Every week brought new headlines: reconciliation rumors, RIFs, executive actions, pilots paused or announced, workforce shifts, funding cliffs.

If you stay at the surface, it’s disorienting and seems disconnected.

But policy systems don’t move at headline speed; they move when underlying conditions change.

It takes shifts in the architecture of incentives, authority, and capacity to make some ideas thinkable and others impossible. The environment constrains what’s possible.

Think about the difference between a quiet café and a packed bar with live music.

Same people. Same topics. Completely different outcomes. The environment does half the work. Policy works the same way.

Structural conditions shape not just what gets decided, but what gets proposed—by defining the problems we see and the options we consider possible to solve them.

These conditions are constraints. They’re the load-bearing forces that determine what you can add or change, where, and how. They’re the rate limit on reform.

Looking underneath 2025’s noise, three such constraints stand out.

Constraint #1: A Scarcity of Clear Theories of Change

Throughout the year we saw child welfare policy action default to incremental adjustments from existing federal tools rather than from a unified vision.

This happened consistently under the same conditions: momentum from an open window or inciting event, without a coherent theory of change.

Older youth policy made this dynamic especially visible.

Over the course of the year, Congress held two hearings focused on outcomes for youth aging out of foster care.

The Trump Administration elevated the issue with a presidential Executive Orderexplicitly addressing transition-age youth.

The signals were visible, sustained, and cross-branch.

In each case, the ideas that gained traction originated primarily within Washington.

Absent a clear end state goal toward which to work, momentum translated into the apparatus of federal policy; hearings, initiatives, and program adjustments.

That can cohere when all those micro decisions are aligned to a goal. When they aren’t, it becomes the policy equivalent of eating a lot of snacks instead of a meal.

Members of Congress and senior administration officials are generalists by design. Their role is translating competing claims into fundable and governable policy.

Expecting a unitary vision to originate there is a category error; what emerges are predictable expressions of federal power waiting for directional guidance.

Vision must precede structure. Federal tools translate vision; they do not create it.

Family First remains the recent counterexample.

There, a clear, if contested, vision emerged from the field first. Policymakers then did what they do best: negotiate that vision into statutory and regulatory form.

The lesson from 2025 is not that policymakers lacked interest, or that the field lacked ideas. It is that alignment without architecture produces incrementalism by default.

Constraint #2: Fiscal Federalism Is Grinding Along Its Fault Lines

On its face, child welfare financing appeared stable in recent years.

According to Child Trends, agencies spent $34.3 billion in FY 2022, with 57 percent coming from state and local sources—a balance that has remained largely unchanged over the past decade.

That stability, however, masked a longer-term ratcheting effect, since the deeper trend is over decades, and declining.

In recent years, structural pressure in child welfare financing was partially absorbed by temporary or indirect buffers.

Two of the most significant have ended:

• Title IV-E waiver authority, which allowed states to work around outdated eligibility rules and ended in 2019,

• $500 million in Family First Transition Act funding enacted in 2019, running through 2025.

Both smoothed the gap between federal policy design and real system cost.

While this decline trend has proceeded over nearly 30 years, the federal expectations have persisted, ratcheting up the structural tension on financing policy.

At the same time, exogenous pressure on the safety net is intensifying.

Inflation has continued to erode capped funding streams such as TANF and SSBG.

The One Big Beautiful Bill Act will lead to reduced federal spending on Medicaid and SNAP, narrowing supports for families.

Those shifts aren’t specifically within child welfare policy.

But all of them shape who arrives there, with what level of need—and what resources remain available across the balance sheet once they do.

That convergence of expiring buffers and tightening fiscal conditions raises a central question heading into 2026 around how federal policy will adapt long-term.

One direction is renewing investment to be commensurate with the remaining federal policy requirements and expectations.

Another is stepping back, adopting a lighter-touch posture through deregulation.

This is the deeper policy choice and tradeoff underneath many surface arguments.

Constraint #3: State Capacity As Bottleneck

Child welfare has seen real paradigm shifts in recent years.

Kin-first placement. Prevention. Family-based care over congregate settings.

Changing those frames took decades of advocacy, research, and political work. And by comparison, that was the easy part.

Again and again this year, we’ve seen the same pattern:

An idea wins the rhetorical war. It becomes the dominant frame. Federal policy reflects it.

Then progress slows.

Family First is the clearest example. The policy exists. The funding flows exist. The intent is clear.

But implementation hinges on state capacity—the ability to design services, manage contracts, build data systems, train staff, and navigate complex federal rules.

State capacity is the gas tank of reform.

When it’s full, systems move fast. When it’s empty, even good policy stalls.

Yet we rarely measure or even name readiness for reform, leaving the field and the federal government without clear ways to invest in it, assess it, or scale it.

Here’s the tension: just as demand for implementation support is growing, capacity is being squeezed by the same fiscal federalism dynamics described above.

More responsibility. Less slack. Higher expectations.

In 2026, questions about state capacity will move from the background to the foreground.

As pressure mounts and federal investment flattens or declines, federal policy will increasingly feel less like pulling a lever and more like pushing on a string.

Looking Ahead

2026 will bring new dynamics. Midterms will reshape incentives. Administrative priorities will evolve. Some fights will get louder.

But these forces will keep humming in the background, shaping what gets traction long before a vote is taken or a rule is drafted.

At Child Welfare Wonk, we’ll keep tracking these signals.

We’re building you new tools to help you navigate them with clarity instead of whiplash, too.

Because the most important shifts rarely announce themselves.

They just quietly change what we think is possible.

How Child Welfare Advocacy Fell Flat—and What Comes Next

By Zach Laris, Founder & President

It took a Hill staffer’s blunt critique for me to see our field’s challenges and opportunities snap into focus.

It was 2022, and we were meeting over Zoom to talk about Title IV-B of the Social Security Act.

With its expiration date looming, the law should have generated natural momentum.

I’d been “in the room” to develop and pass several recent child welfare financing policies, including the 2018 Family First Prevention Services Act.

I thought reforming IV-B should have been simple.

Instead she cut me off before I’d finished my opening pitch:

“Look, I like you too much to waste both our time. You’re my fifth meeting on Title IV-B today, and this is the fifth set of unrelated ideas I’ve heard.

