District of Columbia: Federal Funds for Foster Care Improvements 
Used to Implement New Programs, but Challenges Remain (22-JUL-05,
GAO-05-787).							 
                                                                 
To help improve foster care in the District of Columbia, the	 
Congress provided $14 million for fiscal year 2004 to the Child  
and Family Services Agency (CFSA), the Department of Mental	 
Health (DMH), and the Metropolitan Washington Council of	 
Governments (COG). These funds were for programs for early	 
intervention, emergency support, and student loan repayments;	 
computer technology upgrades, mental health services, and respite
care (short-term care to provide relief for foster parents). GAO 
was asked to (1) assess whether the federal funds were being	 
obligated and expended by the District government and COG	 
consistent with provisions in the District of Columbia		 
Appropriations Act, 2004, and the spending plans that were	 
submitted to the Congress; (2) determine whether internal	 
controls were operating effectively over the obligations and	 
disbursements; and (3) assess the extent to which the District	 
government and COG have implemented the foster care improvement  
programs and initiatives specified in the act and spending plans.
GAO received written comments from CFSA, DMH, and COG. The	 
agencies generally agreed with GAO's findings and conclusions.	 
-------------------------Indexing Terms------------------------- 
REPORTNUM:   GAO-05-787 					        
    ACCNO:   A30877						        
  TITLE:     District of Columbia: Federal Funds for Foster Care      
Improvements Used to Implement New Programs, but Challenges	 
Remain								 
     DATE:   07/22/2005 
  SUBJECT:   Aid for education					 
	     Federal aid programs				 
	     Federal aid to cities				 
	     Financial analysis 				 
	     Financial statement audits 			 
	     Financial statements				 
	     Foster children					 
	     Funds management					 
	     Internal controls					 
	     Locally administered programs			 
	     Performance measures				 
	     Program evaluation 				 
	     Appropriations					 
	     Federal funds					 

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GAO-05-787

                 United States Government Accountability Office

                     GAO Report to Congressional Committees

July 2005

DISTRICT OF COLUMBIA

 Federal Funds for Foster Care Improvements Used to Implement New Programs, but
                               Challenges Remain

                                       a

GAO-05-787

[IMG]

July 2005

DISTRICT OF COLUMBIA

Federal Funds for Foster Care Improvements Used to Implement New Programs, but
Challenges Remain

  What GAO Found

The District and COG have used the federal funds for foster care
improvements as intended by the Congress and as described in their
respective spending plans. As of March 31, 2005, about $13.2 million of
the funds provided had been obligated, about $6.2 million of the obligated
funds had been expended, and about $722,524 remained unobligated. The
unobligated funds for CFSA and DMH, in the amounts of $588,859 and $30,545
respectively, ceased to be available for new obligations after September
30, 2004, and should revert to the general fund of the U.S. Treasury.
However, there is no such fiscal limitation on COG's use of the funds it
received; thus, its unobligated $103,120 remains available for its foster
care improvement program.

Internal controls were generally operating effectively over obligations
related to the federal funds at CFSA and DMH. Overall, we found that
authorized personnel were processing and approving transactions and
transactions were adequately supported. However, we found three instances
worth discussion. These involved the need for sufficient documentation,
better adherence to operating procedures and greater control over physical
assets.

CFSA, DMH, and COG have implemented the programs and initiatives specified
in the appropriations act and spending plans; however, it is too early to
assess the effectiveness of some and challenges remain for others.
Although implementation of the early intervention program was delayed,
this program helped about 150 families. Also, the emergency support fund
helped about 100 kinship families-relatives who provide foster care.
However, it will be a challenge for CFSA to reduce the number of
unlicensed kinship homes-one program goal. Although most of CFSA's
unlicensed homes are not kinship homes, 265 of the 300 unlicensed homes
are not in the District and officials from other jurisdictions will play a
role in the licensing process. About 70 percent of CFSA's eligible
caseworkers participated in the agency's student loan repayment program.
This program was intended to help recruit and retain caseworkers, but
CFSA's attrition rate increased from about 15 percent in 2003 to about 18
percent in 2004. CFSA developed an information technology plan that
indicates the system upgrades will be completed by the end of 2005, and
provided laptops to some caseworkers. DMH increased mental health services
available to foster care children; however, it faces ongoing challenges in
building its capacity to provide assessments and in securing long-term
funding for treatment services. COG established a respite program for
foster parents, but few families completed the required licensing process,
and fewer placements were made than anticipated. It may be a challenge for
COG to recruit, train, and license enough respite providers and convince
foster parents to participate.

                 United States Government Accountability Office

Contents

  Letter

Results in Brief
Background
CFSA, DMH, and COG Obligated and Spent Funds for Purposes

Consistent with the Appropriations Act and Spending Plans, but

Some Funds Were Not Used Internal Controls Are Generally Operating
Effectively New Programs Have Been Implemented to Improve Foster Care, but

Challenges Remain Concluding Observation Agency Comments and Our
Evaluation

1 4 6

11 13

17 30 30

Appendixes

Appendix I:

Appendix II:

Appendix III:

Appendix IV:

Appendix V:

Scope and Methodology

Comments from the District's Child and Family Services Agency

Comments from the District's Department of Mental Health

Comments from the Metropolitan Washington Council of Governments

GAO Contacts and Staff Acknowledgments

                                       33

                                       36

                                       40

                                     43 44

Tables Table 1: Purposes and Plans for the Fiscal Year 2004 Foster Care 
                                 Improvement Funds                         10 
              Table 2: Funds Received, Obligated, and Unobligated by CFSA, 
                         DMH, and COG, as of March 31, 2005                13 
              Table 3: Eligible Services and Supports Provided through the 
                                                                     Early 
                                Intervention Program                       18 
           Table 4: Key Steps in CFSA's Information Technology Plan, as of 
                                   June 15, 2005                           25 
               Table 5: Foster Care Children Receiving Mental Health       
                                     Treatment                             27 

Figures Figure 1:  Types and Numbers of Services Provided to Families      
                             with Early Intervention Program Funds         19
           Figure 2:   Number and Types of Services Provided to Families   
                                             with                          
                                    Emergency Support Funds                21 
           Figure 3:    Distribution of Student Loan Repayment Amounts     23 

Contents

Abbreviations

BSW bachelors of social work
CFSA Child and Family Services Agency
COG Metropolitan Washington Council of Governments
CSSP Center for the Study of Social Policy
DMH Department of Mental Health
FACES CFSA's automated case management system
FAPAC Foster and Adoptive Parents Advocacy Center
FBI Federal Bureau of Investigation
FFTM Facilitated Family Team Meeting
ICPC Interstate Compact on the Placement of Children
ILP Independent Living Placements
IT information technology
MRSS Mobile Response and Service Stabilization
MSW masters of social work
PASS Procurement Automated Support System
SOAR System of Accounting and Reporting

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A

United States Government Accountability Office Washington, D.C. 20548

July 22, 2005

The Honorable Sam Brownback
Chairman
The Honorable Mary Landrieu
Ranking Minority Member
Subcommittee on the District of Columbia
Committee on Appropriations
United States Senate

The Honorable Joe Knollenberg

Chairman

The Honorable John W. Olver

Ranking Minority Member

Subcommittee on Transportation, Treasury, and Housing and Urban
Development, The Judiciary, District of Columbia, and Independent Agencies

Committee on Appropriations

House of Representatives

In fiscal year 2003, about 3,000 children in the District of Columbia (the
District) were under the care of the city's Child and Family Services
Agency (CFSA). Most of these children had been removed from their homes
because of abuse or neglect and were being cared for by foster parents or
relatives, known as kinship families. These foster children and the
families that care for them need various services and support. CFSA is the
District government agency with primary responsibility for ensuring the
proper care of these children, and it works with several other District
agencies to provide essential services to the children and their families.
One of these is the Department of Mental Health (DMH), which provides
comprehensive mental health services to foster children as well as to
other children, teenagers, adults, and families. Mental health services
are considered critical for children who have suffered abuse or neglect.
Organizations outside the District government also help to support the
foster care system. One such organization is the Metropolitan Washington
Council of Governments (COG), which works across jurisdictions to address
issues facing the metropolitan area, such as an insufficient number of
foster parents.

