October 9, 2026 · Appropriations · 11,180 words · 2 speakers · 24 segments
Over there? Who? Who did that? I don't want that to happen. Josh. Okay. Blaine. Good morning everyone. It's 9 a.m. And we'll start the hearing for lr for 52 this morning. And welcome to the appropriations Committee.
My name is christy armendariz. I represent legislative district 18. I am the vice chair of the Committee. I will start off by having members do self-introductions starting with my far right. Thank you very much. Good morning everyone. Jason prokop state Senator, legislative district which is west ncoln, laner von. Lippincott district 34. Paul distr 47, which is the panhandle. Thank you. And assisting with the Committee today is corey bierbaum, our Committee clerk. If you are testifying today, please fill out a green testify sheet located in the entrances of the room and hand it to the clerk. When you come up to testify. To better facilitate today's hearings, I ask that you abide by thefollowp lence your cell phones. Wn you come to testify, spell your first and last name for the record before you testify. Be concise. We request that you limit your testimony to five minutes or less. Written material may be distributed to the Committee members as exhibits only while testimony is being offered. Please be sure to have your 12 copies. Hand them to the clerk for distribution when you come up to testify. We do not accept oversize exhibits, exhibits, cds, thumb drives, or other electronic exhibits. Today we have an lr, so it's a little bit different. We have invited testimony only. We do not have proponents or opponents. The list of testifiers just so you guys can plan when you're coming up, or for those at home to plan who's coming in what order. Gene potter, the Nebraska state probation officer, will be right after Senator spivey's introduction. Then monica gross, Nebraska's foster careiew office. Durr, Nebraska appleseed and john meals, department of health and human services. And then we will conclude with Senator spivey's conclusion, or if there are any questions that she'd like to follow up on. And with that, we would end the hearing. So with that, we'llbeg. Senator biden. Thank you, vice chair armendariz and esteemed members of the appropriations Committee. I am ashley spivey, a shleisp as in paul, I v as in victor e, representing the best district. District 13 in northeast and northwest omaha. Yes, I did say that, Senator strommen. Som situ all today to bring. LR 52 ich I think fe is a compilation of conversatio that we've had toget ove the last two y.now that we are in tight fiscal times, and we sit and wrestle together as appropriations Committee around ers anesources that have outsized impact for and one of the things that has been hard for me to really grapple with or get my arms around is some of our most complex youth that are navigating v tough umstans. We know that we have young people, both in the child welfa system and thjuvenie needing more complex and intensive care. We are appropriating those services, ye's unclear around how we still are arriving to the same outcomes that we are.
I think, in my opinion, have a strong opportunity to better serve them through stronger resources. The effectiveness of those resources and the collaboration of agencies. And so usually this conversation is either held solely in judiciary solely inhs Committee. Committee members talk. And I was like, well, you know what? If we started with the money, what if we started with understanding how we are appropriating in the structure of these dollars, which really guide the resources and see how that ripples into the actual services and the effectiveness of these agencies to better support these young people. And so that is why this is in appropriations. I really wanted to get a better handle on the structure of the dollars, how we are leveraging federal funding. And then what does that look like as we are supporting our young people? And so that is the purpose of this lr today. T we will hea fr probation as they talk about their structure, what their dollars look like, how they've been looking at these youth that are in both systems. We have monica here that will from office of foster care review that is really monitoring the outputs and outcomes of these young people, which I think is important for us to ground in.an make sure that as we are appropriating money and as this conversation will continue to come up in the next biennium, us having a better understanding of where these young people are and how we can best organe resources, I think is going to be really eed that specifically going to talk about for funding. And so when we talk about federal funding and how we can leverage more federal dollars, which ourxe bnchs a proponent of, how can we do that? What does that look like and how do we continue down that path? And then lastly, from hhs, the other responsible agen that is managing the support and success of those ung people.nd so, again, I'm excited for this reframe of the to start with appropriations Committee, and I would be happy to answer any questions or thoughts that you have before get sta with the testifiers. Thank you so much. And for those listening and not watching, we have Senator dorn dorn joining us and Senator michaela cavanaugh joining us Committee? I have one question. So I've you've briefed me just slightly on this. Do you have. And I'm really about creating efficiencies and let's better focus the dollars and no overlap. Do you have a preference of where in your research of where we might augment some dollars in one side over the other or. Yeah. So I've had initial conversations with both hhs and probation around what their funding looks like and where there is some overlap.
I think the first opportunity is how we continue to leverage for funding, and that there are opportunities around that efficiency to draw down more federa dollars that would really support on the child welfare side, which is hhs, which then would help to augment on the juvenile justice side. A then both agencies, we've had conversns. Wealread ag set up after this to talk about policy, which I think is really important in shows, the collaboration that these agency directors want to have. We know that out of this hearing, there will be some changes in legislation around how we can better support the funding, and they have already committed to having those conversations. We have time protected, and so I don't want to get ahead of that meeting to say like, this is my thoughts, but just that all of the parties are very interested in finding efficiencies while ensuring which to me is most people can be successfulung because we don't want to get to a place where we have to make cuts to services and programs, which then doesn't allow for these folks, these kids, to come backnto community and be successful because we know t juveniles have has the biggest opportunity for rehabilitation. And so we've already started some of those. There will be some information that comes out, but I want to make sure that I honor the space of the agencies having that conversation with me. Any other questions come up from the Committee? I just wanted to follow up with the for funding. If we draw more of that down, is there a mandatory match from the state? It depends on some of the formula and how it's used. And so. And in your packets, what's and I'm like, I'm still trying to wrap my mind around it. And so in the packets that weprepars a language bank because there's a lot of acronyms, as we know, in all agencies, so we can make sure we're speaking the same language, but we have an overview of for funding and appleseed prepared information aroundre us to ntinue to oside d welfare there, with 40 funding and fedal funding in general, we could draw down more as Nebraska. So not just in this specific area, but in general, we can draw down more federal funding, which would help in certain areas and agencies too. And so I do think there is a larger conversation that appropriations will have around how we're looking at federal funding, what' available to us, how do we draw th down, and then how do we leverage that in specific agencies where we know that we have to have a match or not? And I appreciate that. Senator. I believe that for. Funding. An increase in foreign funding would be a decrease in services.