“Until your community can get on the same page and clearly communicate what it wants and why, you’ll be getting short-term extensions with no new money.”

That humbling moment sent me seeking answers to hard but clarifying questions.

You May Ask Yourself, How Did I Get Here?

In 2018, the field was at its peak– its ideas and alliances strong enough from years of collaboration and strategic leadership that it could move the Family First Prevention Services Act.

By 2022, we were struggling to build momentum for a straightforward reauthorization of a program as small as Title IV-B, which didn’t pass until early 2025.

Part of that story is the vacuum from losing key leaders.

But a new era is also demanding something different of our community than we’ve faced in recent memory.

Burning Down the House

Two threads are central to policymaking right now.

First is a high and persistent baseline volatility level.

You see it in partisan intractability, major restructuring across federal agencies, and the rising cost pressures and administrative burdens placed on states and localities.

The second is that policies designed for another era are failing to meet the challenges of this one.

Outdated policy structures create unanticipated incentives and accelerate drift.

You see it in Title IV-E’s outdated income-eligibility limits, which create drift, and in TANF’s structure, which shifts spending over time from direct economic assistance toward broader purposes.

Leaders across child and family policy, regardless of their politics or role, share some version of the sentiment that:

“it isn’t just the house that’s on fire… the whole neighborhood is on fire.”

When a single house is on fire, the instinct is to put out the flames and save what you can.

But when the whole neighborhood is burning, that instinct can prolong the pain and distract from choosing what to build next.

Throughout history we’ve had cycles of policy infrastructure that emerge, grow, strengthen, get stuck, decay, collapse, and lead to the next cycle.

We’re at that point of collapse now. It can feel like the end, but it’s the entryway into what comes next.

A moment like this invites the architect’s questions:

• Is this what we would build if we were starting from scratch today?

• Is this where we would build it if we could choose today?

Designing what comes next requires a position of real power and influence.

It will take an intentional shift in vision, and a return to these strategic principles that we’ve lost in recent years.

Scaling State Success

Good national ideas rarely originate in DC, and good state ideas rarely scale without national design; the architecture has to braid the two.

When I think back on my time as an advocate, nothing makes me shudder quite like recalling the outreach I did to state advocates and leaders.

Far too often, the point I reached out wasn’t when it was time to find what was working and build a policy idea, but when it was time to build momentum.

The ideas for what comes next won’t come from DC; they’ll be state and local successes worth scaling.

National and state advocacy and policy leaders and institutions can benefit tremendously from investing in relationships with each other, and infrastructure that makes this a default approach.

Creating Within Community

No single expert or organization can move a comprehensive agenda, and no coalition can succeed while leaving key players out.

It’s more effective to slow down and get into discussion with everyone else who has a stake in an issue. Including and especially those who don’t agree.

Longtime coalition leader MaryLee Allen regularly convened hundreds of advocates, policy experts, and stakeholders from all across the country for deliberative discussion, disagreement, and shared learning.

This created conversational space for those ideas to develop and garner support across the ideological spectrum, key preconditions for building something new.

Embracing Productive Adversity

When consensus becomes the cover charge at the door, the room reinforces blind spots instead of insight.

Policymakers often need to put out partisan proposals before they can negotiate across the aisle.

Advocates often need to issue a maximalist position before they can convey what they can live without.

That step isn’t annoying theatrics; it’s a core part of the process that creates the conditions for compromise that emerge from strong negotiating positions.

Family First is a great example of this. Two of its core policies emerged as partisan policy proposals from Senate Finance Committee leaders.

Senator Ron Wyden (D-OR) and the late Senator Orrin Hatch (R-UT) put out expansive proposals on prevention and congregate care reform, respectively.

That gave them each a place from which to negotiate and make concessions as they found a viable version.

Consensus can be powerful, but only when it requires everyone actually giving something up after first pushing hard enough to generate friction.

We Know Where We’re Going

Progress depends on clarity, structural intelligence, and the ability to see across perspectives—not just within them. That’s what I founded Wonk to offer at scale.

As the policy structures we’ve all taken for granted unravel around us, our community faces an invitation to shape the next child and family policy framework.

What to build is debatable. Whether to build it is not.

By Doug Steiger, MPP, Senior Contributor

If you work in child and family policy, you can’t ignore the Senate Finance Committee.

It’s one of the most powerful, most peculiar committees in Congress — and it holds the purse strings for most federal child welfare funding.

Here is a quick guide, from a recovering committee staffer, to understanding and engaging with this important, and quirky, entity.

What’s on its Plate?

The Finance Committee runs on tax and health policy. Child and family policy mostly breaks through when it intersects with those priorities – most often through Medicaid.

Its jurisdiction includes:

• Taxes

• Medicare

• Social Security

• Medicaid

• Trade

• Unemployment Insurance

And less visibly, but critically:

• Most federal child welfare funding, including IV-E, Family First, the Chafee program, and adoption assistance

• TANF

• Mandatory child care funding

• Child support

• MIECHV (home visiting)

Who Wants a Seat on the Committee?

Almost every Senator wants in on Finance.

Why? Taxes and health care touch every state, every campaign, every donor list.

• Republicans usually come for the tax code

• Democrats usually come for health policy

• Everyone wants the campaign cash that flows from overseeing tax, trade, and health.

Senators focused on appropriations or national security are the main exceptions– they tend to prioritize other committees.

The bottom line: Finance is a prestige committee that builds policy power and war chests.

What Makes Finance Different

Finance doesn’t behave like most Committees.

Subcommittees of the Finance Committee do not mark up legislation and are often inactive.

This differs from most other committees, including Ways and Means, its House counterpart.

Lower-profile issues get less attention than at Ways and Means, absent an individual member’s interest, since they rarely gain a full committee hearing over tax and health issues.

The Finance Committee also votes on “conceptual” language for legislation, and sometimes the legislative text is finalized by staff afterwards.

This contrasts with the standard practice of other committees, which vote on the actual text of legislation during mark-ups.

Winning an amendment vote during a Finance markup does not guarantee the legislative text is written how you want it.

How Finance Works

Finance runs on two parallel staffs.

• Majority staff: work for the Chair.

