GAB Decision 706
November 21, 1985
Maryland Department of Human Resources;
Garrett, Donald F.; Settle, Norval D. Ballard, Judith A.
Docket Nos. 84-33 and 85-70
The Maryland Department of Human Resources appealed a determination
by the Office of Human Development Services (OHDS) that the State was
ineligible for fiscal year 1982 funds under section 427 of title IV-B of
the Social Security Act (Docket No. 84-33). The State subsequently
appealed a determination by OHDS that the State was also ineligible for
section 427 funds for fiscal year 1983 (Docket No. 85-70). Since the
appeals involve common issues of law, we joined them for Board
consideration.
Section 427 of the Social Security Act (Act) provides that a state
may
receive additional funds for child welfare services, beyond the
amount
available under section 420 of the Act, if the state meets
certain
requirements for protecting children in foster care. OHDS
initially
approved Maryland's request for additional funds for fiscal years
(FY)
1982 and 1983 based on a written certification by the State that it
met
the requirements of section 427. Subsequently, OHDS performed
a
compliance review to validate the State's self-certification.
OHDS
evaluated the State's compliance on two levels: whether the State
had
established policies and procedures for implementing the
requirements
and whether these policies and procedures were operational.
For each fiscal year, OHDS determined that the State had policies
and
procedures for implementing the section 427 requirements;
however,
after surveying a sample of foster care case records, OHDS found
that
the requirements were not actually met in a sufficient number of
cases
to constitute compliance. OHDS directed the State to return
$1,296,770
received for FY 1982 and $2,041,756 received for FY 1983. /1/
(2)
The State challenged the review process used by OHDS on a number
of
different grounds and also contested the findings in some of
the
individual sample cases for each fiscal year. For the reasons
stated
below, we uphold the compliance review process generally, but
reverse
the findings in 3 of the individual cases. OHDS conceded that,
if the
Board reversed the survey findings with respect to any individual
case
for FY 1982, the Board should then remand the case to the Agency
to
continue reviewing FY 1982 cases according to the sequential
case
sampling method. TR II, p. 248. /2/ OHDS also has a policy under
which
the Agency would withdraw the FY 1983 determination if the State
is
ultimately found to be eligible for FY 1982 funds. TR II, pp.
249-250.
Accordingly, as agreed at the hearing, we do not address the
individual
cases from FY 1983 here but remand to OHDS to continue the FY
1982
review and then to take whatever action is appropriate for FY 1983.
The
State may return to the Board if OHDS finds the State ineligible for
FY
1982 funds based on the continued review.
Background.
The Adoption Assistance and Child Welfare Act of 1980, Public Law
96-272,
amended the program of child welfare services under title IV-B
of the Social
Security Act (Act) and also established a new foster care
maintenance program
under title IV-E of the Act. These amendments were
precipitated by
studies which showed that the public child welfare
system had become a
holding system for children living away from
parents, rather than a system
assisting parents in carrying out their
roles and responsibilities and
providing for alternative permanent
placement for children who cannot return
to their own homes. Thus,
Public Law 96-272 had three major goals:
* Prevention of unnecessary separation of the child from the parents;
* Improved quality of care and services to children and their
families;
and
* Permanency through reunification with parents or through adoption
or
other permanency planning.
45 Fed. Reg. 86818 (Dec. 30, 1980).(3)
Among other things, Public Law 96-272 provided that states could
obtain
additional funding for child welfare services, beyond funding
available
under section 420 of the Act, if certain conditions were met.
Specifically, section 427(a) of the Act provides that a state will not
be
eligible for additional funds unless the state has conducted an
inventory of
foster care children and "has implemented and is operating
to the
satisfaction of the Secretary" a statewide information system, a
"case review
system" for each child in foster care under the supervision
of the state, and
a services program designed to return children home or
place them for
adoption or legal guardianship. The term "case review
system" is
defined in section 475(5) of the Act as a procedure for
assuring that each
child has a case plan and a "periodic review," and
that other procedural
safeguards (including a dispositional hearing) are
applied.
Regulations to implement section 427 and other provisions of Public
Law
96-272 were proposed on December 30, 1980. 45 Fed. Reg. 8618.
These
proposed regualtions were subsequently withdrawn and a new notice
of
proposed rulemaking was issued on July 15, 1982. 47 Fed. Reg.
30922.
The final rule was not issued until May 23, 1983. 48 Fed. Reg.
23104.
In the absence of regulations, OHDS (the operating component of
HHS
responsible for administering titles IV-B and IV-E) devised a
system
under which states seeking additional funding under section 427
would
submit a self-certification of eligibility, indicating in writing
that
the state was complying with the applicable statutory
requirements.
OHDS then developed its compliance review process, which it set
out in a
program instruction issued to regional program officials.
Under that
process, OHDS reviewed a state's procedures and policies and
also
reviewed a sample of case records.
Maryland certified its eligibility for section 427 funds in FY 1981.
OHDS
reviewed the state's compliance for that year and determined that
the state
was conditionally eligible and therefore could retain the
funds. As
indicated above, however, Maryland was subsequently found
ineligible for
section 427 funds received by the State for FY 1982 and
FY 1983.
Although Maryland was found to have implemented the
appropriate practices and
procedures in each year, Maryland "failed" the
sample case record
survey: 17 cases were found unacceptable for FY 1982
and 15 cases were
found unacceptable for FY 1983. Under the sequential
case sampling
method used, these findings resulted in a determination by
the OHDS regional
office that the State was not complying in 80% of its
cases. The
regional office recommended for each year that the State be
found out of
compliance with section 427, and these recommendations were
ultimately
adopted in the decisions, by the(4) Commissioner,
Administration for
Children, Youth, and Families (ACYF, a subagency of
OHDS), which the State
appealed to this Board.
The issues.
The issues raised by the State fall into two general categories:
questions
regarding the compliance review process set out in the OHDS
program
instruction and questions regarding the "case review system"
requirements of
section 475(5) as applied in individual sample cases.
The State attacked the compliance review process on three grounds:
(1)
that the process set out in the OHDS program instruction (PI 82-06)
was
inconsistent with the statute; (2) that the process was invalid
because
the instruction was not promulgated using notice and comment
rulemaking
under section 553 of the Administrative Procedure Act; and
(3) that
reliance on the process here was inconsistent with Agency policy
as
stated in a letter from the Assistant Secretary for Human
Development
Services. We discuss each of these areas below and conclude
that the
process is a valid one, consistent with the statute and with
OHDS
policy.
We then address whether the State met the "case review
system"
requirements in specific cases found unacceptable for FY 1982.
The
major issue raised by the State was that the findings for eight
cases
were erroneous because the State reasonably interpreted the
periodic
review requirement to not apply to children in permanent
placements.
(As we discuss below, we apply a standard of whether the
State's
interpretation is reasonable because OHDS agreed to this standard
for
states self-certifying compliance in the absence of OHDS
regulations.)
