This bill changes how federal benefits are handled for children and youth in foster care by requiring eligibility screenings, applications for benefits, and the establishment of trust accounts instead of using benefits to offset foster care costs.
Key Provisions of the Bill1. Eligibility Screening for Federal Benefits
By July 1, 2026, county human or social services departments must determine within 90 days of placement if a child or youth in foster care or a youth in the Foster Youth in Transition Program might qualify for federal benefits from:
Social Security Administration (SSA) (e.g., survivor or disability benefits).
U.S. Railroad Retirement Board.
Veterans Administration (VA) (e.g., benefits for children of deceased or disabled veterans).
If the child may be eligible, the county must apply for those benefits on their behalf.
2. Prohibition of Benefit Offsets for Foster Care Costs
Current law allows county departments acting as representative payees to use federal benefits to help cover the cost of foster care.
This bill prohibits that practice and instead requires that benefits be saved for the child’s future use.
3. Establishment of Trust Accounts
If a county department serves as the representative payee, it must:
Create a trust account for the child or youth.
Use account funds only for limited, unmet needs (as defined by regulations).
Save the remaining funds for the child or youth’s future financial stability.
4. Accounting, Transparency & Oversight
The Department of Human Services (DHS) must:
Establish guidance for counties on:
How to appoint representative payees.
Conducting disability screenings.
Handling cases where benefits are denied or a child leaves foster care.
Policies on how and when funds from the account can be accessed.
Provide technical assistance to counties in 2025 and 2026.
Summary
County departments must check if foster youth qualify for federal benefits and apply if they do.
Counties can no longer use federal benefits to pay for foster care costs.
Federal benefits must be saved in a trust account for the child’s future.
State agencies must provide oversight and guidance to ensure proper management of benefits.
Summary
Beginning on or before July 1, 2026, the bill requires a county
department of human or social services (county department) to determine whether each child or youth in foster care and each youth participating in the foster youth in transition program (child or youth) may be eligible to receive benefits administered by certain federal agencies, including the United States railroad retirement board, social security administration, or veterans administration (federal benefits) within 90 days after placement. If the county department determines that the child or youth may be eligible, the county department shall apply for federal benefits on behalf of the child or youth.
Under current law, certain federal agencies appoint a
representative payee or fiduciary (representative payee) to receive and manage certain federal benefits on behalf of a child or youth in foster care, and a county department serving as a representative payee may use federal benefits to offset the cost of providing basic care and services to a child or youth in foster care. The bill prohibits this benefit offset practice. Instead, the bill directs a county department serving as a representative payee to establish a trust account for the federal benefits (account). Money in the account is available for a limited set of current, unmet needs. Otherwise, the representative payee must save money in the account for the future needs of the individual child or youth.
The bill sets forth various accounting and notice requirements
related to federal benefits and requires the department of human services (department), in consultation with interested stakeholders, to establish guidance for county departments. The guidance extends to procedures for identifying a representative payee, disability screening for a child or youth, county department responsibilities when federal benefits are denied or when a child or youth leaves foster care, and policies governing access to account funds. The department shall provide technical assistance to a county department during the 2025 and 2026 state fiscal years.