Soust thrt yes hav e that we c have the strongest understanding of funding, because again, I have a crash course, but I want to make sure that we have folks that are working on the front lines on this every day able to help us er underst sokns in front of uss we start to continue to have hard conversations about our, our fiscal landscape. Okay. Thank you. There's no more questions. We'll thank you, Senator spivey. Thank you. We'll have our first testifier, jean cotter, from the Nebraska state probation office. Welcome, jean. Thank you very much. Good friday morning, vice chair armendariz, members of the appropriations Committee. My name is jean cotter, genecotter, and I am Nebraska state probation administrator. I'd like to begin by thanking Senator spiy for bringing this forward, because this is very important conversation. In 2013, the Legislature passed LB 561, launching significant juvenile justice reform. Then, in 2016 created the juvenile probation services budget. The administrative office of the courts and probation has continuously, with a singular exception, remained within its general fund budget allocation despite experiencing additional financial impact without requesting addnal general fu for exa, in fy th Legislature implemented a 15% provider rate increase, neweneralds and wated with no thrrent general fund budget until fiscal year 25, when the Legislature gave us a o tallo.dd a staff salary study and rate increa from within our current budget. In 2016 and 2025, the auditor of public accounts condued audits on probation funding, and both of those reports, the auditor highlighted probation was funding services that should have been leveraged, leveraging federal funding available through the department o health and humanouth being servy both juvenile probation and within the child welfare system. In fy 26, probation paid approximately $5.9 million for services that were received by meaning thatos youth that are t ordered to probation but also in the care, custody and control of dhhs. There are no specific appropriations or budget allocations targeting specifically crossover youth. The auditor also highlighted a need for more collaboration between dhhs and probation in accessing of other available federal funds, particularly title 40 claiming dollars. Despite historical collaborative difficulties over the last several months, probation has worked closely with andther statend identifying ways to draw down these identified available federa funds. Nebraska revised statutes 43,90 and 290.01. Establish quote, the cost of care and treatment and payment procedes for youth and families involved in the courts, en quote. What appears clear on the surface is less than so in application, especially when multiple cases are in play. Two 90s purpose is to, quote, promote parental responsibility and to provide for the most equitable use and availability of public money, end quote. There are questions regarding whether a court can actually require e custodian to expend personal resourc including insurance benefits, if the custodian refuses to do so. Ashm times, eecialing with finances, custodians are less than forthcoming with available financial income and resources.
290.01 establishes a payment structure for venile servicefor counties, obation and in section one a the county is respole r paying for things such as detention s dication in section o, probation becomes responsiblefrm their term of probation,nd in one c, th officof juvenile services is responsible. When the juvenile is committed to oj s. In response t section thr of this, lrbation esishes reimbursement rates through those established by medicaid, developmental disabilities and those app across behaviora regii would be remiss if I did ert this Committee to what I believe is an increasing concern when it comes to accessibility of services for youth on probation. Over the last year, one in every four youth on probation has been in. And out-of-home placement and over the pastear, as many as 65% of all kids that are in ychiatric residential treatment facilities are in states other than Nebraska. We continue to also lose accessible beds across the country. This becomes more troublesome when judges are reluctant to place youth in the. This means more youth are fighting for already limited resources within the community. So with that, I appreciate your time and I am willing t answer any questions you might hav thank you. Any questions from the Committee? Senator cavaugh? Thank you. T you for being here. To your last point, I thought perhaps could clarify for the Committee. That's not maybe as familiar. So the y. Rtc is the youth rehabilitation treatment centers are state run facilities. And then we have facilities like boys town. And the difference between tis that our facilities are no eject, no reject, but boys town, they can decide who comes through the doors. The y rtc is a no eject, no reject. However, we also have like white hall, which is a state run yrprtf. That is not a no eject, no reject. But to your point, yes, that is accurate. So boys town can make determinations. Whitehall, emanuel, etc. Can all make determinations as to whether you get to come, whether you get to stay based on your o when our courts are hesitant to place youth in the care and custody of the state run facilities, as you meioned, recent incidences, sply at kearney, we run out of optionsf where to put these youth. That is accate. We wfind ourselves regularly, whether in that situation or not, looking for beds wherever we can find them. Sometimes we end up having tesort towhat perhs recommended in evaluations more times than not. However, w have to go to a lowerel of prtf level, it somemes takes us months to get somebody into the level of recoended care. Sometimes they sit in a very expensive detention behile we' waiting for those things. At other times, for example, they will go to a lesser a lesser level of care to meet those diagnose at at is higherve been try t exhaust all in-stateo is options.
You know, that's a little bit what I mean by that is, if I'm in Senator stroman's district, it may be closer for me to send somebody to, to, to cheyenne or to laramie, because it's a lot closer than sending them across the state to, to omaha. But we try to we tryo exhaust Nebraska resources before we send people out of state. At a given time,e could have kids in nine other states, however. And the 65% I. I guess I der the impressionhat actually had been decreasing in recent years how many out-of-state placements we have. So is this a new increase or is this. That that figure ptains particularly specifically to prtf? So weeeen ae to reduce our overall out-of-state placement. But prtf placement is because we do not have the available space in prprs in Nebraska. We just within the last year had to develop a new prtf placement in the state of pennsylvania, for example, because of the lack of available resources at that level of care in Nebraska. Thank you. Thank you. Senator strowman. How how many. Kids are. Placed out of state? What's the total number? Well let's see. You know what, Senator strowman? I don't have that exact number off the top of my head. I know that about 500. We have about 2000 time, and 500 of them are out you the exact number of kidst that are out of stat okaeah, d because 65% increase. Is that right?ved just be interes to knowhatt that tnumb is. Yeah. I can tell you that from a mathematical perspective, and I'm a criminal justice person for a reason. The math has never been my strong suit, but we went from 67%. We had to. Another thing that made the news recently was the closure of provo canyo in provo. So we hado remove 13 nebraskaids from bot girls programs in provo to bring them back to Nebraska, and tha from o out 44%. So I can get you specific numbers on that, but that gives you a little bit of a a picture of that. Okay. Okay. Follow up. But and I gss to go along with that, what would the cost associated with that be? Well, souracket there is a cost of what like a prt per day is. So when we send kids to other states, one of the things that just on its surface, we're paying the same rate, the same medicaid rate in utah or arkansas or pennsylvania as we would be paying if they were in Nebraska. A lot of times those placement options out of state agree to pay for the transportation of the youth out there. But that is that does not account for gs like.
