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8.1B TITLE IV-E, Administrative Functions/Costs, Allowable Costs - Foster Care Maintenance Payments Program

Items with a star (*) and gray background have been modified from previous record.

Question Number 11:
08/31/2010 - Current
Question1 May the State claim Federal financial participation (FFP) for the administrative costs of an otherwise title IV-E eligible child who is placed in an unlicensed or unapproved foster family home?
AnswerUnder certain circumstances, yes. The State may claim administrative costs on behalf of an otherwise eligible child placed in an unlicensed or unapproved relative home for 12 months or the average length of time it takes the State to license or approve a foster family home, whichever is less. During this time, an application for licensure or approval of the relative home as a foster family home must be pending (section 472(i)(1)(A) of the Social Security Act). The State is prohibited from claiming administrative costs for a child placed in an unlicensed or unapproved foster family home that is not related to the child. For the purposes of this provision, a relative is defined by section 406(a) of the Social Security Act as in effect on July 16, 1996, and implemented in 45 CFR 233.90(v).

1 This question was originally deleted from the manual. The answer is new.

Source/Date8/7/2006
Legal and Related References*Social Security Act section 472(i)(1)(A), 45 CFR 233.90(v)(c)(1)

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08/17/2006 - 08/31/2010
Question*1 May the State claim Federal financial participation (FFP) for the administrative costs of an otherwise title IV-E eligible child who is placed in an unlicensed or unapproved foster family home?
Answer*Under certain circumstances, yes. The State may claim administrative costs on behalf of an otherwise eligible child placed in an unlicensed or unapproved relative home for 12 months or the average length of time it takes the State to license or approve a foster family home, whichever is less. During this time, an application for licensure or approval of the relative home as a foster family home must be pending (section 472(i)(1)(A) of the Social Security Act). The State is prohibited from claiming administrative costs for a child placed in an unlicensed or unapproved foster family home that is not related to the child. For the purposes of this provision, a relative is defined by section 406(a) of the Social Security Act as in effect on July 16, 1996, and implemented in 45 CFR 233.90(v).

1 This question was originally deleted from the manual. The answer is new.

Source/Date*8/7/2006
Legal and Related References*Social Security Act section 472(i)(1)(A), 45 CFR 233.90(v)

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11/12/2001 - 08/17/2006
QuestionMay we claim Federal financial participation (FFP) for the administrative costs of otherwise title IV-E eligible children who are placed in unlicensed foster family homes?
Answer*An August 17, 1993 memorandum from the Acting Commissioner of the Administration on Children, Youth, and Families to the Administration for Children and Families Regional Administrators allowed States to claim FFP for title IV-E administrative costs associated with a child who otherwise would be eligible for title IV-E foster care maintenance payments but for his/her placement in an unlicensed foster family home. The aforementioned practice was conceptualized by considering such child to be a candidate. We have since concluded that, while the policy itself, with certain limitations, is legally supportable, the rationale used in the 1993 memorandum is flawed. The term candidate refers to a child prior to his/her placement into foster care. Therefore, a child who has already been removed from home and placed in foster care cannot be considered a candidate. Once a child has been placed in foster care, the statute, at section 472 of the Social Security Act (the Act), sets forth certain eligibility criteria. All of the eligibility criteria at section 472 of the Act must be satisfied, including placement in a licensed foster family home or child-care institution, in order for the child to be eligible and thus, for the State to claim allowable administrative costs, with one limited exception.

FFP will continue to be available to States for the administrative costs incurred on behalf of a child placed in a relative foster family home while the State is in the process of licensing that home. If the State is not in the process of licensing the home, then it may not include the child when determining its administrative cost ratio. Moreover, if the State fails to fully license the relative foster family in question within the normal time frame for licensing foster family homes in that State, it may no longer consider that child when determining its administrative cost ratio.

We think such an approach gives effect to the instruction at section 471(a)(19) of the Act that requires States to consider giving relatives preference when making placement decisions. Admittedly, a State will not have a pool of licensed relative foster family homes in which to immediately place a child when s/he enters foster care. The State does, however, have a pool of licensed, unrelated foster family homes in which to immediately place a child who enters foster care. The statutory requirements to consider giving relatives preference in making placement decisions and to place children in licensed foster family homes create competing priorities for States. We think that permitting States to claim title IV-E administrative costs, but not foster care maintenance payments, on behalf of a child placed in an unlicensed related foster family home while the home is being licensed facilitates compliance with these two provisions.

States have expressed concerns regarding the fiscal impact of implementing this change in policy. We believe, therefore, that a delayed effective date is in order. States may adhere to the policy articulated in the aforementioned 1993 memorandum for an additional year to fully address implementation issues. Specifically, States may claim FFP for the administrative costs associated with an otherwise title IV-E eligible child placed in an unlicensed foster family home until September 30, 2002. Thereafter, FFP will be available consistent with the policy change articulated above. Beginning October 1, 2002, States may not claim FFP for the administrative costs of any child placed in an unlicensed unrelated foster family home. Beginning October 1, 2002, States may, however, claim FFP for the administrative costs of an otherwise title IV-E eligible child placed in an unlicensed relative foster family home during the licensing process.

