New York State Department of Social Services, DAB No. 1522 (1995)

Department of Health and Human Services

DEPARTMENTAL APPEALS BOARD

Appellate Division

SUBJECT: New York State Department of Social Services

DATE: July 18, 1995
Docket No. A-95-140
Decision No. 1522

DECISION

The New York State Department of Social Services (New
York) appealed a determination by the Administration for
Children and Families (ACF) disallowing $47,249,160.00 in
claims for federal funds under title IV-E of the Social
Security Act. 1/ Title IV-E provides funding for foster
care maintenance payments on behalf of children who would
otherwise be eligible for title IV-A (Aid to Families
with Dependent Children). This case involves claims for
the administrative costs incurred for protective services
provided to children for whom there was reasonable cause
to suspect abuse or maltreatment.

New York claimed these administrative costs pursuant to
the "Title IV-E as the Primary Program Option" (IV-E
Option) of its "Services" Cost Allocation Plan (CAP)
amendment which it filed in March 1992. In this
amendment, New York proposed two options for allocating
Social Service District administrative costs for
protective services: the IV-E Option which followed the
allocation methodology previously rejected by this
Department's Division of Cost Allocation (DCA) and by the
Board in New York State Dept. of Social Services, DAB No.
1428 (1993), and the "Title IV-A Emergency Assistance to
Needy Families with Dependent Children (EAF) Option" (EAF
Option) which was developed by New York in conformance
with ACF-PA-87-05 (1987) and DAB No. 1428. On December
29, 1994, DCA approved the EAF Option, subject to certain
conditions, and disapproved the IV-E Option. New York
filed these costs pursuant to the IV-E Option to preserve
its appeal rights regarding DAB No. 1428 and the
subsequently incurred protective services costs. ACF
reimbursed New York for the claims pursuant to the EAF
Option.

The activities for which New York sought reimbursement
pursuant to this amendment were divided into ten
categories of activities typically performed by Child
Protective Services workers. 2/ New York claimed these
costs for all children who were the subject of a State
Central Registry (SCR) abuse or maltreatment report and
who had not been determined to be ineligible for title
IV-E.

Prior to New York's claiming these funds, DCA had
partially approved and partially denied a prior CAP
amendment which set forth the cost allocation methodology
which New York resubmitted to DCA in its IV-E Option of
its "Services" CAP amendment. DCA's ruling on that prior
amendment and ACF's disallowances of claims pursuant to
that prior amendment were considered by the Board in DAB
No. 1428. The Board has also issued summary decisions
based on DAB No. 1428, affirming additional disallowances
of title IV-E reimbursement for protective services. New
York State Dept. of Social Services, DAB Nos. 1442
(1993), 1470 (1994), 1503 (1994), and 1513 (1995). As to
this disallowance, New York requested another summary
decision upholding this disallowance based on DAB No.
1428. Notice of Appeal dated June 7, 1995. ACF did not
object to the issuance of a summary decision.

In DAB No. 1428, the Board upheld DCA's determination
that four of the protective services activities described
by the prior CAP amendment were not allowable title IV-E
activities. The Board concluded that these four
activities were not identified in the regulations as
allowable administrative activities and were not
activities which were unique to title IV-E or which
furthered its specific, limited purposes. DCA found that
the remaining six activities were allocable to title IV-E
if performed on behalf of candidates for title IV-E. As
to these six activities, the Board upheld ACF's
determination that New York's characterization of all
children who were the subject of an SCR report as title
IV-E candidates was not consistent with title IV-E, the
regulations and ACF's policy announcement, ACYF-PA-87-05.

Because ACF was willing to reduce the disallowances in
DAB No. 1428 by the amount of costs that New York could
document in a manner consistent with DCA's decision and
the requirements of applicable authorities including
ACYF-PA-87-05, the Board remanded those disallowances to
ACF to make that reduction. In the subsequent summary
decisions, the Board also remanded the disallowances to
ACF so that it could reduce the disallowances. In this
case, New York represented that there was no need for
such a remand because ACF had paid the portion of title
IV-E claims determined allowable under the EAF Option of
New York's "Services" CAP amendment.

Conclusion

Accordingly, based on the analysis in DAB No. 1428 which
we incorporate in its entirety here, we uphold ACF's
disallowance of these costs.

___________________________
Judith A. Ballard

___________________________
Norval D. (John) Settle

___________________________
Donald F. Garrett
Presiding Board Member


1. New York appealed from ACF's letter of May 8, 1995
disallowing $59,203,204.00 in title IV-E funds. The
disallowance was composed of several categories of title
IV-E costs: foster care maintenance payments made to New
York City (NYC) kinship foster homes; administrative
costs for preventive and protective services;
administrative cost claims adjustments pursuant to New
York's recently approved "Services" Cost Allocation Plan
amendment; and administrative costs incurred in the
development of NYC's services payment plan system. This
decision concerns only one portion of the May 8, 1995
disallowance: administrative costs for protective
services provided by local Social Services Districts in
the amount of $47,249,160.00. The portions of the
disallowance concerning maintenance payments, preventive
services costs, claims adjustments, and the development
of NYC's services payment plan system have been assigned
different DAB docket numbers and will be considered
separately.

2. These activities were processing State Central
Registry forms; determining the nature, extent, and cause
of injuries; risk assessment; arranging for other
services; arranging for foster care; supervisory
consultation/conference; family court proceedings;
preparing and maintaining Welfare Management System/Child
Care Review Service documentation; preparing and
maintaining case record documentation; and case
management/monitoring services.