We have historically tried to send probation officers to those facilities to check on the Nebraska kids, to make sure that they know that the Nebraska, that we haven't forgotten about them, to work with them to reentry plan forthf budget situations, we've had to draw that back a little bit. We're now sending them quarterly meeting with tm by way of zoom. Those types of things in the intervening months. But the part that that does not account for I that that a lot of times eliminates families from being able to travel to participate in the treatment, to see their see and support their youth, those types of things. So to be able to just put a dollar on it from, from a funding stream, if you take out the work that probation is doing to go meet with them. Et cetera. You're not going you're going tsee negligible differences between what the actual cost of the kid in tre I b it's all these ancillary expenditures that come after that, some of them that are actually not money based, that that is where the real impact is. Okay. So would I have to pay a fee or anything to correct. Correct. Okay. Okay. Senator. T you. Thank you. And thank you for being here. And you ki of one of the questions I had was, I thought we had a home, that we were out of state putting some student or children in and through tabout that at utah, that we had to bring those back versus you. The funding part of this through hear your conversation. We haven't increased your budget at all, but yet. Costs have probably gone up. So are we getting more federal funds? Because these are kind of all set, I call it. And you talked about various states that the rates for that child here or in texas is the it's st getting them there and other things. So what what is what is increased? Your budget, which I don'tunch n think you probably had somewhere that money had to come from. So what could you talk about that a little bit? So when you talk about federal funds, federal funds is not something we have access to. We have to go through the department of health and human services, those like title 40, other expenditures. So when you look at things like the aur's report a we she leveraging, or if youok at t criteria is set up, that is why we have historically tried to work vy close dhs, because they have the federal occasionally will seek a grant or something like that. But as we know, when we go seek grant funding, a lot of times the grant helps set things up, but then we become responsible for carrying, carrying the cost of those programs forward. So one of the things that we continue to do isodify ournternal practices.
If you look at, for example, this was something that auditor's report, but we try to make sure ample oversight over our our voucher expenditures othe general fund allocat thateave. We leverage other, other available funds as can. You budget is, I think0 a about 50 of that is dedicated to, to juvenile services. But things that we have continued e to do is we have single case agreements, example. So one of the things that you'll see is if a kid has a pref, a youth has a pref recommendation, and we can't find them a place in Nebraska or elsewhere readily without them lingering in a detention bed, for example, we will enter into single case agreements where a provider will come and say, well, that's not exactly this. But, you know, for example, we have a placement in the state that will say, we will take that very high risk kid that presents some pretty unique programs, but we're going to need to assign two staff at all times to that kid. And so that's the way we kind of navigate some of those things. We have also, we regularly,e regularly participate in rate set groups with like,er it be, whether it be through dhs, d, b h, you name it. We have also speaking of detention, we commissioned a detention rate study through the university of Nebraska department of economics a year ago, and it came back saying, currently the reimbursement rate, which we do not set but we pay, was about $104 belowha actually costing detention centers. And have wnd varieut butre's fourdey the settled on rate determined by the department of economics and I might have the department wrong, but it was we commissioned it through unl says it's about $104 per day, lower than what it should be. So that'd be a difference between 100 and $62,000 a year in detention versus $124,000 a year. We are always exploring new ways for funding, but from a federal drawdown perspective, that is not something we have available us. That that is all facilitated through dhhs. Okay, thank you for thatanati misunderstood something. You don't set no rates. You just pay the rates, you yourself or whatever. Dhh so who who ultimately sets that ratep up here? Say $260 for this kid at that tomorrow at x, y, z. So, Senator dorn, could we set rates? Yeah, we could, but what we have found is what we don't want to do, especially with these dwindling resources, is set up a competitive system whereby I'm going to take this kid over to this other, this other state youth who needs this service because probation is going to pay us this much more and this and this. So we're going to take that kid. So we try to follow developmental disability sets their rates. So if we have a kid in a dd placement, we tend to follow that rate.
If dhs establishes a rate, we follow that if medicaid sets a rate, we follow that rate. So could we. Yes. As a matter of fact, a couple of years ago we had an opportunity to go 2% above what medicaid reimbursement was. Bbe, because whatever, we have actually had to retract that. And m bet would be if you talk to navajo, if you talk to othery ertainly beuch more o answeringe they really being reimbursed at the rate that they should bas oppose to what they're making than what I am? I don't know if you know this or not,ut many oyou are the pple that pick up your caseloads or whatever, or pick up your placements. What percent of their business is, I call it a state placement. Is it 10% or is it 100% or any idea at all? Or maybe somebody later can answer thatuestion. I mean, because, you know, like nursing homes, if you're on, if you're 75% medicaid, you're probably medicare, excuse me, you're not probably going to be financially well off. So any idea. I can go? I can in no way could I go across all of the different placement options we have and give you that number right now sitting here, I can certainly get it to you. I do happen to know we just took a tour of a of a placement organization in Nebraska within the last couple of months. And they mentioned that they have 80 prtf beds and ten of them are dedicated are our probation beds. So in that one situation, there are many of a very s percentage are dediced to our youth. But they're they'rels call it out there doing more business than justrom us from. Okay, 100%. I mean, they're, they're working. One of the things that was a little startling during that presentation was that they have more five year olds in their programs than they do you like 17 year olds. And so when you come, when it comes to making decisions around, am I taking these high risk with with potentially violent tendencies or more developed behavioral. Issues, mixing those populations becom a little bit difficult, too. So there's a lot of considerations welnk y for coming and giving some explanation on that. And where Senator spivey, you're trying to, said you're trying to wrap your thoughts around this. I've been here eight years and I'm still trying to do that too. So don't feel bad at all. Whatever the people that understand this are involved with it. I really appreciate it. Thank you. You bet you. Sorry, cavanaugh. Thank you. The question that Senator strommen had about seeing the kids that aut of e placement, you said that yo probation officers do quarterly visits. We do monthly visits. However, it used to be that we were in every one of those facilities every month, meeting with every one of those kids. We still meet with them every month.