Because CFSA had a history of mismanagement and failed to protect some of
the children under its care, the Congress enacted laws and provided funds
to help improve the city's foster care system. The District of

Columbia Appropriations Act, 2004,1 included a federal payment of $14
million for foster care improvements in the District. Funds were provided
for (1) CFSA to establish an early intervention program to help reduce the
number of children coming into foster care, an emergency support fund to
help reduce the number of unlicensed kinship homes, and a loan repayment
program to help recruit and retain caseworkers, as well as to upgrade its
automated case management system and provide caseworkers with computer
technology to help improve case management and caseworkers' productivity;
(2) DMH to provide all court-ordered or agencyrequired mental health
screenings, assessments, and treatments to children in CFSA's care; and
(3) COG to develop a program with the Foster and Adoptive Parent Advocacy
Center (FAPAC)2 to aid in recruitment of foster parents and provide them
with respite care (short-term care provided by individuals licensed to
care for foster children when the foster family needs to take a break or
attend to other matters). On March 17, 2004, the District received the $14
million federal payment, less a 0.59 percent rescission, for a total of
about $13.9 million.3

In September 2004,4 we reported on several CFSA and DMH management issues
related to the District's foster care system and the District's and COG's
plans for and use of the federal foster care improvement funds. We found
that CFSA, DMH, and COG had spending plans that were consistent with the
statutory language providing these federal funds and that only a small
portion of the foster care improvement funds had been obligated or spent
as of June 2004, in part because CFSA, DMH, and COG did not receive the
funds until March 2004. Most of the expenditures outlined in the spending
plans were for operating costs that would continue indefinitely once the
programs were established. At that time, it was uncertain how the District
and COG planned to fund some of these initiatives in the long term. We
also reported that many steps had been

1Pub. L. No. 108-199, Div. C, title 1, 118 Stat. 3, 111 (Jan. 23, 2004).

2The Foster and Adoptive Parents Advocacy Center is an organization that
assists foster, kinship, and adoptive parents of children in the District
of Columbia.

3Section 168 of Division H of the Consolidated Appropriations Act, 2004,
Pub. L. No. 108-199, included a provision for an across-the-board 0.59
percent rescission to be deducted from the budget authority provided for
any discretionary accounting in the act.

4GAO, D.C. Child and Family Services Agency: More Focus Needed on Human
Capital Management Issues for Caseworkers and Foster Parent Recruitment
and Retention, GAO04-1017 (Washington, D.C.: Sept. 24, 2004).

taken to improve the District's foster care system, but that most of the
programs and initiatives would need sustained attention and ongoing
support to achieve the intended results.

Since the issuance of our September 2004 report, we have, as called for by
the appropriations act, reviewed the obligations and expenditures of the
fiscal year 2004 federal funds provided for foster care improvements. As
you subsequently requested, we have also assessed the status of the
programs supported by the foster care improvement funds. Specifically, our
objectives were to (1) assess whether the federal funds were being
obligated and expended by the District government and COG in a manner
consistent with the act's provisions and the spending plans that were
submitted to the Congress, (2) determine whether internal controls are
operating effectively over obligations related to the federal funds for
foster care improvements received by the District and COG, and (3) assess
the extent to which CFSA, DMH, and COG have implemented the foster care
improvement programs and initiatives specified in the act and spending
plans.

To analyze CFSA, DMH, and COG's use of their fiscal year 2004 federal
funds for foster care improvements, we reviewed the agencies' spending
plans, budget data, and internal reports of obligations and expenditures
for the period March 2004 through March 2005. We interviewed financial and
program personnel from all three organizations and from the District
government's central Office of the Chief Financial Officer to obtain an
understanding of the procedures and controls over the use of the funds. In
addition, we selected a statistical sample of CFSA and DMH obligation
transactions covering the period March 17, 2004, through September 30,
2004, from total obligations to test whether procedures were properly
implemented to provide internal control over the use of the funds.5 We
reviewed COG's fiscal year 2004 financial statements audit opinion,
conducted walk-throughs of the accounting, payroll, procurement, and
payments processes in place, and analyzed its spending plans, budget, and
financial documents. To assess the extent to which CFSA, DMH, and COG had
implemented the foster care improvement programs specified in the
appropriations act, we interviewed knowledgeable officials, reviewed
related program policies and protocols, and analyzed program data. We took
several steps to assess the reliability and reasonableness of the program
data. Overall, we found the data to be sufficiently reliable for the

5See appendix I for statistical sampling details.

purpose of assessing the status of the foster care improvement programs.
We conducted our work from October 2004 through June 2005 in accordance
with U.S. generally accepted government auditing standards. See appendix I
for more details on our scope and methodology.

Results in Brief	The District and COG have obligated and expended federal
funds for purposes consistent with the provisions of the appropriations
act and their respective spending plans. As of March 31, 2005, about $13.2
million of the funds provided had been obligated; about $6.2 million of
the obligated funds had been expended, and about $722,524 remained
unobligated. The unobligated funds for CFSA and DMH, in the amounts of
$588,859 and $30,545 respectively, ceased to be available for new
obligations after September 30, 2004, and should revert to the general
fund of the U.S. Treasury. When funds were disbursed to COG from the
District, these funds lost their federal payment character; thus, there is
no fiscal limitation on COG's use of its $103,120 in unobligated funds.

Internal controls were generally operating effectively over obligations
related to the foster care improvement funds at CFSA and DMH. Overall, we
found that authorized personnel were processing and approving transactions
in accordance with District policies and procedures, and that transactions
were adequately supported at CFSA and DMH. However, in our testing at
these two agencies, we found three instances worth discussion. These
involved the need for sufficient documentation, better adherence to
operating procedures, and greater control over physical assets. We did not
conduct detailed transaction testing at COG because it received an
unqualified opinion on its fiscal year 2004 financial statements and the
auditor did not identify any reportable instances of internal control
weaknesses or noncompliance with laws and regulations under Government
Auditing Standards.6

CFSA, DMH, and COG have implemented the programs and initiatives specified
in the appropriations act and the spending plans; however, there has not
been enough time to assess the effectiveness of some of them and
challenges remain that could affect the success of others.

6GAO, Government Auditing Standards 2003 Revision, GAO-03-673G
(Washington, D.C.: June 2003).

o 	CFSA's early intervention program and its emergency support fund helped
about 150 families by providing funds to pay rental fees and utilities and
buy furniture and other items. However, implementation of the early
intervention program was delayed due to the need to train the parties
involved with the family meeting component of the program and, according
to agency officials, there has not been enough time to determine whether
the program has been effective.

o 	One goal of the emergency support fund is to help CFSA reduce the
number of unlicensed kinship foster homes. As of April 2005, CFSA had
children in more than 300 unlicensed foster homes, just as it did in 2003,
but according to agency officials most of these were not kinship homes.
Nonetheless, because most of the unlicensed homes are located outside the
District, it will be a challenge for CFSA to ensure that managers in other
jurisdictions take timely and adequate steps to help license them.

o 	About 140 of the 190 eligible caseworkers participated in CFSA's
student loan repayment program; however, $400,000 was not used because,
according to agency officials, the federal funds were not available until
after the height of their recruitment season and some caseworkers were
reluctant to commit to working at CFSA for several years, as required by
the program. It is too soon to tell whether the student loan repayment
program will help improve retention in the long-term, but CFSA's attrition
rates increased from 15 percent in 2003 to nearly 18 percent in fiscal
year 2004.

o 	CFSA developed an information technology plan and purchased and
distributed laptops to some caseworkers. The system upgrades will not be
completed until December 2005 and it is not clear when all caseworkers
will receive laptops.

o 	DMH has increased the mental health services available to foster care
children, including the number of assessments completed and the treatment
services offered through the mental health system. However, the department
faces ongoing challenges in building the capacity to provide needed
assessments and in securing long-term funding for treatment.

o 	COG worked with FAPAC to establish a respite program, but its
implementation was hampered because the plans did not factor in enough
time for training families or completing background checks. As of June
2005, while 106 children had participated in six Saturday day-

time respite programs, only seven families had completed the licensing
process and were therefore eligible to provide overnight respite. COG has
taken steps to improve the program, but the organization may find it a
challenge to recruit, train, and license enough qualified persons to
volunteer to serve as respite providers and to convince foster parents to
participate.

We received written comments from CFSA, DMH, and COG. CFSA agreed in
general with our findings and provided comments and additional
information. DMH's comments addressed information on delays in assessments
and service delivery capacity. In its comments, COG said that recruiting
the families to provide respite has not been a challenge. COG also said
that the challenge has been keeping volunteers' level of enthusiasm
through the arduous and lengthy licensing process. In addition, CFSA and
FAPAC provided technical comments to clarify the report. We have
incorporated this information as appropriate. See appendixes II, III, and
IV, respectively, for the written comments from the CFSA, DMH, and COG.

Background	The child welfare system is designed to promote the well-being
of children by ensuring their safety and by strengthening families to
enable them to successfully care for their children. Generally, families
become involved with the child welfare system after a report of abuse or
neglect has been made and confirmed. When agency officials determine that
a child may be further harmed or mistreated if left in the home, the child
is placed in foster care.

The federal government has allocated about $7 billion each year to
investigate abuse and neglect of children in this country, provide
placements to children outside their homes, and deliver services to help
keep families together. Part E of title IV of the Social Security Act
(title IV-E), as amended, is a major source of federal funding and is
primarily used to pay for the room and board of children in foster care.

