, 

:. ;... ,::. ;, .!.. . . ., _ . . :. . .r": ';' "_ " d C. ' 

IMPLEMENTATION OF THE STATE


LEGALIZATION IMPACT ASSISTANCE


GRANTS UNDER THE IMMIGRATION


REFORM AND CONTROL ACT OF 1986


STA TE OF WASHINGTON 

1\VICt$. 

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OFFICE OF INSPECTOR GENERAL 

OFFICE OF ANALYSIS AND INSPECTIONS 

DECEMBER 1989 
OFFICE OF INSPECTOR GENERAL


The mission of the Offce of Inspetor Genera (OIG) is to promote the effciency, effectiveness, and integrty of progrs in the United States Deparent of Health and Human Services (HS). It does this by developing method to detect and prevent fraud, waste, and 

abuse. Create by statute in 1976. the Inspector General keeps both the Secreta and the Congress fully and curently infonned about programs or management problems and recommends 

corrtive action. The OIG perform its mission by conductig audits, investigations, and inspections with approximately 1,300 sta strategically located around the countr. 

OFFICE OF ANALYSIS AND INSPECTIONS 

This report is produced by the Offce of Analysis and Inspections (OAI), one of the thee 

major offces within the OIG. The other two are the Offce of Audit and the Offce of Investigations. Inspections ar conducted in accordace with professional stadads developed by 

OAI. These inspections ar tyicaly short-tenn studies designed to determe program effectiveness, effciency, and vulnerabilty to frud or abuse. 

Th study was conducted to determne the effectiveness of Washington s implementation of 

State Legalzation Impact Assistace Grats funds awared under the Immgration Refonn 

and Control Act of 1986.


The report was prepar under the diction ofDon McLaughlin, the Regional Inspector 

General of Region VIT, Offce of Analysis and Inspections. Parcipatig in this project were 

the following people: 

Kansas City San Francisco 

Hugh Owens, Project Leader Apryl Willams 

Raymond Balandron 

James Wolf 

Alicia Smith 

Headquarters New York 

Albert J. Nace Lucile M. Cop 

Debra Robinson 
l ,.


IMPLEMENTATION OF THE STATE


LEGALIZATION IMPACT ASSISTANCE


GRANTS UNDER THE IMMIGRATION


REFORM AND CONTROL ACT OF 1986


STATE OF WASHINGTON 

Richard P. Kusserow 

INSPECTOR GENERAL 

OAI-07 -800450 DECEMBER 1989 
EXECUTIVE SUMMARY 

PURPOSE 

The purose of this inspection was to determe how effectively Washington implemented the 

State Legalization Impact Assistance Grants (SLIAG) program, to identify potential problems 

early in the process, and to identiy goo practices which all States could share. 

BACKGROUND 

The SLIAG program was established under the Immgration Reform and Control Act (IRCA) 

of 1986 to reduce the fmancial burden of providig public assistance, public health assis tance, 

and educational services to eligible legalized aliens. In Fiscal Year (FY) 1988, $928.5 milion 

in progr funds were allocated to States, and funds wil contiue to be alocated through 

FY 1991. These funds also cover admnistrative costs for implementing SLIAG at the State 

and local levels. Payments ar made for public assistance activities generaly available to all 

needy individuals and public health assistance services offered under the States ' public health 

programs. The payments also cover educational services designed to assist eligible legalized 

aliens to attain a satisfactory level of performance in school and to achieve English language 

proficiency and citizenship skils necessar to become permanent residents. The Famly 

Support Admnistration (FSA) is responsible for admnistering the program. 

Because SLIAG was a new progr, FSA realzed that problems would surface early in its 

implementation. In addition to the normal dificulties encountered in creating new processes 

and procedures, FSA recognized that SLIAG would have unique problems. Some of these 

issues include the diversity of programs which SLIAG encompasses, cultural and language 

barers associated with the service population, maintaning confidentiality of information, and 

the extremely short time fraes for the grt award process. 

METHODOLOGY 

In response to the anticipated dificulties with implementing SLIAG, FSA requested that the 

Offce of Inspector 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 programs they offered, the number of eligible legalized aliens in the 

population, or the amount of the grant award. The nine States ar Arzona, California, 

Colorado, Florida, Ilinois, Massachusetts, New York, Texas, and Washington. 

Interviews based on strctured discussion guides for each major program ara, as well as 

documentation furnished by FSA and State and local offcials, built the base of information for 

this report. This report represents the review conducted in the State of Washington and reports 

on its implementing the SLIAG progr as of August 1988. 
Both FSA and Washington were commtte to identiying problems and developing 

innovative and effective solutions for them. Immedately following our on-site visits, FSA 

was given an outline of the State concerns identied in this report. 

FINDING: Since 1987, FSA has held natonal conferences and issued information to 

States on implementing the SUAG program. 

The FSA held several national conferences beginning in 1987 to share 

information 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 Service (IS). 

FINDING: Washington took immediate steps to plan for and implement SLIAG. 

Viraly al progrm staf indicated that the task force established by the 

Secretar of the Deparent of Social and Health Services and chaied by the 

single point of contact was instrmental in planning for and implementing 

SLIAG. Ths task force brought all parcipating State components together to 

initiate action to get SLIAG underway. 

The State has established a bilingual toll-fr hotline for aliens to lear about 

SLIAG. This has helped the State to identi aras of concern that the alien 

population has about SLIAG. 

FINDING: The State has instituted a separate form in the normal enrollment process to 

meet program requirements concerning identifying school-age eligible legalized aliens. 

This form wil help protect confidentiity. 

Neverteless, there are some funds contrl vulnerabilties. 

FINDING: The FSA' s definition of public assistance includs some public health assistance activites which created administrative and servce delivery problems for Washington 

public health agencies.


FINDING: The FSA applicaton reviw process created a number of signifcant problems 

for Washington. Also, the FSA's applicatn reviw process interfered with the State 

ability to plan for serves. 
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 Washington in 

understanding SLIAG application requirements. 

The time frames were too short for submitting the initial SLIAG application 

review and comment, and revisions of the application. 

No formal appeals process exists if progrms or costs ar denied in the fIrst level 

review. 

FINDING: Conflicting interpretatons of the term "public charge" has caused uncertaintiesfor the alen populatin as to what services they are entitled to receive withoutfear of 

deportation. 

FINDING: At the time of the OIG review, several programs in the public assistance and 

public health assistance areas had not implemented effective methods to idntify eligible 

legalized aliens and document the costs for services rendered. 

FINDING: The providers which were rendering servces under contract with the Division 

of Public Health and the Offce of Superintendent of Public Instrction were not adequately and consistently obtaining informaton to verify the stas of eligible legalized aliens. 

As mentioned earlier, FSA and Washington have aleady initiated action on some of the 

recommendations in ths report. Steps have been taen by FSA to provide States with more 

specifIc, formal guidelines for identifying and documenting actual progr and admnistrative 

costs. However, FSA and Washington need to tae addtional actions in other aras as covered 

by the fidings in this report. 

RECOMMENDATION: The FSA should reconsider its position to classify certain public 

health servces as public assistance and make approprie adjustments to this position. 

RECOMMENDATION: The FSA should make its applicaton and grant award process 

more orderly. Specifcally, FSA should 

provide definitive wrtten instrctions on the SLIAG application requirements 

and inform Washington of SLIAG policy, compliance, and reportng issues to 

minimize the confusion that occur in the initial application process; 
ensure that sufficient time is allotted to the application process including 

Washington s initial application, FSA' s review and formal comment, 

Washington s 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 providing 

services are denied in the initial application process. 

RECOMMENDATION: The FSA and the INS should further clarify what is meant by 

public charge" and widely disseminate this information to the alien population who are 

concerned about their resident status. 

RECOMMENDATION: The State should develop procedures in public assistance and 

public health assistance to identify eligible legalized aliens and document the costs for 

services rendered. 

RECOMMENDATION: The State should ensure that its Division of Public Health and 

Office of Superintendent of Public Instrction are working with providers of services to 

obtain adequate and consistent documentation to verify the status of eligible legalized aliens. 

COMMENTS 

The FSA and the State of Washington both commented on the draft report and generally 

agreed with our fmdings and recommendations. Both indicated that steps have been taen to 

improve implementation of SLIAG. Their comments are included verbatim as Appendices B 

and C, respectively. 
.. 