However, we're meeting with them in person in january, then remotely in february and march, and we're back in the facility again in april. Those types of things. That's something that's brand new within the last several months, prompted by by budget considerations. And as a result of that, we may be in tandem with it. How does that how do those placements interact with like, does the inspector general of child welfare ao ha oversight? Do they get complaints? My question mostly beini don't want happening to our kids that we send out of kids here kearney?ned to o big answer here is if I go to the provo situation, for example, they were not forthcoming with information with us about active investigations,hings, reports, I don't know this for certain. I would I don't know that jennifer carter or her office would have thelity to investigate the place in utah. We actually were inh physically meeting with every single one of those kids before the story broke. And we're asking questions of the kids and the facility and all those things. Again, we were not getting worthwhile answers. So we have now we in the process of changing our procedures for these out-of-state pcements tontsk those questions regularly. Are you under invtition? Is ur license, is ther anying in jeopardy, etc. So that we can continue to t those things that way? Another one of the unintended consequences of having our kids out of state, we have the Nebraska facilities that we're in all the time. We're in them weekly. Sometimes we might be in them daily. So we're inctinith oids within those state, those sta run p rularly. I would even, I don't know thish 100% certainty, but if I'm laramie, wyoming, or cheyenne, you know, it's a 75, it's an really close with more to be in in pennsylvania and kaas and utah and arizona. Nk you you bet. Any other questions from the Committee? Thank you for your testimony. Thank you. Senator armendariz. There is some answers to the questions youe asking earlier in the information you submitted. Testifier will be monica gross from the Nebraska foster care review office. Welcome. Thank you. Good morning, Senator armendariz and members of the appropriations Committee. My name is monica gross, monikagros and I'mhe executive directorfoster careevy responsible for overseeing the foster care system by tracking, reviewing and reporting on cases of children in out-of-home care in nebra oversight takes place on two levels the individual case level and the systemic level. Individual case files are reviewed with the needs of each child in mind. If the system doesn't meet those needs, the f c, r o advocates for the best interest of the individual child. Simultaneously, data is llected from every case review, and it's used to create a system wide view of trends, successes, and challenges in child welfare.
And I would add juvenile justice in fiscal year 2526, the fcro tracked information regarding the experiences of 6787 children who were removed from their homes and placed in state custody, care or supervision through the child welfare or juvenile probation systems. Our independent data system, known as the foster care tracking system, tracks every episode in carelacement change and rker change.t also tras relevant court information for analyze large scale system changes. Cases are reviewed by local citizen review boards. All volunteers that meet monthly in fiscal year 2526 325 local review board members serving on 54 local review boards conducted 4147 reviews of cases involving 3180 dhhs wards in out-of-home care, and 243 reviews of 226 youths in out-of-home care supervised by juvenile probation. Data collected during the review process is aggregated at the end of each fiscal year, and reported in our annual report submitted to the Legislature on september 1st. In addition, quarterly reports containing poin time data are submitted to the Legislature ond june 1st. Each year. The reports include recommendatio for re dhhs, probation and the courts. Onepoy our office is the duly involved youth population. These are court involved youth in ouout-of-home care who are simultaneously involved with the child welfare system and the juvenile jce system. In fiscal year 2526, the reviewed 143 cases of youth who were duly involved at the time of r review. On june 30th,2026, thy involved youth in out of home care or trial home visit in Nebraska, making up 4.4% of the total children and youth in out-of-home care. Over time. Our data has shown that dually involved youth tend to have worse outcomes than youth involved with dhhs or probation alone. Duly involved youth spend more time in out-of-home care a median of 511ays. They have the highest average number of lifetime placements at 9.7, 43.4% were in a congregate care setting, and of those youth, 15.6% were in a correctional setting and 22.7% were placed in a psychiatric residential treatment center. Of those placed in a prtf, 70.6% were placed out of state. Ten of the duly involved youth were missing from care. Onune 30th, 2026, 59% of the duly involved youth were boys and 41% were girls, while the number of duly involved youth in out-of-home care fluctuates from one quarter to the over the last two years, we've seen the number of duly ived youth trending upward. The most recent point in time data shows a 17.7% increase over the previous quarter. All five of the dhhsce aas experienced an increase over the previous quarter for cases th were revie in in fiscalar 25e outcomes, 69.2% changed schools due to the most rent out-of-home placement, and only 38.8% were on target in all of their core classes. Significantly, 90.9% of the duly involved youth had a mental health diagnosis. However, only 53.1% of those with a diagnosis were making at least partial progress on improving their mental health.
