Department of Health and Human Services
DEPARTMENTAL APPEALS BOARD
Appellate Division
SUBJECT: Nebraska Department of Social Services
DATE: May 16, 1991
Docket No. 90-210
Decision No. 1250
DECISION
The Nebraska Department of Social Services (Nebraska, State) appealed
a
determination by the Administration for Children and Families
(ACF,
Agency) disallowing $474,140 in federal financial participation
(FFP)
claimed by the State for foster care maintenance payments under
Title
IV-E of the Social Security Act (Act) for federal fiscal year (FY)
1987.
1/
ACF disallowed the maintenance payments because it determined that
the
court orders directing removal of the children did not comply with
the
requirements of the Act. ACF determined that the court orders did
not
contain the findings that 1) continuation of the children in their
homes
was contrary to their welfare and 2) that the State had made
reasonable
efforts to prevent or eliminate the need for removal of the
children
from their homes. ACF also refused to accept nunc pro tunc
(NPT) orders
and other evidence the State submitted as evidence that these
findings
were made.
For the reasons stated below, we uphold the Agency's disallowance.
Relevant Authority and ACF's Interpretations
Under section 472 of the Act, FFP is available in foster care
maintenance
payments for a child removed from the home of a relative
only if, among other
conditions --
the removal from the home . . . was the result of
a
judicial determination to the effect that
continuation
therein would be contrary to the welfare of such
child
and (effective October 1, 1983) that reasonable
efforts
of the type described in section 471(a)(15) have
been
made; . . . .
Section 472(a) of the Act (emphasis added).
Section 471(a)(15) of the Act requires that, effective October 1, 1983,
a
state plan under Title IV-E must provide that --
in each case, reasonable efforts will be made (A)
prior
to the placement of a child in foster care, to
prevent
or eliminate the need for removal of the child from
his
home, . . . .
The requirement for a judicial determination to the effect
that
continuation of the child in the home would be "contrary to the
welfare
of such child" was continued from the foster care program
previously
funded under section 408 of the Act. The "reasonable
efforts"
requirement was added when foster care was restructured under Title
IV-E
through the Adoption Assistance and Child Welfare Act of 1980,
Public
Law 96-272.
The legislative history of Public Law 96-272 makes clear that Congress
was
concerned that children were being removed from their homes
unnecessarily and
placed in foster care. In discussing the requirement
for a judicial
determination, the relevant Senate committee report
described such a
determination as "an important safeguard against
inappropriate [state] agency
action," and noted:
The committee is aware of allegations that the
judicial
determination requirement can become a mere pro
forma
exercise in paper shuffling to obtain Federal
funding.
While this could occur in some instances, the
committee
is unwilling to accept as a general proposition that
the
judiciaries of the States would so lightly treat
a
responsibility placed upon them by Federal statute
for
the protection of children.
Sen. Rep. No. 336, 96th Cong., 1st Sess. 16 (1979). On the
Senate
floor, Senator Cranston described the conference agreement as
follows:
In the past, foster care has often been the first
option
selected when a family is in trouble; the new
provisions
will require States to examine alternatives and
provide,
wherever feasible, home-based services that will
help
keep families together . . . . Of course, State
child
protective agencies will continue to have authority
to
remove immediately children from dangerous
situations,
but where removal can be prevented through the
provision
of home-based services, these agencies will be
required
to provide such services before removing the child
and
turning to foster care.
126 Cong. Rec. 14767 (June 13, 1980).
ACF regulations implementing Public Law 96-272 contained provisions
on
requirements that states provide preplacement preventive services
and
describe in a child's case plan the services offered and provided.
45
C.F.R. Part 1356. The regulations did not elaborate on the
statutory
judicial determination requirement.
In a policy announcement issued on January 13, 1984, however, ACF
did
address questions regarding the requirement for a
judicial
determination. The policy announcement stated that the
judicial
determination must be made "at the time of the removal of a child
from
his home" and explained:
The court, after hearing the evidence, must be
satisfied
that reasonable efforts . . . have been made.
Review
and approval of the [state] agency's report
and
recommendation alone are not sufficient to meet
the
requirements of the Act; the court must make
a
determination that the agency's efforts were, in
the
judgment of the court, reasonable for
preventing
placement.
With regard to emergency situations, if the
agency's
judgment was that services could not have
prevented
removal of the child, the court at the time of
the
adjudicatory hearing must find that the lack
of
preventive efforts was reasonable.
