COMMITTEE ON WAYS AND MEANS BILL THOMAS, California, Chairman
PHILIP M. CRANE, Illinois E. CLAY SHAW, JR., Florida NANCY L. JOHNSON, Connecticut AMO HOUGHTON, New York WALLY HERGER, California JIM MCCRERY, Louisiana DAVE CAMP, Michigan JIM RAMSTAD, Minnesota JIM NUSSLE, Iowa SAM JOHNSON, Texas JENNIFER DUNN, Washington MAC COLLINS, Georgia ROB PORTMAN, Ohio PHIL ENGLISH, Pennsylvania J.D. HAYWORTH, Arizona JERRY WELLER, Illinois KENNY C. HULSHOF, Missouri SCOTT MCINNIS, Colorado RON LEWIS, Kentucky MARK FOLEY, Florida KEVIN BRADY, Texas PAUL RYAN, Wisconsin ERIC CANTOR, Virginia	CHARLES B. RANGEL, New York FORTNEY PETE STARK, California ROBERT T. MATSUI, California SANDER M. LEVIN, Michigan BENJAMIN L. CARDIN, Maryland JIM MCDERMOTT, Washington GERALD D. KLECZKA, Wisconsin JOHN LEWIS, Georgia RICHARD E. NEAL, Massachusetts MICHAEL R. MCNULTY, New York WILLIAM J. JEFFERSON, Louisiana JOHN S. TANNER, Tennessee XAVIER BECERRA, California LLOYD DOGGETT, Texas EARL POMEROY, North Dakota MAX SANDLIN, Texas STEPHANIE TUBBS JONES, Ohio
Allison H. Giles, Chief of Staff Janice Mays, Minority Chief Counsel SUBCOMMITTEE ON HUMAN RESOURCES WALLY HERGER, California, Chairman
NANCY L. JOHNSON, Connecticut SCOTT MCINNIS, Colorado JIM MCCRERY, Louisiana DAVE CAMP, Michigan PHIL ENGLISH, Pennsylvania RON LEWIS, Kentucky ERIC CANTOR, Virginia	BENJAMIN L. CARDIN, Maryland FORTNEY PETE STARK, California SANDER M. LEVIN, Michigan JIM MCDERMOTT, Washington CHARLES B. RANGEL, New York
Pursuant to clause 2(e)(4) of Rule XI of the Rules of the House, public hearing records of the Committee on Ways and Means are also, published in electronic form. The printed hearing record remains the official version. Because electronic submissions are used to prepare both printed and electronic versions of the hearing record, the process of converting between various electronic formats may introduce unintentional errors or omissions. Such occurrences are inherent in the current publication process and should diminish as the process is further refined.

Advisory of June 6, 2004, announcing the hearing

WITNESSES

Pew Commission on Children in Foster Care, Hon. William Frenzel

Utah Department of Human Services, Robin Arnold-Williams, on behalf of the American Public Human Services Association

Child Welfare League of America, Southern Regional Office, Patricia Wilson

Lutheran Social Services of the South, Samuel Sipes

SUBMISSIONS FOR THE RECORD

Alliance for Children and Families, Carmen Delgado Votaw, statement

Child Protection Reform, Minneapolis, MN, J. Holderbaum, statement

Children's Law Center of Los Angeles, Monterey Park, CA, Miriam Aroni Krinsky, statement

Children's Rights, New York, NY, Marcia Robinson Lowry, statement

County Welfare Directors Association of California, Frank J. Mecca, Sacramento, CA, statement

Duranceau, Paula, Benton City, WA, statement

Huckelberry, Cynthia, Redlands, CA, and Sushanna Khamis, Yucaipa, CA, statement and attachment

Institute for Human Services Management, Baltimore, MD, Tracey Feild, statement

National Center for Youth Law, Oakland, CA, William Grimm, statement

National Indian Child Welfare Association, Portland, OR, Terry L. Cross, statement

New York State Office of Children and Family Services, Rensselaer, NY, John A. Johnson, statement

Seita, John R., Battle Creek, MI, statement and attachment

Volunteers of America, Alexandria, VA, statement

HEARING TO EXAMINE CHILD WELFARE REFORM PROPOSALS

Tuesday, July 13, 2004

U.S. House of Representatives,
Committee on Ways and Means,
Subcommittee on Human Resources,
Washington, DC.

The Subcommittee met, pursuant to notice, at 1:06 p.m., in room B-318 Rayburn House Office Building, Hon. Wally Herger (Chairman of the Subcommittee) presiding.

[The advisory announcing the hearing follows:]

Chairman HERGER.  Good afternoon and welcome to today's hearings. The gentleman from Texas, Mr. DeLay, who is very interested in child welfare issues is here with us today.  I welcome Mr. DeLay and I thank you for the work that you have done to improve the lives of vulnerable children.  Based on the precedent set when Mr. Payne of New Jersey, who is not a Member of our Committee, joined us on the dais at our November 6, 2003, child welfare‑related hearing, without objection, Mr. DeLay is allowed to sit on the dais and may question the witnesses.

Mr. CARDIN.  Mr. Chairman, let me just join you in welcoming our distinguished leader.  He has been the leader in this Congress on foster care issues and it is a real pleasure to have his wisdom with us today on the Subcommittee.

Chairman HERGER.  Thank you.  Without objection.  Today, we will review proposals to reform our Nation's child welfare programs because the status quo isn't adequately protecting our most vulnerable children.  Since November, this Subcommittee has held five hearings on this topic.  Two of these hearings focused on specific failures to protect child safety in New Jersey and Maryland.  The other hearings examined how State and Federal officials monitor programs that protect children and whether these programs adequately ensure the safety of vulnerable children.  We have heard from 41 witnesses, plus more than 60 other individuals and organizations provided input about problems with our Nation's child welfare system.

No one thinks the status quo is acceptable.  Every week, stories of children lost, abused, or worse yet, killed appear in newspapers across America.  We owe it to them and to the half‑million children in foster care to improve this system.  The Federal Government provides more than $7 billion in foster care and adoption funds every year to the States.  In comparison, as Mr. McDermott noted in our last hearing, funding for prevention and support services is only about $700 million.  As a result, rather than focusing on the prevention of abuse and neglect, today's funding structure encourages the removal of children and break‑up of families.  That is unacceptable.

In May, the nonpartisan Pew Commission on Children in Foster Care offered recommendations to overhaul the financing of child welfare programs.  I am pleased that former Congressman Bill Frenzel, Chairman of the Commission, has joined us today to outline this proposal.  I thank him, another former colleague, Vice Chairman Bill Gray, and the other members of the Commission for their outstanding work in this area.

The Commission's report argues that additional resources and flexibility are critical to ensure that children are protected and families stay together.  As we have heard, the Administration has proposed changes that also would provide more resources and flexibility for States to provide additional services.  Several of our colleagues have introduced legislation that would increase funding for certain activities within the child welfare system.

Today's witnesses will discuss these proposals.  I also have provided our witnesses and the minority a copy of draft legislation I am developing that builds on the Pew Commission's recommendations and the Administration's proposal. This legislation has three main principles.  First, it would provide adoption assistance for all children adopted from the public child welfare system regardless of their family's income.  Second, it likewise would provide foster care assistance for all children regardless of income, while at the same time providing new incentives to keep children from languishing in foster care.  Third, it would give States more flexibility and more resources to protect children and strengthen families, encourage greater accountability, and reward improved performance in protecting children.

In all, this legislation increases funding and flexibility for States to operate improved programs that do a better job protecting children.  We welcome comments on this proposal, as well.  I have received the testimony of our witnesses and I expect that as the hearing progresses today, we will clarify how the draft bill would prevent children from needlessly lingering in foster care for extended periods of time.  I hope to introduce this legislation shortly, including with the addition of helpful suggestions proposed today.

[The opening statement of Chairman Herger follows:]

Mr. Cardin, Mrs. Johnson, and I have met to discuss this legislation and I remain hopeful we can proceed in a bipartisan way.  Another proposal we will explore today is H.R. 4504, the Orderly and Timely Interstate Placement of Foster Children Act of 2004.  This bill is sponsored by our distinguished Majority Leader, Tom DeLay, and I am pleased to join him and our colleagues, Mrs. Johnson, Mr. Camp, Mr. Lewis, and Mr. Cantor, in cosponsoring this important legislation.

On average, it takes a full year longer for a child to be adopted through an interstate placement compared with a placement within the same State.  We must do more to ensure that all children are not lingering in foster care when a loving home is readily available for them.  This proposed legislation we are discussing today takes an important step in that direction.  Again, we welcome the Majority Leader, who has joined us today to hear testimony on this important legislation and I commend him for his dedication and commitment to improving our Nation's child welfare programs.  I thank all of our witnesses for joining us today and for their dedication and work to ensure safe, permanent, loving homes for vulnerable children.  Without objection, each Member will have the opportunity to submit a written statement and have it included in the record at this point.  Mr. Cardin, would you like to make an opening statement?

Mr. CARDIN.  Yes.  Thank you, Mr. Chairman.  Let me thank you for conducting this hearing in regards to the adoption issues.  I just want to applaud the efforts that have been made in this Congress to advance the issue.  The Majority Leader has certainly been a true leader on this issue and we very much appreciate the continued progress that we can make in this regard.  In regards to the foster care system, Mr. Chairman, let me point out I thank you for holding this hearing and thank you for the other hearings that we have held.  We have put a national spotlight on our foster care system because we know that we need to change it.  We know that there hasn't been the leadership in this Nation to deal with our most vulnerable children, and you and the Majority Leader and others have said we can do a lot better.

We have held a lot of hearings to try to understand the problem and we have seen firsthand the problem in our foster care system.  We have seen that the Attorney General of Texas, when he said that in many cases, we take children out of abused homes and we put them into foster care that is no better than the homes that we took them out of.  We saw that firsthand with the Jackson children in New Jersey, who were malnourished for years and developed at one‑half of their normal size.  No one took action to change that.

We saw firsthand the problems in Maryland, where a foster child had a child that was abused and taken away from her.  She then had twins and showed up in the emergency room as the children were being delivered, no prenatal care.  The hospital had all the red flags going up why those twins should not have been returned to that child, and yet they were and they were killed.  We have seen firsthand the problems in our foster care system with the inadequate attention paid to our most difficult children and not paying attention to red flags that go up, and we know that we can do better and we must do better and we wonder whether if we have reformed our system here at the Federal level, we could have prevented some of these tragedies.

We need to do things differently here in Washington, as my good friend from Connecticut continues to remind us, that we just can't continue to put money into the current system, that we need to change the way that we do business here in Washington and our expectations of what will happen at the State level.  We have got to change the way we do business at the State level.  Literally, the lives of our children are at stake.

Chairman Herger, I congratulate you for submitting a draft bill.  We need to do things differently here in Washington and you give us a bill on which we hopefully can work together in order to move forward.  I think it is constructive.  You provide more resources and you modernize the eligibility system.  I hope it is still a work in progress, Mr. Chairman.  You pointed out in your opening statement that you wanted helpful suggestions and I will make some helpful suggestions and I hope that we will be able to continue to make changes in this legislation.

The first point I would point out is that the proposed cap on the foster care payments to me changes the fundamental responsibility at the national level to be a safety net in regards to the children who enter our foster care system, and let me remind you that we have not been very good historically in projecting baseline expenditures.  I know that you have intended this to be a proposal that actually would put more money into the child welfare system, but let me remind you that we have projected a 19-percent growth in foster care between 1988 and 1993 and, in fact, it was a 163-percent increase.  We didn't recognize the epidemic of the crack cocaine babies, and that could obviously happen again.  That is one area that I hope that we can modify.  I find that to be a fundamental issue that needs to be included.

Secondly, improving the workforce issues.  We have seen over and over again that the caseworkers, the people who have the most important responsibility of dealing directly with our children‑‑if they were pediatricians, we would demand that they have certain training.  Yet as caseworkers, we put them out there with a minimal amount of training.  The turnover is less than 2 years for people who are actually in the field providing the services.  The caseloads in some cases are two to three times the national standards.  We need to have in our legislation here ways that we reward workforce improvement, and I would hope that we could work in the legislation that we develop to include that.

Then we need to help relatives of children that can't be returned to their home, the subsidized guardianship issue.  You have suggested that in a revenue neutral way.  I don't think that works, because we are trying to increase the number of children actually who are going to be receiving services, and I would hope that we could work to improve your legislation in that regard.   Mr. Chairman, I could be so bold as to suggest that we just adopt the bill that I filed earlier that reformed the child welfare system.  I thought that was a very good bill‑‑

[Laughter.]

It helps States correct deficiencies identified in the Federal review.  It improved the child welfare workforce.  It addressed the connection between substance abuse and child abuse.  It increased resources for preventive activities.  It provided assistance for legal guardianship, and it updated the foster care eligibility standards, a pretty good bill.  Let me just suggest that the experiences that we went through on welfare reform might serve us well as we look at child welfare reform.  We passed reform in 1996 that was truly bipartisan.  Yet in the last 3 years, we have been unable to pass a bipartisan bill in the House of Representatives.  As a result, no legislation has been enacted and our States are really suffering under short‑term extensions when we all know we need long‑term extensions.  If I could be so bold to suggest that I think that my legislation that I would like to see move has virtually no chance of enactment.  I understand that.

[Laughter.]

