Options for Allocating
State Child Welfare Dollars
to Wisconsin Counties
Prepared for the Wisconsin Department of Children and Families
Christine Durkin
Adam Hartung
Sara Kock
Jennifer Russ
Paul Waldhart
Problem
● Current formula may not match resources to
need as effectively as it could
● To form our alternatives:
● Literature review
● Surveys
● Interviews
● With other states
● With Wisconsin counties
Overview
● Current policy
● Alternatives
● Recommendation
● Cross-county collaboration
Background
Number of Reports/Cases
per 1,000 Children
● State supervised, county administered system
● Differences in demand for services
30
28.8
25
20
19.9
15.7
15
11.0
10
6.4
5
2.7
0
10 Highest
10 Poorest
Counties
Poverty Counties
Average Report Rates
Average Investigation Rates
10 Lowest
10 Richest
Counties
Poverty Counties
Average Substantiation Rates
Background
State Basic County Allocations
(In Millions)
● Funded with state and local dollars
● Declining state revenues
● Limiting property tax levy
$300
$290
$280
$270
$260
$250
$240
$230
'05
'06
'07
'08
Year
'09
'10
'11
Current Policy
In 1986, Wisconsin allocated child welfare money based on:
1. Total population
2. Residents enrolled in Medicaid
3. Property values
State Child
Welfare
Dollars
County
A
1986
County
A
2011
Alternatives
● We examined two alternatives:
1. Risk Factor: More risk = More $
2. Workload: More demonstrated need = More $
● We considered but eliminated:
3. Updating the current formula
4. Percent-For-Service: DCF reimburses counties a
percentage of service costs
5. Performance-Based Contracting: DCF purchases
outcomes, counties sell outcomes
Alternative #1: Allocation based on Risk Factors
Step 1
County need for child welfare services = β1Number of children in single
parent families + β2Number of children living in poverty + ԑ(error)
Step 2
County risk number = 0.33(Number of children in single-parent families in
county) + 0.67(Number of children living in poverty in county)
β1 / (β1+ β2) = 0.33 and β2 / (β1+ β2) = 0.67
0.33 + 0.67 = 100%
Alternative #1: Allocation based on Risk Factors
Step 1
County need for child welfare services = β1Number of children in single
parent families + β2Number of children living in poverty + ԑ(error)
Step 2
County risk number = 0.33(Number of children in single-parent families in
county) + 0.67(Number of children living in poverty in county)
Step 3
County allocation = (County risk number / Sum of risk numbers for all
counties) x Total CFA funding available
Alternative #1: Allocation based on Risk Factors
Step 1
County need for child welfare services = β1Number of children in single
parent families + β2Number of children living in poverty + ԑ(error)
Step 2
532= 0.33 (400) + 0.67 (600)
Step 3
$866,400= (532 / 35,000) x $57 million
Alternative #2: Allocation based on Workload
More cases and/or more labor-intensive cases = More $
● Children’s Research Center developed a framework
● DCF would:
1. Calculate time spent on each service area per case
2. Use eWiSACWIS to determine the number of cases
3. Calculate county workload (time per case x # of cases)
4. Allocate funds based on county’s proportion
Example County Workforce Estimate
County Service Area
CPS Intake
Screened-In CPS Reports
Screened-Out CPS Reports
CPS Investigation/Assessment
Investigated Cases w/out Substantiation
Investigated Cases with Substantiation
Child and Family Services
New Child Case
Ongoing Child Case
Number of
Worker
Cases per Hours/Case
Month
per Month
Total
Worker
Hours
127
75
1.1
0.3
140
22
95
8.1
773
23
13.4
309
13
14
9.5
6.6
127
1,139
Total County Workload Demand in Worker Hours
County Proportion of State Aid
2,512 hrs
6.2%
Goals
● Effective
● Matches need with
resources
● Minimal potential for
cheating
● Equitable
● Measures need
regularly
● Equal spending per
person
Estimated County Allocation per Person, by
Percent of County Population Living in Poverty
CURRENT POLICY
County Allocation per Person
$80
R² = 0.4812
