, .

IMPLEMENTATION OF THE STATE 

LEGALIZATION IMPACT ASSISTANCE 

GRANTS UNDER THE IMMIGRATION 

EFORM AND CONTROL ACT OF 1986 

STA TE OF NEW YORK

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OFFICE OF INSPECTOR GENERAL 

OFFICE OF ANALYSIS AND INSPECTIONS 

OCTOBER 1989 
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OFFICE OF INSPECTOR GENERAL


The mission of the Offce of Inspector General (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 methods to detet and prevent fraud, waste, and 

abuse. Created by statute in 1976, the Inspector General keeps both the Secreta and the Congress fully and cUIently informed about programs or management problems and recommends 

corrective action. The OIG perform its mission by conducting 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 are conducted in accordace with professional stadads developed 

OAl. These inspections ar tyically short-term studies designed to determne program effectiveness, effciency, and vulnerability to fraud or abuse. Ths study was conducted to determine the effectiveness of New York' s implementation of State Legalzation Impact Assistace 

Grants funds awarded under the Immgration Reform and Control Act of 1986. The report 

was prepared under the diection of Don McLaughlin, the Regional Inspector Genera of Region VII, Office of Analysis and Inspections. Parcipating 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 
IMPLEMENTATION OF THE STATE


LEGALIZATION IMPACT ASSISTANCE


GRANTS UNDER THE IMMIGRATION


REFORM AND CONTROL ACT OF 1986


STATE OF NEW YORK


Richard P. Kusserow 

INSPECTOR GENERAL 

OAI-07 -88-0044 OCTOBER 1989 
EXECUTIVE SUMMARY 

PURPOSE 

The purose of ths inspection was to determe how effectively New York implemented the 

State Legalization Impact Assistace Grants (SLIAG) program, to identi potential problems 

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

BACKGROUND 

The SLIAG progr 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 aliens. In Fiscal Year (F) 1988, $928.5 miion 

in progr fuds were allocated to States, and funds wi contiue to be alocated though FY 

1991. These fuds also cover admnistrtive costs for implementig SLIAG at the State and 

local levels. Payments are made for public assistace activities generaly avaiable to all 

needy individuals and public health assistace servces offered under the States ' public health 

progrs. The payments also cover educational servces designed to assist eligible legalzed 

alens to att a satisfactory level of performce in school and to achieve English language 

proficiency and citizenship skis necessar to become permanent residents. The Famy 

Support Admnistrtion (FSA) is responsible for admistering the program. 

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

implementation. In addition to the norm diculties encountered in creatig new processes 

and procedur s, FSA recognze that SLIAG would have unique problems. Some of these 

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

barers associated with the servce population, maintaing confidentiality of information, and 

the extremely short time fres for the grt award process. 

METHODOLOGY 

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

Offce of Inspector General (OIG) conduct reviews in 10 States to determne the progress of 

States ' implementing ths progr. The FSA selected nine States and the Distrct of 

Columbia because of the varety of programs they offere, the number of eligible legalzed 

alens in the population, or the amount of the grt. The nine States ar Arzona, Calfornia, 

Colorado, Florida, Ilois, Massachusetts, New York, Texas, and Washigton. 

Interviews based on strctu 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. This report represents the review conducted in the State of New York and report 

on its implementation of the SLIAG program as of August 1988. 
Both FSA and New York were commtt to identing problems and developing innovative 

and effective solutions for them. Imediately following our on-site visits, FSA was given an 

outline of the State concerns identied in this report 

FINDING: Since 
 1987 FSA has held national 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 

demogrphic data from the Imgration and Natualization Servce. 

FINDING: New York evaluated its ability to idntify eligible legalzed aliens, documented 

costs for serves, and took steps to ensure compliance with SLIAG requirements. 

The State Deparent of Social Servces instrcted local social service distrcts 

to identi and mantan a manual list of inormation on individuals who are 

determned to be eligible for SLIAG-reimburable assistace and services. The 

inormation would be maintaied in the client s record where it would be 

avaiable for enterig into the automated State/Federal Charge Indicators for 

Servce System, when the system is operational. 

In the New York City area, major educational servce providers were aleady 

par of a centrized data system known as "Alles." Plans were to mody this 

system to document costs for servces to identified eligible legalized alen 

students. 

FINDING: New York will use a wide network of educatonal serve providers, assess the 

educatinal stats of eligible legalized aliens, and refer them to appropriate programs. 

The State Deparent of Education wil use a wide varety of CUlent 

educational service providers, though contracts, to conduct SLIAG-related 

educational progr. These providers have proven their effectiveness in 

delivering instrction in English for speakers of other languages, citizenship, 

adult basic education, and high school equivalency for out-of-school youths and 

adults. 

