementation plan submitted in May 2000. It
has been over two and one-half years since our original
submission and we have not been able to implement necessary
changes.
In addition to these modifications, which would greatly
enhance the waiver potential in Florida, I urge you to expand
your efforts to help reduce the cumbersome and difficult to
manage rules and regulations. States and providers operating
under Title IV-E waivers still must contend with Federal
eligibility rules and reporting requirements that are
redundant, costly, and difficult to manage. The problem becomes
even more acute when States try to ``blend'' or pool funds
across multiple funding streams. The magnitude of paperwork
required for eligibility and encounter reporting--in the
absence of sophisticated technology-limits access to needed
services. The result is higher administrative costs and fewer
resources available to invest in service improvements or
expansion. In my State, I am told it will be even more
cumbersome to administer the Title IV-E waiver than it is to
manage without the waiver. Surely, this was not the intent.
Finally, I believe the Title IV-E modifications should also
address some of the problems you address in the Flexible
Funding Demonstration section of the bill. I realize that the
current bill addresses some of the recommendations related to
transferability and de-linking in the flexible funding
demonstration. However, instead of limiting this option to the
five States that elect to participate in the flexible funding
demonstrations, it would be helpful if these issues could also
be addressed under the modification of Title IV-E waiver. All
States need relief from the inordinate amounts of time and
money required just to determine eligibility for Federal
reimbursement. And, all States should be rewarded and not
penalized when their efforts result in improved outcomes for
children and families. All States should have the opportunity
to re-invest savings from Title IV-E into their Title IV-B
programs when their innovations result in reductions in foster
care.
The section of the proposed legislation related to
consolidation of grants includes a maintenance of effort
requirement. While it is reasonable for Congress to expect
States to maintain support for child welfare programs, the
proposal, as currently written, is going to make it very
difficult for States to support the bill for two reasons.
First, the bill requires States to be responsible for
maintaining historic levels of State, Federal and local funding
in child welfare services. Secondly, the proposed bill
increases the requirement by an adjustment for inflation that
occurs after 1998. This means that if a Federal funding source
fails to keep pace with inflation, the State would be
responsible for making up the difference. Similarly, if a local
funding source either reduces funding or fails to keep pace
with inflation, the State would be responsible for the gap.
States will be very reluctant to accept responsibility for
factors that are beyond their control. While there is an
adjustment for reductions in Federal funding, these adjustments
are not adjusted for inflation. The current proposal would make
the State responsible for the impact of inflation on Federal
funds, even if the Federal funding source was reduced.
It would be extremely unfortunate for States to decide not
to pursue the flexibility offered by the proposed legislation
due to the unacceptable risk posed by the maintenance of effort
requirement. I would urge you to revise the requirement to
remove Federal and local funds from the calculation and to
remove the inflation adjustment from consideration.
In the section of the proposed bill related to transfer of
funds, the maintenance of effort provision does not appear to
have some of the features that are mentioned above. It would be
a positive move to avoid placing States in a position where
they would fail to take advantage of opportunities to improve
service delivery through more flexible use of funds because of
maintenance of effort provisions that impose unacceptable
financial risks.
In closing, I support the Title IV-E demonstration waiver
modifications and believe the waiver model offers the best
opportunity for Congress and the States to test and prove the
best ways to fund the child protection system. I believe that
success will be even more likely when Federal funding supports
and encourages the development of a child welfare system based
on community specific, State specific child and family needs.
Thank you for your continued efforts to protect our country's
most precious resource--our children.
Chairman Johnson. Before we go on to questions, I would
like to put two comments squarely in the record. First of all,
I do not believe there is anyone on this committee that does
not believe we do not need more money for these kids, period.
That is not the issue here.
Secondly, Ms. Daly, I was elected in 1982. In 1983, I went
to every child care facility in my State, every community
mental health center in my State, and all of them said 80
percent of the families have substance abuse problems. We have
known that. Nobody has done anything about that, so I cannot
let that stand in the way. Do not tell me to tighten up the
existing system to take care of that. Nobody will do it. I
cannot get it to happen.
I was here when we did welfare reform the first time. It
failed because we did not give them day care money. The new
reform succeeded because we gave them flexible money and they
could use it on day care if they needed it.
So I really was disheartened by your testimony. You know,
what Connecticut is doing using flexibility is really--if your
people at Catholic Family Charities in Connecticut do not know
it, they should. Those safe homes where they take four or five
kids who are in a household at risk and put them in a safe home
instead of breaking them all up and placing them here and
there. So for a month or two or maybe even three, they can
treat the whole family and see, can they reunify this family?