.... ....... ..... ... ..... ... ....... ......... .... ... ... ... ..... 

II 

TABLE OF CONTENTS 

EXECUTIVE SUMMARY 

NTRODUCTIO N ..... ............ ........... ......... ....... II II.. II 1


PURPOSE .......... II"" II II".." II.. II".." II.."" 110............ II".. II".." IIII""".."".. II II.. II II.." II........ II""""" 1111II ..11..11.. II" II II"" g II II 1


BACKG ROU N D ....."8 liD.... ......11...............11.. II ....... ..IIID II
 111111 

METHODO LOG Y ....... ......... ..... 1111.. .......... ........ 11..11.. 
 .... .... 2


WASHINGTON' S ORGANIZATIONAL STUCTURE ................................... 3


FINDINGS AND RECOMMENDATIONS .................................................


PU B LIC ASSISTANCE..........IIII...11.........."II" ...11 ...8......11...111111..11.. ..1111111111811111111.11111111.011....
 II ... 

PUBLIC HEALTH ASSISTANCE ................................................................


EDUCA TIO N .....11...11....... .... ..0...................... .....................11.1111 ......11. .......... 1 0


CROSSCUTTI NG ISSU ES ......................................................................... 12


APPEN DIX A...,.... ...11....... ...... .e.... ...... .....11..11. II .... .... .....,..11....... ..... .... ... .11.. .... ........... .... A­


APPENDIX B . ...11...11..11...11..11.11...1;.. .11... .... ............... .11........ .1;.. .... .110.. ...11....... ....11............ B­


APP EN DI XC..... ....... ..... ..............11......................................... ..... ............ ....... ....... C­

INTRODUCTION


PURPOSE 

The Famy Support Admistrtion (FSA) reueste that the Ofce of Inspetor General 

(OIG) conduct an inspetion in nie States and the Distrct of Columbia to determe how 

effectively the States implemente the State Legalzation Impact Assistace Grts (SLIAG) 

progr awarde under the Imgration Reform and Control Act (lCA) of 1986. The 

inspetion included reviewig mehanisms in plac to identi these funds and determnig 

whether present or projected policies and proures adere to FSA guidelies. The FSA also 

was interested in identig potential problems early in the process and goo pratices which 

al States could shar. Ths report presents the results of the inspetion pertng to the State 

of Washigton. 

BACKGROUND 

Under IRCA, eligible legalze alens may apply for permanent residency within a I-year 

period afer they are fit eligible (i.e., by the 31st month after they receive temporar resident 

status). 

Ths new population wil incrase the demand for State public assistace and public health 

assistace servces signcantly. It wi also incras the demad for State educational 

servces as these new residents obta English language and civic skills neeed to become 

S. citizens. 

To help States defray may of the costs of providing public assistace, public health 

assistace, and educational servces to eligible legalize alens, IRCA authorize $1 billon 

each year from Fiscal Year (F 1988 thugh 1991 for SLIAG grts, less an amount 

identied as the "Federa offset." With few exceptions, eligible legalze alens ar ineligible 

for fedraly funded public assistace progr such as Aid to Fames with Dependent 

Childrn (AFC), foo staps, and Medcaid The "Fedral offset" is the estimated cost to 

the Fedral Government of providig these servces or benefits to those few legaliz aliens 

who ar eligible for them. In FY 1988, the law alocate $928. mion to States. 

To reeive SLIAG funds, States must apply to the FSA Division of State Legalization 

Assistace, which is responsible for approving applications and adnistering the program. 

The application must be approved in tota for a State to reeive any SLIAG funds. The FSA 

also provides States with tehnical assistace on policy issues and on the method used 

determne costs and veri actual costs. 
The basic reuirment for States to claim reimburement is that costs must be alowable, 

reasonable, and alocable. State public assistace and public health assistace program must 

be the same ones avaiable to the general public. States canot crate new program in these 

areas speifcaly for eligible legalze alens. However, States may create new or adtional 

education progrs for eligible legalze alens. States may also clai reimbursement for 

progr adstrtive and SLIAG adstrative costs. 

Reimburement for public assistace and public health assistace is lite only to the amount 

of State and local funds expende for SLIAG-relate costs. The maum SLIAG 

reimbursement for educational servces is an average of $500 per year per eligible legalze 

alien. Determnig progr adnistrtive costs is ma in accordce with the fmal 

regulation at 45 CP 402.22. 

The FSA is responsible for adnistering the program Because SLIAG was a new program, 

FSA real that problems would surace early in its implementation. In adtion to the 

norm diculties encountered in creatig new processes and proedurs, FSA recogn 

that SLIG would have unique problems. Some of these issues include the diversity of 

progrs which SLIAG encompasses, cultual and language baners associated with the 

service population mantag confidentiality of inormation, and the extrmely short tie fres for the grant award process. 

METHODOLOGY 

The FSA selected nie States and the Distrct of Columbia for the inspection beause of the 

varety of program offered the number of eligible legalze aliens in the population, or the 

amount of the grt. The nie States are Arna, Caorna, Colorado, Florida, llinois, 

Masachusetts, New York, Texas, and Washigton. Ths report reviews Washington 

implementation of the SLIAG progr as of August 1988. 

Pror to conducting the inspetion, the OIG develope strctu discussion gudes for each 

major program activity at the State and local levels. In conductig this review, intervews 

were held with the Washingtn single point of contat, and the progr managers and SLIAG 

coordiators at each individual program level. Because public health assistace, public 

assistace, and educational servces ar adistere at the State level, there were no county 

SLIAG adstrtors to interview. Many of the progrs were not implemented at the tie 

of our review; therefore, we were not able to intervew providers for public assistace or 

education. 
WASHINGTON' S ORGANIZATIONAL STRUCTURE


The Deparent of Social and Health Servces is the designate agency responsible for 

operating the SLIAG progr for Washigtn. The ditor of the Imgration Assistace 

Prgram, with the Division of Income Assistace, has ben appointe the single point of 

contat for the SLIAG progr. He wi be assiste by a fiancial maager from within the 

Ofce of Accountig Systems. Both managers have ben appointed ful-tie to adnister 

the SLIAG progr but wi reta their former position titles. Both the Income Assistace Prgr and the Ofce of Accountig Systems ar in the Deparnt of Social and Health 

Servces. 

The followig offces in the deparent make up the public assistace function for SLIAG: 

Division of Income Assistace, Division of Menta Health, Division of Medcal Assistace, 

and the Burau of Alcohol and Substace Abuse. 

The Deparent of Community Development, separte frm the Deparent of Social and 

Health Servces, provides weatherization, energy assistace, emergency foo and shelter 

servces to the State s genera population. These progrs ar include in the public 

assistace porton of the SLIAG progr. 

The Division of Public Health and the Burau of Parnt and Chid Health provide public 

health assistace servces to the State s genera population. The Burau of Parnt and Child 

Health is separte from the Division of Public Health. Neverteless, by SLIAG defmition, its 

services are included in the public health porton of the SLIAG progr. 

The Ofce of Superitendent of Public Instrction has overal responsibilty for the State 

SLIAG education progr. Within that Offce ar the responsibilties for coordiating adult 

education and kidergarn thugh gr 12 progrs. 
FINDINGS AND RECOMMENDATIONS


Both FSA and Washigton were commtted to identiying problems and developing 

innovative and effective solutions for them. Imediately following our on-site visits, FSA 

was given an outlne of the State concerns identied in this report. 

FINDING: Since 1987, FSA has held lUonal conferences and issued information to 

States on implementing the SUAG program. 

The FSA held several national conferences beginning 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 Service (IS). 

FINDING: Washington took immediate steps to plan for and implement SLIAG. 

Virally all progrm sta indicated that the task force established by the 

Secreta of the Deparent of Social and Health Services and chaied by the 

single point of contact was instrmental in planning for and implementing 

SLIAG. This task force brought al parcipating State components together to 

initiate action to get SLIAG underway. 

The State has established a bilingual toll-free hotlne for aliens to lear about 

SLIAG. This has helped the State to identify aras of concern that the alien 

population has about SLIAG. 

FINDING: The State has instituted a separate form in the normal enrollment process to 

meet program requirements concerning idntifying school-age eligible legalized aliens. 

This form will help protect confidentiity. 