ACYF-PA-84-1, Agency's Ex. 1, unnumbered p. 4. ACF also issued
two
information memoranda, ACYF-IM-87-28 on October 7, 1987
(1987
Information Memorandum) and ACYF-IM-89-08 on April 17, 1989
(1989
Information Memorandum), which discussed the circumstances under
which
ACF would accept NPT court orders as evidence that the
requisite
judicial determinations were made. 2/ Essentially, these
information
memoranda made it clear that such orders would be acceptable only
when
used "to supply, for the record, something that has actually
occurred,
but was omitted from the record through inadvertence or
mistake." 1987
Information Memorandum, State's Ex. 11. Further,
the 1987 Information
Memorandum stated:
Requested documentation may include the transcript
of
court proceedings and/or the agency's report to
the
court, or any other documentation that would
confirm
that the information was actually presented to the
court
at the previous hearing and that the court made
the
determination(s) at that time.
(Emphasis added) State's Ex. 11, p. 2.
The 1989 Information Memorandum expanded upon the
documentation
requirements:
Acceptable documentation that may be requested by
the
Federal agency to make such a verification could
include
court transcripts, bench notes or other court
documents
which, in conjunction with the State agency's
report,
would confirm that the information was presented to
the
court and that the judicial determination(s) had
been
made at the original removal hearing.
Documentation such as post-hearing affidavits is
not
acceptable as verification. The reliability
of
affidavits executed long after a judicial proceeding
is
questionable. These limitations are necessary in
order
to assure children in foster care of the protections
to
which they are entitled under the title IV-E program.
State's Ex. 12, p. 4.
Background
The Agency performed a financial review (Stage I review) of the
State's
Title IV-E foster care system, during the week of June 20,
1988. The
purpose of the review was to determine, with reasonable
assurance,
whether Title IV-E foster care claims for FY 1987 (October 1,
1986
through September 30, 1987) represented payments made on behalf
of
eligible children and to eligible providers at allowable rates.
State's
Ex. 8, p. 1.
As part of the Stage I review, the reviewers read a random sample of
50
Title IV-E foster care eligibility case files associated with Title
IV-E
payments during FY 1987. The Agency determined that nine of the
50
cases (18 percent) could not be accepted as eligible for FFP under
Title
IV-E. The results of the payments reviewed were projected over
the
universe and, based on the point estimate of the average dollars
in
error, extrapolated into the disallowance amount. In seven of the
nine
cases in error, the reviewers based their determination of
ineligibility
on a finding that the case files did not contain documentation
of a
court determination of "reasonable efforts" as required by
sections
471(a)(15) and 472(a)(1) of the Act. In four of these cases,
that was
the sole basis of the ineligibility determination. 3/
Upon completion of the review, the State was given the opportunity
to
provide additional documentation. The State submitted five NPT
orders
and supporting documentation to the Agency. Four of the five NPT
orders
were issued by the same judge, because she had presided over the
initial
hearings. The four NPT orders were all issued on the same day,
June 27,
1988, and, except for relevant names and dates, they were identical
to
each other. Further, the documentation submitted by the State
to
support these orders was essentially the same. In support of each
NPT
order, the State submitted the original court order and numerous
state
reports to the court (for the initial hearings). The fifth NPT
order,
and the only one issued by a different judge, was issued on July
7,
1988. In support of this NPT order, the State submitted a copy of
a
journal entry, a juvenile court petition and an affidavit that
related
to the petition. State's Ex. 2.
ACF determined that the NPT orders and the additional
documentation
submitted did not satisfy the requirements for judicial
determinations
at the time of removal and therefore rejected them. In
its final
report, the Agency maintained that its determination was supported
by
its 1987 Information Memorandum and cited the relevant portions.
The
report also stated:
The State agency's report to the court alone cannot
be
used to verify that such a determination had
actually
taken place at the earlier hearing. Reports to
the
court can only verify that the information was
presented
to the court. They do not verify that it was
considered
by the court or that a determination had been
made.
Affidavits are also unacceptable back-up documentation.
State's Ex. 8, p. 6.
Parties' arguments
The State's primary argument was that the five NPT orders and
supporting
documentation satisfied the existing guidelines of the 1987
Information
Memorandum, concerning the use of NPT orders in establishing that
the
judicial determination requirements of section 472(a)(1) of the Act
had
been met. Further, the State maintained that the restriction noted
in
the Agency's final report, against using only the state's agency
report
to the court as corroborative documentation, was a new provision of
the
1989 Information Memorandum, which was published after the Stage
I
review, and should not be retroactively applied to Nebraska.
Secondarily, the State argued that the Agency could not require the
State
to provide documentation and verification to support a valid,
effective, and
unchallenged court order before the court order would be
recognized by the
federal Agency for financial review purposes.