Can they find a foster care for all the family? Can they do
kinship? It is not covered by our system. Those are not
placement dollars.
Talk to the people at Yale. Do your people not talk to the
people at Yale who have done a phenomenal job of reducing the
length of stay in the psychiatric ward in the Children's
Hospital of Yale from six months--imagine the reunification
problems after six months of separation with that severely ill
a child--to two months by supporting the whole family and the
child and working through this.
I just want you to know, I am absolutely not interested and
will not be a part of just pouring money into the current
system because the current system does not work and we cannot
reach all those people beyond the 28 percent that Wendell
pointed to.
Now, one other thing I want to put on the record. This
maintenance of effort issue has begun to take a very different
nature in my mind and that results from my work on TANF. My
State was criticized for substitution. When you got into the
issue, what they were doing was trying to eliminate the
difference between women with exactly the same family and
income circumstances, the only difference being whether they
had been on welfare or had not been on welfare. The ones that
had not been on welfare had simply struggled and struggled on
their own or sometimes with better family supports.
But maintenance of effort does tie in old lines, and if we
want an integrated system of services to support all struggling
families, all poor single parents gaining their independence,
we cannot stay with this old fashioned, unenlightened policy of
maintenance of effort down old lines, and this is going to be
for me a major issue in welfare reform because my State was
right. They moved into a system that said, if you are in the
same circumstances, honey, just because you did not go on
welfare, we are still going to give you the same help.
That is what we are trying to do in fatherhood. We are
trying to branch out beyond mothers on welfare to the fathers
of the children on welfare, and then we are going to have to
branch out to the fathers of poor children not on welfare. And
in foster care, we have got to reach the families that are
having trouble but have not reached the Federal definition of
at risk.
So I am not building a system to improve what we are doing
now because it is not adequate. I am trying to build a system
that looks more holistically and far earlier and looks at how
can we prevent families from ever getting to the point that
they are getting to now. If we do not look bigger and broader,
we cannot do that. If we focus now on MOEs for this narrow
thing, that is just lunacy.
So we have got to look bigger and maybe the best thing to
do is to move ahead. I will be very interested and I hope the
members of my subcommittee, including Ben, will comment on
whether or not there would be bipartisan support for just
moving ahead with the waiver part of this bill because I
absolutely agree with Judge Kearney. These children cannot
wait, and we are ``helping'' much too narrow a spectrum of the
kids who need help. If we wait to treat substance abuse until
the kids are beaten, what kind of society is that?
I am disheartened by your rather backward-looking approach,
in my estimation, to change and want to look far bigger than
that. I appreciate some of the comments that have been made
here about looking bigger than that. I would also urge people
with Wendell's experience to really look beyond maintenance of
effort. It is such a limited concept and it will build us the
wrong system.
Ms. Daly. Mrs. Johnson, may I respond?
Chairman Johnson. You certainly may.
Ms. Daly. Your interest in these issues is very well known
in Connecticut as well as in the subcommittee. What I am
arguing is not that we should not invest at the beginning of
the system. Of course we should. Of course we need more
prevention. What I am afraid of is that the children who are
already abused and neglected, who are already taken out of
their parents' care or in foster care will get worse and worse
care and some children who ought to be--
Chairman Johnson. What do you base that assumption on?
Ms. Daly. Because the States will be taking some of their
money that would otherwise go into foster care maintenance,
which I believe is underfunded now, and will transfer that
money into prevention. That is a Sophie's choice. We should be
doing both.
Chairman Johnson. I do not see that.
Ms. Daly. We should be reforming both systems. You are
assuming that there cannot be any additional Federal money
under this program going into these systems.
Chairman Johnson. I am not assuming that. I made that point
earlier. I am not assuming that. I am separating the issues.
Ms. Daly. But you are trying to transfer foster care
maintenance money over into prevention by allowing States to do
that, which means inevitably they will be spending less money
on the children who need foster care.
Chairman Johnson. No, no. It only means that if they have
less children going into foster care, they will have more money
for earlier treatment. It does not mean that once the kid is in
foster care you will reduce the payment. I do not want to
belabor this, but I will forego my questions since I have taken
the time to make comments.
Ben?
Mr. Cardin. Thank you, Madam Chair. Here is the dilemma. We
all agree the States should have more flexibility. We all agree
there is a need for more resources to be put into the program
and there needs to be accountability. We also are not putting
enough money into prevention and certainly not enough money
into substance abuse for families at risk.
