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FY 2004 Bush Budget and Children
Child Welfare
Child Welfare Financing Reform
The President's FY 2004 budget suggests that a legislative proposal will be developed that will establish a new child welfare financing option. The Administration's budget documents, and subsequent Congressional testimony by Tommy Thompson, Secretary of the U.S. Department of Health and Human Services (HHS), at a Congressional hearing on 2/6/03, offer only an overview of the proposal. Many details of the proposal are still unknown.
The budget documents indicate that the proposal:
- "…would allow States to move to an alternative system for foster care to better meet the needs of their child welfare populations. States choosing to participate will receive funds in the form of flexible grants, which will serve as an incentive to create innovative child welfare plans with a strong emphasis on prevention and family support. Participating States will also face fewer administrative burdens. Under the flexible funding plan, States will be required to continue to uphold the child safety protection outlined in the Adoption and Safe Families Act, agree to maintain existing levels of State investment in child welfare programs, and continue to participate in the Child and Family Service Reviews. The proposal provides access to the TANF Contingency Fund from which States may receive additional funding under certain circumstances if a severe foster care crisis were to arise. A $30 million set-aside will be available for Indian tribes, and a one-third of one percent set-aside will be available for monitoring and technical assistance of State foster care programs."
- The budget further indicates:
- "State flexibility will be coupled with accountability-by holding states to high standards of performance-to ensure the best outcomes regarding safety, permanency, and well-being for vulnerable children and their families. Participating states will be required to continue to: maintain the child protections outlined in the Adoption and Safe Families Act, agree to maintain existing levels of state investment in child welfare programs, and conduct an independent third party evaluation of their programs."
HHS Secretary Thompson testified before the House Ways and Means Committee on 2/6/03. His testimony provided only a few additional details:
"This plan would allow States to choose a fixed allocation of funds over a five-year period rather than the current entitlement funding for the Title IV-E Foster Care program… States which elect this option and experience emergencies affecting their foster care systems may access additional funding from the TANF contingency fund."
Foster Care
The Administration's budget projects that Title IV-E Foster Care mandatory spending will increase to $5.0 billion. This is an increase of $238 million from FY 2003 and is expected to also fund the child welfare finance option described above. The funds will be used for maintenance payments and administrative costs for approximately 240,600 children each month. In addition, states use these funds for training and for the operation and development of the Statewide Automated Child Welfare Information Systems (SACWIS), a computer-based data and information collection system.
Adoption Assistance
Federal Adoption Assistance mandatory spending is projected to increase to $1.7 billion, an increase of $80 million over 2003 costs. These funds will be used to provide maintenance payments to adoptive families, administrative payments for the costs associated with placing a child in an adoptive home, and training professionals and adoptive parents. The proposed level of funding will support approximately 348,700 children each month.
Independent Living
The budget contains $200 million for the Independent Living Program. This includes $140 million in mandatory funds, the same as the FY 2003 request, for a variety of services to ease the transition from foster care for youth who will likely remain in foster care until they turn 18 and former foster children between the ages of 18 and 21. Approximately 20,000 young people leave foster care each year at their 18 birthday.
- Independent Living Education and Training Vouchers
- $60 million of the total funding for Independent Living is proposed for the Education and Training Voucher program that was authorized in 1999 (P.L. 106-169). The program was funded for the first time in FY03 at $42 million. The voucher program will help older youths leaving foster care get the higher education, vocational training, and other education supports they need to move to self-sufficiency. Up to $5,000 per year will be available to a young person for the cost of attendance. This program expands on states' efforts to provide these services. Currently seventeen states provide education and training assistance for college or vocational training to youth leaving foster care.
Promoting Safe and Stable Families
The President's budget proposes funding the Promoting Safe and Stable Families (PSSF, Title IV-B, Subpart 2) program at $505 million. This figure represents full funding with $305 million in mandatory (guaranteed) funding and an additional $200 million in discretionary funds that require Congressional approval.
