Court settlement stops subsidy cuts for foster parents

When the Indiana Department of Child Services proposed to cut subsidies for foster care and adoptive parents, the American Civil Liberties Union filed a lawsuit in hopes of preventing the cuts.

The DCS and ACLU reached a settlement over the proposed 10 percent cuts.

The DCS originally pursued the idea of subsidy cuts in order to ensure the availability of long-term funding for Indiana foster and adoptive families. Subsidies are currently $25 per day.

“The $25 per day is the third highest in the country,” DCS Director of Communications Ann Houseworth said. “If we were to cut that by 10 percent that would be the fifth highest in the nation. We felt comfortable recommending that for our budget.”

The settlement’s terms dictate that the DCS must develop a study to determine exactly what the costs are for supporting foster and adoptive children. In order to change the current subsidy rate, the DCS will have to work with the class in ACLU’s lawsuit.

ACLU attorney Ken Falk said the ACLU was satisfied with the terms of the settlement.

However, if the DCS chooses to cut subsidies after using the study, Falk said the ACLU reserves the right to file another lawsuit.

The ACLU filed its class action suit on behalf of all foster parents, foster children, adoptive parents and adoptive children receiving subsidies from the DCS.

“What you had were thousands of foster parents and kids who were being told out of the blue that they were going to be getting significantly less per diem than they were originally told,” Falk said.

The DCS is also proposing rule changes to its Indiana Administrative Code, Houseworth said.

“DCS is proposing a rule that will direct any rate changes be based on certain evidentiary bases,” Houseworth said. “What the ACLU has agreed to is to create this rate methodology. Any rate changes would be based on specific methodology rather than the changes being set arbitrarily.”

The DCS is currently in the process of reviewing the testimony comments on the proposed rule changes.

Those comments will be sent to the office of Indiana Attorney General Greg Zoeller for his signature. The proposed rules will then go to Gov. Mitch Daniels’ office for his signature.

Houseworth estimated the proposed rules will arrive to Daniel’s office in January 2011.

Initially, there were two lawsuits filed about the proposed cuts against the DCS: one by the ACLU and another by the Indiana Association of Residential Child Care Agencies.

The lawsuits were filed in federal court in December 2009.

In January 2010, a federal judge placed the case under preliminary injunction.

Because of this, the DCS was unable to lower subsidy rates during 2010.

“The court order is in place so our agencies did not take a cut this year,” IARCCA Executive Director Cathleen Graham said.

IARCCA’s lawsuit with the DCS has not been resolved.

“We are in some preliminary talks with the DCS, but right now there is no settlement on our part of the lawsuit,” Graham said.