The problem is, and this is the point that Ms. Daly made
that I happen to agree with, is that if you look at the history
of Title XX, which was a block grant to the States that gives
them flexible monies that they can use for these purposes, they
actually use the money for preventive services. Now, what has
happened? In 1996, it was $2.8 billion. Today, it is $1.7
billion.
The problem that I see historically, if you look at
Congress over its history, flexibility has usually been
followed with reduced funding, not more funding, because there
is not the specific responsibility of the Federal Government to
ensure certain outcomes. I am very concerned about that fact--
and I know Mrs. Johnson absolutely supports more funds in this
area. We joined together on the Title XX issue. I understand
that.
The problem is that the people who make decisions on the
dollar amounts are not always the same people who have
responsibility for creating the authorization bills. We then
get into a budget debate late in the session, quite frankly,
children's issues do not fare as well as some of the other
issues late in the session. Unless there is a specific
obligation at the Federal level, historically, we have found
under both Democratic and Republican administrations and
Congresses, the funds have been diminished, and that is what, I
guess, concerned me as we go down this path as to how we get
more money into these programs that everyone acknowledges is
needed--and more flexibility into the program. How do we do
both and maintain the Federal Government's standards for
accountability to the States to achieve not just caring for
children who already have been damaged but to prevent more
children from being put at risk.
I think, Mrs. Johnson, that we could work out an agreement
on the waiver issue. The waiver issue, I happen to agree with
the provisions in the bill and it is possible that we could try
to come to grips with that section and move that forward.
Let me just caution, as you know, we are in the last ten
days of this session--actually, the last two days, but I think
it is going to be the last ten days of the session because we
are doing another CR until next weekend--and although we can
clear our calendar here, the Senate has a difficulty clearing
its calendar even for naming a post office today, so it is
going to be tough to figure out how we are going to get bills
through the other body.
And then lastly, let me point out, Mrs. Johnson's
legislation, as I understand it, has been scored by CBO as
additional outlays. The reason, as I understand it, CBO assumes
that because of the baseline calculations, States will pick
what is most advantageous to them and, therefore, will come out
somewhat ahead as a result of the additional flexibility.
My point is very simple. If we have the additional
resources--I think it is close to half-a-billion dollars as it
has been scored--let us put that into the system. Maybe we
could work out before the end of this session the flexibility
on the waivers to the States and some additional resources into
the program. We accomplish the goal that Mrs. Johnson has put
forward rather persuasively, that the States need additional
flexibility and they also need additional funds but that the
current system needs to be changed. Well, the best way to
change it is to let the States go forward with demonstration
under their waiver. They do not need a new demonstration
authority. They can use the waiver authority to come forward
with new programs in this area.
I guess my question to the panel, and in the time that
remains I will be glad to let any of you respond to it, is how
do we get more money into the system? How do we do this, with
the concerns that Mrs. Johnson has raised, with the needs that
you know are out there? Yes, we need the money in the children
who are already placed in foster care, but we also want to put
more money into prevention and I really want to get some more
money into substance abuse. How do we go about doing it? What
are your strategies? How do we maintain Federal accountability
with flexibility to the States, in 30 seconds?
[Laughter.]
Mr. Cardin. Yes?
Mr. Waldman. Congressman, I do not know if I can do it in
30 seconds, but I do want to different a key point you made,
just with some observations about how funding cuts follow
flexibility.
I think there are some other elements at play. I think in
the SSBG, which I commend both of you for supporting, there
were not defined outcomes. We have defined outcomes now that I
think we could rally around. If we could couple the flexibility
with improvements in safety and permanency outcomes, I think
that will make a difference. And I agree with you. Without
those, the program gets very vulnerable, what happened to
revenue sharing, SSBG, and others. But I think those outcomes
make a world of difference.
Thirty-five years of practical experience in government.
This area does need more resources. That only comes two ways. I
think what will get the additional resources is to spend the
money better than we are doing now and get the outcomes that we
need that will generate the confidence in the public child
welfare system for legislators, governors, and others, and
Congressmen, to make additional appropriations.
Mr. Primus. Let me just comment briefly. I think the other
dilemma is that when you have an open-ended stream of funding
for services, there really is almost no limit in terms of what
States might legitimately spend on services. So the question
is, how do you minimize the risk to the Federal Government of
overspending when you have an open-ended stream of funding for
services? I do not think you have the same risk in terms of
cash payments or maintenance payments, and so I think as part
of the review, the question is, do you match it? I think a
considerable State match demands accountability from States
because then State legislators have to put up the money to get
that flexible stream of funding. You might consider overall
capped entitlements, and that does not necessarily mean an
aggregate cap. It might mean a per child or a time limit on
when services can be provided.