We conclude that the State's interpretation was a reasonable
one, but
disagree with the State about whether all of the contested cases
were
such permanent placements at the time the periodic review would
have
otherwise been due. We examine the individual contested cases
and
reverse the OHDS findings in three of those cases for FY 1982. /3/
(5)
I. Analysis of issues regarding the compliance review process.
A. Whether the OHDS decision is consistent with the statute.
The State challenged the OHDS review process and the resulting decision
as
unauthorized by the Social Security Act and violative of the Act and
Public
Law 96-272. The State's major arguments were that the Secretary
could
not impose "fiscal sanctions" under section 427 and that the
decision was
inconsistent with the goal of Public Law 96-272. The State
further argued
that the Secretary should have found the State to be
operating a satisfactory
system because the State was meeting
requirements designated as "minor
safeguards" by OHDS and because the
State had taken corrective action to
improve its foster care system. We
address these arguments in this section
and conclude that the OHDS
actions are authorized by the statute and
consistent with its goals.
According to Maryland, the language of section 427 does not
specifically
allow withholding money for non-compliance, and, further,
"Congressional
discussion of Pub. L. 96-272 reveals no statement that
Congress
considered penalties against States for failure to comply with
technical
requirements of the Secretary." State's post-hearing br., p.
40. These
arguments are premised on the mistaken view that the OHDS
action
constitutes imposition of a sanction or penalty on the State. To
the
contrary, the OHDS decision is essentially a finding that the State
was
ineligible to receive the funds in the first instance and,
therefore,
must return them. This action is consistent with and,
indeed, mandated
by the language of section 427(a). That section
provides that "a State
shall not be eligible" for additional funding "unless
such State" meets
certain specified conditions, including that the state has
implemented
and is operating a case review system to the satisfaction of
the
Secretary. The statute simply does not authorize payment to a
state
which has failed to meet the specified conditions. It necessarily
flows
from this that a state which has received the funds, but is later
found
to be ineligible for those funds, must return them. (For a
further
discussion of this issue, see Ohio Department of Public
Welfare,
Decision No. 472, October 31, 1983, at page 7.)
The State also argued that the goal of Public Law 96-272 is to
encourage
states to develop foster care systems which seek to prevent entry
into
foster care and encourage the rapid movement of children from
foster
care into permanent placements. In light of this goal, the
State
argued, the State should have been found to be in compliance
with
section 427 because the State had made significant progress in
achieving
this goal in general and in particular had achieved this goal in
the
individual sample cases(6) in dispute. The State further argued
that
loss of the section 427 funds would harm its foster care system and
that
Congress clearly did not intend such a result. While we agree with
the
State about what the general goal of Public Law 96-272 is, and have
no
reason to disbelieve the State's assertions about how it has met
that
goal, we think this is irrelevant to the question of whether the
State
is entitled to additional funds under section 427. In that
section,
Congress chose a specific means to achieve the broad goals of Public
Law
96-272, providing incentive funds only for those states
which
implemented a case review system of the type specified in the
statute
and which were operating that system to the satisfaction of
the
Secretary. While it may be laudable if a state has made progress
in
improving its foster care system through other means, this progress
is
not sufficient to justify an award of section 427 funds to a state
which
has not met the specific statutory requirements. Moreover, while
loss
of the funds may make it temporarily more difficult for a state
to
improve its system, the risk of loss is always there when Congress
uses
the federal pursestrings as an incentive to state action. If a
state
could retain the funds, even if it had not met the statutory
conditions,
it would not have the incentive to make the necessary
improvements.
Indeed, loss of the funds can be an incentive spurring the
state to
action. Thus, we conclude that the OHDS action is consistent
with the
statutory goal.
We are also unpersuaded by the State's argument that OHDS should
have
found the State's system satisfactory because the State took
corrective
action to improve its system. Although the State provided
considerable
testimony and written evidence to show what its corrective
action plan
was, we agree with OHDS that much of this evidence is
irrelevant. Most
of it pertains to actions taken by the State
subsequent to the years in
question here, and much of the material relates
not to correction of
problems in the State's case review system, but, rather,
merely
evidences the State's implementation of other programs mandated
by
Public Law 96-272, such as provision for pre-placement
preventive
services and reunification services. We think that, in
basing its
decision on an evaluation of how the State was actuallly operating
its
system in the fiscal years in question, OHDS acted consistently with
the
wording of the statute which requires that a State "has implemented
and
is operating to the satisfaction of the Secretary" a case review
system.
Even if the statute permits the Secretary to consider
operation
satisfactory based on a corrective action plan, however, nothing in
the
statute mandates that result. We think OHDS acted reasonably in
not
adopting that approach, but in focusing instead on the
State's
performance in the year for which the funds were claimed.( 7)
Given that the statute leaves the determination of what is
satisfactory
operation to the discretion of the Secretary, we also reject the
State's
position that it should have been found in compliance because it
met
those requirements designated by OHDS as "minor safeguards." The
Agency
could have reasonably determined that a state's system should not
be
considered satisfactory if a state failed to provide the
"major
safeguards" (having a case plan, holding a timely periodic review,
and
holding a timely dispositional hearing). Indeed, the Agency's focus
on
the timeliness of a state's actions is consistent with one of
the
primary purposes of Public Law 96-272, which was to avoid the problem
of
foster care "drift." While the "minor safeguards" may be the "nuts
and
bolts" of successful casework practice, as one State witness
testified
(TR I, p. 202), nothing in the statutory language or legislative
history
mandates that they be given equal weight with the "major safeguards"
in
a section 427 compliance review.
Finally, we note that the compliance review process as set out in PI
82-06
more than adequately took into consideration problems which a
state might
have in putting a case review system into effect. In the
first year of
certifying compliance with section 427 requirements, a
state need only have
implemented the procedures by the end of the year
and have 66% of the sampled
cases accepted. In the subsequent years,
only 80% of the sampled cases
had to be accepted. Moreover, grace
periods were applied so that states
were not penalized when reviews or
hearings were late only by a matter of
days. Thus, we do not find the
Agency's approach overall as being one
of holding the states to
technical requirements; rather, a state's
failure to meet even the
minimal standards set out in the program instruction
is an ample basis
for finding the state's operation of its case review system
to be
unsatisfactory.
B. Whether notice and comment rulemaking applies to PI 82-06.
The Administrative Procedure Act (APA) provides at 5 U.S.C. 553 for
public
participation in rulemaking through a notice and comment
procedure.
Section 551(4) of 5 U.S.C. defines "rule" for purposes of
the APA as
follows:
"rule" means the whole or a part of an agency statement of
general or
particular applicability and future effect designed to
implement,
interpret, or prescribe law or policy or describing the
organization,
procedure, or practice requirements of an agency. . . .