Source/Date*ACYF-CB-PA-01-02 (7/3/01), ACYF-CB-PI-01-09 (November 7, 2001)
Legal and Related ReferencesSocial Security Act - sections 471(a)(10) and 474(a)(3)

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11/12/2001 - 10/07/2002
QuestionMay we claim Federal financial participation (FFP) for the administrative costs of otherwise title IV-E eligible children who are placed in unlicensed foster family homes?
Answer*An August 17, 1993 memorandum from the Acting Commissioner of the Administration on Children, Youth, and Families to the Administration for Children and Families Regional Administrators allowed States to claim FFP for title IV-E administrative costs associated with a child who otherwise would be eligible for title IV-E foster care maintenance payments but for his/her placement in an unlicensed foster family home. The aforementioned practice was conceptualized by considering such child to be a candidate. We have since concluded that, while the policy itself, with certain limitations, is legally supportable, the rationale used in the 1993 memorandum is flawed. The term candidate refers to a child prior to his/her placement into foster care. Therefore, a child who has already been removed from home and placed in foster care cannot be considered a candidate. Once a child has been placed in foster care, the statute, at section 472 of the Social Security Act (the Act), sets forth certain eligibility criteria. All of the eligibility criteria at section 472 of the Act must be satisfied, including placement in a licensed foster family home or child-care institution, in order for the child to be eligible and thus, for the State to claim allowable administrative costs, with one limited exception.

FFP will continue to be available to States for the administrative costs incurred on behalf of a child placed in a relative foster family home while the State is in the process of licensing that home. If the State is not in the process of licensing the home, then it may not include the child when determining its administrative cost ratio. Moreover, if the State fails to fully license the relative foster family in question within the normal time frame for licensing foster family homes in that State, it may no longer consider that child when determining its administrative cost ratio.

We think such an approach gives effect to the instruction at section 471(a)(19) of the Act that requires States to consider giving relatives preference when making placement decisions. Admittedly, a State will not have a pool of licensed relative foster family homes in which to immediately place a child when s/he enters foster care. The State does, however, have a pool of licensed, unrelated foster family homes in which to immediately place a child who enters foster care. The statutory requirements to consider giving relatives preference in making placement decisions and to place children in licensed foster family homes create competing priorities for States. We think that permitting States to claim title IV-E administrative costs, but not foster care maintenance payments, on behalf of a child placed in an unlicensed related foster family home while the home is being licensed facilitates compliance with these two provisions.

States have expressed concerns regarding the fiscal impact of implementing this change in policy. We believe, therefore, that a delayed effective date is in order. States may adhere to the policy articulated in the aforementioned 1993 memorandum for an additional year to fully address implementation issues. Specifically, States may claim FFP for the administrative costs associated with an otherwise title IV-E eligible child placed in an unlicensed foster family home until September 30, 2002. Thereafter, FFP will be available consistent with the policy change articulated above. Beginning October 1, 2002, States may not claim FFP for the administrative costs of any child placed in an unlicensed unrelated foster family home. Beginning October 1, 2002, States may, however, claim FFP for the administrative costs of an otherwise title IV-E eligible child placed in an unlicensed relative foster family home during the licensing process.

Source/Date*ACYF-CB-PA-01-02 (7/3/01), ACYF-CB-PI-01-09 (November 7, 2001)
Legal and Related ReferencesSocial Security Act - sections 471(a)(10) and 474(a)(3)

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11/12/2001 - 11/12/2001
QuestionMay we claim Federal financial participation (FFP) for the administrative costs of otherwise title IV-E eligible children who are placed in unlicensed foster family homes?
AnswerAn August 17, 1993 memorandum from the Acting Commissioner of the Administration on Children, Youth, and Families to the Administration for Children and Families Regional Administrators allowed States to claim FFP for title IV-E administrative costs associated with a child who otherwise would be eligible for title IV-E foster care maintenance payments but for his/her placement in an unlicensed foster family home. The aforementioned practice was conceptualized by considering such child to be a candidate. We have since concluded that, while the policy itself, with certain limitations, is legally supportable, the rationale used in the 1993 memorandum is flawed. The term candidate refers to a child prior to his/her placement into foster care. Therefore, a child who has already been removed from home and placed in foster care cannot be considered a candidate. Once a child has been placed in foster care, the statute, at section 472 of the Social Security Act (the Act), sets forth certain eligibility criteria. All of the eligibility criteria at section 472 of the Act must be satisfied, including placement in a licensed foster family home or child-care institution, in order for the child to be eligible and thus, for the State to claim allowable administrative costs, with one limited exception.

FFP will continue to be available to States for the administrative costs incurred on behalf of a child placed in a relative foster family home while the State is in the process of licensing that home. If the State is not in the process of licensing the home, then it may not include the child when determining its administrative cost ratio. Moreover, if the State fails to fully license the relative foster family in question within the normal time frame for licensing foster family homes in that State, it may no longer consider that child when determining its administrative cost ratio.

We think such an approach gives effect to the instruction at section 471(a)(19) of the Act that requires States to consider giving relatives preference when making placement decisions. Admittedly, a State will not have a pool of licensed relative foster family homes in which to immediately place a child when s/he enters foster care. The State does, however, have a pool of licensed, unrelated foster family homes in which to immediately place a child who enters foster care. The statutory requirements to consider giving relatives preference in making placement decisions and to place children in licensed foster family homes create competing priorities for States. We think that permitting States to claim title IV-E administrative costs, but not foster care maintenance payments, on behalf of a child placed in an unlicensed related foster family home while the home is being licensed facilitates compliance with these two provisions.

Source/DateACYF-CB-PA-01-02 (7/3/01)
Legal and Related ReferencesSocial Security Act - sections 471(a)(10) and 474(a)(3)

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