IMPLEMENTATION OF THE STATE

LEGALIZATION IMPACT ASSISTANCE

GRANTS UNDER THE IMMIGRATION

REFORM AND CONTROL ACT OF 1986

COLORADO 
STA TE  OF 
1t"diO 
OFFICE OF INSPECTOR GENERAL 
OFFICE OF ANALYSIS AND INSPECTIONS 
OCTOBER 1989  ,:'
OFFICE OF INSPECTOR GENERAL

The mission of the Offce of Inspector Genera (DIG) is to promote the effciency, effective
progrs 
ness, and integrty of  in the United States Deparent of Health and Human Ser
vices (HS). It does this by developing methods to detet and prevent fraud, waste, and 
abuse. Created by statute in 1976, the Inspector General keeps both the Secreta and the Con
gress fully and curently informed about programs or management problems and recommends 
corrctive action. The OIG perform its mission by conducting audits, investigations, and in
sta 
spections with approximately 1 300  strategically located around the countr. 
OFFICE OF ANALYSIS AND INSPECTIONS 
This repon is produced by the Offce of Analysis and Inspections (OAI), one of the thee 
major offices within the DIG. The other two are the Office of Audit and the Offce of Investi
gations. Inspections are conducted in accordance with professional stadads developed 
OAI. These inspections are tyically shon-term studies designed to determe program effec
tiveness, efficiency, and vulnerabilty to frud or abuse. 
This study was conducted to determne the effectiveness of Colorado s implementation of 
State Legalization Impact Assistance Grants funds awarded under the 
Immgration Reform 
and Control Act of 1986. 
The repon was prepared under the dition of Don McLaughlin, the Regional Inspector Gen
eral of Region VII, Offce of Analysis and Inspections. Parcipatig in this project were the 
following people:

Kansas City  San Francisco 
Project Leader  Apryl Williams 
Hugh Owens, 
Raymond Balandron 
James Wolf 
Alicia Smith 
Headquarters  New York 
Alben 1. Nace  Lucile M. Cop 
Debra Robinson  IMPLEMENTATION OF THE 
STATE

LEGALIZATION IMPACT ASSISTANCE

GRANTS UNDER 
THE IMMIGRATION

REFORM AND CONTROL ACT OF 1986

COLORADO 
STATE  OF 
Richard P. Kusserow 
INSPECTOR GENERAL 
OAI-07 -88-00443  OCTOBER 1989  EXECUTIVE SUMMARY 
PURPOSE 
The purose of ths inspection was to determe how effectively Colorado implemented the 
State Legalzation Impact Assistace Grants (SLIAG) program, to identify potential problems 
early in the process, and to identiy goo practices which  could share. 
al States 
BACKGROUND 
progr 
The SLIAG  was established under the Imgration Reform and Control Act (IRCA) 
of 1986 to reuce the fmancial burden of providig public assistace, public health assistace, 
and educational servces to eligible legalze alens. In Fiscal Year (F) 1988, $928.  mion 
progr  wi 
in  funds were alocated to States, and funds  contiue to be alocated though FY 
1991. These fuds also cover admstrtive costs for implementing SLIAG at the State and 
local levels. Payments ar made for public assistace activities generaly available to 
neey individuals and publi health assistance servces offered under the States' public health 
progrs. The payments also cover educational servces designed to assist eligible legalze 
alens to attai a satisfactory level of performce in school and to achieve English language 
proficiency and citizenship skis necessar to become permanent residents. The Famy 
adsterig  progr. 
Suppon Admnistrtion (FSA) is responsible for  the 
Because SLIAG was a new progr, FSA realze that problems would surace early in its 
implementation. In addtion to the norm diculties encountered in cratig new processes 
and proedures, FSA recognized that SLIAG would have unque problems. Some of these 
issues include the diversity of program which SLIAG encompasses, cultu and language 
barers associated with the servce population, maitaning confdentialty of informtion, and 
fres 
the extremely short time  for the  process. 
grt award 
METHODOLOGY 
In response to the anticipated diculties with implementing SLIAG, FSA requested that the 
Offce of Inspetor General (OIG) conduct reviews in 10 States to determne the progress of 
States ' implementing this progr. The FSA selected nine States and the Distrct of Columbia 
because of the varety of program they offere the number of eligible legalized aliens in the 
population, or the amount of the grant. The nine States are Arzona, California, Colorado, 
Florida, Ilois, Massachusett, New York, Texas, and Washington. 
strctu 
Intervews based on  discussion guides for each major program ara, as well as 
documentation fuished by FSA and State and local offcials, built the base of information for 
this report. Ths report represents the review conducted in the State of Colorado and reports 
on its implementation of the SLIAG program as of August 1988.  Both FSA and Colorado were commtted to identifying problems and developing innovative 
and effective solutions for them. Imedately following our on-site visits, FSA was given an 
outline of the State concerns identied in ths report 
FINDING:  FSA ha held national conferences and issued informtion to States 
Since  1987.
on imlementing the SUAG program. 
The FSA held several national conferences begining in 1987 to share 
inormation with States on SLIAG legislation, the implications for States, the 
application process, and the documentation of costs. 
The FSA also provided States with "Question and Answer" issuances and 
demographic data from the Imgration and Natulization Servce (IS). 
FINDING: Colorad established a strctue to identify organizational and program needs. 
Thugh a Medical Case Management Progr, the Colorado Deparent of 
Health intends to elevate the health status of needy individuals to approximately 
that of the State s general population. 
hi, 
The Colorado Deparent of Health also intends to recrit,  tr, and 
supervse parprofessional communty health workers who are ethcaly, 
liguisticaly, and cultually sensitive to its servce population. 
Agencies seekig to provide SLIAG-related educational servces for eligible 
legalze alens must develop outreach activities and identiy these in their grant 
proposals to the Colorao Deparent of Education. 
FINDING: Colorad also took steps to document exenditures and contrQI disbursements. 
At the tie of the inspection, Colorado was adapting existing automated systems 
to reimburse counties for cash and medcal assistance to eligible legalzed alens. 
Since expenditues must occur before reimbursement is made, the system used 
will show whether any excess cash balances exist at the service provider level. 
Under funding agreements with the Colorado Deparent of Education 
educational providers must separately account for SLIAG 
expenditues before 
reimburement is made. These agencies must collect and report data veriying  enrollment, attendace, progress, certfication, and program expenditus to the 
deparent. 
Neverteless, there are some funds contrl vulnerabilties. 
FINDING: Conflicting interpretations of the term "public charge" ha caused uncertainties 
for the aliens as to what services they are entitled to receive without 
fear of deportation. 
Some members of the alen population fear that acceptig benefits would subject 
them to possible deporttion if they ar identied as a "public charge," as 
defied by the INS. Ths uncertnty ultitely affects the State s abilty to plan 
for and provide servces to eligible legalze alens. 
FINDING: The State ha not developed a method to determine education program 
adinistrative costs. 
FINDING: The FSA application review process created a numer of signifcant problems for
Colorad. Also, the FSA's application review process interfered with the State s ability to plan 
for services.