Children of Incarcerated Parents
The Administration requests $50 million for a program that provides mentoring for children with incarcerated parents. This program was authorized in the Promoting Safe and Stable Families Amendment Act of 2001 (P.L. 107-133) and funded for the first time at $10 million in 2003. This is a competitive grant program providing grants up to $5 million each.
Child Welfare
Under the President's budget, funding for several other child welfare programs would continue at current levels, including Child Welfare Services (Title IV-B, Subpart I), $292 million; Child Abuse Prevention and Treatment Act (CAPTA) state grants, $22 million; CAPTA discretionary grants, $26 million; Adoption Opportunities grants, $27 million; and Adoption Incentive Payments to states, $43 million.
Social Services Block Grant (Title XX)
The President proposes to fund the Social Services Block Grant (SSBG) at its current level of $1.7 billion. The budget would also permanently restore the amount a state can transfer from the Temporary Assistance for Needy Families (TANF) program to SSBG to 10%. States are able to transfer only 4.25% from TANF to SSBG, but each year Congress temporarily allows states to transfer up to 10%. In FY 2000, $816 million of the SSBG funds were spent on services to children and youth, including adoption, foster care, child protection, independent living, and residential services.
Child Care
The Child Care and Development Fund (CCDF) is made up of both discretionary and mandatory child care dollars. The "mandatory" or guaranteed funding is now $2.7 billion. Of this total, approximately $1.6 billion flows to the states by formula if a state puts up state dollars as a match. The remaining funds are provided to states without a required match. The President proposes no increase in discretionary child care funding for FY 2004. The Child Care Development Block Grant (CCDBG), the discretionary portion of the child care fund, is currently funded at $2.1 billion.
Congress considered proposals, but was not able to complete action, on legislation to reauthorize child care in 2002. The Administration's reauthorization proposal, as packaged along with TANF, proposes no increase in child care funding for the next five years. The Administration's proposal would continue discretionary funding at the current level of $2.1 billion and also continue the mandatory funding of $2.7 billion for five years.
The demand for child care, however, continues to grow. In 1999, only 12% of all potentially eligible children were receiving CCDF subsidized child care. With tight state budgets, current child care funding at the state level could be forced to absorb cuts. The Administration's budget proposal, as documented by a recent analysis by the Center for Law and Social Policy and the Center on Budget and Policy Priorities, demonstrates that by the Administration's own projections, the number of children served through the child care block grant will decrease by 200,000 by 2007.
The Administration also calls for eliminating funding for the Early Learning Fund. In FY 2002, this program was funded at $25 million. The program funds efforts to coordinate child care and other early education initiatives and has had the strong support of key members of Congress in recent years.
Head Start
The President's budget increases Head Start funding by $148 million, bringing total funding to $6.8 billion. This increase does not keep pace with inflation once funds are set aside for Early Head Start and services targeted to enhance the quality of programs.
The Administration proposes to shift the emphasis of the Head Start program from the development of a child's social, emotional and physical development to a focus on developing a child's literacy abilities. Reflecting that change, the Administration proposed moving the administration of Head Start from the U.S. Department of Health and Human Services to the U.S. Department of Education. This move would begin in 2004 and be completed in 2005.
In another significant change, the President proposes to shift funding to the states. The budget indicates it would, "…provide states with the opportunity to exercise more control over Head Start, so that they can better coordinate with state pre-school and other preparatory programs." From the description in the budget documents, it is unclear how funding for Head Start would be administered under this proposal. Information released by the U.S. Department of Education suggests that control of Head Start funding, which now flows from HHS directly to local programs, could go to states, and funds could be shifted away from the current population of children and families and be used to subsidize a states education or child care system.