Section 553(b) provides that the notice and comment procedure does
not
apply to "interpretative rules, general statements of(8) policy,
or
rules of agency organization, procedure, or practice;. . . ." /4/
The State insisted that PI 82-06 was a "substantive rule" because
it
meets the definition of rule in section 551(4) and because it
affects
substantial individual rights and obligations. State's
post-hearing
br., p. 36, citing Morton v. Ruiz, 415 U.S. 199, 232
(1974). The State
argued that PI 82-06 "does not merely interpret the
statute but provides
criteria which determine whether states receive relief,
i.e., additional
funding, under Sec.427." Id., p. 36, citing Pickus v. United
States
Board of Parole, 507 F. 2d 1107, 1113 (D.C.Cir. 1974). The
State
presented testimony and other evidence which the State said
demonstrated
that PI 82-06 is a substantive rule "because they demonstrate
that the
failure to comply with PI 82-06, leading as it would, to the
recovery of
funds by HHS, would substantially affect Maryland's foster care
system."
Id., p. 37.
PI 82-06 was issued June 3, 1982, to Regional Program Directors, ACYF,
by
the Commissioner, ACYF. The instruction is labeled "ACYF
Staff
Instruction," and the given subject is "Guidance to ACYF
regional
officials in validating State certification of Compliance with
Section
427. . . ." The 13-page document (with five attachments) does
three
things: (1) sets out the procedures for regional officials to use
in
reviewing a state agency's administrative requirements and in
sampling
the case records; (2) states the percentage of cases sampled
which must
be "acceptable" in order for a state to attain "conditional
compliance"
or "substantial compliance" (and when such compliance allows a
state to
receive section 427 funds); and (3) provides guidance in
interpreting
the "case review system" requirements of section 475(5),
including the
periodic review requirement at issue here.(9)
There is no real dispute concerning the first and third parts of
PI
82-06. To the extent that the instruction simply tells the
reviewers
what steps to follow in conducting the compliance reviews, it
is
exempted procedural material. Moreover, to the extent the
program
instruction provides guidance on how to interpret the "case
review
system" requirements of section 475(5), it is an
interpretative
document, exempt from section 553 requirements. /5/
The key issue concerns that part of PI 82-06 which informs
regional
officials about what standard to apply in measuring
compliance;
specifically, PI 82-06 states:
Assuming that the State has met the 5 major requirements of
section
427 (covered in the review of the State's administrative procedures),
a
minimum of 66% or 80% of sampled cases must be found acceptable for
the
State to attain conditional compliance or substantial
compliance,
respectively. To be found acceptable, a case record should
show
evidence of:
-- a case plan;
-- a periodic review;
-- a dispositional hearing (if applicable); and
-- 13 of the remaining 18 elements of section 427.
Conditional compliance (66% to 79%) allows the State FFP
under
section 427 for the year under review and provides an additional
year
for the State to meet the 80% (substantial compliance) level. If
65% or
fewer sampled cases are found acceptable, the State would be
considered
ineligible for its share of funds under section 427.
p. 11 (emphasis in original).
We think it is important to note, however, that PI 82-06 further
provides
that, if the regional office finds that a state has not met the
requirements,
the regional office should only make a "recommendation of
disapproval." PI
82-06 specifies that the final OHDS decision regarding
eligibility will be
made "by the ACYF Commissioner, after consultation
with the Regional Program
Director and the Assistant Secretary." Id., p.
12. (10)
This section of the program instruction basically states how OHDS
will
determine whether a state is satisfactorily operating a case
review
system. Thus, it is related to the exercise of discretion
afforded the
Secretary under section 427 to determine what is satisfactory
operation
of a case review system. In veiw of this (and the
Secretary's
regulatory authority under section 1102 of the Act), the question
arises
whether this part of the program instruction constitutes a
legislative
rule (i.e., a rule having the force and effect of law), subject
to
notice and comment provisions. While we could find no case directly
on
point, we conclude that the better view is that this part of the
program
instruction is not a legislative rule, because it was not intended as
a
binding nor, creating or altering rights or obligations. Rather, it
is
internal guidance, instructing regional staff on how they should
measure
states' past performance, but retaining central office discretion
to
judge whether that performance is satisfactory. Specifically, we
note
the following:
* Unlike the criteria for granting parole at issue in the Pickus v.
United
States Board of Parole case relied on by the State, the standards
here do not
wholly circumscribe the Agency's discretion. A finding that
a state did
not pass the case record review led only to a recommended
disapproval;
the Commissioner and Assistant Secretary retained
discretion to find a
state's system satisfactory even if a state failed
the review. See
Regular Common Carrier Conference of Am. Trucking
Associations, Inc. v.
U.S., 628 F. 2d 248, 202 (D.C.Cir. 1980).
* The compliance standard indicated in the program instruction is
not
intended as a standard having future effect on the actions of
the
public. See the definition of "rule" above; see also Herron
v.
Heckler, 576 F. Supp. 218, 230 (N.D. Cal. 1983), citing PBW
Stock
Exchange, Inc. v. SEC, 485 F. 2d 718, 732 (3d Cir. 1973);
Burroughs
Wellcome Co. v. Schweiker, 649 F.2d 221.224 (4th Cir. 1981).
As the
court noted in King v. Lynch, 550 F. Supp. 325 (D. Mass. 1982),
the
statutory requirements govern how the states are to conduct their
case
review systems and this is not changed by the fact that the
Secretary
has discretion to accept less than perfect compliance. Thus,
the
program instruction is not a mandate that states comply in 80% of
their
cases, but indicates only that, even if a state has failed to
actually
meet the statutory requirements in all cases, OHDS may still find
the
state's operation to be satisfactory.
* There is some case authority holding that an agency statement
regarding
what policy it intends to apply in adjudicating(11) issues on
a case-by-case
basis is an exempted "general statement of policy" and
not a rule. See,
e.g., Pacific Gas & Electric Co. v. FPC, 506 F. 2d 33
(D.C.Cir.
1974). The program instruction can be read as merely stating
what
position OHDS will take in adjudications enforcing section 427, and
thus,
considered a general statement of policy rather than a rule.
The case of Morton v. Ruiz, relied on by the State, held that
an
interpretation in an agency manual should have been published because
it
effected "individual substantive rights and obligations"
regarding
eligibility for benefits. Several other cases suggest that, even if
the
APA does not apply, elementary fairness may require use of notice
and
comment rulemaking where an agency issuance has substantial
impact.
There is some question of the viability of this proposition after
the
Supreme Court decision in Vermont Yankee Nuclear Power Corp. v.
Natural
Resources Defense Council, Inc., 435 U.S. 519 (1978), which
contains
dictum to the effect that courts cannot require agencies to
follow
procedures not mandated by the APA. See, generally, K.
Davis,
Administrative Law Treatise, Chapter 7 (1979 and 1982 Supp.). In
any
event, we think that the situation here is distinguishable from that
in
Morton v. Ruiz, and the other cases, where the policies at issue
had
future effect on the right or obligations of the public to which
they
were addressed. The program instruction does not have the kind
of
substantial impact referred to. The State provided evidence that
loss
of the section 427 funds would negatively affect the foster care
system
in Maryland, implying of course that it was the foster care children
who
would suffer. This result flows from section 427 itself, however,
which
governs what States must do to be entitled to additional funds and
from
the State's own actions in failing to operate its system
satisfactorily.
