Bill Clinton made welfare reform a major campaign issue in 1992, part of his agenda to “reinvent government.” Candidate Clinton’s book, Putting People First, promised to “provide opportunity, demand responsibility, and end welfare as we know it.” But while Washington has a key role to play, the most important reforms in social welfare policy will have to take place at the state and local levels. Nowhere is the issue more pressing than in New York City. With 3 percent of the nation’s population, the city has 7 percent of its welfare population, 12 percent of its foster care population, and a large but unknown percentage of its homeless. Is the city’s Human Resources Administration (HRA), its principal agency for providing services to the poor, up to the job? Unfortunately, HRA’s recent performance suggests the answer is no.
HRA serves 1.5 million New Yorkers and has an annual budget of $7.3 billion, or 22 percent of the city’s total expenditures. With almost thirty thousand employees, the second-highest payroll among mayoral agencies (after the Police Department), and a budget larger than those of many countries, the agency has considerable opportunity to improve the way in which it serves its clients and to reduce the enormous costs of social services in the city.
A “superagency,” the Human Resources Administration was created by Mayor John Lindsay in 1966 with the aim of providing services for the poor more effectively by integrating them into one agency. Its mission is “to plan, initiate, conduct, supervise, coordinate, review, and evaluate city programs and activities in the attack on poverty.” While HRA carries out some of its many tasks fairly efficiently, it has never fulfilled the goal that led to its creation. Two of HRA’s most important problems over the past four years have been the almost total dissolution of the staff and departments within the agency responsible for planning and analyzing programs, and the lack of commitment to the basic precept of welfare reform—getting clients out of the system rather than perpetuating their reliance on it.
The effectiveness of an agency like HRA cannot be measured on the basis of “inputs,” such as how many people are served or how much money is spent. Rather, the agency must develop ways of gauging “outcomes”—the degree to which its efforts are actually serving the public purposes they are designed to advance. David Osborne and Ted Gaebler make the point succinctly in their book Reinventing Government: “If you don’t measure results, you can’t tell success from failure.”
Under the Dinkins administration, however, HRA has systematically dismantled its capacity for strategic planning, evaluation, and rational program development, created under Mayor Lindsay and maintained during several succeeding administrations. Not only have the accumulated findings of past research been ignored, but the organizational structure and staff required to diagnose systematic problems and to plan, monitor, and evaluate programs have been disbanded. Early on, faced with the prospect of retrenchment, HRA decided to cut “auxiliary services” staff, such as policy analysts, rather than those who directly serve clients. In theory, it was sacrificing “middle managers” in favor of those who actually give help to the needy. In reality, providing social services, especially in times of economic distress, is among the most complex challenges facing government. By cutting the thirty to fifty analysts (out of a total staff of some thirty thousand) who comprised the core analytic staff, the agency realized trivial short-term savings but will incur enormous long-term costs, both financial and social.
One of the many serious consequences is that no one is assessing service impact and quality control has been seriously undermined in the more than 1,800 HRA contracts with private social-service providers. Through these contracts, worth about $1.25 billion, HRA provides services ranging from foster care and day care to job training and attending the homebound. Staff members in the HRA Child Welfare Administration, for example, had been attempting to monitor the performance of contract agencies receiving millions of dollars for services to children. Not only were they pulled off their audit duties, but they were left idle for months. The staffers were reassigned when the story was exposed in the press, but the monitoring was never resumed.
The effectiveness of HRA’s programs has a profound impact on the lives of poor New Yorkers. While the government cannot eliminate poverty, child abuse, or homelessness, it could do a great deal to lessen these problems. And the size of the agency’s caseload has substantial implications for the city’s budget. Between 1989 and 1992, while many city services were being cut back in response to a budget crunch, HRA’s annual budget increased by one-third, or $1.7 billion.
Without HRA’s planning and analytic staff, it is also impossible to know how its policies affect the size of its caseload. HRA can exert considerable influence over how many people enter the city’s social-service system, what happens while they are in the system, and how quickly they get out. In other words, HRA’s caseload is dynamic. Between 1987 and 1990, for instance, HRA reduced the daily census of families in homeless shelters from 5,200 to 3,600, not by reducing the number of people coming into the system—indeed, it went up from 450 to 750 a month between 1986 and 1989—but by speeding their resettlement into permanent housing.
