[Congressional Record Volume 146, Number 138 (Saturday, October 28, 2000)]
[Senate]
[Pages S11300-S11302]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                 TAX CREDIT FOR SPECIAL NEEDS ADOPTIONS

  Ms. LANDRIEU. Mr. President, I would like to begin by commending the 
Senator from Nevada for his remarks, and to say that I agree with him 
and urge the President to veto the upcoming tax package. As written, 
the tax bill allocates tax breaks and tax benefits to many different 
interests and entities throughout America. While there are some good 
provisions in this bill, it could be more fair, more just and could 
give greater tax relief to those who need it the most. As it stands 
know, the package fails to demonstrate our commitment to many of the 
principles that we claim to stand for here on this floor.
  That is why I have come to this floor a number of times over the last 
couple of days, to just raise awareness about one small, but I think 
very important, part of the tax bill. I am happy to note that yesterday 
our majority leader, the Senator from Mississippi, Mr. Lott, and one of 
the leaders on this issue, our colleague from Idaho, Senator Craig, 
came to the floor and recognized that there had been, perhaps, a 
mistake made or a phrase not included, that if left out, could have 
some dire consequences for some of the children in this Nation--quite a 
large group, I might add, about 100,000 of them and potentially several 
hundred thousand more--who are really the most vulnerable among us.

  These are children who no longer have parents. They are the orphans 
of living, if you will. They are the children who are in foster care. 
These are the children who have already been abandoned once by an adult 
who was supposed to be taking care of them.
  I say to the Members on this floor--I see my good friend, Senator 
Grassley, who has been an outspoken advocate on this issue--that we 
have the opportunity because when this bill is presented to the 
President, he has said he will veto it because it is not distributing 
these benefits as equally across the board as they should be. I am 
hoping we can come to a bipartisan agreement, with Republicans and 
Democrats and the President himself, to fix what is missing in this tax 
credit.
  Let me explain a little bit about that. In 1996, there was for the 
first time a credit put in our Tax Code to advance adoption. I am the 
proud mother of two adopted children. They have brought my husband and 
me the greatest joy. In fact, when he was 5 years old my husband was 
adopted from an orphanage in Ireland. We talk publicly about the great 
joy of adoption. We want people to know it is a wonderful way to build 
a family.
  There are Members in this Senate, Republicans and Democrats, who have 
adopted children and who speak regularly about the choice of building 
families through adoption. The benefits to a birth mother, the benefits 
to the adoptive family, and most certainly the benefits to children, 
young and old. Some people think you don't need a family when you are 
18, you just sort of age out of the system and with a good education 
and diploma in your hand you can go on.
  I am 45. I am looking forward to going home to Thanksgiving dinner 
with my mother and father. My husband is 50. He is looking forward to 
going home for Christmas with his family. You are never too old to need 
a mother and father, and that is what this is about, changing attitudes 
in America to say every child deserves a family.
  We have a provision in this bill that is a good provision in that it 
proposes to increase and extend this very important adoption tax 
credit. It is now $5,000. In this bill, it would be doubled from $5,000 
to $10,000 for adoptions because, as we all know, the expense 
associated with adoption can be high. There are legal expenses. There 
are expenses associated with home study, agency fees. In fact, those 
expenses can range anywhere from a low of $2,000 to a high of $30,000, 
depending on what agencies you use or whether you are going through a 
domestic or an international adoption.
  So far all is good because we have a tax credit in place and we are 
about ready to double it. It could not be at a better time because the 
number of adoptions are up in America. Last year we had 130,000 
adoptions, 130,000 families. That is a lot of people affected, if you 
think about happy grandmothers and grandfathers and aunts and uncles 
and siblings. It is quite a number of happy Americans whose lives were 
made better through adoption.
  But there is a problem. I have tried to keep raising this issue until 
it is fixed. In the current bill, although the special needs adoption 
is being doubled to $12,000, this Treasury report which was issued this 
month and other letters and reports that have been written over the 
last several years, have indicated that the credit is not working for 
the special needs children. Because of the language in the law, not--
let me underline ``not'' because of a wrong interpretation by IRS--but 
because of our inability to write the proper phrase in the law--either 
our inability or our unwillingness--the tax credit is related to 
adoption-related expenses. We need to remove that phrase so the act of 
adoption itself of special needs children can get the credit.
  I wish to show you pictures of a couple of the children who are going 
to be left out if we do not make this fix. There are 100,000 children 
in foster care. Jennifer is one of them. Because Jennifer has been in 
foster care for some time, her adoption will not be handled by a 
private agency. Her adoption, if a family would come forward to