I want to get bills passed.  I think the Pew Foundation has brought forward a proposal that can be passed in both the House and the Senate and enacted into law and it is something that we should take a very serious look at.  The Pew Foundation maintains the guaranteed payment within the foster care payment structure, which to me is fundamental in reaching a bipartisan agreement.  There are other issues I hope that we can address, but if we want to get a bill enacted this year with the current membership of this Congress and the White House, then I think when you get Bill Frenzel and Bill Gray to agree on a bill, we should take very serious consideration of it.  Both of these individuals are giants in the Congress of the United States on fiscal responsibility and on the right role that the Federal Government should play in critical issues.  There is no more distinguished person I served with in the Congress than Bill Frenzel, nor a more conservative Member of the Congress that I served with than Bill Frenzel, and I think he has given us good guidance for a way that we really could get something accomplished and to the President's desk and signed into law, and I think we should take that good advice.

Lastly, Mr. Chairman, let me point out that in foster care, we are the parents.  We have the responsibility.  We made the decision that we are going to intercede in the care of a child, and that is an awesome responsibility.  We are not carrying that out today and we need to do better and I think it starts with legislation here in Washington, and we have a responsibility to those children to figure out a bipartisan bill that can be enacted into law with the current membership of our government, and I think the Pew Foundation has given us a way to get that done.  Thank you, Mr. Chairman.

Chairman HERGER.  Thank you, Mr. Cardin.  Before we move on to our testimony, I want to remind our witnesses to limit your oral statement to 5 minutes.  However, without objection, all the written testimony will be made a part of the permanent record.  This afternoon, we will hear from the Honorable Bill Frenzel, Chairman of the Pew Commission on Children in Foster Care; Dr. Robin Arnold‑Williams, Executive Director of the Utah Department of Human Services on behalf of the American Public Human Services Association (APHSA); Patricia Wilson, Director of the Southern Regional Office for the Child Welfare League of America (CWLA); and since we have someone from the State of Texas, would the Majority Leader like to introduce our final witness?

Mr. DELAY.  Thank you, Mr. Chairman.  Mr. Chairman, Mr. Cardin, and Members of the Subcommittee, I greatly appreciate your courtesy in allowing me to sit on this dais to hear testimony on the very important bills, and I thank you, Mr. Chairman, for calling this hearing today to discuss important reforms in the child protection system.  I appreciate the comments made by both you, Mr. Chairman, and Mr. Cardin.

With all States failing the Child and Family Services reviews and the increase in child fatalities, it is time to closely examine the system.  There is a general agreement that the way we fund child protection is perverse.  We pay for more beds and we get more kids in care, not more kids cared for.  It is time to change all of that.  I am especially thankful that today we are going to hear testimony on my bill, cosponsored by the Chairman and many Members of this Subcommittee, to reform the Interstate Compact on the Placement of Children.

This legislation is designed to help children find the loving families they need so that they can grow up able to love.  Mr. Chairman, we keep track of chickens going across State lines.  It is time we started doing the same for children.  Mr. Chairman, I would like to submit for the record a sampling of the letters of support for H.R. 4504.  These are letters that indicate broad support for this bill from organizations like the National Foster Care Association and the National Association of Psychiatric Health Systems and others.

Chairman HERGER.  Without objection, they will be included.

[The information follows:]

National Foster Parent Association
Gig Harbor, Washington 98335
June 14, 2004

Congressman Tom DeLay
242 Cannon HOB
Washington, D.C. 20515

Dear Congressman DeLay:

On behalf of the Board of Directors for the National Foster Parent Association. I am writing to express the heartfelt thanks of the hundreds of foster to mifies who care for our most vulnerable children for your leadership in introducing H.R. 4504, ti,e Orderly and Timely Interstate Pfacemert of Foster Children Act of 2004. This legislation will ensure that children waiting to be placed in safe, loving homes in other states do not experience unnecessary bureaucratic delays that rob tnem of the opportunity to establish nurturing connections with relative caregivers or adoptive parents in a timely manner. Moreover, the legislation will ensure that a child's foster or kinship parents (including preadoptive parents) have the right to be heard at the juvenile court proceedings that determine the future of our nation's neediest children. As the individuals with the most day-to-day contact with foster children and the most likely candidates to provide permanent homes for children who cannot return to their families of origin, we value the opportunity to participate in the court proceedings that affect them. Research studies show that inclusion of children's caregivers can have a positive affect on court decision-making and we appreciate your leadership in ensuring that juvenile court judges throughout the country have the benefit of our perceptions.

Our organization, the National Foster Parent Association, works to strengthen foster families through nationally focused legislative advocacy, training and education, publications, and networking among foster parents, state and local foster parent associations, and child welfare organizations. We fufiy support. H.R. 4504 and look forward to its passage.

Sincerely,

Karen Jorgenson
Administrator

Legal Advocates for Permanent Parenting
San Mateo, California 94404
June 17, 2004

Congressman Tom DeLay
Majority Leader
United States House of Representatives
242 Cannon HOB
Washington, DC 20515

Dear Congressman DeLay:

I am writing in support of H.R.4504, the Orderly and Timely Interstate Placement of Foster Children Act of 2004. As an organization of attorneys, law professors and other legal professionals, most of whom have both personal and professional experience with foster care and/or adoption, we believe the legislation will improve outcomes for our nation’s most vulnerable children.

H.R. 4504 will encourage states to implement procedures to ensure that foster children waiting to be placed in safe, nurturing homes in other states do not experience unnecessary delays. Fiscal incentives to states for the completion of timely home studies will result in many children finding permanency in a timely manner.

In addition, H.R. 4504 will ensure that those individuals providing day-to-day care for foster children have a right to be heard at the juvenile court proceedings affecting the children in their homes. Research shows that inclusion of children’s caregivers in the judicial process provides judges with important information on how children are faring in out-of-home care. Participation in decision making activities is also related to recruitment and retention of quality families to provide care for our nation’s 550,000 foster children. Data indicates that foster families cite a lack of inclusion in the process as a prime reason leading to their decision to discontinue fostering children. Finally, children who are unable to return to their families of origin but who nevertheless find permanent, loving homes overwhelmingly do so in the homes of their foster or kinship parents.

In light of the important issues H.R. 4504 addresses, our organization supports urges its passage.

Very truly yours,

Regina Deihl
Executive Director

Straight from the Heart, Inc.
Vista, California 92083
June 17, 2004

Congressman Tom DeLay
Majority Leader
United States House of Representatives
242 Cannon HOB
Washington, DC 20515

Dear Congressman DeLay:

I am writing in support of H.R. 4504 and thank you for your attention to the important issues contained in this bill.

My husband and I have been foster/adoptive parents for over 26 years in Vista, California. We have cared for over 100 foster children and had the honor of adopting 8 wonderful children through the foster care system. I currently am the director of Straight From The Heart, Inc., a non-profit resource center for foster children and the families that care for them. In my capacity as a mentor for other foster parents, I regularly encounter frustrated families who are waiting and waiting for ICPC’s to be completed so that their foster children may have permanence. A child can wait as long as 9 months before getting on a plane to their permanent families. This is so difficult for the children and families and I am pleased that you are taking action to speed up this process of permanence for our children.

On a more personal note, I wanted to let you know how very important it is for foster parents to have a voice in court for the children they foster. Our eighth adopted child came to us as a newborn with Down Syndrome, heart surgery, endocrine imbalances, high heart rate, breathing difficulties, blindness, deafness, low muscle tone and of course drug exposure. She lived her first 34 days in intensive care unit at a Children’s Hospital. She required early intervention in the form of Occupational, Physical and Developmental Therapies, and has Deaf and Hard of Hearing, Speech and Language, and Vision Consultants to meet her needs. We are entrusted with responsibilities of meeting the medical, physical, emotional needs of this special child, working with the birth parents, social workers, attorneys, doctors, therapists etc…and yet are not considered important enough to truly be a member of the “team”.

I assure you that no one member of the team knows more about the child than the caretaker. We are there for the nightmares, the bedwetting, the panic attacks, the acting out behaviors, the depression and the grief they suffer due to their abuses. We do the therapies, doctor appointments, homework, little league and the visitation with the birth parents. It makes no sense to ignore the caretaker as a vital member of the team, yet that is so often the reality for foster parents across this nation. Vital information is kept from us that hinders us from doing our jobs under the guise of “confidentiality”. Foster parents struggle to have a voice in court. Some court rights have been given to us but need to be strengthened so that we can have our voices heard by the judge who makes life changing decisions for these children. The foster care system will improve with openness and inclusion of all members of the team who impact the life of the children we serve. There is no social worker, attorney, judge or doctor who impacts the lives of these children more than the foster parents who nurture them day in and day out.

Thank you for caring about our children and caretakers and for putting that concern into action in H.R. 4504. Your efforts are truly appreciated.

P.S. I have included a copy of our daughters court report that I submitted to the judge during one of her hearings as an example of the types of information foster parents can share with the court concerning the children in our care.

Sincerely,

Patty Boles
Director

Alexandria Juvenile and Domestic Relations District Court
Alexandria, Virginia 22314
July 8, 2004

Majority Leader Tom Delay
H 107 Capitol
Washington, D.C. 20515

Dear Congressman DeLay:

I am pleased to write this letter in support of H.R. 4504, entitled the "Orderly and Timely Interstate Placement of Children Act of 2QO4". The Interstate Compact on the Placement of Children (ICPC or the Compact) is vital to the safe movement of certain at risk children from one state to another. While the ICPC is involved in a variety of case types, the primary area of concern with the Compact isthe movement of children in foster care between states. While assisting in protecting children, the ICPC also helps assurethat they receive necessary services once they arrive at their new place of residence.

For too many years, however, the process involved in the movement of these vulnerable children who are in foster care has taken too long thus delaying permanency for them. Despite repeated studies of problems inherent in the ICPC, very little progress has been made to make it work more effectively since it came into use over 40 years ago.

During the summer of 2003, The National Council of Juvenile and Family Court Judges (NCJFCJ) and the American Bar Association passed. Resolutions supporting the need for improvements in the ICPC. Over the past few years I have been, involved in efforts to improve the ICPC, including the drafting and passage of the Resolutions mentioned above.

In addition NCTFCT will be considering the attached Resolution, that I have drafted at its upcoming Annual Meeting later this month. When the proposed Resolution passes, I will he pleased to provide you with a signed copy of it.

While the proposed federal legislation will not and cannot solve all of the problems inherent in the ICPC, it addresses as much as it reasonably should, given that the ICPC is a state compact. If the improvements offered through this legislation and the funding mentioned in the legislation i states will have every reason to ensure that the process is done expeditiously and that delays in movement of children are sharply reduced.

Sincerely,

Stephen W. Rideout
Chief Judge

RESOLUTION

WHEREAS, the INTERSTATE COMPACT ON THE PLACEMENT OF CHILDREN (ICPC) has been adopted by all fifty states, the District of Columbia, and the U3. Virgin Islands; and.

WHEREAS, the ICPC has been found in many cases to cause delay in the placement of children with family member's who live in another state from where the child currently resides, interstate adoptions, and placement in residential facilities in these other states; and

WHEREAS, the National Council of Juvenile and Family Court Judges on July 17, 1996, adopted a Resolution that supported improvements in the ICPC; and

WHEREAS, since the passing of that Resolution, problems continued to exist with the effective implementation of the ICPC and the understanding of the ICPC by judges, lawyers, and social workers who are involved with these cases; and

WHEREAS, the National Council of Juvenile and Family Court Judges and the American Bar Association, at their Annual Conferences in July and August 2003 adopted Resolutions supporting improvements in regard to the ICPC; and

WHEREAS, proposed federal legislation entitled the "Orderly and Timely Interstate Placement of Foster Children Act of 2004" has been introduced, which seeks to improve the ICPC process; that the proposed legislation, which is attached hereto, among other things (1) seeks to have the states expeditiously revise the ICPC to better serve the interests of children and reduce mnecessary paperwork (2) seeks to have ICPC home studies completed within 60 days of the receipt of the request in the receiving state either by the state agency of private provider (3) seeks to have the states make its decision concerning the interstate movement of the child in a timely manner (4) provides incentive monies for timely ICPC home studies performed by the states (5) provides mechanisms for timely registry checks for prospective placements (6) requires states to provide health and education records to any child who leaves foster care by reaching the age of majority under state law (7) allows courts access to parent locator services to locate parents in foster care or adoptive placement cases, and (S) requires states to notify foster parents, pre-adoptive parents, and relative caregivers of a child in foster care of any proceedings to be held with respect to the child; and

WHEREAS, the National Council of Juvenile and Family Court Judges approves of the proposed legislation and encourages its passage by the Congress of the United States and enactment into Iaw:

NOW THEREFORE, BE IT RESOLVED AS FOLLOWS:

RESOLVED, That the National Council of Juvenile and Family Court Judges supports the proposed legislation and encourages its passage by the Congress of the United States and enactment into law.

National Association of Psychiatric Health Systems
Washington, DC 20004
July 8, 2004

Representative Tom DeLay
House Majority Leader
H-107 Capitol Building
Washington, DC 20515

Dear Majority Leader DeLay,

The National Association of Psychiatric Health Systems (NAPHS) is pleased to support H. R. 4504, a bill that will improve protections for children and hold states accountable for the orderly and timely placement of children across state lines. This measure will improve and streamline the Interstate Compact on the Placement of Children (ICPG).

NAPHS represents provider systems that are committed to the delivery of responsive, accountable, and clinically effective treatment for children, youth, and adults with mental and substance use disorders. Members are behavioral healthcare provider organizations, including 500 specialty hospitals, general hospital psychiatric and addiction treatment units, and mental health residential treatment centers.

NAPHS strongly supports the limitation of the applicability of the Interstate Compact for the Placement of Children (1CPC) to children in foster care under the responsibility of the state except those seeking placement in a residential facility or hospital primarily to access clinical mental health services.

Article II of the current ICPG clearly states that "placement" means the arrangement for the care of a child in a family home or a child caring agency or institution but does not include any institution caring for the mentally ill or any hospital or other medical facility. Unfortunately, regulations later adopted are contradictory and difficult to interpret - leading to confusion for States and providers,

The inappropriate application of the ICPG to mental health residential placements has caused significant delay and harm to children and youth with serious mental health disorders without providing any additional protections or benefits.