I do think you have to worry about the risk of an open-
ended funding stream, and really, the question is how do you
minimize that risk and still give a lot of flexibility to
States.
Mr. Cardin. You set up the issue. You have not told me the
answer yet, but--
[Laughter.]
Mr. Cardin. Thank you.
Mr. Primus. I would come down in favor of the State match.
I think that really does demand a lot of accountability because
then State legislators have to appropriate funding and I think
there is more accountability in that kind of a system than we
sometimes assume.
Chairman Johnson. I just would say that I have written the
governors to use their TANF money to focus on substance abuse
and mental health issues, because I think as we move forward
with welfare reform, we are beginning to focus on a population
where these are very big problems, and as we get those programs
better established and able to reach people on welfare, there
is a whole parallel population or side-by-side population.
Dr. Wulczyn, I know you have to leave for a plane pretty
soon. Would you like to make any additional comments?
Dr. Wulczyn. I think the issue on how we approach greater
flexibility in the context of additional money at the same
time, Mr. Waldman was exactly right that we have to focus on
outcomes. If we are not getting outcomes and we need more
money, then we have to find a way to do that.
I think it is conceivable that we look at--the big
difference now compared to where we were 20 years ago or ten
years ago is the availability of information with respect to
who is using services, who are the high-risk target
populations, and that we ought to use that information more
wisely, not simply for tracking outcomes but for also
projecting into the future where we ought to make investments.
It is conceivable to me that we could develop programs of
national interest that target certain populations of children
and that resources at the Federal level with matching at the
State level be targeted to specific groups of children, for
example, infants.
The rate of placement in foster care among children under
the age of three months is extraordinarily high. Undoubtedly,
it is higher than it is anywhere else in the world. We need
specific revenues targeting those children. They stay in care
longer than any other children admitted to foster care. They
use more resources of different kinds than any other children.
It would be useful to have a specific program at the national
level that allowed States to target those most vulnerable
children, provided that in a given State, that is the group of
children that are, in fact, most vulnerable, because it is not
always the case.
But I think having that kind of structure where States
would, in effect, apply for targeted revenues where you have
identified key target populations, target areas for some kind
of revenue sharing proposal, predicated on outcomes, reducing
the overall utilization of foster care, increasing the
availability of preventive services, that would be a productive
way to go and it would allow you to generate flexibility for
States both in terms of how they are thinking of things, but
also, I think, in terms of breaking down the way the current
funding system does create certain incentives around building a
foster care system as opposed to building a--
Chairman Johnson. Is this what you meant in your testimony
when you said, how you purchase services affects what services
you are able to develop?
Dr. Wulczyn. That is right. It is not simply a matter of
expanding the array of services that influences what is
available. It is how you allow them to be purchased. It is
something that we learned in health care over the last 25 years
and it is something that restricts the range of State
responses, is that if you purchase things on a fee-for-service
basis or per diem rates, which is the dominant method for
purchasing foster care in this country, it is hard to get out
of that when you are trying to reduce, because the level of
funding is predicated on your ability to supply a claim.
It works very well when you are increasing the utilization
of foster care for reasons of substance abuse and what have
you, but when you enter into a period where you might logically
expect the utilization of foster care to go down, then these
fee-for-service systems are constraining on State efforts and,
therefore, the means by which you are purchasing stifles
innovation.
Chairman Johnson. Thank you very much.
Does anyone else have any question of Dr. Wulczyn?
Mr. Camp. I have got some questions for the panel.
Chairman Johnson. All right. You are next in line to
question, but thank you, Dr. Wulczyn.
Congressman Camp?
Mr. Camp. Thank you, Madam Chairman. Thank you for this
hearing and thank you for your leadership on these critical
issues that are important to children.
I sort of feel like Yogi Berra. It is deja vu all over
again. I remember the debate on the Adoption and Safe Families
Act and there were so many people who wanted to hold the bill
up for more money for kinship or drugs or whatever issues and
we almost did not get the legislation because of that. Some of
those same people were the first to step forward and take
credit for the bill once it passed. But I think if we wait for
more money, we will miss the good policies that we need now,
and I know many of you have talked about the critical need in
this area and it is, I mean, when you are talking about the
difficulty that children face.