To meet the parcular needs of eligible legalized alens, educational agencies 

receiving SLIAG funds are expected to conduct a pre-enrollment appraisal not 

only to acquir SLIAG-related eligibilty information, but also to assess 
English-speakng abilty and knowledge of the history and governent of the 

Unite States. Based on the apprasal, individuals wi be referred to appropriate 

progrs and program levels. 

Neverteless, there are some funds contrl vulnerabilties. 

FINDING: The State had not developed formal procedures for peridic reviews of cash balances. 

The Deparent of Social Servces, the grtee agency, had not formalzed a 

process to monitor cash balances that may occur as a result of interdeparenta 

transfers of SLIAG funds. 

FINDING: The FSA's definition of public assistance includes some public health assistance activies which created administrative and servce delivery problems for New York. 

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

for New York. Also, the FSA' s applicaton review process interfered with the State s abilit 

to plan for servces. 

Delay in FSA issuig 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 New York in 

understadig SLIAG application requirements. 

The tie frames were too short for submittig the intial SLIAG application 

review and comment, and revisions of the application. 

Implementig SLIAG-funded programs was delayed because of a signifcant 

delay in notiyig New York of the grt awar. 

FINDING: The State did not have methodologies in place to identify eligible legalized 

aliens to record costs for public assistance and public health assistance. 

FINDING: State interdepartental Memorandums of Understanding outlining each 

departenfs liability for SLIAG funding purposes had not been finalized. 
As mentioned earlier, FSA and New York 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 identifyng and documentig actual program and 

admnistrtive costs. However, additional actions ar necessar in other areas on the par of 

FSA and New York. 

RECOMMENDATION: The Departent of Socia Serves should develop and implement 

formal procedures to ensure that the departent is aware of cash balances that may exist as 

a result of interdepartental transfers of SLIAG funds. 

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

health servces as public assistance and make approprite adjustments to this positon. 

RECOMMENDATION: The FSA should make its appUcation and grant process more orderly. Specifcally, FSA should 

provide defiitive wrtten instrctions on the SLIAG application requirments 

and establish a dialogue with New York on SLIAG policy, compliance, and 

reportng issues to minimize the confusion that occured in the intial application 

process; 

ensur that suffcient tie is allotted to the application process includig New 

York' s intial application, FSA' s review and formal comment, New York' 

consideration of FSA comments and negotiation of disputes, and its submission 

of the revised application for FSA approval; and 

revise the grant award proess for approved applications so that the notice of 

grant award reaches New York prior to the beginning of the fiscal year. 

RECOMMENDATION: The Departents of Social Servces and Health should develop 

and implement a process to effectively identify indiviual eligible legaUzed aliens. 

RECOMMENDATION: The Stat should take the necessary action to finalize all Memorandums of Understanding so tha interagency responsibilitis can be clearly set forth and 

acted upon as necessary. 

COMMENTS 

The FSA and the State of New York both commented on the drt report They generaly 

agreed with our fmdings and recommendations. Both indicated indicated steps had been taken 

to furer implement the SLIAG program. Their comments are included verbatim in 

appendices B and C, respectively. 
........... 

TABLE OF CONTENTS 

EXECUTIVE SUMMARY 

NTRO D U CTIO N ... ...11........ ... ....... ......... lIe8 111111.. 8... II II..11.... II ... II 11"11 II ....11..11 II 11.11 II II.. II II II 11"11 11..11111111II II 11..11 II.. II II II II III .....


NEW YORK'S ORGANIZATIONAL STRUCTURE ........................................ 3


FINDINGS AND RECOMMENDATIONS ...80...0...11....1111...."...........8...,....111111..................... 4


Pu bl i c Assistance.. lie II... .... ... 11111111.. II"" ....... II...
It 11..11.......... 11.11.................. 11.11.............11.............. II" ... II" ..11 5


Pu bl ic Health Assistance... II......." ... II".."" 11111111 ..1... II..."".."".." 111111.11
 11.11......11 II"""." II"".."" ...11 7


Ed ucation ..... ... ....11....11... II .."11 ..11........ II.... II 11111111 11.11...... 111111 11....11.......... 11l111......111111..
 11.11........ 111111 


Crosscutting Issues ..1111.......11111111111101111.........11..11111111.......1111111111.,....11.....a.II.,................ 


OIG RESPONSE TO COMMENTS ...11.".......11.1111.....11..11..11110.....,..11.....11...111111..,........11.................0 


APPENDICES 

APPENDIX A: Good Practices......................................... ...................... A­


APPENDIX B: FSA' s Comments ...................................11........... ............ B­


APPENDIX C: New York's Comments ...,............................................... C­

INTRODUCTION


PURPOSE 

The Famy Support Admistrtion (FSA) reuested that the Offce of Inspector General 

(OIG) conduct an inspection in nine States and the Distrct of Columbia to determe how 

effectively the States implemented the State Legalzation Impact Assistace Grats (SLIAG) 

progr awarded under the Imgration Reform and Control Act (ICA) of 1986. The 

inspection included reviewig mechansms in place to identify these funds and determning 

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

was interested in identifyg potential problems early in the process and goo practices which 

al States could shar. Ths report presents the results of the inspection pertg to the State 

of New York. 

