Last week, New York City announced that it would change its policy of taking foster children’s Social Security benefits to pay for their care. Instead, funds owed to youth in state care will be saved in an account that they can access when they become adults and leave the child welfare system.
“This is their money and they deserve to use it as they see fit,” reasoned Jess Dannhauser, the commissioner of the city’s Administration for Children’s Services.
The Philadelphia City Council is considering a similar change.
Teenagers who age out of foster care face many challenges. They must navigate the difficult transition to independence in adulthood while lacking the social safety net that many teens take for granted. These young adults don’t have parents to call to ask for help when the rent is due, the refrigerator is empty, or the cell phone company threatens to shut off service.
Statistics show that former foster youth are more likely than their peers to become homeless, incarcerated, or human trafficked.
But in most states, child welfare agencies make foster children’s lives even harder by taking Social Security benefits. Under federal law, many foster children are owed survivor benefits if their parents died. Foster children who are disabled are eligible to receive Supplemental Security Income, which can amount to more than $800 per month.
A 2021 review by the Marshall Project and NPR determined that child welfare agencies in 36 states routinely apply to the Social Security Administration to become the foster child’s financial representative and take their benefits. The Government Accountability Office found that child welfare agencies were the “representative payee” for 81 percent of the foster children receiving Social Security benefits in states that were reporting data.
How much are child welfare agencies taking from foster children? Nearly $180 million annually.
In a 2003 decision, the Supreme Court ruled that child welfare agencies were allowed to apply for and use foster children’s Social Security benefits.
Child welfare agencies and others who defend this practice argue that using a child’s Social Security benefits to support their care is consistent with the purpose of survivor or disability benefits. They also reason that states would stop applying for foster children’s Social Security benefits if they no longer had a financial incentive to do so.
But state child welfare agencies already receive more than $12 billion in federal funding for child welfare. And they currently have other sources of federal aid that they can tap into if needed. Through the American Rescue Plan, states and local governments received an extra $350 billion in aid that can be used to “maintain vital public services.” In fact, state and local governments are “flush with cash,” according to the Committee for a Responsible Federal Budget.
It’s also unclear why states and child welfare agencies would stop applying for foster children’s Social Security benefits if they were no longer receiving the money. State lawmakers and child welfare leaders could require that caseworkers review whether foster children may be eligible and help them apply for their Social Security benefits.
In 2016, Rep. Danny Davis (D-Ill.) introduced a bill, the “Protecting Foster Youth Resources to Promote Self-Sufficiency Act,” which would have prohibited state or local government agencies from using Social Security survivor or disability benefits to reimburse the state for providing foster care. But the legislation was not passed.
With more cities considering ending this practice, it’s time for Congress to act. Foster children already face too many disadvantages. Lawmakers shouldn’t allow child welfare agencies to take their Social Security benefits.
Dan Lips is a visiting fellow with the Foundation for Research on Equal Opportunity. Tim Keller is Senior Vice President and Legal Director with Gen Justice.