It is impossible to manage such dynamic caseloads effectively without a strong analytic capability. Policy-makers must be able to track, interpret, and project trends, and to evaluate the results of innovations in their programs. Four years ago, HRA had a highly trained and experienced central policy and program development staff, which supplied top decision-makers with a steady flow of studies, analyses, and well-documented plans that helped manage and even reduce caseloads. Ironically, they also helped the agency make and defend its claim for resources in the city budget process. Today, only a skeleton crew remains. Similarly, most policy analysts within the operating departments of HRA have been fired, or their work ignored.
The Dinkins administration has made substantial changes in HRA policy, particularly involving HRA’s two largest departments, Child Welfare and Income Maintenance (welfare). Because HRA’s analytic capacity has been gutted, it is impossible to evaluate these changes fully. But from the limited data that are available, one can get a picture of what is wrong at HRA.
HRA has made Child Welfare its primary area of focus during the Dinkins administration. Its efforts have concentrated on “preventive” services, especially the Family Preservation Program. The notion behind the program, announced with considerable fanfare but little planning, was that by offering intensive counseling and other services in an effort to keep troubled families together, the agency would be able to reduce foster care and other services for children. Assuming that intensive services work, they are still very expensive, so their potential for cost-effectiveness depends on the agency’s ability to predict correctly which families are at greatest risk of dissolution. HRA has no independently validated criteria for targeting those intensive services.
While HRA has promised that “outcome measures” would finally appear in the September 1993 Mayor’s Management Report, the only information now available concerns the number of families being served. In 1989, HRA staff and its contract agencies were providing 30,128 families with preventive services, while in 1992, such services had been reduced by almost 10 percent, to 27,594 families. In 1992, only 91 families were receiving help through the Family Preservation Program, and only 174 families were to be in the program in fiscal 1993.
The effectiveness of preventive services either in avoiding the need for foster care or in substantially helping troubled families is questionable. HRA has never conducted an evaluation of its $40 million investment in preventive programs. Information about even such basic matters as the nature and length of services is strictly anecdotal. The agency has abolished its quality control unit, and the position of assistant deputy commissioner for policy and planning within Child Welfare has been vacant or staffed by an “acting” official for most of the past four years.
HRA’s preventive-services centerpiece, Family Preservation, has been systematically evaluated in Illinois and elsewhere. It has shown no impact in reducing foster care. And in New York, the number of children in foster care increased from 34,881 in June 1989 to a high of 49,814 in 1991. As late as September 1992, HRA projected a foster care caseload of 55,898 for fiscal 1993. There is some evidence, however, that the caseload has finally stabilized. It is probably more than coincidental that the crack epidemic that fueled the rise in caseloads during the 1980s has also leveled off.
The increase in the foster care caseload is largely due to the creation and rapid expansion of the kinship foster care program, which was nonexistent in 1986 and now enrolls more than 21,000 children, or about 40 percent of the total foster care caseload. Kinship foster care was designed with the good intention of keeping families together by placing children of abusive or neglectful parents with close relatives such as grandparents or adult siblings. It has been heartily embraced by HRA and most child advocate groups as a more humane alternative to traditional foster care. Unfortunately, the program is also subject to abuse. Because relatives in the kinship foster care system receive substantially higher benefits than if they were on welfare, poor families have an incentive to enter the system even if foster care is not really needed. Foster care payments start at about $580 per month per child and can go as high as $1,100 per month, while welfare pays about $180 per month plus Food Stamps.
Kinship foster care thereby risks undercutting the primary goal of foster care—either to reunite children with their birth parents or to ensure a speedy permanent adoption. By encouraging the formation of families headed by a relative who is not a child’s parent, kinship foster care may well end up driving the mother from the home as welfare did the father. In fact, the average time children spend in foster care has increased by one-third, from 2.1 years to 3.25 years. But because of HRA’s inability to gather or analyze information about these programs, we have no way of knowing for sure what the results of kinship foster care have been, apart from anecdotes of systemic abuse and the alarming increase in the length of time children stay in foster care.
A few other data are available regarding HRA’s Child Welfare services, and they are not encouraging. It is true that within recent months foster care enrollment has dipped a little. But the evidence suggests this trend reflects not a decline in need, but a decline in the quality of Child Welfare’s protective services. Between June 1991 and April 1993, the number of caseworkers dropped from 1,152 to 745, despite an increase of almost 20 percent in the number of highrisk cases reported to HRA between 1989 and 1992. Correspondingly, the two standard measures of caseworker activity both went up unconscionably. The number of new cases per caseworker went up from 5.6 to 7 per month (specialists place the appropriate number at between 4 and 6), and the average caseworker’s load increased from 16.3 to 22.3 cases (the standard is between 12 and 18). Thus, caseworkers were trying to handle a greater number of more difficult cases, while HRA argued with city budget officials about why more than three hundred authorized caseworker positions went unfilled.