• Minority staff: work for the Ranking Member.

They may help other Senators from their party on the committee, but loyalty to their boss comes first. The staffers usually have narrower portfolios and deeper expertise than a Senator’s personal office staff .

Finance Committee members have staff that focus on the busiest parts of the committee’s jurisdiction – tax, health, and trade.

Child and family policy is often the responsibility of the health staffer.

If Medicaid is involved this can be helpful, but often means they have less time and expertise for other programs that serve families.

And because health expertise is prized in the private sector, staff churn is frequent.

With tax and health issues occupying the Committee’s leadership, space opens for rank-and-file members to leave a mark on child and family policy.

For example, the Chafee program is named for the late Senator John Chafee (R-RI), a leader on child welfare who never served as the Finance chairman or ranking member.

Finance’s Levers of Power

Why Finance matters more than most:

• Tax Code

  • As the “tax” committee, Finance often legislates policies through the tax code.

  • That’s how it shapes everything from family tax credits to nonprofit incentives.

• Mandatory Money

  • It also oversees the largest amount of mandatory – or “entitlement” – funding in the Senate.

  • This means it can “spend” without relying on the Appropriations Committee and the increasingly challenged annual spending bills.

  • Mandatory funding can continue for years, absent further legislation.

• Nominations

  • Treasury and HHS Secretaries– plus critical child and family policy roles like Assistant Secretary for ACF–need committee approval before heading to the full Senate.

  • Members on Finance can extract commitments from nominees early, long before most Senators get a vote.

• Oversight Muscle

  • The Finance Committee can launch oversight investigations into agencies within its jurisdiction, which includes much of HHS, the IRS, and the Social Security Administration.

  • One recent example is Finance’s investigation – conducted with the HELP Committee – of youth residential treatment facilities.

  • The Democratic staff has an ongoing investigation into the finances of Jeffery Epstein.

  • Should Democrats regain control of the Senate in 2026, expect oversight investigations into the Trump Administration in 2027.

How to Engage Finance

Start where the power is: majority and minority committee staff.

They know the issues cold and work directly for the Chair and Ranking Member.

If you’ve got a connection – or can generate one – to another member of the Committee that can also be a good place to start.

The Chairman or the Ranking Member may be especially likely to help Committee members of their party with an issue when those members are up for re-election.

As always, effective advocacy relies on understanding the perspective of those you are talking to and benefits from an ability to make an issue tangible through data or personal stories.

This is particularly true when you can tie it to the state a Senator represents, such as impact on constituents or state budgets.

What Decision Makers Need to Know

• Finance controls the mandatory dollars (IV-E, TANF, Medicaid) that drive your budget.

• Having a Senator on Finance can mean faster problem-solving — or bigger risks if they’re disengaged.

• Child and family policy won’t rise on its own; you need a member champion and a sharp state-level case.

• Nomination hearings are underused leverage points to get issues on the radar.

• Committee staff are the real gatekeepers; build those relationships first.

• Health staff also carry most child and family issues, but they’re stretched thin — clarity and brevity win.

Closing

The Senate Finance Committee is a powerhouse — controlling the flow of entitlement dollars, shaping the tax code, and vetting top HHS and Treasury officials.

For child and family policy, it’s where durable funding and real leverage sit.

But here’s the catch: tax and Medicare crowd out almost everything else.

Child welfare issues don’t surface unless someone makes them unavoidable.

Understanding how Finance works — and where the hidden levers are — is the first step to making that happen.

Doug Steiger is a Child Welfare Wonk Senior Contributor and public policy consultant.

He served as a Counselor to the HHS Secretary during the Obama Administration and was a Senate staffer for 12 years

By Doug Steiger, Child Welfare Wonk Senior Contributor

TANF’s history drives its current challenges, and its obstacles to evolution

If you blinked, you might’ve missed the last time TANF had a serious moment in the political spotlight.

Born in the wake of innovative Aid to Families with Dependent Children (AFDC) waivers, TANF initially looked like a success as the welfare caseload melted away, aided by the booming 1990s economy.

With that perceived success came a loss of political interest. The “problem” had been solved.

Since then, cash welfare has rarely commanded attention. SNAP and Medicaid took center stage. TANF faded into the policy background.

The Quiet Block Grant

TANF—Temporary Assistance for Needy Families—is the $16.5 billion per year block grant that replaced the 60-year-old AFDC program back in 1996.

TANF was meant to promote work and reduce dependency, and it gave states great flexibility in how they spend funds in return for meeting work requirements.

But nearly three decades in, TANF has drifted out of the spotlight. With little federal oversight and no inflation adjustment since its creation, the block grant has lost over 40% of its value in real dollars.

Able to largely meet the work participation requirements through smaller caseloads and with cash welfare no longer an important political issue, states have looked to flexible TANF funds as a source to meet other social service needs.

States have repurposed the funding to plug budget holes or support other priorities—child welfare chief among them.

15 states spend one-fifth or more of their TANF funds on child welfare, ranging from 20 percent in Kansas and Virginia to percent almost 80 percent in Arizona (see Table).

States now spend only about one-third of TANF on cash aid or job training programs.

It has been easier to meet the work participation requirements through smaller caseloads than large-scale investments in welfare-to-work programs and increasing cash benefits is rarely popular, even if their value has diminished over the years.

Meanwhile, the safety net shrinks: fewer than one-quarter of poor families receive cash benefits, down from two-thirds under AFDC.

Pilots for Progress?

In 2023, Congress authorized bipartisan pilot projects to test new accountability approaches—less about activity, more about outcomes.

The idea: move beyond process measures like “participated in work activity” to actual results like “got a job” or “increased earnings.”

In November 2024, the Department of Health and Human Services (HHS) awarded pilots to five states after a competitive process where nearly half the states submitted proposals.

These states – Kentucky, Ohio, California, Maine, and Minnesota – were to spend FY 2025 negotiating the details of their accountability measures.1

But in March, HHS canceled the pilots. The rationale? The original selection criteria weren’t aligned with the Trump Administration’s priorities. Applications were due by August 15, 2025.

We will see if they also select pilots with negotiated employment-related benchmarks. A main difference is the metrics would now emphasize achieving employment goals without families continuing to receive other forms of benefits, such as SNAP and Medicaid, something the previous iteration did not consider problematic.