Temporary Assistance for Needy Families (TANF)
The President's FY 2004 budget continues the recommendations made in the President's FY 2003 budget concerning TANF reauthorization. Since Congress did not complete action on TANF reauthorization legislation in 2002, it will again be considered this year. The budget indicates the Administration will seek level funding for TANF, including a base amount of $16.5 billion in TANF funds to all 50 states, and approximately $319 million in supplemental grants to 17 states.
The budget indicates that the President's central focus will be on the work requirements in the current TANF law and will emphasize the need to promote marriage. Again, the Administration will propose increasing current work requirements to 40 hour per week, increasing the percentage of a state's cash assistance caseload who must be in work, and spending $1 billion over five years on marriage promotion.
Fatherhood Initiatives
The Administration proposes legislation to establish the Responsible Fatherhood and Healthy Marriages Program. The program would be funded at $20 million with grants going to community- and faith-based programs to assist non-custodial fathers.
Community- and Faith-Based Initiative
Currently funded at $30 million, the Administration requests $100 million for the Compassion Capital Fund. These grants are used to finance start-up costs for charitable organizations.
Behavioral Health
The President is proposing $3.4 billion in FY 2004 for the Substance Abuse and Mental Health Administration (SAMHSA), to improve the quality and availability of prevention, early intervention, treatment, and rehabilitation services in order to reduce illness, death, disability, and cost to society resulting from substance abuse and mental illness. This is a net increase of $204 million.
Substance Abuse
Meeting the treatment needs of people who are currently substance dependent is a major priority in the President's budget, and a new state voucher program is proposed. In FY 2004, new funds will be available for SAMHSA to administer this new drug and alcohol treatment voucher initiative. The purpose of the initiative would be to assist more individuals in obtaining drug and alcohol treatment services by increasing treatment capacity and consumer choice by broadening the base of treatment providers to include proprietary and faith-based providers. The goal of the program would be to expand treatment for an additional 100,000 individuals per year. The Center for Substance Abuse Treatment (CSAT) at SAMHSA would administer the new program, which would provide $200 million per year for three years for competitive grants to 15-25 states for vouchers.
Funding for the Substance Abuse Performance Partnership Block Grant is increased to $1.785 billion, after a cut of $22.2 million in FY 2003. The Substance Abuse Treatment Programs of Regional and National Significance are increased to a funding level of $557 million. The Substance Abuse Prevention Grants, however, will receive an additional cut of $50.3 million for a total of $148.1 million for FY 2004. In all, substance abuse programs will receive federal funds of $2.49 billion, a $194 million increase, if the President's budget is approved as is.
Abandoned Infants Assistance
The Abandoned Infants Assistance (AIA) Program would receive a small increase of $11,000 for FY 2004, for a total of $12.205 million. This program provides demonstration grants for services to infants and young children, many of whom are HIV-infected or drug-afflicted. These infants and young children are medically cleared for discharge from acute hospital settings, but remain hospitalized due to a lack of appropriate out-of-home placement alternatives.
Mental Health
The President's budget includes $834 million for mental health activities for FY 2004. In FY 2003, CMHS received $862.1 million. The Mental Health Services Block Grant for states to provide community-based care for adults and children is funded at $433 million. The Children's Mental Health Services Program received an increase of $8 million for a total of $107 million. SAMHSA's Mental Health Programs of Regional and National Significance are reduced once again to $212 million. In FY 2003, the program was funded at $246 million.
Health
Medicaid/SCHIP
Medicaid provides a vital health care safety net in every state. It is a lifeline to health care for children, people with disabilities and chronic illness, and low-income elderly people. To broaden coverage to low-income children, Congress enacted the State Children's Health Insurance Program (SCHIP). SCHIP targets uninsured children under 19 with family incomes below 200% of poverty who are not eligible for Medicaid or covered by private insurance.
The budget request projects Medicaid mandatory spending to be $162 billion for FY 2003 and $176 billion for FY 2004. SCHIP funding for FY 2003 was $4.7 billion and is projected to be $5 billion in FY 2004.