BACKGROUND 

Under IRCA, eligible legalize aliens may apply for permanent residency with a I-year


period afer they are fIrst eligible (Le., by the 31 st month after they receive temporar resident


status).


Ths new population will increase the demand for State public assistance and public health


assistace servces signcantly. It wi also increase the demand for State educational servces


as these new residents obta English language and civic skils needed to become U.


citiens.


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

assistace, and educational servces to eligible legalze aliens, IRCA authorized $1 bilion 

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

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

for federaly funded public assistance progrs such as Aid to Fames with Dependent 

Chidrn (AFC), foo stamps, and Medcaid. The "Federal offset" is the estiated cost 

the Federal Governent of providig these servces or benefits to those few legalizd aliens 

who ar eligible for them. In FY 1988, the law alocated $928.5 millon to States. 

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

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

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

also provides States with technical assistace on policy issues and on the methods used to 

determne costs and verify actual costs. 
The basic reuiment for States to clai reimburement is that costs must be alowable, 

reasonable, and alocable. State public assistace 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 legalize alens. However, States may create new or addtional 

education progrs for eligible legalze aliens. States may also claim reimbursement for 

progr admstrtive and SLIAG admistrative costs. 

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

of State and local funds expended for SLIAG-related costs. The maxum SLIAG 

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

alen. Determg progr adnistrtive costs is made in accordace with the fmal 

reguation at 45 CF 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 addition to the 

norm diculties encountered in creatig new processes and proedures, FSA recognizd 

that SLIAG would have unque problems. Some of these issues include the diversity of 

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

servce population, maintaing confdentiality of inormation, and the extrmely short time 

fres for the grant award process. 

METHODOLOGY 

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

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

amount of the grt. The nine States are Arzona, California, Colorado, Florida, lllinois, 

Massachusetts, New York, Texas, and Washington. This report reviews New York' 

implementation of the SLIAG progr as of August 1988. 

Pror to conductig the inspection, the OIG developed strctu discussion guides for each 

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

were held with offcials from the Deparent of Social Servces, the State Deparent of 

Health' s Division of Epidemiology, and the State Education Deparent s Burau of Adult 

and Continuing Education Progr Development Additional telephone discussions were also 

held. 

The visits were coordinated by staf frm the Deparent of Social Servces, Offce of Audit 

and Qualty Control. Pror to the on-site visit, materials furished by the Deparent of 

Social Services' Burau of Policies, Plans and Program were reviewed, as well as the 

application approved by FSA. Materials supplied by respondents were also reviewed. 
NEW YORK'S ORGANIZATIONAL STRUCTURE


The Deparent of Social Servces is responsible for the State s public assistace activities, 

and has been designated as the single point of contact and the grantee agency for the SLIAG 

progr. Day-to-day admnistrtion of the program is in the Offce of Famly and Chidren 

Servces, and the State s Refugee Coordinator has been negotiatig the application. 

The State Deparent of Health, which is responsible for State public health servces, is 

divided into two sections: the Offce of Health Systems Management and Public Health. The 

SLIAG health progrs ar admstered by the Division of Epidemiology, which is in the 

Public Health section. Each county has its own public health organation usualy headed by 

regional health deparent offcial. State-level sta deal dictly with individual county 

offcials. The ultiate responsibilty rests with the State. 

The admstration and supervsion of SLIAG-related education services rests with the State 

Deparent of Education and its Burau of Adult and Continuing Education Program 

Development The enti progr wil be admnistered at the State level. 
FINDINGS AND RECOMMENDATIONS


Both FSA and New York were commtt to identig problems and developing innovative 

and effective solutions for them. Imedately following our on-site visits, FSA was given an 

outle of the State concerns identied in ths report 

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

Stats 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 Imgrtion and Natuization Servce. 

FINDING: New York evaluated its ability to idntify eligible legalized aliens, documented 

costs for serves, and took steps to ensure compliance with SUAG requirements. 

The State Deparent of Social Servces instrcted local social service distrcts 

to identi and maintain a manual list of information on individuals who are 

determed by the State to be eligible for SLIAG-reimbursable assistace and 

servces. The information would be maitaied in the client s record where it 

would be avaiable for entering into the automated StatelFederal Charge 

Indicators for Service System, when the system is workig. 

In the N ew York City area, major educational service providers were aleady 

par of a centrze data system known as "Ales." Whe plans were to modfy 

ths system, the State has found it more expedtious for agencies to develop its 

own SLIAG data base for reportng and documenting costs. 