Congressional Drift—or Drive?

In a rational policy process, Congress would wait for pilot results before reforming TANF. But five years is a long time to wait.

In April, Ways & Means Republicans held a subcommittee hearing on TANF. In May, they introduced the JOBS for Success Act , echoing some of the pilots themes. .

The bill would:

• Replace the current work participation requirements with a “universal engagement and case management” requirement for adults on TANF;

• Hold states to negotiated benchmarks for employment and earnings for those leaving TANF;

• Require TANF funds spent on child care and early childhood programs to be transferred to those programs rather than being spent directly; and,

• Mandate that at least 25% of TANF funds support “core” activities of job training, case management, and “work supports.”

  • This could put pressure on child welfare financing in states where TANF has been an important source of child welfare funding.

• Some elements of this bill are similar to pilot proposals selected in 2024.

Is Change Coming?

The House Republicans could have folded TANF provisions into the One Big Beautiful Bill Act (OBBBA), but they didn’t, likely because reconciliation rules might’ve blocked some proposals.

This suggests that TANF reform is not a top-tier priority. But now with the OBBBA done, Ways & Means may turn its attention back to a TANF bill.

In particular, if House Republicans believe “welfare reform” still plays well politically, it may be something that moves next year as the election nears.

But Ways & Means also oversees tax, trade, and Medicare. TANF will be jockeying for floor time.

So far, the Senate has shown little appetite for TANF reform. But if the House acts, that could change.

For those interested in – at long last – significant changes to TANF, keep an eye on two things:

• Who gets selected in the re-run of the pilot program with what metrics for success.

• Whether the Ways & Means Republicans ramp up work on legislation.

  • Democrats have been more interested in expanding the child tax credit as a way to support low-income families than revisiting TANF and its issues.

Doug Steiger is a Child Welfare Wonk Senior Contributor and public policy consultant.

He served as a Counselor to the HHS Secretary during the Obama Administration and was a Senate staffer for 12 years

By Doug Steiger, Child Welfare Wonk Senior Contributor

The findings from this Data Drop on mental health need and foster care underscore what those in child welfare already know intuitively: children in foster care face a growing mental health crisis. 

Despite bipartisan expressions of concern and frequent hearings over the past five years, no comprehensive federal strategy has emerged. The explanation is structural, not cynical.

Why the Structure of Government Matters

Congressional outsiders focus on leadership and personalities. Insiders know that Congress’ circulatory system rests on committee jurisdictions; who “owns” what issues.

Readers will know that these committees tend to focus on what they oversee, rather than viewing the needs of foster youth holistically. 

Understanding this dynamic unlocks deeper insight into why policy moves or stagnates, and how to navigate this terrain effectively.

The House

Key levers for addressing children’s mental health are spread across multiple committees, which often have different incentives, expertise, and goals:

• Ways & Means 

  • The Power: Congress’ oldest committee has jurisdiction over foster care funding, including Title IV-E.

  • The Imbalance: Members seeking spots here are more likely to want to flex tax, trade, and tariff chops than safety net expertise.

• Energy & Commerce 

  • The Power: E&C oversees Medicaid and most public health and mental health programs.

  • The Imbalance: Major health resources flow through E&C, but there’s no required connection to child welfare financing.

• Education & the Workforce 

  • The Power: Ed & Workforce has jurisdiction over the Child Abuse Prevention and Treatment Act (CAPTA).

  • The Imbalance: CAPTA’s requirements on states make it a driver of policy, but its lack of relevant open-ended funding constrains its leverage.

The Senate

Senators’ representation of states provides disproportionate rural influence, shaping how the Senate sees issues. 

Jurisdiction is more consolidated, driving broader perspectives and coordination, while simultaneously making it challenging to map policy and process to what the House does.

• Finance Committee

  • The Power: Finance oversees most health financing, including Medicaid, and most foster care and safety net programs.

  • The Imbalance: Health financing policy alone is so large that it takes significant bandwidth and focus.

• Health, Education, Labor, and Pensions (HELP)

  • The Power: HELP oversees public health and mental health programs, as well as CAPTA.

  • The Imbalance: HELP has authority over the agency infrastructure of most of HHS, but not the core resource flows that Finance controls.

The Administration

In the absence of legislation, the executive branch, particularly the Department of Health and Human Services (HHS), tends to act at the margins: through guidance, grants, and regulatory tweaks.

One angle to watch is Secretary Kennedy’s interest in reducing the use of psychotropic medicine for children, which could lead to a coordinated effort.

However—with proposed budget cuts, a shift toward block grants, and increased fiscal pressure on states—the Administration’s tools may be shrinking just as the need grows.

What Lies on the Horizon for Mental Health on The Hill

Budget reconciliation will reduce Medicaid spending by nearly $1 trillion over the next decade.

As a result, state Medicaid programs will face serious fiscal pressures just to keep the status quo, making expanding their mental health supports or improving their quality a serious challenge.

But there are federal resources for mental health in public health programs. 

The House has passed the SUPPORT for Patients and Communities Reauthorization Act which renews a host of public health programs with modest changes, including for children’s mental health programs.

The bill passed the House on a bipartisan vote of 366-57, but faces headwinds from Democrats uncomfortable with the Administration’s changes to the agency implementing the law.

Conclusion: What Could Change the Game

In Washington, legislation passes when it is either politically important to the majority party or is bipartisan. 

Foster care issues are never that important politically, so a bill addressing the mental health needs of foster youth needs to be bipartisan – and if it’s comprehensive, it will need to be bipartisan across multiple committees. 

It’s hard to negotiate meaningful bipartisan policy in one committee, let alone more than one.

That’s why structural leadership matters, and often requires White House pressure. 

This is rare but not unheard of – 1997’s Adoption and Safe Families Act became law in part because Hillary Clinton and House Majority Whip Tom DeLay collaborated on its policies to promote adoption. 

First Lady Melania Trump has repeatedly expressed interest in older youth in foster care, which could be a structural pressure for progress. 

Substantive progress is possible despite these architectural barriers, but anyone who wants to advance it needs to be aware enough to navigate them effectively.

