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Funding Sources for California Counties
- Human Services Funding
- The 2016 County Welfare Directors Association (CWDA) provided a Fiscal Essentials 101 presentation to inform attendees about the essentials of human services financing, including:
- a high-level overview on how human services is budgeted,
- information as to how programs are funded including 1991 and 2011 realignment, and
- current changes in finance.
- Click here for that presentation.
(Please note that page 15 of Fiscal Essentials 101 shows a hard-to-read sample of an Allocation Matrix. If you would like to see a recent Allocation Matrix, go to: https://www.cwda.org/featured-content/allocation-matrix)
- This CWDA PowerPoint presentation looks at all types of social services programs. The following section looks at funding for Child Welfare Programs.
- Child Welfare Services Funding
- Funding for all Social Services Programs including Child Welfare Services include:
- Federal
- State
- Realignment
- County General Fund
- Grants
- Allocations
- Counties are allocated funds based on various methodologies. Allocations are issued via a County Fiscal Letter which describes the methodology used to determine the allocation, claiming instructions for costs associated with the allocation, and the program codes associated with the allocation.
- Multiple allocations support Child Welfare Services, each defined to meet a specific need.
- Each allocation has a Sharing Ratio that defines the percent of the allocation that is supported by federal, state or county dollars (Federal/State/County).
- Some allocations are open-ended, that is, the amount of the allocation is not capped but will cover all costs incurred for the specific purpose of the allocation.
- Other allocations are capped, that is, there is a maximum amount that will be given for the program or activity.
- If the County’s costs exceed the allocation, the activity/program is “Overmatched” when county funds permit. Overmatching should not happen accidentally. It is a decision that may involve the Agency Department head, the County Administrative Officer, and/or Board of Supervisors.
- Allocations can fund:
- Specific programs and/or activities
- Administrative costs (including staffing and benefits), services or a combination of these.
- Each allocation has a methodology defined by California Department of Social Services (CDSS) methodology that identifies the county share and the federal and state participation in costs.
- Allocations can be:
- Reimbursement for actual cost of benefits and payments for specific programs
- Reimbursement for expenditures for funded activities or services (costs are submitted via CDSS Claim forms)
- Prorated share of the total state budgeted amount based on the caseloads or staff activities captured in Time Studies
- FEDERAL FUNDING
- “Titled” federal funding is received by the state and distributed to counties based on the methodology of each allocation. The Title number refers to the number assigned to the specific need that is being addressed.
- State and County funds are used to draw down or “match” federal funding.
- Titled federal funding for Child Welfare services includes:
- Title IV-B, Sub-Part 1 – A small, capped allocation which requires a 25% County General Fund match to draw down the allocation. It is used for services that support Emergency Response, Family Maintenance, Family Reunification and Permanent Placement programs. In many California counties, it is generally depleted by the first or second fiscal quarter. Additional services costs are shifted to non-federal funding (70% 2011 Realignment and 30% County General Share).
- Title IV-B, Sub-Part 2 – Promoting Safe and Stable Families (PSSF) allocation. See description below.
- Title IV-E – open ended entitlement; funds assistance payments and administrative costs including worker salary and benefits for Federal Foster Care, Adoptions and Kin-Gap Assistance. It also funds administrative costs including salary and benefits for Social Workers for referral to services, court work, placements, case planning and management. Cases that are not linked to federal funding are not eligible (see “linkage of Title IV-E funds to AFDC standards” below). Cost of services to children or families is not included.
- Title XIX – open ended entitlement; provides partial coverage for referrals and case work for Medi-Cal eligible or potentially eligible dependent children for health, mental health, substance abuse treatment and health related Social Services. It also provides 75% reimbursement for Skilled Professional medical personnel and 50% reimbursement for health-related services and activities.
- Linkage of Title IV-E funds to AFDC standards
- Use of Title IV-E funds is for children and families who are determined to meet federal eligibility requirements.
- Linkage to Federal eligibility is based on 1996 income and deprivation standards of the former AFDC (Aid to Families with Dependent Children) program:
- Deprivation standards: Children are deprived of parental support due to at least one parent’s continued absence, physical or mental incapacity or death.
- In two parent households in which both parents are able-bodied, at least one parent must be unemployed and have a “recent connection to the workforce.”
- Current income must be below the financial threshold established in 1996. In 1996, the income limit for a California family of three to qualify for AFDC was $723. The income limit for the same family to qualify for CalWORKs cash assistance today is $1,169.
- The number of federally eligible children has steadily decreased over the years due to the present cost of living far exceeding 1996 levels. Reimbursements for expenditures are discounted by the percentage of non-federal children in foster care; the result is decreasing federal participation of Title IV-E federal funding.
- There are ongoing federal discussions to delink Title IV-E funding from the discount rate and convert Title IV-E from an uncapped funding source to a capped (block grant) funding source.
- The percent of cases that are determined to be non-federal (i.e., families who do not meet the criteria for federal eligibility as explained above) establish a “Discount Rate” for the county. The average discount rate among California counties is 65%.
- TITLE IV-E WAIVER BLOCK GRANTS
- Counties were previously given the option of participating in a Title IV-E Waiver Project which gives a Block Grant instead of uncapped reimbursement for Foster Care benefits. Eight counties currently participate,
- Block Grants amounts are established using a base year when Foster Care caseloads were low.
- Block Grants give broader discretion to counties on how funding is used.
- Placement rates are set by the state for Title IV-E counties.
- Each county had to examine the fiscal benefits and risks of participating in the Title IV-E Waiver project and determine whether it is cost beneficial to participate.
- Federally funded prevention funds that flow through counties
- Promoting Safe and Stable Families (PSSF) is a federal program under Title IV-B, Subpart 2 of the Social Security Act for states to operate coordinated child and family services including:
- Child Abuse Prevention and Treatment Act (CAPTA)
- Supports states for improving the child protective services’ systems through its basic state grant.