Child welfare caseworkers are at the core of the child welfare system.
They are responsible for overseeing individual cases and for performing
many critical tasks such as arranging placements when children must be
removed from their homes, visiting children and foster families,
maintaining records on each case, and coordinating with other agencies to
obtain services for the children and their families. Child welfare
agencies face challenges in recruiting and retaining caseworkers. We
previously

reported that low salaries hinder agencies' abilities to attract and
retain them.7 We also found that high caseloads, administrative burdens, a
lack of supervisory support, and insufficient time for training were
issues that affected caseworkers' abilities to work effectively and their
decisions to stay in or leave the child welfare profession.

CFSA is responsible for managing the child welfare system for the District
and it relies on services provided by other District government agencies
in order to achieve its mission. For example, the Fire Department and the
Health Department inspect homes and facilities where foster children are
placed as part of the licensing process to ensure these homes are safe,
and the Department of Mental Health provides mental health services to
children in CFSA's care. In addition, CFSA works with child welfare
agencies in other states to arrange for placements of the District's
children in cases where the most appropriate foster or adoptive family
lives outside the District. CFSA also works with private agencies to place
children in foster and adoptive homes, and with private vendors to obtain
needed services and supplies. CFSA uses an automated case management
system, known as FACES, to track each child's case, including services
rendered or supplies obtained. FACES is also used to record and authorize
payments for such services through an interface with the District's core
financial management system, known as SOAR. CFSA receives title IV-E
funding as well as other federal, local, and private funds to support its
programs.

CFSA had a history of managerial deficiencies that led the U.S. District
Court for the District of Columbia to issue a remedial order in 1991 to
improve the performance of the agency, and then in 1995, due to
insufficient evidence of program improvement, the agency was placed in
receivership.8 After almost 6 years of federal receivership, CFSA was
reorganized as a District cabinet-level agency. Since that time, it has
worked to improve services and promote the safety and well-being of
children and families. The U.S. District Court appointed the Center for
the Study of Social Policy (CSSP) to monitor and assess CFSA's
performance. CSSP and we have reported that the management and operations
of CFSA

7GAO, Child Welfare: HHS Could Play a Greater Role in Helping Child
Welfare Agencies Recruit and Retain Staff, GAO-03-357 (Washington, D.C.:
Mar. 31, 2003).

8The receivership was an arrangement in which the U.S. District Court
appointed a person to temporarily manage the agency with broad authority
to ensure full and expeditious compliance with requirements established by
the court.

have improved since the receivership, but also found that matters of
concern remained.9

The District's mental health agency was similarly placed in receivership
for over 5 years, from 1997 to 2002.10 As originally established, the
District's mental health system was not organized or funded to meet the
particular needs of children, youth, and their families. When DMH took the
place of the Commission on Mental Health Services in 2001, it had too few
providers to accommodate the needs of the District's foster care children.
Mental health services-both assessments and treatment-are considered
critical for children who have suffered abuse or neglect; therefore, to
better connect foster care children with such services, CFSA began to
contract directly with mental health providers.

Over the years, the Congress has enacted laws and provided funds to help
improve the District's child welfare system. For example, the District of
Columbia Family Court Act of 200111 established the D.C. Family Court
dedicated solely to matters concerning the District's children and
families. The D.C. Family Court has jurisdiction over cases involving
alleged child abuse and neglect, juvenile delinquency, domestic violence,
child support, and other family matters. In addition to establishing the
Family Court, the Congress authorized funds to the District in fiscal year
2002 for the completion of a plan to integrate the District's computer
systems with those of the D.C. Family Court and for CFSA's caseworkers to
help

9GAO, D.C. Child and Family Services: Better Policy Implementation and
Documentation of Related Activities Would Help Improve Performance,
GAO-03-646 (Washington, D.C.: May 27, 2003); Center for the Study of
Social Policy, LaShawn A. v. Williams: An Assessment of the District of
Columbia's Progress as of September 30, 2003 in Meeting the Implementation
and Outcome Benchmarks for Child Welfare Reform (Washington, D.C.: Feb. 9,
2004).

10The U.S. District Court for the District of Columbia placed the D.C.
Commission on Mental Health Services, DMH's predecessor agency, in
receivership in 1997. The first receiver began his appointment in October
1997 and resigned in March 2000. The court then issued a consent order
establishing a transitional receiver to develop a plan for the District to
resume full control of its mental health system. This transitional
receivership was terminated in May 2002, and the court appointed a monitor
to oversee the District's implementation of the plan.

11Pub. L. No. 107-114, 115 Stat. 2100 (Jan. 8, 2002).

implement family court reform.12 Also, the District of Columbia
Appropriations Act, 2004,13 included a fiscal year 2004 federal payment of
$14 million to CFSA, DMH, and COG for improvements to specific foster care
programs.14 The federal funds were supplemented by private funds for
CFSA's early intervention program and COG's respite care and foster parent
recruitment program. In February 2004, the District and COG submitted
their respective plans to the Congress, outlining how they intended to use
the foster care improvement funds. Table 1 summarizes the purposes for the
funds as designated in the appropriations act and the planned expenditures
as listed in the spending plans.

12Pub. L. No. 107-96, 115 Stat. 923, 929 (Dec. 21, 2001). For more details
on the planned reform practices in the District's Family Court, see GAO,
D.C. Family Court: Additional Actions Should Be Taken to Fully Implement
Its Transition, GAO-02-584 (Washington, D.C.: May 6, 2002).

13Pub. L. No. 108-199, Div. C, title 1, 118 Stat. 3, 111. (Jan. 23, 2004).

14Subsequently, for fiscal year 2005, the Congress provided about $5
million in additional funding for foster care improvements in the
District. These federal funds were made available for specific programs to
CFSA, DMH, and COG until expended. The appropriations act provided (1)
$3,250,000 for CFSA's early intervention program, the emergency support
fund, and technology upgrades; (2) $1,250,000 for DMH to provide all
court-ordered or agency-required mental health screenings, assessments,
and treatments for children under the supervision of CFSA; and (3)
$500,000 for COG to continue a program in conjunction with the Foster and
Adoptive Parents Advocacy Center, to provide respite care for and
recruitment of foster parents. Pub. L. No. 108-335, 118 Stat. 1322, 1326
(Oct. 18, 2004).

  Table 1: Purposes and Plans for the Fiscal Year 2004 Foster Care Improvement
                    Funds Public law 108-199 Spending plans

    Organization                     Federal     Proposed 
      and total                                           
       funding        Purpose of       funds expenditures     Description     
                       funding                            
                                       $2                   Personnel costs   
      Child and    To establish an  million                   (salaries &     
       Family           early                    $700,000      benefits)      
                   intervention                           
Services Agency program to                             
                   provide                                
                    intensive and                         
                      immediate                           
     $9 million      services to                          
                   foster children.                       
                                                  500,000    Training and     
                                                            communications    
                                                           Meeting expenses   
                                                  200,000 (e.g., facilities & 
                                                            transportation)   
                                                                 Services for 
                                                                 children and 
                                                  530,000   families that are 
                                                          not currently       
                                                          available at        
                                                          sufficient levels   
                                                           (e.g., substance   
                                                           abuse treatment)   
                                                   70,000      Overhead       

To establish an emergency $1 million $920,000       Emergency expenses for 
                                                             relatives (e.g., 
    support fund to purchase                      furnishings & home repairs) 
    necessary items to allow                     
children to remain in the                     
                     care of                     
        a licensed, approved                     
                      family                     
                     member.                     

          73,000 Personnel costs (salaries & benefits) 7,000 Overhead

To establish a loan $3 million $2,750,000      Student loan repayments for 
             repayment                                              qualified 
           program for                          caseworkers with master's and 
          caseworkers.                                             bachelor's 
                                                 degrees to accept and extend 
                                                                 their tenure 
                                                            with the District 
                                                  Contract for loan repayment 
                                     250,000                          program 
                                                    design and administration 

To upgrade (FACES) computer $3 million $2,170,000         Upgrade FACES to 
                                                                    Web-based 
database and technology as                              architecture       
well as to provide computer                       
technology for caseworkers.                       

830,000	Computer technology for social workers (e.g., new laptops or
tablet PCs)

Department of Mental $300,000 Staffing of project team to oversee the

Health 	implementation and coordination of all program services outlined
below

$3.9 million

To provide all court-ordered or 1,030,000 Costs for expanded hours of
psychiatrists
agency-required mental health and psychologists
screenings and assessments
for children under the
supervision of CFSA.