I do not think any of us would think children would be
better served if we did not pass the Adoption and Safe Families
Act and waited to try to get the funding resources in line. We
have been waiting for the administration to give a report on
the specifics, policy guidance in those areas where they wanted
more money, and we got a report but there are no specifics in
the report, so I think that we have some difficulty here.
We have worked closely with the administration to try to
ensure that Health and Human Services has enough money to pay
for these adoption bonuses, Mr. Waldman, that you mentioned in
your written testimony, and I do think this committee, we had a
significant discussion about those adoption bonuses. We
established those incentives under the Adoption and Safe
Families Act and I think we have protected those and continue
to promote those and this committee, I know that Madam Chairman
agrees and will continue to do that in the future. So I think
that is something that we all can agree on.
I am interested in pursuing the waiver portion of this
legislation as a possibility in the short few days that we have
left, but I have a specific question for Judge Kearney. Thank
you for coming again. It is good to see you. As a State
official, and we do this here too, we have to balance needs and
it is always a debate. You never get to get everything you want
and it is trade-offs and difficult.
There are kind of two important policies here, the need for
more resources and Federal dollars but also the need for
greater State flexibility. If you had to kind of choose one of
those, which I know is a difficult thing to ask you to do,
could you discuss which you would prefer and other trade-offs
in the different approaches to promoting children's safety and
permanency and well-being.
Ms. Kearney. In coming to this job from the bench, I did
not realize that in many ways it would be like the television
show ``Survivor'' as to who gets kicked off the island today.
You are right. It is a constant balancing act between competing
interests, all of which are important, all of which are
critical.
But I can tell you that now having done this job for 20
months, that to me, what is most critical right now is the
flexibility. We have had a tremendous growth in resources in
the child protection system in Florida due to the leadership of
Governor Jeb Bush, who came in and recognized a significant
need, urged the legislature to fund, and they have increased
general revenue into our system.
But it is absolutely imperative that we have the
flexibility to put the funds where they are most needed, and
right now, in an analysis of the Florida child protection
system, it is the front end of the system that is most
critically in need. We have 14,000 children in foster care in
Florida. Our definition of foster care is the State-run
traditional foster care system, not the relative placements.
Although they are under the jurisdiction of the court in
protective supervision status, they are not foster care.
But when I see how much money, the portion of the pie that
is going into the 4(e) funding, that if I had the ability to
transfer even five percent of that into a front-end portion of
the system, I know I could prevent the children coming into the
system to be able to have them in safe environments, to ensure
that ASFA is intact, and the goals of ASFA are intact.
But right now, frankly, if asked, would you like another
$500 million or would you like the flexibility to manage the
system, I think as a manager, it is key right now that we have
the flexibility, and that is why I felt it was imperative that
I come here today to specifically address what I think is
realistic for you at this moment in the political lifespan, is
to address at least the waivers to give us that flexibility.
Mr. Camp. Thank you. Thank you very much.
Chairman Johnson. Thank you. Mr. McCrery?
Mr. McCrery. This debate reminds me somewhat of the welfare
reform debate, when those of us who trusted the States to use
their money wisely and where they thought it could best be used
were criticized by people saying, oh, the States will not do
that. There must be Federal standards and guidelines and
strings attached to the money or the States will just fritter
it away and throw people in the streets. Obviously, that has
not happened and the flexibility that we gave States in TANF
has worked.
So I am a little reluctant to give in to those of you who
are cautioning us not to allow States to use money that we send
them in ways that they best see fit. I mean, what is the
problem? Why do you suspect that Judge Kearney, when she gets
that flexibility, will just waste it, fritter it away on
something--I do not know what you are talking about. Why do you
think people in the States are less able than we are here in
Washington to determine the best interests of the children? I
do not understand. I would like for you to respond. What is the
problem?
Ms. Daly. May I respond? I would like for the judge, when
she goes to her State legislature and for her State office of
management and budget to be able to say, look, we cannot do
less than this for these children who we already know are
abused and neglected and are in the system because the Federal
Government will not give us money, will not release those funds
unless we make these investments. I want to strengthen her
hand, because it is not just the judge who will make the
decisions. It is all these other people and competing interests
and there is not a strong lobby at the State level to protect
those children. They are out of sight, out of mind, and--
Mr. McCrery. Well, again--
Ms. Daly. Remember, this is a--
Mr. McCrery. Let me interrupt for just a second because I
am not satisfied with that answer.
Ms. Daly. Okay.
Mr. McCrery. There will be controls on the money. The
States will not be able to spend it on highways. They will have
to spend it on foster care in some form or fashion. So the
State legislators that you are concerned about, is there a
stronger lobby for the services aspect of this program?