- Supports child abuse prevention activities by funding discretionary grants to states and/or public or private agencies or organizations.
- See CDSS website for more information on CAPTA funding
- Community-Based Child Abuse Prevention (CBCAP)
- The purpose of CBCAP is:
- To support community-based efforts to develop, operate, expand, enhance, and coordinate initiatives, programs, and activities to prevent child abuse and neglect.
- To support the coordination of resources and activities to better strengthen and support families to reduce the likelihood of child abuse and neglect; and
- To foster understanding, appreciation and knowledge of diverse populations in order to effectively prevent and treat child abuse and neglect.
- See CDSS website for more information on CBCAP funding
- STATE FUNDING
State funds also provide a share of funding for various programs, services and activities, including:
- A share of funding for federal programs; the sharing ratio for each allocation defines the federal, state and county participation (Examples: CWS Skilled Professional Medical Personnel is 75/17.5/7.5, that is 75% Federal Health related Fund, 17.5% State funds and 7.5% County General Fund.
- State Only Programs for children and families not eligible for federal funding.
- Capped allocations for specific activities that are not included in 2011 Realignment, for example State Family Preservation, Commercially Sexually Exploited Children, Children and Family Team, Resource Family Approval. A county’s prorated share of allocations is based on a prorated share of state caseloads.
- Support for new premises and programs created by legislation that require new or enhanced activity; these are grouped in the Post 2011 Realignment allocation.
- Note that the state calculates the cost of Social Worker at $70,000. The cost in many counties exceeds the state’s coverage of costs.
- COUNTY FUNDING
- County General Funds are used to cover costs as follows:
- A mandated portion of assistance payments, i.e., Foster Care, Adoption.
- A mandated share of administrative costs.
- Overmatched costs (overspending in a specific area where federal and state funds do not provide sufficient funds to cover necessary costs, for example, Post 2011 Realignment).
- 2011 REALIGNMENT CHILD PROTECTION FUND
- Prior to Realignment
- Child Welfare Services was funded by multiple separate allocations,
- Funding sources were not stable, each year the state budget would determine the Child Welfare allocations.
- Each allocation was separate and could only be used as it was defined for that allocation (there was no flexibility to move funds between allocations).
- Allocations not spent were redistributed to counties who had “overspent” their allocation.
- 2011 Realignment
- In 2011, the State of California reorganized the distribution of funds to counties. It included two separate components:
- Child Protection Fund and Adult Protection Fund.
- A separate 2011 Realignment fund supports Mental Health.
- Child Protection 2011 Realignment intended outcomes:
- Combined multiple funding allocations into a single funding stream umbrella.
- Reassigned the responsibility of 100% of the non-federal costs to the counties along with a shift of tax revenue to counties in lieu of the state general fund.
- Funding for these programs now bypasses the state general fund and budget process entirely.
- In a strong economy realignment provides for growth.
- According to statute, growth must be used to fund the programs included in each realignment account.
- Did not change mandates -- counties are still responsible for the same mandates.
- Stabilized the funding source and dedicated a portion of the sales tax and vehicle license fees for Child and Adult Protection.
- Because the funding source is now dedicated, the amount of revenue is now capped based on the amount of sales tax and vehicle license fees collected.
- Benefit to counties
- Stable funding source from a dedicated revenue stream; however, this means the allocation is capped by revenues coming to the state and county from the License Fees and sales tax. Shifts in this revenue impact the allocations.
- Counties cannot use Realignment funds to pay for activities outside the scope of 2011 Realignment allocations.
- More flexibility for counties to design their own budget within CWS statutes and regulations to support individual county budget needs.
- Challenges to Counties
- Realignment funds are capped; this is not an unlimited source of revenue.
- Revenue may be down when program demands are on the rise.
- Vehicle License Fees tend to be volatile.
- POST 2011 REALIGNMENT
- New mandates enacted after 2011 Realignment have now been grouped into the Post 2011 New Premises Allocation:
- Includes Child Welfare Services premises resulting from legislation, regulations, executive orders, and administrative directives. This allocation funds additional time for caseworkers to complete specific activities.
- Claiming structure is established by CDSS and in coordination with CWDA.
- Includes many small, capped allocations such as: Case Record Reviews, Sibling Visitation, Pregnant/Parenting Minors and Non-minor Dependents.
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Activities
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- Meet with your agency’s Director to learn about his/her thoughts and concerns about the child welfare services budget. Is there anything s/he especially wants you to review and/or monitor?
- Meet with your agency’s budget Director and the fiscal analysts who work with your child welfare services budget. If you have a particular child welfare person, e.g., an administrator, who is the primary liaison to fiscal staff, you may want to ask these questions also of that person. However, you must meet with your agency’s fiscal staff as well to begin a solid working relationship.
- Ask questions about
- How the budget is developed in your county
- The trends in the budget, both revenues and expenditures, e.g., Has the budget been status quo in recent years? Is CWS overspending or underspending in any areas?
- Does the county overmatch (contribute more county general dollars to the child welfare activities than the sharing ratios require)?
- Have there been any audit exceptions due to either accounting or program errors, i.e., were the errors by accountants or by child welfare staff? Were the audit exceptions resolved?
- Do the budget Director and the child welfare Director have regular budget and contract meetings? Who will be the child welfare director’s primary fiscal liaison?
- Does the budgeting staff provide regular monthly reports?
- When child welfare services seek to or must initiate a new projects/program, what is the role and responsibility of fiscal staff and what is that of child welfare staff?
- Does the fiscal staff have any concerns that you should be made aware of? Any suggestions for your consideration?
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