Neverteless, there are some funds contrl vulnerabilties. Findings and recommendations 

concerning these vulnerabilties follow under major topic areas. 
PUBLIC ASSISTANCE 

Assistance or Service Activities 

The services provided under public assistace ar:


Supplemental Securty Income - State supplement payment 

Emergency Assistance (cash) 

Foo Stamp Program 

General Assistance for the Unemployable 

General Assistance for Pregnant Women 

Alcohol and Drug Rehabilitation Program 

supplemental food vouchers for Women, Infants, and Children 

Medical Assistance (non Title XI medical services) 

Weatherization Services 

energy assistance payments 

emergency shelter and emergency foo baskets 

Mental Health Services 

The State has not created any new progrs for SLIAG. As a result, the State wil incur 

increased administrative costs and wil have to institute new methods to identify eligible 

legalized aliens because the program definitions for public assistace and public health 

assistace ar unique to SLIAG. For example, within the Women, Infants, and Childrn 

progr, FSA defmes the food vouchers as a public assistance service, while it defmes the 

intae process, education. and counseling services as public health assistance services. The 

program wil have to add mechanisms to identify and separte work activities, thus increasing 

administrative costs. 

Documentation of Eligible Legalized Alien Status 

Programs under public assistance require that the Temporar Resident Card (also known as 

the 1-688 card) be used to verify that a client is an eligible legalzed alien. A copy of the 1-688 

card is maintained in the client s case me. The same intake process for the general public wil 

be used to process eligible legalized aliens and special agrcultural workers who apply for 

public assistance. Specifc codes wil be assigned for these aliens durg intae for 

identication and audit puroses. 

The Division of Income Assistance and the Division of Medical Assistace have issued 

instrctions to identify eligible legalized aliens. Program managers are concerned about the 
. . ,.

lack of diection from FSA and INS about what categories constitute being a public charge as 

defmed by the INS. Because the State has not received clear guidance it is unable to ease the 

fear of eligible legalzed aliens regarding which services wil jeopardize their resident status. 

Therefore, the State indicated that eligible legalized aliens are not applying for services they 

need and for which they are eligible. Most of the cals on the SLIAG hotline ar about the 

public charge issue. 

Program Costs 

For public assistance program, program costs wil be charged to SLIAG based on the actual 

count of eligible legaliz alens served. The Division of Income Assistace and the Division 

of Medical Assistace have proedures to captue program costs when an eligible legalized 

alien applies for assistace. Coded data identifying the eligible legalized aliens are put into 

the computer system and ar used to determne the progr costs applicable to ths population. 

Program costs within the Deparent of Community Development and the Bureau of Alcohol 

and Substace Abuse wi be incurd by contractors of services for the deparent. Progrm 

costs that ar alowable are specified in the contracts with the providers. A monthy 

expenditure report detais the expenditus by specifc categories. Policies and procedures are 

referenced in the contract and an annual audit is conducted to verify the appropriateness of 

expenditus. 

Program costs is one ara where many respondents said that FSA guidelines were too 

changeable. The State feels that FSA is holdig the State to arficial defmitions of what 

servces are to be claimed under public assistace versus public health assistance. The FSA 

provided guidance June 17, 1988, as to why some public health assistance programs are 

divided between public health assistace and public assistance. 

Administrative Costs


Durg implementation, al of the time spent by the single point of contact and fmancial 

manager wil be charged to SLIAG. The cost allocation plans and the indiect cost rates have 

not been revised for the program. New rates and plans wil be devised when programs are 

fully implemented. No progr has received notice as to when the single state audit wil be 

conducted since it is too early for this to occur. 

To document SLIAG staf costs, the Division of Income Assistace, the Division of Medical 

Assistace, the Deparment of Community Development, and the Burau of Parnt and Child 

Health use tie studies to calculate the amount of time spent by staf on all of the programs. 

The Division of Mental Health has awarded its contracts forthe year. The division is 

anticipating having to proess approximately 100 contrct amendments to implement changes 

for SLIAG. This wil cause additional admistrative costs due to the lateness of SLIAG 

fundig and the may changes in FSA instrctions. The State may be wiling to forego 
claiming SLIAG costs associated with processing eligible legalzed alens alady in the 

system and the progr sta-up costs aleady incurd. 

Drawdown of Funds and Cash Balances 

The fiscal analyst within the Offce of Accounting Services wil drawdown SLIAG funds for 

all the programs. The State s accounting system for SLIAG funds will not change. The 

Deparent of Social and Health Services uses a 32-digit account code which capturs each 

function within a program. The SLIAG activities wil be given their own account code. 

Programs wil claim SLIAG funds by two methods. For example, the Division of Income 

Assistace within the Deparent of Social and Health Servces progrs, wil fist submit an 

estimate of monthly expenditus to the Offce of Accountig Services. Each program wil 

input progr charges thugh the computer system using SLIAG codes. The financial 

manager withn the Imgration Assistance Unit wil review the summzed cost data for 

each program. Using ths and other inormtion, the fiscal analyst wil submit the amount of 

actual expenses to a fiscal management analyst withn the Offce of Accounting Services. The 

actual monthly expense data wil be compard to the expenses that were estimated for each 

progr area and adjusted. The adjusted figur wil then be drawn into each program 

account. 

The second billng method is by a monthly invoice for services rendered. This method is used 

by outside agencies or contractors providing services to the Deparent of Social and Health 

Services, for example, the Deparent of Community Development and the Offce of the 

Superintendent of Public Instrction. The invoices are reviewed and approved based on the 

contrctual agreement The State also has a budget and accounting system that requires 

contrctors to specify expenditues in each category of expenses and each source of income. 

Accordig to respondents, cash advances are generally not allowed in public assistance 

progrs. However, the Burau of Alcohol and Substance Abuse and the Deparent of 

Community Development wi permt advances for sta-up costs. Program receiving cash 

advances wil have to submit a plan specifying sta-up activities and their costs. Expenditures 

wil be verified and cash balances adjusted though the monthly reportng system and through 

an annual contrctor audit Each public assistance program audits its progrs annually. 

PUBLIC HEALTH ASSISTANCE 

Assistance or Service Activities 

The Division of Health and the Bureau of Parnt and Child Services provide the following 

services under public health assistance: 
immunizations 

AIDS testig, tratment, and education 

tuberculosis - preventive therapy and treatment 

screning, education, and referr for sexually trsmitted diseases, tuberculosis, 

adult dental disease, and diabetes 

Women, Infants, and Children - counseling, assessment, education, and referral 

servces 

Perinata Car Services 

Adolescent Pregnancy Planning Services 

These are ongoing services; no new servces have been implemented for SLIAG puroses. 

Documentation of Eligible Legalized Alien Status 

Public health assistance program may serve individuals who have applied for amesty as well 

as those who have achieved temporar or permanent resident status. 

The reviewers visited a cliic and a county health deparent. The representatives at the 

health deparent were having problems in obtaning documentation to veriy eligible 

legaled alen status. Patients often do not have the 1-688 card with them. Because patients 

are requested to retu with the 1-688 card, follow-up has become a problem. Another 

problem is language. Many of the eligible legalzed alens speak Spanish and very little 

English, and the health deparent does not have a Spanish interpreter. 

At the second provider site, the diector leared durng our visit that the health center had 

eligible legalized aliens as par of its patient population. The center had stared to implement 

procedurs to captu eligible legalized alien statistics and found none of their patients to be 

aliens. Later, recognizig that may of their patients speak Spanish and little English, they 

hird a Spanish-speakng outrach worker. The outreach worker found eligible legalized 

alens that were using the Women, Infants, and Childrn progr. 

In the State of Washington, special agrcultu workers with only a temporar work permit 

receive services and then leave the area. The provider is left without proof of eligible 

legalized alien status on which to substatiate a clai. The single point of contact has told 

providers to keep a list of the clients without 1-688 cards. He hopes to obtan the approval rate 

for special agrcultu workers who have applied for temporar resident status within 

Washington, and apply that rate to the number of special agrcultur workers served. 

The Division of Parnt and Child Health and the Division of Health expressed concern about 

veriying eligible legalized alien status. Historically clients have been able to receive services 

without declarng their citizenship status. Prgram managers are concerned that requirng 
clients to declare their citizenship status, whether they are legal or not, wil deter people who 

need the health services. 