[[Page S11301]]

adopt her--and as you can see she is a beautiful and lovely child--if 
someone would come forward to adopt Jennifer, they would probably go 
through a public agency.
  There would be minimum home study expenses. The agency might actually 
pay for those.
  There would really be no ``qualified adoption expenses'' because the 
public agency, wanting to have Jennifer adopted, would minimize the 
expenses to the adopting family. So this adoption could potentially go 
through with less than $1,000 of direct expenses to the family. 
Therefore, if a family adopted Jennifer, the expenses they had would 
not qualify for a $5,000 tax credit or for a $10,000 tax credit because 
they do not fit into the bill's definition. Yet adopting a child such 
as Jennifer can bring much added expense to a family, particularly a 
working family, a middle-class family, perhaps having children already 
of their own but thinking God would like them to make room in their 
homes for another child.
  It is a tremendous financial responsibility, as all of us with 
children know, to raise a child. Much less, a child with special needs. 
A family who adopts a child with special needs does have additional 
expenses, they just are not covered under the very narrow definition of 
the code. Unless we change the law, they will not be able to get the 
tax credit. That is not what we intended.
  They say Jennifer is very sweet and has a great sense of humor. She 
likes to play outside, ride bikes, and swim. She is a very active 
child. She has some emotional disorders. Anyone would have emotional 
disorders if they were abandoned as a baby, abused, and grossly 
neglected. These children need healing, and we need to do everything we 
can to support that.
  This is Joshua and Jonathan. They are 5-year-old twins. As a sibling 
group, the hope is that they will be placed together. Therefore, a 
family who adopts them must have room in their hearts and homes for two 
children. Joshua is described as well-mannered, sneaky, and babyish. He 
enjoys school and its challenges. He has a nice smile and likes to 
cuddle. Jonathan is described as eager and easygoing. He likes to be 
helpful around the house. He likes talking about his feelings and 
explaining himself. Both are in excellent physical and mental 
condition. These are children we hope a family will identify and bring 
into their home and love.
  There are many examples. If we do not fix the tax credit, the 
families who adopt Jennifer, Joshua, and Jonathan will not get the full 
benefit of the tax credit.
  Some people have been critical about my passion with regard to this 
issue. They say: Senator, you shouldn't speak about it; at least the 
adoption credit is working for children from China, Honduras, and 
Guatemala. You know the desperate situation in those countries. Since 
this is the only form of financial assistance for families who want to 
adopt these kids, if it expires, they will be left with nothing.
  Yes, I want this tax credit to work when families choose to adopt 
internationally, when families choose to adopt a domestic healthy 
infant, and when they choose to adopt perhaps an older child, a sibling 
group, and give these kids who have already been let down once a chance 
to come into a family. I am here today because I want the tax credit to 
be available for all families regardless of what type of adoption they 
pursue. Mr. President, as I am sure you are aware, their are many 
different types of adoptions, each with different costs, different 
processes, and different children. All I ask, is that we have a tax 
code that recognizes and appreciates those differences.
  I believe there is consensus. There is an easy and relatively 
inexpensive way to fix this problem once and for all. That is why I am 
taking this time now to bring it to the attention of those who have the 
power to fix it at this late date, and hopefully we can.
  Some say we should wait until next year to fix it. If we can fix it 
now, why take another year out of the lives of some of these children? 
Why not help parents now?
  I will make one final point. The Senator from Iowa may be interested 
to know this. Yesterday, as I was on the floor speaking about this 
issue, the New York Times ran a full-length story about the problems 
with our foster care system. For the first time in our Nation's 
history, two girls in the foster care system and their attorneys 
successfully sued the Department of Social Services of Florida and 
received a judgment of $4.4 million.