39.9% had a diagnosed substance use issue, with only 49.1% making progress with with their substance abuse, less than half, 46.2% had a primary permanency plan of reunification or family preservation. Thank you for the opportunity to speak with you today, and tou f concer for children and families. I have a lot mor da in my annual report and I. In your han is a copy of the entire duly involved youth section from our current annual report. I'm happy to answer any questions. Any questions from the Committee? Senator dorn. Could you explain what, what at age are all of these kids do they get. Or in other words, do they get at 21? Are theymati? What year or how young do we have kids in the system and stuff like that? Well, for the with the juvenile justice system, it would start at age 11. Due to recent changes in the law, our data we tend to. With our review data, we start at age 13 through 18. So in Nebraska, the age of majority is 19. So all of this data that we have goes from. But with just that juvenile justice population, we don't we don't include anybody that's younger than age 11. The six, the 69. Oh, I forget what number I six and a half of those kids, what the greatest percent of that population is made up of 11 and 11 through 19 or what. Break that down a little bit. How many I call it real. Young kids are in this. The the data that I presented, there wouldn't be any under the age of 11. So we have additional data on children. Well, as young as infants, we have additional data in our annual report. But this particular data only includes thatlder yth population because that's who is being served by probation. What whatpens when they age out at 19 or what? What are they just we have we have programs including the bridge to independence program,r care program for 19 through up to age 21. And then there are some other programs that are available. To, to help youth up to age 26. And I think youth who age out of foster care at 19 are eligible for medicaid until age 26, just as if they were on r parents insurance until age 26. Thank you for being here. Senator strommen. How many children are in total? Maybe you don't know this, but and it sounds like it fluctuates, but how many children total are inystem stat? There are. Well, as of june 30th, 2026, there were 3954 children statewide in out of homee or a trial home visit, which means they're they they were removed from their parent. They returned to their parents home, but they remain wards of the state. And there the court retains jurisdiction. So, you know, they're still under supervision. Okay.
And of those, 173 are this duly involved population served by both the probation system and the dhhs system. Senator prokop. Thank you. So I'm looking at the data around placement changes resulting in school changes.nd I see statewide 70%,y shocking number as far as changichools two questions. One is, do you have that broken down by grade level as well? Do you do an additional just because it's dramatic, you know, between talking younger kids versus maybe a little bit older ds? And then just interested in any information about what type of coordination is done with the schools as that those kids are, are being moved. You know, that's a, that's a pretty dramatic change for, for a young person. And what's, how does that look? So that they're set up for success in their school. So we don't have it broken down by, by grade level. What, what causes those school changes is, is placement itself. So if they're going into a, a facility, for example, it may not be in their local community, maybe in a different community, even foster homes in especially in the rural parts of the state, are not always in close proximity to where the parents live. So that causes a school change. I think the. The result is it it impacts their lg. Impar academic outcomes. And that's something that. We are trying. The state of Nebraska is trying to remedy through the program that the department of education is implementing with the statewide academic record, so that the department of education is tracking their creditsle they're mov from facilit facility or placem to placement, even out of state, so thathey're comg while they're in those facilities. And that hasot always been the case in the past. And just how, how, how is how does the communication take place with the schools the as they're knowing, you know, child a, b, c is coming, you know, what kind of things that they're coming in? How does that work? Well, I'm not sure that I'm the best person to answer that, ian I can tell you from the experience I h working through that LB 96 process and the belherrocess, that itotlw g communication. Okay, that it waspening through paper in a lot of cases, faxes going back and forth. Andhere wasn't always prompt replies. And so it communication was a significant issue. Okay. Thank you. Any other questions from the Committee? I have one comment to follow up on. Senator prokop. My brother was assigned to the omaha voice, which is in north omaha where we grew up, but he was redirected to their hh scuring the time he was there. Then he got out less than a year later, had to find another high school. And so they do move them around. Thank you for your testimony. Thank you. Now we will invite alison des from Nebraska appleseed. I hope I said that last name correct. You did. Thanks. Good morning.
My name is alison des. A llisonderr, and I'm with Nebraska appleseed, which is an advocacy organization that works in part to improve Nebraska's child welfare system. And the intention of my testimony is just to sely foc on title four child welfare funds to ensurehat, as this Committee is considering using four e to help support cross-system young people, it has a good foundational understanding of four e and Nebraska's historic use of it. Four e is the largest and primary source of federal child welfare funds, helping states fund their foster care systems. It covers things like foster care, maintenance payments, foster care, prevention services, administrative costs, and more. And hopefully four e is an open ended entitlement program, meaning it is in theory, unlimited. And so long as the state meets federal requirements and the federal government agrees and expense is eligible, states are entitled t be reimbsed for a portion of what they spent on child welfarehings. Historically, it's important to know that Nebraska's use of e has been very low, especially compared to other ate in my wrteesti I have a couple statistics. I highlight, maybe just a few, ich iso say that in fiscal year 23 and fiscal year 24, Nebraska the lowest rate of four e usage and a number of measurements. For example, in fiscal year 24, we have the lowest rate of foster care maintenance payment use at 10%, with the state average being 33% and the highest states usage being 82%. So that is a big difference in in our experience, that difference in lowe use has been a perennial conversation and issue among both state and national child welfare and fact, over the lt ten years, at least six separate evaluations of Nebraska's chd welfare system commissioned by this Legislature, the department and the state have pointed to funds as an issue and concern, d most recently, in 2024, epiphany associates assessment of Nebraska's just general spending pointed to our low use of four e funds as a significant missed opportunity, and one where we could save $10 million if we were to draw down more funds. And the department agreed with that take just last year before this Committee. I think it is important to point out that Nebraska's use of four e has been steadily increasing over the past years, which is great, and the department has taken some really signt yr, in regards to prevention funding with four e. There's also a lot of justifiable reasons why fo four draw down. And we'vee really earnestly say they'rek, doing everything they can with four e. But even with all of that said, because the difference between Nebraska and other states is is do think maybe there is something we might be missing.