$70
$60
$50
$40
$30
$20
$10
$0%
5%
10%
15%
20%
25%
30%
Percent of County Population Living in Poverty
35%
Estimated County Allocation per Person, by
Percent of County Population Living in Poverty
CURRENT POLICY
$80
$70
$60
$50
$40
$30
$20
$10
$-
RISK FACTOR FORMULA
$50
R² = 0.4812
R² = 0.7744
$40
$30
$20
$10
$-
0%
10%
20%
30%
0%
40%
10%
20%
WORKLOAD METHOD
$40
R² = 0.2372
$30
$20
$10
$0%
10%
20%
30%
40%
30%
40%
Goals
● Effective
● Matches need with
resources
● Minimal potential for
cheating
● Equitable
● Measures need
regularly
● Equal spending per
person
● Lower Additional Cost to DCF
● Acceptable to Counties
● Methodology
● Magnitude of gains &
losses
● Number of gainers &
losers
Magnitude of Changes in County Allocation, by
Percent of County Population Living in Poverty
RISK FACTOR FORMULA
WORKLOAD METHOD
Aggregate Change in County CFA
(in Millions)
$3
$2
$1
$0
-$1
-$2
-$3
Highest
1st
Poverty
Quartile
Counties
2nd
Quartile
3rd
Quartile
Lowest
4th
Poverty
Quartile
Counties
Highest
1st
Poverty
Quartile
Counties
2nd
Quartile
Percent of County Population Living in Poverty
3rd
Quartile
Lowest
4th
Poverty
Quartile
Counties
Changes in County Allocation, by Percent of
County Population Living in Poverty
RISK FACTOR FORMULA
WORKLOAD METHOD
16
Number of Counties
14
12
10
8
6
4
2
Highest
1st
Poverty
Quartile
Counties
2nd
Quartile
3rd
Quartile
Lowest
4th
Poverty
Quartile
Counties
Highest
1st
Poverty
Quartile
Counties
2nd
Quartile
3rd
Quartile
Lowest
4th
Poverty
Quartile
Counties
Percent of County Population Living in Poverty
Decreased CFA
No Change in CFA
Increased CFA
Implementation Considerations
● Leaky bucket
● Receiving more state dollars may reduce county
funding
● County levy limits
● Larger burden on counties who cannot raise revenue
● Solution: “No harm” exemption
● Large fiscal impacts on counties
● Significant declines would be hard to absorb
● Solution: Gradual implementation
Recommendation
Risk Factor Formula
● Effective:
● Matches resources to need
● Data manipulation unlikely
● Equitable:
● Updated yearly
● Counties with similar poverty rates treated alike
● Low additional cost to DCF
● Counties likely will find it moderately acceptable
County Interviews and Surveys
In-person interviews with county Human Services
Departments
● 2 small (Marquette and Richland)
● 3 medium (Dodge, Rock, and Sauk)
● 2 large (Milwaukee’s BMCW and Dane)
On-line survey to all counties on cross-county
collaborations for CPS
● 11 responses from across the state
County Interviews and Surveys
Four themes from counties
1. The importance of block grants and flexibility
2. The role of local decision-making
3. Differences between BMCW and counties
4. Constraints of state mandates
Cross-County Collaborations
Suggestions for collaboration
● High-Risk or Catastrophic Case Insurance Pool
● Access and intake
● Training
● Foster care training for parents
● Specialized and high-cost services
● Use of teleconferencing for training
Cross-County Collaborations
Some counties still won’t give up local control
● Screen-in discretion
● Out-of-county institutions
● Debate over where to locate a new regional
service hub or institution
Cross-County Collaborations
How DCF can facilitate
● “Lay the groundwork” for the first meeting
● Provide information collected by DCF
● Reduce or help navigate state mandates
● If DCF provides new funds:
● Help fund portions of specialized staff
● Grants for start-up services/institutions for
multi-county collaborations
Cross-County Collaborations
Problems to avoid
● Too many changes at once
● Poor budgeting and unrealistic expectations
● Lack of buy-in among stakeholders
● Unaccountable governing bodies
Conclusion
● We explained:
● CPS demands and funding
● Two alternatives
● Themes from county interviews and surveys
● We recommend:
● DCF adopt the Risk Factor Formula
● DCF encourage and facilitate cross-county
collaboration
For further information
