On December 22, 2009, four groups of foster parents and children directly receiving foster care maintenance payments or adoption assistance payments from the Indiana Department of Child Services ("DCS"), filed a law suit against DCS and its director ("Payne") under 42 U.S.C. § 1983in the U.S. District Court for the Southern District of Indiana. The plaintiffs, represented by the ACLU of Indiana and private counsel, asked the court for injunctive relief, alleging that the DCS violated Title IV-E of the Social Security Act, 42 U.S.C. § 670, et seq. Specifically, the plaintiffs asked the District Court to enjoin DCS from implementing a 10% reduction in foster care and adoption assistance payments.
Plaintiffs allege that DCS unlawfully reduced foster care and adoption assistance payments. DCS receives money from the federal government through Title IV-E of the Social Security Act, 42 U.S.C. § 670, et seq., from which monthly payments are made to foster parents and adoptive parents. DCS recently enacted a 10% reduction in these payments, effective in January of 2010. Pursuant to 42 U.S.C. § 673(a)(3), the amount of foster care and adoption assistance payments must be determined by considering the circumstances of the adopting parents and the needs of the child being adopted. Plaintiffs contend that the 10% reduction violated this provision because the reduction was motivated by budgetary constraints and was not the product of any individual assessment of the families receiving the payments or any assessment of the general costs of providing care for the children in question.
On December 22, 2009, plaintiffs moved to certify as a class all foster parents and children directly receiving foster care maintenance payments or adoption assistance payments from DCS. On January 25, 2010, the District Court (Judge Sarah Evans Barker) granted the motion, certifying the claims of C.H. plaintiffs to proceed as a class action.
On December 28, 2010, the Indiana Association of Residential Child Care Agencies ("IARCCA"), the plaintiff in a separate action against DCS seeking to enjoin the 10% payment reduction, made an unopposed motion to consolidate cases. On January 25, 2010, the District Court (Judge Sarah Evans Barker) granted the motion to consolidate the case filed by IARCCA. On January 20, 2010, the District Court (Judge Sarah Evans Barker) issued a preliminary injunction stopping the planned 10% reduction in foster care and adoption assistance payments. DCS appealed this preliminary injunction to the Seventh Circuit Court of Appeals on February 18, 2010. This appeal was dismissed.
On February 9, 2011, the parties executed a settlement agreement. The agreement stipulated that DCS would cease its effort to reduce foster care payments. Further, the agreement required DCS to continue to provide foster care maintenance payments of at least $25 a day until it established a method of computing the costs that satisfied the requirements of 42 U.S.C. § 673(a)(3). DCS was not precluded by the settlement agreement from reducing foster care payments once it had established a new method of computing such payments. The agreement allowed foster parents to challenge the new rates once they were established through the application of the new method of payment calculation. The agreement further provided that DCS pay $104,812 in attorneys' fees and costs.
On February 25, 2011, the District Court (Judge Sarah Evans Barker) approved a Joint Stipulation of Dismissal which dismissed with prejudice the claims made by C.H. against Payne and vacated the Court's Preliminary Injunction. On the same day, the District Court (Judge Sarah Evans Barker) dismissed without prejudice the claim by IARCCA against Payne. The Joint Stipulation of Dismissal provided that the claims made in the Complaint cannot be reopened unless DCS breaches the Settlement Agreement or applicable law before 30 days after the new rates go into effect.Mark Scoville - 03/22/2011