Issue: Restructuring of Child Welfare Funding
Currently, the federal funding streams received by the state child welfare agencies are categorical in nature and emphasize out of home placement.
No formal position
The Pew Commission on Children in Foster Care reviewed the current funding structure and recommended the following in their May 2004 report:
• Preserve federal foster care maintenance and adoption assistance as an entitlement and expand it to all children, regardless of their birth families' income and including Indian children and children in the U.S. territories;
• Provide federal guardianship assistance to all children who leave foster care to live with a permanent legal guardian when a court has explicitly determined that neither reunification nor adoption are feasible permanence options;
• Help states build a range of services from prevention, to treatment, to post-permanence by (1) creating a flexible, indexed grant from what is included in Title IV-B and the administration and training components of Title IV-E; and (2) allowing states to "reinvest" federal and state foster care dollars into other child welfare services if they safely reduce their use of foster care; and
• Encourage innovation by expanding and simplifying the federal waiver process and providing incentives to states that (1) make and maintain improvements in their child welfare workforce and (2) increase all forms of safe permanence.
These Pew Commission recommendations have met with some resistance, but there continues to be an on-going dialogue in the child welfare community.
Child welfare advocates have been working to develop a proposal to reform federal financing of child welfare. This collaboration, Partnership to Protect Children and Strengthen Families, proposes to allow states to direct the unused portion of their annual allotment of Title IV-E foster care and adoption subsidy dollars to support a range of child abuse and neglect prevention services, ensure federal support to all children in foster care by eliminating the current income eligibility criteria, extend federal support to Native American children, and enhance accountability by requiring annual state reports on expenditures.
Representative Jim McDermott (D-WA) introduced the Invest in KIDS Act (HR 5466) on 2/8/08. The legislation would give states the option to include a prevention component in their foster care and adoption assistance state plan and eliminate the federal income and asset eligibility requirement.
Representative McDermott has indicated that he will take up financing reform in the 111th Congress.