Contact the La Follette School’s publications office at
608-263-7657 or publications@lafollette.wisc.edu
Or see www.lafollette.wisc.edu/publications/workshops.html
Thank you
APPENDIX SLIDES
Alternative #1
Risk Factor Coefficient Summary
Risk Factors
Number of Children Living
in Poverty
Number of Children in
Single-Parent Families
Constant
Coefficients
Standard
Error
0.0795***
(0.0129)
0.0386**
(0.0157)
14.83
(19.66)
Number of Observations
72 Counties
R-Squared
0.974
*** p<0.01, ** p<0.05, * p<0.1
Source: Authors, calculated using DCF (2010) and ACS (2010) data
Estimated County Allocation per Person Under
Current Policy, by Percent of County Population
Living in Poverty
$80
R² = 0.4812
County Allocation
Per Person
$70
$60
$50
$40
$30
$20
$10
$0%
5%
10%
15%
20%
25%
30%
Percentage of County Population Living in Poverty
35%
Estimated County Allocation per Person Under
Risk Factor Formula, by Percent of County
Population Living in Poverty
$50
R² = 0.7744
County Allocation
Per Person
$40
$30
$20
$10
$-
0%
5%
10%
15%
20%
25%
30%
Percentage of County Population Living in Poverty
35%
Estimated County Allocation per Person Under
Workload Method, by Percent of County
Population Living in Poverty
$40
County Allocation
Per Person
R² = 0.2372
$30
$20
$10
$0%
5%
10%
15%
20%
25%
30%
Percentage of County Population Living in Poverty
35%
Magnitude of Changes in County Allocation
using The Workload Method, by Percent of
County Population Living in Poverty
Aggregate Change in County CFA
(in Millions)
$3
$2
Aggregate
County Increase
in CFA
$1
$0
Aggregate
County Decrease
in CFA
-$1
-$2
-$3
Highest
1st
Poverty
Quartile
Counties
2nd
Quartile
3rd
Quartile
Lowest
4th
Poverty
Quartile
Counties
Percent of County Population Living in Poverty
Note: 1st quartile are those counties with highest levels of poverty
Changes in County Allocation using Risk Factor
Formula, by Percent of County Population
Living in Poverty
16
Number of Counties
14
12
10
9
9
7
8
6
4
2
-
7
9
7
7
6
4
2
Highest
1st
Poverty
Quartile
Counties
3
2
2nd
Quartile
Decreased
CFA
3rd
Quartile
Lowest
4th
Poverty
Quartile
Counties
Percent of County Population Living in Poverty
Note: 1st quartile are those counties with highest levels of poverty
No Change
in CFA
Increased
CFA
Changes in County Allocation using Workload
Method, by Percent of County Population
Living in Poverty
16
Number of Counties
14
14
Decreased
CFA
11
12
10
8
7
8
9
8
6
6
4
2
-
3
Increased
CFA
3
1
Highest
1st
Poverty
Quartile
Counties
2nd
Quartile
No Change
in CFA
1
1
3rd
Quartile
Lowest
4th
Poverty
Quartile
Counties
Percent of County Population Living in Poverty
Note: 1st quartile are those counties with highest levels of poverty
Percent Change in CFA Funding under
Risk Factor Formula
200.0%
150.0%
100.0%
50.0%
0.0%
-50.0%
-100.0%
Percent Change in CFA Allocation under
Workload Method
200.0%
150.0%
100.0%
50.0%
0.0%
-50.0%
-100.0%
Background
Number of Reports/Cases
per 1,000 Children
● State supervised, county administered system
● Differences in demand for services
30
28.8
25
20
19.9
15.7
15
11.0
10
6.4
5
2.7
0
10 Poorest Counties
Average Report Rates
Average Investigation Rates
10 Richest Counties
Average Substantiation Rates
Background
State Basic County Allocations
(In Millions)
● Funded with state and local dollars
● Declining state revenues
● Limiting property tax levy
$300
$290
$280
$270
$260
$250
$240
$230
'05
'06
'07
'08
Year
'09
'10
'11
Estimated County Allocation per Person, by
Percent of County Population Living in Poverty
CURRENT POLICY
County Allocation per Person
$80
R² = 0.4812
$70
$60
$50
$40
$30
$20
$10
$0%
5%
10%
15%
20%
25%
30%
Percent of County Population Living in Poverty
35%
Estimated County Allocation per Person, by
Percent of County Population Living in Poverty
CURRENT POLICY
$80
$70
$60
$50
$40
$30
$20
$10
$-
RISK FACTOR FORMULA
$50
R² = 0.4812
$40
R² = 0.7744
$30
$20
$10
$0%
10%
20%
30%
$40
0%
10%
40%
WORKLOAD METHOD
20%
R² = 0.2372
$30
$20
$10
$0%
10%
20%
30%
40%
30%
40%