Doug Steiger is a Child Welfare Wonk Senior Contributor and public policy consultant.

He served as a Counselor to the HHS Secretary during the Obama Administration and was a Senate staffer for 12 years.

How an arcane budget policy rule could compound cuts across more programs without Congressional action.

By Doug Steiger, Child Welfare Wonk Senior Contributor

With budget reconciliation enacted, leaders and policy experts are preparing for cuts of nearly $1T to Medicaid and $186B to the Supplemental Nutrition Assistance Program (SNAP).

They would do well to also prepare for the possibility of across-the-board cuts to even more programs.

Driving Deficits

If you heard anything about the One Big Beautiful Bill Act (P.L. 119-21), it was that the law’s safety net cuts offset its new spending on tax, defense, and immigration enforcement policy.

However, despite significant reductions to programs like Medicaid and SNAP, the cost of tax cuts was so significant that the law is forecast to increase the deficit.

The Congressional Budget Office (CBO) estimated it will lead to an increase of more than $3 trillion over the next ten years.

This matters because it triggers other aspects of budget policy.

Specter of S-PAYGO

Increasing the deficit isn’t merely contested framing between partisans; it brings into play an arcane federal budget rule we have previously flagged, Statutory Pay-As-You-Go (S-PAYGO).

S-PAYGO attempts to manage the deficit by requiring cuts (or “sequestration”) at the end of a Congressional session if the cumulative changes to taxes and mandatory spending have increased the deficit.

It was established in 2010 as part of legislation to increase the debt ceiling, the latest in a series of similar “pay as you go” measures dating back decades, with the idea that the prospect of such cuts would keep policymakers from deficit-increasing bills.¹

Given the size of the deficit increase in the reconciliation bill, the sequestration cuts required by S-PAYGO would be on the order of $300 billion.²

Social Security is exempt from these cuts. Medicare is not, though benefit reductions are limited to 4 percent.

Some low-income programs, including Medicaid, SNAP, Title IV-E foster care, and TANF are also exempt.

Importantly, as we noted before, there are several safety net programs serving children and families that are subject to sequestration³, including the:

• Social Services Block Grant (SSBG)

• Maternal, Infant, and Early Childhood Home Visiting MIECHV) Program; and

• Mandatory funding for the Title IV-B Promoting Safe and Stable Families program.

Since the OBBB Act triggered S-PAYGO, Congress would need to act to prevent these across-the-board cuts.

When to Worry

S-PAYGO dates to 2010, but typically has led to a pro forma waiver instead of cuts.

The reconciliation bill did not include a waiver.

Does that mean the Republicans intend to allow the across-the-board cuts to happen? Probably not, though these are not usual times.

While some conservatives would cheer the resulting cuts, it is not certain if the Administration wants them.

President Trump, for example, has regularly warned conservatives not to cut Medicare, though he has been known to change his positions.

What’s likely to happen

Congressional Republicans could move to enact a waiver later in the year, either as part of another comprehensive bill or as a standalone provision, and dare Democrats to object to heading off the Medicare and other cuts.

This would be challenging though; there are fiscal conservatives who would like further spending cuts, and they might not approve of a party-line strategy that requires them to vote for a waiver to engage in this game of chicken with Democrats.

Another option could be the usual approach; including the waiver in negotiated bipartisan legislation.

For example, it could be part of whatever appropriations legislation is eventually enacted to fund the government.

But we have noted that those negotiations appear especially difficult this year.

Alternatively, the White House could employ creative scorekeeping.

As it happens, the final arbiter of the “scorecard” is not CBO but the White House Office of Management and Budget (OMB).

This would be in line with the pathway that brought us here; Senate Republicans opted to use a different spending baseline than the norm for scoring the impact of the tax cuts.⁴

Under this Administration, OMB has been testing the limits of budget law, such as withholding appropriated funding.

In light of this, it seems plausible that OMB could “score” the deficit impact of the reconciliation bill in such a way as to simply eliminate the need for sequestration.

What Lies Ahead

So, yes, we are currently headed for large “sequestration” cuts later this year.

However, there are solid reasons to think that, as in the past, a waiver will turn off the automatic cuts.

But given all the unprecedented things happening in Washington, this is not the year to simply assume enactment of a waiver, even if all the players think it should happen.

Doug Steiger is a Child Welfare Wonk Senior Contributor and public policy consultant.

He served as a Counselor to the HHS Secretary during the Obama Administration and was a Senate staffer for 12 years.

Waiting on a Waiver: Projected Cuts by State

While an S-PAYGO waiver is typically forthcoming, Doug’s analysis makes clear that there’s a material difference between improbable and impossible.

It’s beneficial to know what the impact could be on funding after the end of this Congress, given the myriad other headwinds this year.

So Child Welfare Wonk has got you covered, whether you’re a:

• Hill staffer prepping for complex FY ‘26 funding debates;

• Agency leader updating your budget following the OBBB Act;

• Funder revising strategy amidst endowment changes and new grantee needs; or

• State advocate wondering about how to orient to your next legislative cycle.

This map shows the projected cuts, which range widely, from $5M to over $100M+.

These are the ten states facing the biggest S-PAYGO cuts broken down by program.

By Doug Steiger, Child Welfare Wonk Senior Contributor

The Senate is considering a reconciliation bill that would upend the negotiated balance that the House barely cleared 215-214.

Complex ongoing negotiations with implications for Medicaid and other child and family programs will determine whether Senate Republicans pass a bill that can also pass the House.

Ticking in the background is the debt limit clock; the bill would lift the debt ceiling, which we will breach without action at some point in August. Here’s what to watch.

One Big Beautiful Bill 2.0

The emerging Senate bill has important differences from the House bill. These include: larger Medicaid cuts, in particular through stricter limits on “provider taxes¹,” a key funding source for Medicaid programs.

The Senate version also makes more people subject to Medicaid work requirements, in particular parents of children over 14.

These savings align with longstanding GOP goals for structural changes to Medicaid. They also free up funds for bigger tax cuts, and a slower phase-out of clean energy tax credits that split GOP Senators along regional rather than political lines.

The Senate version also applies SNAP work requirements to fewer families.

BUT, the bill drops the exemption to work requirements for young people who have aged out of foster care.

