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$3.2 million fine may cause more obstacles


If you’re a follower of child welfare news, you probably saw coverage of the $3.2 million federal fine that DHHS will have to repay for improperly claimed foster care and administrative dollars. This fine is just for 2010 – more fines are likely coming for 2011 and possibly 2012 and more details on the fines and their impact should be forthcoming. While DHHS has promised to fix the administrative and oversight errors that lead to this improper claiming (a very good thing), don’t expect the impact of this fine to disappear overnight.

With the state’s general fund already stretched thin, the loss of a substantial amount of federal child welfare dollars could mean cuts to key programs that help vulnerable children and families. While we don’t know where the money will come from with certainty, it’s reasonable to be worried that child welfare programs or other programs administered by the Division of Children and Family Services may be forced to scale back.

What’s even more concerning, though, is the potential of these fines to set back one of the key pieces of legislation passed as part of the LR 37 child welfare package,  LB 820, which among other things, required DHHS to apply for a Title IV-E waiver. 

Don’t let the roman numerals scare you! At its core, a IV-E waiver is relatively simple: it lets states use the dollars reserved for out-of-home care by federal law more flexibly. Currently a state’s allotment of IV-E funds is determined by the number of children in out-of-home care that are eligible. We can’t tap into most federal funding unless a child is out-of-home.

As the chart above shows, very few federal funds are currently available for services that don’t involve a child’s separation from their family.  A waiver would let Nebraska shift more dollars to prevention and family preservation – a crucial part of “flipping our pyramid,” serving more children and families together safely. It represents the best chance we have to meaningfully and safely reduce the number of children we serve in out-of-home care.

So how is this $3.2 million fine connected to Nebraska’s IV-E waiver? Well, those funds we have to repay are IV-E funds, and the amount of a state’s IV-E waiver is based on how much federal funding they have received for the past 4 years (plus a projection out 4 years). So the amount of money we would get from the federal government for a waiver has likely decreased.

At the Children’s Commission on Friday, Thomas Pristow, Director of the Division of Children and Family Services, said that unless the federal government reduces the amount of the current fine and the ones still coming, Nebraska may not be able to apply for a IV-E waiver.

Is this the end of investing in prevention and early intervention? We certainly hope not, but it will take the will and advocacy of legislators, stakeholders, and the public to make sure that no matter what federal fines we receive, or opportunities for a waiver we may lose, we keep investing in better serving children and families.

Nebraska’s work to truly reform our child welfare system may have just gotten harder, but we won’t stop advocating for the changes that need to happen, and we know you won’t either.

Thank you to taking the time to share!

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