As a result of the decline in the number of caseworkers, the number of cases in which sufficient evidence was gathered to require the full-scale investigation that must precede the placement of children in foster care went down by 25 percent. During this time, the number of Family Court petitions filed by HRA attorneys—the precursor to a finding of abuse or neglect—dropped a dramatic 40 percent, from 11,173 to 6,873, perhaps because of backlogs brought on by staff attorney vacancies.
Given the greatly reduced number of cases coming into the system, the number of children in foster care should be substantially below what it is now, even taking into account the longer periods of time children are in foster care. Could it be that substantially more parents are voluntarily placing children in foster care because they want to take advantage of the kinship foster care reimbursement rates? Again, the only evidence available is anecdotal. The agency no longer has the staff to study and explain these results, but that does not stop HRA from claiming an “increased impact of the Family Preservation Program.”
In the early 1970s, almost one-third of the welfare recipients in New York City were legally ineligible for benefits. Later in that decade, significant strides were made in enforcing eligibility requirements. By the early 1980s, the proportion of those on the rolls who should not have been was reduced to around 5 percent. Accordingly, the welfare caseload shrank from about 1 million to about 800,000, even in the face of a recession.
Today, for the first time since 1976, the welfare caseload exceeds a million; it is at the highest level in history. The dramatic increase is clearly tied to the national recession. Since 1989, the nation’s welfare caseload has risen by about 27 percent, roughly the same as New York City’s.
The lack of analytic information coming out of HRA makes it difficult to determine whether other factors are significantly driving the numbers upward. (HRA has not provided extensive information about welfare and poverty levels since June 1989, when it last issued its widely respected analysis of New York City economic and social data, entitled Dependency.) Based on available information, however, there do not appear to have been any significant changes in the way the system is processing applicants and determining welfare eligibility. Rejection rates for those seeking benefits have remained constant over the past four years, and error rates—the number of people on the rolls who should not be there or are getting the wrong benefits—are basically unchanged (5.7 percent in fiscal 1989 and 5.5 percent in fiscal 1992). The average length of time a client spends on welfare also affects caseload increases, but HRA no longer provides systematic information about this.
While HRA has held a steady course in maintaining eligibility requirements, it has not succeeded in getting people off the rolls and into jobs. Historically, the city’s employment and training efforts on behalf of welfare recipients have been relatively ineffective. In part, this was because responsibility for employment efforts has been divided between HRA, the state Department of Labor, and the city Department of Employment, leaving no single agency accountable. A more fundamental problem, however, has been the city’s lack of commitment to sound programming that would make employment and training real alternatives to welfare.
In 1988, Congress passed the Family Support Act, providing the city with a new opportunity to fashion a strategy aimed at making welfare a way station to employment rather than an end in itself. The act gave states financial incentives to place clients in jobs or training programs, and the city initially responded. By the end of 1988 the city had developed a comprehensive plan to refashion the welfare system around the mutual obligations of the welfare client and the government: the client had the obligation to do whatever she could to improve her employability, and the government had the obligation to help the client do this. But the effort at systemic reform ended with the election of Mayor Dinkins, and the city is back to business as usual.
Currently, HRA’s primary concern is with meeting federal and state requirements for placing clients in job training, not with ensuring that those clients find and retain employment over the long term. Thus, HRA churns clients around in the system; hundreds of thousands are interviewed to assess their eligibility for and interest in employment, but the process typically goes nowhere.
While HRA makes modest efforts at encouraging clients to search for jobs, the agency much prefers training and remedial education. So do the clients—quite rationally, as anyone who has ever looked for a job will understand. In fiscal 1992, 39,020 recipients of Aid to Families with Dependent Children (AFDC) were enrolled in training (although individuals enrolled in more than one program were counted multiple times), and 22,141 more clients were participating in some other employment-related activity, usually job search or work experience of some kind. But training and remedial education are notoriously weak reeds on which to base an employment strategy. The quality of the programs is often poor, and most participants go from training program to training program without ever graduating to a job.