In a bill of this size, changes like this can easily slip through unnoticed.

Provisions– like the exclusion of the House’s SALT² deduction increase and a slower phase-out of clean energy tax credits are active points of negotiation.

They play along complex regional lines that add further tensions to the pathway to a majority vote. With talks ongoing, the final shape of the bill remains in flux.

What’s still being negotiated

There are 53 Senate Republicans. At least 50 have to vote for the bill.

Finding those votes involves balancing the desire of some conservatives to reduce Medicaid and SNAP spending with the concerns those cuts raise with other Senators.

It also requires finding the right mix of tax provisions, given different priorities among the provisions affecting industries, investors, and families.

Who counts in the Senate and why

With just a few votes to spare, Senate Republicans must reconcile competing priorities—tax cuts, structural safety net reforms, and debt and deficit reduction.

None of this maps neatly; it reflects complex realities back home. These are the players shaping what makes it into the final bill—and what gets cut to get there.

• Senate and Committee Leaders

  • Majority Leader John Thune (R-SD), responsible for lining up the votes for final passage.

  • Finance Committee Chairman Mike Crapo (R-ID), who oversees the tax and Medicaid provisions.

  • Agriculture Committee Chairman John Boozman (R-AR), who oversees the SNAP provisions.

• Conservative Medicaid Defenders

  • Senators Josh Hawley (R-MO) and Jim Justice (R-WV), who convey their support for Medicaid in MAGA framing about impacts on working class voters and rural hospitals

    • Senator Justice has also expressed concern about the impact of SNAP cuts in his state.

• Centrist Medicaid Defenders

  • Senators Lisa Murkowski (R-AK) and Susan Collins (R-ME), concerned about the impact on their states, such as on rural hospital finances.

• Deficit & Debt Detractors

  • Senator Johnson (R-WI), seeking deeper spending cuts than the bill contains.

  • Senator Paul (R-KY), opposed to the provision increasing the debt ceiling, which is necessary to avoid a separate debt ceiling negotiation with Democrats.

Who counts in the House

Once the Senate passes its version of the bill, the House will be pressured to pass it “as is” so that the President can quickly sign it.

However, there are House Republicans committed to the increased SALT deduction the Senate has dropped.

If they hold firm, they could prevent the Senate version from passing the House.

House conservatives remain committed to substantial Medicaid and SNAP cuts. If Senate negotiations result in smaller cuts, they could insist on changes too.

Yet House moderates could object to the deeper cuts the House conservatives are seeking. At each stage, negotiation is fraught and multi-dimensional.

It’ll probably come down to the President

President Trump’s power over Republicans will likely force a bill through, deciding whose concerns count and whose get cut.

What counts in the clutch

In the short term, the action is in the Senate, particularly with those Senators listed above.

Congressional Republicans are under significant pressure to pass something, which makes broad opposition less impactful.

The messenger matters as much as the message– and what breaks through are constituent-specific consequences. In a message-saturated environment members tune out “vote yes” and “vote no” outreach.

What gets attention is clear, localized impacts, especially when they scale across a district or state. That’s why niche policy like the SALT deduction makes national noise.

It is possible the bill could be voted down, even more than once. Sometimes, the pressure of a failed vote is what forces recalcitrant members to accept difficult compromises.

In the coming days, what rises to Members inboxes will help determine what makes the bill, and what hits the cutting room floor.

By Doug Steiger, MPP

Last week’s Ways and Means hearing opened the window for Chafee reform, with Republicans signaling bipartisan interest. The question now is who will shape and set the terms of that process.

Child welfare policy is deeply important to those working on it, and rarely registers with lawmakers. This dynamic drives the policymaking process; bipartisanship is a central ingredient for enacting legislation on issues that do not hold the daily headlines.

The key early sign to watch for is public overtures toward bipartisanship. We saw that from Republicans at last week’s hearing, which suggests interest in working with Democrats.

Whether it’s possible in this specific moment is the wrong question; the right one is what it looks like to be well-positioned when the odds improve after larger legislative battles settle next year.

Those invested in the Chafee program would be well-served to express their views to bipartisan lawmakers and policy partners soon to define the next policy debate.

What Chafee Does

Chafee is the main federal program for older foster youth. It provides states with flexible funding for supports like educational assistance, employment help, and life skills training.

It is designed for youth likely to “age out” of foster care.

Depending on the state, youth currently or formerly in foster care aged 14 to 23 may be eligible for Chafee services.

Why Some Chafe at Chafee

The Chafee program is not reaching many eligible young people, and it’s unclear how much it's helping those it does reach.

An estimated 47 percent of eligible young people ever receive even one of the services Chafee covers.

Evidence on the effectiveness of those services is also limited, though the Department of Health and Human Services’ Administration for Children and Families (ACF) has funded a project to improve that knowledge base.

Where the Debate May Go

One key issue at the hearing: unused Education and Training Voucher (ETV) Program funds. The ETV helps current and former foster youth cover the cost of college or vocational training—up to $5,000 per year.

Too often, ETV goes untapped due to red tape, lack of outreach, or eligibility barriers that don’t match the realities on the ground.

One proposal is to allocate funds by a state’s share of Chafee-eligible youth, rather than all foster youth, to better target resources. A GAO report on this issue is here.

While this sounds simple, wonks hear “formula revision” and gird for battle: funding shifts inevitably create “winners” and “losers.” That distribution rarely falls neatly along partisan lines, creating complex regional politics.

Several other aspects of Chafee came up at the hearing, all of which have been places of recent bipartisan policy discussion: employment, housing, mental health, expanded eligibility, access to driver’s licenses, and mentorship programs.

Conditions for Expanding Flexibility

The Chafee program offers states flexibility to choose among a variety of services.

A perpetual challenge for policymakers is balancing a desire to support the most effective approaches with state discretion to adapt programs to the needs of individuals and local conditions.

In a Chafee bill, Congress could limit services to those believed to lead to the best outcomes. Or it could expand the allowable services to give those on the ground more tools.

The latter is more likely – a shorter menu draws opposition from those who support the activities being dropped.

Given unmet need and a host of policy ideas, Congress could choose to increase funding for Chafee. However, that seems unlikely in the current climate.