Delay in FSA issuig the implementig regulation resulted in the State 
inabilty to properly plan for SLIAG. 
Numerous policy misinterpretations and disagreements resulted because FSA 
did not provide definitive wrtten instrctions to assist Colorao in 
understadig SLIAG application requirements. 
The tie frames were too short for submittg the intial SLIAG application 
FSA review and comment, and revisions of the application. 
No formal appeals process exists if.progrs or costs ar denied in the fIrst level 
review. 
As mentioned earlier, FSA and Colorao have aleady initiated action on some of the 
recommendations made in this report. Steps have been taen by FSA to provide States with 
more specific, formal guidelines for identifyg and documentig actual program and
admistrative costs. However, additional actions ar necessar in other areas on the par of
FSA and Colorado.  RECOMMENDATION: The FSA and the INS should further clarify what is meant by
public charge" and widely disseminate this informtion to the aliens who have raised 
concerns about their resident statu. 
RECOMMENDATION: The Colorad Department of Education should ensure that 
providers of educational services are properly calculating education program adinistrative 
costs. 
RECOMMENDATION: The FSA should make its application and grant process more 
orderly. Specifcally,  SA should

provide defitive wrtten instrctions on the SLIAG application requirments 
and establish a dialogue with Colorao on SLIAG policy, compliance, and 
reportg issues to miime the confsion that occUIed in the intial application 
process; 
tie 
ensur that sufficient  is alotted to the application process includig 
Colorado s intial application, FSA' s review and formal comment, Colorado 
consideration of FSA comments and negotiation of disputes, and its submission 
of the revised application for FSA approval; and 
develop an appeals process to use if programs or costs associated with providig 
servces are denied in the intial application proess. 
COMMENTS 
drt 
The FSA and the State of Colorao both commente on the  report They generay 
agree with our fmdigs and recommndations. Both reported havig taen a number of steps 
to improve implementig SLIG. Their comments are included as appendices B and C, 
respectively.  ....... .........  ...... ........ .............................. . 
TABLE OF CONTENTS 
EXECUTIVE SUMMARY

I NTROD U CTIO N ................ .... ......... ............ .... ...... ..... .................8118........ ....... ... 81D...... 8 1

COLORADO' S ORGANIZATIONAL STRUCTURE................................................ 3

FINDINGS AND RECOMMENDATIONS ...................0......................................e....... 4

Pu bl i c Assistance ... 
II II.. II II.. II II.. II II ... II  II... II ... II II.. II... II II." II... II ... II ... a... II II... IIII I
I. II II.. II II II.. II 

Pu bl ic Health Assistance .... .... .... II.. .... .... II... II II.. II II.. II II.. II ... II II.. II..a.. 1111II1..1.
 II ... II.. II II... II 9

Ed ucati on ... II....11.. II ....... ..... I.I...... II..II II.. II II  II".. II II.. II II.. II... IIII. ... I1I1 ..
11... II ... II II.. II 12

Crosscuttin 9 Issues ...  ................. ........ .... 15

..... II  II
 II II.. II II.. 
OIG RESPONSE TO COMMENTS ..........................................................e............... 18

APPENDICES

APPENDIX A: Good Practi ces Ii ....... ..... .... ... II...... ..11... ..1111.11.. .... ..1111.....a....... A

APPENDIX B: FSA's Comments .........UI........................II..............._..... B

APPENDIX C: Colorado s Comments..........................................C-1
 INTRODUCTION

PURPOSE 
The Famy Support Admstrtion (FSA) requested that the Offce of Inspector General 
(OIG) conduct an inspection in nie States and the Distrct of Columbia to determe the 
effectiveness of the States' implementation of the S tate Legalzation Impact Assistace Grants 
progr  Imgrtion 
(SLIAG)  awarded under the  Reform and Control Act (lCA) of 1986. 
The inspection included reviewig mechanisms in place to identify these funds and
determg 
whether present or projected policies and proedures adere to FSA gudelies.
identig 
The FSA also was interested in  potential problems early in the process and goo 
ppraectrictegs w hich al States could shar. Ths report presents the results of the inspection
to the State of Colorao. 
BACKGROUND 
Under IRCA. eligible legalze alens may apply for permanent residency within a I-year 
period afer they are flIt eligible (Le., by the 31st month after they receive temporar resident 
status). 
wi 
Ths new population  incrase the demand for State public assistace and public health 
wi 
assistace servces signcantly. It  also incrase the demand for State educational 
obta 
servces as these new residents  English language and civic skis needed to become 
S. citizens. 
To help States defray many of the costs of providig public assistace, public health assistace 
and educational servces to eligible legalze alens, IRCA authorized $1 bilon each year 
(F 
frm Fiscal Years  1988 though 1991 for SLIG grts, less an amount identied as the 
Federa offset." With few exceptions, eligible legalze alens ar ineligible for federaly 
progrs 
funded public assistace  such as Aid to Fames with Dependent Chidren (AFC), 
foo staps, and Medcaid. The "Federa offset" is the estimated cost to the Federa 
Governent of providing these servces or benefits to those few legalize aliens who ar 
eligible for them. In FY 1988, the law  mion 
allocate $928.  to States. 
To receive SLIAG fuds, States must apply to the FSA Division of State Legalation 
Assistace, which is responsible for approvjng applications and adnistering the program. 
The application must be approved in tota for a State to receive any SLIAG funds. The FSA 
also provides States with technical assistance on policy issues and on the methods used to 
determne costs and verify actual costs.  The basic requiment for States to claim reimburement is that costs must be alowable, 
reasonable, and allocable. State public assistance and public health assistance program must 
be the same ones available to the general public. States cannot create new program in these 
areas specifcaly for eligible legalze aliens. However, States may create new or additional 
progrs  clai 
education  for the eligible legalzed alen population. States may also 
reimbursement for progr adstrtive and SLIAG admstrative costs. 
Reimburement for public assistace and public health assistace is lited only to the amount 
maum 
of State and local funds expended for SLIAG-related costs. The  SLIAG 
reimbursement for educational servces is an average of $500 per year per eligible legalze 
alen. Determg progr adistrtive costs should be made in accordace with the fial 
reguation at 45 CF 402.22. 
adsterig 
The FSA is responsible for  the program Because SLIAG was a new program, 
real 
FSA  that problems would surace early in its implementation. In adtion to the 
norm diculties encountere in creatig new processes and proedures, FSA recogned 
that SLIG would have unque problems. Some of these issues include the diversity of 
progrs which SLIAG encompasses, cultual and language barers associated with the 
tie
servce population, maitaing confidentiity of information, and the extrmely short 
fres 
for the grant award process. 
METHODOLOGY 
nie 
The FSA selected  States and the Distrct of Columbia for the inspection because of the 
progr 
varety of  offered, the number of eligible legalze aliens in the population, or the 
amount of the  nine States are Arona, Calornia, Colorado, Florida, llinois, 
grt. The 
Massachusetts, New York, Texas, and Washigton. This report reviews Colorado 
progr as of August 1988. 
implementation of the SLIAG 
strctu 
Pror to conductig the inspetion, the OIG developed  discussion gudes for each 
major program activity at the State and local levels. In conductig this review, intervews 
were held with offcials from public assistace, public health, and education.  COLORADO' S ORGANIZATIONAL STRUCTURE

In the State of Colorado, the Governor has designated the Colorado Deparent of Social 
adisterig  progr. 
Servces as the responsible  agency for the SLIAG  Under the 
designation, the executive ditor of the Colorado Deparent of Social Servces is 
authori 
specifcaly  to apply for and accept SLIAG funding and to provide assurces and 
certcations, as reuired by Federal regulations, to the U.S. Deparent of Health and 
Human Servces. With the Colorado Deparent of Social Servces, the executive dictor 
has designated the State Coordinator of the Colorado Refugee and Immgrant Servces 
Prgram as the single point of contact. 
acl 
The Colorado Deparent of Social Services  ters the State s public assistance 
progr 
though the county Deparents of Social Servces. Other program admnistered 
by the Colorado Deparent of Social Servces ar the Medcaly Indigent Progr, 
Medcaid, public assistace programs, and the Systematic Alen Verification for Entitlements 
Prgr 
system. The Medcaly Indigent  is cared out thugh provider contracts. 
The Colorado Deparent of Health has entere into a cooperative agrment with the 
Colorado Deparent of Social Servces to provide public health plang, coordiation
adstration, 
deliver, Medcal Case Management, and Medcaly Indigen  voucherig 
progr. 
servces, under the SLIAG  Simarly, the Colorao Deparent of Education has 
entere into a cooperative agrment with the Colorao Deparent of Social Servces to 
provide services under the SLIAG program Such services include education planning, 
coordiation and adstration, and contracts for adult education servces and elementar 
and seconda education servces conducted by local education agencies. 
Colorao intends to use existig servce delivery and fundig mechansms, and to use 
providers of servce to accommodte the nees of the eligible legalzed alens. The 
avaiabilty of those servces ar lited to those generay available to other Colorado 
residents. 
identi  legald 
Parcipatig servce providers must be able to  eligible  alens except where 
Federa reguations permt establishing costs on the basis of a ratio between the State s tota 
population and the number of alens in the State. The exception primarly relates to public 
health servces. As far as public assistace and education ar concerned, Colorao 
reuire identication of an eligible legalze alen by presentig an 1-688, Temporar Resident 
Card issued by the Imgrtion and Natualization Servce (INS). The 1-688, Tempora 
Resident Car wil identiy the eligible legalize alen by an alien registration number.  FINDINGS AND RECOMMENDATIONS