  The case was brought by an attorney who believed that the children 
had been shortchanged. These two beautiful little girls had been 
abandoned by their mother. They were left in a Miami park or public 
place when they were 2 or 3 years old. Instead of determining whether 
these children could ever be reunited with their mother, father, or 
some relative to make them safe, the Department of Social Services put 
them in foster care. Those little girls spent the next 14 years of 
their lives going from home to home, with 30 different placements. They 
were sexually molested and physically abused.
  The court rightfully said the State of Florida now owes these two 
little girls 4.4 million dollars. There is a happy ending. They have 
subsequently been adopted by a wonderful family.
  I am here to say we had better fix this tax credit because if this 
case goes forward--and I think it will--the taxpayers of the United 
States are going to pick up a far greater expense than perhaps 
providing a few thousand dollars to families willing to adopt these 
children.
  Even if it is not the money, it is the justice and morality of this 
Nation, which is the strongest nation in the world. We do not have our 
strength represented by how high our stock market goes up. Our strength 
is represented by our willingness and ability to help kids and 
families, and if we cannot do this, then I do not know what we are 
doing here.
  I yield back the remainder of my time. I thank Senator Lott, Senator 
Craig, and Senator Grassley for their great leadership in this area. I 
look forward to working with them on this project.
  Mr. President, I ask unanimous consent to print the New York Times 
article in the Record.
  There being no objection, the article was ordered to be printed in 
the Record, as follows:

                [From the New York Times, Oct. 27 2000]

          Foster-Child Advocates Gain Allies in Injury Lawyers


States Face the Dual Threat of Class Actions and Huge Individual Damage 
                                 Awards

                          (By Nina Bernstein)

       The girls were 2 and 4 when their mother abandoned them 
     near a city park in Miami in 1986. Under federal law, the 
     Florida Department of Children and Family Services was 
     supposed to place them for adoption or return them home 
     within 18 months.
       Instead, over the next 14 years the sisters were shuttled 
     through more than 30 foster homes and institutions, beaten, 
     raped and repeatedly separated from each other while a stream 
     of caseworkers overlooked such obvious evidence of abuse as 
     the diagnosis of syphilis in the older girl when she was 9.
       The sisters' ordeal could have been just another horror 
     story in a national litany of foster care abuses. But last 
     year a Florida Circuit Court jury awarded them $4.4 million 
     in damages from the state.
       The case laid the groundwork for a new strategy in which 
     advocacy groups for children and personal injury lawyers, 
     some fresh from winning billions of dollars in legal 
     settlements with the tobacco companies, are using the threat 
     of multimillion dollar damage awards to try to change the 
     deeply troubled foster care system.
       In the past, individual damage suits for injured foster 
     children were typically settled behind the scenes for small 
     amounts. And efforts to win systemic changes through court 
     orders have often been frustrated by failures of enforcement.
       But court rulings that make government agencies easier to 
     sue and sizable jury awards in foster care cases like the one 
     in Florida have encouraged advocates for foster children and 
     personal injury lawyers to join forces over the past few 
     months in two-track litigation. Their lawsuits ask the courts 
     to change the system, while separately seeking damages on 
     behalf of children already harmed.
       ``This is for change, and to get the attention of the 
     powers that be--any money will go to the kids,'' said Robert 
     Montgomery, the lead counsel in the tobacco settlements in 
     Florida and one of a dozen top trial lawyers who began 
     working without pay on the foster care suits this summer.
       The sisters' case was filed by Karen Gievers, who has a 
     lead role in both the lawsuits for damages and the class 
     action seeking changes in the Florida system.
       Across the country, a similar pincer approach is typified 
     by Tim Farris, a Bellingham, Wash., trial lawyer who has 
     brought damage suits in state courts for 13 children shuttled 
     from foster home to foster home in a total of 208 placements. 
     The California-based National Center for Youth Law,