Program Costs 

Under SLIAG, fundig for public health assistace is available for services that ar par of the 

State or local public health programs. Washington plans to use a population ratio formula to 

calculate specific State and local SLIAG-related costs. 

FINDING: The FSA's definiton o/public assistance includs some public health assistance activities which created administratve and servce delivery problems for Washington 

public health agencies. 

As noted above, FSA' s definition of public assistance encompasses some public 

health assistace activities, which created admnistrative and programatic 

dificulties for these agencies.


As a result of the FSA policy, to obtai reimburement for service costs, certain 

public health assistace programs wil have to identify individuals as eligible 

legalzed alens. The State staff feel this procedur may cause some individuals 

to forego avaiable servces. 

RECOMMENDATION: The FSA should reconsider its position to classif certain public 

health servces as public assistance and make any appropriate adjustments to this position. 

Administrative Costs 

The State is retractively identifying program admnistrative costs for progr implementation. Clerical and data processing support costs accred durg the star-up period 

wil be charged diectly to SLIAG. 

Cost allocation plans and indict cost rates wil be used for al program once the SLIAG 

progr is fully implemented. As with the public assistance progrs, no public health 

assistace program has received notice of the date for their single state audit since the 

programs ar not fully implemented. 

Drawdown of Funds and Cash Balances 

The procedurs for the drwdown of SLIAG funds are the same for public health assistance 

progrs as for public assistace. 
Most of the progrs with the Burau of Parnt and Child Health and the Division of Health 

deliver servces though contractors. The contrctors submit their invoices to the State 

progrs using the second billng method previously described. 

Cash advances ar not alowed in either program. Expenditues are verified, and cash 

balances ar adjusted thugh the monthly reportg system and though ongoing contract 

monitoring and review. 

Each public health progr, with the exception of the Parent and Child Health Services within 

the Burau of Parent and Child Health, is audite annually. The Parent and Child Health 

Services program is audited every 2 to 3 year depending on the staf availabilty. In addition 

to the audits conducted by each progr, the single point of contact plans to conduct its own 

fiscal reviews of the contrctor s billngs. 

EDUCATION 

Assistance or Serve Activities 

The services provided under the kidergaren though grade 12 program are bilingual 

education, English as a Second Laguage, and Technical Assistance for Bilnguals. The actual 

number of school distrcts eligible for SLIAG fundig of these services had not been determned. 

Education servces provided under the adult education program are English as a Second 

Language, civics, literacy, citizenship preparation, adult basic education, child care, and 

trsporttion. The SLIAG services for adults wil be provided by community colleges, 

vocational technical institutes, community-based organzations, and qualifed designated 

entities. Most of the contrctors will be in ru areas. At the time of review the Offce 

Superintendent of Public Instrction had not issued the request for parcipation to potential 

providers of services for adult education classes pending the receipt of SLIAG funding. Due 

to delays in SLIAG funding, the State was unable to provide the needed English as a Second 

Language classes in the cities of Wenatchee, Seattle, Yakma, and Tacoma. There is a 

two-year waiting list for adult English as a Second Language classes in Seattle. 

The State questions what ancilar services, other than child car and trsportation. are 

covered by SLIAG. The State wants outrach activities covered. 

Documentation of Eligible Legalized Alien Status 

The SLIAG program regulations will require the State to change its practice of biennually 

notifying schools not to ask students about their legal status. They wil now have to obtain 

this information from the students. However, to safeguard confidentiality, they wil use a 

separate form to document the status of eligible legalzed alens. 
Both adult education and kindergaren though grade 12 program plan for their enrollment 

procedurs to provide an unduplicated count of eligible legalzed alens. The schools wil 

keep a copy of the 1-688 card (Tempora Resident Car) in the student s fIe for eligible 

legalized aliens in kindergaren thugh grade 12 progrs. Adult education had not 

developed specifc procedurs at the tie of the review. 

Program Costs 

For kidergaren thugh grde 12 and adult education programs, the grantee number wil be 

assigned a SLIAG charge code to document program expenditues claimed. The contractor 

progr costs wil be the number of qualed students times the cost per hour ties the hours 

of attendace. The Offce of Superitendent of Public Instrction allows the contrctor to 

defme the methodology of monitorig attndace hour. 

Administrative Costs


The methodology for accounting admnistrtive costs for SLIAG program wil be the same as 

for al other State education progrs. A separte charge code for SLIAG wil be assigned to 

the contractor s grantee number for claimig costs. Both adult education and the kidergaren 

though grde 12 progrs use tie studies to alocate tie and resoures to the proper 

fundig source. 

The Offce of Superintendent of Public Instrction has dicted its contrctors to claim only 

dict admstrtive personnel costs up to a maximum of eight percent of total instrctional 

costs. Revision to the indiect charge rate wil occur once the program has been implemented. 

The SLIAG funds may not be used to cover State admnistrtive costs for education in excess 

of 1.5 percent of program costs. The actig SLIAG coordiator for the Office of 

Superintendent of Public Instrction states that the 1.5 percent cap wil not cover 

admnistrative expenses, once trvel for trning and program monitorig is added. The State 

Refugee Progr, Even Sta, adult basic education, and vocational trning progrs have 

covered SLIAG sta-up costs up to now. These costs include salares, equipment, travel 

outrach, and supplies. It wil cost the Offce of Superintendent of Public Instrction too 

much to go back and document what has been expended, especialy with the 1.5 percent cap 

on admnistrtive costs. However, he does not plan to request reimbursement for these costs. 

Drawdown of Funds and Cash Balances 

The Offce of Superintendent of Public Instrction wil follow the second biling method 

described under public assistace for the drwdown of SLIAG funds. The accounting system 

wil not be changed for SLIAG, although expenditurs related to eligible legalized aliens wil 

be assigned a separate allocation code for documenting costs. 
The Offce of Superitendent of Public Instrction does not allow contractors cash advances. 

Contractors ar reimbured on a services rendere basis. 

CROSSCUTTING ISSUES 

FINDING: The FSA applicaton reviw process creatd a number of signifcant problems 

for Washington. Also, the FSA's applicatn reviw process interfered with the State 

abilit to plan for serves. 

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 defmitive wrtten instrctions to assist Washington in 

understandig SLIAG application requirements. 

The time frames were too short for submittng the initial SLIAG application 

review and comment, and revisions of the application. 

No formal appeals process exists if progrms or costs ar denied in the fIrst level 

review. 

The State s SLIAG application was approved in a trsmittal letter of July 12, 1988 from the 

Deparent of Health and Human Servces. Subsequently, the State received its notice of 

grant award on August 16, 1988. 

The delay of SLIAG funding, along with the lack of clear instrctions about which services 

are covered by SLIAG funding, has delayed providing services to needy eligible legalized 

alens. Accordig to severa progr managers in public assistance, public health assistance 

and education, if State expenditues for eligible legalized aliens were reimbursed by SLIAG, 

the reimbursements could then have been used to provide services to other clients, some of 

whom are aleady citizens. 

Likewise, the delay of SLIAG fundig and operatig instrctions from FSA has resulted in 

higher admistrative costs to SLIAG. The Division of Menta Health, for example, has 

alady implemented its contracts for the new fiscal year. Once advised of the SLIAG 

program requirments the division wil have to amend over 100 contrcts. In addition, 

because of the delay in SLIAG funding, State funds have been used to implement SLIAG and 

hir staff in public assistance, public health assistace, and education. Many programs did not 
identiy work dedicated to SLIAG compliance, and these progrs wil now have difficulty identiyig the costs attbutable to SLIAG and requesting reimbursement. 

RECOMMENDATION: The FSA should make its applicaton and grant award process


more orderly. Specifally, FSA should


provide definitive wrtten instrctions on the SLIAG application requirements 

and inform Washigton of SLIAG policy, compliance, and reportng issues to mimie the confsion that occured in the initial application process; 

ensur that sufficient tie is alotted to the application process including 

Washington s initial application, FSA' s review and formal comment, 

Washington s consideration ofFSA 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 providing 

servces are denied in the initial application proess. 

FINDING: Conflicting interpretatons of the term "public charge" has caused uncertainties for the alien populatn as to what servces they are entitled to receive without fear of deportaton. 

Eligibilty workers in the public assistace programs and the public health 

assistace programs often cannot answer prospective clients ' questions about the 

effect of receiving assistance on their residency status. As a result, eligible 

legalized aliens are not applying for servces they need and for which they are 

eligible for fear of jeoparzig their citizenship status. 