Ms. Daly. Well, there is a real strong lobby for the
highways and we have seen how Medicaid money gets spent on
highways.
Mr. McCrery. You cannot use this money on highways, let me
repeat.
Ms. Daly. No, I understand, and I am not opposed to
flexibility--
Mr. McCrery. Answer my question.
Ms. Daly. Okay.
Mr. McCrery. Is there a stronger lobby in the State for the
services aspect of this program?
Ms. Daly. Well, I think that would depend on the State.
What I am afraid of--
Mr. McCrery. So the answer is no.
Ms. Daly. No, I do not think that is the question.
Mr. McCrery. So I still do not have an answer.
Ms. Daly. The question is, is there a lobby for more money?
If the State is going to have more flexibility--
Mr. McCrery. We are not talking about more money. We are
talking about flexibility.
Ms. Daly. But I think flexibility without more money in the
system is just unrealistic.
Mr. McCrery. I hear what you think, but you have not given
me a rationale for your thinking. Wendell, maybe you can shed
some light on it.
Mr. Primus. Again, I am for State flexibility. I am also
for additional funding. I would like to give the State of
Florida additional dollars. What this bill is demanding is that
to get those additional dollars, she has to cut something out
of IV-E, and in some ways, it is very much a mechanical issue
here. Do you really want for the State of Louisiana--we do not
know whether the projections of how much IV-E is really going
to cost will come true. Look at the little table I provided in
my testimony. For some States, caseloads went down and then
back up. For other States, caseloads were level and then really
exploded. Again, if you look at the history, projections are
extremely difficult to make on a State-by-State basis.
So the real question is, do you really want the amount of
money that Louisiana gets to depend upon a negotiation over
something that is basically unknowable between Federal and
State officials? I think we should give additional money much
more directly and simply and give the States with that stream
of funding more flexibility and then the Florida Secretary
could use that money to try to reduce placements. That is what
you did in ASFA. I mean, there was some additional funding, and
as a result, and with some incentives, you are now getting this
increase in adoptions.
So what I am basically arguing is that that would be a
modest step, but I think you should do a more comprehensive
review of the system. I mean, some kids are not--the other
thing about the waivers, if State after State requires a waiver
for the same thing, maybe the Federal provision should be
changed. My understanding from Bill in the little exchange of
notes is one of the primary problems is we do not take the
child out of the home. There is a grandmother, a mother that is
on drugs or is no longer capable of caring for that child, and
then the small child. But 4(e) says you cannot get money unless
the child is removed from the home. Well, that is one of the
problems and maybe in your review you ought to address that.
Mr. McCrery. That is something we can look at and that
would certainly go along with Judge Kearney's testimony.
Yes, would you like to comment?
Mr. Waldman. Just briefly, and I think I am agreeing with
your point of view. I just want to say for the record, I have
worked for three different governors as secretary of both
political parties and it did not matter which party. There was
always a high commitment to this issue and a willingness to
invest.
If I had to say what I thought was the constraint in
getting the additional revenue from governors, legislators of
both parties, and of Congress through the years, a belief that
the money might not be well spent, that good money would be
invested after bad. In my view sequentially, if we hope to get
more resources in this system, we have got to demonstrate that
we could spend them well, that there is truly return on
investment for children.
Mr. McCrery. Let me just conclude by making two points.
Number one, I am told that, in fact, we will be spending more
money if this bill passes, and number two, Wendell, if you are
concerned that there will be an uptick in the need that will
not be anticipated by the State and they will have spent their
money on other things, that might be a good way for you to get
your additional funding. When it is made clear to us that there
is a shortfall, then Congress often will step in to correct
that if the need is proved, so I just leave you with those
thoughts.
Chairman Johnson. I think, just for the record, it is true
that the adoption bill did not have any new money in it. There
was new money in the family preservation portion but not in the
adoption portion and the adoption new money was in the bonus.
It was the timelines and things like that that led to a lot of
State reform of the process that actually was extremely
favorable to children. So one of the reasons this bill is
before you is because there are a lot of process reforms.
Look at the administrative dollars, and why would you not
integrate training for foster care along with training for your
workers? I mean, foster parents are undertrained for the kind
of children they are working with. But why set up a separate
foster parent training program? Why not integrate it with your
casework training and then there will be a separate part that
has to do with managing a foster child with problems in your
own home.