(Continued From Previous Page)

                       Public law 108-199 Spending plans

Organization and total Federal Proposed funding Purpose of funding funds
expenditures Description

70,000 Staff and home visits/assessments

47,000 Supplies and materials

1,725,000	Mobile crisis and community-based intervention teams to provide
immediate assistance

Community support teams to provide a range of interventions to high risk
children involved in multiple systems

Community treatment setting for older adolescents who are aging out of
care

Specialized therapy and child traumatic stress treatment

150,000	Staffing coordination between DMH and CFSA

                                578,000 Training

Washington To develop a program in Although COG presented a detailed
spending plan, it did not include a Metropolitan Council of conjunction
with the Foster and breakdown of expenditures. The plan indicated that COG
would (1) Governments Adoptive Parents Advocacy provide services for
resource parents caring for children in the D.C. child

                     Center to provide welfare system, (2) recruit and train  
                          respite care respite care families to care for      
                                       foster                                 
$1.1 million for and recruitment of children covering emergency, planned,  
                                foster or ongoing respite care situations,    
                                        and (3) assist CFSA in developing a   
                       parents.           recruitment video and purchasing    
                                           media ads targeted to demographics 
                                            most likely to look after special 
                                                                        needs 
                                              children in foster care.        

Source: District of Columbia government and the Metropolitan Washington
Council of Governments.

CFSA, DMH, and COG Obligated and Spent Funds for Purposes Consistent with
the Appropriations Act and Spending Plans, but Some Funds Were Not Used

We found that CFSA, DMH, and COG obligated and expended the federal funds
provided for foster care improvement for purposes consistent with the
appropriations act and organizations' spending plans. The funds were used
for authorized expenses such as repairs for foster homes, student loan
repayments, psychiatric evaluations, staff salaries for the family team
meeting project, and training and education materials. For a comparison of
agency spending plans to provisions of the appropriations act, see table
1. Additional information about the programs is provided in later sections
of this report.

On March 17, 2004, the District received the $14 million federal payment,
less a 0.59 percent rescission, for a total of about $13.9 million.15 The
District sent COG a payment of $1,093,510, as specified by the
appropriations act. The availability of the federal payment of funds
received by the District for foster care improvements was limited to
fiscal year 2004. Any unobligated balances of funds after September 30,
2004, were no longer available for the District's use and should revert to
the general fund of the U.S. Treasury. When the District disbursed funds
to COG for its use, the funds lost their federal payment character; thus
there is no fiscal time limitation on the use of the federal funds
provided to COG.

As we previously reported,16 only a small portion of the federal funds for
foster care improvements had been obligated or spent as of June 30,
2004.17 At that time, over $12.4 million of the $13.9 million provided
remained unobligated. However, as of September 30, 2004, the District
agencies and COG had obligated about $12.6 million of their funds. Since
then COG has obligated an additional $599,000, bringing the total amount
of funds obligated as of March 31, 2005, to $13.2 million. As of March 31,
2005, about $6.2 million of the total obligated funds had been expended
and about $722,524 remained unobligated. The unobligated funds for CFSA
and DMH, in the amounts of $588,859 and $30,545 respectively, ceased to be
available for new obligations after September 30, 2004, and should revert
to the general fund of the U.S. Treasury. COG's $103,120 in federal
funding remains available for use in the respite program for foster
parents of District children. Table 2 provides details on the amounts of
the organization's obligations as of March 31, 2005.

15Section 168 of Division H of the Consolidated Appropriations Act, 2004,
Pub. L. No. 108199, included a provision for an across-the-board 0.59
percent rescission to be deducted from the budget authority provided for
any discretionary accounting in the act.

16GAO-04-1017.

17GAO-04-1017.

Table 2: Funds Received, Obligated, and Unobligated by CFSA, DMH, and COG, as of
                                 March 31, 2005

                                                                        Funds 
                                        Obligations               unobligated 
                                               as a                      as a 
                            Total funds  percentage                percentage 
                                                 of                        of 
Organization    Funds      obligated       funds Funds not           funds 
                 received                  received obligated        received 
       CFSA      $8,946,900  $8,358,041       93.4%      $588,859        6.6% 
       DMH        3,876,990   3,846,445        99.2        30,545 
       COG        1,093,510     990,390        90.6       103,120 
      Totala    $13,917,400 $13,194,876       94.8%      $722,524        5.2% 

Source: GAO analysis of data from the District of Columbia government and
the Metropolitan Washington Council of Governments.

aNumbers do not sum to totals because of rounding. Percentages may not sum
to 100 because of rounding.

Internal Controls Are Generally Operating Effectively

In our testing at CFSA and DMH, we concluded that internal controls were
in place over obligations of the funding provided to both District
agencies to ensure that the federal funds were expended appropriately for
their intended purposes. Consistent with standards for internal control in
government,18 the agencies' internal controls comprise a series of
appropriate actions and activities conducted throughout the agencies'
operations on an ongoing basis. Internal control activities we tested
include (1) adequate segregation of duties so that no one person can
approve as well as execute a transaction, (2) approval of transactions by
appropriate supervisory officials, (3) sufficient documentation of
transactions, and (4) physical control over negotiable assets. Agency
fiscal officers are charged with providing oversight to ensure that
controls are adequate to provide reasonable assurance19 that funds
obligated and expended are used effectively and as intended, according to
the spending plans and the appropriations act.

18Internal control is an integral component of an organization's
management that provides reasonable assurance that the following
objectives are being achieved-effectiveness and efficiency of operations,
reliability of financial reporting, and compliance with applicable laws
and regulations. GAO, Standards for Internal Control in the Federal
Government, GAO/AIMD-00-21.3.1 (Washington, D.C.: November 1999).

19No matter how well designed and operated, internal controls cannot
provide absolute assurance that all agency objectives will be met.
Management should design and implement internal controls based on the
related cost and benefits. Therefore, internal control provides
reasonable, but not absolute assurance of meeting agency objectives.
GAO/AIMD00-21.3.1.

To test specific control activities at CFSA and DMH, we selected a
statistical sample of obligation transactions covering the period March
17, 2004, through September 30, 2004, in the sum of about $11.9 million20
from foster care improvement obligations of about $12.2 million. In
addition, we tested the District's supporting documentation for the $1.1
million transfer to COG. Based on the results of our tests, we concluded
that internal controls are generally operating effectively.21 Two key
internal control activities were built into the requisition and purchasing
processes by the Office of the Chief Financial Officer and Office of
Contracts and Procurement. We found that key duties and responsibilities
associated with the sample transactions were divided (segregated) among
different staff members so that no one person could both approve and fully
execute a transaction. Moreover, we found that key documents, such as
requisition and purchase orders, were authorized and executed by staff
members acting within the scope of their authority, and that the documents
supported the purpose and amount of the transaction. However, in
conducting our tests, we found three instances worth discussion. These
involved the need for sufficient documentation, better adherence to
operating procedures, and greater control over physical assets.

The first instance involved documentation that did not fully describe the
transaction and a negotiable asset that was potentially vulnerable to
misuse or fraud. In the transaction we tested, CFSA had recorded an
obligation in the emergency support fund in the amount of $9,375 for the
purchase of gift cards to be used to purchase clothing for foster
children. The transaction was part of a requisition that totaled about
$99,000 for the purchase of gift cards from several vendors. While the
approval of the gift card purchase was adequately documented, it was
unclear whether the gift cards were ever received because the District did
not provide us documentation of their receipt of the cards during the time
of our review. We were also unable to determine, based on District
records, whether the District had paid for the cards. District officials
told us that the gift cards had been received, paid for, and had not been
activated for use. However, without an invoice or receiving document, we
could not verify that the gift cards were

20The sample was selected based on a dollar-unit sampling methodology
which, by its nature, will tend to select large dollar unit items. See
appendix I for statistical sampling details.

21We are 95 percent confident that the upper error limit overstatement of
obligation transactions with ineffective controls is not more than $1.2
million. This estimate does not exceed the tolerable amount in error of
$2.0 million.

received or paid for, or whether the cards had been activated. In its
comments on a draft of this report, CFSA provided additional
documentation, including the vendor invoice and financial system reports
showing receipt of the gift cards and the payment made.

While gift cards provide the flexibility to respond quickly to emergency
needs, adequate documentation and sufficient physical controls are
essential to provide accountability over their use and to ensure the
propriety of transactions. Gift cards, similar to cash, can easily be used
for improper purchases-such as purchases excessive in cost, for purposes
other than that stated, or for personal use. Purchased gift cards need to
be properly inventoried and stored, similar to the cash in an imprest
fund.22 When the gift cards are distributed, the number and dollar amount
of the cards taken from the inventory should be noted as should the
identities of the employees who received the cards. Employees should be
required to provide receipts for items purchased with gift cards. Periodic
surprise audits of the gift card funds would also help to safeguard the
gift cards inventory. In its comments on a draft of this report, CFSA
described its procedures to track, monitor, and manage the distribution
process of the gift cards, including several actions recently taken and
planned actions designed to improve procedures in this area.