Nebraska maintained that the
Agency's position is unreasonable for two
reasons. First, by requiring
states to supply contemporaneous court
documents to support the validity of
NPT orders, the Agency is creating
a presumption of possible irregularity or
invalidity of judicial acts
and proceedings contrary to the normally
recognized presumption which
operates in favor of the correctness of judicial
proceedings and
contrary to the legislative intent of Congress as expressed
in the
Adoption Assistance and Child Welfare Act of 1980. Second, the
State
maintained that the courts in Nebraska have adopted and already
operate
under the more narrow interpretation of NPT orders used in the
Agency's
1989 Information Memorandum. 4/
Finally, the State argued that even in circumstances where
supplemental
court documentation may need to be submitted to show the
validity of a
NPT order, the type of such documentation deemed acceptable by
the
Agency pursuant to the Information Memoranda is unduly
restrictive.
Nebraska also noted that the delay between the Stage I review
and the
issuance of the actual disallowance determination, approximately
two
years, is a factor in the amount of available documentation.
The Agency asserted that the NPT orders, some of which were filed
two
years after the orders they purported to cure, were drafted to
"correct
a judicial error involving the merits" or supplied "a
judicial
omission[.]" Consequently, the NPT orders "enlarge[d] the
judgment as
originally rendered[.]" Agency Br., p. 7, citing Larson v.
Bedke, 318
N.W.2d 253, 257 (Neb. 1982). Further, the Agency maintained
that its
1987 Information Memorandum specified the types of information
needed to
support a NPT order. Moreover, the Agency argued that the
1989
Information Memorandum was merely a clarification of the
1987
Information Memorandum. The 1989 Information Memorandum stated
that
some states were using NPT orders "in a widespread,
undifferentiated
manner, primarily to maintain eligibility for federal funds,
rather than
to focus on the assurance of a judicial determination at the time
of
removal as a protection to the child and his family." Finally,
the
Agency maintained that the issuance of NPT orders here was not
in
conformity with state law on the proper use of NPT orders.
Analysis
The issue here is whether the five NPT orders and
supplemental
documentation submitted by the State show that the requisite
judicial
determinations were made for the five children, for whom the FY
1987
foster care payments were made, at the original hearings.
We conclude that the Agency reasonably concluded that the requirements
of
section 472(a)(1) of the Act had not been met. For the period
in
question, the statute provides as an eligibility requirement for
Title
IV-E benefits that the child be removed from the home as a result of
a
judicial determination that continued residence in the home would
be
"contrary to the welfare" of the child and that "reasonable efforts"
of
the type described in section 471(a)(15) of the Act have been
made.
Thus, the child's removal from the home must result from the
judicial
determination on these two issues.
The evidentiary standard applied by ACF is unquestionably consistent
with
the plain wording of the statutory requirement and with the
legislative
history. The original court order at the time of the
child's removal
will obviously be the most persuasive evidence about
whether a determination
was made at that time. In those instances where
the original order does
not refer to the necessary determinations, a
question would reasonably be
raised as to whether the requisite judicial
determinations were in fact
made. Ordinarily, any material finding made
by a court would be
reflected in the court's order issued at the time.
Indeed, the State had a
financial incentive here to inform its judges
that unless they made the
findings required by section 472 and reflected
these findings in their
orders, federal funding would be in jeopardy. 5/
States have attempted to remedy deficiencies in the original orders
with
NPT orders. The Agency, however, has not accepted the NPT orders
as
overcoming the deficiencies in the original orders unless there is
some
corroborative evidence that the determinations were actually made.
6/
We agree with the Agency that serious questions might reasonably
be
raised about NPT orders as evidence of the requisite
determinations.
NPT orders could be issued several years or more after the
original
order and by judges that had not even presided over the case
originally.
Moreover, NPT orders modifying an original court order do not
always
evidence a mistake in the original order in failing to reflect
findings
actually made. Because a NPT may be adding findings not made
at the
time of the original order, the Agency may reasonably require
other
corroborative evidence of an actual determination as required by
the
statute.
After a careful review of all of the documents submitted by the State,
we
find that none corroborates that the necessary findings were in fact
made at
the time of removal of the children. These documents merely
provide
factual background information presumably supplied by child
welfare agencies
or caseworkers concerning the children and their
families. While
conceivably the documents could have served as support
in favor of the
judicial findings required by the statute, they do not,
in and of themselves,
demonstrate that the findings were made.
It is also relevant in our view that while the judges who presided
over
the initial hearings issued the NPT orders, four of the five NPT
orders
were issued on the same day, June 27, 1988, and were identical to
each
other in nature. While this, alone, is not the determinative
factor, it
reasonably raises questions about the NPT orders. Further,
the State
did not provide copies of the petitions that it presented to the
court
to request the NPT orders. Thus, our record does not include all
the
information available to the court when deciding to issue those
orders,
and we are unable to evaluate fully the circumstances under which
they
were issued. Finally, the fifth NPT order, for the case of
B.B.,
appears deficient on its face. Although this case resulted from
an
emergency removal, the NPT order did not state that the State's lack
of
preventive efforts had been reasonable.