Program managers are concerned about the lack of guidance from FSA and INS 

about what assistance categories constitute being a public charge as defined by 

the INS. Most of the telephone cals on the State s SLIAG hotline are about the 

public charge issue. 

RECOMMENDATION: The FSA and the INS shouldfurther clarify what is meant by 

public charge" and widely disseminate this informaton to the alen population who are 

concerned about their resident status. 

FINDING: At the time of the OIG review, several programs in the public assistance and 

public health assistance areas had not implemented effective methods to identify eligible 

legalized aliens and document costs for servces rendered. 

Many public assistance program were waitig to receive their SLIAG funding before 

implementing their parcular SLIAG programs. While fundig caused delays, the following 
progrms had not yet formulated procedurs to identify eligible legalized aliens and document 

client-related costs: Bureau of Alcohol and Substance Abuse, Mental Health ProgramCommunity and Institutional Services, and Deparment of Community Development. 

The Bureau of Parent and Child Health had not implemented the SLIAG progrm pending 

receipt of SLIAG funds. Therefore, no systems for identifying eligible legalized aliens or 

SLIAG costs have been implemented. The program managers for Women, Infants, and 

Childrn know that eligible legalzed alens ar a large par of the service population, even 

though procedures have not been set up to formly identify them. 

RECOMMENDATION: The State should develop procedures in public assistance and 

public health assistance to identify eligible legalized aliens and document the costs for 

services rendered. 

FINDING: The providers which were rendering services under contract with the Division 

of Public Health and the Office of Superintendent of Public Instruction were not 

adequately and consistently obtaining information to verify the status of eligible legalized 

aliens. 

The Division of Public Health uses the designations listed on the 1-688 card (Tempora 

Resident Card) to distinguish between eligible legalized aliens and special agrcultural 

workers durng the intae process. Instrctions had been issued to State staf and to health


providers by memorada and manual issuances, as well as conducting on-site trning sessions 

with many of the providers. Public health assistance providers were photocopying the 

medical examnation form or the I-688A card (Employment Authorization Card) to document 

that the patients were potential eligible legalized aliens. 

The Offce of the Superintendent of Public Instrction was, at the time of this inspection 

drafting the questions for its adult education grtees to use to identify an eligible legalized 

alien. The request for paricipation informs providers that SLIAG funds can be used to meet 

the educational needs of eligible legalized aliens. The providers ar instrcted to verify 

eligible legalized alien status by copying the 1-688 card, I-688A card, or 1-689 (Fee Receipt). 

However, the 1-688 card is the only card that establishes a student as an eligible legalized 

alien. 

RECOMMENDATION: The State should ensure that its Division of Public Health and 

Office of Superintendent of Public Instruction are working with providers of services to 

obtain adequate and consistent documentation to verify the status of eligible legalized aliens. 
OIG RESPONSE TO COMMENTS 

The FSA and the State of Washington both commented on the draf report. 

The FSA 

The FSA has generally agr with the OIG report findigs and recommendations. The FSA 

has taen a number of steps to improve implementation of the SLIAG progr including 

claryig program policies and proedures. The FSA has also clared severa subject areas 

and the State s organizational strcture descrbed in the drt report. 

The FSA questioned the statement that the new population would significantly increase public 

assistace and public health assistace services. Early estiates indicated that large numbers 

of alens would qualy to access the SLIAG program. The report recognized that information 

obtaed durg the review determned that substatial incrases in workloads and 

expenditus could occur in these aras as well as in education. However, we understad from 

recent discussions with States' offcials that demand for services is falling behind earlier 

projections. 

The FSA raised a question about the State s concern that increased adnistrtive costs would 

result because definitions of public assistace and public health assistace ar unique to the 

SLIAG progr. This State concern is viewed as par of the same issue regarding 

classification of some public health assistace activities as public assistance, which is 

addressed elsewhere in our response to FSA's comments. 

The FSA Refugee Resettlement Progr funds may have been used inappropriately. 

Apparently these funds were advanced to cover SLIAG sta-up costs but the State is not 

seeking reimbursement from SLIAG. This situation will be referred to the Offce of Audit, 

OIG, for furer review. 

The FSA questioned the allowabilty of costs for the bilngual hotlne established by the State 

for alens to lear more about the SLIAG progr. The FSA stated these costs could not be 

considered allowable program costs because the hotlne was not generaly available to the 

State s population. A recent contact with a State offcial indicated that the hotlne was 

established to respond to alien questions and concerns about al aspects of the SLIAG 

progr. The State considers these costs as SLIAG administrtive costs. These claimed costs 

as well as al of the State s claimed costs would, of coure, be subject to FSA's review. 

The FSA's definition of public assistace included some public health activities which created 

admnistrative and service delivery problems for Washington s public health agencies. The 

OIG recommended that FSA reconsider this position. 
The FSA replied that they see this priary as an issue of cost identication and that they wil 

work with the States to develop methods of documentig costs which are consistent with 

FSA' s responsibilties as stewars of public funds. We believe that FSA' s actions to identify 

alternative methods is responsive to our concerns. 

We continue to believe that a strct interpretation which permts public health costs to be 

claimed only for specific eligible legalzed alens is burdensome to the States and, in many 

cases, would require considerable revisions to the States' system or statutory requirements. 

However, we do agre that FSA's use of alternative systems, such as the Cost Documentation 

System and a revised population ratio method system which reflects usage, would be a 

positive effort to enhance cost effectiveness without requirg States to develop new systems 

or make considerable revisions to present systems. The population ratio method could be 

revised to consider not only eligible legalized aliens in the service population, but use of those 

services by the eligible legalized alien population based on information aleady obtaned from 

progr experience. Where appropriate, other alternatives might be used which would 

produce a more efficient system for the States and address congressional intent that the States 

would not be required to establish new or elaborate systems. 

The FSA questioned the report s statement that Washington had alady received an initial 

award letter and appropriations for the fIrst half of 1988 before its FY 1988 application had 

been approved. Upon contact with the State, we found that the SLIAG application had been 

approved fIrst before funds were given to the State. Modfications have been made in the 

report to reflect this information. 

We reported that no formal appeals process exists if program costs ar denied in the first level 

review. We agree with FSA' s statement that the Grant Appeals Board does have jurisidiction 

over matters for withholding and repayment of SLIAG funds. However, itwas the States 

concern that an effective appeals mechanism be in place for issues involving programs or 

costs at the fIrst level of FSA' s review in the application process. 

The FSA made numerous comments to clarfy certain matters of fact, policy, or procedure. 

We have included these comments verbatim in Appendix B. 

The State of Washington 

The State has generally agreed with the OIG report findings and recommendations. Their 

comments ar included verbatim in Appendix C. The State s comments also clarfied several 

processes described in the draft report. We have made some modfications in the report based 

on the comments received from the State. Since the time of the on-site review, the State has 

taken significant steps to effectively implement the SLIAG progr through procedural and 

system changes. 
APPENDIX A


GOOD PRACTICES

A number of practices have been identified that other States could shar. 

VIrually all progr sta indicate that the task force established by the Secretar of the 

Deparent of Social and Health Services and chai by the single point of contact was 

instrmental in the planning for and implementing SLIAG. This task force brought all 

parcipatig State components together to initiate action to get SLIAG underway. 

The State has established a bilingual toll-free hotline for aliens to lear about SLIAG. 

Ths has helped the State to identify aras of concern that the alien population has about 

SLIAG. 

The State has instituted a separte form in the normal enrollment process to meet program reuirements concernng identifying school-age eligible legalized aliens. This form

wi help protect confidentiality. 
APPENDIX B


FAMIL Y SUPPORT ADMINISTRATION'S COMMENTS

::/

: /. .. ..// . ,/. ./ .// ./ .,,.. :_

..,.W1Us 

DEPARTMENT OF HEALTH &. HUMAN SER	 FamilfSupport Administration 

MemorarRu", 

Date:	 September 22, 1989 

From: Acting Assistant Secretary 

for Family Support 

Subject:	 OIG Draf t Report: Implementation of the State Legalization 

Impact Assistance Grants Under the Immigration Reform and 

Control Act of 1986 - State of Washington (OAI-07-88-004 SO) 

To: 

Richard P. Kusserow


Inspector General


Attached are the Family Support Administration comments on 

the above report. Many of our coments are technical in 

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


response to our request to conduct this

round of rev iews of the SLIAG program. reports we 

received are very useful to us understanding how States 

received from you 	 in 

in 

are implementing the program. 