And in relation to this inter study, young people who are cross system may be an example of an opportunity that we're missing and has already been said today that auditors 2025 report on probation did find that four e is a source ofunds t Nebraska is and drawing down to support these young people. And we understand that those are funds that state could use to support those young people. There may be some justifiable reasons why the state hasn't done that so far, but the auditor did find that's partially because probation and the department weren't cooperating. And so to know that at least some of the reason we're not using four e funds is because state agencies aren't cooperating. It does feel a little bit frustrating and I do think warrants some questions and work by this Committee to just triple check that we as a state are, in fact, doing everything we can within ourtrol tow mbe w a but it is worth triple thet point that we wanted to make. It's a bit of a side, but related didee that the auditor's report sugsted that the state requires families to pay for more of the services that they' receiving while in the juvenile court system. And we just wanted to remind this committeehat well over the majority of young people and families in these systems are lownc and a lo are in the system because they're low income. We hear from families all the time that they come in the system poor and lm poorer. So to the extent the state is going to require families to draw on all of their available resources to pay for services, we think the entity is in charge of caring for those families should also be drawing resources, like four e, to ensure that cost burden on families is not too high. So in conclusion, as this Committee is thinking about using four e to support cross-system youth, we encourage it to continue asking questions of the department and state, ensuring we're using all of those funds. And the ct burden on the state and families is not too high. Youor yourime. Thank you for your testimony. Any questions? Senator cavanaugh? Thank you. I and you might not know this, but youalked about the auditor's report and the due to lack of cooperation between probation and the department. Do you recall what that meant? Lack of cooperation. My reading of the auditor's report. I don't believe the auditor described in detail, other than there was a lack of a contract between probation and the department because it's already been in control of 40 funds. And so the auditor's report showed that there needed to be a contract between probation and the department to allow the department to give ation funds. I don't know much more than that. A good question for the department. Thank you. Enator. That's me. I want to y norman. The.
Is erematc requiref thes funds? There is, yes. So it depends on thee of for e expense, there's different categories. I think the helpful thing to first understand is that for e is reimbursement. And so the state has to to pay for child welfare first. And then it submits to the federal government to be reimbursed. The general for e reimbursement formula is two different figures, as inderst I theigure I a set percentage. And so some things e 50% as kind of a baseline. Other things are connected to the f map. I think Nebraska's I could be wrong, and I hope the department corrects me. I think is 54%. So some things 50%, some things 54% fthe frontend,n% forome administrative cost. And then you take that set percentage, and it's times by how many young people in our system are for e eligible. So which is complicated, but essentially you would take the set percentage like 50% times how many young people in our system are for e eligible. And then that is the percent of reimbursement the state would receive. Generally, the complicated piece, there is something that is outside of the department, and Nebraska's control is how many young for some, for e expenses, young people have to be considered low income, and that low income amount was set in, I believe, 1996 and hasn' been raised.and h inflation, that is extre low. And so year by year, less and less you people are eligible because of that income limit. And that' something outside of theartment and Nebraska's control. And so that is is teimbnt and incrse the percentage of match funds by the state year to year. Is that lowe based on poverty level, this is like 170 or. 100 in 1996. Okay. And each. Level, y, but e had choose in. It was connected tohe adc levels that states hadse 1996. So it was a cice Nebraska the of my head, I think our level from 1996 is maybe the 17th lowest of all of the states. So we're, you know, kind of in the mdle to the low end in a pose way. But that is one thinghat ca fromtate to state and certainly affect the level ofmae federal government. Okay. And again, I, I, I hope the department corrects me if any those numbers are wrong. That's what I know in theory. Any other questions? Thank you. Thank you. Testimony burt that we'll have our final testifier of john meals from the department of health and human services. Good morning, chair armendariz and memrs oe appropriations comttee. My name is joh meals johnmeals, and I'm the chief financial officer for the department of health han ss h testify on LR 452 examining cross system services between child wel and juvenile justice. Since the passage of LB 561 in 2013, the office of probation administration has been responsible for most juvenile justice supervision and services.
While the department remains responsible for child welfare, youth are duly involved are served by two systems,ach with its own funding rates, rules and court dockets. The department funds suppor for c wel pro chil welfare aid and state fial year 26 welfare approxim 251 million, of which 183 million was state general funds, 68 min was fel funds. Nebraska, ptember 2026.itle 40 foster within child welfare aid, th rtment pays education transportation costs for students who are wards of the state or of the court through the state ord education fund. Cos are shared largely depends on use legal status. En a court places a youth with the department or commits a youth to its custody, the department pays. When a youth is under probation,ervision probation pay statuteo the s of the case. Department is often paying for decisions it does not make. Statewide education fund is the clearest example of this state law makes the department the payer for the education and transportation of students who are wards of stf the court. Most of these rates are set by the department of education in fall of 2025. The fund serves 741 students, 609 of which are wards of the court, 46 are wards of the state and 86 were adjudicated court in state wards, court wards accounted for over 90% of students and over 80% of the funding. Federal funding. The primary sour has been previously mentioned for child welfare poon ishe title 40 fostare title 40 prevention services underheamily first prevention services act, or fpsa title four b, and then medicaid. Title 40 is limited for probation youth for a couple reasons. First, fer law es not allow it to pay for youth in detention or other secure settings. Second, because the department is the only freeceme that probation, probation arng andfor do not currently qualify, while dhhs division of children and family services always attempts to place within the least restand homelike setting, possible congregate care facilities, including psychiatric residential treatment facilities or prfs, are considered a last resort for youth and child welfare system. We have less than 4% in congregate care, while the national average is %. The department is reviewing opportunities, including in title 40 agreement with probation,anded ention services and a more robust continuum of care pathway for high acuityouth. Lastly, regardingmburment, the department sets rates for child welfare providers. The 17% service rate increase was implemented in fiscal year 23, followed by additional increases that were funded by the american rescue plan act, or arpa funding. In fiscal years 24 and 25. The department has sustained those increases even with the arpa funds expiring. Thank you for your time, and I'm happy to answer any questions you have for me. Thank you. Any questions, Senator cavanaugh? Thank you. Thanks for being here. I recognize that you are not the head of child welfare. I appreciate you recognizing that. So I'll do my best. Yes, I will tryo keep myques. So. Okay.