Mental health residential care and hospital programs differ from out- of- state adoptions or foster care placements in every way. Mental health residential treatment programs, like hospitals, are temporary and operate under an array of State and federal laws and regulations as well as accrediting standards.

Such placements are designed to provide active treatment in a therapeutic environment so that the child will be able, in the foreseeable future, to achieve treatment goals and be returned to the state for follow through on next steps.

Childrenneeding such placement are in crisis and cannot wait for the ICPC process that could take an extended period of time. An unintended consequence of such delays is that children may deteriorate further or be held in inappropriate settings such as juvenile detention while waiting. Lastly, the placing state agency utilizes contracts or similar documents that detail, assure, and monitor treatment and services. Contracts aretimelimited and ensure that paymentisreasonable and madeaccordingto state standards, (Further information on why the ICPC should not cover such placements is attached for your use and inclusion in the record as appropriate.)

H.R. 4504 would eliminate confusion caused by the current ICPC and assure that public or private placements of children and youth made to residential care and hospitals are not subject to the ICPC when the programs provide 24-hour care approved by the State for the purpose of providing clinical mental health services Again, thank you for your leadership on this issue. We are committed to working with you and are very supportive of H. R. 4504.

Sincerely,

Mark Covall
Executive Director

Consortium for Children
San Rafael, California 94901
July 9, 2004

Congressman Tom DeLay
242 Cannon 11013
Washington, DC 20515

Dear Congressman DeLay:

Consortium for Children would like to express our support for your bill H.R. 4504 titled "Orderly and Timely Interstate Placement of Children Act of 2004".

Placement across jurisdictions (states and counties) is a last choicefor most public agency adoption practioneers. Home Studies take an inordinate amount of time, the paperwork for interstate placement of children is burdensome and the time frames lengthy. Interstate placement of children, as it currently exists, does not serve children or their prospective permanent families well.

Due to the cumbersome and lengthy nature of inter jurisdictional placements public child wel f are agencies go to great length to identify permanent families within their own_.jurisdiction before looking outside their purview. This practice can and does limit choices for children as well as extend their stay in the foster care system, Children who are waiting for permanent families should be viewed as "citizens cif the nation" and all potential families be equally considered as a resource for a child no matter where they reside.

H.R. 4504 will go a long way in ameliorating many of the issues mentioned above. The specified time frarnes flor home study completion, involving the judiciary, and federal incentives mentioned in your hill should help ease the process as well as the perceptions about the inter-state placement cif children and, as a result, shorten their stay in foster care.

For the above reasons the Hoard of Directors of^`Consortium for Children supports H.R. 4504.

Sincerely,

Kate Cleary
Executive Director

KidsPeace
Orefield, Pennsylvania 18069
July 9, 2004

Representative Tom DeLay
House Majority Leader
H-107 Capitol Building
Washington, DC 20515

Dear Majority Leader DeLay,

KidsPeace is pleased to support H.R. 4504, a bill that will improve protections for children and hold states accountable for the orderly and timely placement of children across state lines. This measure will improve and streamline the Interstate Compact on the Placement of Children (ICPC).

KidsPeace is a private charity dedicated to serving the critical behavioral and mental health needs of children, preadolescents and teens. Founded in 1882, KidsPeace provides specialized residential treatment services and a comprehensive range of treatment programs and educational services to give hope, help and healing to children facing crisis.

KidsPeace strongly supports the limitation of the applicability of the Interstate Compact for the Placement of Children (ICPC) to children in foster care under the responsibility of the state except those seeking placement in a residential facility or hospital primarily to access clinical mental health services.

Article II of the current ICPC clearly states that “placement” means the arrangement for the care of a child in a family home or a child caring agency or institution but does not include any institution caring for the mentally ill or any hospital or other medical facility. Unfortunately, regulations later adopted are contradictory and difficult to interpret – leading to confusion for States and providers.

The inappropriate application of the ICPC to mental health residential placements has caused significant delay and harm to children and youth with serious mental health disorders without providing any additional protections or benefits.

Mental health residential care and hospital programs differ from out-of-state adoptions or foster care placements in every way. Mental health residential treatment programs, like hospitals, are temporary and operate under anarray of State and federal laws and regulations as well as accrediting standards.

Such placements are designed to provide active treatment in a therapeutic environment so that the child will be able, in the foreseeable future, to achieve treatment goals and be returned to the state for follow through on next steps.

Children needing such placement are in crisis and cannot wait for the ICPC process that could take an extended period of time. An unintended consequence of such delays is that children may deteriorate further or be held in inappropriate settings such as juvenile detention while waiting. Lastly, the placing state agency utilizes contracts or similar documents that detail, assure, and monitor treatment and services. Contracts are time limited and ensure that payment is reasonable and made according to state standards.

H.R. 4504 would eliminate confusion caused by the current ICPC and assure that public or private placements of children and youth made to residential care and hospitals are not subject to the ICPC when the programs provide 24-hour care approved by the State for the purpose of providing clinical mental health services. Again, thank you for your leadership on this issue.

Sincerely,

C.T. O’Donnell, II
President and Chief Executive Officer

National Council of Juvenile and Family Court Judges
Reno, Nevada 89507
July 8, 2004

Majority Leader Tom DeLay
H 107 Capitol
Washington, D.C. 20515

Dear Congressman DeLay:

On behalf of the Executive Committee of the National Council of Juvenile and Family Court Judges (NCJFCJ), I am pleased to write this letter in support of H.R. 4504, entitled the “Orderly and Timely Interstate Placement of Children Act of 2004”. As our organization will not hold its meeting to approve the attached Resolution until later this month, I am unable at this time to provide you with any other documentation of support from our organization. When the Resolution is passed, I will be happy to provide you with a signed copy of it.

The Interstate Compact on the Placement of Children (ICPC or the Compact) is vital to the safe movement of certain at risk children from one state to another. While the ICPC is involved in a variety of case types, the primary area of concern with the Compact is the movement of children in foster care between states. While assisting in protecting children, the ICPC also helps assure that they receive necessary services once they arrive at their new place of residence.

For too many years, however, the process involved in the movement of these vulnerable children, who are in foster care, has taken too long thus delaying permanency for them. Despite repeated studies of the problems inherent in the ICPC process, very little progress has been made to make it work more effectively since it came into use over 40 years ago.

Over the past few years our organization through the Advisory Committee of the Permanency Planning Department has supported efforts to improve the ICPC. During the summer of 2003, NCJFCJ and the American Bar Association passed Resolutions supporting the need for improvements in the ICPC.

While the proposed federal legislation will not and cannot solve all of the problems inherent in the ICPC, it addresses as much as it reasonably should, given that the ICPC is a state compact. If the improvements offered through this legislation are put in place and the funding mentioned in the legislation is appropriated, states will have every reason to ensure that the ICPC Home Study process is done expeditiously and that delays in the interstate movement of children are sharply reduced.

Sincerely,

James A. Ray
President

Mr. DELAY.  Thank you, Mr. Chairman.  I would also like to welcome my old colleague, Mr. Frenzel, who I had also the distinctive pleasure of serving with such a distinguished gentleman over the years and really appreciate the work that he has done in this area with the Pew Foundation.  I also would like to welcome Sam Sipes to the hearing.  In the interest of full disclosure, Sam is actually a personal friend of mine.  I don't know if that helps him or hurts him, but he also is working with my wife and myself in trying to find new ways of providing safe, permanent, and loving homes for foster children by creating a community of foster homes in my district.  His organization is helping us.  In fact, it may be a partner in that.

Sam is President and Chief Operating Officer of the Lutheran Social Services of the South (LSS), which is a nonprofit organization that each year serves more than 25,000 of the children, elderly, and poor in Texas and Louisiana Protection Services, LSS has a 123‑year history of serving the State of Texas, my home State.  Sam holds a master's degree in social work from the University of Texas at Austin and I am just very thankful that he is here today representing LSS and I am very grateful for his support of H.R. 4504.  I thank you, Mr. Chairman, for the time.

Chairman HERGER.  Thank you, Mr. DeLay.  With that, our first witness is the Honorable Bill Frenzel, Chairman of the Pew Commission on Children in Foster Care.

STATEMENT OF THE HONORABLE WILLIAM FRENZEL, CHAIRMAN, PEW COMMISSION ON CHILDREN IN FOSTER CARE

Mr. FRENZEL.  Mr. Chairman, Mr. Cardin, ladies and gentlemen of the Subcommittee, Majority Leader DeLay, thank you very much for inviting me.  After all those nice words, I will probably ascend directly into heaven before your very eyes.

[Laughter.]

I thank you for uttering them.  My statement has been submitted.  It is a little longer than the Iliad and somewhat shorter than the Clinton biography‑‑

[Laughter.]

So, I am not going to read it.  I will proceed, if I may.  Probably while I was recognizing Congressman DeLay, I ought to say that our commission, of course, was not aware of his bill or the details of his bill as we were going forward, but we agree that that is an important field that has to be reformed and we are very glad that he has submitted a bill and that many of you seem to be interested in it.  I am also speaking for Bill Gray, which you have already noted, and let the record state I am not trying to claim an extra 5 minutes.

[Laughter.]

Bill has been a great performer on our commission and he wishes he could be with us today.  I am not going to repeat the words of our report except to say that our commission started and ended every session that it held with an examination of what we called our child‑centered principles, and while we started with about 16 and worked our way down to probably half that number, in shorthand, we used the phrase on the first page of my testimony, and that is that every child needs a safe, permanent, loving family.

This was the centerpiece of our deliberation.  Each time we took on a tough chore and had to reach a compromise where certain of our members had to give, we always reverted to our principles.  We also had some special goals besides that.  We wanted to be sure that we got the incentives right in the financing system, that is that States didn't have an incentive to keep children within the foster care system, that the incentives were to get out, that there was an incentive to improve workforce performance, that other incentives were included.  One of our goals was flexibility.  We wanted to be sure that the operators of the system who knew what they needed in their own areas had the opportunity to make choices in relation to the work that confronted them.  Finally, we wanted to improve the accountability for the operators of the system because we think that is very important, too.

Mr. Chairman, our bills are very similar, that is, the Pew Commission's recommendation and the so‑called Herger draft.  We congratulate you for that.  I don't know if you are brilliant or we are.  I think, rather, it is that the same kinds of subjects come up whenever improvement of the foster care system is discussed and so perhaps we stumbled down the same alleys together and came to similar conclusions.  There are a few places where I would like to make some of those suggestions that you have invited from us and I think you will find them quite similar to some of the suggestions Mr. Cardin has already made.

In the first place, we suggested that an entitlement be retained for the foster care maintenance costs.  We debated this very heavily, because we talked about full grant, retaining entitlements, capping entitlements, having entitlements decline, et cetera.  We came to the conclusion as a matter of compromise that financing of these expenses is a shared Federal‑State responsibility for which the States need some kind of a guarantee and some kind of a safety net, and I do not denigrate the safety net that you have put in your bill.  It seemed to us that the operators really had to be on board and they were very strongly believing that they needed this continuing entitlement.  The crack cocaine epidemic already mentioned is still green in their memories and they have their worries.  They are also always nervous about grants being cut back or eliminated.

The other suggestion, main suggestion that we have with respect to your bill, Mr. Chairman, is our suggestion for subsidized guardianship.  Thirty States have some form of guardianship which they support.  The incentives in the system today build an over‑reliance on foster care, and a State that is paying foster care, is being paid foster care by the Federal Government, has little incentive other than the adoption incentive to move children out.

We believe a subsidized guardianship payment will really help achieve permanence and these safe homes that we want for children.  Now, we have taken great care to structure our recommendation so that there are very strong lines, deep lines drawn in the sand, which include, of course, that the child has to be in the system already, has to be in the system for a fairly long time, and that the court has to make a determination that neither reunification nor adoption are options, and that there has to be some kind of demonstrated attachment between the child and the guardian.

We do note that in the State of Illinois, a pioneer in the guardianship system, adoptions continued to rise.  We don't look on them as competitive, but rather guardianship is an extra leg of the stool of permanence for these children.  Now, we also included in our bill a permanence incentive and a workforce performance incentive.  We hope that as you and the Committee leadership work on improving this bill‑‑it seems impossible to think it could be improved.

[Laughter.]

We hope you will look at maybe changing the bill.  We hope you will look at those particular items.  Mr. Chairman, I can't say enough for your leadership in producing this draft and moving forward.  The Commission, I am sure, is just delighted that you are taking this tack.  We like what you are doing.  Of course, as a Commission, we are stuck with our own recommendation.  Naturally, we are going to be for us, but it doesn't mean we are not for you.  We are very proud of you and we look forward to working with every Member of your Subcommittee and other Members of Congress, like Mr. DeLay, in moving a bill, and as has been suggested twice, we hope that it is a bipartisan bill because that is the history in this field.  Thank you very much, Mr. Chairman.

[The prepared statement of Mr. Frenzel follows:]

Chairman HERGER.  Thank you very much, Mr. Frenzel.  Again, I want to thank you for your longtime work in the U.S. Congress and specifically for your work in this area, which is so important for those young people, those children most in need.  Thank you very much for your work, and the work of your commission.  Now, Dr. Arnold‑Williams to testify.

