HOUSE BILL NO. 5025

June 16, 2021, Introduced by Rep. Hornberger and referred to the Committee on Families, Children, and Seniors.

A bill to amend 1994 PA 203, entitled

"Foster care and adoption services act,"

(MCL 722.951 to 722.960) by adding section 8e.

the people of the state of michigan enact:

Sec. 8e. (1) This section applies to children in foster care.

(2) When applying for benefits under this section for a child in foster care, the department shall, in cooperation with the child's attorney, identify a representative payee or fiduciary in accordance with the requirements of 20 CFR 404.2021 and 416.621.

(3) Consistent with federal law, when the department serves as the representative payee or in any other fiduciary capacity for a child receiving Veterans Administration benefits, federal Supplemental Security Income, or Social Security benefits, the department shall do the following:

(a) Use or conserve the benefits in the child's best interests, including using the benefits for services for special needs not otherwise provided by the department or conserving the benefits for the child's reasonably foreseeable future needs.

(b) Ensure that when the child attains the age of 14 years and until the department no longer serves as the representative payee or fiduciary, a minimum percentage of the child's benefits is not used to reimburse the state for the cost of care for the child and is used or conserved in accordance with subdivisions (c) and (d), as follows:

(i) From age 14 through age 15, at least 40%.

(ii) From age 16 through age 17, at least 80%.

(iii) From age 18 through age 20, 100%.

(c) For the child's benefits or resources that are below or not subject to any federal asset or resource limit, exercise discretion in accordance with federal law and in the best interests of the child to conserve the funds or use the funds for services for special needs not otherwise provided by the department, including choosing 1 or more of the options listed under subdivision (d).

(d) Appropriately monitor any federal asset or resource limits for the benefits and ensure that the child's best interests are served by using or conserving the benefits in a way that avoids violating any federal asset or resource limits that would affect the child's eligibility to receive the benefits, including the following:

(i) Applying to the Social Security Administration to establish a plan for achieving self-support (PASS) account for the child under the social security act, 42 USC 301 to 1397mm, and determining whether it is in the best interests of the child to conserve all or part of the benefits in the PASS account.

(ii) Establishing a plan under section 529a of the internal revenue code of 1986, 26 USC 501, for the child and conserving the child's benefits in that account in a manner that appropriately avoids any federal asset or resource limits.

(iii) Establishing an individual development account for the child and conserving the child's benefits in that account in a manner that appropriately avoids any federal asset or resource limits.

(iv) Establishing a special needs trust for the child and conserving the child's benefits in the trust in a manner that is consistent with federal requirements for special needs trusts and that appropriately avoids any federal asset or resource limits.

(v) If the department determines that using the benefits for services for current special needs not already provided by the department is in the best interests of the child, using the benefits for those services.

(vi) If federal law requires certain back payments of benefits to be placed in a dedicated account, complying with the requirements for dedicated accounts under 20 CFR 416.640(e).

(vii) Applying any other exclusions from federal asset or resource limits available under federal law and using or conserving the child's benefits in a manner that appropriately avoids any federal asset or resource limits.

(e) Provide an annual accounting to the child and the child's attorney of how the child's resources, including Veterans Administration benefits, Supplemental Security Income, and Social Security benefits, have been used or conserved in accordance with this section.

(f) Provide the child with financial literacy training when the child has attained the age of 14 years.

(4) The department shall immediately notify the child through the child's attorney of any of the following:

(a) An application for Veterans Administration benefits, Supplemental Security Income, or Social Security benefits made on the child's behalf or any application to become representative payee for those benefits on the child's behalf.

(b) A decision or communication from the Veterans Administration or the Social Security Administration regarding an application for benefits described under subdivision (a).

(c) An appeal or other action requested by the department regarding an application for benefits described under subdivision (a).

(5) When the department serves as the representative payee or otherwise receives Veterans Administration benefits, Supplemental Security Income, or Social Security benefits on the child's behalf, the department must provide notice to the child through the child's attorney of the following before each juvenile court hearing regarding the child:

(a) The date and the amount of benefit funds received on the child's behalf since any previous notification to the child's attorney.

(b) Information regarding all of the child's assets and resources, including the child's benefits, insurance, cash assets, trust accounts, earnings, and other resources.

(6) This section does not affect any additional notice required by a state court.