Moreover, the State was incorrect when it argued that the Agency's
1987
Information Memorandum notifies states that documentation similar
to
what Nebraska submitted here would be sufficient. While
that
Information Memorandum specifically refers to a child welfare
agency's
report to the court as possible corroborative evidence, it
still
requires that whatever documentation is submitted be sufficient
to
confirm that the court made the requisite determinations prior
to
removal. Thus, a report which by itself did not confirm that the
court
made the requisite determinations would not suffice under
the
Information Memorandum. 7/
Finally, as the Agency argued, the State's issuance of NPT orders
under
the circumstances here does appear to be inconsistent with state
law
concerning NPT orders. Both parties agree that Nebraska state
law
provides that NPT orders --
may not be made to correct a judicial error
involving
the merits, or to enlarge the judgment as
originally
rendered, or to supply a judicial omission or
an
affirmative action which should have been, but was
not,
taken by the court, or to show what the court might
or
should have decided, or intended to decide,
as
distinguished from what it actually did decide.
Larson
v. Bedke, supra.
Further, both agree that the NPT order --
may be supported by the judge's notes, court files,
or
other entries of record. It may also be based
upon
other evidence, oral or written, which is sufficient
to
satisfy the court that the order is required to make
the
record reflect the truth. Id.
While both parties cited Larson v. Bedke, supra, in support of
their
position, that case actually supports the Agency's position in our
view.
That case specifically provides that NPT orders can not be used "to
show
what the court might or should have decided." Further, that case
is
consistent with the Agency's policy of requiring evidence to
corroborate
that the actual determination was made at the time of the
original court
order.
Moreover, we disagree with the State that the Agency's policy
effectively
renders NPT orders invalid. Rather, it simply precludes
accepting those
orders as satisfactorily overcoming defects in an
original order when there
is insufficient corroborative evidence that
requisite findings were actually
made at the time of the original order.
Conclusion
Based on the foregoing, we uphold the disallowance in full.
Judith A. Ballard
Norval D. (John) Settle
Donald F.
Garrett
Presiding Board Member
1. This disallowance was originally issued by the Administration
for
Children, Youth and Families. Effective April 15, 1991, that agency
was
one of several combined into the Administration for Children
and
Families.
2. Literally translated, nunc pro tunc means "now for then."
3. The Title IV-E Foster Care Financial Review is a two-stage
process
based on a statistically valid minimum random sample of at least
200
payment units (cases). Once a state does not pass a Stage I review,
a
Stage II review process, which in this case would require the review
of
the next 250 cases, is usually instituted. However, on August 9,
1990,
the Director of the Nebraska Department of Social Services sent a
letter
(State's Ex. 4) to the Region VII Administrator proposing a
stipulation
that Stage I findings be accepted as those of Stage II as an
alternative
to the Stage II review process, and that a statement of
penalties
incurred as a result of the review be issued, with Nebraska
then
proceeding to appeal the Title IV-E findings. In subsequent
letters,
State's Exs. 5 and 6, the parties further stipulated that Nebraska
would
not appeal either administratively or judicially the reviewer's
sampling
methodology, the calculation of the error rates or the amount of
the
disallowance claim. However, Nebraska specifically reserved the
right
to challenge the methodology or regulation relied on by the Agency
in
determining that the NPT orders and supporting documentation
submitted
to the Agency by Nebraska were insufficient for purposes of the
Title
IV-E review. State's Br., p. 4.
4. The 1989 Information Memorandum noted:
The confusion . . . may be due to the fact there are
two
legal interpretations of nunc pro tunc in ordinary
use
by the courts. In the broader meaning of the term,
the
court may allow for an action to be taken after the
time
it should have been taken, with a retroactive
effect.
The more narrow interpretation allows the court only
to
supply for the record documentation of an action
that
had actually occurred. The narrow interpretation . .
.
is the only acceptable interpretation to satisfy
the
judicial determination requirements in
section
472(a)(1).
5. This was recognized by the State. On March 5, 1984, the
State
issued a procedural directive to its administrative staff which
noted
the necessity for such judicial determinations at the initial
hearing.
The directive stated, in part:
Attached is a format for judges' use . . . and was
sent
as a format which they might want to use or adapt.
If
judges are not addressing the required information
in
their orders, please speak with them about
the
possibility of it being done.
State's Ex. 14, p. 2.
6. We reject Nebraska's argument that the two-year time period
between
the Stage I review and the actual disallowance is a factor in the
amount
of available documentation. Once the review began, the State
was
required to retain relevant records until resolution of all
issues
arising from the review. 45 C.F.R. 74.21(b).
7. Thus, contrary to what the State argued, we find that the
Agency's
policy was not expressed for the first time in the 1989
Information
Memorandum. In any event, as we have already stated, that
policy is
clearly consistent with the plain wording of the statute and
the
legislative