The program instruction merely provides guidance for the
regional office
to determine how a state has performed in past years under
that section,
leaving discretion to the central office to determine whether
that
performance is unsatisfactory.
We also note that the record shows that state representatives
were
provided an opportunity to comment on the compliance review
process
before the program instruction was issued. Resp. to
interrogatories,
Tab EE. Thus, at least some notice was given to states
about what the
agency intended to do, with an opportunity for input.
Therefore, we conclude that the OHDS decision should not be overturned
on
the basis that the program instruction was not promulgated through
notice and
comment rulemaking.(12)
C. Whether the decision here is inconsistent with the
Assistant
Secretary's letter.
As part of the dialogue between states and HHS concerning section
427
reviews, a representative of the National Council of State
Public
Welfare Administrators (NCSPWA) wrote the Secretary requesting a
meeting
about three recommendations regarding section 427 reviews adopted by
the
NCSPWA at a meeting held on September 21, 1983. Resp.
to
interrogatories, Tab A. On December 1, 1983, the Assistant
Secretary
for Human Development Services met with NCSPWA and, at the request
of
the Secretary, the Assistant Secretary provided a written response
to
the NCSPWA concerns in a letter dated December 13, 1983. Id, Tab
V.
After reviewing the history of the section 427 regulatory process,
this
letter referred to meetings between officials of ACYF and the NCSPWA
and
the Assistant Secretary's understanding that "the resulting
general
consensus was that ACYF would base the compliance reviews on
reasonable
State interpretations of the statute." Id., p. 2. The letter
then
continued:
However, in conducting the reviews, we found that the statute
was not
sufficiently clear in all its aspects. The statutory
requirements are
complex, detailed, time-specific and scattered throughout
both title
IV-E and title IV-B of the Act. In addition, there was
often
disagreement on what constituted a reasonable interpretation.
Given the
complexities of this statute, it became clear that it was not
possible
to conduct reviews without some basic agreement on minimum
requirements.
Therefore, as you know, we are developing an NPRM which pulls
together
in one place all the requirements - the cross-references between the
two
laws and the pertinent regulatory requirements. It also includes
the
criteria, percentage levels and standards with which we believe a
State
must comply to reasonably meet statutory provisions.
Id., p. 2.
The State relied on this statement for its argument that OHDS had a
policy
"disavowing" its own compliance review process and that the
decision here was
inconsistent with that policy. The State pointed out
that the Assistant
Secretary was acting for the Secretary in responding
to the NCSPWA letter,
and that many agency officials participated in
drafting the letter, including
some responsible for policy development.
Essentially, the State would read
the statement that "it was not
possible to conduct reviews without some basic
agreement on minimum
requirements" as a policy not to take any action based
on the compliance
review process which had been developed.(13)
We do not think that this reading is warranted under the circunstances.
In
context, the statement is simply meant as an explanation of why the
Agency
had decided to issue regulations on section 427 as suggested by
the
states. To read it as a policy of not requiring any return of funds
as
a result of the existing review process is to suggest that the Agency
would
wholly abdicate its responsibility to ensure that funds went only
to eligible
states. While the letter acknowledges that the statute is
"not
sufficiently clear in all its aspects," this implies that some
aspects of the
statute are clear and there is no reason why these
aspects cannot be
enforced. In addition, we note that the NCSPWA letter
suggested that no
"fiscal sanctions" be taken until new regulations were
issued; nothing
in the Assistant Secretary's letter were intended to be
a formal policy
"disavowing the compliance review process" (in spite of
its format as an
informal letter directed to one person rather than all
states), we see no
reason why the Agency would be precluded from
changing that policy. Since the
Assistant Secretary's letter was not
issued until after the fiscal years in
question here, the State could
not reasonably allege (and, indeed, did not
allege) that it had relied
on the supposed policy in certifying compliance or
operating its system.
Therefore, we conclude that the Agency's decision here is not barred
by
the Assistant Secretary's December 13, 1983 letter.
Having concluded the compliance review process is valid, and
consistent
with the statute and OHDS policy, we next turn to the specific
case
findings and the issue of whether the State reasonably interpreted
the
periodic review requirement.
II. Analysis of issues regarding periodic reviews.
A. Whether the State reasonably interpreted the periodic
review
requirement.
What we must decide.
As noted above, OHDS did not publish final regulations to
implement
section 427 until May 1983. The record shows that, in the
absence of
regulations, OHDS agreed with the states that a state's
certification of
compliance with section 427 could be based on the state's
reasonable
interpretation of the statutory provisions. This agreement
is referred
to in a report by the American Public Welfare Association on
section 427
compliance reviews and confirmed in the Assistant Secretary's
December
1983 letter discussed above. Resp. to interrogatories, Tabs A,
EE,(14)
and V. Thus, in the facts of this case, the issue before us is
not what
is the best interpretation of the statute, nor whether the
Agency's
interpretation is or is not reasonable. Rather, we must decide
whether
the State's interpretation is reasonable and permitted by the
statute.
If it is, then by the terms of OHDS's own guidance, the
State's
interpretation should be followed. We conclude below that
Maryland's
interpretation, while not the only one, was a reasonable one for
the
period involved here.
We also observe that, as a policy matter, it may be preferable that
all
children in foster care, no matter what their status, be
monitored
periodically. The question here, however, is not whether some
review is
appropriate, but whether a review of the type and frequency
prescribed
in section 475(5)(B) was clearly intended to apply to children
in
adoptive or other permanent placements. Neither the statute nor
the
legislative history specifically addresses this question. Below,
we
examine the wording of section 475(5)(B) and state why we think
the
State's interpretation was a permissible one when it was developed.
We
then address the arguments raised by OHDS, explaining why we do not
find
them persuasive.
The staturoty language.
The requirement for a "periodic review" appears in section 475(5)(B)
as
part of the definition of a case review system. Specifically, such
a
system must include a procedure for assuring that--
the status of each child is reviewed periodically but no
less
frequently than once every six months by either a court or
by
administrative review (as defined in paragraph (6)) in order
to
determine the continuing necessity for and appropriateness of
the
placement, the extent of compliance with the case plan, and the
extent
of progress which has been made toward alleviating or mitigating
the
causes necessitating placement in foster care, and to project a
likely
date by which the child may be returned to the home or placed
for
adoption or legal guardianship, . . .
Section 475(6) states:
The term "administrative review" means a review open to
the
participation of the parents of the child, conducted by a panel
of
appropriate persons at least one of whom is not responsible for the
case
management of, or the delivery of services to, either the child or
the
parents who are the subject of the review. (15)
Essentially, the State's position is that the four matters which are
the
subject of the periodic review speak to a state's progress in placing
a
child with his or her permanent family and that these matters
have
already been resolved for the child in a permanent placement.
Maryland
argued that the legislative history of the Child Welfare and
Adoption
Assistance Act of 1980 shows that Congress intended to encourage
a
foster care system which attempts to prevent the removal of
children
from their homes, to reunify children in foster care with their
families
if possible, and to place children in permanent placements
when
reunification is not possible. State's supplemental brief, p.