In the second instance, on September 28, 2004, DMH generated and issued a
purchase order for professional consulting services in the amount of
$221,637; however, a detailed contract was not executed until February 2,
2005. District officials told us that, according to operating procedures,
there should have been an approved purchase order and signed contract
before obligating funds. However, in order to obligate funds by September
30, 2004, the District told us that they issued a purchase order to which
the consultant agreed and both parties agreed to finalize the contract
later. District officials told us that they believe they had a valid
obligation based on the approved purchase order as agreed to by the
vendor, provided the vendor could meet all the detailed requirements
specified in the purchase order. They further explained that during the
months following the recording of the obligation, DMH officials negotiated
the final detailed deliverables with the vendor and signed the contract in
February 2005.

22An imprest fund is a fixed-cash or petty cash fund in the form of
currency or coin. The funds are charged against a government appropriation
by an agency official and advanced to an authorized cashier. The fund may
be revolving, replenished to the level of a fixed amount as spent or used,
or stationary such as a change-making fund.

However, the District did not provide us with evidence that the vendor
agreed to the purchase order. This type of procurement procedure increases
the risk that the District might lose obligated funds if it were to later
determine that the vendor could not meet the requirements indicated in the
purchase order. While the purchase order could be later cancelled,
expiration of the funds would prevent their reobligation. This type of
practice increases the risk to DMH that it may improperly record an
obligation where no binding agreement may exist at the time of recording
the obligation, as required by 31 U.S.C. S: 1501(a). See 34 Comp. Gen. 459
(1955).

Finally, a vendor's invoice billed the District for 248 laptop computers.
Initial documentation provided to us by CFSA showed a handwritten notation
on the invoice by the head of CFSA's Information Technology branch
acknowledged receipt of only 247 computers at a cost of $510,796. District
officials could not provide documentation to support the number of
computers received. Thus, we could not verify the number actually
received. Additional documentation provided with CFSA's comments on a
draft of this report show that the agency purchased 247 computers with the
federal funds for foster care improvements and 1 computer with local
funds, for a total of 248 laptop computers. While we did not test the
physical control environment at the District, our Standards of Internal
Control requires agencies to establish physical control to secure and
safeguard vulnerable assets to establish accountability, and to properly
record transactions.

We did not conduct detailed tests of transactions at COG because those
transactions were included in COG's financial statement audit performed by
an independent public accounting firm who audits COG's financial
statements annually. COG received an unqualified, "clean," opinion for
fiscal years ended June 30, 2004, and June 30, 2003. In COG's 2004
financial statements, the Foster Care Improvements federal funding of $1.1
million was recorded in the supplementary information-Project Statement of
Revenues, Expenditures, and Changes in Net Assets-and audited as part of
the financial audit. Furthermore, the independent auditor did not identify
any internal control weaknesses over financial reporting and operations or
any instances of noncompliance for purposes of the reports on internal
controls and compliance that are required by Government Auditing
Standards.23

23GAO-03-673G.

New Programs Have Been Implemented to Improve Foster Care, but Challenges
Remain

CFSA, DMH, and COG have implemented the programs and initiatives specified
in the appropriations act and spending plans, and some foster families
have received needed services. CFSA began its early intervention program a
few months later than it had planned. Nonetheless, funds from this
program, as well as the emergency support program funds have provided
needed services to some families. CFSA also established a student loan
repayment program, developed an information technology plan, and provided
laptops to some caseworkers. DMH increased the mental health services
available to foster care children, and COG and FAPAC worked together to
develop a respite program.

However, it is too early to assess the effectiveness of some programs, and
challenges remain for others. The long-term effectiveness of the early
intervention and student loan programs cannot yet be assessed and the
information technology improvements have not been completed. Furthermore,
challenges remain that could affect the success of CFSA's emergency
support fund initiative, as well as DMH's ability to build capacity to
provide needed assessments and to secure long-term funding for treatment.
Also, the future success of COG's respite program depends on some factors
beyond the organization's control.

Implementation of the Early Intervention Program Was Delayed, Nevertheless
Needed Services Were Provided to Some Families

The early intervention program included two key components-the Facilitated
Family Team Meeting (FFTM) initiative and funds for various services and
supports. According to agency officials, the FFTM initiative is the core
of the program. These meetings are intended to give families a voice in
decisions about removing a child from the home or changing his or her
placement. CFSA planned to begin holding meetings in the summer of 2004,
but implementation was delayed until September. CFSA officials stated that
much of the delay was the result of time needed to train the parties
involved in the program, including caseworkers, judges, and foster
parents. CFSA operated a pilot program from September to December 2004 for
selected high-risk cases. In January 2005, CFSA began conducting FFTMs for
all cases, and as of March 2005, CFSA had held 47 FFTMs for 85 children.
Based on the outcome of the FFTMs, CFSA officials are to assess the
families' needs and identify services and supports that may enable
children to remain safely in their own homes or with their current foster
families. Table 3 lists services and supports eligible for program funds.

Table 3: Eligible Services and Supports Provided through the Early
Intervention Program

                      Category Eligible services/supports

Social services  o  Substance abuse treatment

o  Intensive, home-based services, such as but not limited to: parenting
support, behavioral management, homemaker services, crisis intervention,
and or medical/behavioral support

o  Job training and support

Support services  o  Equipment to care for disabled children

o  Temporary transportation of children

o  Temporary child care

o  Temporary food assistance

o  Furniture

o  Clothing

Housing  o  A one-time security deposit or up to 3 months of rental
assistance

o  Temporary assistance with utility bills

o  Lead abatement

o  Home repair or maintenance

Special services  o  Individualized services that do not fall into one of
the categories above but that are necessary to minimize trauma for the
children

Source: CFSA program data.

Program data show that as of April 2005, CFSA provided 207 services and
supports to 151 families and 386 children with the early intervention
program funds.24 Most of the services provided were related to housing
needs such as rent, utility payments, and furniture, as shown in figure 1.

24CFSA transferred $75,000 from this fund to DMH for the Mobile Response
and Service Stabilization (MRSS) program. The MRSS program provides
services to manage crises and prevent children from moving from their
biological family or a kinship caregiver into foster care.

Figure 1: Types and Numbers of Services Provided to Families with Early
Intervention Program Funds

Other (33 of 207)

Utility (71 of 207)

Rent (52 of 207)

Furniture (51 of 207)

Source: GAO analysis based on CFSA program data.

Note: Other services provided included food, clothing, day care,
transportation, school supplies, onetime emergency room and board, summer
camp, vouchers for a baby monitor, and a U-Haul rental truck.

The early intervention program has been operating for several months, but
officials said that the effectiveness of the program cannot yet be
determined. Agency officials said that CFSA has developed a tracking
system to follow the progress of FFTM participants and will have data to
determine whether the program has reduced the number of children coming
into CFSA's care or the number of times a child's placement is changed.

Emergency Support Fund Provided Critical Services, but the Number of
Unlicensed Homes Remained the Same

One goal of the emergency support fund is to help facilitate the licensing
of family members who are willing to provide kinship homes25 to care for
children who would otherwise go into traditional foster homes or
congregate care.26 According to CFSA officials, the funds could be used to
help homes meet established standards by paying for expenses such as lead
abatement, home repairs, and renovation. In addition, the funds could be
used to purchase services and items such as child care services or
clothing, as well as to provide housing assistance in the form of monthly
rent (not more than three months) or one-time security deposits.

Although efforts to advertise the funds were limited, several families
learned about and received services from this program. Kinship families
learned about the availability of funds through information provided by
caseworkers, word of mouth from other parents, and announcements in
FAPAC's newsletters for foster parents. As of April 2005, 99 families and
189 children had been helped by the emergency support fund and 152
services had been provided. Furniture, rent, and utility assistance were
most often provided; however, families received other services as shown in
figure 2. FAPAC officials said that the program has been helpful and
beneficial in helping kinship foster families become and remain licensed
foster families.

25Kinship homes are those in which a relative or unrelated person with
long-standing ties to the child provides care for a child that has been
neglected, abused, or is at risk for neglect and abuse.

26Congregate care homes include group homes, independent living placements
(ILPs), and therapeutic facilities. Group homes provide services to
children in large family-type settings, ILPs are monitored apartments for
teens who are preparing to live independently, and therapeutic facilities
offer specialized medical and mental health care for children and teens.
Congregate care facilities are designed to provide placement for children
who have not done well in the family setting or for those awaiting
placement with traditional foster families.

Figure 2: Number and Types of Services Provided to Families with Emergency
Support Funds

Other (51 of 152)

One time room and board payment (15 of 152) Utility (22 of 152)

Rent (30 of 152)

Furniture (34 of 152)

                Source: GAO analysis based on CFSA program data.

