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Home > Advocacy > Financing Child Welfare Services > Brief History of Federal Child Welfare Financing Legislation


Brief History of Federal Child Welfare Financing Legislation

Federal funding for child welfare services was first authorized under Title V of the Social Security Act in 1935. From that point through 1962, a series of amendments expanded what child welfare services could be paid for by federal funds, including services that supplement or substitute for parental care. In 1958, Title V was amended to require states to provide matching funds to draw down their share of federal child welfare funds. Federal funding was capped for this program and Congress made decisions each year about the funding level.

In 1967, the Title V program became Title IV-B, Child Welfare Services, of the Social Security Act. The authorized funding level ranged from $55 million in 1968 to $266 million in 1977. Despite this authorization level, the actual funding appropriated never reached a high beyond the $66 million provided in 1980.

While funding for the Title IV-B Child Welfare Services program was growing at a slow rate, Congress expanded the use of Title IV-A, Aid to Families with Dependent Children (AFDC), in 1961 to include foster care funding for children who were in AFDC families. These children were eligible if a court determined that remaining in the home was contrary to the child's welfare. The 1961 action to expand AFDC in this way was temporary at first, but in 1969, participation in the program was made mandatory for all states. While reporting is incomplete, by 1969, 30 states did report that 16,800 children were receiving benefits under the program. By the middle of the 1970's, more than 100,000 children were receiving benefits.

During the mid 1970's, concerns grew in Congress about the growing numbers of children receiving Title IV-A foster care and the length of foster care placements. Since the Title IV-A funds were provided as an entitlement to states for AFDC-eligible children while funding for Title IV-B Child Welfare Services was capped, debate began about whether the guaranteed federal funding for foster care encouraged states to place children unnecessarily into foster care.

In 1974, Senator James Abourezk (D-SD) held one of the first hearings in Congress to focus on the treatment of Native American children in out-of-home placement, with particular attention on the placement of these children in non-Indian settings. In 1978, the Indian Child Welfare Act (ICWA) was enacted into law, establishing requirements for child welfare agencies when serving Native children and families.

In 1980, the Foster Care and Adoption Assistance Amendments were passed (P.L. 96-272). The law created a separate title, Title IV-E Foster Care and Adoption Assistance, in the Social Security Act to specifically fund these two categories of child welfare services. While providing reimbursements for the costs of children in foster care and support for adoptive parents, the law also expanded the number of protections for children in the foster care system. The 1980 law based eligibility on whether or not a child came from a family receiving AFDC or if that child came from a family eligible for AFDC.

Leading up to the enactment of Title IV-E Foster Care and Adoption Assistance, Congress held a series of hearings. According to the 1990 House Ways and Means Committee Green Book, by 1980 Congress had concluded that there were several problems with the child welfare system at the state level. These problems included:
  • placement in foster care without the provision of alternative services that might help the child remain at home;

  • foster care placements that were too restrictive (institutional settings) and too far from home;

  • a lack of written case plans;

  • a lack of periodic reviews of cases;

  • parents not being apprised of their child's situation;

  • a failure to provide reunification services;

  • the creation of unnecessary barriers to adoption for children who could not be reunited with their families; and

  • a lack of information on the children in the system.
As a result of these concerns, a number of new requirements and protections were added to the law, including a requirement that states must make "reasonable efforts" to prevent placement into foster care and to reunify children and their parents in cases where they were removed.

In 1981, legislation was passed by the U.S. Senate that would have combined Title IV-E Foster Care and Adoption Assistance, Title IV-B Child Welfare Services, Title XX Social Services, and social services staff training into a capped child welfare block grant. At that time, federal funding for SSBG was also entitlement. Although adopted by the Senate, that measure failed to pass the U.S. House of Representatives. A measure did pass, however, that created a block grant for Title XX-the Social Services Block Grant (SSBG). The law eliminated the state match requirement for SSBG funds and repealed the income eligibility requirements.

In 1985, Title IV-E was amended to add a provision targeted to assist states in helping children age 16 and older transition to independent living. The Independent Living Program funding was limited to those youth who were Title IV-E eligible. In 1988, the program was expanded to include all youth-not just those who were Title IV-E eligible. States were also allowed to use funds for follow-up services for up to six months after a youth was emancipated.

In 1993, Title IV-B was again amended to create a capped or limited amount of entitlement funds for family preservation and family support services. This became Subpart 2 of Title IV-B. While states had the ability to use Title IV-B funds for this purpose, the creation of a new fund to specifically target these services was seen as a way to encourage states in family support efforts.