9 .. ?-(-t--L --sr.., 

Catherine Bertini


At tachmen t 
OIG DRA REPORT: 

Implementation of the state Legalization Impact Assistance
 Grants 

Under the Immigration Reform and Control Act of 1986 ­


state of Washington


The Family Support Administration I s comments are divided into three sections: Comments on background information and other 

narrative material that does not relate directly to the draft

report I s findings, comments on the findings, and responses to the 

draft report I s recommendations. 

Narrative: 

Page i (Executive Summary) -- The draft report says that SLIAG


funds may be used for "educational services designed to assist


eligible legalized aliens to attain a satisfactory level of


performance in school and to achieve English language proficiency


and citizenship skills necessary to become permanent residents.


The final report should make clear that, by regulation, SLIAG


funds may be used to provide adults any educational service


authorized by the Adult Education Act.


Page 1 (Background) -- The draft report says, "This new 

population will increase the demand for state public assistance 

and public health assistance services significantly. The draft report isn t clear whose conclusion this 7is 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


nei ther State and local pub ic health programs nor, wi th 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 health assistance services. Preliminary cost data 

from States suggests that newly legalized aliens are 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 

examinations required of all applicants for legalizations. 

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 

for public health assistance or public assistance services. 

Page 2 (Background) -- The draft report says that reimbursement


for public assistance and public health assistance "is limited


only to the amount of State and local funds expended for SLIAG-


related cost. SLIAG funds may be used to pay any SLIAG-related


cost, which is defined in regulation at 45 CFR 402. 2 as the


expendi ture of funds (whether State, local, or SLIAG) for any 

purpose for which SLIAG reimbursement would be allowable. The 
final report should make clear that state and local governments


are not required to spend their own funds before drawing down


SLIAG funds. 

Page 3 (Washington' s organizational structure) -- The draft 

report lists a number of services that the Department of 

Community Development, the Department of Public Health, and the 

Bureau of Parent and Child Health provide "to eligible legalized aliens. The final report should make clear that, by law SLIAG 

funds for only those public assistance and public health 

assistance programs that are generally available , i. e., in which 

being an eligible legalized alien does not impact on eligibility. 

Page 5 (Pulic Assistance) -- The draft report says, "The state 

has not created any new programs for SLIAG. As noted above, 

public assistance programs or activities must be generally 

available in order to receive SLIAG funds. Thus, the creation of 

new programs for SLIAG" was not an option to States. The final 

report should clarify this point. 

The draft report further says, "As a result, the state will


incur increased administrative costs and will have to institute 

new methods to identify eligible legalized aliens because the 

program definitions for public assistanc! and public health 

assistance are unique to SLIAG. We do not understand this 

sentence. Program administrative costs, i. e., the cost of 

administering an ongoing program, will not change as a result of

SLIAG. SLIAG administrative costs, i. e., costs incurred as a 

result of SLIAG, may be paid with SLIAG funds. The final report 

should clarify this point. 

Page 6 (Pulic Assistance Program Costs) -- The draft report


says, "The FSA had no written explanation as to why some public 

health assistance programs are divided between public health assistance and public assistance. In guidance issued June 17, 

1988, we explained in detail the statutory and regulatory cri teria for the two categories of services and gave detailed

guidance as to what kinds of acti vi ties met the criteria for each. The final report should make this point. 

Page 6 (Pulic Assistance Administrative Costs) -- The draft 

report says processing mental health contract amendments "to 

implement changes for SLIAG" will cause "additional 

administrative costs due to the lateness of SLIAG funding and the 

many changes in FSA instructions. It is not clear how costs 

will increase if there is no increase in staff. Nor is it clear 

why contracts would be amended as a result of SLIAG. The final 

report should address these questions. 

Page 8 (Public Health Assistance Documentation of Eligible


Legalized Alien status) -- The draft report says that " special agricultural workers with only a temporary work permit" receive


services, but the provider does not know whether they were


granted status. The draft report says the provider "hopes to

obtain the approval rate for special agricultural workers who 

have applied for temporary resident status" and apply that rate 

to "the number of special agricultural workers served. The 

point of this paragraph is not clear. The cost of public health assistance services (but not public assistance or educational 

services) provided to applicants is allowable, so providers would 

need only documentation that an individual had applied for status. For public assistance and educational services, we have 

made available to states methods for determining by a 

statistical adjustment the proportion of applicants who were 

granted status. The final report should make these points. 

Also on page 8, the draft report says that health providers are 

concerned "that requiring clients to declare their citizenship 

status, whether they are legal or not, will deter people who need 

the health services. Costs for programs or activities that meet 

the statutory and regulatory criteria for public health 

assistance can be established by' using a population ratio method. 

We have made available to States other methods to establish costs 

for public assistance and public health assistance programs that


do not involve checking the status of any program participant.


Among these is the Cost Documentation System, developed by FSA


with the cooperation of the Social Security Administration, the


Immigration and Naturalization Service, apd the General Services
 Administration, which allows 
 osts to be established by matching the social security numers of program participants with the 

social security numbers of newly legalized aliens. - The final 

report should make these points. 

Page 9 (Public Health Assistance Administrative Costs) -- The 

paragraphs under this heading appear to refer to SLIAG 

administrative costs rather than program administrativ costs. 

The distinction is important because SLIAG administrative costs 

may be charged in full to the State' s grant, while only a pro 

rata share of program administrative costs may be charged to the grant. The final report should make clear which kind of 

administrative cost is being addressed. 

Page 19 (Education Assistance or Service Activities) -- The


draft report says no new services have been added. But the


previous paragraph, apparently quoting State officials, says


that full services were not provided pending the flow of SLIAG


funds. The final report should make clear whether the State 

planned to fund services directed specifically to' eligible legalized aliens. Additionally, the draft report says, "The


State questions what ancillary services, other than child care and transportation, are covered by SLIAG. The State wants 

outreach activities covered. The regulation and written


guidance from FSA make clear that SLIAG funds may be used for any


activity authorized by the Adult Education Act, including


outreach. The final report should make these points.

. , 

..__ .

Page 10 (Education Documentation of Eligible Legalized Alien 

Status) -- The draft report says that schools will have to ask 

students about their legal status in order to document the number 

of eligible legalized aliens attending school. This is not true. 

It is possible for school districts to ask whether students are 

eligible legalized aliens , as defined by IRCA, without asking 

whether their status is legal or illegal. Those who are not 

eligible legalized aliens would include other aliens residing 

here legally and citizens, as well as undocumented aliens The 

final report should make that point.


Page 11 (Education Administrative Costs) -- The draft report 

notes that SLIAG start-up costs were covered in part by the 

"state Refugee Program, " and that the state educational agency 

does not plan to seek reimbursement from SLIAG for those costs. 

The final report should note whether Federal refugee assistance 

funds were used for this purpose and that, if so, this was an improper use of those' funds. (Eligible legalized aliens, by 

definition, are not refugees.


Findinas: 

Finding: Since 1987, FSA has held national conferences and 

issued information to states on implemen\ing the SLIAG program. 

Comment: Since the OIG' s ons-ite 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 have conducted initial program reviews of the 

maj or States and are in the process of planning further 

monitoring visits. We request that the final report reflect this continuing dialogue with States. 

Finding: Washington took immediate steps to plan for and 

implement SLIAG. 

Comment: Under this finding, on page 4, the draft report says, 

"The State has established a bilingual toll-free hotline for


aliens to learn about SLIAG. This has helped the State to


identify areas of concern that the alien population has about 

SLIAG. II It is not clear what kind of hotline this would be. 

noted above, only those public assistance and public health


assistance activities that are generally available to the 

population may be funded with SLIAG. (This requirement does not

apply to educational services. Thus, SLIAG funding has no 

direct relationship to the availability of public assistance and 

public health assistance services to eligible legalized aliens. 
Moreover, the cost outreach for public assistance or public 

heal th assistance programs directed specifically to eligible 

legalized aliens would not be allowable because it would not 

meet the "generally available" requirement. A later reference to 

the hotline, on page 5, states that most of the calls to the 

hotline relate to the circumstances in which acceptance of public 

assistance would lead INS to find that an individual was likely 

to become. a "public charge, " thereby becoming ineligible for 

permanent resident status. This reference would suggest that the 

hotline activity provides a service specifically for eligible 

legalized aliens. If so, costs associated with the hotline would 

not be allowable under the public assistance or public health 

assistance categories. Nor would the cost of an activity 

relating to the delivery of services to an individual be 

allowable as a SLIAG administrative costs. The final report 

should further describe this activity, whether its cost is an 

allowable use of SLIAG funds, and, if so, how it meets 

regulatory and statutory criteria. Also, in light of these 

questions, the OIG should consider whether to retain this


program on the list of "good practices" in the appendix.