STATEMENT OF ROBIN ARNOLD‑WILLIAMS, EXECUTIVE DIRECTOR, UTAH DEPARTMENT OF HUMAN SERVICES, SALT LAKE CITY, UTAH, ON BEHALF OF THE AMERICAN PUBLIC HUMAN SERVICES ASSOCIATION

Dr. ARNOLD-WILLIAMS.  Mr. Chairman and Members of the Subcommittee, I am pleased to join you today to testify on behalf of the APHSA.  The Child and Family Service Review (CFSR) baseline results reveal the many challenges States face in achieving safety, permanency, and well‑being for children in our care, but improvements are being made and we have achieved noteworthy increases in adoptions and family reunifications.

State Administrators have focused efforts and resources on implementing the requirements of the Adoption and Safe Families Act (ASFA) (P.L. 105-89), and developing program improvement plans (PIPs) to achieve improved outcomes for children.  At the same time, fewer children are supported with Federal funds due to the "look back" provision.  In Utah, since 2002, our Title IV‑E penetration rate for foster care has dropped from 54 to 50 percent and adoption has fallen from 77 to 72 percent.  The APHSA has consistently supported a full Federal‑State partnership for every child in the child welfare system and we commend you for proposing legislation that addresses that goal.

However, the draft legislation proposes to reduce all State Federal medical assistance program (FMAP) rates by 35 percent for foster care and by 15 percent for adoption.  Under this mandatory approach, States would be dissimilarly affected.  States that have a high Title IV‑E penetration rate would be more negatively impacted.  We understand your fiscal constraints.  Therefore, we urge the Subcommittee to give States the option to either retain current law or opt into the new formula.

The draft legislation would impose an annual cap on funds available for Title IV‑E foster care maintenance.  We commend the Chairman for allowing the funding to increase over time and for allowing State reinvestment of any savings.  However, we have several concerns.  First, for States that have already reduced their foster care caseloads, the potential for savings and thus reinvestment is limited.  Second, we believe each State should have a baseline that reflects their projected annual rate of growth, independent of an a national one. Third, we applaud recognition that Title IV‑E funds ought to be used for services as well as for maintenance payments.  However, crises, such as the increasing use of methamphetamines in several States, have resulted in caseload increases and limit the savings for reinvestment.

Finally, the National Contingency Fund triggers may be set so high that an individual State may never be able to access them.  Again, we recommend making the guaranteed payment level a State option and not a mandate.  We must strongly oppose the provision capping Federal funding for caseworkers and training.  Child welfare staff courageously work in one of the most challenging professions in this country and we struggle to recruit, retain, and reward them.  Capped Federal funding is a step in the wrong direction.  The base years for calculating the administrative cap are problematic.  For example, last year, Utah added 51 caseworkers and trainers, but their funding would not be reflected in the baseline.

Subsidized guardianship provides for stable and permanent placements for children and APHSA believes that waiver demonstrations have proved it is time to amend Title IV‑E to allow States to fund this option.  Despite renewed emphasis on accountability and program improvement through the CFSR process, Title IV‑E funds cannot be used to achieve many of the mutually agreed‑on goals in our PIPs.  Given the large Federal role in developing and approving PIPs, APHSA proposes States be permitted to use Title IV‑E funds for any purpose approved under their PIP.  We would agree to continued evaluation to determine whether they make a difference in performance and whether that should continue.

For example, in Utah's PIP, one of the primary areas for which Title IV‑E will not be able to be expended is child well‑being in in‑home cases.  We currently serve nearly twice as many families with in‑home services as we do out of home.  Title IV‑E funds cannot be used for activities in those cases, like family involvement in case planning, worker visits, and providing physical and mental health care.  Although we did well on other portions of the CFSR, other States are struggling to find resources on several safety outcomes, including services to protect children, prevent removal, and reduce risk of harm.

With respect to the Interstate Compact on the Placement of Children (ICPC), APHSA has embarked on a comprehensive reform and we commend Majority Leader DeLay on his leadership in this area.  House Resolution. 4504 would impose a 60‑day limit on the completion of home studies.  States would be at risk of losing their Title IV‑E funds for noncompliance.  While we understand the goal of reducing the length of time to complete a home study, we have no data to suggest the 60‑day time frame will, in fact, expedite placements.  We recommend adding a "reasonable cause" exception for failure to meet the 60‑day limit, such as a delay in FBI background checks.  Given that the ICPC is a direct agreement between the States, we also urge inclusion of language restricting the Secretary from regulating home study definitions.  In conclusion, we look forward to working with the Subcommittee to devise a Federal financing construct that can help States meet the needs of children and families we serve.  Mr. Chairman, we thank you for your leadership on this important issue and I would be happy to answer any questions when that time comes.  Thank you.

[The prepared statement of Ms. Arnold‑Williams follows:]

Chairman HERGER.  Thank you very much, Dr. Williams.  Now to testify, Ms. Patricia Wilson.

STATEMENT OF PATRICIA WILSON, DIRECTOR, SOUTHERN REGIONAL OFFICE, CHILD WELFARE LEAGUE OF AMERICA

Ms. WILSON.  Good afternoon, Mr. Chair, Members of the Subcommittee, and Congressman DeLay, CWLA appreciates this opportunity to offer testimony on behalf of our nearly 1,000 public and private nonprofit child‑serving member agencies.  We especially are appreciative of the attention that this Subcommittee has brought to this important issue of child welfare reform.  Child welfare financing reform is important to the future of the 500,000‑plus children in foster care, the over 100,000 children awaiting adoptive placement, the 257,000‑plus families receiving adoption assistance, and the 1 million children receiving child protective services in their own home.

Our testimony this afternoon highlights our understanding of the draft legislation put forth by Congressman Herger and the Pew Commission report.  Both Pew and the draft legislation would make all abused and neglected children in foster care and adoptive placements eligible for Federal support at a reduced reimbursement rate.  We urge careful consideration, as too severe a reduction in the rate of the Federal share could create an increased and unacceptable burden on the States.

We strongly agree with the Pew recommendation to retain Title IV‑E foster care maintenance as an entitlement for children in care.  Maintenance, meaning food, clothing, shelter, and supervision, is extremely important and critical to the well‑being of those children.  The draft legislation caps the amount of Federal funds available for maintenance.  We are quite concerned that with that proposal that all children become eligible and the Federal share of every dollar spent be reduced, the States are going to be also limited in the amount of Federal assistance they can receive.

The draft legislation makes a provision for potential relief for States experiencing a severe foster care crisis.  This is based on what would be a phenomenal growth in numbers on an annual basis.  It does not take into account the needs of the children already in care.  Both Pew and the legislation allow for the transfer of unspent excess Federal funds to be moved from maintenance into the services block grant.  Based on States' current struggle to adequately cover the care for the children, the likelihood of excess funds seems remote.  Unused transferred foster care funds should not be relied on as a primary source of funding for prevention and other services.  An opportunity to transfer must be constructed in a way that does not create a disincentive for providing the care that children in placement need.

One of the strongest recommendations of the Pew Commission was the inclusion of Federal support for subsidized guardianship and kinship placements.  We support that.  The draft legislation provides this only as a waiver option.  We support the concept put forth by both the Pew Commission and the Subcommittee bill that would allow tribes and territories increased access to Title IV‑E funds.  Both would create a new block grant for services entitled, "Safe Children, Strong Families."  This would combine current Title IV‑E administrative and training funds as well as the Title IV‑E funds.  These are not new funds.  These funds are being used today to support direct contact and work with children and families.

Title IV‑E administration pays for the face‑to‑face time that caseworkers spend with children in foster care, making case plans with them and for them, securing services for them, preparing for judicial hearings, and not to mention recruiting the foster parents and adoptive parents who serve them.  Title IV‑E training funds prepares the workforce as well as the foster and adoptive parents, while Title IV‑B funds the services that enable children to remain in their own homes and to provide them with reunification services.

Pew recommends that a block grant be increased annually by the Consumer Price Index plus 2 percent.  In the confines of the draft legislation, this annual increase would be‑‑there would be an annual increase, but it would not be tied to a specific factor.  The COLA has questions about potential impact of including Title IV‑E training funds in a block grant that is designed to fund services.  Training is so vital to our workforce, also extremely important to the quality of decisions that are made about our children.  Combining it into a services block grant could force States to make a decision between funding a training program and direct service need.

We are pleased the Pew Commission recommended maintaining separate Federal funding for States' information systems.  In summary, we believe that the basic safety net of foster care and adoption assistance should remain an uncapped entitlement; that all children in foster and adoptive placements, including those under the auspices of tribes and territories, subsidize guardianship and kinship placement should be eligible for Federal support.

We should look to the States' PIPs to inform us about what new investments are necessary to better care for our children.  Any reform proposal must always be sure to address workforce issues, including practice standards for worker competence and caseload size.  We urge the Subcommittee to carefully consider the impact of reducing the Federal matching rate for foster care and adoption assistance as well as the impact of moving the entitlements of Title IV‑E administration and training into a block grant.  We encourage you also to take the time to fully evaluate and hear from all those impacted by the pending proposals, States, private agencies, and advocacy groups.  We thank you for this opportunity; CWLA offers our assistance and participation in this most important endeavor.

[The prepared statement of Ms. Wilson follows:]

Chairman HERGER.  Thank you very much, Ms. Wilson.  Now to testify, Mr. Samuel Sipes.

Mr. SIPES.  Good afternoon, Chairman Herger, Members of the Subcommittee, and Majority Leader DeLay.  Thank you for inviting me to testify today.  I am glad to be here today to address two critical issues, the movement of children across State lines to find appropriate and permanent homes, and the movement of dollars from Washington to States in order to fund child welfare services.  First, I would like to speak about reforms needed to facilitate the timely placement of children into loving homes across State lines.  Approximately 4 percent of foster children in the United States, nearly 20,000 children, are placed across State lines each year.  The ICPC was developed in the 1960s to ensure that children placed in homes across State lines were protected by the receiving State.  It took 30 years to get the basic provisions of the ICPC agreed to by all 50 States, and unfortunately, many of those provisions have begun to show their age.

Recent studies have shown that children placed across State lines end up waiting 1 year longer to find permanent homes than children placed in‑State.  Red tape resulting from the differences in home study requirements, State laws, and administrative policies are causing much of the delay.  In fact, it wasn't until just 4 years ago that the ICPC was amended to allow information to be transmitted via fax and overnight mail.  Very often, the waiting families are biological relatives of the child in question, and while they work their way through the red tape of the ICPC process, the child waits in child welfare.

The challenges created by interjurisdictional barriers to adoption across State lines are similar to those across national borders.  The LSS performs international adoptions and maintains offices in several foreign countries.  In Russia, for example, we have to constantly deal with the changing laws and regulations and remnants of Communist-era bureaucratic mindsets.  However, our Russian adoption program can usually facilitate the placement of a child into a waiting Texas family in about 9 months.  What does it say about the ICPC process when it is sometimes easier to work through the bureaucracy of the former Soviet Union and adopt a child out of a Russian orphanage than it is for a child's aunt and uncle to adopt him or her from a neighboring State?  Advocates generally agree that the system is broken.  Addressing the issues in Congress will avoid the decades‑long process to reach agreement in all States and affected jurisdictions.

I commend House Majority Leader Tom DeLay for introducing the Orderly and Timely Interstate Placement of Foster Children Act of 2004.  This Federal legislation will lower the barriers that currently prevent children from being placed in safe, loving families.  These are important and timely reforms.  Initiatives such as Adopt U.S. Kids along with the lowering of barriers to interstate placement of children will likely increase the number of children placed across State lines.  The bill also reinforces the need for States to partner with private faith and community‑based child placing agencies in order to accomplish the goal of timely placements of children.

Finally, I would like to commend Chairman Herger and the Subcommittee for your work in drafting for discussion the Child SAFE Act of 2004 dealing with Federal funding of child welfare programs.  The current system places rigid restrictions on States that often prevent them from using Federal funds in creative ways to address the needs of children and families.  The proposed legislation will give States more flexibility to fund other needed activities that currently fall through the cracks while at the same time preserving protections for children.  It will allow flexibility for funds to be used for prevention programs, recruitment and training foster parents who will then dedicate their lives to caring for abused and neglected children, and a safety net for children who age out of the child welfare system.

In conclusion, we have a child welfare system that too often places policies and programs ahead of the urgent needs of children.  Just ask any one of the 20,000 or so children every year who have to wait an extra year for a permanent home because the bureaucrats in one State are so tangled up in red tape that they can't come to an agreement with the bureaucrats in another State.  The reforms outlined in these two pieces of legislation begin to put things back in proper perspective and to place the needs of children at the center of the equation.  I would like to thank the Subcommittee for giving me the opportunity to testify and I would be happy to answer any questions at the appropriate time.

[The prepared statement of Mr. Sipes follows:]

Chairman HERGER.  Thank you, Mr. Sipes.  Now we will turn to questions.  The gentleman from Kentucky, Mr. Lewis, to inquire.

Mr. LEWIS.  Yes, Mr. Chairman.  I would like to yield my time to Majority Leader DeLay.

Chairman HERGER.  Without objection.

Mr. DELAY.  I thank the gentleman from Kentucky, Mr. Lewis.  I won't take long, Mr. Chairman.  Unfortunately, I have a meeting at 2:00 p.m.  Just very briefly, Mr. Sipes, we have received a tremendous support from foster parents on the right to be heard in court.  Could you talk about the importance of this provision to foster parents and the children in their care?

Mr. SIPES.  This is a huge issue in that foster parents are not universally afforded the opportunity to be present at proceedings affecting the children that they have been caring for.  These are individuals who have opened up their homes and their hearts to these kids.  Oftentimes, they are the people that know the children the best and certainly the ones that care about the children the most within the system, they love them.  They are acting as their parents.  All too often, we have heard stories from our own foster parents as well as people that foster for other agencies that they are informed after the fact that a legal proceeding has taken place and a decision has been made that, quite frankly, they have grave concerns over and they just weren't afforded the opportunity to be heard.  This is a huge issue to foster parents.

