The new Child Trends survey of state child welfare spending indicates that the overwhelming use of Title IV-E funding through Title IV-E waivers has been used for services that can be currently paid for under the current Title IV-E law. The funding totaled approximately $2 billion.

According to the survey of 24 states providing data just 10 percent of waiver funding is being spent on services and activities not normally reimbursable. According to the report 73 percent of waiver spending was for children eligible under Title IV-E foster care and for eligible services (foster care maintenance and administrative services) and another 16 percent was spent on eligible services (foster care maintenance and administrative services) but the child/family was not eligible under the current Title IV-E income limitations.

The survey could be significant since several jurisdictions including Los Angeles County, several counties in Ohio and Florida have been pushing for an extension of waiver authority due to expire this October. The survey of 2016 data does not include results from California however 2014 data reported by that state indicated that California waiver spending included 51 percent spent on services eligible to be covered under current Title IV-E and another 45 percent was spent on eligible services, but the children/families were not eligible under income standards.

The bigger challenge for waiver proponents is if the Congressional Budget Office (CBO) scores waiver extension legislation as having a federal cost. Informal reports indicate they could do that. If Congress continues a pattern set after the enactment of the 2008 Fostering Connections Act, each child welfare bill enacted has paid for itself by either being cost-neutral or by cutting funding in other parts of child welfare. A waiver proposal that is conditioned on further cuts to child welfare spending will cause many organizations to oppose such an extension on that basis alone. Another concern may be how a waiver would impact the implementation of the Family First Act.

This latest round of waivers was the result of a restoration of waiver authority in a 2011 law (PL 112-34) after it had expired in 2006. It was sought by some states and a few organizations. Up to ten states a year (for a total of 30) were allowed to apply under the conditions that states make at least two improvements in their child welfare system from a list of actions included in the bill including items such as expanding Title IV-E funding to kinship care, extending foster care to age 21, enacting a foster care bill of rights and several other options. It is unclear if those requirements were met by approved waiver states. The Los Angeles County (and a few other California counties) and the state of Florida are operating under a waiver originally granted just before the waiver sunset in 2006.

The Child Trends report indicates that of the 27 states listed, eight states spent more than 10 percent of their waiver dollars on non-IV-E eligible services and activities: Michigan 77 percent, District of Columbia 39 percent, Oregon 36 percent, Pennsylvania 35 percent, both Colorado and Indiana at 22 percent, Florida 13 percent and West Virginia at 11 percent.