The vast majority of dedicated federal funding for child welfare is currently reserved for supporting children in foster care placements and cannot be used for prevention services or other supports for children after they leave foster care. States, tribes and localities need federal support to provide a full continuum of services for at-risk children and families – services such as family counseling, emergency housing support, referrals for drug treatment programs, and parenting classes, among others.
Unfortunately, states may access dollars under Title IV-E, the principal source of federal child welfare funding, only after children have entered foster care. Of the $7.2 billion federal funds dedicated for child welfare in 2007, approximately 90 percent supported children in foster care placements ($4.5 billion) and children adopted from foster care ($2.0 billion). States can use only about 10 percent of federal dedicated child welfare funds flexibly for family services and supports, including prevention or reunification services.
Addressing the inflexibility of current federal IV-E funding is critical to ensuring that case workers and other professionals can deliver services that are tailored to meet the needs of each child and family they serve. Additional federal investment in family support would ensure that some children never have to enter foster care at all, and can instead, remain safely where they want to be-at home. For those children who do enter foster care, flexibility could support efforts to help their families rebuild their lives and welcome children home as quickly as possible. When reunification is not possible, more flexibility in the federal child welfare funding stream would allow states to better support children leaving foster care for safe, permanent families through adoption or guardianship. With more flexible funds, states and tribes could increase and improve foster and adoptive parent recruitment, or help new permanent families be successful by providing more post-placement supports.
States should be rewarded for reducing the number of children in foster care, rather than punished by losing federal funds for case workers. Under the current system, states lose money for caseworkers when the caseload declines. States should be allowed to reinvest savings from safely reducing their foster care case loads into their child welfare programs.