Mr. DELAY.  Thank you.  Mr. Frenzel, I appreciate the great work that the Pew Commission has done.  I do believe that abused and neglected children will benefit from Pew's thoughtful examination of the problems.  I don't agree with all your findings, but I think the Commission has worked very hard and produced a product that is really useful in the debate about funding child protection.  I see that Pew is recommending $5 million for expansion of the Court‑Appointed Special Advocates (CASA) program.  My wife is a CASA, so I am very familiar with this program.  Would this money go to the national CASA or who would it go to and what is it for?

Mr. FRENZEL.  The anticipation is that the money would be given to individual CASA units, particularly in those areas where they either don't exist or where they need to be strengthened.  I think the CASA people tell us across the board they don't want to be federalized.

Mr. DELAY.  Commendable.

Mr. FRENZEL.  They have got enough other problems without having the Federal Government in their face, but many of them have been started, at least, with start‑up funds such as we are suggesting, and that is our intention.  We do not‑‑we expect that this will result in the creation or the building of stronger CASA units in the field.

Mr. DELAY.  I think that is wise.  Dr. Arnold‑Williams, your testimony seemed to take issue with H.R. 4504 on mandating that home studies be conducted, completed, and returned in 60 days.  I understand the reasoning, if something unforeseen went wrong, like background checks.  Maybe you could give us an idea of what is causing the problem with criminal background checks.  Your testimony is silent on the $1,000 that a receiving State would receive should the paperwork be completed in 30 days.  What is your organization's opinion on the incentive payment?  Isn't it the case now that sending States can claim Federal dollars but receiving States, which are required to do the work, are not given any help in turning around the paperwork for the study, for home study?

Dr. ARNOLD-WILLIAMS.  Yes, that is absolutely true and that is one of the issues, is the lack of financing for the receiving State which has to do the work to get that done.  Just to speak maybe to the other reasons, Federal Bureau of Investigation (FBI) checks, I am not sure why they take too long.  In our State, we chose not to request them on anyone unless they hadn't been in our State for at least 5 years for that reason.  I should tell you that 77 percent of our ICPC requests are done within 30 days.  We try to meet those time lines in my State and we take that very seriously.

With respect to the $1,000 incentive, obviously, we would like incentives there for States to be able to do that or some financing mechanism for the receiving State.  I think there are concerns about the 30 days, again because of things like background checks, training requirements.  We require 32 hours of training for foster parents in our State.  We have very high standards.  There is some concern about can you fit all of that in within 30 days.  Part of it hinges on what is a home study.  Getting the basic health and safety things in place, I think you can do that within 30 days.  It is some of the others, like background checks, training, some of those things that we would like to have some flexibility in meeting that standard.

Mr. DELAY.  I understand that.  Lastly, Mr. Chairman, for Mr. Sipes, H.R. 4504 encourages private sector support in conducting, completing, and returning these interstate home studies.  Can you comment on the role that private agencies could play in helping children find permanency across State lines?

Mr. SIPES.  Yes, sir, I could.  I was a participant in a guidance work group that was put together by the Children's Bureau earlier this year to look at the ICPC process.  There were a number of State ICPC coordinators present, and one of the issues that came up was that when they get a request for a home study, they have caseworkers in the field that are dealing with child protection issues, children that are in eminent danger, high caseloads, and quite frankly, oftentimes, those requests don't get elevated to a priority and that is one of the reasons for delays.

At the same time, in virtually all States, there are very strong private nonprofit child placing agencies, many of whom have the capacity to send people out.  In fact, we have done that.  We have partnerships with a number of States around the country.  When they have a child that they are sending to Texas, they contact us and we do the home studies and we typically turn those around within 30 days at the longest, sometimes a couple of weeks, because our staff know.  They are in the field and they know that time is of the essence in this particular matter.  I really think that there is an untapped resource right now in the private sector that could really help achieve the time lines outlined in this legislation.

Mr. DELAY.  Thank you, Mr. Chairman.  I have other questions I will submit for the record, but I really appreciate the Committee's courtesy and thank you, panel, for your testimony and answers to the questions.

[The information was not received at the time of printing.]

Chairman HERGER.  Thank you, and again, thank you very much for your strong, longtime involvement in this area that is so important to the lives of so many young people.  Thank you very much, Mr. DeLay.  With that, the gentleman from Michigan, Mr. Levin, to inquire.

Mr. LEVIN.  Thank you, Mr. Chairman.  Thank you, Mr. Cardin, for letting me go before you.  Thank you, Mr. Chairman and everybody, for this hearing and all of the witnesses and all of you who are here who are not witnesses.  We have been wrestling with this problem for a long time.  It at least goes back as far as when I first joined the Subcommittee, which is now 17 years, and we have been trying to find better answers.  Mr. Frenzel, let me start off by asking you as an old teammate and friend, if you had to name one major change, improvement that would be brought about if the Pew Commission recommendations were adopted, what would be that major change?

Mr. FRENZEL.  Well, unfortunately, our commission made a report which is sort of a coherent whole.  When I start picking things out and nominating them for stardom, I‑‑

Mr. LEVIN.  How about improved‑‑

Mr. FRENZEL.  We really, we want the whole package.  I suppose the most important thing to me probably is the core financing business, where we take the totality of Federal funds, establish a place for the entitlement or the maintenance, and then we have the administrative and training funds in a grant that is escalated.  In that whole evolution, of course, we de-link, much in the way that the Chairman's draft suggests it, and that is probably the core financing bit of our recommendation.

Mr. LEVIN.  Great, let me ask you and everybody else, as I understand the draft bill, and it is just that, in terms of the funding core, what it would do at least in part would be to provide a cap.  It would expand eligibility, and it would reduce the foster care payments for each of the eligible.  I think I understand that.  Each of you quickly, because I only have 5 minutes, what is the potential impact of that structure along with the provision that Mr. Frenzel has mentioned in terms of putting other funds into an entitlement with greater flexibility?  If you expand eligibility but reduce the payment per person and you cap the overall expenditures, what is likely to result?  Maybe somebody else wants to go first.  Ms. Wilson, do you want to respond?

Ms. WILSON.  I would be glad to.  One of the concerns about just what you described is that States are left to care for the children they have in care, and when we have expanded eligibility, which is something that is needed, and we have reduced Federal share along with a cap on the amount a State can receive, that certainly leaves States at a disadvantage if costs rise, if the number of children rise.

Children, the number of children in care can remain static or just show a minimal increase, yet a State can have significant increases in the cost of providing for those children.  I think one of the things we have to be most cautious of is not doing something that creates a disincentive to take care of the children that are in care and that need to be in care and to cover the services that they require.

Dr. ARNOLD-WILLIAMS.  Maybe I would just add to that that you have to think about this in the context of your overall State budget.  For instance, this fiscal year in my State, Title IV‑E financing is only 20 percent of the $130 million budget I have for child welfare; it interplays with all of your funds there.  We are a State that has reduced our foster care caseload.  Since 1999, the number of children I serve in a given year in foster care has been decreased by 19 percent.  We have done that by investing in up‑front services.  We believe the concept works in terms of taking the resources you have, reduce foster care by using up‑front resources.

That is why we argue for an individual baseline, so that‑‑rather than tied to the national baseline, so that you can actually not penalize States like ours that have already made some investments and actually look at specific factors in your State.  We believe it can be done because we have done it by infusing additional Social Services block grant or general funds or other funds into that.  Again, it is an entire financing mix within your child welfare budget.

Chairman HERGER.  I thank the gentleman.

Mr. LEVIN.  Mr. Chairman, can Mr. Frenzel answer briefly?

Mr. FRENZEL.  The same number of children are involved.  The only difference is the States have to take care of them without Federal money.  The same amount of money goes to the same States, so we try to keep things even.  The biggest gain here is that the States don't have to mess around figuring out who qualifies for Federal money and who doesn't with this Mickey Mouse 1996 law that adds a huge administrative burden to the States.  Rationalizing through a de-link, the biggest advantage is it is going to save the States a lot of administrative money.

Chairman HERGER.  I thank the gentleman.  We do have three votes coming up and we will try to wrap up our questioning.  The gentlelady from Connecticut to inquire.

Mrs. JOHNSON.  I think in view of the fact that neither the Chairman nor the Ranking Member have had a chance to question, I am going to limit myself to just a couple of statements because they demand much too much time.  First of all, I am very impressed that by freezing welfare and now going through a 50-percent caseload cut, we have increased the money available for day care, for services, more than this Congress ever, under Republicans or Democrats or whatever, have increased it.

You look at the conditions of participation grants.  Now, I personally was very sorry to see them go, but what they did for 5 years‑‑they were 5‑year grants‑‑they allowed my local police department to completely turn itself into a community‑based system by giving the money to provide the officers to go out in the community and giving the whole police department time to reorganize its administrative load and who answers the phone and things like that.  I think we need money to front load, to help you change, and maybe we shouldn't exercise a cap right away.  I do think reducing your payments for foster care is really‑‑that concerns me a lot.

I am more interested in transitional assistance with a cap to follow, a cap will give you a guarantee that I think has some merit.  I think the fact that you will get rewarded if the States, everybody needs to put money back in so that there is some escalation.  I am discouraged that there is such a consistent rejection of the cap issue.  If you had adopted this cap concept in the year I first proposed it, in 1989 or something, you would have tons more money than you have now.

I urge you to look at what is the real issue here, which is getting in place the community‑based services so that you can cut the foster care.  I think the subsidized guardianship is extremely important.  We just have to get over this issue that children would be better out of their larger family than in their larger family, and so on.  I think this financing issue is a big issue.  I feel your feeling that fears of the past more than you are looking at the opportunities of the future.

The second thing‑‑this is harder‑‑we are not assessing these children when they come into foster care the way we need to.  We have got to figure out what is that assessment.  Now, not a whole psychological assessment, but there are ways of looking at what is the developmental state of this child?  Is this child 5 years behind their developmental state or are they doing all right developmentally?  Are they having special reactions to the trauma of being taken out of their homes?  I have talked to people who are leaders in this, nationwide trainers and so on and so forth.  There is a simple assessment, but if you did it, you would enhance the opportunity for this child to do well, whether in reunification or in placement, in a way that we are not now.  I just put those two ideas out there.  Those are two ideas that I want to see this develop, and I congratulate the Chairman and the Ranking Member for their dedication to working together, because we have got to do something.  When we have a hearing like we had recently where everybody failed after 12 years, that is just simply unacceptable.  Thank you very much, Mr. Chairman.

Chairman HERGER.  I thank the gentlelady.  The gentleman, the Ranking Member from Maryland, Mr. Cardin to inquire.

Mr. CARDIN.  Thank you, Mr. Chairman.  Let me just throw out a couple of questions.  I don't mean to burden you by written responses, but I would like to get responses and at the hearing today, obviously, we are not going to have the time, but I think it is important for our work.  I have serious problems, as I expressed earlier, about capping the entitlement.  There are who claim that by capping the entitlement, we remove a perverse incentive that encourages States to put people in out‑of‑home placement.  I don't understand that because States save money if they don't have to do out‑of‑home placement and it seems to me that that is not true, but I would like to get your views as to whether there is a perverse incentive under the current system.

Secondly, as we have pointed out, the Pew Commission is recommending capping the entitlement status currently for administration and training, putting it into a broader block grant with some additional resources.  Particularly to Ms. Wilson, but also to Dr. Arnold‑Williams, I would like to know whether you think that is a good compromise with maintaining the entitlement in the administrative side that the Pew Foundation does.  Would that be an adequate protection to the resources going to local governments in the event that there was a significant increase in caseload?  I just wanted to know whether you think you are adequately protected.

The third question would be, if we do cap the administrative maintenance payments, as suggested by the Chairman's draft, is there a contingency fund arrangement that could be developed that would adequately protect the States in the event of a caseload increase that you can conceive?  I know the Chairman has a provision in his bill, but I would prefer to get Ms. Wilson and Dr. Arnold‑Williams, and perhaps even the Pew Commission's thoughts as to whether there are alternatives that could deal with it.

I have a question whether you can develop an alternative.  I strongly believe that the entitlement is important for the maintenance program and have concern over capping, quite frankly, the administrative and training dollars.  I have a concern about that.  I look at what happened, again, the late 1980s with the crack cocaine babies and wonder whether there is anything we could put in Federal law that could protect the States if that were to occur. 

Mr. Chairman, they are questions that I have.  I don't think we have adequate time to get responses because of the pending votes on the floor of the House, but if our witnesses could provide that information, certainly I think it would be helpful for the full Committee.

Chairman HERGER.  I thank the gentleman from Maryland.  If our witnesses could provide us with that information, I would appreciate it.  As a matter of fact, I would like to also request‑‑I have a question of you, Mr. Frenzel.  The States 'agencies' testimony says that they, quote, "strongly oppose the Safe Children, Strong Families provisions that would cap Federal funding for caseworkers and training," which is what the gentleman from Maryland was referring to, even though that amount would grow every year.  Could you explain, perhaps in a letter to us, why the Pew Commission thought it was important to include these funds in the Safe Children, Strong Families grant and why capping it at a high and rising level makes sense, and maybe just briefly‑‑

Mr. FRENZEL.  I would be glad to do that, Mr. Chairman.

Chairman HERGER.  I don't know if you would like to, just very quickly if you‑‑

Mr. FRENZEL.  Sure.

Chairman HERGER.  Then extend that.

