A drawn-out legal battle over how much families are paid to care for foster children is headed to court, where attorneys say the dispute could end up costing the state significantly more than a multimillion-dollar settlement that was rejected last year by the Legislature.
U.S. District Judge Leslie Kobayashi last March approved a tentative deal to settle a 2013 class-action lawsuit filed against the state Department of Human Services, which oversees foster care. The lawsuit accused the state of violating requirements of the federal Child Welfare Act that foster-care payments be sufficient to cover the cost of providing for a child’s basic necessities and that the rates be reviewed periodically.
The so-called foster board rate in Hawaii remained unchanged at $529 per month for more than two decades until 2014, after the suit was filed. The rates were boosted at that time to a range of $576 to $676 a month depending on a child’s age.
The increase worked out to about $22 per day at the high end of the range from about $17 per day under the old rate. The legal challenge continued because advocates believed the amounts still fell short of what’s required under the law.
The law says the payments need to be sufficient to cover the cost of providing such necessities as food, clothing, shelter, daily supervision and school supplies to care for abused and neglected children who have been removed from the custody of their parents. There are roughly 2,800 children in foster care in Hawaii.
The parties reached a tentative settlement last year that would have raised the monthly rates to $649 per child for younger children and $776 for children 12 years and older. The deal also called for the state to regularly review the rates to assure they are adequate.
The negotiated deal — which had consent from the Department of Human Services, Gov. David Ige and the Attorney General’s Office — was subject to funding from the Legislature.
To fund the higher foster payments, the Department of Human Services last year sought $7.13 million for each of the next two years as part of its budget request to the Legislature. A separate $3.4 million appropriation was requested as part of funding legislation to settle various claims against the state — $2.3 million in back pay to several thousand foster parents and $1.1 million in attorneys fees for the plaintiffs.
The settlement requests advanced through the 2017 legislative session with support from Senate leaders, but the House Finance Committee nixed the deal. Finance Chairwoman Sylvia Luke (D, Punchbowl-Pauoa-Nuuanu) told the Honolulu Star-Advertiser at the time that she objected to paying for the plaintiffs’ attorney fees as well as to the courts mandating state programs.
The deal expired in June and the case has been scheduled for trial in March.
Request for funding
While attorneys representing the foster parents say they’re prepared to litigate the case, the Ige administration is again requesting $7.13 million for next fiscal year called for in the expired settlement to raise the monthly payments.
A spokeswoman for the governor said the funding request is not tied to any proposed settlement of the lawsuit, even though the request is labeled in the governor’s budget request as “Foster Care Board rate settlement increases.”
“The increase requested by the Department of Human Services in the governor’s budget is based upon DHS’s own responsibility to determine an appropriate foster board rate in accordance with the applicable federal and state regulations,” Cindy McMillan, communications director for Ige, said in an email.
Keopu Reelitz, spokeswoman for the Department of Human Services, said the department “mistakenly included a reference to the settlement” in its budget request. She added that the department conducted a review as required by federal and state laws “and determined that the proposed foster board rate increase is required for DHS to meet the needs of our resource caregivers (formerly foster parents) and our foster youth.”
‘Ready to litigate’
Attorney Victor Geminiani, co-executive director for the Hawaii Appleseed Center for Law and Economic Justice, said that raising the rates outside of a legal settlement will not make the lawsuit go away.
Geminiani, whose firm served as co-counsel with Alston Hunt Floyd & Ing on the case, contends the higher rates proposed in the old settlement are still insufficient. If the rate had kept pace with inflation, the lawsuit says, it would have nearly doubled to $950 per month between 1990 and 2014.
“They’re adjusting the rates because they have two problems: No. 1, they’re totally out of compliance with the law and have been,” Geminiani said, “and No. 2, they’re having a hard time attracting and retaining foster parents. Raising the rates now is not going to change the lawsuit. It’s going to continue.”
He rejects the administration’s explanation that the funding increase stems from a periodic review of the rates.
“Oh, come on. Since 1990 they did nothing and all of a sudden because a lawsuit is brought, now it’s, ‘We’re going to comply with all of the requirements we have under the law’? It’s a joke,” he said. “And the judge will see that.”
Still, he said he’s hopeful the case can be settled.
“But we have not gotten any indication that the House Finance (chairwoman) is interested in revisiting the issue again this legislative session,” Geminiani said. “We’re ready to litigate.”
Luke did not respond to requests for comment.
Geminiani said he believes Luke is trying to send a message that the state can’t be sued.
“As a lawyer, she should understand the issue of the state being out of compliance with the law. … They’d like to stall because they’d like to make it less attractive for anybody to ultimately sue the state.”