[[Page S11302]]

     a nonprofit children's advocacy group, recently joined his 
     effort to leverage those cases into a multi-million-dollar 
     overhaul of the state's child welfare system.
       ``In my own small-town way I said, `Look, you can move 
     these children as often as you wish, but if you do, you're 
     going to have to pay for the damages you do to them.'' Mr. 
     Farris said, ``and it's going to be cheaper to treat them 
     right.''
       Few suggest this kind of litigation is a shortcut either to 
     riches or to an overhaul of the state programs that are 
     trying to care for 600,000 children outside their homes. 
     State agencies typically can only be sued for compensation, 
     not punitive damages, and they can make it daunting in time 
     and money to unearth confidential records needed to prove a 
     case and collect. The $4.4 million Florida verdict is on hold 
     pending an appeal.
       But at a time when child-friendly policies figure 
     prominently in election campaigns, the political potency of 
     such cases may outweigh the legal drawbacks, said John 
     Coffee, a professor of law at Columbia University. 
     ``Plaintiffs' lawyers have learned that the class action can 
     be very, very useful when the state agency has some 
     vulnerability,'' he said.
       The vulnerability of government agencies has grown 
     considerably in some states. Jeff Freimund, as assistant 
     attorney general for Washington, said courts there had 
     rejected legislative caps on negligence awards, and 
     government payouts in civil cases in general have quadrupled 
     in six years, to $38 million in the last three months alone.
       ``The courts have opened the door to litigation on child 
     welfare activities,'' Mr. Freimund said. ``They're very 
     difficult cases to defend in front of juries because juries 
     often have the benefit of 20-20 hindsight.''
       Some officials, including Kathleen A. Kearney, the 
     secretary of the Florida Department of Children and Families, 
     say such litigation unfairly detracts from continuing efforts 
     to improve child welfare, diverting resources that 
     legislatures, not courts, should control. But others, 
     frustrated at the persistence of problems documented and 
     denounced for 20 years, welcome the new strategy.
       ``Money talks, and money makes policy,'' said Jean Soliz, 
     who headed Washington's Department of Social and Health 
     Services for three years, until 1995. She recalled that state 
     legislators made all the right speeches during her tenure, 
     but put $30 million into a new sport stadium rather than 
     provide court advocates or mental health care for 
     Washington's 11,000 foster children. Today, fewer than half 
     have an advocate in court proceedings, and more than a third 
     have been moved through three or more foster homes, studies 
     show.
       ``The torts give you leverage to make them take it 
     seriously; the torts don't fix anything,'' said Ms. Soliz, 
     who now directs the spending of a tobacco tax earmarked for 
     children in Nevada County, Calif. She emphasizes the 
     importance of enlisting national advocacy groups that can 
     draw on lessons from court consent decrees they have won in 
     suits against child welfare systems in at least 20 states.
       Bill Grimm, a lawyer with the National Center for Youth 
     Law, said groups like his had become more open to alliances 
     with personal injury lawyers because conventional strategies 
     had run into obstacles. While Congress has enacted tougher 
     foster care requirements--foster care time limits, for 
     example, are now set at a year rather than 18 months--federal 
     judges in some states have recently made it harder for 
     children to seek enforcement of those laws in federal court. 
     Their rulings hold that Congressional requirements intended 
     to protect foster children do not constitute rights.
       We are at a bit of a crossroads,'' Mr. Grimm said.
       Even in states already operating under sweeping 
     settlements, damage suits are playing a more prominent role. 
     In New York City, where an ambitious child welfare consent 
     decree imposed a moratorium on new class-action lawsuits, the 
     Administration for Children's Services has paid hundreds of 
     thousands of dollars in settlements to fathers who were not 
     notified that their children were in foster care. And city 
     lawyers are negotiating to settle a multi-million-dollar 
     lawsuit over a toddler who was beaten to death by foster 