FINDING: New York will use a wide network of educatonal serve providers, assess the 

educatnal stas of eligible legalized aliens, and refer them to appropriat programs. 

The State Deparent of Education will use a wide varety of curent 

educational servce providers, though contracts, to conduct SLIAG-related 

educational program. These providers have proven their effectiveness in 

deliverig instrction in English for speakers of other languages, citizenship, 

adult basic education, and high school equivalency for out-of-school youths and 

adults. The providers include local educational agencies, postsecondar 

institutions, qualified designated entities, community-based organizations, and 
other public and private not-for-profit agencies, such as school distrcts, Boards 

of Cooperative Educational Services, libraes, and volunteer groups.


In order to meet the parcular needs of eligible legalied alens, educational 

agencies receivig SLIAG funds are expected to conduct a pre-enrollment 

appraisal not only to acquire SLIAG-related eligibilty inormation,but also to 

assess English-speakng abilty and knowledge of the history and governent of 

the United States. Based on the apprasal, individuals wil be referrd to 

appropriate programs and progr levels. 

Neverteless, there are some funds contrl vuerabilties. Findigs and recommendations 

concerng these vulnerabilties follow under major topic areas. 

PUBLIC ASSISTANCE 

Assistance or Serves Activitis 

The Deparent of Social Servces is responsible for State public assistance activities. These 

activities include: 

Emergency Assistace to Adults; 

Supplementa Securty Income (SSI); 

Home Relief, Foster Car, foo staps (adistration); 

Methadone Maitenance;


Residential Drug Free and Ambulatory Drg Free;


Outpatient -Tertar, Inpatient, Residential;


Ofce of Menta Retation and Developmental Disabilties; and


Alcohol Treatment and Rehabiltation program. 

No new SLIAG-relate programs were established in public assistace. The State 

responsible for such services. However, vendors and contrctors may be used. 

Documentation of Eligible Legalized Alien Status 

Pror to the avaiabilty of the StatelFedera Charge Indicators for Services System, local 

social servce distrcts were instrcted to identify and maintai a manual list of individuals. 

These persons ar determned to be eligible for SLIAG-reimbursable assistace and services 

as a result of an adjustment of their alen status under IRCA. This inormation will be 

maintaed in the client s record. For those eligible legalized aliens who ar eligible for 

Medicaid, a separte code wil be assigned, and it wil be added to the curnt system. 
Program Costs 

The Deparent of Social Services' Offce of Budget Management used the most recent 

expenditu data and client population estimates available to project progratic costs. The 

SLIAG application represents the deparent s best estiate of expenditus required for 

progr implementation. The State anticipates no major changes in the accountig system. 

The budget offce wil treat SLIAG as if it were a separte grant by giving the SLIAG 

progr its own cost center code. Clai wil be made agaist this code. 

Distrbution of funds between State agencies wi be based upon projection of costs and 

avaiable Federa funds. Prority in alocations wi be given to programs meetig the 

subsistence nees of the eligible legalze alien population and progrs providing language 

and citizenship instrctions necessar to adjust to imgration status. 

Mter Federa transfer of SLIAG funds to the Deparent s Federa Assistace Financing 

System, the Deparent of Social Servces wi effect a drawdown and initiate a certcation 

of fuds for the Division of the Budget On a monthy basis, the Deparentof Social 

Servces wi provide a conCUIent payment to the other State agencies based upon a stadad 

clai form. An ongoing conCUIent payment/reconcilation proess wi be performed by the Deparent of Social Servces. 

Actual expenditus wi be reonciled compiled, and adjusted annualy. Financialliabilty 

for inappropriate expenditus or nonuse of SLIAG funds, and consequently for any audit 

exception wi reside with each State agency receivig and expendig funds. Acknowledgig 

and acceptig this responsibilty is a condition of receiving funds. 

Administrative Costs 

At the tie of the on-site review, the deparent s indiect cost rate was 35.59 percent 

Personnel tie is prorated and the costs spread across the programs. Cost estiates in the 

application reflected State and local costs. These estimated costs are not duplicate between 

progrs and fees, and thir-par revenues have been elimnated frm these estimates. 

Detals of expenditus encompassed in the quarrly expenditu report submittd on ths 

and other progrs ar received in the Deparent of Social Servces for the comptroller 

prepartion of reports for components receivig SLIAG funds. There was no indication as to 

when the State wil be audited under the single audit progr. 

Drawdown of Funds and Cash Balances 

The details of the Memorandums of Understanding have not been finalzed, but it is expected 

that the drawdown of Federal funds will be no different than the curnt procedur. Under this 

procedur, the Deparent of Social Serviceslbudget offce would receive a grt award frm 

the U.S. Deparent of Health and Human Services (HS) and reflect the funds on a budget 
certcate. The fiscal sta would then drw funds on an "as needed" basis upon approval of 

the budget certcate. 