Medicaid Block Grant Proposal
In the FY 2004 budget request, the President proposes a "sweeping new plan" to redesign the state-federal partnership that now exists in the Medicaid and SCHIP programs. The future viability of these programs is at stake. States would be given the option of continuing their current Medicaid programs without additional federal financial assistance or transforming their Medicaid and SCHIP into a single capped, consolidated block grant. The proposal does allow for state flexibility, with additional federal funding in the form of a loan to states to assist in tight budget times, but only if states agree to a capped allotment.
The proposal would provide states participating in the block grant with an additional $3.25 billion in FY 2004. For the first seven years, a total of $12.7 billion in additional federal funds would be available. It is unclear whether the entire amount will be available if not all states participate. It also appears to be a loan that states will have to pay back. (In contrast, a proposal in the Senate to increase the federal Medicaid FMAP, the federal share of Medicaid costs, would provide states with a temporary increase of $10 billion through June 2005; a House FMAP proposal would provide states with $8 billion over 12 months.) States would have to agree to accept two allotments or block grants - one for acute care and one for long-term care. A state would not be able to get federal matching funds for any expenditure that exceeded its allotment.
The proposal would merge children's Medicaid and SCHIP coverage into one acute care block grant. All SCHIP enrollees - over 4 million children since 1997 - as well as all children currently covered by Medicaid could be affected by this proposal. In addition, 3.7 million parents receiving Medicaid as "optional" beneficiaries could be affected.
Further, Medicaid currently requires Early and Periodic Screening, Diagnosis and Treatment (EPSDT) services for all children. States opting for the block grant could eliminate the protections of EPSDT for "optional" children. It is unclear whether EPSDT would be part of the "comprehensive" benefit package HHS would require for mandatory populations.
Family Planning
The Family Planning (Title X) program supports a network of more than 4,500 clinics nationwide serving 4.8 million people. The FY 2004 budget request includes $265 million. Family Planning clinics provide access to a wide array of reproductive health and preventive services. In FY 2003, Title X was funded at $275 million.
Abstinence Education
The President's budget includes a substantial increase in abstinence education for FY 2004, a total of $136 million. The Community-Based Abstinence Education program, administered through the Maternal and Child Health Block Grant's Special Projects program, would be funded at $73 million. In FY 2003, it was funded at $55 million. This program provides grants to public and private entities for the development and implementation of abstinence-only education programs for adolescents, ages 12 through 18.
Also, mandatory funding for the Abstinence Education Grants to states in the amount of $50 million will continue. This program provides grants to 59 states and territories to provide mentoring, counseling, and adult supervision targeted on those groups of youth who are most at-risk. In addition, the Adolescent Family Life Program (AFL) will receive $12 million for abstinence-only activities, an increase of $3 million.
Maternity Group Homes
As last year, the Administration is asking for $10 million for Maternity Group Homes, more commonly referred to as Second Chance Homes. These homes are supervised, nurturing residences for teen mothers and their children. They provide the support teen mothers need to become self-sufficient and be good parents, with such services provided as child care, education, job training, counseling, and advice on parenting and lifeskills. No funding was provided for this program in FY 2003.
Maternal and Child Health
Title V of the Social Security Act, the Maternal and Child Health Services Block Grant, is increased in the FY 2004 budget request by $19 million for a total of $751 million. In FY 2003, Title V was funded at $735 million. The block grant supports federal and state partnerships that provide critical services to 27 million women and children. These services include direct health care services for children with special health care needs, the promotion of health and safety in child care settings, and enabling services such as home visiting and nutrition counseling. It also provides support for newborn screening, trauma care, and injury prevention. The budget request also proposes $99 million for the Healthy Start program. The Healthy Start program supports community-driven programs to reduce low-birthweight and inadequate prenatal care, both conditions that contribute to infant mortality.