Mr. FRENZEL.  We believe that whatever our euphemism is, Strong Families‑‑anyway, nice people grant really provides the flexibility that States and local operating units need.  Some of them will be up to snuff in training and will be investing enough in training.  Some of them won't be doing enough training.  Some of them will want to put that money into other child welfare measures.  It may be preventative in nature.  It may save us a lot of money over the long haul.  We thought it was very important to make a big pot of that money flexible so that the States could do the things they were telling us they knew how to do very well.  I suppose there are a lot of administrators who would take the safe course and not want to lead off of first base, but I think that there are some out there who would like the flexibility and can perform well given it.  I will make this more coherent and comprehensible in a letter, Mr. Chairman.

Chairman HERGER.  I appreciate that.  Mr. Sipes, would you like to respond to that?

Mr. SIPES.  I can do that in a letter, as well, if you would like.

Chairman HERGER.  Would you like to briefly respond now?

Mr. SIPES.  Actually, let me do it in writing.  I would like to really sit down and give you a more complete‑‑

Mr. CARDIN.  Mr. Chairman, I assume the record will remain open for the responses to our questions?

Chairman HERGER.  Absolutely.  Without objection.  Again, we do have votes coming up.  I would like to thank each of our distinguished panel members for taking the time to appear today to help us review these child welfare reform proposals.  I appreciate your comments on these proposals as well as the draft legislation.  As I indicated earlier, it is my intention to work with other Members to incorporate helpful suggestions and introduce this legislation shortly.

However, as we all know, it is important that we do everything possible to agree on one common principle.  We must do more to protect these children.  We also should keep in mind that the budgetary climate in the future is likely to look much different, making it more difficult to find additional resources the longer we wait.  I encourage our witnesses and other interested parties to submit comments and engage with us throughout this process.  I would hope that we could take this opportunity to reach common ground on the best ways to improve how to protect children.  With that, this hearing stands adjourned.

[Whereupon, at 2:12 p.m., the hearing was adjourned.]
[Questions submitted by Chairman Herger and Representative Cardin to Hon. Frenzel, Dr. Arnold-Williams, Ms. Wilson, and Mr. Sipes, and their responses follow:]

Questions from Chairman Wally Herger to the Honorable William Frenzel

Question: The State agencies' testimony says that they "strongly oppose the Safe Children, Strong Families provision that would cap Federal funding for caseworkers and training" even though that amount would grow every year.  Can you explain why the Pew Commission thought it was important to include these funds in the Safe Children, Strong Families grant, and why capping it makes sense?

Answer: In the course of our deliberations, the Pew Commission heard repeatedly from state officials, child welfare professionals, and advocates that children would benefit if states – and specifically caseworkers – could use a greater proportion of federal funds more flexibly to tailor their casework to meet the needs of the individual children and families they serve.  The current federal financing structure makes this very difficult, since caseworkers can only use a small portion of federal dollars (Title IV-B) flexibly.

The Commission was also concerned that, because "admin" dollars are tied to foster care caseloads, as caseloads decline, federal funds for casework would also diminish.  The indexed Safe Children, Strong Families grant that we propose, with additional funds in its first year, is intended to protect and grow funds for casework and other services to children and families.

Many states and advocates have expressed concern that flexibility might come at a what they consider an unacceptable cost – a cap on the total amount of federal money available to states that may prove inadequate to meet children's needs.  The Safe Children, Strong Families Grant proposed by the Pew Commission tries to address states' need for flexibility, while also providing additional resources, and reliable funding in future years.  Specifically, it would:

• give states greater flexibility in how they can use nearly half of federal child welfare funds (about $3.1 billion in FY 2004);
• provide additional resources in the first year for states to increase their capacity to meet a wide array of needs; and
• ensure that the grant grows in future years so that states have a reliable, mandatory source of federal dollars to meet children's needs in a timely and appropriate way.

The grant extends the flexibility of Title IV-B to the administration and training components of IV-E.  This new flexibility would allow states to use a significant share of their federal child welfare funding for any child welfare purposes currently allowed under IV-B, except for foster care maintenance payments.  It would also give states broad flexibility to use their funds to train any personnel who are responsible for administering child welfare services.  Thus, training funds could be used to provide training for public and private child welfare employees and court personnel, guardians ad litem, or other court-appointed advocates.

Question: The Pew Commission report includes the following statement: "We also believe that the primary focus of new Federal spending should be on helping States develop the capacity to reduce an over-reliance on foster care use – rather than on foster care itself."  What led the Commission to conclude that States "over-rely" on foster care? What you're basically saying is that States are putting some children into foster care who with the proper supports and services do not need to not be in foster care, correct?

Answer: At the beginning of our work, the Pew Commission sought input from a wide and diverse array of experts and stakeholders ranging from former foster youth and foster parents to academics and statisticians, from lawyers and judges to front-line caseworkers and agency administrators.  To gather this input, we conducted focus groups, met with various organizations and put out a public "call for input" on our website. We also examined the data available through the Adoption and Foster Care Reporting System (AFCARS), the National Survey of Child and Adolescent Well-Being, the National Foster Care Data Archive and other sources.

The Commission recognized that children must first and foremost be safe.  Foster care provides this basic protection to children who cannot live safely in their own homes, and it should therefore always be available when there is no other way to keep a child safe.  For this reason, the Pew Commission recommended keeping foster care maintenance as an open-ended entitlement.

But we also heard time and time again that some children are in foster care who could be safely cared for in their own homes if the proper services and supports were available.  The data also clearly indicated that many children were spending multiple years in foster care, often in many different foster homes, group homes, or institutions because states lack the financial capacity to provide services and supports necessary to secure for them safe, permanent families.  The current federal financing structure – which conditions states' access to the great majority of federal dollars on the use of foster care and provides only relatively small amounts for other services – is a major contributor to this over-reliance on foster care. 

The Commission concluded that continuing the current open-ended safety net of foster care maintenance, with new dollars and incentives for other services and supports to vulnerable children, was the approach most likely to lead to reduced utilization of foster care while ensuring foster care remained an option when it is needed.

Question: What incentives does the Federal government provide today to move kids from foster care, or prevent their placement in foster care in the first place? 

Answer: Currently, the only Federal financial incentive to move children from foster care safely to permanent families is the Adoption Incentive bonuses ushered in as part of the Adoption and Safe Families Act in 1997 and reauthorized this year.  This program rewards states for increasing adoptions of children from foster care above specific baselines.  There are no comparable incentives to prevent the placement of children into foster care in the first place or to move them into other permanent settings, including returning home to their parents. 

The Adoption Incentive program clearly demonstrates what can happen when the Federal government aligns financial incentives with desired outcomes - "child welfare systems and communities can [and do] deliver." [1] The success of the Adoption Incentive program was a significant factor in the Commission's decision to recommend several strategies for incentivizing the desired outcomes, including the reinvestment of saved foster care dollars, making subsidized guardianship available as a permanency option, creating a broader permanency incentive, and creating a workforce incentive. 

Question: Has there been any reaction to your report from the Senate?  Have you been meeting with the Senate?  Do you have any sense that the other body is looking to act?

Answer: The Commission kept interested members of both the Senate and House informed of our work.  We believe there is strong interest in the Senate, but we are not privy to the specific plans of individual members or Committees.

Question: In Ms. Williams' testimony, she urges us to consider making the changes proposed an option for the States.  That is, if a State felt the current system better met their needs, they could keep the status quo.  In your report on page 19, you say "the Pew Commission decided from the beginning that it was not interested in "tweaking" the system."  Do you think giving States the option to change these programs is the way for us to proceed?

Answer: The Pew Commission considered a wide range of approaches to reforming federal child welfare financing to better meet the needs of children who have experienced abuse or neglect.  Because the fundamental problems and limitations in the current financing system applied to virtually every state, we recommended a comprehensive national approach to reforming federal financing.

At the same time, we were very cognizant of differences across states that might well lead different states to employ different policy responses.  For that reason, our proposal seeks to give states much greater flexibility in how they can use federal dollars, the option of subsidized guardianship as an additional route to permanency, and an expanded child welfare waiver program.

Question: Please comment about why the Pew Commission felt it important to broaden eligibility for Federal payments, and also to pay for that broadened eligibility by lowering the Federal rate.  I note Ms. Wilson expressed concern about "any proposal that involves a too severe reduction in the rate of the Federal share."  Could you address that concern and how the Pew proposal – and the draft bill – handles this?

Answer: The Pew Commission's recommendation to "de-link" federal payments from any income eligibility standard reflects the Commission's principle that every child who experiences abuse or neglect – not just every poor child – deserves the protection of both the federal and state governments.  The current "look back" to the 1996 AFDC income standard is unfair to children who need the protection of foster care; it is administratively burdensome and costly to states; and it results over time in a diminishing pool of children for whom states can claim federal reimbursement.

The Commission further concluded that, in a time of record federal deficits, new federal investments should be directed to preventing the need to put children in foster care and to helping children leave foster care as soon as they safely can.  For this reason, the Commission recommended a de-link approach that is cost neutral to both the federal government and the states, paired with a recommendation of new funding for the Safe Children, Strong Families Grant, subsidized guardianship, and new incentives for workforce improvements and permanence.

There are a variety of ways to de-link in a cost-neutral way.  The Commission report offers one such way.  Under our suggested approach to de-linking, states would receive the same amount of federal funding under a de-link as they would under the old system. Thus, each state will have the same amount of combined federal and state dollars to care for the same number of children; the only difference is that both the federal and state government will share in the cost of care for each child.

To remain cost-neutral, the mathematical effect is a reduction in federal reimbursement rates of about 35 percent.  However, because we also wanted to avoid creating fiscal winners and losers among the states through a delink, we recommended that every state receive exactly what it would have received under the current system – no less, no more. The practical effect of our proposal is therefore that states receive the same amount of money they would have received under the linked system, while allowing states to realize significant savings in administrative costs related to eligibility determinations.

[1] Fostering Results, Nation's Child Welfare System Doubles Number of Adoptions from Foster Care, October 2003, Child and Family Research Center, University of Illinois, Chicago, IL.

Questions from Representative Benjamin L. Cardin to the Honorable William Frenzel

Question: During your testimony, you specifically expressed concerns about capping Federal foster care maintenance payments.  

• Are you concerned that a cap reduces the ability of the foster care system to respond to spikes in the caseload for reasons beyond a State's control?
• Do you believe a contingency fund can adequately address this concern?  If so, how would you design it? 
• Furthermore, are you worried that a cap may reduce the Federal government's financial commitment to vulnerable children over time?  In other words, even if the cap is designed to grow, does it present a bigger target for future budget cuts than an open-ended entitlement?

Answer: The Commission stated strongly its conviction that every child who experiences abuse or neglect deserves the protection of both the federal and state governments.  Keeping foster care maintenance open-ended ensures such protection in the face of unexpected increases in the need for foster care stemming from circumstances beyond a State's control.  A quick look at the percentages by which foster care use rose during the "crack epidemic" of the 1990's demonstrates both the unpredictable nature of crises that threaten children's safety, as well as the great variability across states in factors that cause foster care use to increase.

At the same time, the Commission wanted to reduce foster care use whenever safely possible.  We concluded that incentives and an additional route to permanence (subsidized guardianship) are a more effective way to induce states to lessen their reliance on foster care than capping the amount of federal dollars available. 

We had concerns about both the adequacy of the TANF contingency fund as well as whether it could be accessed by states in a timely enough manner to help them respond to a child welfare crisis.  One possible alternative to the Chairman's proposed cap and contingency fund approach was discussed in our report:

Some observers of the child welfare system are concerned that incentives alone will not be sufficient to drive policy changes in some states.  If this proves to be the case after the incentives have been in place for a reasonable period of time, Congress may wish to consider a penalty in the form of a lower reimbursement rate for the marginal foster care expenditures that exceed projections.  Such a penalty would not be based on expenditures for any individual child – for example, based on the individual's length of time in care – but rather on the state's aggregate foster care use.  The decision to apply such a penalty would take into consideration whether factors beyond the control of child welfare policy makers – such as a sudden upsurge in drug use – were driving the increase in foster care use.  (Fostering the Future, p. 26.)

As the question suggests, concerns about the possible vulnerability to future budget cuts of a capped foster care program were among several of the reasons that the Commission recommended a combination of keeping IV-E foster care maintenance open-ended while putting IV-E Administration and Training in a capped grant that grows according to a formula.  We believed this was a reasonable compromise, providing states with a large, flexible and reliable pot of money for casework, services to children and training, while also providing the "safety net" of federal reimbursement for a portion of the cost of maintaining a child in foster care.

Question: There is a broad consensus that more resources are needed for prevention and family support services to reduce the need for foster care.  However, some have gone even further to suggest that the current child welfare financing system creates a perverse financial incentive to keep children in out-of-home care (because open-ended Federal matching payments are available for foster care). 

• Do you agree with this sentiment? 
• Doesn't every State actually save money when a child leaves foster care because they are required to pay for at least part of that care? 
• More importantly, do you believe individual caseworkers are making placement decisions for children based on whether that child is eligible for Federal maintenance payments?

Answer: The Pew Commission members did, indeed, see the current federal financing structure as creating "perverse incentives" that favor foster care over other services.  While it is true that states do pay for a portion of foster care, and thus can save money when a child leaves care, it is also true that states have an obligation to keep vulnerable children safe.  When the vast majority of federal dollars are directed to out-of-home care, and state matching dollars are also targeted in this direction, the result is to limit the options available to a state for ensuring the safety and well-being of vulnerable children. 

Individual caseworkers make decisions based on keeping children safe within the context of the resources available and accessible in their community.  Thus, an individual caseworker is unlikely to be thinking about a child's eligibility for Federal foster care maintenance payments. Nevertheless this payment structure drives the allocation of resources when funds for services are limited, as they are in the current financing structure, and this can indirectly influence casework decisions. 

Additionally, it is important to recognize that dependency courts bear the ultimate responsibility and authority for decision-making related to each child's individual case.  Judges, too, need to focus on the needs of the child and the available community resources, and not be limited by a child's Federal eligibility status.  This is one of several reasons that the Commissions' court and financing recommendations are integrally linked.

