Old article but worth the read.
FOSTER CARE FINANCING
The Federal government provides tremendous financial incentives to maintain foster care programs. One Federal program that helps states cover the cost of foster care grew from about $300 million in 1981 to nearly $2.7 billion in 1991.[1]
According to the General Accounting Office, in 1993 nearly $1.3 billion Federal dollars went to foster care maintenance, while an additional $1.1 billion in reimbursements went to states for foster care related administrative activities.[2]
According to the GAO report, while states provide the majority of funds for foster care and child welfare services, by 1995 the Federal share of expenditures for these services reached $4.1 billion.
The Congressional Budget Office estimated the Federal government will spend over $9.2 billion between fiscal year 1991 and 1996 for foster care programs.[3]
In 1995, states received more than $2.8 billion in federal assistance for approximately half of the estimated 494,000 children in foster care.
The Congressional Budget Office estimates that by 2001, federal costs will rise to $4.8 billion with caseloads of federally assisted foster care children increasing by almost 26 percent.[4]
According to an analysis done for TIME Magazine by the Child Welfare League of America, the annual welfare cost of one child living with his or her mother is $2,644, while the average cost for the child's care in residential group care is $36,500.[5]
The best estimates currently available of the total of all annual expenditures on foster care services nationwide is in the range of ten to twelve billion dollars.[6]
These are national averages. For a closer look at how these funds are being disbursed, we turn to the States.
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