Congress must follow a "PAYGO" law (pay-asyou-go) spending limit. PAYGO provides for an across-the-board sequester/cuts of non-exempt mandatory spending programs if lawmakers enact deficit-increasing legislation. If the deficit is increased due to a new law (like the current tax cut proposal) the Office of Management and Budget (OMB) divides the ten-year deficit effect, calculates the amount for each of the ten years. If Congress adjourns without fixing the deficit increases, OMB issues sequester/cuts of non-exempt mandatory programs.

The programs that get cut are all mandatory and entitlement programs that are not protected by the PAYGO law. The big entitlements such as Social Security and some means-tested entitlements (including foster care and adoption assistance) are exempt from these cuts. Medicare is subject to a cut but it is capped at 4 percent. 

The Social Services Block Grant is completely defunded at $1.7 billion and the mandatory part of Promoting Safe and Stable Families (PSSF) is zeroed out leaving only the appropriated side ($59 million) which means 85 percent of the program is eliminated. PSSF funds family preservation, family support, limited reunification and adoption support with states required to allocate at least 20 percent of PSSF funding to each of the areas. In addition, the $20 million for regional drug treatment grants would be zeroed out along with the $20 million for workforce development tied to caseworker visits. Additionally, the cuts would take approximately $20 million out of the Chaffee Independent Living program which is a $140 million mandatory fixed fund under Title IV-E foster care.

Number of children in foster care increases, more children are waiting to be adopted.

On Thursday, November 30, HHS released the latest data on child welfare and it now shows that there are 437,465 children in foster care as of September 30, 2016. This is the fifth straight year of increases going from 396,966 in 2012 to 437,465 in 2016. Likely the 2017 numbers are even higher. That is in sharp contrast to decreases for every year between 1999 through 2012 when foster care numbers decreased from 567,000 to the 2012 total of 397,000.

The number of adoptions are also up to 57,208 (up from 53,556) but so are the number of children waiting to be adopted now at 117,794. That is the highest number of children waiting to be adopted since 2008 when the number was 123,000.

The adoption-kinship incentive fund is out of money for the awards in September 2018 just at the time that children waiting is going up. Annually funded at just under $38 million, the incentive fund (created as part of the Adoption and Safe Families Act) was always fully funded through the last decade because Congress would increase appropriations if there was a shortfall in the previous fiscal year's awards. In recent budgets, HHS has taken the next fiscal year's funds to make sure states were fully reimbursed from past shortfalls in bonuses. HHS has done that so much now that all funding from the FY 2018 (still to be finalized) will be used up to pay for FY 2017 incentives. Congress, instead of making up for the shortfall, has been cutting funding.