Note: The "other" category includes a wide variety of services such as
home repairs, summer camp, CPR/First Aid Certification, vehicle repairs,
clothing, and day care services.

While the emergency support fund has assisted some families, the number of
unlicensed homes has not changed in the last year. We previously
reported27 that CFSA had taken a number of steps to ensure that children
are placed in licensed homes, but as of May 2004, 495 children, or 22
percent of the children in CFSA's care, were in 308 unlicensed homes. At
that time, CFSA officials told us that the majority of unlicensed homes
entered the foster care program before new licensing standards were
issued, many were kinship homes, and many homes were located in Maryland.
Agency officials also said that CFSA was working to correct this situation
by examining these homes on a case-by-case basis to identify the specific
barrier each home faced in becoming licensed and, if possible, to resolve
the issue. As of April 30, 2005, CFSA had children in 309 unlicensed
homes. CFSA officials explained that most of the unlicensed homes were

27GAO-04-1017.

not kinship homes and therefore federal funds were not available to
facilitate licensing of these homes. 28 Further, according to CFSA
officials, most of the unlicensed homes were in other jurisdictions-232 in
Maryland and 33 in other states. CFSA, like child welfare agencies in
other jurisdictions, is faced with challenges when trying to ensure the
quality of homes outside their respective jurisdiction. When children are
placed in homes in other jurisdictions, the home study process29 is
complicated because the two states' laws and policies must be taken into
consideration and there must be coordination between the jurisdictions.
The Interstate Compact on the Placement of Children30 is the bridge that
facilitates this process by providing a legal and administrative framework
for placing children across state lines for foster care or adoption.
However, concerns have been raised by state child welfare officials about
the timeliness of home studies and the quality of background checks done
by staff in other jurisdictions.

Most Eligible Caseworkers Participated in the Student Loan Repayment
Program, but More Could Have Been Supported

About 70 percent of CFSA's eligible caseworkers participated in the
student loan repayment program and most were approved for payments of more
than $10,000. CFSA determined that only those caseworkers who managed
cases were eligible to apply for the program. As of August 2004, CFSA had
310 caseworkers, and according to agency officials, 190 of them managed
cases. CFSA officials reported that 138 of its 190 caseworkers and nine of
its contractors signed student loan repayment agreements. Most program
participants, 99, had fewer than 3 years of service and 48 had 3 years or
more of service. The repayment amounts ranged from about $3,000 to about
$18,000 with the average at about $15,000. According to CFSA documents,
the first payment will be made in July 2005 for those who have

28CFSA issues temporary licenses to kinship homes in the District;
therefore, these homes are counted as licensed.

29A home study is the process of assessing and preparing families to
determine their potential to become either foster or adoptive parents.

30Interstate Compact on the Placement of Children (ICPC) is a uniform law,
enacted in all 50 states, the District of Columbia, and the U.S. Virgin
Islands, that governs the interstate placement of children in foster and
adoptive homes. Under ICPC, the state from which a child is sent retains
jurisdiction over the child and his or her placement. ICPC ensures that
children placed from one state into another receive adequate protections,
services, and supervision.

met the service requirements.31 Figure 3 summarizes the distribution of
these loans.

Figure 3: Distribution of Student Loan Repayment Amounts

                           Number of caseworkers 102

$5,000 or less

                $5,001 - 10,000 $10,001- 15,000 $15,001- 18,000

Source: GAO analysis based on CFSA program data.

Although 138 of 190 caseworkers were approved for loan repayments, more
could have been supported with the funds available. At the end of the
fiscal year, CFSA had about $408,000 remaining of the $3 million
designated for the program. CFSA could have entered into agreements with
more than 40 caseworkers with bachelor's degrees in social work (BSW) or
more than 20 with master's degrees in social work (MSW) or some
combination of both. According to agency officials, the agency took
several steps to make certain that all eligible caseworkers were aware of
the program, and they modified the program in an effort to maximize
participation. CFSA

31According to the terms of the program, CFSA pays one-half of the
repayment amounts at the end of the caseworkers' 3rd year and the
remaining half at the end of the 4th year. Those with more than 4 years of
service must agree to remain with the agency at least 1 more year.

launched the program in June 2004. CFSA advertised the program through
weekly e-mail messages to all caseworkers, distributed flyers, printed
notifications in an agencywide newsletter, posted fact sheets on the
District government's intranet, and placed notices in local newspapers,
including the Washington Post. CFSA extended the application deadline by a
month and increased the maximum amount of the loan repayment from $5,000
to $10,000 for caseworkers with BSWs and from $10,000 to $18,000 for those
with MSWs. As the program is structured, if a caseworker who was approved
to receive a loan repayment leaves CFSA before the end of his or her
commitment, the agency will have to return the funds to the U.S. Treasury.
Agency officials said that one reason more caseworkers did not participate
in the program was their hesitance to commit to working for CFSA on a
long-term basis. In commenting on a draft of the report, agency officials
also said that all of the funds for the student loan repayments were not
used because the agency could neither advertise the program nor enroll
participants until after March 2004 when the funds were made available,
which was after the height of its spring recruitment season at colleges
and universities.

Even with this program, attrition rates at CFSA increased. Like other
child welfare agencies, CFSA has faced ongoing challenges in efforts to
retain caseworkers. In fiscal year 2003, CFSA's attrition rate for
caseworkers was about 15 percent. In fiscal year 2004, the rate had
increased to about 18 percent. In our September 2004 report,32 we found a
consensus among the caseworkers we interviewed that deficiencies in CFSA's
management practices33 hindered their performance and lowered their
morale. In that report, we recommended changes to CFSA management
practices. CFSA generally agreed with our recommendations and developed a
work plan that included strategies to help retain qualified caseworkers.
We have not assessed whether the agency has begun to implement the
recommendations. Although the attrition rate has increased, it is too soon
to tell whether the student loan repayment program will be effective in
the long-term, particularly since all participants had to remain at CFSA
at least until July 2005.

32GAO-04-1017.

33Deficient management practices cited were poor communication, a lack of
resources, poor supervision, and no program for rewards and recognition.

Implementation of CFSA's CFSA developed an information technology plan to
upgrade its child Information Technology welfare information system, known
as FACES, to a Web-based system. Plan Is Not Yet Completed The information
technology plan indicates that the FACES software

upgrade component is scheduled to be completed in December 2005. In
addition, the contractor may provide maintenance and support services for
the new system through September 29, 2008. Table 4 summarizes the key
steps in the plan and the related time frames.

Table 4: Key Steps in CFSA's Information Technology Plan, as of June 15,
2005

                                   Task Planned initiation Planned completion 
          Consulting contract for FACES                                       
                               software            3/30/04           12/20/05
                                upgrade                    
            Web application servers and            9/20/04           12/20/05 
                               hardware                    
               Web development software            9/20/04           12/20/05 
           Staff training and materials            9/20/04           12/20/05 
            Purchase laptops for social            5/28/04            9/30/04 
                                workers                    
                  Security enhancements            9/20/04           12/20/05 
                    Business continuity                                       
                           enhancements            7/15/04            9/30/04

Source: CFSA program data.

Also, CFSA's information technology plan includes the purchase of laptops
for its caseworkers. These laptops are intended to help improve
caseworkers' productivity and effectiveness because caseworkers can enter
case information data when away from the office. According to the spending
plan, CFSA would initially purchase laptops for 75 percent of its
caseworkers and in phase two, laptops would be purchased for the remaining
25 percent who had less critical need for field access. However, it is not
clear when all caseworkers will receive laptops because the date for
beginning of phase two is not listed in either the spending plan or the
information technology plan and CFSA officials could not provide a date
for this phase.

CFSA purchased and received the initial order of laptops as planned, but
the distribution process has taken months. The final contract, signed on
September 29, 2004, allowed for CFSA to purchase laptops and related
services at a cost of about $2,000 per laptop. On January 27, 2005,
documents showed that 247 laptops had been purchased with federal funds-9
for FFTM caseworkers that manage the early intervention

program and the remaining 238 to be distributed among CFSA's 310
caseworkers. According to CFSA officials, as of May 2005, 119 laptops had
been issued to caseworkers and they expected that all laptops would be
distributed by June 2005. CFSA explained that distribution was delayed
because initially the laptops did not meet the requested memory
specifications. CFSA further explained that after the contractor replaced
the memory modules, the agency had to load the software before the laptops
were distributed.

