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09/05/2021 ARPA funds can be used to assist young adults transitioning out of foster care

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The COVID-19 pandemic has put stress on all of us, and some of us, including young adults transitioning out of foster care, were already living under incredibly trying conditions. 

Eighteen-year olds with few family supports and resources are expected to secure housing, a job, and live independently, often with little preparation. Teens who age out of foster care often experience homelessness, unemployment, and poverty. The National Foster Youth Institute estimates that one-quarter of youth formerly in foster care experience homelessness within four years of aging out of the child welfare system and are arrested within two. About half of youth emancipated from foster care have chronic health conditions like asthma, post-traumatic stress, malnutrition, and dental decay and up to one-third lack health insurance. Fewer than five percent will earn a bachelor’s degree. 

Early in the pandemic, a poll of 172 youth formerly in foster care  aged 18-24 by the nonprofit Foster Club showed that more than a quarter were suffering from food insecurity. Nearly 40 percent of respondents had been forced to move or feared having to do so. Twenty-seven percent had been laid off because of the pandemic, while another 40 percent had their hours severely cut or saw a decrease in gig work. 

Federal lawmakers recognized this need when they created the American Rescue Plan Act (ARPA), the $1.9 trillion pandemic relief package signed into law in March. The law gives young adults age 18-24 who were formerly in foster care access to the Earned Income Tax Credit (EITC) for one year. The tax credit lets people who are working full-time, but earning less than $21,000 annually, claim up to $1500 in federal tax benefits. Prior to ARPA’s passage, childless adults up to age 25 were not eligible for the credit. 

Here in Massachusetts, approximately 900 young people age of out the foster care system each year. HopeWell has the capacity to work with about 30 of them annually with My First Place™, an education and employment program that provides free housing to youth and intensive case management to assist young people as they develop the skills to successfully transition to self-sufficiency. For most of these young adults, access to the EITC will help enormously. 

But so much more can—and should—be done. 

Massachusetts has received $5.2 billion in ARPA funds and has until 2024 to spend the money. Separately, municipalities received $3.4 billion to share. Gov. Baker has already allocated some ARPA funds to municipalities that were previously denied federal relief funding and to fund a vaccine lottery. The legislature launched a series of public meetings in July to hear ideas for how Massachusetts should spend its remaining funds. Cities and towns around the Commonwealth are doing the same. 

Here are some of our ideas. 

First and foremost young adults formerly in foster care need cash, as the federal government clearly recognized with the expansion of the EITC. Because they so often lack the support of parents or other adult family members, transition-age youth don’t benefit from things like parental loans or gifts that enable young adults to rent and furnish an apartment, go to college, or purchase a reliable car for work. There are few people they can rely on in a crisis such as a pandemic. Respondents to the Foster Club survey talked of rationing food, running out of food, being denied food stamps, and having to borrow money and food from others during last year’s shutdown. Using ARPA funds to provide transition-age youth with a Universal Basic Income (UBI)—monthly, no-strings-attached cash payments—would go a long way toward easing stressors related to costs associated with aging out of foster care and achieving self-sufficiency. 

UBI is an anti-poverty measure that has gained traction in the COVID-19 era due to widespread unemployment, and results from pilot programs in places like Stockton, CA are showing positive impact such as increased full-time employment, improved financial stability and overall well-being. Participants in the $500-a-month, two-year program spent much of the money on necessities like food, utilities, hygiene products, and auto costs. A program in Finland showed similar results. Closer to home, the cities of Cambridge and Chelsea are currently piloting UBI programs to offset the effects of the pandemic on low-income families. 

Even better, Los Angeles County has just approved a UBI program geared explicitly toward former foster youth. The planned program will give $1200 a month to 150 young adults aged 18-24 who have nowhere else to turn for assistance. Jacqueline Robles, a 22-year-old who hopes to be selected for the program, described graduating from college and being emancipated from care just as the pandemic hit last year, leaving her at risk of becoming homeless. UBI, she said, “definitely allows you to relieve that financial burden that foster youth often face with lack of family support, that my peers may have that I wouldn’t.” 

As Robles’ story illustrates, youth formerly in foster care need access to housing. ARPA funding could be put to good use to create low-cost housing options for transition-age youth. In Wisconsin for example, Mayor Satya Rhodes-Conway has earmarked more than $6.5 million of the city’s ARPA allotment to expand affordable housing options explicitly for youth aging out of foster care, among others. We’d love to see local mayors follow suit. 

The Commonwealth could also infuse existing programs for transition-age youth with ARPA funds to expand their capacity. Take, for example, the state’s Foster Child Grant Program, which provides grants of up to $6000 per year up to five years to help foster children pay tuition at a college or university of their choosing. While that’s a generous sum, given the cost of a college education today, increasing the size of the grants with ARPA funds would further defray expenses and student-loan debt for former foster youth. Likewise, the state could increase grants made through the Education and Training Voucher Program, which provides financial assistance for transition-age youth enrolling in post-secondary education and vocational training. 

Massachusetts also has a State College Tuition and Fee Waiver Program, which waives tuition for youth formerly in foster care who attend public universities and community colleges. The waiver doesn’t currently cover books or room and board. ARPA funds could be used to fill that financial gap and provide more stability for former foster youth, thereby increasing their chances of success. 

The pandemic has laid bare systemic inequities based on race, sexual orientation and gender identity, and family status. It’s up to us to change these systems and ARPA funds provide an opportunity to do so now.

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