The procedur for interagency (interdeparental) transfer of funds agai is the same as for 

other Federa progrs. There are basicaly two ways that the transfers could be processed: 

The Deparent of Socia Services could subalocate funds by certcate and 

have a Memoradum of Understading in place with the afecte State 

agencies, or 

The Deparent of Social Servces could transfer monies by means of a joural 

voucher or speal charge voucher. Ths method of trsfer is generay covered 

though a Memorandum of Understadig. 

FINDING: The Stat had not developedfonnal procedures/or peridic reviews 0/ cash 

balances. 

As the grantee agency, the Deparent of Social Servces is responsible for the 

interdeparenta trsfer of SLIAG funds to car out the puroses of the legislation. The 

process of monitorig any cash balances that may be create as a result of these transfers is 

though accessing the New York State comptroller s termal. However, the State did not 

have form proedures in place to conduct periodc reviews of cash balances. 

RECOMMENDATION: The Departent 0/ Socia Serves should develop and implement 

/onnal procedures to ensure that the deparent is aware of cash balances that may exist as 

a result 0/ interdepartental transfers of SLIAG funds. 

PUBLIC HEALTH ASSISTANCE 

Assistance or Serve Activities 

The State Deparent of Health will provide servces and treatments related to sexualy 

trsmitted diseases, imunizations, prenatal car, famy planing, tuberculosis, mv testing, 

substace abuse, outpatient-priar and seconda, and alcoholism prevention. 

No new progrs were established because of the SLIAG fundig. Most of the programs are

adstered diectly by the State or thugh agrements with the individual counties. The 

counties may then have agreements with individual providers such as famy plannig, 

prenata car, and community health centers. 

The application process wil be no different for eligible legalized aliens than it is for other 

recipients of services. Curntly, the State is unable to document and identify the individual 

eligible legalized aliens that wil utiliz the services provided. The cUIent protocol is to serve 
anyone who requests servce regaress of alen status. Proof of alen status is not requested. 

Because of this protocol, the State wil continue to utiize the ratio method and wil exclude 

frm SLIAG funds dollars received frm other Federal programs. 

Program Costs 

FINDING: The FSA' s definiton o/public assistance includes some public health assistance activities which created administratve and servce delivery problems/or New York. 

The SLIAG progr reuirs that certn tertar level public health progrs be considered 

as public assistace. Ths reuirment has substatial impact for the State because it is now 

imperative to identi the individual eligible legalze alens so that costs can be documented 

for them. Ths reuirs extensively modfyg procedurs and may negatively afect alens 

seekig medical servces. State offcials were concerned that the FSA was not aware of the 

problems ths could create for the State. 

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

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

Administrative Costs 

Accordig to staf, the deparent s CUIent indict cost rate has not been approved 

Although the Memorandum of Understadig has not been fmalzed, the State believes that it 

wi not be necessar to mod the accountig system. Expenditus wil be documented by 

deparents as they ar reeived frm the contrctors. The Deparent of Social Servces 

deals diectly with the State Deparent of Health's Offce of Health Systems Management to 

discuss the bad debt and charty pool cases. The deparent wil use a formula approach 

whereby public health costs will be reimbursed with State and local dollars, and State 

reimbursement claied from SLIAG funds. 

Drawdown 0/ Funds and Cash Balances 

The Deparent of Social Servces provides funds to the Deparent of Health though 

quarrly certcates of trsfer. 

EDUCATION 

Assistance or Service Activities 

In New York, SLIAG funding for educational services wil be reserved for adult progrs, 

specifically language and citizenship preparation. Because of the small number of children 

who would be eligible to enroll in the SLIAG progr, no services wil be provided to 

childrn. 
Educational servces wil be provided to adults thugh local education agencies, 

postseconda institutions, qualifed designated entities, community-based organizations, and 

other public and private not-for-profit agencies that have shown their effectiveness in 

deliverig instrction in English for speakers of other languages and citizenship education. 

Anualy, the State Deparent of Education operates a program of adult basic education in 

English for speakers of other languages, and high school equivalency instrction for 

approxiately 115,00 out-of-school youth and adults. Prgrams are operated by school 

distrcts, Boards of Cooperative Educational Servces, postseconda institutions, libraes, 

community-based organzations, and volunteer grups. 

The State Deparent of Education planed to contrct with CUIent providers to conduct 

SLIAG-relate educational program. In some cases, the State Deparent of Education wil 

contrct with smaler providers though intermedares. It is anticipated that addtional 

providers wi parcipate in the program. The deparent will award SLIAG fundig to 

eligible agencies based upon submission and consideration of requests for proposal bids. 