Finding: The FSA' s definition of public assistance includes 

some public health activities. This created' administrative and 

service delivery problems for washington s public health agencies. 

Comment: We question how the definitions of public. health and 

public assistance create service delivery problems for state public health agencies. By statute and regulation, all programs or acti vi ties under both categories must be generally available. 

In practice, this means that SLIAG funds are available only to 

reimburse costs in ongoing, generally available programs. 

most programs, immigration status is not a condition of eligibility. (The draft report notes that undocumented aliens access public health assistance services. If the alien is 

eligible for services, he or she would receive those services

regardless of whether they were reimbursed under SLIAG. The 

final report should clarify this point. The final report also should explain .that the regulatory definitions of public 

assistance and public health assistance are based directly on 

section 204 of the Immigration Reform and Control Act of 1986 

(IRCA), which created SLIAG.


Programs of public assistance are defined as programs that


provide for cash, medical or other assistance.. desianed to 

meet the basic subsistence or health needs of individuals 

(section 204 (j) (2) (A) emphasis added). Consistent with IRCA' 

explicit inclusion of medical assistance under the public


assistance category, State or locally funded programs that


provide medical treatment to needy individuals are considered by


FSA to be public assistance.

IRCA defines programs of public health assistance as programs

which "provide public health services, including immunizations 

for immunizable diseases, testing and treatment for tuberculosis 

and sexually-transmitted diseases, and family planning services" (section 204(j) (3) (A)). These statutory definitions and the 

legislative history indicate that Congress intended to allow 

certain traditional public health functions under the public 

heal th assistance category and medical assistance to the needy 

under the public assistance category. In implementing SLIAG, we 

have followed that statutory framework. We have defined public health assistance as, among other things, programs or activities that "are provided for the primary purpose of protecting the 

health of the general public" (45 CFR 402. 2). The scope of programs included in that regulatory definition of public health 

assistance goes far beyond the specific activities listed in the 

IRCA . 

The public assistance/public health assistance categorization 

issue is primarily one of cost documentation requirements, not 

the allowability of costs associated with any particular health program. without the distinction between categories, Washington 

would likely use the population ratio method to establish costs 

for all programs ru by the their health departments. Implici t 

in this method is the assumption that el gible legalized aliens 

will access programs in the same frequency and at the same cost as the general population. We do not believe this assumption to 

be appropriate for medical assistance programs that provide 

treatment to needy individuals, i. e., what the tatute defines as a public assistance program. To the contrary, the information 

that we have to date indicates that allowing use of the 

population ratio method for these programs generally would 

overstate costs, dramatically in some cases. However, we would 

be willing to allow use of the population ratio method for any 

program for which there is an emDirical basis to indicate that


doing so would not overstate costs. 

FSA realizes that many public assistance and public health 

programs do not routinely collect information on immigration 

status but has found many do collect social security numers. 

That is why we funded and devoted substantial resources to 

developing a system that will match the social security numers 

of program participants with those of newly legalized aliens. 

This system gives states information on the numer of newly legalized aliens participating in a program and the cost of services to them. It is now available and allows states to 

establish costs for FY 1988 as well as current and future years. In May, we sent state SLIAG Single Points of Contact suggestions 

for other possible methods for establishing costs. None of these 

alternative methods requires setting up new administrative 

mechanisms or checking status of all program participants. 
We will continue to work closely with states to develop


methodologies to document costs for all programs in its approved
 applications. 

Finding: The FSA application review process created a number of 

significant problems for Washington. Also, the FSA' s application review process interfered with the State' s ability to plan for services. 

Comment: 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 timeframe 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. 

The draft report says no formal appeals process exists if 

programs or costs are denied. The SLIAG ':regulation provides 

that the Grant Appeals Board has jurisdiction over issues related to the witholding and repayment of funds. For other 

matters, States may follow normal procedures for disagreeing with

an agency finding. 

The draft report says that Washington was notified n in September


1988 that its FY 1988 application could not be approved because


it required revisions, even though Washington had already


received an initial award letter.... This caused a further delay


in the release of SLIAG funds. This statement is incorrect. 

State received FY 1988 grant funds until its FY 1988 application 

was approved. Applications under review during September 1988 were for FY 1989. The final report sh uld correct this error. 

Recommendations: 

Recommendation: The FSA should reconsider its position to


classify certain public health services as public assistance and


make appropriate adjustments to this position.


Response: As discussed above, the primary issue relating to the


definitions of public assistance and pUblic health assistance is


one of cost documentation. states would like to use the


population ratio method for all programs run by their health


departments. The final report should clarify whether the OIG is


recommending that we allow use of the population ratio in

programs where, as discussed above, its use would likely
 overstate actual costs. 

We believe that using the population method for all programs run 

by state health departments would be inconsistent with our 

responsibility to exercise fiscal responsibility in 

administering SLIAG funds. However, we recognize that some 

states may encounter difficulties in establishing actual costs, 

especially where ELAs are a small percentage of a State' 

population or for programs that few ELAs access. We will 

continue to work with states to ensure that a method is


available to allow them to establish actual costs for each 

program in their approved applications, consistent with our 

responsibilities as stewards of public funds. 

Recommendation: The FSA grant process should be made more

orderly. 

Response: This recommendation applies to the submission and 

processing of SLIAG grants only and should not be confused with 

the overall FSA grants management process. We have already made a numer of significant changes in the SLIAG application and 

grant award process. As the draft report indicates, the 

timeframes for the FY 1988 and FY 1989 application processes were 

necessarily short. In effect, the states and FSA 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 

deadline from July 15 to October 1. Additionally, we have 

encouraged states to submit as early as possible any new


programs, questions, or issues, and have advised them that they


may submit all or portions of their applications at any time. 


now provide in writing all our comments on states' submissions.


We issued extensive written guidance on the FY 1990 application


process and the standards we will apply in reviewing
 applications. 

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 application process. The 

Department' s Grant Appeals Board already has jurisdiction over 

cases involving the repayment or withholding of funds. Normal 

channels within the Department are open to states that disagree


wi th decisions made during the course of application review.


Recommendation: The FSA and the INS should further clarify what


is meant by "public charge" and widely disseminate this


information to the aliens who have raised concerns about their
 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. We note that the INS 

Phase II regulation clarifies this issue. Additionally, INS 

representatives have made presentations at virtually all of our


workshops and conferences. At 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 . e. 

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 lawlul temporary residents. tSuch use is 

not permitted under current law. 
r.­

APPENDIX C 

WASHINGTON' S COMMENTS 
,()( 

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Richrd J. Ttsm 

"t.. " ':Jf\ 

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P \ : i \:1' '. I \'.1) I !! \j !! I ", 1"\ !( 

Iii " :. " J., L \ , ;;;1 1'''' ' 

September 20, 1989


Mr. Richard Kusserow 

Inspector General 

Office of the Inspector General 

Washington, D. C. 20201 

Dear Mr. Kusserow:


The attached document is the state of Washington' s review and 

comment of the inspection report "Implementation of the State 

Legalization Impact Assistance Grants under the Immigration Reform 

and Control Act of 1986 - State of Washington" . I have suggested 

a number of changes for clarification and accuracy. 

While the state agrees with the bulk of the findings reported, and 

appreciates the recommendations offered, the time lag of over 

year between the inspection and the publication of the draft report 

makes it of little real use. The majority of issues identified in the report have already been dealt with out of functional 

necessity. 

Sincerely yours,


.4., 1'/' 

-1/ 1 "

,/ Ja es " Kai ber, Director 

Immigration Assistance Program

OB 31-A 

olympia, WA 98501 

Enclosure 
. 

