ACYF Administration on Children, Youth and Families	U.S. DEPARTMENT OF HEALTH AND HUMAN SERVICES Administration for Children and Families
	1. Log No. ACYF-IM-HS-95-12	2. Issuance Date: 03/10/95
	3. Originating Office: Head Start Bureau
	4. Key Word: Administrative Costs, Child Placement Services, Training

INFORMATION MEMORANDUM

TO: State Agencies Administering or Supervising the Administration of Titles IV-B and IV-E of the Social Security Act.

SUBJECT: Possible limitation on amount of allowable child placement services, administrative expenditures and training costs reimbursable under title IV-E in and for Federal Fiscal Year (FY) 1995

LEGAL AND RELATED REFERENCES: Section 474 of the Social Security Act.

CONTENT: On March 3, 1995, the Appropriations Committee of the U.S. House of Representatives reported out HR 1158, a bill which would rescind over $20 billion in spending authority for FY' 1995. One provision of this legislation, if enacted, would limit the amount of title IV-E child placement services, administrative expenditures and training costs for which Federal reimbursement could be provided. As of this date, the legislation has not been passed by either house of Congress.

The following is the language adopted by the Committee:

Of the funds made available under this heading in P.L. 103-333 for payments to States under section 474(a)(3) of the Social Security Act, an amount is hereby rescinded such that the total made available to any State under such section in fiscal year 1995 does not exceed 110 percent of the total paid to such State thereunder in fiscal year 1994 which, notwithstanding any other provision of law, is the maximum amount to which any such State shall be entitled for payments under such section 474(a)(3) for fiscal year 1995.

Our understanding of this language is that it would limit the maximum amount that could be paid to any State in FY 1995 for title IV-E child placement services, administrative expenditures and training costs to 110 percent of the total amount paid to that State for IV-E administrative costs in FY 1994.

In addition, the total amount of administrative costs reimbursable to any State for FY 1995 incurred expenditures would also be limited to 110 percent of total administrative costs paid to the State in FY 1994, even though some of the costs for FY 1995 could be claimed in FY 1996 and FY 1997.

The attached table shows for each State the maximum reimbursement amount which could be allowed under this provision for title IV-E administrative costs claimed in FY 1995, based on the latest information available and the capped level that would be imposed by the proposed legislation. The same limitation would also apply to the amount of reimbursement available to States for costs applicable for FY 1995, but climbable in subsequent years.

The proposed language would limit total reimbursable administrative costs which include training under title IV-E and enhanced funding (at 75 percent Federal matching) for Statewide Automated Child Welfare Information Systems (SACWIS).

NOTE: This is a preliminary analysis of proposed legislation which has not yet been enacted and which may be amended substantially during subsequent Congressional action. This material is being provided solely for informational purposes.

ACTION REQUIRED: None at this time.

INQUIRIES:

Norman L. Thompson
Director
Office of Financial Management
(202) 401-9238

/S/
Olivia A. Golden
Commissioner

House-Proposed FY 95 Limit