Question: The General Accounting Office (GAO) reports that high turnover rates among caseworkers, inadequate training, low salaries, and large caseloads all undermine the capacity of a State to respond to children and families in crisis. 

• In its current form, do you believe the Chairman's draft proposal does enough to improve the quality of the child welfare workforce?
• If not, what additional steps would you suggest?

Answer: Chairman Herger's draft legislation would enable states to use the Safe Children, Strong Families Grant to provide training to a wide range of professionals in the child welfare workforce, should they choose to do so.  The Commission's recommendations would do the same.

In addition, the Commission recommends incentive payments to states that make improvements in their child welfare workforce.  For states that meet and maintain certain workforce targets, the federal government would provide a one-percentage point increase in the match rate for the Safe Children, Strong Families Grant.  The enhanced match rate would provide an incentive for states to continue to make investments in two critical areas:  (1) improving the competence of the overall workforce and (2) lowering caseloads.  The Commission recommends that HHS convene a collaborative working group of state officials, professional organizations and researchers to review existing standards and recommend national standards for both worker competence and caseload size. 

It is our sincere hope that these important incentives, together with the other significant changes we have recommended including subsidized guardianship and continuing the open-ended entitlement for foster care maintenance, will find their way into the Chairman's bill.

Questions from Chairman Wally Herger to Dr. Robin Arnold-Williams

Question: On p. 2 of your testimony, you say "States that have worked hard to achieve a high IV-E penetration rate would be more negatively impacted by the adjustment in the Federal match rate and may in fact face a situation of receiving less Federal resources than under the current system." 

• This statement suggests that States are spending their time determining how to maximize Federal dollars as opposed to protecting children and providing services. Haven't States been asking for years for the Federal government to stop forcing them to determine eligibility based on outdated income requirements?  Wouldn't "de-linking" as proposed by Pew and the draft bill free more caseworker time and resources to monitor children and ensure they are being properly cared for?  Isn't that the point of all this – better protecting children?

Answer: APHSA and states have consistently supported an extension of the federal government's commitment for foster care and adoption to all children in out-of-home care, not just those from AFDC-eligible families.  Although an administrative burden is inherent in having to establish eligibility, the more important issue is that an equitable state and federal commitment would acknowledge that children come to the attention of the child welfare system due to the circumstances of abuse and/or neglect regardless of the income of their parents.  Additionally, states are required to achieve the same positive outcomes for all children, provide the same federally mandated protections, and are at risk of losses of federal funding, whether or not the federal government has participated financially in that child's case.  Given these factors, it is only reasonable that federal funds be provided for the care of all children in foster care. 

Question: At several points in your testimony you suggest that States would prefer a number of the changes suggested in our draft legislation, if only they were options for States, instead of a package deal together.  Isn't that what the Administration has been recommending?  What was the States' response to that? 

Answer: As APHSA understands the Administration's flexible funding proposal, it would be a state option.  Some states have expressed concerns with the provision in the foster care option that would require states to stay in the option for five years.  In light of the fiscal difficulties in the states, and the uncertainty related to the rising cost of child welfare, caseload dynamics and other factors, states should be able to opt out of the plan given that the protection of children is the paramount concern.  However, it is important to note that APHSA has not taken a formal position on the Administration's proposal to date pending specific legislation. 

State child welfare systems are at various stages of reform and their state fiscal situations vary.  Some states have experienced dramatic declines in IV-E eligibility claims in recent years, some have achieved reductions in foster care caseloads, some have seen increases, and some have operated waiver demonstrations.  In addition, states differ in the resources used to support their child welfare systems—some have used TANF, SSBG, Medicaid, and a host of state and local resources.  Therefore, states will need to engage in a complex calculation of whether to embrace any child welfare financing reform proposal or continue to operate under the entitlement structure. 

Question: What incentives does the Federal government provide today to move kids from foster care, or prevent their placement in foster care in the first place?  Under the Pew proposal and the draft bill, if States succeed in keeping kids out of foster care, they could reinvest these funds in more services to families.  Do you believe that States will not benefit from these types of incentives?

Answer: The federal government currently provides few incentives to move children from foster care (adoption incentive bonuses, waiver demonstration projects for subsidized guardianship) and relatively few prevention dollars.  State and local dollars are currently the primary source for services to prevent removal, provide in-home services and to move children to permanency once they enter foster care.  States have supported the idea of having the option to redirect federal revenue for maintenance payments into other child welfare services whenever foster care is reduced.  However, any legislation that does not provide for additional upfront funding to help states reduce foster care caseloads enough to realize savings will not help achieve this reinvestment strategy.  Additionally, states that have made this upfront investment already should not be penalized financially for having done so.  These states would reflect lower foster care expenditures during the years covered in the current baseline formula in H.R. 4856 and therefore, a lower baseline amount.  States are noting the increasing needs of the children that are in foster care, therefore, the rising costs of care for these children should also be taken into account.

There is also concern that combining service dollars with administrative and training dollars may result in less funds available for services.  States that begin with a lower than current administrative and training amount due to the baseline formula, and factors such as routine and renegotiated salary increases, legal agreements to increase the number of staff and legislative requirements on child welfare staffing will require that states first use these grant funds to attend to those pressing factors which would decrease the amount available for funding services.  The current structure of the Safe Children, Strong Families would leave states in the same bind of having fewer than needed federal resources for prevention and transition to permanency.

Question: In the APHSA document Crossroads:  New Directions in Social Policy, APHSA embraces two fundamental goals for child welfare financing reform.  First, there should be Federal financial participation in support of all children in the child welfare system.  And second, there should be increased flexibility in the use of Title IV-E funds.  The draft bill accomplishes both of these goals.  Given that, why would States want the option to continue to operate the current child welfare program?

Answer: As outlined in Crossroads: New Directions in Social Policy, APHSA does support federal financial participation for all children in the child welfare system and increased flexibility in the use of Title IV-E funds.  Additionally, Crossroads highlights APHSA's support for the maintenance of the open-ended entitlement under Title IV-E and categorical eligibility under Medicaid for all children in foster care, both of which are currently not provisions in H.R. 4856.

States are in very different places with respect to child welfare financing and a cap on funding may affect them differentially.  In some instances, current law may be preferable.  In preliminary analysis of the funding reforms proposed under H.R. 4856, a state that currently has a 75% penetration rate and a 50% FMAP rate for a population of 5000 children in foster care would receive a 5% reduction in federal match than if they were to continue to access federal funds under the current entitlement structure.  States need additional resources to meet the demands of the child welfare system and should not lose federal funding in order to eliminate the eligibility link to AFDC.

Questions from Representative Benjamin L. Cardin to Dr. Robin Arnold-Williams

Question: During your testimony, you specifically expressed concerns about capping Federal foster care maintenance payments.  

• Are you concerned that a cap reduces the ability of the foster care system to respond to spikes in the caseload for reasons beyond a State's control? 
• Do you believe a contingency fund can adequately address this concern?  If so, how would you design it?
• Furthermore, are you worried that a cap may reduce the Federal government's financial commitment to vulnerable children over time?  In other words, even if the cap is designed to grow, does it present a bigger target for future budget cuts than an open-ended entitlement?

Answer: Any projections made on the foster care caseload trends and expenditures must include both IV-E and non IV-E children.  Our reading of H.R. 4856 indicates that the projected national baseline for the cap is reflective of the IV-E eligible population alone.  This would be of concern given that when states merge IV-E and non IV-E caseload trends and expenditures, the baseline may be dramatically adjusted upward.  A cap on the amount of federal funds would limit the ability of some states to access federal funding for children currently in their child welfare system if the financial ceiling was surpassed, regardless of any spikes that may occur due to unforeseen circumstances. 

Given that the safety and care of every child in foster care is of greatest concern to both states and the federal government, a contingency fund should not be necessary.  The federal commitment should continue to support any increase in caseloads experienced by states.  APHSA has consistently supported an open-ended entitlement under Title IV-E to ensure the protections needed by all children in the child welfare system.  States do have some concerns that any capping of these critical funds may be susceptible to future budget cuts. 

Question: There is a broad consensus that more resources are needed for prevention and family support services to reduce the need for foster care.  However, some have gone even further to suggest that the current child welfare financing system creates a perverse financial incentive to keep children in out-of-home care (because open-ended Federal matching payments are available for foster care). 

• Do you agree with this sentiment? 
• Doesn't every State actually save money when a child leaves foster care because they are required to pay for at least part of that care? 
• More importantly, do you believe individual caseworkers are making placement decisions for children based on whether that child is eligible for Federal maintenance payments?

Answer: Timeframes in ASFA and in state public policy as well as the overall mission of child welfare overrule any perceived incentive to keep kids in foster care.  Federal IV-E funding covers only a portion of foster care costs and the state bears the bigger share of the overall costs.  Therefore, states do realize some cost savings when children are moved onto permanency.

Question: The General Accounting Office (GAO) reports that high turnover rates among caseworkers, inadequate training, low salaries, and large caseloads all undermine the capacity of a State to respond to children and families in crisis. 

• In its current form, do you believe the Chairman's draft proposal does enough to improve the quality of the child welfare workforce?
• If not, what additional steps would you suggest?

Answer: APHSA has serious concerns with the provisions in H.R. 4856 to limit the amount of federal support available for caseworkers and the training needed to support their work.  Given the structure of the Safe Children, Strong Families grant as outlined in the bill, the need for resources to ensure a quality workforce may negatively affect the amount of funding available for the needed services to children and families.  Additional steps should include federal financial participation for private agency casework staff.  In some states, private agency staff account for a large portion of professionals providing services for children in foster care.  These professionals require the same administrative and training supports in order to effectively serve the same population of children that their counterparts in state positions serve.

Questions from Chairman Wally Herger to Ms. Patricia Wilson

Question: How many children are in foster care today, compared with 1980?   Is the Child Welfare League of America committed to helping States reduce the number of children in foster care?  What specific efforts are you pursuing toward that goal?

Answer: In 1980, there were 302,000, children in foster care. That actually represented a decline from ten years earlier when 326,000 were in foster care. As you know, there were some dramatic caseload increases in the 1980s due to the impact and spread of the crack cocaine epidemic. In the three most recent years, however, the trend has been declining. In 1999, 567,000 children were in foster care. The 2000, 542,939 children were in foster care, and in 2001 the number of children in foster care declined even further to 540,563.

CWLA has many ongoing efforts aimed at reducing the number of children in foster care. We assist our nearly 1,000 member agencies across the country in addressing the issue of foster care, as well as all other child welfare services.

Through its training, technical assistance, and development and dissemination of practice tools to member agencies who provide child welfare services, CWLA supports efforts to help states reduce the foster care population. CWLA also engages in strategic coalitions to aid in the reduction of the number of children and youth in foster care. These efforts include but are not limited to:

Community Support and Family Stabilization

To prevent placement into the child welfare system, CWLA works with communities in advocating for:

• Increased funding for family preservation and family support.
• Funding for comprehensive family substance abuse treatment.
• Securing additional services for families receiving public assistance.
• The creation of the Parenting-Rich Community Initiative so parents have the resources they need to support optimal development of their children.
• The extension of grants to support innovations in state child protective services and community-based preventive services.
• Improved mental health services to children and families.

In addition to working with communities, CWLA has provided:

• Educational sessions for homeless families in collaboration with member agencies in various cities.
• Trained professionals to develop local partnerships between child welfare agencies and public housing authorities.

Care of Children in Child Welfare

While children are placed in the child welfare system, CWLA advocates for:

• Collaboration of national organizations, individuals, youth, families and other stakeholders to address the mental health and substance abuse needs of children and families involved in the child welfare system.
• Funding of comprehensive family substance abuse treatment.
• The continued bonuses to states that increase the number of children adopted from foster care, with an emphasis on older children.
• The increase of adoptions from the foster care system, through collaboration with the AdopUSKids campaign.
• The identification of promising program models that focus on permanency.
• Funding federal grants for demonstration projects that eliminate the barriers to adoption facing children with special needs.

Permanency Options for Children and Youth

CWLA seeks permanency options for children and youth involved in the child welfare system by:

• Developing kinship care resources, such as the development and dissemination of a resource booklet covering the complicated financial issues facing kinship caregivers.
• Placing practice emphasis on youth in the foster care system.
• Addressing permanency for older children and youth in care.
• Convening meetings of the National Foster Youth Advisory Council to support youth leadership among youth in the child welfare system.

Reunification and Post Placement Services

CWLA advocates for increased funding to prevent re-entry into the foster care system.

• CWLA worked with the New York City Housing authority to develop and maintain employment, youth development, housing, child care services, and other community supports for families.
• CWLA trained professionals to develop local partnerships between child welfare agencies and public housing authorities
• CWLA formed partnerships with member agencies to provide information to communities that serve children and families
• CWLA advocates and supports funding for services to families who have adopted children from the foster care system or are kinship caregivers of children from the child welfare system. Funding to sustain and support these families is critical.

Workforce Issues

CWLA has addressed the workforce issues in the child welfare system by:

• Presenting teleconferences to members on the workforce issues.
• Advancing research on the issue of workforce.
• Offers practical recruitment and retention strategies for public and nonprofit agencies.
• Advocating for new federal funding for states to help relieve a shortfall in many state budgets.
• Publishing and disseminating program and practice resources for professionals in the field.

Overrepresentation

CWLA is addressing the overrepresentation of children of color in the child welfare system by:

• Creating CWLA'S Statement on Children of Color in the Child Welfare System, which provided a set of proposed action steps.
• Providing technical assistance to agencies on cultural competence of their workforce.
• Works in partnership with other coalitions to develop an action agenda addressing the disproportionate representation of children of color in the system.