Both FSA and Colorado were commtted to identiying problems and developing effective 
solutions for them. Imedately following our on-site visits, FSA was given an outle of the 
State concerns identied in this report 
FINDING:  FSA ha held national conferences and issued informtion to States
Since  1987, 
on implementing the SUAG program. 
begig 
The -FSA held several national conferences  in 1987 to share 
inormation with States on SLIAG legislation, the implications for States, the 
application process, and the documentation of costs. 
The FSA also provided States with "Question and Answer" issuances and 
frm 
demographic data  the INS. 
FINDING: Colorad established a strcture to identify organizational and program needs. 
Thugh a Medical Cae Management Progr, the Colorado Deparent of 
Health intends to elevate the health status of needy individuals to approxiately 
that of the State s general population. 
hi, 
The Colorado Deparent of Health also intends to recrit,  trin, and 
ethcaly, 
supervse parprofessional communty health workers who are 
cultuy 
liguisticaly, and  sensitive to its servce population. 
To increase involvement of eligible legalze alens in educational programs, a 
local organzation choosing to offer services to eligible legalze alens wil 
signcant outrach activities. These wi be submitted as 
reuired to develop 
submitted to the Colorado Deparent of Education 
par of the Plan of Servce. 
SLIAG Adult Education Offce in response to a request for proposals. 
FINDING: Colorad also took steps to document exenditures and control disbursements.  Because counties admster cash assistace programs in the State, the State had 
no system to reimburse counties for SLIAG-relate expenditues. At the time of 
clai 
the inspection, Colorao was developing such a system. To 
reimburement, counties will use existig automated systems-the Client 
Orented Information Network and the Medcaid Management Information 
progr 
System-to document, accumulate, and report  costs for individuals 
presentig the 1-688, Temporar Resident Card. In the foster care payroll 
system, provider payments wil be identied using two new distict category 
cods. 
Since expenditus must occur before reimbursement is made, the system used 
wi show whether any excess cash balances exist at the servce provider level. 
Under fudig agrments with the Colorao Deparent of Education, varous 
agencies that can provide an ongoing adult basic education program must 
separately account for SLIAG expenditus before reimburement is made. The 
agreements stipulate that agencies reeivig fuds under SLIAG must collect 
and report data to the Colorado Deparnt of Education. They wi then 
document or verify enrollent, attendace, progress, certcation, and program 
expenditues. 
Nevereless, some funds control vunerabilties exist Findings and recommendations 
concerng these vulnerabilties follow 
under major topic aras. 
PUBLIC ASSISTANCE 
Assistance or Serve Activities 
Colorado offers a number of public assistace program and servces to its residents. The 
eligibilty reuirements for these servces are that the individual should be born in the United 
natual 
States, be a  refugee, or be an alien legaly residing in the Unite States. No 
duration of residency reuirments exist 
adster 
Under public assistace in Colorado, county Deparents of Social Servces  all 
cash assistace program. Colorado is using the existig servce delivery proess for 
SLIAG-relate servces and wi be offsettng 100 percent of State and county costs for
providig these cash assistance program to eligible legalzed alens. 
For the time being, the State has chosen to make legalized aliens eligible for State and county 
public assistance progrs. These progrs include Old Age Pension-B and Aid to the 
Needy Disabled classifed as "genera assistance" by SLIAG. However, eligible legalized  alens wil possibly be disqualfied frm eligibilty for Old Age Pension- B Prgram and/or Aid 
Progr 
to the Needy Disabled  benefits if funding to meet the projected number of eligible
legal 
alens needing those benefits is not available. Counties may also disqual eligible
legaled alens frm 
local general assistace benefits. 
Colorado believes that because eligible legalze alens are bar frm AFC, they wi use 
mially. 
public cash assistace only  In adtion, the numbers of disabled or aged 
individuals seekig assistace ar projecte to be proportonately smal. Also, most eligible
legal 
alens are self-suffcient because they have been workig and wi have to prove ths 
for legalzation. However, State offcials are concerned that people who are eligible for 
assistace wi hesitate to seek it because of the INS "public charge" policy. 
FINDING: Conflicting interpretatins of the term lIpublic charge" ha causef, uncertainties 
for the aliens as to what services they are entitled to receive without 
fear of deportation. 
ar afd 
Some people  to identiy themselves as alens for fear of being considere a "public
ar uncert 
charge." As a result, alens  about benefits they may be entitled to and whether 
acceptig these benefits would subject them to possible deponation if they ar identified as a 
public charge. 
RECOMMENDATION: The FSA and the INS should fuher clarify what is meant by 
public charge" and widely disseminate this informtion to the aliens who hae raised 
concerns about their resident statu. 
For medcal assistace benefits under public assistace, the Deparent of Social Servces
wi 
use contracts drawn between it and the medcal providers. In accordace with the 
contrcts, these providers wi be reimbured for providig health car to the medically 
Progr 
indigent The Medically Indigent  for eligible legalzed aliens will follow the same 
practices as the State s curent Medcaly Indigent Progr, including the coverage of servces 
and the patient s abilty to pay. Contrcts wi stipulate that the Medcaly Indigent Prgram 
wi reimbure providers at 100 percent of their costs for servces to eligible legalzed alens;
however, ths is only afer patient responsibilty and any thd par 
responsibilty are 
deducted 
For eligible legalze alens located in an ara not served by a Medcaly Indigent Prgram 
provider, the Deparent of Social Servces has entere into a cooperative agrment with the 
Deparent of Health. These providers wil contrct for servces furished to the general 
population and must submit to the Deparent of Social Services a voucher for 
reimbursement of the services.  Only a lited number of eligible legalized aliens will meet the categorical eligibilty 
requirments for Medcaid in Colorado. They would have to meet the eligibilty requirments 
Progr, 
for the State s Old Age Pension  the Supplementa Securty Income Aid to the 
Progr, 
Disabled  pregnant women, emergency medical care servces, or children covered 
AFC 
under  who are under 18 year of age. 
Legalze alens who ar eligible for any of the public assistace programs adstered 
county Deparents of Social Servces will be served in a maner identical to the rest of 
Colorado s population. 
Coloro wi be providig foster car maintenance and claig SLIAG fundig for the 
eligible legalze alen childrn who meet AFC eligibilty reuirements. For them, Colorado
wi 
provide foo, clothg, and shelter. 
Documentaton of Eligible Legalized Alien Stats 
In Colorado, the intae proess for benefits wi include askig the applicant for identication 
legal 
as an eligible legalze alen. It wi be necessar for eligible  alens to present to the 
intae personnel their 1-688, Temporar Resident Car. Ths is the only prof of identication 
wi 
Colorado  accept. When an eligible legalze alen later becomes a permanent resident, 
the Resident Alen Car (1-551) would be acceptable. 
Program Costs 
In Colorado, the non-Federal shar of the cost of cash and other assistace provided to eligible
legal 
alens wil be fully reimbured frm SLIAG funds. The identication number 
each eligible legal aliens s 1-688 wi be used in alady-existig automated systems-the 
Clent Orented Inormation Network and the Medcaid Management Inormation System-to 
progr 
document, accumulate, repor and reimburse  costs. For public assistace, the 
process is covere below: 
Progr 
The cash assistace payments for the Old Age Pension  and for the Aid 
to the Neey Disabled Progr will be identied on a report generat d by the 
claig 
Client Orented Inormation Network and wil be the basis for Federal 
the State was not reimbursing counties for general assistace 
puroses. Since 
expenditus, Colorado is developing a unique system which wil be agreeable to 
both the State and county. Under the IV-E Prgram (foster care maintenance), 
foster care provider payments made on behalf of eligible legalized aliens 
wil be 
identified in the foster care payroll system using two new distinct category codes.  To identiy eligible legaled alen Medcaid expenditues the State wil use a 
proess simar to the one used for refugee Medcaid expenditues. Eligible 
legalze alens wil be identified as a unique subset withn the Medicaid 
Management Information System. 
progr 
The  costs identied wi be shown on a Federa financial report required anualy by 
SLIAG reguations. 
Administratve Costs

