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Subcommittee delays bill that would conserve federal benefits for youth in state care
Summary
The Children and Family Affairs Subcommittee advanced House Bill 1235 as amended to the special calendar after lawmakers and Department of Children’s Services officials discussed fiscal impacts and how conserved federal benefits could affect eligibility for programs such as SSI and Medicaid.
House Bill 1235, sponsored by Representative Love, directs the Department of Children's Services (DCS) to conserve certain federal benefits owed to children in state custody—placing those funds in a trust, 529 plan, special-needs trust or bank account rather than allowing the state to absorb them for current care. Representative Love said the goal is to ensure children who would otherwise lose access to those funds have them available when they need them.
Jim Layman, legislative director for DCS, told the committee the fiscal note estimates the state currently collects “around $7,000,000” in these federal entitlements and that the department supports conserving funds in concept so long as lost revenue is replaced. Layman warned that holding funds on behalf of a child could count as income and “could, could, affect their eligibility” for other federal benefits. Hayes O'Donnell, DCS assistant legislative director, emphasized the practical limit for many federal programs—“Oftentimes that is $2,000 for most accounts for Social Security or they could run the risk of losing those benefits.”
Members pressed the department on logistics and on what would happen when youth age into extended foster care. Representative Towns advocated reclassifying the funds as a “stipend” and urged state legal and federal advocacy: “That's cruel. That's very cruel,” Towns said, describing the prospect of young people losing access to supports. Committee counsel confirmed rolling the bill to the special calendar would provide more time to draft amendments. Representative Harris moved to roll HB1235 to the special calendar; the motion carried and the bill was placed on the special calendar "as amended" for further work with DCS and the sponsor.