Eligible agencies applyig for SLIG funds wil receive awards based on factors such as the 

number of eligible legalize aliens aleady being served, the number estiate to be served in 

the progr year, demonstrted effectiveness in providing English for speakers of other 

languages or citizenship instrction, reasonable costs relative to other applicant agencies, 

outrach referral, and comprehensiveness of planning with other agencies. 

In New York City, where an estiated 80 percent of the eligible legalze alens 


parcipate in progrs, $500 will purhase approxiately 111 hour of instrction. Thus,


SLIAG fundig alone should be suffcient to fund the needed instrctional program to meet


perment resident status.


Documentation of Eligible Legalized Alien Stats 

It is anticipated that agencies receivig SLIAG funds will conduct a pre-enrllment 

assessment to determne an eligible legalzed alen s abilty to speak and understand English 

and knowledge of the history and government of the United States. 

The pre-enrollment appraisal proess will provide informtion on students' educational 

history, demogrphic charcteristics, and data supportg their tempora residency status. 

Based on ths apprasal, each eligible legalizd alen will be referrd to appropriate programs 

and program levels. 

The students wi be identied with a centralze data system known as "Alles." It will be 

modfied thugh the Litera Assistace Center in New York City. The major providers are 

curntly par of this system. Servce providers receiving SLIAG funds periodcaly ar 

expected to report on the recipients, purose, and extent of such funding. 
Program Costs 

The individual requests for proposals wil address the issues of fundig to the parcular 

providers as well as the relate SLIAG costs not claimed for other progrs. Each individual 

provider is expected to fie a fisc or progr report. Sta from the State Deparent of 

Education wil perform desk audits, provide technical assistace, and monitor progrs on 

ongoing basis. 

The SLIAG funds ar disbured to the Deparents of Social Services and Education, and 

subsequently distrbuted to eligible agencies by provider contrcts. Advance payments ar not 

given to agencies under contrct The one alowable exception is for funded, not-for-profit 

agencies, who ar able to receive 12.5 percent advance payments. 

Agencies receivig funds under this program must collect and report data to document or 

veriy enrollent, attndace, progrss, certcation, and progr expenditus. Ths allows 

the deparent to monitor cash balances. At the time of the review, a Memoradum of 

Understadig between the two agencies to transfer SLIAG funds from the Deparent of 

Social Servces to the State Deparent of Education was nearg completion. 

Administratve Costs


The State Deparent of Education has confidence in the CUIent comptroller s accountig 

system and feels that addng SLIAG to the system wil not present a problem. Accordig to 

staf intervewed, the State Deparent of Education is the designated agency for determing 

an indict cost rate, which is a component of admistrative costs. 

The State Deparent of Education and the Deparent of Social Servces had not finalized a 

Memorandum of Understading regardig the Deparent of Education s liabilty and how 

the adstrtive costs will be dispersed. Plans ar to use the curent State comptroller 

procedurs for alocatig funds. Admistrative costs wi be funded from other components

with the deparent. Since ths is a short-term progr, the deparent is reluctant to 

incrase the number of sta for SLIAG. 

Drawdown of Funds and Cash Balances 

The Deparent of Social Services provides funds to the State Education Deparent though 

quarrly certficates of trsfer. 

CROSSCUTTING ISSUES 

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 submitted by 

July 1, 1988, and the FY 1989 application had to be submitted no later than July 15, 1988. 
Applications were to contan brief descrptions of the State progrs or servces, estimates 

of the State s SLIAG-related costs for each program or activity for that parcular fiscal year 

(including inormation on the number of eligible legalze alens residing in the State), and a 

brief explanation of the methodology used to estimate these costs. 

FINDING: The FSA application review process creatd a number of signifcant problems 

for New York. Also, the FSA's applicaton review process interfered with the State s abilit . to plan for servces.


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 New York in 

understading SLIAG application requirments. 

The tie frames were too short for submittg the intial SLIAG application 

review and comment, and revisions of the application. 

Implementing SLIAG-funded programs was delayed because of a signifcant 

delay in notiying New York of the grant award. 

The FSA has the responsibilty to review and approve or deny State applications for SLIAG 

fundig for designated program. The application approval is a key proess for the State since 

it must wait for FSA action to know which progrs have been approved for SLIAG funding 

puroses. 

RECOMMENDATION: The FSA should make its application and grant process more


orderly. Specifcally, FSA should


provide defitive wrtten instrctions on the SLIAG application requirments 

and establish a dialogue with New York on SLIAG policy, compliance, and 

reportg issues to miimize the confusion that occurd in the initial application 

process; 

ensur that sufficient time is allotted to the application process including New 

York' s initial application, FSA' s review and formal comment, New York' 

consideration of FSA comments and negotiation of disputes, and its submission 

of the revised application for FSA approval; and 
revise the grant award proess for approved applications so that the notice of 

grant award reaches New York prior to the begining of the fiscal year. 