Colorado s identication of public assistace progr adstrtive costs for SLIAG wil be 
accomplished by applying 'caseload percentages to the tota costs. For example, the 
unduplicate caseload percentage for SLIAG would be applied to al Medcaid admstrative 
adstrtive 
costs, resultig in the SLIAG Medcaid-relate  costs. 
For reportg puroses, 50 percenXt wIi  be claiedp urnodegr rt he SLIAG grt and 50 percent 
be claied under the reguar title  Medcaid  The caseload statistics for both 
SLIAG and the enti pocpullaationi wei dbe  used to identi the population for whom 
reimbursement is being 
State reimburement to the counties for admistrative costs for those progrs with a 20 
percent county shar (Aid to the Neey Disabled AFC-Foster Car, and fOO staps) 
occur quarrly thugh use of a unque program code. A unique object code wi identi 
each program shown separtely on the reports to the county. 
The counties wi clai salares and frge benefits frm the State by proratig portons of the 
sta salares. A specifc Tun Distrbution Sheet is to be used by sta for any tie spent on
SLIG. A percentage would be derived by dividig the tie spent on SLIAG by the tota 
tie in the month. Ths percentage is applied to the salar and frge benefits paid that month 
and the amount that is reported to the State Accountig and Puchasing Division using the 
unque progr code. Operating costs that can be diectly identied to the progr would 
progr 
also be reported by use of the unique  code. 
Drawdown of Funds and Cash Balances 
The Deparent of Social Servces is the  and is responsible for drwdown of 
grtee agency 
Federa fuds, disbursing funds to the State agencies providig SLIAG-related servces, and 
reportng these expenditus to FSA. 
A Federa letter of crdit will be prepar based on actual expenditus when possible. The 
agency wil draw down funds to cover expenditus once a week or as often as watanted.  The Federa funds wi be use to reimburse services on a monthly basis, using one-twelfth of 
the projecte costs submitted in the SLIAG application. At the end of the fit quarer, an 
adjustment will be made of actual costs to estimated costs. The adjustment 
wil then be 
applied in the succeeg quarers' drwdowns. A pattern of expenditus based on actual 
wi 
costs  then be established as a basis for the Federal drwdown. Cash balances are 
monitored and a schedule of Federa drawdowns is prepar and recorded as often as the 
drws occur. 
No cash balances exist at the servce provider level since the 
expenditue must have OCCUled 
befor reuest for reimburement can be made. 
HEALTH ASSISTANCE 
PUBLIC 
Assistance or Serve Activities 
The Deparent of Health has entere into a cooperative agrment with the Deparent of 
legal 
Social Servces to provide public health assistace to eligible 
alens when such 
assistace is otherwse generaly avaiable to all citizens residig in Colorado and for the 
generaIpublic s health protection. The Deparent of Health's public health treatment 
progr 
either provides the necessar servces or reimbures county or local health agencies 
for the servces. Although these public health servces ar funded by State and local monies, 
when these services ar providSe Lto eIligAibleG lega.l ze alens, the costs ar 100 percent 
federay reimburable under 
The Deparent of Health and/or public health facities wi provide the followig servces to
eligile legalze alens: 
tuberculosis screening, tratment, and any necessar public health follow-ups; 
tratment and case management of sexually transmitted disease such as 
gonorhea and syphils; and 
case reportg and maagement of Acquired Imune Deficiency Syndrme. 
wi 
It  also be the responsibilty of the Deparent of Health to 
coordinate a Medical Case Management Prgram to elevate the health status of 
neey individuals to a level approximating that of the genera population of the 
State;  recrt, hie, trn, and supervise parprofessional community health workers 
who are ethcaly, linguistically, and cultually sensitive to its servce 
population; 
negotiate and subcontract the services of community health workers with local 
health deparents, communty cliics, hospitals, and other appropriate local 
health entities where they exist; 
coordiate a medical authorization system for its servce population in cities, 
Progr 
towns, or counties of the State where a Medicaly Indigent  provider is 
not reasonably accessible; and 
operate a medical authoriation system for payments to local health care 
providers, COIIunty clics, and hospitas that agre to provide medcal 
servces to neey individuals. Cost of reimbursement cannot excee the 
Deparent of Social Services' Medicaly Indigent Program rates for simar 
servces. 
Documentaton of Eligible Legalized Alien Stats 
The public health agencies providig services have amended the existig intae process to 
identiy eligible legalze alens. When potential eligible legalze aliens go in for servces, 
they ar asked if they have reently adjusted their residency status. The informtion is taen 
in confdence. If the individual is an eligible legalze alen, he or she must present the 1-688, 
Tempora Resident Card, and the health agency will record the alen registrtion number. To 
clai SLIAG money, the agency must see ths car with the identication number. 
Program Costs 
Individual eligible legalze alens ar being identied and the individual cases followed to 
doument health servces and keep trck of 
costs. Costs of preventative or educational health 
servces are determed using a population ratio method 
tr. 
Colorado s system provides for a full audit  Strngent controls are set up to support it. In 
monitorig progr costs, the Deparent of Health is reuir to report to the Deparent of 
Social Servces. The Deparent of Social Secrvacersg m onitors al public health expenditus 
for compliance with SLIAG requirments. In  out this responsibilty, the Deparent 
of Health has designated an eligible legalize alien public health coordnator to be responsible 
Imgrt 
for al report and to present and explain them at monthly Refugee and  Services 
Program contrctor meetigs.
 To aid in gatherig some data on eligible legalze aliens, the Deparent of Health has 
developed a system to matain a registr of eligible legalize alens who 
ar tested and 
trated for tuberculosis. On a quarerly basis, the Deparent of Health submits to the 
Deparent of Social Servces a biling for tuberculosis testig and treatment, medical case 
management, and authorization. Also on a quarerly basis, the Deparent of Health has to 
submit a mUTative report includig at least (1) the tota number of eligible legalze alens who 
were tested and trated for tuberculosis, (2) the progress and activities of the medcal case 
maagers, and (3) any actions the Deparent of Social Servces requird them to perform. 
The Deparent of Health must also submit two reports at the end of the fiscal year. These 
reports cover two separate period in the fiscal year and include at least the followig 
inormation: (1) the actual SLIAG-related costs incured durng the fiscal year for each public 
progr 
health  identied in Colorao s application, (2) the Deparent of Health's SLIAG
adtrative 
costs, and (3) the amount of SLIAG funds obligated to each public health 
progr 
and the tie period for which the funds were obligated. 
Administratve Costs