6. Thus,
Maryland said, for children living with their permanent
families, the
goal of the statute has been achieved.
We do not agree with the State that the only statutory goal
is
permanency; as we discuss below, there are some elements of a case
plan
which are intended to ensure that the care and services the
child
receives in the foster care placement are proper. However, the
language
and legislative history of the statute do support the proposition
that
the primary thrust of the periodic review requirement was to
encourage
permanency planning for foster care children. Moreover, the
wording of
the periodic review requireement, and the definition of
an
administrative review, indicate that Congress contemplated a
review
where all of the possible alternatives (including reunification with
the
child's parents) would be considered. The reviewers are to
determine
whether foster care placement continues to be necessary and to
evaluate
whether sufficient progress has been made in addressing the causes
for
removal to permit the child to return home. /6/ The review, if by
an
administrative body, must be open to the parents, who are the
"subject
of" the review.
The statute lists the four matters to be considered in the
conjunctive
and nowhere indicates that these matters are to be considered
only as
appropriate to an individual child. Indeed, OHDS itself adopted
wording
in the original proposed regulations(16) on Section 475(5) which
would
have provided that a periodic review "shall include" all four
elements.
45 Fed. Reg. 86836. Thus, we think that the State could have
reasonably
concluded that Congress contemplated a six-month periodic review
only in
those situations where no permanency had as yet been achieved.
A review
of the particular type described in the statute and proposed
regulation
would be essentially meaningless where the primary matters to
be
considered have already been finally determined and there is no
reason
to reopen them.
OHDS position.
OHDS advanced two basic reasons why it considered the
State's
interpretation unreasonable, and also argued that the State had
notice
of the OHDS interpretation that periodic reviews had to be
performed
irrespective of whether a child was already in a permanent
placement.
First, OHDS pointed to the language in section 475(5) (and in
section
427) referring to "each child," arguing that this made it clear
that
even children in permanent placements needed periodic reviews. We
think
the State could have reasonably read this as meaning each child for
whom
the goal of permanency has not already been met. Moreover, the
Agency
itself interprets the dispositional hearing requirement, which
contains
the same wording, as permitting an exception for children placed in
a
home for adoption or in a court-sanctioned permanent placement.
PI
82-06; 48 Fed. Reg. 23108. OHDS argued that the purposes of
the
dispositional hearing differ from those of the periodic
review,
explaining why OHDS determined to exempt some children from
the
dispositional hearing requirement but not from the periodic
review
requirement. We agree with OHDS that, simply because OHDS
exempted
certain children from the one requirement does not compel it to
exempt
those children from a different requirement. /7/ The key point
here,
however, is that OHDS has itself interpreted the statute to
permit
exemption, in spite of the wording referring to "each child."
When this inconsistency was pointed out to OHDS, it then took
the
position that periodic reviews are required for children in
permanent
placements because one of the purposes of the periodic review is
to
determine compliance with the case plan and the case plan should
include
matters relating to the child's needs in the foster care
placement.
While this reasoning supports the OHDS(17) interpretation of the
statute
as reasonable, we do not think it renders the State's
interpretation
unreasonable. OHDS did not argue that it would expect a
state to
conduct the same type of review for a child in a permanent placement
as
for a child whose status had not yet been determined with
relative
finality, but merely that a limited aspect of the review would
continue
to be appropriate.
As indicated above, the State could have reasonably concluded that
a
review so much narrower in scope was simply a different type of
review
than that contemplated by section 475(5) (B). Moreover, while
we
recognize that it is important to monitor the quality of care the
child
is receiving, even in a permanent placement, this can be
accomplished
without holding a review of the type and frequency demanded by
the
statute. Maryland has a requirement for review of children in
permanent
foster care every 12 months, and presented uncontradicted testimony
that
too frequent review of the child in a permanent placement could
be
detrimental to the child, representing intrusion by the State
agency
disruptive to the normal family life of the child. In light of
this, we
cannot say that Maryland should have known that, simply because
one
limited aspect of the "periodic review" would still be relevant for
a
child, the requirement as a whole applied.
We are also not persuaded that Maryland had adequate and timely
notice
that OHDS interpreted the periodic review requirement as applying to
all
children in foster care, even those in permanent placements. OHDS
did
not point to any document interpreting the requirement issued
before
Maryland certified compliance with section 427. Rather, OHDS
relied on
Program Interpretation Question (PIQ) 81-1, dated October 20, 1981
and
sent to Maryland by letter dated November 17, 1981, and on PI
82-06,
referred to above. PIQ 81-1 indicates that periodic reviews
are
required for a child who has signed a "long-term placement agreement"
(a
situation which we agree does not have sufficient permanency). PIQ
81-1
does not specifically address children in placements such as
adoptive
placements and permanent foster care which the State said were
involved
here.
PI 82-06 does specifically state that periodic reviews must be held
every
six months for children in adoptive and other permanent
placements,
distinguishing the periodic review requirement from the
dispositional hearing
requirement as the Agency did in its May 1983
regulations. But PI 82-06
was issued in June 1982 to regional officals,
not directly to the states, and
OHDS presented no evidence to show when
Maryland was given notice of this
issuance. As noted above, a party
cannot be adversely affected by an
unpublished agency issuance of which
the party does not have timely,(18)
actual notice. 5 U.S.C. 552(a).
Moreover, these issuances provide
further support for Maryland's
position that, in spite of the statutory
reference to "each child,"
questions arose, among those responsible for
administering the program
requirements, concerning whether those requirements
applied in
situations where a degree of permanency had already been
achieved.
We also reject the argument by OHDS that the record shows that
Maryland
itself interpreted the periodic review requirement to apply to
children
in permanent placements. None of the materials relied on by
OHDS
directly addresses the issue here, as an official State
interpretation
of the section 475(5) requirement.
Finally, we disagree with OHDS that this case is controlled by
our
decision in Wyoming Department of Health and Social Services,
Decision
No. 554, July 23, 1984, where we held that the periodic
review
requirement was sufficiently clear on its face to apply against
Wyoming.
The particular aspect of the requirement at issue there was the
timing
of when the reviews are due and the statute specifies "no
less
frequently than once every six months." Section 475(5). Here, we
hold
that the State reasonably interpreted the requirement to not apply
to
children in permanent placements.
B. Whether the cases here involved permanent placements.
The State contested the Agency's findings on the periodic
review
requirement for eight cases included in the case record survey for
FY
1982. The State argued that each case concerned a child in a
permanent
placement. Since we have determined that the State
reasonably
interpreted the periodic review requirement as not applying to
children
in permanent placements, we must now consider whether in the eight
cases
at issue the children were in fact in involved permanent
placements.
The Agency agreed that three of the cases involved permanent
placements.
Stipulation Regarding Individual Cases, July 17, 1985. For
the reasons
discussed below, we find that none of the remaining five cases
involved
permanent placements at the time that the periodic review was due,
so
that the State's failure to perform the periodic review in those
case
renders them unacceptable. As noted previously, a determination
that
even one of the eight cases involved a permanent placement would
require
the Agency to continue the case record survey. Thus, in determining
how
many additional cases to review, the Agency should count the three
cases
in which there were permanent placements as having passed the
review.