FINDING: The State did not have methodologies in place to identify eligible legalized 

aliens to record costs for public assistance and public health assistance. 

The Deparent of Social Servces anticipates establishing a State/Federa Charge Indicators 

for Servce system to identiy and mantan information on eligible legalize alien status. The 

deparent had instrcted local social service offces to obtan information on applicants 

eligible legalzed alen status thugh a manual operation. 

The Deparent of Health is responsible for admistering al public health progrs, 

includig those progrs classifed as public assistace for SLIAG funding puroses. The 

deparent had not developed a proess or methodology to identify individual eligible

legaliz aliens so costs applicable to them can be identified. 

RECOMMENDATION: The Departents of Social Servces and Health should develop 

and implement a process to effectively identify indiviual eligible legalized aliens. 

FINDING: State interdeparntal Memorandums of Understanding outlining each 

deparenfs liability for SLIAG funding purposes ha not been finalized. 

The th entities involved in adsterig the SLIAG progr ar the Deparent of Social 

Servces, the State Deparent of Health, and the State Deparent of Education. Individual 

Memorandum of Understadig were being prepar to outle each deparent s liabilty. 

RECOMMENDATION: The State should take the necessar action to finalize all 

Memorandums of Understanding so tha interagency responsibilitis can be clearly set 

forth and acted upon as necessar. 
OIG RESPONSE TO COMMENTS 

The FSA and the State of New York both commented on the drt report 

THE FSA 

The FSA has generaly agr with the OIG report findings and recommendations. The FSA 

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

claryig program policies and proedures. In the report the State had severa concerns about 

how FSA adstered the progr. We have moded certn aspects of the report based on 

the comments received frm FSA. 

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

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

of alens would qual to access the SLIAG program. The report recogn 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 the demand for service nationally is falling 

behind earlier projections. 

The FSA's defition of public assistace included some public health activities which crated 

admstrative and servce delivery problems for New York public health agencies. The OIG 

recommended that FSA reonsider ths 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 method of documentig costs which ar consistent with 

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

alternative methods is responsive to our concerns. 

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

claied only for specifc eligible legalze alens is burdensome to the States and, in many 

cases, would reuie considerable revisions to the States' system or statutory requiments. 

However, we do agr 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 reuirg 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 servce population but also use of 

those servces by the eligible legalized alien population based on informtion aleady obtained 

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

produce a more effcient system for the States and address congrssional intent that the States 

would not be required to establish new or elaborate systems. 
We report that no formal appeals proess exists if program costs ar denied in the fIrst level 

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

over matters for withholdig and repayment of SLIAG funds. However, it was the States 

concern that an effective appeals mechanism be in place for issues involving program 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 procedur. 

We have included these comments verbati in Appendi 

The Stae Of New York 

The State has generay agreed with the OIG report fIndings and recommendations. Their 

comments ar included verbati in Appendix C. Two of the thee deparents (Social 

Servces and Education) indicated specific steps they have taken to fuer implement the 

SLIAG progr since the time of the on-site review. 

However, based on the comments received from the Deparent of Health, there is no 

indication that they have established a process to identify individual eligible legal alens. 

Ths process is necessar when certn public health assistace progrs ar considered as 

public assistace for SLIAG fudig. Claims for reimbursement of such costs would be 

improper where costs cannot be traced to individual eligible legalized alens. 
APPENDIX A


GOOD PRACTICES

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

In New York City, which has the bul of the State s adult education progrs, the State 

wi use a system known as "Ales" to identiy eligible legalzed alens and document 

costs for the adult education program. The eligible legalzed alens seeking educational 

servces have generay been identied, since ths system was in place prior to implementing the SLIAG progr. 

The State Deparent of Education wi use a wide varety of curnt educational servce 

providers, though contrcts, to conduct SLIAG-related educational progrs. These providers have proved their effectiveness in deliverig instrction in English for speakers of 

other languages, citizenship, adult basic education, and high school equivalency for outof-school youths and adults. The providers include local education agencies, postsecondar institutions, qualed designated entities, community-based organzations, and other 

public and private not-for-profit agencies such as school distrcts, Boars of Cooperative 

Educational Servces, librares, and volunteer groups, most of which are afilates of the 

Literacy Volunteers of New York State. 

In order to meet the parcular needs of eligible legaliz aliens, educational agencies receivig SLIAG funds ar expecte to conduct a pre-enrllment apprasal process. This 

process wi provide inormation on an individual's abilty to speak and understand English, knowledge of the history and governent of the United States, educational history, 

demogrphic charcteristics, and residency status. Based on the apprasal, individuals 

wi be referred to appropriate progrs and progr levels. 