     parents with a known history of abuse.
       But there are perils to trying to turn such cases into a 
     broader crusade in the absence of national allies or deep 
     pockets, said Lawrence Berlin, an Arizona lawyer who has won 
     settlements averaging $250,000 for a dozen children sexually 
     abused in foster care. His motion to turn the cases of some 
     children into a more powerful class action was denied in 
     federal court after six years of litigation that consumed his 
     practice, he said. The state rejected his offer to settle for 
     systemic changes.
       ``I'm not saying children haven't been abused,'' said Tom 
     Prose, an assistant Arizona attorney general in charge of 
     liability cases, who emphasized that the current 
     administration had made child protection a top priority. 
     ``The issue is, is it pervasive and are we ignoring it? And 
     my answer to you is, in Arizona, it's neither.''
       In Florida, where the number of children in foster care has 
     nearly doubled since 1998, to 15,000, the class-action suit 
     contends that foster children are now in greater danger of 
     emotional and physical injury from the state than from the 
     families from which they were taken.
       ``We had a toddler in a foster home so overcrowded the kid 
     spent the weekend strapped into a car seat,'' said Marcia 
     Robinson Lowry, the director of Children Rights, a national 
     advocacy organization based in New York, which recently 
     joined the Florida class action.
       Among the companion damage suits in Florida are some that 
     highlight the harm flowing from one bad foster home, that of 
     a couple in Hillsborough County. After the couple were 
     arrested in May on 40 felony charges of child abuse and 
     neglect, it emerged that the state had entrusted them with 28 
     foster children over four years, even as caseworkers recorded 
     their abusive practices.
       ``My brother has severe problems because of what happened 
     in that home,'' said Ashley Rhodes-Courter, now 14, who 
     entered foster care at 3 because of her mother's drug 
     problems, and endured 14 placements. She was 7 and her 
     brother 4 during their year in the couple's home.
       ``He was abused,'' she said. ``He had hot sauce put on his 
     tongue; he was dunked in a bathtub until he was nearly 
     drowned. It was very frightening to watch someone you love 
     being mistreated and you being able to do nothing about it.''
       For Ashley, a resilient and academically gifted child, 
     there was a happy ending. A family with the love, money and 
     persistence to extract her from the system adopted her in 
     1998. But her brother, who entered foster care at birth, 
     lives in a treatment center, still waiting for a family 
     capable of coping with the damage he suffered. He is one of 
     22 plaintiffs in the class action.
       Separately, he and Ashley are plaintiffs in damage suits 
     brought or planned against the state on behalf of all the 
     Hillsborough County couple's former foster children, 
     including the 23 that the state has refused to identify, and 
     8 the couple adopted with state subsidies who are now back in 
     the foster care system.
       Proponents of double-edged litigation say that even if 
     institutional change remains elusive, at least financial help 
     can be won for a few of the children the system has wronged--
     children like the two Florida sisters, now 17 and 18, who are 
     both literate and both mothers.
       ``You all hurt me all my life,'' the older sister told 
     officials in a deposition last year, declaring her 
     determination to keep her own baby daughter out of foster 
     care. ``I hate every last one of you.''

  The PRESIDING OFFICER. The Senator's time has expired.
  Mr. REID. Mr. President, parliamentary inquiry. If the bill has not 
come from the House by the time the Senator from Iowa completes his 
statement, I ask unanimous consent that the Senator from New York be 
recognized for 10 minutes. He has been waiting for most of the morning.
  The PRESIDING OFFICER. Without objection, it is so ordered. The 
majority has 5 minutes remaining.
  Mr. GRASSLEY. Mr. President, I believe morning business is going to 
expire at 10:30. Do I need to ask unanimous consent to extend morning 
business?
  The PRESIDING OFFICER. The situation is that the majority has an 
additional 5 minutes for morning business, after which the Senator from 
New York will be recognized for 10 minutes.

                          ____________________