Mental Health Assessments and Treatments Were Provided, but DMH Faces
Ongoing Challenges

DMH provides assessments for children referred to the agency by CFSA and
the Family Court. From August 2004 through February 2005, DMH reported
completing 351 assessments of foster care children referred by CFSA.
During the same period, CFSA increased the number of cases referred to DMH
for assessment from 15 in August 2004 to 68 in February 2005, for a total
of 292 referrals over the 7-month period.34 According to DMH officials,
this sharp increase in referrals has raised the average number of days to
complete an assessment-beginning with the appointment request and ending
with the delivery of a report to the Family Court-above the statutory time
frame of 23 days as indicated in the appropriations act.35 DMH reviewed 82
cases completed from August 2004 through February 2005 and found that
their evaluators took an average of 33.5 days-approximately 10 days longer
than the statutory time frame-to complete assessments. According to DMH
officials, some cases increased the average time frame for completion. For
example, one case took 192 days. However, officials also acknowledged that
the remaining assessments, while sometimes taking as little as 1 day to
complete, were, on average, not being completed within the statutory time
frame.

Since our September 2004 report, DMH has continued to build its capacity
to provide treatment to foster care children referred by CFSA.36 DMH has
increased the number of outside providers it has certified to deliver

34CFSA contractors continued to provide some needed assessments. From
August 2004 through February 2005, approximately 40 percent of referrals
for assessments were sent to CFSA contractors.

35These time frames require DMH to initiate services within 3 days of
notification, complete assessments within 15 days of the request, and
provide the Family Court with assessments within 5 days of completion. 118
Stat. 116.

36GAO-04-1017.

treatment to foster care children from 13 in September 2004 to 20 in
February 2005. From August 2004 through February 2005, CFSA referred 430
cases to providers in the DMH network. In January 2005, DMH providers
began delivering three new types of treatment to foster care children, (1)
multisystemic therapy, (2) intensive home-and communitybased services, and
(3) mobile response and stabilization services.37 DMH previously
anticipated that 300 to 500 children would receive these three types of
treatment within 1 year of the date of the signed agreements with
providers.38 Agreements for these treatment services were signed in late
September 2004. As of April 2005, 3 months into implementation of the new
types of treatment, 31 children had received multisystemic therapy, 37 had
received intensive home-and community-based services, and 24 had received
some type of mobile mental health services (see table 5). According to a
DMH official, the department expects 300 children to receive services by
January 2006.

Table 5: Foster Care Children Receiving Mental Health Treatment

 Number of foster care children served Mental health treatment As of April 2005
                          Anticipated by January 2006

                       Multisystemic therapy 31 64 to 96

Intensive home-and community-based services

  37 72 to 90 Mobile response and 20 calls (emergency 12 to 14 calls per week
                       (emergency stabilization services

assistance) 4 families (stabilization)

                       assistance) up to 10 cases at one time (stabilization)

Source: DMH and documents from U.S. District Court for the District of
Columbia.

In addition to adding providers and new types of treatment, DMH began its
initiative to train providers in trauma treatment in March 2005. The first
phase of this initiative included a baseline assessment of whether
providers

37Multisystemic therapy is treatment delivered in homes and the community
for foster care youth with complex clinical, social, and educational
problems. Intensive home-and community-based services are provided by a
team of professionals and are available 24 hours a day and 7 days a week.
The mobile response and stabilization services are provided at the site of
a child's escalating behavior.

38GAO-04-1017.

use treatment practices that reflect current research. In the second
phase, DMH began offering training sessions on those treatment practices
for DMH's certified providers.

DMH faces ongoing challenges in building the mental health system's
capacity to provide timely assessments and in securing long-term funding
for treatment services for foster care children. As of April 2005, DMH
officials reported that it did not have the capacity to respond to the
growing number of referrals for assessments from CFSA.39 To address this
issue, DMH officials stated that the agency was expanding its current
contracts with providers and recruiting new providers. However, according
to DMH's director, meeting the demand for assessments will remain an
ongoing concern. With regard to treatment, DMH is in the process of
securing longterm financing for the new services implemented with the
federal funds. DMH officials stated that the agency can obtain funds for
mobile response and stabilization through the District's Medicaid program.
40 Officials also expect that, upon approval of a requested change to the
Medicaid program, DMH will be able to obtain reimbursements for intensive
home- and community-based services and mobile response and stabilization
services. The director said that, even with the federal funds available
through Medicaid, local funds may not be sufficient to meet the treatment
needs of foster care children.

COG's Respite Program Was COG, in conjunction with CFSA and FAPAC,
developed a respite program More Challenging to for foster parents of the
District's children. Under this program, known as Implement Than Expected
"Work of Heart," COG recruited and trained families from the District and

other surrounding jurisdictions to provide volunteer respite care. The
program was designed to include overnight respite care provided by
licensed foster parents, as well as daytime respite programs on Saturdays
and Sundays provided by licensed organizations.

39According to a Family Court official, the total number of cases being
referred for assessments and other services has been constant since
receipt of the federal funds in March 2004; however, the number being
referred to DMH has increased.

40Medicaid is a jointly funded federal-state program that pays for medical
assistance for certain low-income families and individuals who meet
certain criteria. With federal approval, Medicaid will reimburse states'
expenditures for certain types of rehabilitative services such as
community-based treatment.

COG used various avenues to recruit parents to serve as respite providers
and made several efforts to inform foster parents about the respite
program. According to agency officials, to recruit respite providers COG
staff attended 10 community fairs, made 11 presentations at churches and
businesses, hosted bimonthly informational meetings, and explained the
program to CFSA caseworkers. In addition, COG distributed more than 50,000
recruitment brochures and flyers and advertised through local radio, local
journals, and newspapers to recruit respite providers. COG also conducted
outreach efforts to inform current foster families about the availability
of respite services. They sent four mailings to all of CFSA's foster
families and instituted an application and approval process. Current
foster parents had to complete the application and be approved in order to
receive respite services. Furthermore, FAPAC officials coordinated the
identification and approval of four licensed organizations to provide the
daytime respite programs.

Some respite services have been provided; however, COG's initial goal was
not met. We reported in September 200441 that COG had set as its goal to
provide 700 respite care placements by March 2005, but officials did not
know how many parents would need to be licensed to reach that goal or how
many children would need care. As of June 2005, 62 respite foster parents
had been trained, and 7 had completed the licensing process. Also as of
June 2005, 44 foster families and 86 foster children-their ages ranged
from 6 months to 17 years of age-had been approved to receive respite.
According to COG officials, six Saturday respite programs were held and
106 children participated. For overnight respite, 26 placements were
requested and 9 were completed as of June 2005. COG officials said that
the other requests were cancelled by the foster parents for various
reasons.

COG's initial plan did not adequately consider several factors that
hindered the program's implementation. For example, COG officials stated
that the initial program goal was overly optimistic because it was based
on a longrunning program operating in another state but did not account
for differences between the District's needs and demographics and those of
that state. The COG officials also said that the District's training
requirements were longer than projected and some parents who were
interested in serving as respite volunteers were hesitant to complete the
lengthy application and licensing process. Furthermore, COG officials
stated that a major barrier to the program was the 3 to 4 month waiting

41GAO-04-1017.

period for FBI clearances, part of the licensing process. A COG official
explained that they were working with the Washington FBI field office and
the Metropolitan Washington Police Department to finalize a memorandum of
understanding that could reduce the time for clearances to 4 to 5 weeks.
While this step may help improve the process, the future success of the
program depends on some factors beyond COG's control such as the number of
qualified people who volunteer to serve as respite providers and the
number of foster parents who will participate.

Concluding	CFSA, DMH, and COG have obligated federal funds for purposes
intended by the Congress to address long-standing problems in the
District's foster

Observation 	care system. The agencies and COG appear to have exercised
effective internal controls over the use of those federal funds. All
programs called for in the legislation have been implemented to some
degree, and services have been provided to some foster children and
families in the District. As in child welfare systems across the country,
the agencies and organizations working for the welfare of children in
foster care face a complex set of challenges. Whether these programs are
effective and help improve foster care in the District may not be known
for several years.

Agency Comments and Our Evaluation

We received written comments on a draft of this report from CFSA, DMH, and
COG. These comments are reprinted in appendixes II, III, and IV,
respectively. CFSA and FAPAC also provided technical comments, which we
incorporated where appropriate.

In commenting on a draft of this report, CFSA agreed in general with our
findings and provided a number of comments and additional information. In
response, we made several changes to the report. We revised the report to
reflect the additional documentation provided by CFSA showing (1) receipt
of the gift cards and the payment made and (2) the purchase of one
additional laptop computer. CFSA also described its procedures to track,
monitor, and manage the distribution of the gift cards, which we noted in
the report. Also, we added a statement in the report explaining how the
timing of the receipt of funding impacted CFSA's ability to use all of the
funds for the student loan repayment program and revised the information
technology section of the report after receiving and reviewing an updated
plan from CFSA. In addition, CFSA's comments addressed the goals of the
emergency support program and its unlicensed homes. CFSA stated that,
while the emergency support funds were used to facilitate licensing of

kinship homes, the primary goal of the emergency support program goal was
to facilitate placement of children with kin. We did not revise the
statement about the program goal, because the appropriations act and the
related conference report state that the fund would be used to purchase
items necessary to allow children to remain in the care of an approved
licensed family member. With regard to its unlicensed homes, we revised
the report to reflect some of the information provided by CFSA.