What Comes Next

The House Republicans appear open to a bipartisan Chafee bill, but there aren’t many incentives or pressures for Democrats to negotiate yet.

To date, the Trump Administration has made no major proposals on the Chafee program. A potential wild card is the possibility the First Lady will take an interest, making it more of a priority for Republicans.

The White House credited her with championing a $25 million HUD proposal for youth aging out of care last month.

Given the needs of the Chafee population, some could argue a bold rethinking of the program is in order, such as structural redesign. A more likely scenario is a set of tweaks to the current program, like what it covers and for who.

Judging from the House hearing, there’s no clear consensus yet on a new direction for Chafee.

If you have a fresh idea, now’s the time to surface it; before the boundaries of deliberation emerge.

Those already crafting memos, honing ideas, and cultivating relationships to highlight what’s working and what’s not will be the first movers to frame the debate.

Finding the right mix of provisions to garner bipartisan support for a child welfare bill often takes time. This hearing may have been the start; don’t get caught flat-footed.

Doug Steiger is a public policy consultant. He served as a Counselor to the HHS Secretary during the Obama Administration and was a Senate staffer for 12 years.

Say Less is our series from Kimberly Martin, exploring the contradictions and policy tensions contained in the seemingly simple words we take for granted.

Kimberly’s piece digs into accountability, one of the most loaded words in child welfare. It challenges the “reform” vs. “abolish” discussion, exposing structural contradictions that should concern leaders across the ideological spectrum.

It also points toward a deeper project; designing systems that are structurally accountable both upward and downward.

What We Mean When We Say “Accountability”

By Kimberly J. Martin, JD.

Accountability is central to child welfare oversight, but its definition and application depend entirely on where you sit. That shapes system behavior and family experience.

At its best, accountability reflects transparency, ownership, and a willingness to answer for outcomes based on shared expectations. But in child welfare? What you’re accountable for, and who you’re accountable to, depends entirely on where you sit.

Systems account for federal monitors. Families account to the state. One submits metrics, the other surrenders children.

Differing Timelines for Accountability

I’ve witnessed families being told to change everything in 30 days, while states fail the same safety outcome for a decade. Parents meet every requirement in their case plan, only to be told they weren’t “engaged enough.” Accountability is a moving target for families, and a resting place for systems.

The Power Flows of Accountability

Accountability is about power; who has it, who doesn’t, and who defines the terms. Congress writes mandates, agencies create checklists, and parents are told, ‘We don’t trust you to know what your family needs.’ That dynamic reflects control more than support.

The most powerful forms of accountability are chosen. When an agency says, “No more warehousing kids in group homes,” or when a frontline worker returns every parent call within 24 hours, not because policy demands it, but because they deserve it, that’s when change sticks. The power there emerges from intentionality.

What We Want and What We Get

We claim to want authentic outcomes, but we chase them with coercive tools. We design accountability mechanisms rooted in mistrust, then act surprised when they don’t produce trust. That contradiction doesn’t just undermine families, it creates rigid, performative policy that makes systems less accountable to policymakers.

We ask parents for weekly proof of treatment, sobriety, and housing. Meanwhile, agencies fail the same Child and Family Services Review (CFSR) indicators for years without consequences. Since CSFRs began in 2000, no state has met all benchmarks. Yet this persistent failure has created neither urgency nor a public conversation about whether the benchmarks themselves are the right measure.. Instead, we turn up the pressure, just not on the system.

When Accountability is Flexible

Take the Family First Prevention Services Act (FFPSA). It’s supposed to hold systems accountable by reducing group placements and funding prevention. But implementation has dragged. In FY2018 when Family First passed, 10 percent of children in care were in group homes or institutions.⁴ In FY 2023, 11 percent of children were in group homes, institutions, or residential care.⁵

The issue could be more kids in those settings, or better data quality reflecting the real rate. Either way, the pace of reform isn’t just slow, it’s optional, and we have ongoing policy discussions about how to help states implement it. Meanwhile, parents face hard 15-month timelines under the Adoption and Safe Families Act (P.L. 105-89, ASFA), with little flexibility for the challenges they face.

When a child dies under state supervision, public outrage is swift, but rarely upward. Maybe a director resigns. But when the same outcomes persist for decades, that’s not a fluke; it reflects how current accountability structures are designed and applied. Everyone passes the pressure downward until it lands on families, especially the ones with the fewest resources and advantages to deflect it.

What Accountability Measures Matter

Too often, systems say they’re being accountable when what they really mean is they’re being measured. And those measurements are shaped by federal law, state budgets, and media optics, not families. When those goals conflict, families lose.

A uniform approach to accountability would mean timelines for agencies or more flexibility for families. It would also mean tracking not just whether services were provided, but whether they worked, and for whom..

Would pulling funding change how systems respond? Maybe. But federal agencies already have that authority, yet rarely use it. When they do, it can backfire, so it doesn’t seem to be a viable option. Policymakers recognize this and have shifted increasingly to incentives for systems. Perhaps next we could offer families the kinds of incentives and flexibility we offer systems.

Accountability can’t be a mirror we hold up only to families. It must be a window into how systems function and a door to change when they don’t. If it doesn’t apply in both directions, it’s not a principle. It’s a weapon.

Say less.

Kimberly Martin is a policy strategist whose work spans justice reform, equity, and systems accountability. She brings both legal insight and lived experience to the child welfare conversation.

By Doug Steiger, MPP

Are you ready if the federal government shut down for weeks in the fall? But, you ask, didn’t we just avoid a shutdown?

We did – but only for the current fiscal year, ending September 30th. Congress still needs to keep the lights on for the next fiscal year. Odds are high for a sequel to that drama, and a long shutdown..

The Structural Tension

Each party faces different challenges in government funding negotiations. That’s not a partisan read, it’s a structural tension inherent in key party differences.

Most years, the key players are able to negotiate a compromise. But, as you may have noticed, this is not most years.

When Republicans run both chambers they face a two-fold challenge in funding the government:

• Senate Democrats can filibuster a bill they oppose; and

• House conservatives insist on sharp spending cuts.

In Congress, members may have to say “I’ll vote ‘no’ unless I get what I want,” to have leverage. When enough of them do that, the whole process can grind to a halt.