HRA takes the paternalistic view that AFDC recipients need a lot of assistance and support—especially remedial education, training, and day care—before they can function in the labor market. Low-wage jobs are looked down on as a “dead end.” And there is a heavy emphasis on assessment for readiness to work, with the process built around finding reasons to exclude clients rather than figuring out how to overcome such obstacles and include them. The result is often that those who could find work on their own get the most institutional attention and probably are delayed from actually getting jobs. At the same time, those who could benefit most from concerted prodding and encouragement are left by the wayside. All women on welfare with children over three are required by federal law to participate in employment and training activities. But HRA has effectively made such participation voluntary.
In this area, too, HRA no longer conducts a systematic analysis of its efforts. But it is possible to get a rough idea of HRA’s performance in fostering employment by looking at the available data. In fiscal 1993, HRA projects that its efforts will result in about 9,800 AFDC recipients, or about 2.4 percent of the total AFDC caseload, getting jobs. This performance can be compared with those of several counties where sophisticated research has shown that effective employment and training initiatives can make a significant difference in reducing welfare costs and increasing employment among welfare recipients. In 1991, Riverside County, California, with an AFDC caseload of about 28,000 and an unemployment rate of 9.8 percent, reported 7,751 job placements, or about 28 percent of the total caseload. In the same year, San Diego County reported placing about 9 percent of its clients in jobs. And in Kent County (Grand Rapids), Michigan, which had a caseload of 8,181 in June 1991, 1,774 clients, or 21 percent, found employment.
There is a sufficient body of knowledge about what works that HRA could build a more effective employment program if it had the will and the planning capacity to do so. A modestly effective program in New York City should be able to place between thirty thousand and forty thousand AFDC recipients a year, or about 10 percent of the caseload, into jobs, instead of the pathetic 2.4 percent the city currently achieves.
Given HRA’s disappointing record on welfare reform and the historical reluctance of the city’s powerful public employee unions to countenance public-service jobs for welfare recipients, it is hard to envision how President Clinton’s expressed idea—two years on welfare and out—could work in New York City. A cynic might postulate that HRA’s response will be to spend two years assessing the employment potential of its clients and then put their children into kinship foster care.
There has been no shortage of plans for reforming HRA. Since the agency’s founding, as many as 15 different commissions and study groups have come up with various reorganization schemes, based on one of two alternatives: breaking HRA into multiple agencies, each with a single purpose, or decentralizing the agency and providing services at the neighborhood level.
Several single-purpose agencies have already been created. The departments of Employment, Juvenile Justice, Aging, and Homeless Services were all formerly part of HRA. This approach ignores the reason the city created a “superagency” in the first place: to integrate the planning and provision of social services. The new Department of Homeless Services, for example, will have to coordinate its efforts with those of HRA, which determines income eligibility for welfare, and the city’s housing agencies, which are responsible for placing the homeless in permanent housing. The only immediate value of creating a new agency would seem to be political. Accountability will be suspended for about a year while the new agency gets organized, and after that it will be another year before measurable accomplishments can be expected.
The idea of decentralization hearkens back to the original structure of HRA, which supervised “community corporations” in each of 28 poor neighborhoods. These corporations, however, got caught up in the politics of poverty and in romantic notions about “empowering” the poor; they died a painful death in the 1970s amid charges of profiteering and ineffectiveness. The idea that decentralization is the key to effective service had become policy before a more fundamental question was answered: What are the needs of HRA’s clients?
Addressing such basic questions remains crucial today. HRA’s failure to develop and implement rational and effective policies on foster care and welfare is largely the result of its failure to plan and analyze its programs effectively. Designing and carrying out effective social-service policies would be a challenge even for an organization blessed with state-of-the-art strategic planning and management capacity. At HRA, however, the staff and systems capable of carrying out this mission have atrophied from abuse and neglect. The pattern is analogous to a jumbo jet pilot, flying in stormy weather, who responds to a fuel shortage by turning off the radar to save gasoline.
Good intentions are not enough to meet the demands of HRA’s complex and dynamic caseload, to move the city into the mainstream of reducing rather than maintaining dependency, and to monitor and assess what does and does not work. HRA needs to build upon existing knowledge and develop a competent and creative analytic staff—in effect a guidance system—that can help the agency serve the poor more effectively and credibly demonstrate whether its efforts are successful. At the moment, HRA is flying blind.