General definition.
Although the determination of whether a child is in a permanent
placement
must be done on an ad hoc basis, looking at the specific $19)
facts of each
case, certain criteria must clearly be met in order for a
case to be properly
considered as involving a permanent placement. The
State defined a
permanent placement as "a living arrangement which is
intended to be the
permanent home, permanent living arrangement for that
child until the child
reaches the age of majority." State's post-hearing
br., p. 16 (citing
testimony at hearing). The Agency did not offer a
different definition
although the Board asked both parties to define the
term "permanent
placement." We think that the State's definition is
generally a reasonable
one consistent with the statute and regulations.
Although the periodic review
requirement at section 475(5) (B) of the
Act provides that the purpose of
that review is in part "to project a
likely date by which the child may be
returned to the home or placed for
adoption or legal guardianship . . .,"
this does not in our view compel
a finding that a permanent placement occurs
only when a child is placed
for adoption or legal guardianship. The
section refers elsewhere to
facilitating "permanent placement," and the
proposed and final
regulations promulgated by the Agency clearly indicate
that the Agency
viewed other placements in addition to adoption or legal
guardianship as
satisfying the statutory goal.
Moreover, the three cases which the Agency agreed involved
permanent
placements all involved placements other than adoption or
legal
guardianship. Specifically, Case #9 involved a child placed by
court
order in long-term care short of adoption. Supp. R., Tab.
2. Case #22
involved a child for whom there was a written permanent
foster care
agreement signed by the child, the foster parents, and a
representative
of the Department of Social Services Supp. R., Tab 6.
Case #29 involved
a child for whom there was a court order granting a
petition for
permanent foster care. Supp. R., Tab 8.
The State presented testimony from social workers experienced
in
permanency planning to support its definition of permanent
placement,
and we have no basis to reject that definition as a general guide
in
examining the individual cases her. In applying that definition in
the
individual case, however, we determined that the State had ignored
the
following factors which we consider critical in deciding whether
the
State properly exempted these cases from the periodic
review
requirement:
* The fact that the child's placement ultimately became permanent for
the
child is irrelevant; the key question must be whether permanency
had
been achieved for the child at the time the periodic review was due.
Much of
the testimony by the State's witnesses is flawed (in spite of
the fact that
the witnesses had training and experience in permanency
planning) because the
witnesses concluded (20) that the children were in
permanent placements based
on events that occurred after the periodic
review was due. /8/
* The general definition does not take into account the question of
who
must intend that the placement be permanent. The statute
contemplates
that all interested parties participate in the decisionmaking
regarding
permanent placement, and the State's own testimony indicated the
need
for agreement or court order, particularly if parental rights have
not
been terminated. Thus, we do not consider a placement
sufficiently
permanent in the absence of a court order if there is not at
least
substantial agreement by all parties who continue to have rights or
are
involved in the placement decision.
* The question of permanency is not just a matter of the child's
living
arrangement but, as the language of section 475(5) indicates, is
a
question of status. The Permanency Planning Form used by the State
(and
included in a number of the case records here) distinguishes
between
living arrangement and legal status of the child. Moreover, the
State's
own testimony (and issuances) indicate that the various options
for
permananecy planning are ranked according to the firmness of the
legal
status of the child in the home. TR I, pp. 36, 113;
State's
post-hearing br., notes 10 and 12. Thus, even if every party
agrees
that the child should remain in a particular home, we do not
consider
that the permanent goal for the child has been achieved if the
record
indicates a conflict regarding what the legal status of the child
in
that home should be.
Below, we address the individual cases where the State relied on
the
testimony of its witnesses for the proposition that the child was in
a
permanent placement. We then address an argument made by the State
in
its post-hearing brief, based on testimony by an OHDS witness, that
two
of the cases could also be considered exempt from the periodic
review
requirement on the basis that the child was in his own home.(21)
The five cases.$% Case #7:
Maryland's witness testified regarding this case: "This is a child
who
is a permanent placement because it's an adoptive placement. He
was
placed with these foster parents when he was less than 2 months old
and
he's remained in that placement throughout his life until he was
adopted
and beyond." TR I, p. 94. The witness further testified: "This
child
was placed as a very young infant. He had guardianship obtained
for him
early on; he was planned to be adopted by his foster parents
and, in
fact, was adopted by his foster parents."
As noted above, the key factor missing in this testimony is the answer
to
the question of when this placement could be considered permanent for
the
child. Certainly, the simple facts that the child was placed at a
young
age and was ultimately adopted by his foster parents are not
sufficient as a
basis for determining that Maryland could reasonably
have determined that
this child did not need a periodic review at the
time it was due.
The record shows that a review was due on December 31, 1981. The
record
does not show any mention of adoption until the social worker
noted
after a home visit on January 27, 1982 (which would have been prior
to
the expiration of the 30-day grace period) that the foster mother
"asked
if she and her husband could adopt (the child) when he becomes
legally
free." Supp. R., p. 4. We think that this would be insufficient
as a
basis for considering this an adoptive placement for several
reasons.
The natural mother did not release her rights until May 1982,
after
which the court granted the State Guardianship with the Right to
Consent
to Adoption and/or Long Term Care in August 1982. Moreover,
there is
evidence in the record that the State agency did not consider the
child
to be in an adoptive placement as late as September 1982. As
of
September 10, 1982, a list of objectives needed to implement the
child's
case plan indicated that further steps to be taken included
approving
the home and approving the adoptive placement. A further
report, signed
by the social worker's supervisor on September 20, 1982,
states that the
child "will require foster care until adoptive placement can
be made."
Supp. R., p. 10.
Thus, at the time the periodic review was due, there was still
the
possibility that the child could have been returned to his
natural
mother or that the State agency would not approve adoption by the
foster
parents. The goal of permanency had not yet been
achieved.(22)
Case #11:$% This child was abandoned by his mother and placed in
the
custody of his maternal grandmother by court order in 1968. The
county
department of social services did not have supervision over the
child
until the court ordered this in March 1981, because the
child's
stepbrother and stepsister had been in trouble with the law and
there
was some question about whether the grandmother was
adequately
supervising the children. By this time, the child's mother had
died and
the whereabouts of his father were unknown. OHDS accepted a
"status
report" to the court on December 22, 1981, as a timely periodic
review
but found that the next review was not held until the "status report"
on
July 29, 1982, and that this review was not timely because the
review
was due June 22 (or July 22 with the 30-day grace period).
The State's witness testified that this child was in a
permanent
placement, giving the following reasons: "The child had been
living
with his grandmother since he was 2 years old. The court had
approved
the placement; in fact, the court reaffirmed the placement
when it
reviewed it again in 1981 and finally, the final court review
in
September 1982, the court rescinded the local department's
supervision
and gave guardianship to the grandmother or reaffirmed
guardianship." TR
I, p. 94. This witness also testified that, in her
opinion, the
September 1982 order was a "renewal of guardianship" although
she
acknowledged that there was some lack of clarity about this in
the
record. TR I, pp. 90-92.