HIV/AIDS
The FY 2004 budget request includes $2.01 billion for the Ryan White HIV/AIDS program. In FY 2003, this program was funded at $2.031 billion. The Ryan White program provides HIV medical care and related supportive services to individuals with HIV/AIDS, including early intervention services to underserved communities. The budget also calls for a $100 million increase for the AIDS Drug Assistance Program (ADAP) that will support purchasing medications for over 9,000 additional persons living with HIV/AIDS.
National Violent Death Reporting System
The Centers for Disease Control and Prevention's (CDC) Injury Prevention Center is funded at $149 million. The National Violent Death Reporting System (NVDRS) is listed as a priority program for FY 2004. NVDRS collects data on deaths and injuries caused by firearms, suicide, and child abuse.
Children with Disabilities
Under the Individuals with Disabilities Education Act (IDEA), the Early Intervention Services Program (Part C) would be funded at $447 million in FY 2004. Under IDEA, the U.S. Department of Education works with states to ensure that children with disabilities receive an appropriate public education that includes preparing them for employment and independent living, and that all schools are held accountable for the educational results of children needing special education. The CDC's Birth Defects, Developmental Disabilities, Disability, and Health Center is funded at $87 million, a cut of $11.6 million from the FY 2003 funding level of $98.6 million. The center conducts a range of activities, including programs for the prevention of autism, fetal alcohol syndrome, and spina bifida.
Health Research
The President's FY 2004 budget request includes $27.4 billion for the National Institutes of Health (NIH). NIH is the world's largest and most distinguished organization dedicated to maintaining and improving health through medical research. Of NIH's 27 institutes and centers, those of particular importance to children and their families in the child welfare system include the National Institute of Child Health and Human Development ($1.245 billion); the National Institute of Mental Health ($1.382 billion); the National Institute on Drug Abuse ($996 million); and the National Institute on Alcohol Abuse and Alcoholism ($430 million).
Housing
The President's budget converts Section 8 housing vouchers for low-income renters into a block grant program administered by the states. Project-based vouchers continue to be administered by the U.S. Department of Housing and Urban Development. The budget's funding for these two programs and related activities in FY 2004 is $17.1 billion. The budget includes eliminating the Hope VI program which focuses on modernization and revitalization of the housing stock. The proposed budget notes the Administration's intent to continue funding the Family Unification Program, which provides Section 8 vouchers to families with children who have been placed, or are at risk of placement, in foster care primarily because the family lacks adequate housing, and to youth transitioning out of foster care.
Community Service
The President's budget includes a $128 million increase, for a total of $554 million to support 75,000 AmeriCorps members. The AmeriCorps program enables Americans of all backgrounds to serve in local communities through programs sponsored by nonprofit organizations.
Youth Development
The President's budget includes funding of $600 million for the 21st Century Community Learning Centers program, which is $400 million less than the current level. This program provides opportunities for students and their families to continue learning new skills and discover new abilities after the school day has ended.
Juvenile Justice
Under the President's budget, funding is eliminated for the Juvenile Accountability Block Grant (JABG). This program was created in the appropriations for the U.S. Departments of Commerce, Justice and State for FY 1998 (Public Law 105?119), and was recently authorized as part of the U.S. Department of Justice legislation signed into law on November 2, 2002
(P.L. 107-273). JABG provides funds for implementing graduated sanctions programs, establishing or expanding substance abuse programs, and promoting mental health screening and treatment.
The President's budget includes funding of $77.3 million for the U.S. Department of Justice's local delinquency prevention program (Title V). This is a reduction from approximately $95 million in recent years but would be an increase from the $46.5 million in FY 2003. Title V is the only federal funding source specifically targeted toward primary prevention which provides funding for programs aimed at youth who have not had contact with law enforcement but who are at high risk for doing so.
Also included in Public Law 107-273 is a new Juvenile Delinquency Prevention Block Grant that combines a number of previously separate components of the federal juvenile justice system including gang-free schools, state challenge activities, and mentoring. The President's budget includes $37.9 million in funding for this new block grant.
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