Pennsylvania Council of Children Youth and Family Files Lawsuit

A business association representing a consortium of child welfare services providers has filed a lawsuit seeking a court ruling ordering Democratic Governor Tom Wolf’s administration to release money earmarked for costs associated with caring for about 15,000 children in foster care. The money is currently being held up in what has been described as an 11-week-old budget impasse.

The Harrisburg-based Pennsylvania Council of Children, Youth and Family Services filed the lawsuit on Tuesday, September 15. The organization is self-described in the legal filing as “a statewide membership association of 110 private agencies that provide a broad array of services to support Pennsylvania’s children at-risk and families within the child welfare, juvenile justice and related systems.”

Services are “essential”

“At this point, we can no longer stand by and allow the services needed by this population of children to be threatened and we are asking the governor to rule these services as essential,” said Bernadette Bianchi, executive director of Pennsylvania Council of Children, Youth and Family Services, according to a report on Pennsyslvania’s ABC 27 News.

According to an AP report on, “The organization says holding up money is placing children at risk. Lawyer Joel Stein says the Wolf administration can declare the services to be essential and release the money.”

The report adds also that, “The Wolf administration says it legally cannot reimburse foster care costs without an approved budget because it is a county-run program and the state government doesn’t directly provide the services.”

Naturally, the situation deteriorated into the familiar game of political hot potato. According to an Associated Press report carried by WCAU NBC 10, Bala Cynwyd, PA, “The Wolf administration says the state isn’t able to make county child welfare payments until a budget is approved. It accuses Republican lawmakers of shortchanging children and youth services by $172 million in their budget plan.”

Close up

Pennsylvania Council of Children Youth and Family Lawsuit 2015Suit seeks to classify child welfare as an essential service.

A copy of the legal filing, obtained by Lifting the Veil, makes it clear that the organization seeks not only immediate financial remuneration for its 100-plus services providers, but much more significantly seeks a declaration from the Court such that child welfare services are to be deemed as “essential services.” Such a declaration would have long-standing consequences for the Commonwealth and its taxpayers.

The essential point is that the group’s request of the Court in effect seeks to impose the status of “essential service” by means of a judicial decree, rather than going though the legislative or executive branches of government, which are typically entrusted – for better or for worse – with establishing such definitions. The legal filing argues that,

Although Governor Wolf failed to approve the Budget, Governor Wolf did unilaterally identify certain services as “essential services” so that the state funds necessary to pay for those services would continue to be allocated and transmitted, even during the Budget Impasse.

Governor Wolf has the authority to designate certain services as “essential services” so that the state funds necessary to pay for those services can continue to be allocated and transmitted even in the absence of a Budget.

Federal Funds at Issue

As the legal filing makes clear, the Commonwealth of Pennsylvania is not only withholding state funds, but federal dollars that have been earmarked specifically for child welfare and foster care programs. What is unclear is whether these federal funds are sitting in a designated escrow account – which would certainly be among the more fiscally sound ways of handling the impasse until it is resolved – or whether they are co-mingled with other accounts in the Commonwealth’s coffers. This much is certain, the federal funds in question are there – somewhere.

The lawsuit references these federal funds – with emphasis – crouching its central argument in the familiar sugar-coated glaze of serving vulnerable children and families:

Respondents, despite repeated demand, have failed and refused to fund these critical and essential services, and have failed and refused to designate the care and support of these at-risk children and their families as “essential services” during the Budget Impasse. Respondents’ failure to satisfy their statutory obligations and their failure to direct and release the flow of money to support child welfare services, including the federal dollars which continue to be accessed by Pennsylvania, have placed these children at risk of immediate and irreparable harm and have jeopardized the delivery of these fundamental child welfare services.

From a legal standpoint, the Plaintiffs have a good argument when it comes to the federal money, and the Commonwealth’s obligation to expend it according to its state plan.

The funds which support these child welfare services, such as foster care placement services, including room/board and supervision, are primarily federal funds under Title IV-E of the Social Security Act, 42 U.S.C. ยงยง 670-6795, otherwise known as the “Child Welfare Act”, which are supplemented by some Commonwealth funds. The Commonwealth is required to, and has approved, a Plan under Part E of the Child Welfare Act, for the delivery of child welfare services in Pennsylvania.

Council of Children Youth and Family IV-E analysisCouncil of Children Youth and Family IV-E analysis

So much it true, the state has made such an agreement with the federal government in exchange for the funding, however with reading through the state plan in great detail – a a task I may save for the weekend – I am reluctant to say that there are any requirements that the federal funds be released immediately and on the demand of service providers.

If indeed service providers were given such broad powers to access funds by either bypassing the usual legislative and executive allocation procedures, they would be in the position of being more-or-less directly funded by the federal government, and with precious little oversight or accountability. (To put this another way, with precious less oversight than they already have to contend with, which isn’t much at all.) What is clear is that the business association stays abreast of federal financing trends. From the “members only” section of their web site, provided to Lifting the Veil by a concerned insider – comes an analysis of one of Pennsylvania’s former disallowances from federal authorities. In any event, it makes for an interesting read, as it discusses “time moment accounting” as a mechanism for increasing the flow of federal revenues to the state.

Outside Help

The Pennsylvania Council of Children, Youth and Family Services had or has had a contract with the Non-Profit Financial Group, Inc., a group that offers “Title IV-E Consulting Services.” As this service is described on its web site, complete with emphasis as in the original,

The Nonprofit Financial Group has a wealth of experience in preparing and reviewing Title IV-E Budgets for residential and foster care facilities. We served on the Pennsylvania Office of Children, Youth, and Family (OCYF) Quality Review Team and have gained specialized insight on the budgetary process. This, in conjunction with our nonprofit and governmental audit background, enables us to develop strategies to increase the amount of reimbursable costs, reduce the amount of disallowed expenses, and accelerate the budget finalization process. Our primary objective is to assist Providers in maximizing cost reimbursement amounts in accordance with federal and state regulations and speed the budget finalization process. We reviewed and filed over $600,000,000 of Title IV-E Reports.

The Council of Children Youth and Family Catalog, features a detailed list of training seminars that they provide to caseworkers, managers, and others in the field of child protection. Classes include such things as “Writing Skills for Case Documentation,” “Bullying and Social Aggression: Helping Children, Adolescents and Foster Families Work through the Issues,” “DSM-V: An Overview,” and, to be sure, all of their seminars are Eligible for Title IV-E Reimbursement.

Their Continuing Education Units are available “for Licensed Social Workers, Licensed Clinical Social Workers, Marriage and Family Therapists, and Mental Health and Professional Counselors.”

The interconnectedness of it all is astounding, as is the Council of Children, Youth and Family Services’ lawsuit seeking to declare the services that they provide as “essential service.”