Washington state


Comment on OIG Draft Inspection Report


OVERVIEW 

The stated purpose of the Office of the Inspector General t s (OIG) 

inspection of the implementation of the State Legalization Impact Assistance Grant (SLIAG) was to: . (a) Determine the effectiveness 

of Washington t s implementation of SLIAG, (b) identify problems 

early in the process and (c) to identify "good practices" ' to be 

shared with other states. 

The text of the report does identify problems in the process and
 lists three "good practices" however, no qualitative or quantitative analysis is made regarding the effectiveness of 

Washington t s implementation of the program. We feel that, 

considering the limitations placed on the state due to Federal 

delays and the lack of definitive policy and procedure at the time of the review Washington state responded effectively and 

efficiently to the entire SLIAG process. 

In addition to the omission of significant comment regarding 

Washington t s effectiveness in implementation" there are several 

areas of the report that are confusing or inaccurate. The following 

suggestions and comments are made on a page by page basis with the 

intent of helping the OIG to make the final document more useful 

to the state and Federal agencies invol ved. 

Executive Summary


The findings and recommendations in the executive summary are not 

paired. It would be easier to understand the recommendation as it 

relates to a finding if the recommendation immediately followed the 

finding. Additionally, numbering the findings and recommendations 

would help in referring to them. 

The duplication of the detail in the findings and recommendations 

in both the text of the report and in the summary seems to be 

redundant. We suggest that the findings and recommendations be 

combined and generalized in the executive summary. 

The comment following the third finding on page ii (also repeated on page of the report) "there are some funds control vulnerabilities" is a 
 vague statement that seems to indicate 

that the state must have difficulty in the control of the way it 

utilizes or accounts for the use of funds. There are, however, no 

specific findings reported that address this alleged deficiency. We have no idea what vulnerabilities the report refers to and have

no evidence that the states fiscal policies and accounting mechanisms have any lack of control or have vulnerabilities. This 

comment should be removed from the report and the preceding finding left as is. 
Washington state


Comment on OIG Draft Inspection Report


The fourth finding reported on page iii is not correct. Both the 

Division of Public Health and the Office of the Superintendent of 

Public Instruction verify ELA status of clients by making a copy 

of the INS documentation for the client file. 

The last sentence in the comment following the fourth finding on 

page iii states that FSA and Washington need to take " additional 

action in other areas" . Please be more specific as to what action 

in what areas, refer to a specific recommendation or remove the 

comment. 

Introduction 

In the fourth paragraph on page 1 you mention food stamps as being


among the programs for which Eligible Legalized Aliens (ELAs) are


ineligible. In fact ELAs who "Special Agricultural Workers " are


eligible for food stamps.


The second paragraph on page two is confusing 
 nd mixes unrelated 

statements about three subj ects in a single paragraph. Also, the 

last sentence in this paragraph is inaccur te. States do have to request approval of the methodology in determning SLIAG Administration costs.


Washinaton I S Oraanizational Structure


The first paragraph on page three is inaccurate in regard to positions and organizational structure. Please consider the 

following as a replacement:


"The Department of Social and Health Services (DSHS) is the agency


designated by the Governor to operate the SLIAG program in the


State of Washington. THe Division of Income Assistance within DSHS


houses the Immigration Assistance Program (IAP) which is directly


responsible for SLIAG activities. The director of the IAP is the


single point of contact for the SLIAG program. He is assisted by


a fiscal manager and program managers who are full-time staff.


Findinas and Recommendations


The comments under the third finding on page. 4 mention "funding control vulnerabilities" . Reference is made to further comment 

concerning these funding control vulnerabilities being contained 

under the maj or topic areas. However, after careful study of those 

findings and recommendations no detail or specifics can be found 

that concern fiscal or funding control or areas of vulnerabil i ty. 

This statement should be removed. 
Washington state


Comment on OIG Draft Inspection Report


The first paragraph on page 6 references an "annual audit" reality, contracted programs are monitored on an ongoing basis by .In

IAP program managers. Mention 


is also made on page 6 of the Single Audit in the third paragraph Act. Please consider including the following statement as an accurate description of how the Single


Audi t Act effects SLIAG:


assigned audit staff which conducts the annu


The independent Office of State Auditor has a permanently

the Single Audit Act. l audit required by
 This staff audits all large federal programs
 wi th a single year grant of seven million dollars or more. audit encompasses all This

(DSHS) programs and is a Department of Social and Health Service sampling of activity drawn from accounting/budgeting systems. DSHS Accordingly, it will be a potential sampling of SLIAG activities but not a 

financial/program activities.
 comprehensive look at

The third paragraph on page 6 should be corrected to indicate that


the costs of IAP staff will be charged to SLIAG for the full period


of the grant , not just during the implementation phase.


The last paragraph on page 6 mentions the financial manager. This


should be the fiscal anal vst 

The first three paragraphs on page 7 

consider using the following language: have inaccuracies. Please 

"Programs will claim SLIAG funds by two 

each program will input program charges through the computer system methods. In method one

using unique SLIAG account codes. The SLIAG financial manager with
 the Immigration Assistance Program will review the summarized cost


data for each program and submit the 
actual monthly expenditures
 to a fiscal analyst in the central Office of Accounting Services.


The actual monthly expenditure data will be 


year-to-date expenditure total and compared to SLIAG grant funds included in a grant


already drawn. The necessary revenue draw is prepared, and drawn from SLIAG then adjusted funds. 

The second billing method is by a monthly invoice for contracted services rendered. This method is used by contractors providing services to the 
 outside agencies or

Health Services Department of Social and

Development and the for example the Department of Community

Instruction. The invoices are 

Office of the Superintendent of Public staff and reviewed by Immigration Program


contractual agreement.
 approved for payment if in accordance wi th the

According to respondents, cash advances are generally not allowed


in public assistance programs. However
, the Bureau of Alcohol and


C..

, ,

I '


Washington state


Comment on OIG Draft Inspection Report


Substance Abuse and the Department of community Development (DCD) 

will permit advances for start-up costs. Programs receiving cash 

advances will have to submit a plan specifying start-up activities 

and their costs. Expenditures will be verified by DCD/BASA staff 

and reviewed by Immigration Program staff before payment is made. 

Immigration Program staff and other program/contractor staff will 

conduct field monitoring visits of these activities during the 

contracted period of performance. Some of these activities will 

be sampled and audited during the annual Single State Audit. 

The next to last paragraph on page 9 refers to annual contractor 

audit. This should be replaced with "ongoing contract monitoring

and review" 

Documentation of Status


The second paragraph on page 8 is incorrect. Public Health programs


may serve individuals who have only applied for amnesty as well as


those who have achieved temporary or permanent resident status.


Education 

The second paragraph on page 10 indicates that 11 of 293 school districts are eligible for SLIAG funding. The actuat number of 

eligible districts has not yet been determined. 

The third paragraph on page 10 mentions that SLIAG services will 

be provided by correctional facilities. This is in error as no 

correctional facilities are contracted to provide SLIAG services. 

The fourth paragraph on page 10 states that " no new services have 

been added" . This is in error. English language training and Civics 

training for ELAs is a new service and is allowable under the 

provisions of SLIAG. 

The third paragraph on page 11 is confusing in regard to the 8% 

administrative cost of a contractor' s total funding. Instead you 

should refer to the 8% of total instructional costs. 

Crosscuttina Issues


This heading, found on page 12, has no explanation about how and 

where these issues "crosscut" Many of the findings are duplicative 

of those reported elsewhere in the report. 

The last finding on page 13 indicates that some programs have not yet implemented methods to identify ELAs and, in the following 

comment, states the reason for the delay is that Federal funds to pay for .the development of those methods and procedures had not 
Washington state


Comment on OIG Draft Inspection Report


yet been received. However, the recommendation associated with that finding (page 14) states that the programs should go ahead and 

deve.lop the procedures and makes no mention of the delay in Federal 

funding. We feel the recommendation should be that FSA immediately 

fund the state so that development may begin. 

The fifth paragraph on page 14 is incorrect as it refers to Public 

Health program eligibility. SAWs are not treated differently from other applicants. All that is needed to be eligible for Public 

Health services is that an individual be an applicant under IRCA. 

The sixth paragraph on page 14 is also incorrect. Contrary to what 

is stated, the Office of the Superintendent of Public Instruction 

request for participation specifies that to be eligible a student 

must be an ELA, ie. must have been ad,justed to the status of 

temporary resident alien.