Standards of Practice

Throughout the years, CWLA has established standards of practice, including caseload standards, in the following areas:

• Adoption Services
• Child Day Care Services
• Family Foster Care Services
• Health Care Services for Children in Out-of-Home Care
• In-Home Aide Services for Children and Their Families
• Kinship Care Services
• Management and Governance of Child Welfare Organizations
• Residential Services 
• Services for Adolescent Pregnancy Prevention, Pregnant Adolescents, and Young Parents
• Services for Abused or Neglected Children and Their Families
• Services to Strengthen and Preserve Families with Children
• Transition, Independent Living, and Self Sufficiency Services

Question: You contend that "the basic safety net of Federal support offered through the Title IV-E program would be compromised by capping the amount of assistance available to States" as proposed in our draft legislation.  For the record, how does the current system -- which provides no incentives to move children from foster care more quickly because of unlimited funding -- better protect these children?  All the States have failed their child welfare reviews, which shows they are not adequately protecting children.  Why would allowing States to collect additional Federal money for each added child do anything to encourage States to avoid more foster care placements?

Answer: CWLA shares with you the goal to reduce the number of children who are abused and neglected and thereby also reducing the need for foster care.

Merely capping federal funding for foster care, however, will not achieve that goal. We believe that the best way to reduce the need for foster care is to adequately fund prevention and other supportive and family strengthening services and to address the key components of the child welfare system, such as workforce competencies, training, and caseloads.

Title IV-E foster care assistance, as currently structured, does not offer states an incentive to place more children in out-of-home care. We offer several observations that underscore this point:

• Due to the current income eligibility restrictions, many children in foster care currently receive no federal assistance and are supported by state funds only.

The number of children in out-of-home care between 1999 through 2001 has decreased by a total of approximately 24,000 children, while children in foster care covered by federal funding under the Title IV-E program declined by approximately 38,000. That is a decline of 4.3% in overall placements compared to a 12.5% decline in federally subsidized placements. That reveals a cost shift that has reduced federal support for foster care and has resulted in an increase in foster care costs to state and local governments.

• Title IV-E federal foster care funds represent less than half the federal funds being used for foster care. For example, a review of states' use of the federal funds they receive from the Social Services Block Grant (SSBG) over the past several years demonstrates that states continue to use SSBG funds for foster care. States make this choice despite the ability to use the same funds for prevention and other supportive services. Approximately 37 states spent more than $270 million annually in SSBG funding over the past few years to pay for foster care. A recent GAO report also found that despite federal restrictions, some states were also using their Title IV-B Child Welfare Services funds for foster care. As current eligibility standards become more outdated and eroded by inflation, the pressure to use more flexible funding sources for such basic services as foster care maintenance and adoption assistance payments will place greater pressure not to use flexible funds for prevention or other services, but for out-of-home care.
• Avoiding foster care placements saves the states funds, as well as the federal government, since federal funds provided to states for federal foster care assistance through Title IV-E must be matched by a commitment of state funds. For California, Maryland and New York, that share is fifty percent.

The issues that need to be tackled in order to reduce the need for foster care are complex. They include adequate child welfare staffing and caseload sizes, training and the need for on-going training, access to services such as mental health and substance abuse—both in at home and out-of-home settings, prevention and intervention, and a number of other elements that make up the entire child welfare system.

The Child and Family Services Review process has highlighted many of these issues. A review of 33 state Program Improvement Plans (PIP) submitted to HHS show that states are facing a number of common challenges. Of the 33 PIPs reviewed, 13 states specifically addressed the need to reduce caseload sizes for their workers. Thirty of the 33 addressed the need to improve training. Other states cited turnover rates as an issue to be addressed and over half of the PIPS reviewed cited management issues as a need for improvement.

All of the PIPS reviewed addressed the need to improve the availability of services in some way, including mental health services, substance abuse treatment, general health care issues, and system reforms. Nineteen states include the need to better address the needs of those children who are "aging out" of the foster care system. These are some of the issues that need to be addressed to reach the goal of reducing the number of children in foster care.

Question: Your testimony does not mention that our draft legislation is paid for, including through offsets included in the House-passed welfare reform bill, which has failed to move in the Senate.  Do you have any comments on that?  Are any of the other bills you express support for in your testimony paid for? 

Answer: CWLA appreciates the urgency to address the mounting federal deficit of more than $400 billion. Congress certainly faces a challenging time in which to set its priorities and make budget decisions.

We believe that it would not be fair to hold investments for children hostage to future deficit reduction plans. Over the course of next several months Congress may consider the extension of tax deductions that will total $30 to $400 billion, a reauthorization of a transportation bill, the creation of a fund to address the phase-out of tobacco farming, needed increases in education funding, our growing defense needs, the cost of military action overseas and many other important proposals. Congress may decide to offset these costs or to approve them without a specified source of funding. We would expect that Congress also recognize that the needs of abused and neglected children should also be a top priority.

The legislation we support in our testimony does not include offsets as currently written. They do, however, address some of the critical elements we have raised, including the need to assist states in implementing their PIPs, the need for a national strategy on workforce, correction of the current eligibility under Title IV-E, and enhanced prevention and support services through a fully funded Promoting Safe and Stable Families program. Again, we highlight the fact that ultimately Congress must set and act on national priorities. We believe that addressing the needs of children should be one of those top priorities.

Questions from Benjamin L. Cardin to Ms. Patricia Wilson

Question: During your testimony, you specifically expressed concerns about capping Federal foster care maintenance payments.  

• Are you concerned that a cap reduces the ability of the foster care system to respond to spikes in the caseload for reasons beyond a State's control? 
• Do you believe a contingency fund can adequately address this concern?  If so, how would you design it?
• Furthermore, are you worried that a cap may reduce the Federal government's financial commitment to vulnerable children over time?  In other words, even if the cap is designed to grow, does it present a bigger target for future budget cuts than an open-ended entitlement?

Answer:

• CWLA has serious concerns about the impact of a cap on Title IV-E for foster care maintenance funds. We share the goal of the Subcommittee to reduce the number of children in foster care, but believe that this goal will not be achieved by simply limiting federal foster care assistance. As we responded in question two, what is needed to reduce foster care caseloads is adequately funding for prevention and other supportive and family strengthening services and addressing the systems issues such as workforce competencies, training, and caseloads.
• CWLA believes that the proposed contingency fund will not adequately address an unanticipated need. Many have highlighted the dramatic increase in foster care caseloads during the late 1980s and early 1990s as a result of the crack-cocaine epidemic. While we hope a similar experience such as the spread of the methamphetamine would not have a similar impact, it would be unwise to leave the nation unprepared.

As proposed in the Chairman's bill, states would have the option to draw from the existing Contingency Fund for State Welfare Programs. This emergency fund was created to address TANF cash assistance caseload increases. To qualify for this additional funding, a state must have spent all of its federal foster care funds and meet the definition of "severe foster care crisis." There are two ways to meet the "crisis" definition: (1) a state must have experienced a statewide average of 15% increase in its foster care caseload from the previous year and national foster care caseloads must have increased 10%; or (2) a state's foster care caseload increased by 20%. To determine caseload increases, the state must compare the most recent six-month period to the corresponding six-month period in the previous year.

This formula does not address the need for increased federal foster care assistance if the increase is limited to a specific urban area or single state. It also leaves out any consideration of increased costs in care as opposed to increased numbers of children in care.

In addition, a contingency fund that is designed to address the needs of the TANF population may create some unappealing choices for state human service programs. Any contingency fund would have to be designed to respond to the needs of the child and the number of children in need of protection. To adequately protect these children this fund could not have an artificial cap and could not be dependent on an annual appropriation.

• CWLA is concerned about the stability of funding over time for federal block grants. It is unclear if Congress would sustain even a level amount of funding for foster care over time. The history of one of the largest and most flexible block grants—SSBG—is not encouraging. SSBG was converted from an entitlement fund to a block grant to the states and funding for SSBG has not kept pace. SSBG funding was $2.8 billion in 1995, reduced several times from 1996 through 2000 and is currently funded at $1.7 billion. Congress reduced funding for SSBG to offset other priorities, including overall deficit reduction and to provide increased funding for transportation.

Question: There is a broad consensus that more resources are needed for prevention and family support services to reduce the need for foster care.  However, some have gone even further to suggest that the current child welfare financing system creates a perverse financial incentive to keep children in out-of-home care (because open-ended Federal matching payments are available for foster care). 

• Do you agree with this sentiment? 
• Doesn't every State actually save money when a child leaves foster care because they are required to pay for at least part of that care? 
• More importantly, do any of you believe individual caseworkers are making placement decisions for children based on whether that child is eligible for Federal maintenance payments?

Answer: This is an important question because it deals with a strongly held belief by some that funding sources drives the decision to remove children from their homes.

As we pointed out in question two, in the last three years the overall number of children in out-of-home care subsidized by federal Title IV-E foster care funds has decreased by a higher percentage than the overall reduction in out-of-home placements. A simple conclusion would suggest that out-of-home placements funded through state dollars or flexible federal dollars would go down at a faster rate than federal Title V-E funded children. This is not what happened and it hasn't happened because the decision to remove a child is much more complex and effected by multiple factors.

Question: The General Accounting Office (GAO) reports that high turnover rates among caseworkers, inadequate training, low salaries, and large caseloads all undermine the capacity of a State to respond to children and families in crisis. 

• In its current form, do you believe the Chairman's draft proposal does enough to improve the quality of the child welfare workforce?
• If not, what additional steps would you suggest?

Answer: CWLA believes that national leadership and support is needed to truly address the current crisis in the child welfare workforce. Better supports for the workforce need to be a critical component of any comprehensive child welfare reform measure.

The Chairman's bill would cap Title IV-E training funds and place those funds into a block grant to states to be used for administration, training, and services. These funds are used to prepare social workers for the job of working with the courts; working with other social service providers; creating treatment plans for children and families; and achieving permanency for children, ranging from reunification to guardianship to adoption.

In the Chairman's proposal, no funding for training would be guaranteed. While including these funds in a block grant would give states more flexibility with the use of the funds, it also means that states would be faced with pitting the training needs of staff with the need to provide services to children and families. This is a choice that no state should have to make.

CWLA feels that proposals included in H.R. 1534 and H.R. 2473, that provide funding for a comprehensive strategy with outcomes and measures tied to workforce development are a better solution. These bills also provide loan forgiveness for workers and expand access to training funds as part of this national strategy.

Last fall, the Subcommittee focused its hearings on the state of New Jersey and the conditions in its child welfare system, which had been highlighted in the national media. New Jersey has since adopted a comprehensive reform plan. A major portion of that plan deals with workforce improvements. New Jersey's experience offers an important national perspective. As stated in New Jersey's reform proposal, "Child welfare casework may not be rocket science or brain surgery—in some cases it may be harder."

New Jersey's plan indicates the need for adequate staffing. Over the next two years New Jersey intends to hire an additional 416 child protection and permanency workers, 48 casework supervisors, 136 adolescent specialists, and 191 new resource family support workers. Through the end of last year New Jersey had already added an additional 253 workers bringing the workforce total to nearly 2,000 workers. In order for New Jersey to implement its full plan, the state legislature has just approved a funding increase of $125 million for fiscal year 2005. That is in addition to its current budget of $520 million. The Governor has also proposed $180 million more in 2006. These proposals stand in contrast to the level of new federal investments included in the Chairman's legislation.

Question: What is the Child Welfare League of America's position on consolidating certain funding steams, including open-ended funds for administration, into a new capped grant that includes additional resources compared to CBO's baseline (as proposed by both the Pew Commission and the Herger Draft)?

Answer: CWLA has serious concerns about the impact of including Title IV-E administration into a block grant. Title IV-E administration provides funding for activities directly related to achieving safety and permanency for children in foster care. Capping the amount of federal funding a state can receive for that activity could make it more difficult to achieve those outcomes. Any reform proposal that moves forward, must ensure that funding that supports social work staff and is used for case management are guaranteed.

Question from Chairman Wally Herger to Mr. Samuel Sipes

Question: What do you believe is the single biggest factor today that prevents States from better protecting kids in care?  Do you believe the current child welfare system provides the proper distribution of resources, in terms of services and out-of-home placements, to protect children and strengthen families? What incentives does the Federal government provide today to move kids from foster care, or prevent placement in foster care in the first place? Right now when the foster care caseload falls, it could mean fewer Federal dollars for States.  We know the caseload has been falling since 1999.  However, the draft bill proposes a guaranteed and rising level of funding for foster care for the next 10 years.  If States succeed in keeping kids out of foster care, they could reinvest these funds in more services to families.  Do you believe that States, and more importantly children, will benefit from these types of incentives?

[Submissions for the record follow:]

Alliance for Children and Families, Carmen Delgado Votaw, statement

Child Protection Reform, Minneapolis, MN, J. Holderbaum, statement

Children's Law Center of Los Angeles, Monterey Park, CA, Miriam Aroni Krinsky, statement

Children's Rights, New York, NY, Marcia Robinson Lowry, statement

County Welfare Directors Association of California, Frank J. Mecca, Sacramento, CA, statement

Duranceau, Paula, Benton City, WA, statement

Huckelberry, Cynthia, Redlands, CA, and Sushanna Khamis, Yucaipa, CA, statement and attachment

Institute for Human Services Management, Baltimore, MD, Tracey Feild, statement

National Center for Youth Law, Oakland, CA, William Grimm, statement

National Indian Child Welfare Association, Portland, OR, Terry L. Cross, statement

New York State Office of Children and Family Services, Rensselaer, NY, John A. Johnson, statement

Seita, John R., Battle Creek, MI, statement and attachment

Volunteers of America, Alexandria, VA, statement