The Deparent of Health has developed tight budget reguations coverig SLIAG and has 
the necessar accountig system in place to document adnistrative costs. To keep trck of 
al expenditus, the Deparent of Health has established separate agency budget ledgers for 
each cost item. Costs ar alocated by time sheets, and expenditues wi be claied based 
. upon prorate salares and frge benefits. Travel costs encompass in-State costs for disease 
contrl sta, in-State costs for public health staf, and out-of-State costs for public health sta. 
Also included in adistrative costs are operatig and equipment costs. The Deparent of
wi 
Health  use an indict cost rate approved by the U.S. Deparent of Health and Human 
Servces, the cognant Federal agency. These costs ar included in the two fiscal year reports
submitt to the Deparent of Social Servces. 
Drawdown of Funds and Cash Balances 
To obta reimburement for servces rendere, the Deparent of Health has to submit the 
appropriate report to the Deparent of Social Servces. This report is the supportng 
documentation used to reimbure the Deparent of Health by trsferrg the funds though 
an interagency voucher or by a dict vouchering process. The Deparent of Social Services 
does not advance any funds for program costs.  EDUCATION 
Assistance or Servce Activities 
The Deparent of Education has entered into a cooperative agreement with the Deparent 
of Social Servces to provide educational servces to eligible legalze alens. Even before the 
implementation of SLIAG reguations, the Deparnt of Education has had a goo reputation 
and has been a long-term consultat to agencies providig qualty educational servces to 
individuals with lited English-speakg skils. The Deparent of Education is staed with 
well-qualed individuals and an extensive servce network which can rapidly implement 
additional services. 
In Colorado, the educational servces to be provided under SLIAG wi be those allowed 
under the Adult Education Act, Emergency Imgrant Education Act, and other programs 
att  reui 
designed to enable eligible legalze aliens to  citizenship skis  by INS to 
adjust to permanent resident atlenh status.u  gh 
The followig adult education services wil be available for adult eligible legalize alens and 
providers of services to them 
instrction in basic skis to enable adults to function effectively in society 
(includig the abilty to speak, read and wrte the English language); 
instrction leadng to the equivalent of a certcate of gruation from a school 
providig seconda education; 
instrction for adults with limited English proficiency; 
instrction in citizenship skills; and 
ancilar servces to local providers includig cunculum development, teacher 
traig, and evaluation. 
seonda 
If the local elementar and  educational agency meets the enrllment theshold 
requied by SLIAG, it can use SLIAG funds to provide these servces for children: 
supplementa educational services necessar to enable 
childrn to achieve 
satisfactory level of performance, includig English language instrction, other 
bilngual servces, and special materials and supplies;  adtional basic instrctional services that ar diectly attrbutable to the 
presence in the school distrct of immgrant children, includig the costs of 
providig additional classrom supplies; overhead costs; costs of constrction 
acquisition, or renta of space; costs of transportation; or such costs diectly 
adtional basic instrctional servces; and 
attbutable to such 
essential in-servce traing for  immgrant 
personnel who provide instrction to 
chidren. 
wi 
The SLIAG Adult Education Offce  issue a request for proposals to local Adult Basic 
Progr 
Education  sites and interested public or private nonprofit agencies statewide. 
Prposals wi be reviewed by the SLIAG adult education progr manager in the 
Deparent of Education with assistace from a commtt. Review crteri wi be published 
in the reuest fQr proposal. The Deparent of Education will evaluate al progrs 
determe if they meet SLIAG crteria for educational delivery systems and wi recogn 
those that ar awared fudig as approved progrs. It is anticipated that approximately 30
progrs wi 
be selected for fundig. The request for proposal process was selected to 
ensure that al intereste community-based organzations would be faily considered. 
A local organzation choosing to offer educational servces to eligible legaliz aliens wil be 
reuied to develop signifcant outrach activities as par of its Plan of Service. The Plan of 
Servce wi be submitted to the State Adult Education Offce for approval in response to the 
request for proposal. To assur success, outreach effort wi have to include requests for 
referrs from varous communty progrs that come in contact with eligible legalze alens. 
fudig floor wi be established for those progrs where smal numbers would result in a 
reimbursement too smal to cover the cost of instrction. SLIAG fundig to a service provider 
legal 
is to be the lesser of actual costs or $500 multiplied by the number of eligible  aliens 
served 
The SLIAG funds wi be alocated to local educational agencies using the Emergency
Imgrt 
Education Act guidelines and mechanisms. Because of the enrllent thshold 
reuired for SLIAG, very few school distrcts, if any, wi be eligible for reimburement. 
Furermore, many eligible legalze alen childrn wi be eliated frm the eligible pool 
because of the attendace requiment of fewer than 3 ful academic year in U.S. schools. 
Therefore, budget projections for the elementar and seconda schools are minima. 
The Deparent of Education wil request applications frm local education agencies for 
fundig. Unti ths proess is completed it wil be diffcult to assess actual eligible programs.  Documentaton of Eligible Legalized Alien Stats 
The Deparent of Education wi mody its basic enrllent form to identi eligible
legal 
alen students for SLIAG  moded form wi ask for information 
puroses. The 
related strctly to eligible legalze aliens. As par of the enrollent intae proess, the 
eligible legalze alen must show the 1-688, Temporar Resident Car, or SLIAG money 
canot be claied. Although a computer system was not set up to record this information for 
documentig costs, it was to be in the futue. 
Program Costs 
The Deparent of Education enters into fundig agrments with varous agencies that 
able to provide an ongoing adult basic education program The fudig agreements stipulate 
that agencies reeiving funds under SLIAG must collect and report data to th  Deparent of 
verig 
Education documentig or  enrollment, attendace, progrss, certcation, and 
progr expenditus. In addition, the fudig agreement also stipulates that the provider
wi mata 
a separate accountig for SLIAG funds obtaied though the agrement. It wil 
conta a reord of al reimburable progr expenditus requested frm the Deparent of 
Education. Ths includes a complete record of how funds were spent and a listing of the 
reipients of such funds. Servce providers may  Deparent 
reuest reimburement from the 
of Education on a monthy, quarerly, semi-anual, or anual basis. 
Administratve Costs

The Deparent of Education, in accordce with the SLIAG reguation, has a 1.5 percent 
adstrtive 
lit on  costs. These costs are made up of management and supervisory 
dit 
activities necessar for the State educational agency to 
and contrl developing and 
progr. 
overseeing the  These costs do not include ancilar servces such as evaluation, 
teacher trg, dissemiation, and cunculum development The Deparent of Education 
believes the lit on SLIAG adistrtitvie  costs is to strgent and would not alow the 
progrs 
to be implemented on a full- basis. 
FINDING: The State ha  ducation program
not developed a method to determine 
adnistrative costs. 
Prgr 
adstrative 
costs ar captued on two documents, which the adult basic education 
agency submits to the Deparent of Education. One is a Summar of Costs document 
itemizing al personnel and program costs. The second is a Reimbursement Request form 
categorizig expenditus by code number. Both documents relate to reimburement for 
actual expenditus. Ths is not consistent with the SLIAG regulation, which provides that 
these costs must be alocate to SLIAG in either the sam proporton that eligible legalized 
alens are representative of the tota number of 
individuals served, or the tota cost of the 
progr.  RECOMMENDATION: The Colorad Department of Education should ensure that 
providers of educational services are properly calculating education program adinistrative 
costs. 
Drawdown of Funds and Cash Balances 
Ths process is identical to the system the Deparent of Education uses. The Deparent of 
Education submits the appropriate report to the Deparent of Social Servces. This report 
wi be the supportg documentation used to reimbure the Deparent of Education. The 
dit 
trsfer of fuds wil be though an interagency voucher or a  voucherig proess. The 
Deparent of Social Servces does not advance funds for progr costs. 
CROSSCUTTNG ISSUES 
Colorado offcials were concerned with FSA' s untiely proessing of its State application. 
They believed the following: 
aliens; 
that ths delay created a slowdown in providig the servces neeed by eligible 
legalze 
that a "lack of trst" exists in FSA; 
priar 
that FSA believes the  intention of SLIAG is to provide servces and 
assistance to eligible legalized aliens without any major effect on the existig 
system for programs; 
that FSA is more concerned with budget cuttg and has made implementig the 
progr 
more dicult, thus impedig the State s abilty to provide servces to 
eligible legalzed alens; and 
that too much Federa involvement affects gettng the servces to the eligible 
legalze alens. 
FINDING: The FSA application review process created anwner of signifcant problems for
Colorad. Also, the FSA's application review process interfered with the State s ability to plan 
for services.