The only support in the record for the conclusion that the
grandmother
already had guardianship is a reference in the December 1981
status
report that "his grandmother has guardianship of him in the
Circuit
Court." Supp. R., p. 68. The "periodic reassessment" sheet
prepared by
the same social worker and supervisor in July 1982 notes,
however, that
"his grandmother has only custody, not guardianship." Id., p.
60.
Moreover, the order of the Juvenile court in September 1982,
while
somewhat ambiguously noting that the purpose of the proceedings
was
"REVIEW/GUARDIANSHIP," states that the court has determined that
it
would be in the child's best interest to appoint the
grandmother
guardian and orders that the grandmother is "hereby APPOINTED
GUARDIAN"
and that the clerk of the court "include this case in a separate
index
of juvenile cases in which guardians have been appointed." Id., p.
71.
This wording is inconsistent with the view that the grandmother
already
was the child's guardian, and we therefore cannot give credence to
the
opinion of the State's witness. /9/
(23)
Furthermore, the record does not show that all parties agreed to
a
permanent plan for the child prior to the time the review was due.
The
State correctly noted that there was no plan to remove the child
from
the grandmother's home, but the circumstances under which the court
in
March 1981 committed the child to the supervision of the
county
department indicate that the court had some question about whether
that
placement was in the chilkd's best interest. Moreover, the legal
status
of the child was not agreed upon at the time the periodic review
was
due. The December 1981 status report commended that the child
remain
committed to the county department although the November 1981 notes
by
the social worker indicate that the grandmother wanted this
commitment
rescinded. The forms prepared by the social worker in July
1982
indicate a permanent living arrangement with the grandmother but
with
the grandmother simply having custody. Id., p. 68. There is
no
indication that the child (who at this point was about age 15) agreed
to
this and elsewhere the record notes that the child would like to
locate
his father. The supervisor signed the social worker's forms on
July 29,
1982, but on the same date, the supervisor and social worker signed
a
status report recommending to the court that the child's commitment
to
the county department be rescinded and guardianship of the person
and
property be given to the maternal grandmother. (It also appears
that
the supervisor may have questioned in November 1981 whether
guardianship
was appropriate but these notes are not completely legible.) The
record
thus indicates that only the social worker determined that mere
custody
was appropriate; this goal was altered by the supervisor and
court who
determined that the grandmother should have guardianship.
This is a
significant difference, not only because the legal status differs,
but
because federal foster care payments would no longer be available
for
the child after he was removed from the State's supervision. Thus,
we
conclude that the State could not have reasonably concluded
that
permanency had been achieved at the time the review was due.
Case #14:$% When this child was an infant, she was abandoned by her
mother
and placed with her "grandmother," that is, the mother of her
putative father
(later established as her natural father). The father
later began
living with his mother and, when he (or his parents) sought
to adopt the
child in 1979, the court ordered that joint custody be
given to the father
and the grandmother. The court further ordered that
"the prayer for
adoption . . . be HELD IN ABEYANCE until such time as
this matter is again
considered by the Court . . ." Supp. R., p. 74.
The court also ordered that
homemaker services be provided and the
record shows there was some question
about the grandmother's
housekeeping habits. In 1980, a caseworker
noted that the placement was
"currently satisfactory. Id., p. 76.
A (24) different caseworker made
a home visit in August 1981, but neither she
nor her supervisor signed
the report. This report noted (as had earlier
reports) that the child's
mother sometimes visited the home. Supp. R.,
p. 78.
OHDS found that a periodic review was due for this child in
September
1981. The State alleged that a "reconsideration" was done on
December
7, 1981, but provided no evidence of this. In any event, no
review was
held in calendar year 1982 prior to November 1982 when a court
rescinded
the child's commitment to the State since the child was living in
the
same home as her father.
The State's witness testified that the child was in a permanent
placement
because: "She was placed with her grandmother; there were
no
plans to ever remove the child; all parties verbally agreed this was
to
be the plan for the child -- the mother, the father, grandmother,
the
agency, everyone agreed and then there was the court order of May
1979
in which the court ordered the child be in the custody of
the
grandmother and the father." TR I, pp. 48-49.
The case record simply does not support this. Although
various
caseworkers noted that the mother was incapable of caring for her
child,
there is no evidence that she actually agreed to the child's
placement
nor that her parental rights were ever terminated. Several
reports note
grave concern with the grandmother's housekeeping, and one notes
that
approval of the adoption request would have been more consistent
with
the concept of permanency (the State said that the court's order
denying
adoption was in response to the father's request to adopt, but
the
record also indicates that the grandparents had sought to adopt
the
child). There is no indication that the State had a permanent plan
for
the child until the time the request was made in July 1982 to
rescind
the child's commitment. Moreover, we do not consider the 1979
court
order to have determined the child's legal status since it held
in
abeyance the question of the child's adoption.
Thus, we find that this child was not in a permanent placement at the
time
the periodic review was due.
Case #24:$% The State's witness testified regarding this child: "He
was
in a permanent placement because he was placed in this home at 5 days
of
age, he remained in this home, there were no plans to ever remove
the
child, the agency held guardianship on this child, and there was
a
signed permanent foster care agreement." TR I, p. 41. (25) Again,
the
difficulty with the State's evaluation is that it fails to consider
the
element of timing. OHDS found that the periodic review was due
in
November 1981 and that none was held until March 24, 1982. The
signed
agreement to which the witness referred is a service agreement which
is
undated but which the record shows would not have been entered
into
prior to December 1982. The "reconsideration" report prepared
in
January 1981 and signed by the worker's supervisor in February
1981
indicates that the plan for the child was that he be adopted by
his
foster mother "as soon as the home study is completed." Supp. R.,
pp.
98-101. The next three reports indicate that steps had been taken
in
the adoption process, but a December 1982 report indicates that
the
foster mother had changed her mind and was refusing to adopt the
child,
even though she had had him for 16 years at that point. The
service
agreement states that the child understands and agrees that "my
foster
mother . . . was studied and approved by the Agency to adopt me (and)
it
is (her) decision alone not to finalize the adoption."Id., p. 107.
Thus,
the service agreement was obviously not in effect at the time
the
periodic review was due and does not provide a basis for
determining
that the child was in a permanent placement at that time.
/10/
Case #27:
The State's witness testified about this child: "He was in a
permanent
placement because he was placed here directly from the hospital
where he
was born. He had never moved from the placement. The
plan was to adopt
and there was steady movement toward that adoption
throughout the life
of the case." TR I, p. 103.