First, you said for foster care penetration rate is 27.3. Can you dumb that down for me? What does that mean? Penetration rate. So previous testifier was talking about you have the full child welfare population. And then there's the portion of them that are eligible for for free. So the penetration rate means of all of our population, 27% of them are eligible for free. Oh, okay. So it's not that out of 100 that are eligible for free only 27. Correct. It means if we have 100 kids, 27 are eligible. Okay. Thank you. That because I was like, oh, no so and then you mentioned I had a question already about a contract with probation, but you said the department is reviewing opportunities, including an agreement with probation. So it sounds like this lack of agreement, probation is one of the stumbling blocks to drawing sense of how that's happening or what the progress is on, on rectifying that? So again, I've been in some of these meetings. I know members of probation have been we've been having them. I think they're either monthly or every other month. Probation would know better for about a year or so, trying to work on a, a four year agreement. Some of the issues that I would point out and why they're not typically eligible. Yeah, I saw those. I guess I'm not concerned about when they're not eligible. It's more if there's not an agreement, then they can't get the funding correct. So we're working through that, helping them design a four year plan that we can submit to the feds, that then their placements would approved b we'ree agency. So probation is the only one doing the placement and we're not involved, then they're inherently not worry eligible. So we have to be involved. So if we have an agreement in place, then it is theoretically possible for them to be there's other requirements that would have to ki of one.t an agreement is so again, I know you're not the head of child welfare, but how long have we been not having an agreement? Because as we've seen, at least in our eigh years, we have always been behind on funding. And this seems I didn't actually realize that we were also behind. We didn't have this happening with probation. So we're working through with probation as quickly as we can. I mean, as soon as those conversations are resolved and we come to an agreement on how we do this, then it shouldn't be much longer. So is this a long standing issue, I guess is my question. Yes. Okay. I have some other questions, but maybe. Any other. Okay. So we had we'verd about having consultant. Consultants came in and they said that epiphany that one of the main things is for funding. And, and I was like, yeah, it sure is.ee seenny gains in for funding drawdown?
And, and what role have they played in helping facilitate those gains? They've helped us analyze, you know,ifferent rtunit we've worked with pbation on some these opportunities. We've I kd with. So sorry, could you say that again? Don winstead he's a an ex fed that we've been working with to help understand ways e can increase reclaiming from acf. A preous testifier mentioned it, but I just I want to give an example of what is probably the biggest deterrent to this is the a ftc rule from 1996. Just to give an example, like a family of three, the income requirement to to be fully eligible is $492 a month. And if you are above that, then you are not eligible for a family of three in Nebraska. And again, there's. That was based on 1996, 30 years ago. There's would love if we could get ahold ofeds d change that. But there's not much that we can do about that. So that's pretty low. It is. I think that's lower than tanf. Well, it's based on that's afdc is the original adc program from 1996. Okay. Yeah. So. Trying to think of how to ask this question. So we. I guess I like to, especially since I'm going to be gone in a couple months, give some histical context to our funding. But I kno y were y h only en in thissition. Six years. Six yea well, then you might know this.o we one of the reasons that we changgea, and eliminated our contrtr with p ship was that there was going it was going to cost significantly less. In fact, their bid was 40% less. And one of the main things that they had as their ct savings was an incased drawing down of 40 funding, which they actually then went on to decrease for funding by like 80%. Have we made gains back since that time? We have. So our back then I don't have those numbers in front of me, but it's off the top of my head. Back then, our penetration rate was in the teens, and we've worked over the last 5 or 6t years. It' been it kind ofluctuates depending on the youth as they come in and out of the sm.but in the high 20s and the low 30s over the last couple of years. So we I would say in the lt 6 or 7 years, we've roughly doubled the amount of the youth that a eligible for free. Okay. And then do you see in all of thisny opportunity for overlap in funding or some efficiencies and maybe eliminate those for us? Yeah. So I mean, one of the things most recent change from the feds, which we're working through, what that would mean for our budget, is for prevention services, which we're working investing in through united way of the midlands thr one,one and ot pren services through community collaboratives.
Now prevention services can be matched at the fmap as opposed to just plain 5050. So we get an extra instead of being 5050, it'll be 5545 moore federal and state fus. And that is just aal moneyt offsets state costs. So that's one thing we're looking at. And th again, in collaboration with probation, I think right now we've identified that there's around 30 youth, give or that if we get an agreement ince, sof our services would eligibl the big thing is, is getting it correct on the front end. There are requirements to be free eligible, that there is a it has to be in the best interest he childe removed from thome, and tsthe initial court d that's not always the case when it's probation, because. That's part of the agreementhe discussion that we have to can f the gs on the front end of a case, because if that's not in there at the very beginning, the first time that there's a never full eligible. So like, that's one of the things that we're working through with probation. And one more scary question for everyone in this room. Can we expect a request for provider rate decreases. From hhs? Yes. No, ma'am. Okay. Any other questions, Senator? Thank you. Chairman. Thank you for being here today and stuff. I pulled up out in the parking lot and I go, oh, I must have the wrong time. Senator clements kauth in here. So, you know, I came in here and understand why. Thank you for being here, john, and thank you for eight years or as long as you and I hhae great conversations and explanations and stuff. This 1996 rule, what? We'r married to that forevr this 1996 rule, what? We'r married to that forevr I mean to say we can't change it or what? What feds change the law. That's what the program is tied to. It's tiedtoe utilized by the tanf program, 80 dependent childrenn 1996. And that's what the for you program, whether that's foster care, adoptio guardianship. It's tied to that 1996. Well. The fedset. And the sta of Nebraska doesn't get to help. I call it help make a decision to change that or anything or I mean it why and why it maybe you could give a little explanation. Why did we settle on that rate then or what? Why not a higherr. I've been here for six years. I haven't been here for 30 years. I know. Neither, I don't know what we did or why we did what we did in 96. I just I mean, yeah, it's something that has been brought up by a lot of states to the federal government. It's an ongoing conversation from the federal perspective. I mean, obviously it it would cost them much more money if they updated it. So it it makes sense why they don't want to address it.