But there is so much that could be integrated that it
really defeats my imagination as to why you oppose this,
particularly the administrative mergers when we have seen how
much administrative reform saved poorly spent dollars but also
helped children in the adoption reforms. So we have a long road
to travel on this issue.
Mr. English?
Mr. English. Madam Chair, in a second I am going to yield
the balance of my time to Mr. McCrery so that he can continue
his line of questioning, but first, I would like to
congratulate you on putting forward this legislation. I do
think it is timely. I also congratulate you for moving this
debate out of a sterile discussion of things like maintenance
of effort and toward flexibility. The thing that I have gotten
out of this hearing so far is those who advocate more money
consider it a prerequisite for passing flexibility and the
advocates of flexibility consider that a prerequisite before we
invest more money in the system. I think we do need to do both.
I do not think it weakens Judge Kearney's hand to give her the
flexibility now and look at the resources in the future.
I guess the other point I would make, having worked as a
staffer at the State legislative level in Pennsylvania, I do
not think the debates there make them readily confused with the
STOWA, but I do think that our State legislature is perfectly
capable of making intelligent decisions about where to allocate
our budgetary resources in Pennsylvania, and if given the
flexibility, I do think they will do the right thing, whether
there is a lobbying effort there for it or not.
I yield the balance of my time to Mr. McCrery.
Mr. McCrery. Thank you. I do not really want to ask more
questions of the panel. I appreciate the testimony. You do
raise some legitimate points for us to consider, but I have to
say I lean toward allowing more flexibility in this system.
What I would like to do, though, Madam Chair, with your
permission, is to acknowledge the tremendous work of a member
of our staff who will be leaving us soon. I just learned this
today and I was shocked and dismayed and felt instantly a great
sense of loss. Dr. Ron Haskins is going to move on to, we hope,
greener pastures.
Mr. Cardin. Is he coming over to the Democratic side? Is
that what you are talking about?
[Laughter.]
Mr. McCrery. He is going to the Brookings Institution. It
is close.
[Laughter.]
Mr. McCrery. Just kidding, if there is anybody here from
Brookings. It used to be that way, but with the new majority in
town, they have kind of corrected their shop.
[Laughter.]
Mr. McCrery. Dr. Haskins did just unbelievable work on
welfare reform and I dare say if it had not been for his work,
we would not have produced a product that--maybe not have
produced a product that could have passed and been signed by
the President, and certainly would not have produced a product
as finely honed and tuned and that has been shown to be so
successful without his work. He will be missed sorely by this
member and I am sure by every member who had the very
tremendous experience of working with him on welfare reform,
the biggest change in social policy in this country in probably
50 or 60 years.
Mr. Cardin. Would the gentleman yield?
Mr. McCrery. I would be glad to yield.
Mr. Cardin. I would also like for the record to associate
myself with your comments. Dr. Haskins has been an extremely
important part of the work of this committee and I have felt
extremely comfortable as a Democrat talking with him on any
issue and knowing that the information that I was receiving was
going to be the right information. He never, ever misled our
side of the aisle, always worked very closely with us and with
our staff people. I just want to thank him for his public
service. Clearly, children are better off as a result of his
efforts here in Congress.
Mr. McCrery. Thank you. I would like to yield to Mr. Camp.
Mr. Camp. I thank the gentleman for yielding. There is no
question that welfare reform would not have happened without
Dr. Haskins' efforts. He has been a source of--first of all, a
great resource, tremendously intelligent, and a real honest
broker in this whole process and somebody that we have all
relied on a great deal. I think when you look at the changes
that have occurred with our majority in 1995, welfare reform
may be our biggest accomplishment. He was right in the center
of that and it is his intelligence and drive that really helped
make it happen and made it easy for us as members. So I want to
say, thank you, Ron, for a job well done, and hopefully you
will still talk to us when you are at Brookings. Thank you.
[Laughter.]
Mr. McCrery. Thank you, Madam Chair.
Chairman Johnson. Thank you. I think that is a good note to
conclude this hearing on. I did not sort of focus on the fact
that this would be Ron's last hearing myself until I began to
open the hearing and realized that this would be the last time
that we would open a hearing together, Ron.
I do want to say that, really, without Ron's steadfast
focus on the structure that underlay the welfare reform bill,
and without his ability to clearly listen to and understand the
heart of people's concerns all across the spectrum of both
political parties, we could not have passed that bill and we
particularly could not have made it the force in the lives of
individual people and in our society that it has become,
because without repealing the entitlement, we would not have
gotten work on the table, and without getting work on the table
of people's lives, we could not as a government have gotten
services out there to support that work toward independence. It
really was Ron's bigger vision and the courage behind that
vision that enabled him to draw from all of the various groups
and members the insight we all jointly needed.