OHDS found and the State did not deny that the periodic review was
due
September 30, 1981, but was not held until May 11, 1982, and that
a
dispositional hearing was due December 31, 1981, but was not held
until
March 9, 1982. We do not think that the child was in a
permanent
placement at the time the review and the hearing were due, since
the
parental rights were not terminated until March 9, 1982, when the
court
granted the local department guardianship with the right to consent
to
adoption. Although the natural mother had voluntarily relinquished
the
child for adoption, the mother broke many appointments when the
social
worker requested that she surrender her rights or discuss planning
for
the child, and it appears that the mother would have been capable
of
caring for the child. Supp. R., p. 128. Moreover, a
Permanency
Planning Form indicates that the adoption plan was established
"12/81"
after the review was due.Id., p. 127.
Were two case acceptable because the children were "at home"
At the hearing, Maryland questioned one of the Agency's
witnesses
concerning whether periodic reviews were required for children
living at
home and whether two of the children (Case #11 and Case #14) were
in
fact living at home. In post-hearing briefing, the State then
argued
that the Agency had conceded that periodic reviews were not required
for
children living at home and that Cases #11 and #14 fit this
description.
Specifically, the State relied on testimony by the Chief of the
Financial
Operations Review Branch, Office of Management Services, OHDS,
who
testified: "Any child who is returned to its parents has met
the
purposes of everything, the child has been reunified. So once the
child
is back home, there is no need for a periodic review." TR II, p.
55;
see also TR II, pp. 79, 110. This witness also made statements
that
implied that Case #11 and Case #14 could be considered children
"at
home" since they were in their grandmothers' homes. TR II,
pp. 91-92;
110.
We conclude that, while it is correct that a periodic review is
not
required for a child returned to his own home, the witness's
testimony
is not an admission that these children had, in fact, been returned
home
within the meaning of the statute, nor do we think the other evidence
in
the record establishes this. /11/
In discussing the goals of the periodic review and other section
427
requirements, the statute and regulations do indicate that a
possible
permanent option for a child is a "return home". The meaning
of this,
however, is established through references to "reunification of
the
child with his parents." Considering the statutory provisions as
a
whole, we think that, when the statute refers to a "return home" as
an
option in permanency planning, it means a return to the parents'
home.
Since we recognize that foster care under title IV-E is
available
generally for a child removed from home as a result of a
judicial
determination or voluntary agreement, and it is possible that the
home
from which a child is removed might be the home of a relative, such as
a
(27) grandmother, the statute could arguably be read as meaning a
return
to a grandmother's home if that was the home from which the child
was
removed when placed in foster care. But this is not the
situation
present here.
The record shows that both of the children at issue here had resided
with
their grandmothers since shortly after birth, so, in one sense, the
child was
"at home." We think this is what the witness meant when he
said that the
child was at home "according to common terminology." TR
II, p. 91. Both
of these children had been placed with their
grandmothers so that the
grandmothers could provide foster care, as
their mothers could not provide
for them. Since the State continued to
make foster care payments for
these children while they were placed with
their grandmothers, however, we do
not think that the permanency goal of
being "returned home" can reasonably be
considered met for these
children at the time the reviews were due.
Thus, we do not agree with the State that the findings for these
children
should be reversed based on the testimony that they were "at
home."
Conclusion
For the reasons stated above, we uphold the OHDS compliance review
process
in general, but reverse the findings in three FY 1982 cases. We
remand to
OHDS to continue the FY 1982 review. If the State is
ultimately found
ineligible for FY 1982 funds, the State may return to
the Board. If the
Board upholds a determination that the State is
ineligible for FY 1982 funds,
the Board will then address the case
findings for FY 1983, based on the
record already developed.
/1/
Additional funds available
under section 427 are a proportional
share of the amount appropriated for
title IV-B which exceeds $$
transfer funds from title IV-E of the Act to
title IV-B. Section 474(
c) of the Act. Here, the $1,296,770 for
FY 1982 consists of $251,573 as
Maryland's share of section 427 funds plus
$1,045,197 in transferred
funds; the $2,041,746 for FY 1983 consists
of$$250,335 in section 427
funds plus $1,791,421 in transferred
funds. /2/ We use
the
following abbreviations in citing the record in this case:
Transcript
of hearing, July 23, 1985 (TR I); Transcript of hearing,
July 24, 1985
(TR II); Agency's Attachments to Response to Maryland's
Interrogatories
(Resp. to interrogatories); Appellant's Consolidated
Post-Hearing Brief
(State's post-hearing br.); Appellant's Supplemental
Record on Appeal
in Docket No. 84-33 (Supp. R.). /3/ The State
submitted proposed
findings and conclusions of law with its post-hearing
brief. We
considered all of these proposals, as well as the parties'
arguments.
To the extent that they accord with the findings and conclusions
in our
decision, they have been accepted. To the extent that they
are
inconsistent with our decision, they are rejected. Certain
proposed
findings and conclusions have been omitted as not relevant or as
not
necessary to a proper determination of the issues
here. /4/ We
also note that 5
U.S.C. 553(a)(2) exempts matters relating to grants.
This exemption would
clearly apply to section 427 funds but for a
Federal Register notice adopting
section 553 procedures for HHS (then
HEW) grant programs. 36 Fed. Reg.
2532 (Fed. 5, 1971). Courts have
held that this notice constituted a
waiver of the exemption. Herron v.
Heckler, 576 F. Supp. 218, 229
(N.D.Cal. 1983); National Welfare
Rights Organization v. Mathews,
533 F. 2d 637, 646 (D.C.Cir. 1976); see
also Rodway v. Dep't of
Agriculture, 514 F. 2d 809, 814 (D.C.Cir.1975).
Although HHS published
a notice of proposed rulemaking on June 22, 1982
(47 Fed. Reg. 26860), which
would have modified and clarified the 1971
notice, the proposed rule has
never been issued in final form.
/5/ As discussed below, however,
interpretations of general
applicability are subject to 5 U.S.C. 552, and, if
not published in the
Federal Register, cannot adversely affect a party
without timely,
actual
notice. /6/ The 1980
proposed regulations provided:
"Determining the Continuing Necessity and
Appropriateness of Placement
means an assessment of the conditions in the
child's own home to
determine whether the child should return home." A review
of the foster
care placement and services provided would follow only if the
review of
the home indicated that continued foster care was required.
45 Fed.
Reg. 86836. The statutory definition of "case plan" also
suggests a
situation where return home is still a viable option.
Section 475(1) of
the Act.
/7/ We note, however, that both requirements have the
general purpose of
determining the "status" of the child, so the
difference is not as clear as
OHDS contended. /8/ In
determining
when a review was due in the individual cases, we have used the
dates
found by OHDS and undisputed by the State. OHDS allowed a 30-day
grace
period in its survey and would consider a case acceptable if the
review
was performed within that time period, so we have also taken that
into
consideration in our analysis
below. /9/ We note that
the
State's witnesses did not have independent knowledge of the
disputed
cases but had based their opinions on the written case files.
The Board
declined to accept the complete files into the record here but
indicated
that the parties had the burden to introduce any documents
supporting
their positions. /10/ Since the State did not argue that
this was an
adoptive placement, we
do not reach that issue. /11/
In
any event, we doubt that this witness has the authority to make
an
admission binding on the Agency, particularly since he is a
financial
specialist rather than a policy specialist.
MARCH 28, 1987