Delay in FSA issuing the implementing regulation resulted in the State 
inabilty to properly plan for SLIAG.  .. -.. -
Numerous policy misinterpretations and disagreements resulted because FSA 
did not provide definitive wrtten instrctions to assist Colorado in 
understadig SLIAG application requirements. 
tie fres 
The  were too short for submittig the initial SLIAG application 
FSA review and comment, and revisions of the application. 
form 
No  appeals process exits if programs or costs are denied in the 
fit-
level review. 
Accordig to fmal regulations published Marh 10, 1988, States had to submit the FY 1988 
application no later than May 16, 1988. Revisions to the application had to be submitt by 
July 1, 1988, and the FY 1989 application had to be submitt no later than July 15, 1988. 
Applications were to conta brief descrptions of the State  progrs or servces, estiates 
of the State s SLIG-relate costs for each program or activity for that parcular fiscal year 
(includig inormation on the number of eligible legalze alens residig in the State), and a 
brief explanation of the methodology used to estimate these costs. 
tie fres, 
Due to these short  FSA was not able to provide feeback on revisions necessar 
in the State s FYt i19 88 application. The informtion was trsmitted by telephone or in 
meetigs. The  frames to mae necessar revisions did not accommodte the 
progr 
organzational strctu or the nee to communicate with or seek approval from the 
components afecte by revisions reuested by FSA. Although some changes had a major 
progrs 
effect on  and grant amounts, the single point of contact received no 
offcial rationale 
sta 
frm FSA for requestig the changes. This could place the single point of contact or the 
person who assumed responsibilty for revisions in an awkward position should the changes or 
the amount of the  questioned 
grt be 
The FSA did not provide for paral funding nor conditional approval of applications, nor did 
the FSA provide for an appeals proess when programs, costs, or methodologies were not 
approved 
RECOMMENDATION: The FSA should mae its application and grant process more 
orderly. Specifcally, FSA should 
provide definitive wrtten instrctions on the SLIAG application requirments 
and establish a dialogue with Colorado on SLIAG policy, compliance, and 
occur 
reportng issues to miimize the confusion that  in the initial application 
process; 
16 .  tie 
ensur that sufficient  is allotted to the application process includig 
Colorado s intial application, FSA' s review and formal comment, Colorado 
consideration of FSA comments and negotiation of disputes, and its submission 
of the revised application for FSA approval; and 
progr 
develop an appeals process to use if  or costs associated with providig 
servces ar denied in the initial application proess.  OIG RESPONSE TO COMMENTS 
The FSA and the State of Coloro both commente on the drt report. 
THE FSA 
agr 
The FSA has generaly  with the OIG report fidigs and reommendations. The FSA 
has taen a number of stes to improve implementig the SLIAG progr includig
claryig progr policies and proedurs. In the report the State had several concerns 
cert 
about the FSA adstration of the progr. We have modfied  aspects of the report 
based on the comments reeived frm FSA. 
The FSA questioned the statement that the new population would signcantly increase public 
assistace and public health assistace servces. Early estiates indicated that large numbers 
of alens would qualy to access the SLIAG progr. The report recogned that inormation 
obtaed durg 
the review determed that substatial incrases in workloads and 
expenditus could occur in these program areas as well as in education. However, we 
understad frm recent discussions with State offcials that demand for servces is falg
behid earlier projections. We reported that there is no formal appeals process if progr 
agr 
costs ar denied in the fit level review. We  with FSA's statement that the Grat 
Appeals Boar does have jursdction over mattrs for witholdig and repaymnt of SLIAG 
funds. However, it was the State s concern that an effective appeals mechanm be in place 
for issues involvig progrs or costs at the fial level of FSA's review in the application 
process. 
cert 
The FSA made numrous comments to clary  matters of fact, policy, or proedure. 
have included these comments verbati in appendi B. 
The Stae of Colorado 
agr 
The State has generay  with our fmdings and recommendations. Their comments 
included verbati in appendi C.  APPENDIX A

GOOD PRACTICES
 A number of practices have been identied that  har. 
other States could 
adster  progrs 
Because counties  cash assistace  in the State, the State had no sys
tem to reimburse counties for SLIAG-related expenditus. At the tie of the inspection 
Colorado was developing such a system. To claim reimburement, counties will use ex
istig automate systems-the Client Orente Inormation Network and the Medcaid 
Maagement Inoration System-to document, accumulate, and report program costs 
for individuals presentig the 1-688, Temporar Resident Card. In foster care, provider 
payments wi be identied in the foster car payrll system using two new distict cate
gor cods. Since expenditus must occur before reimburement is made, the system 
used wi show that excess cash balances do not exist at the servce provider level. 
Under fundig agrments with the Colorado Deparent of Education, varous agencies 
that can provide an ongoing adult basic education program must separately account for 
SLIAG expenditus before reimburement is mad. The agreements stipulate that agen
cies reeivig funds under SLIAG must collect and report data to the Colorado Depar
ment of Education. They wi then document or veri enrllent, attndace, progrss, 
progr 
certcation, and  expenditures. 
Thugh a Medcal Case Management Progr, the Colorado Deparent of Health in
tends to elevate the health status of neey individuals to approxitely that of the general 
population of the State. 
hi, 
The Colorado Deparent of Health also intends to recrit,  tr, and supervse par-
professional communty health workers who ar ethcaly, ligusticaly, and cultualy 
sensitive to its servce population. 
To increase involvement of eligible legalize aliens in educational program, a local orga
nization choosing to offer services to eligible legalze alens will be requied to develop 
signcant outrach activities. These wi be submitt as par of the Plan of Servce sub
mitted to the Colorado Deparent of Education s SLIAG Adult Education Ofce in re
spnse to a request for proposals.  J ' 
APPEDIX 8

FSA' S COMMENTS  ; . :	 -.  ...", .. ..'.'-..  ;,.,;. . .. .,",.'';.. ;" " ': . , :,'" '.-" :  ..;:.: '... ' :-  .-!: : -" :.. "" , 
APPENDIX B

-..IC,. 
DEPARTMENT OF HEALTH &. HUMAN SERVICES	 mlly Support Administration 
Offce of Refugee Resettemen'.

Memorandun 
Refer to: 
Date:	 July 11, 1989 
Acting Assistant Secretary 
From: 
for Family Support 
Subiect:	 OIG Draft Report: Implementation of the State Legalization 
Imigration 
Impact Assistance Grants Under the  Reform and 
Control Act of 1986 - State of Colorado (OAI-07-88-00443) 
To: 
Richard 
P. Kusserow

Inspector General

Attached are the Family Support Administration comments on 
coments are technical in 
the above report. Many of our 
nature due to the complexity of the legislation and the

fact that the SLIAG program was very new at the time of the

review. 
We appreciate the assistance and cooperation we have

received fran you in response to our request to conduct this

round of reviews of the SLIAG program. 
The reports we
received are very useful to us in understanding how States

are implementing the program. 
Attachment 
: C

r .., 
i: 
lS : 
rU t I lnr 
 SS6J 
r:..:  I.' 
"1 ", 
::J 
B-1  OIG DRA REPORT:

Implementation of the state Legalization Impact Assistance Grants 
Under the Immigration Reform and Control Act of 1986: 
COLORA 
The Family Support Administration' 
s comments are divided into
three sections: 
Comments on background information and other 
narrative material that does not relate directly to the draft
report'  s recommendations. 
s findings, comments on the findings, and responses to the 
draft report'
Harrati ve: 
Page 1 (Background) -- The draft report says, "This new 
for' State public assistance 
population will increase the demand 
and public health assistance services significantly.  The draft 
report isn t clear whose conclusion this is or upon what data and 
analysis the conclusion is based. The final report should 
clarify these points. 
In the course of implementing SLIAG, we have discovered that 
neither state and local public health programs nor, with few 
exceptions, public assistance programs, inquire about legal
status. 
This' suggests that at least some aliens were using these 
services before legalization and that newly legalized aliens do
not represent a "
new population" for public assistance and public 
heal th assistance services. Preliminary cost data from States 
suggests that newly legalized aliens  e accessing public 
assistance services at rates far lower than the general
population. 
There are indications that a backlog of public 
heal th needs existed and was identified during the medical 
legalization.
examinations required of all applicants for 
However, there is no data to suggest that, other than this 
temporary bulge in demand for public health services, newly 
legalized aliens will generate a significant increase in demand 
services. 
for public health assistance or public assistance 
Page 2 (Background) -- The draft report says, "states must 
develop a method acceptable to FSA for determining
administrative costs. 
The final report should note that several 
administrative costs in 
methods for determining the share of 
ongoing programs that are allocable to SLIAG and which are 
a Driori are specified in the regulation at 45 CFR

acceptable 
402.  - The process of determining SLIAG administrative costs 
22 (b)  itself),
(those costs incurred in administering the SLIAG grant 
like all costs associated with administering HHS grants, is 
circulars. 
governed by 45 CFR Parts 74 and 92 and relevant OMB 
(Pulic 
Page 7  Assistance Documentation of Eligible Legalized 
Alien Status) -- The draft report states that the only proof of 
identification Colorado will accept for eligible legalized alien

status is an 1-688 temporary resident card. The final report

should note that eligible legalized aliens have that status for

five years from the effective date of lawful temporary resident

B-2
 status. 
However, during that time period, they will move from 
temporary resident to permanent resident status. When they do

so, they will be issued permanent resident cards 
(1-551), which

will include documentation of eligible legalized alien status.

Page 8 (Pulic Assistance Program Costs) -- The draft report

states that, "program costs identified will be shown on a

quarterly Federal financial report required by SLIAG

regulations. " The final report should note that the regulation

at 45 CFR 402.51 requires annual reporting, not quarterly

reporting. 
Page 13 (Education) -- The draft report says, "A local
organization choosing to offer educational services to eligible 
liens will be required to develop significant outreach 
legalized 
and public relations activities as part of its Plan of Service. 
Outreach to let potential students know about availability of 
educational services is an allowable administrative cost (within 
ducational 
statutory and regulatory funding ceilings for 
services) . It is not clear, however, what "public relations
activities" are in the context of this description. 
The final 
report should' make clear how "public relations activities" relate
to providing educational services as defined in Federal 
regulation at 45 CFR 402. 
Additionally, page 13 of the draft report 
says, "A funding floor
will be e$tablished for those programs where small numers would 
result in a reimbursement too small to cover the cost of

instruction. II Because IRCA applies the definitions and
provisions 
f the Emergency Immigrant Education Act (EIEA) to use
of SLIAG funds for educational services, the regulation at 45
CFR 402. 11(e) limits the amount the State education agency may 
pay to a service provider to the lesser of actual costs or $500 
numer of 
mul tiplied by the  eligible legalized aliens served. 
The regulation at 45 CFR 402.2 defines educational services for 
adults as those activities that are authorized by the Adult 
Education Act as in effect November 6, 1986. As the draft report
notes, these activities include certain ancillary services. 
FSA 
has not specified methods States must use to calculate costs. 
However, the final report should note that the funding
limi tat ions 
described above do apply to all educational services 
provided with SLIAG funds. 
Page 15 (Crosscutting Issues) -- The draft report quotes Colorado

officials as saying that a "lack of trust" exists in FSA. We are 
perplexed as to the meaning of this statement. 
The final report
sohfofuilcdi acllsar. ify the point. FSA does not distrust Colorado
However, we believe it is our responsibil ty to
fashion. In 
administer SLIAG in a business-like 
some cases, this
has meant asking for more detail than the State submitted in its 
original applications or asking for the basis on which the State 
B-3
 has made statements or assertions. We do not believe that any

such inquiry demonstrates a "lack of trust.

The draft report also quotes Colorado officials as saying, "FSA

bel ieves the primary 
intention of SLIAG is to provide services 
and assistance to eligible legalized aliens without any major 
effect on the existing system for other programs.  The meaning
of this statement is unclear, and the final report should 
provide clarification. The final report also should note the 
"intention of SLIAG," which is laid out in IRCA. In brief, it is 
(1) to reimburse state and local governent costs associated with 
providing public assistance and public health assistance services 
(as those terms are defined in IRCA and in Federal regulation) to 
eligible legalized aliens within ongoing programs, and (2) to
provide certain educati nal services to eligible legalized
aliens. 
Colorado officials further are quoted as saying that "FSA is 
more concerned with budget cutting and has made implementing the 
program more difficult, thus impeding the State's ability to
provide services to eligible legalized aliens.  It is not clear 
to what the reference to providing services to eligible legalized 
aliens refers because, as noted above, under IRCA, SLIAG funds 
may not be used to provide public assistance or public health
assistance designed specifically for eligible legalized aliens. 
FSA is committed to ensuring that States may claim all legitimate 
SLIAG-related costs. The reference to "budget cutting" appears 
to refer to FSA' s response to cost estimates in the State' 
application that were not based on any empirical data. Because 
half of SLIAG funds are allocated based on each State's share of 
the cost of all States, if one state overestimates its costs, 
that State would receive more than its share of funds and other 
share. 
States would receive less than their  Thus, in order to 
assure fairness, FSA reviewed state cost estimates in accordance 
wi th criteria specified in the preamble to the regulation and 
applied consistent standards among states. The final report
should note these points. 
In the draft report, Colorado officials are said to believe "that

too much Federal involvement affects getting the services to the 
eligible legalized aliens.  The meaning of these statements is 
clarification,
unclear, and the final report should provide 
especially in light of the fact that IRCA allows only educational 
services funded with SLIAG to be directed specifically to 
eligible legalized aliens. 
Findi 
Finding: 
Since 1987, FSA has held national conferences and 
issued information to states on implementing the SLIAG 
program.  Comment:  Since the OIG's onsite visits in August 1988, we have

continued to provide assistance to States. 
We have

conducted several more workshops and meetings to assist

states in implementation. In 
October 1988, we issued a

compendium incorporating the extensive formal guidance

previously provided to States on methods of cost

documentation. We also 
have provided assistance to

individual States in the form of correspondence,

telephone consultation, and onsite technical

assistance. We are in the process of conducting

initial program reviews of the major States, and intend

to visit selected other States as well. 
We request
that the final report reflect this continuing dialogue

with States. 
Finding: 
Colorado established a structure to identify

organizational and program needs.

Comment:  The draft report on page 4 lists a  steps
riumber of 
Colorado took to identify "organizational and program

needs. 
(Some of these steps also are featured in the 
Appendix, "Good Practices, " which the draft report

suggests could 
 e emulated by other States.  It is not 
clear from the description of these steps that the 
statute and regulation limit use of SLIAG funds for 
public assistance and public health assistance to 
activities that are "generally available. 
This means 
that States may not use SLIAG funds to set up pUblic 
assistance or public health assistance programs
specifically for "
eligible legalized aliens.  The 
final report should make clear how this requirement

relates to the State actions featured in the draft

ort. 
In making this clarification, the draft report also

should address the statement on page 6 that, "The

Medically Indigent Program for eligible legalized

aliens will follow the same practices as the State I
current Medically Indigent 
Program, including the
coverage of services and the patient'
s ability to pay.
The next paragraph states that the Department of Social 
Services has entered into an agreement with the 
Department of Health to provide services "for eligible 
legalized aliens located in an area not served by a 
Medically Indigent Program provider.  This description
suggests a program set up specifically for eligible 
legalized aliens and fails to make clear how the 
program complies with the "generally availa le"
requirement. 
The same issue arises on pages 9-10. The draft report

lists a number of Department of Health

B-5  " "
include: "
responsibilities. These 
negotiate and
subcontract the services of community health workers

for eligible legalized aliens...,  coordinate a

medical authorization system for eligible legalized

al iens in 
cities, towns, or counties... where a 
Medically Indigent Program provider is not reasonably

accessible, 
. and "operate a medical authorization
system" to make payments to providers with .
the proviso
that .
cost of reimbursement cannot exceed the
Departent of 
Social Services' Medically Indigent 
Program rates for similar services.  The Department of
Heal th also is charged with coordinating the Medical 
Case Management program for eligible legalized aliens, 
as described above, and with recruiting, hiring, 
training, and supervising paraprofessional community
al th workers "who are ethnically, linguistically, and
:culturally sensitive to 
eligible legalized aliens. 
is not clear from the description that any of these

responsibilities are part of a program or activity that

is generally available to the population, as IRCA and

final 
5 CFR 402.2 require. The 
the regulation at 

report should clarify whether these are, in 
fact, part

of generally available programs or services.