But a staff director that is able to do that for the
members and help them keep their eye on the most important of
all the balls is really not only a gift to the members that he
works with, but a gift to our nation, and we thank you, Ron,
for your knowledge, for the depth of experience that you bring
to the table, for your humanness, and for your honesty. It has
been a real honor to work with you. Thank you.
[Applause.]
Chairman Johnson. The hearing stands adjourned.
[Whereupon, at 11:37 a.m., the hearing was adjourned.]
[A submission for the record follows:]
Statement of Nancy Chandler, Executive Director, National Children's
Alliance
Mrs. Chairman and Members of the Subcommittee:
I appreciate this opportunity to provide written testimony
relative to H.R. 5292, Flexible Funding for Child Protection
Act of 2000. I applaud the efforts of this Committee in seeking
ways to enhance the child protection services provided by
states. National Children's Alliance and our nearly 350 member
programs offer states an opportunity to respond to the earliest
outcry of child abuse and neglect in a manner which keeps more
families intact, and reduces the use of foster care as a
protective device for children.
By way of introduction, National Children's Alliance was
founded in 1988 by then Madison County, Alabama District
Attorney Robert E. ``Bud'' Cramer, Jr. In response to a crisis
in services to children suspected of having been severely
abused and/or neglected, then District Attorney Cramer founded
the country's first Children's Advocacy Center in Huntsville,
Alabama in 1985. Mr. Cramer currently serves as a Member of
Congress representing the 5th District of Alabama.
Prior to this effort, investigation and intervention into
serious cases of child maltreatment had been sporadic and
without a common sense of duty and purpose. By bringing the
various members of the child protection, law enforcement,
prosecution, medical and mental health communities together,
this Huntsville model was instrumental in reforming the systems
that deal with child abuse cases. After the Huntsville
Children's Advocacy Center opened, word quickly began to spread
about this revolutionary way of intervening in cases of child
abuse and neglect. The Huntsville Center was deluged with
requests from communities across the country eager to open
their own children's advocacy center. In response, then
District Attorney Cramer and representatives of small and
large, urban and rural area CACs formed National Children's
Alliance.
As of September 2000, there are 259 full member programs 98
Associate member programs, and 31 chapters of National
Children's Alliance. There are sites in all fifty states, the
District of Columbia, and the Virgin Islands, as well as
Canada.
Children's Advocacy Centers offer a change in the way the
system handles child abuse cases. Rather than have each
identified agency act independently in their investigation,
Child Advocacy Centers bring all of the agencies ``under one
roof.'' In this model, children suspected of having been abused
are jointly interviewed by law enforcement as well as child
protective services so that a determination of the nature and
incidence of abuse can be made more readily. Law enforcement
works to see if a crime has been committed, while child
protective services works on a risk assessment to see if the
child can return to his or her home or if out of home services
are necessary. By immediately bringing these key agencies
together along with the medical, mental health and victim
advocacy components, plans can quickly be made to keep the
child safe from further harm.
By acting in tandem with their multidisciplinary partners,
each agency is then able to make a plan that is truly in ``the
best interest of the child.'' Through the early intervention of
law enforcement and prosecution, the alleged perpetrator can be
made to leave the home or be removed from the scene so that the
child can return home. Failing this, efforts are quickly made
to place the child with other non-offending relatives so that
the child is not forced into foster care.
This early, coordinated, multidisciplinary response is the
heart of a Children's Advocacy Center. So often, children are
placed into foster care simply because the systems need time to
complete an investigation and connect with other agencies. In
the Children's Advocacy Center model, these connections are
made more immediately and more efficiently.
By utilizing both private and public funding, Children's
Advocacy Centers offer a child-friendly model for private-
public partnerships that provide services to our most
vulnerable children. Over half of NCA's CAC member programs are
non-profits acting through signed Letters of Agreement and
Protocols to provide these early coordinated multidisciplinary
services. These protocols establish the manner in which each
agency is responsible for investigation and intervention. Cases
are tracked throughout the system so that no child is lost to
bureaucratic red tape.
States should be encouraged to use any flexibility in
funding to support the development and expansion of the
Children's Advocacy Center model. Our goal is that every
community in the country that wishes to have a Children's
Advocacy Center should be supported to build such a program.
National Children's Alliance stands ready, willing, and able to
enhance these efforts through training and technical
assistance.