We also received written comments on a draft of this report from DMH that
addressed information on delays in assessments and the department's
capacity to deliver treatment services. DMH generally agreed with our
findings on the provision of assessments, but provided additional
information on increases in referrals, delayed assessments, and
initiatives to decrease the wait time for assessments. DMH also expressed
the view that it has the capacity to utilize Medicaid funding for
treatment services. We modified the report to reflect that DMH is in the
process of securing long-term funding for treatment services.

In its comments, COG said that recruiting the families to provide respite
has not been a challenge. COG also said that the challenge has been
keeping volunteers' level of enthusiasm through the arduous and lengthy
licensing process. We modified the report to clarify that our conclusion
included all aspects of the process associated with licensing respite
providers.

We will send copies of this report to the Director of CFSA, the Director
of DMH, the Executive Director of COG, and the Chief Financial Officer of
the District of Columbia. We are also sending copies to the Honorable
Senator Michael DeWine, who was the Chairman of the Subcommittee on the
District of Columbia Senate Committee on Appropriations when the act was
passed that provided the federal funds; to appropriate congressional
committees; and other interested parties. We will also make copies of this
report available to others on request. In addition, the report will be
available at no charge on GAO's Web site at http://www.gao.gov.

If you or your staff have any questions about this report, please contact
Jeanette Franzel, Director, Financial Management and Assurance, at (202)
512- 9471 or [email protected], or Cornelia M. Ashby, Director, Education,
Workforce, and Income Security Issues, at (202) 512-8403 or
[email protected]. Contact points for our Offices of Congressional Relations
and Public Affairs may be found on the last page of this report.

GAO staff that made major contributions to this report are listed in
appendix V.

Jeanette Franzel
Director
Financial Management and Assurance

Cornelia M. Ashby
Director
Education, Workforce, and

Income Security Issues

Appendix I

Scope and Methodology

To assess whether the federal funds were being obligated and expended by
the Child and Family Service Agency (CFSA), Department of Mental Health
(DMH) and the Metropolitan Washington Council of Governments (COG)
consistent with the provisions in the District of Columbia Appropriations
Act, 2004, and the spending plans that were submitted to the Congress, we
interviewed District and COG officials responsible for overseeing,
monitoring, and tracking the federal funds received for foster care
improvements. We reviewed and analyzed the District and COG spending plans
and budgets, and internal reports of obligations and expenditures.

To determine whether internal controls are operating effectively, we
interviewed financial and program personnel from CFSA, DMH, COG, and from
the District government's central Office of the Chief Financial Officer.
We reviewed operating procedures and flowcharts to understand the
procedures and controls over the use of the funds. To further understand
the District's processes for obligating and disbursing funds, we conducted
walk-throughs of the procedures with CFSA and DMH financial officials.

We assessed the reliability of the District's foster care obligations data
by (1) reviewing existing documentation related to the data sources, (2)
testing the data to identify obvious problems with completeness or
accuracy, and (3) interviewing knowledgeable agency officials about the
data. We determined that the data were sufficiently reliable for the
purposes of this report.

We selected a dollar-unit sample at a 95 percent confidence level of CFSA
and DMH obligation transactions covering the period March 17, 2004,
through September 30, 2004, totaling about $11.9 million from obligations
of about $12.2 million to test specific control activities, such as
segregation of duties, evidence of approving official review and approval,
and adequacy of supporting documentation.1

We also reviewed contract files to validate that the responsible
designated officials within the agency provided the appropriate budget
authorizations to purchase and receive goods and services consistent with
the appropriations act and whether the goods or services rendered were
properly obtained and the quantity and quality of services were verified.

1We are 95 percent confident that the upper error limit overstatement of
obligation transactions with ineffective controls is not more than $1.2
million. This estimate does not exceed the tolerable amount in error of
$2.0 million.

Appendix I Scope and Methodology

We did not conduct detailed tests of transactions for COG. An independent
public accounting firm audits the financial statements of COG annually and
the federal funds provided to COG were included in its fiscal year 2004
audit. COG received an unqualified, "clean," opinion for fiscal years
ended June 30, 2004, and June 30, 2003. COG's fiscal year 2004 foster care
improvements funds were recorded in the supplementary information to its
fiscal year 2004 financial statements, specifically its Project Statement
of Revenues, Expenditures, and Changes in Net Assets-and audited as part
of the financial audit. Furthermore, the independent auditor did not
identify any internal control weaknesses over financial reporting and
operations or any instances of noncompliance for purposes of the reports
on internal controls and compliance that are required by Government
Auditing Standards.2 We did conduct walk-throughs of COG's accounting,
payroll, procurement, and payment processes. In addition, we obtained and
analyzed the COG spending plans, and budget and financial documents
related to their portion of the federal funds.

To assess the extent to which CFSA, DMH, and COG have implemented the
foster care improvement programs and initiatives specified in the
appropriations act and spending plans, we gathered and analyzed data from
various sources. We interviewed agency officials from CFSA, DMH, COG, and
Foster and Adoptive Parents Advocacy Center (FAPAC) that were responsible
for each of the programs and initiatives. Several of these officials also
responded via e-mail to several questions regarding the program. In
addition, officials from CFSA, DMH, and FAPAC prepared written statements
for congressional hearings that addressed these programs, and we obtained
and analyzed these statements. We reviewed program policies, protocols,
and plans as well as the legislation and the spending plans. Generally,
the legislation or the plans identified CFSA's goals and desired outcomes
for the programs. Data on the number of participants in the student loan
repayment program was as of September 2004, which was the deadline for the
program. We obtained program information on the status of the other
programs as of April 2005 or June 2005. This information included budget
documents, expenditure reports, and data on services provided to children
and families. We compared this information to the programs' plans and
goals in order to assess the extent to which the programs and initiatives
were implemented, achieved established goals, or led to other outcomes.

2GAO-03-673G.

Appendix I Scope and Methodology

We took several steps to assess the reliability and reasonableness of
program data and found the program data to be reasonable and sufficiently
reliable for the purposes of providing information on the status of the
programs and initiatives supported by the federal foster care improvement
funds provided in fiscal year 2004. To assess the data on the services
provided by the early intervention program and emergency support fund, we
interviewed officials responsible for compiling the data and compared it
to relevant financial transaction records. We did not contact individual
families to determine whether they received the services or products, but
we asked officials from FAPAC about the foster and adoptive parents' views
about the programs in general and the services provided. To evaluate the
student loan repayment data, we interviewed program officials and compared
the data to the numbers previously reported by CFSA and determined that
the various subcategories-such as the number of participants by loan
repayment amounts and by years of service-equaled the total. We also
compared the totals to the financial obligations but could not compare the
data to individual payments because CFSA had not made any payments to
caseworkers as of the date of our review. To corroborate the data on
mental health services provided to foster care children reported by DMH,
we interviewed the officials from the department who were responsible for
compiling the data. In addition, we checked the reported data against
information provided in DMH testimony before the Senate Committee on
Appropriations, reports submitted to the U.S. District Court for the
District of Columbia by the monitor of the District's mental health
system, DMH grant agreements, and data provided by CFSA. Finally, we
interviewed Family Court officials to corroborate assessment time frames
reported by DMH. Data on the respite program were generally provided by
COG and corroborated by officials from FAPAC. Upon completion of these
steps, we determined that the above-mentioned data were sufficiently
reliable for the purposes of this report.

We conducted our work from October 2004 to June 2005 in accordance with
U.S. generally accepted government auditing standards.

Appendix II

Comments from the District's Child and Family Services Agency

Appendix II
Comments from the District's Child and
Family Services Agency

Appendix II
Comments from the District's Child and
Family Services Agency

Appendix II
Comments from the District's Child and
Family Services Agency

Appendix III

Comments from the District's Department of Mental Health

Appendix III Comments from the District's Department of Mental Health
Appendix III Comments from the District's Department of Mental Health

Appendix IV

Comments from the Metropolitan Washington Council of Governments

Appendix V

                     GAO Contacts and Staff Acknowledgments

GAO Contacts	Jeanette Franzel at (202) 512- 9471 or [email protected]
Cornelia M. Ashby at (202) 512-8403 or [email protected]

Staff 	The following individuals also made important contributions to this
report: Norma Samuel, Carolyn Taylor, Carolyn Yocom, Susan Barnidge,
Sharon

Acknowledgments	Byrd, Jacquelyn Hamilton, Maxine Hattery, Deborah Peay,
Vernette Shaw, and Sandra Silzer.

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