Finding: 
The FSA application process created a numer of 
Colorado. 
significant problems for  Also, the FSA' 
pplication review process interfered with the State' 
ability to plan for services. 
Comments:  The draft report says that the time period for 
submission, review, revision and approval of the 
initial application was too short. We agree that it
would have been preferable to have had a longer period 
of time between the publication of the final regulation 
and the deadline for submission and approval of FY 1988 
and FY 1989 applications. However, the final report
should note that, because of the way IRCA set up the 
allocation formula, one major reason for the compressed
time frame was that we could not award funds to any 
State until all States' applications had been approved. 
In order for us to run the allocation formula, which
IRCA requires to include estimates of costs, we must 
have approved estimates for all states before we can
calculate States' allocations. 
Page 15 of the draft report says that "numerous policy
misinterpretations and disagreements resulted because 
FSA di  not provide definitive written ins ructions to 
assist Colorado in understanding SLIAG application 
requirements. " Had there been more time, we would have 
communicated more extensively in writing. Our current 
practice is to communicate in writing on all 
B-6  substantive issues regarding state applications,

amendments, and end-of-year reports. 
The report says that no formal appeals process exists 
if programs or costs are denied. The Grant Appeals
Board has jurisdiction over issues related to the 
wi thholding and repayment of funds. For other matters, 
the State may follow normal procedures for disagreeing
with an agency finding. 
On Page 16, the draft report states that, -the single 
point of contact received no official rationale from 
FSA for requesting the changes. to the cost estimates
in the initial application. 
In cases in which we did 
not accept initial State cost estimates, we

communicated to the state that it had not provided

data to back up its estimates.

Recommendations: 
Recommendation: 
The FSA and the Immigration and Naturalization Service 
(INS) should further clarify what is meant by .public
harge. and widely disseminate this information to th 
alien population who have raised concerns about its

resident status. 
Response: 
Under IRCA and the Immigration and Nationality Act, the 
INS alone is responsible for determining whether 
individuals are likely to become public charges. 
FSA 
cannot establish policy on this issue. Nor can FSA 
disseminate information directly to the alien 
population. INS is precluded by IRCA from providing 
names and addresses of eligible legalized aliens to 
outside agencies 
However, we agree that it is important that all

concerned know INS policy on the public charge issue. 
INS representatives have made presentations at

virtually all of our workshops and conferences. 

these meetings, States have been able to ask questions

and receive direct information from the INS- We have 
communicated to States all information provided to us

by INS on this and other pertinent issues, and will

continue our policy of disseminating any relevant

information that we receive.

B-7  The Department also has indicated its support for a

legislative change to allow states to use a small

portion of their SLIAG grants to inform temporary

residents of the requirements for adjustment to lawful

permanent resident status and of the rights and

responsibilities of lawful temporary residents. Such 
use is not permitted under current law.

Recommendation: 
The FSA grant process should be made more orderly.

Response: 
The draft report. 
s recommendation refers to the 
FSA grant process, but the specifics indicate

that it is referring to the SLIAG application

and grant award process. The language of the

recommendation should be more specific.

We agree that the application process should be

conducted in a more orderly fashion than was the case

for the initial submissions. As the draft report

indicates, the timeframes for the FY 1988 and FY 1989

application processes were necessarily short. 

effect, the states and we had to complete two

application processes in less than a year. We do not:

expect similar problems for the FY 1990 and FY 1991

application processes.

To ensure that states have adequate time to prepare

their FY 1990 applications based on empirical data, we

have extended the deadl 
ine from July 15 to October
Addi tionally, we have encouraged states to submit. as 
early as possible any questions, issues, or

descriptions of new programs, and have advised them

that they may submit all or portions of their

applications at any time.

In order to reduce the possibility of misunderstanding,

we have advised states that we will communicate all

substantive questions and concerns on their FY 1990

applications in writing, as was done for states' end-

of-
year reports. We issued extensive written guidance 
on the FY 1990 application process and the standards we

will apply.

The draft report also recommends that we develop an 
appeals process to use if programs or costs associated 
with providing services are denied in the initial
applications process. 
We do not believe such a process  , , 
is necessary. The Department I s Grant Appeals Board has
jurisdiction over cases involvinq the repayment or

funds. 
withholdinq of  Normal channels within the 
Department are open to states that disaqree with

decisions made durinq the course of application review. 
B-9
 (\ 
APPENDIX C 
COLORADO' S COMMENTS  .. .
, , 
,.  :,: . q: -.,"\: .., . ::  '.; :. . ,.- .  ,(, . " _..  '' - "- -. "
APPENDIX C

COLORAO 
STATE OF 
DEPARTMENT OF SOCIAL SERVICES 
1575 Sherman Stre.:t 
Denver, Colorado 80203 
Colorado Refugee and Immigrant Services Program 
190 East 9th Avenue. Suite 300 
Denver. Colorado 80203 
Phone (303) 863-8211 
Roy Romer 
Governor 
Irene M, Ibarra 
Executive Director 
July 
10, 1989 
Richard P. Kusserow

Inspector General

Department of Health and Human Serv ices

Office of Inspector General

Washington, DC 20201

Dear Mr. Kusserow:

Thank you for the draft copy of your staff' s analysis of the

implementation of the state Legalization Impact Assistance Grant

in Colorado. The Department of Social Services appreciates the

opportunity to comment because we believe that one finding of the

report attributes a greater fund vulnerability than actually

exists. 
The finding, reported on page 14 of the draft copy of the 
liThe state 
implementation analysis, states  has not developed a 
method to determine education program administrative costs" 
This finding is characterized on page iii as representing "funds
control vulnerabilities.  correct, 
While the finding itself is 
it is likely that the state failed to communicate to the reviewer 
that an early administrative decision of Colorado' s SLIAG 
implementation was to allow education providers to bill 
assistance, 
instruction costs as actual costs including technical 
the 
but program administrative costs were not included. Thus 
rated 
reporting structure for billing has no place for pro-
costs. 
program administrative  This decision was taken partially 
due to uncertainties around the numbers of persons who would seek
educational services and because of uncertainties of allowabili 
of program administrative costs by HHS. Colorado is now, 
hboweever , eixaminnincg ao metrhodp ofo allrowiang tproegramd ad.min istr
 ative 
costs and the recommendation of the' analysis will most certainly
6 \ lnf E 
9 t; :Z \\6 
T:: :,

11- ,  . I 
C-l  , '
Richard P. Kusserow

July, 10, 1989

Page 2

Colorado believes that both the finding and recommendation have 
merit, but to characterize that finding as a fund vulnerability 
may overstate the actual circumstance. 
Once again, we appreciate the opportunity to comment on the draft

analysis. 
- Sincerely, 
Bagan 
state Coordinator

Colorado Refugee and Immigrant Services

Program 
LB/wg 
C-2