But there are many states that, I mean, we are not a in lowe 40 penetration rates. So there are many other states that would be beside us in asking for change, but it would be the federal government that has tma that change. But it will take maybe re oomething like that to change. Okay. Thank you. Thank you for explaining that. Yeah. Senator strommen. Follow my line of thought here. How many how many children are in child? That's child welfare program. So we've got $251 million that we're spending on child welfare. What is how many children are we? I believe it's roughly around 3000 just under. Wean get back to you with the exact number, but it's around, I think, 2900. Or so, the same as the foster care number. Yes, that is 390. Whatever that is. So we're spending about $65,000 a year per child. Is that that's what, 250 million divided by that number then? Yes, sir. Okay. Any other questions? I have a question. If I could drill down on the duly involved. Sure. So previous testifier said 173, I believe as of june. So how many of them are not qualified for for e because of income or placement b sti in foster. So the total number of youth changes based on. As kids come in and out of each system. What we have looked at, I, I don't conversations withou probati just what our team has looked at. We've identified that we think around 30 kids would be eligible. So if there's 170, then 140 of them would be ineligible. We believe that there's could ironut the agreement. Okay. I'm wondering where that previous testifier saw the $10 million opportuni. If so. That could qualify 30. That was completely separate from julie adjudicated youth. That was just a general thing that hhs workedn with tny over t las of years. And that was more tied to like gett ks letter of kids that we have on letters of agreements or using another acronym. Any youth that we have that are outside of our typical rate system, we, I, we utilize what's called a letter of agreement so we can pay more for the placement. There are certain protocols that we have to follow to get 40 claiming for them because they fall outside of our our regular system. There was also claiming that we could do with development of disabled youth that were in our system, additional medicaid claiming. So it was overall a number that was tied to hhs increasing federal dollars. It wasn't necessarily specific to newly adjudicated youth. But $40, $40. Correct. Okay. So you're what you're saying because of the income limits or their placement limit, about 30 of the 173 might qualify for 40. Correct. Okay. All right. Thank you. Any other questions? With that we will clo testifier testimonies for lr for 52. And welcome Senator spiy back for questions.
Thank you, vice c armendariz and members of the appropio committeei really appree your engageme and great que during this hearing, especially early in the mng ap minds around this complex and topic, a co os th wanted to give feedback to with some of the questions. Vice chair armendariz, I'll start with yours. Earlier in my opening, I kind of talked about that, that in general, when we think about federal funding and what we are drawing down, there's opportunity. And I think you name that of can we think about federal fundi being leveraged with specific agencies?know s is one of our largest agencies with the high budget. And then specifically for this group of young people at we continue to talk about that are in both agenc child welfare and juvenile justice. Can we have better synergies around that federal funding? So I you absolutely nailed that that that is kind of the two parts of that question. There is a study by let me get this name right. The national center for juvenile justice. They look at a d youth and what are our efficiencies and what they put out in the repor thai hope, again, from this conversation that we continue to have with both agencies is we don't have data sharing agreements. And so when you look at states that have better effectively serve youth as wells supported in the fiscal management, that there's that data sharing agreement and that there is actually a statute requiring collaboration. I think Senator cavanaugh, that was kind of your question. Right now, we have an informal agreement agencies. But if there was policy and statute that really outlined the structure and the payment, that that could also support better servicing this, these specific youth that have more complexities and are costing more dollars within that way. So I just wanted to uplift that. Senator dorn, you named with jean cotter like, well, you know what happens, like what happens with the budget? And if you remember when probation came, you know, when it was supreme court day for hearing, they had a list of services that would get cut and they prioritized, hey, if we have to continue to move going to start to cut. And ontse that list were some of these pes of services prevention. Some of the div services that we know that if we invest inhe front end, w spend less money because these kids are not going into prison, they're not going and being detained. They're actually getting rehabilitative services that they need in order to come back to their families and community. And so I think to your point, is that we're going to have some decisions that we need to make. And the intention of this lr is that how can we get ahead of that? How can we find efficiencies? How do we best serve these young people?
Because we know that there's going to be things that and services that these agencies will prioritize for f cutting based on the fl from jean, justt probation that the Committee asked. So 12% of all probation kids are in out of home placements. Oh, wait, out of out of state placement. Sorry. I, I messed up my acronyms out of state placements. And then 724 are out of home as of today, 467 of those 724 out of homeplae detention. Some a runaways. So there's a mix of where tse kids are. But we have 724 as of today and out of home. And so when you think if they are out of home, that means that they are touching some of the child welfare system, or there's a reason why that there's a need to note inho ther those kids. And so I think, again, with, with all of the information that was presented today is that it is very complex and we are in a about as appropriationse talk Committee, we make really hard decisions about a budget that there are actual, in this instance, kids that are behind our decisions and the success that they will have as young adults navigating, being out of home because of trauma and then now criminal charges, potentially. And so I want to be able, as a Committee to make informed decisions and figure out how do we find efficiencies. So we are using taxpayer dollars wisely. We're ensuring that agencies are working together and that these young pe are actually getting the support thathey need,especiallye increase of mental health supports and diagnoses that may be causing them to have these experiences. And so I really appreciate each of you, again, for your engagement and your work previously on this issue. Hopefully, this lr provided better grounding and opportunities that we can work through as a Committee. I appreciate all of the testifiers for coming today and their points of view that they bring, and I'm reallyng forward to this mng because thit collaborative space will really allow us to have discourse, figure out some policy interventions that we can bring for 2027. So with that, I would answer any additional questions that the Committee may have. Any questions of sen. Okay. I app yourime and your stimony today. With that, we