BILL ANALYSIS Ó
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Date of Hearing: June 30, 2015
ASSEMBLY COMMITTEE ON HUMAN SERVICES
Kansen Chu, Chair
AJR 17
(Lopez) - As Amended June 25, 2015
SUBJECT: Foster Care Tax Credit Act.
SUMMARY: Memorializes the Legislature's request for the
President and Congress to pass the Foster Care Tax Credit Act.
Specifically, this bill:
1)Makes a number of legislative findings related to foster care,
pertaining to:
a) The importance of foster parents, the shortage of foster
homes, and the state's difficulty in recruiting and
retaining a sufficient supply of foster families;
b) The expenses involved in caring for foster children
relative to caring for one's own biological children, due
largely to heightened need for medical and supportive
services;
c) The frequency of short-term foster care placements due
to youth being reunified with their families;
d) The likelihood that children adopted from foster care
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will be adopted by former foster parents; and
e) The benefits that the recently-proposed federal Senate
Bill 664 - the Foster Care Tax Credit Act - would bring to
foster parents offering short-term placements to foster
children.
2)Resolves that the California State Assembly and Senate urge
the President and the United States Congress to enact Senate
Bill 664 of the 114th Congress.
EXISTING LAW:
1)Establishes a state and local system of child welfare
services, including foster care, for children who have been
adjudged by the court to be at risk or have been abused or
neglected, as specified. (WIC 202)
2)Allows a juvenile court to adjudge a child a ward or a
dependent of the court for specified reasons, including but
not limited to if the child has been left without any
provision for support, as specified. (WIC 300)
3)States that the purpose of foster care law is to provide
maximum safety and protection for children who are currently
being physically, sexually, or emotionally abused, neglected,
or exploited, and to ensure the safety, protection, and
physical and emotional well-being of children who are at risk
of harm. (WIC 300.2)
4)Requires out-of-home placement of a child in foster care to be
based upon selection of a safe setting that is the least
restrictive or most family-like and the most appropriate
setting available and in close proximity to the parent's home,
the child's school, and best suited to meet the child's
special needs and best interests. Further requires the
selection of placement to consider, in order of priority,
placement with relatives, nonrelated extended family members,
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tribal members, and foster family homes, certified homes of
foster family agencies, intensive treatment or
multidimensional treatment foster care homes, group care
placements, such as group homes and community treatment
facilities, and residential treatment, as specified. (WIC
16501.1(c)(1))
5)Establishes in federal law the Child Tax Credit, allowing
individuals to reduce their federal income tax by up to $1,000
per qualifying child, including foster children, as specified.
Further delineates a number of criteria that must be met for
children to qualify, including but not limited to a residence
test, whereby a child must have lived with the taxpayer for
more than half of the calendar year for which taxes are being
filed. (26 USC § 24)
FISCAL EFFECT: Unknown.
COMMENTS:
Child Welfare Services: California's Child Welfare Services
(CWS) system provides a number of services, supports, and
interventions aimed at protecting children and their health and
safety. Ultimately, the system seeks to preserve and strengthen
families by reuniting children with their biological parents
whenever appropriate. When this reunification is not possible
or appropriate, children are placed in the setting deemed least
restrictive and most suitable; this can include placement with
relatives or guardians (such as a nonrelative extended family
member) or adoption.
Under certain circumstances defined in state law, the juvenile
court may deem a child to be a dependent or ward of the court.
The court may then keep the child in his or her home or remove
the child from the home; removal may either result in eventual
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reunification with the family, or the court may determine that
an alternate permanent placement is more fitting. In this
latter case, the court must give preference to potential
placements in this order: relatives, nonrelative extended
family members, or family foster homes. Placement in group
homes or other intensive treatment placement settings are
considered only in more challenging situations where a child may
need stabilization services in order to transition to a less
restrictive placement, such as with a relative or foster
caregiver.
On January 1, 2015, there were 62,898 children in foster care in
California. Approximately 35% of these youth were placed with
relatives, non-relative extended family members, or in a
tribe-specified home. Another 25% were placed with foster
family agencies (FFAs) or FFA-certified homes, and almost 9%
were placed in foster family homes (FFHs) and small family
homes.
For fiscal year 2014-15, the FFH basic rate (which varies by age
of the foster youth) ranged from $671 per month for children
zero through 4 years old to $838 per month for youth ages 15 to
20. The same basic rate applies for youth placed in homes
through non-treatment FFA programs, while rates are higher for
youth placed through treatment FFAs. A 2007 report from
Children's Rights, the National Foster Parent Association, and
the University of Maryland School of Social Work found that
California's foster care rates covered only 61% of the costs of
raising a 2-year-old foster child, 59% of raising a 9-year-old,
and 44% of raising a 16-year-old.
"Short-term" foster care: Available CWS data do not provide an
exact picture of the number of all foster youth that are placed
less than six months, at any given time, in FFHs and
FFA-certified homes. However, some data are available for
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median lengths of stay and for youth entering CWS within
specified periods. For example, for youth who exited care to
reunification in 2014, the median length of stay for those
placed in FFHs was 4.8 months; for those placed in FFA-certified
homes, the median length of stay was 6.3 months. Additionally,
5,951 youth entered foster care for the first time during the
first six months of 2014 and were placed into FFHs or
FFA-certified homes; 1,905 (32%) of those youth were reunified
with their families within that six months.
Foster Care Tax Credit Act: Introduced in March 2015 and
referred to the Senate Finance Committee, the Foster Care Tax
Credit Act proposed to extend the benefits of the Child Tax
Credit to foster parents with whom foster youth are placed for
shorter periods of time. The federal Child Tax Credit allows
taxpayers to reduce their federal income tax by up to $1,000 per
qualifying child, including eligible foster children. However,
the Child Tax Credit has a residency requirement stating that,
to render a taxpayer eligible for the credit, a qualifying child
must have lived with the taxpayer for more than half of the
calendar year for which taxes are being filed. (Note that
California, while offering certain tax benefits related to
children, dependents, and adoption, does not offer a state
equivalent of the Child Tax Credit.)
The Foster Care Tax Credit Act would offer foster parents a
refundable tax credit of up to $1,000 per year, per foster
child, that is pro-rated by the number of months a foster child
is in a family's care.
Need for this bill: A fundamental goal of the foster care
system in California is reunification of children and youth in
the CWS system with their families. Attending this goal is an
emphasis on the use of home-based, family-like settings for the
temporary placement of youth while reunification services are
provided to those youth and their families. The provision of
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short-term care by foster families plays a crucial role.
Enactment by Congress of the Foster Care Tax Credit Act will
assist foster families providing short-term care by lessening
their federal income tax burden.
According to the author:
"Caring for a child in foster care can be more expensive than
caring for one's own biological children. Children placed
into foster care often have experienced significant emotional
and physical trauma and have higher incidences of medical and
behavioral health issues, resulting in additional costs to
foster parents. Foster families often incur additional
monetary costs when parenting these children for even just a
short time, and this legislation would make sure those costs
don't prevent families from taking in children who need homes.
We need to encourage more families to become foster parents.
The shortage of foster homes has been widely reported, and
placing children in foster homes is more cost effective with
better outcomes than placing them in group homes. We should
be working towards recruiting more foster parents so that
children, hopefully, will be adopted into permanent families."
REGISTERED SUPPORT / OPPOSITION:
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Support
Social Mission Central
The Village Family Services
Opposition
None on file.
Analysis Prepared by:Daphne Hunt / HUM. S. / (916) 319-2089
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