How it Usually Plays Out

A Republican House typically passes appropriations bills at low enough funding levels for the conservatives, which are then stopped by Senate Democrats.

Eventually, a deal is made that raises spending levels so enough Democrats support it to offset the loss of conservative votes, often at the expense of a stable speaker’s gavel.

What’s Different this Time

The advent of DOGE and OMB’s withholding of funding make it difficult for Democrats to agree to a deal along the usual lines.

OMB Director Vought has been clear in his belief that the executive branch is not required to spend the money that Congress appropriates. DOGE has dismantled whole agencies without explicit legal authority.

This development upends the usual dynamic; Democrats become far less willing to provide bridge votes when they can’t be sure the concessions they are extracting are real.

How March Played Out

In March, congressional Democrats were faced with a stark choice; oppose the continuing resolution (CR) to fund the government to seek concessions, risking a government shutdown, or vote for the CR to keep the government open.

When there were no negotiations to be had, Senator Schumer and a few other Senate Democrats supported the CR, fearing the damage from a shutdown.

Wake Me Up, When September Ends

Come September, the same dynamics will likely apply. A CR will be required since the appropriations bills will likely not be finished.¹

In a normal year, Senate Democrats would consider agreeing to a CR that does little more than keep the government operating on autopilot. Doing so now would risk empowering DOGE and OMB further, eroding the likelihood of Democratic support.

Absent a bipartisan agreement, House Republicans can send the Senate a CR with lower spending levels, leaving Democrats with the same tough choice as in March.

Signals of a Shutdown Showdown

There’s a good chance that the next time, Senate Democrats will face stronger incentives to filibuster, especially in light of the blowback to the March vote.

Pressure from Democratic voters to oppose the President may also increase even further if Congress enacts large Medicaid and SNAP cuts before October.

Why it Matters for Child Welfare

What would a shutdown mean for child welfare? The good news is that programs with “mandatory” funding, such as Title IV-E foster care and Medicaid, would continue.

But agency staff managing these programs could face furloughs. That’s on top of prior major staff reductions, and would be compounded if they are also supposed to be implementing changes from the One Big Beautiful Bill Act.

Programs that rely on appropriations, such as CAPTA, would not have federal funding until the shutdown ends. Ordinarily, this means a delay in funding, which can be painful if grants were expected in the fall.²

This year, though, those delays would occur in the context of an Administration already openly exploring the frontiers of their legal authority for unilateral cuts to programs.

That raises the risk that theAdministration might seek to end programs when they are “unfunded” even temporarily. Lawmakers know this and it impacts their negotiations.

If there is a shutdown, it may be an extended one. The Administration may see a shutdown as an opportunity for further cuts, while Democrats will be reluctant to accept any Republican-drafted bill to reopen the government without concessions from the White House.

This means that if the government shuts down on October 1st, it may not reopen until Thanksgiving or later. State and local leaders can plan ahead to avoid a cash crunch.

Ignore past-oriented prognostication that trades clarity for certainty. Assuming that the old dynamics will return is a good way to be surprised by a foreseeable shutdown.

Doug Steiger is a public policy consultant. He served as a Counselor to the HHS Secretary during the Obama Administration and was a Senate staffer for 12 years.

Say Less is a series from Kimberly Martin, which exploring the contradictions and policy tensions contained in the seemingly simple words we take for granted.

Each edition of Say Less interrogates the language of child welfare policy, revealing the contested conversation underneath.

Written by policy strategist Kimberly Martin, the series draws from her lived experience and legal expertise to unsettle euphemisms and bring precision to policy.

Do We Mean the Same Thing When We Say “Prevention…?”

By Kimberly J. Martin, JD.

The layered language of child welfare reform obscures the paradoxes those words contain. Seemingly obvious words like “prevention” contain deep policy tensions.

Sometimes prevention means making sure families never need the system in the first place. Policies that promote economic development and a strong safety net promote family autonomy. Think quality jobs, stable housing, and direct financial support.

Sometimes prevention means community programs, like federal Community Based Child Abuse Prevention (CBCAP) grants. This too has layers; it can prevent or address a looming crisis, so families never encounter the child welfare system, or it can keep families “near but not in” the system, preparing them to enter it.

Other times, it means the system itself delivering services– case plans, compliance checklists, and conditional services offered under threat of removal. The Family First Prevention Services Act funds services to prevent foster care. But eligibility happens once you’re at imminent risk of entering foster care, which is the backup plan.

All of these are called prevention, and that’s the problem. One word is doing andhiding too much. When everyone’s using the same word for radically different things, families caught in the middle pay the price for the lack of clarity.

Prevention can be safety and it can also be surveillance. What are we preventing when a family isn’t “in the system” but is surrounded by it?

Bipartisan federal investments in prevention have grown in recent years, including:

• Title IV-B. Last year’s bipartisan reauthorization included $75M in new mandatory annual funding for the Promoting Safe and Stable Families program;

• Family First Prevention Services Act. Starting at $13M in federal funds in FY2020 it has continued to rise, to $172M in FY2023;

• CBCAP: From under $40M in FY2019 to $70M in FY2025.

The challenge is that funding follows framing. We’ve defined prevention in relation to the system, so 54% of federal Title IV-E funds still go to foster care; $5B in FY2023.

If “risk” is defined by poverty, disability, or race, then prevention becomes racialized prediction. That’s why last year’s Title IV-B reauthorization saw bipartisan commitment to ensuring poverty alone can no longer be considered neglect.

Even with this progress, too many families still encounter the system unnecessarily. One study found that 53% of Black children in the U.S. will experience a child-welfare investigation by the time they turn 18.

If you find that alarming, you should know that the base rate is also staggering; nearly one-third of all children nationally receive a child welfare investigation by age 18. That’s not prevention, it’s profiling – with paperwork.

I’ve personally experienced an inconvenient reality; in child welfare, proximity to the problem can disqualify you from defining it, while distance can buy you the authority to do so.

Until we agree on what prevention is and isn't, reform will keep misfiring, and families will continue taking the hit.

If prevention doesn’t restore agency to families and communities, it’s just another program pretending to help.

Say less.