In 1994, legislation directed the U.S. Department of Health and Human Services to develop a new child welfare review system. This new system would be tested out in the mid-1990s until regulations were published in 1998, resulting in what today is called the Child and Family Service Reviews (CFSR). That legislation also approved Title IV-E and Title IV-B child welfare demonstration waivers.

In 1995, Congress again debated the merits of combining existing child welfare programs into a capped child welfare block grant. The House-passed welfare reauthorization bill contained a new Child Protection Block Grant. That block grant combined the two largest federal funding sources for child welfare, Title IV-E Foster Care and Adoption Assistance programs and mandatory and discretionary funding of child welfare programs under Title IV-B, with over 20 other child welfare related programs, including the Child Abuse and Prevention Treatment Act (CAPTA), adoption opportunities, abandoned infants assistance, crisis nurseries, missing children's assistance, family support centers, certain provisions of the Victims of Child Abuse Act, and the Family Unification housing assistance program, into a capped block grants to the states. This child welfare block grant passed the House, but it failed to gain support in the Senate. The final legislation repealed the AFDC program and created the Temporary Assistance for Needy Families (TANF) block grant, however, the law requires that eligibility for Title IV-E Foster Care and Adoption Assistance be linked to July 16, 1996 AFDC standards.

In 1997, the Adoption and Safe Families Act (ASFA) was adopted (P.L. 105-89). ASFA contained several provisions focusing on moving children more expeditiously to permanency. Those provisions include new timelines for moving children to permanency; modification of the "reasonable efforts" standards required of state programs to specify that the child's safety and health is "paramount" to other concerns when deciding the placement of a child; and the creation of adoption incentive bonuses to states that increased the number of adoption from the foster care system. That law also reauthorized the Family Preservation and Family Support program, re-named it the Promoting Safe and Stable Families (PSSF) program, and continued the child welfare demonstration waivers.

In 1999, the Independent Living Program was renamed in honor of the late Senator John H. Chafee (R-RI) and was expanded by eliminating a minimum age and extending services to children ages 18 through 21.

In 2001, the Promoting Safe and Stable Families program was reauthorized for five years. The law continues to provide $305 million a year in entitlement funds and authorizes Congress to appropriate an additional $200 million a year. The reauthorization of PSSF also amended the John H. Chafee Independent Living Program to allow Congress to appropriate up to $60 million per year in funds for education and training vouchers for youth that "age-out" of foster care and created a new program to provide mentoring for children of incarcerated parents.

In 2003, the Ninth Circuit Court of Appeals issued a ruling in Rosales v. Thompson, 321 F.3d 835 (9th Cir. 2003) that made many more children eligible for Title IV-E federal foster care assistance. The court rules that HHS has misinterpreted Title IV-E of the Social Security Act in denying federal foster care benefits to certain children who have been maltreated and placed with relatives outside their homes. However, in 2005 Congress passed and the President signed the Deficit Reduction Act, which overturned the Rosales ruling. The same legislation created two additional $10 million funds for court improvement efforts.

In 2008 the Fostering Connections to Success and Increasing Adoptions Act is enacted. It amended parts B and E of Title IV of the Social Security Act to connect and support relative caregivers, improve outcomes for children and youths in foster care, especially in health care and education, provide for tribal foster care, improve incentives for adoption, and enhance training access for the child welfare workforce.

In 2010, the Affordable Care Act was enacted. This legislation extends Medicaid coverage to all youths who exit out of care as young adults up to age 26. In addition the prohibition of the pre-existing conditions exclusion, and expansions of Medicaid and the Child Health Insurance Program will benefit many families including those at risk for involvement in the system. This legislation also included federal support for home visiting programs which is a proven effective child abuse prevention strategy.

In late 2010 and late 2011, Congress reauthorized the Child Abuse Prevention and Treatment Act and IV-B of the Social Security Act, respectively. Authorization levels were not changed for either bill. Funding for subpart 2 of IV-B, the Promoting Safe and Stable Families program did change slightly. Mandatory funding decreased slightly from $365 million to $345 million. A temporary $20 million increase for the Court Improvement Program (under the PSSF funding stream) from the year before was shifted from the PSSF baseline to CIP moving forward.

2011 reauthorization of IV-B includes reinstatement of waiver authority for Title IV-E demonstration projects. This allowed HHS to issue up to 10 waivers each year from 2012 through 2014.

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