Pror to the avaiabilty of an automated StatelFedera Charge Indicators for Servce System, the State Deparent of Social Servces instrcte local social servce distrcts to 

identiy and maitan a manual list of individuals determed to be eligible for SLIAG-reimburable assistace and servces. The list would include an individual's State identity 

number, alen registrtion number, legalization status, the date legal status was granted 

under IRCA, and the tye of benefits provided The information would be maintaied in 

the client s record where it would be available for entr into the automated system. 
APPENDIX B


FSA' S COMMENTS

.

; . ;:..

APPENDIX B


DEPARTMENT OF HEALTH II HUMAN SERVICES Family SuPPOrt Admlnlalratlon 

Office 01 Relugee Ruellemeni 

Refer to: Memorandunl 

ly 14. 1939
 Dall: 

From: Acting Assistant Secretary 

for Family Support 

Subject: OIa Draft Report: Implementation of the State Legalization 

Impact Assistance Grants Under the Imigration Reform and Control Act of 19S6 - New York .r-1I7- FI-1It: 't/ To: 

Richard P. 
 usserow

Inspector General


Attached are the Family Support Administration comments on


the above draft 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


received from 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.


erine BertJ.ni


Attachment

OIG DRAFT REPORT:


Implementation or the state Legalization Impact Assistance Grants 

Under the Immigration Reform and Control Act of 1986: 

NEW YORK 

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

population will increase the demand for state public assistance and public health assistance services significantly. II The draft 

report isn It 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 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 legalization. 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 pu lic health assistance or public assistance services. 

Page 2 (Background) -- The draft report says, "States must


develop a method acceptable to FSA fo determining administrative
 costs. II The final report should note" that several methods for determining: the share of administrative costs in ongoing programs that are allocable to SLIAG and which are acceptable a Driori are 

specified in the regulation at 4S CFR 402. 22 (b) . The process of

determining SLIAG administrative costs (those costs incurred in administering the SLIAG grant itself), like all costs associated 

ith administering HHS grants, is governed by 4S CFR Parts 74 and


92 and relevant OMB circulars.


Page S (Public Assistance) -- The draft report states, "No new 

SLIAG-related programs were established in public assistance. " It 

is important to note that all programs of public assistance must 

mpp hTee criteria. First they must be generally available to

the population of the State. Secondly, they must be means- tested. Lastly, they must provide for the subsistence or health 
of the individual. As noted above, the requirement that the 

programs be generally available would preclude the State from 

developing any prog ams for "eligible legalized aliens. The 

final report should make that point clear. 

Page 8 (Administrative Costs) -- The draft report says, "The 

Department of Social Services deals directly with the State 

Department of Health' s Office of Health Systems Management to 

discuss the bad debt and charity pool cases. II It should be noted 

that SLIAG funds do not pay for bad debt. 

Page 8 (Education) -- The draft report says, "Annually, the State 

Department of Education operates a program of adult basic 

education in English for speakers of other languages, and high 

school equivalency instruction for approximately 115, 000 out-ofschool youth and adults. It should be noted that the three-year 

rule limiting SLIAG reimbursement to students who have been 

enrolled in school for less than three complete academic years 

also applies to the "out-of-school youth" group. 

Page 10 -- The draft report says, "Advance payments are not given


to agencies under contract. The one allowable exception is for


private, not-for-profit agencies, who are able to receive 25


percent advance payment. II It is not clear if this is an


exception allowable only under contract or if the State is


generally allowing a 25% advance.


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. n 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: The FSA' s definition of public: assistance includes some 

public health activities which creates administrative 

and service delivery problems for New York. 
Comments:	 We question how the definitions of public health and 

public assistance create service delivery problems for 

New York public health agencies. By law and 

regulation, all programs or activities 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. In most programs, immigration status is not 

a condition of eligibility. If the alien is eligible 

for services, he or she would receive those services 

regardless of whether they were reimburse under SLIAG. 

The final report should clarify this point. 

The draft report notes that "there is no quarrel with 

the logic of FSA' s definition of public assistance versus public health, " but does not explain why the OIG 

recommends that FSA reverse its logic. The final 

report should explain that the regulatory definitions 

of public assistance and public health assistance are


based directly on 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.. . designed to meet the basic subsistence or 

heal th needs of individuals " (section 204 (j) (2) (A)

emphasis added). Consistent with IRCA' s explicit 

inclusion of medical assistance under the public 

assistance category, FSA considers state or locally 

funded programs that provide medical treatment to needy 

individuals to be public assistance programs. 

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) J. These statutory definitions


and the legislative history indicate that Congress


intended to allow certain traditional public health


functions under the public health 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 

publ ic 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 s90pe of programs included 

in that regulatory definition bf public health


assistance goes far beyond the specific activities


listed in IRCA.

.

,

.J '


Finding: 

.ILlI-=U C.s : 

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. 

Under our regulation, states are allowed to use a 

single ratio of the number of ELAs in the service 

population to the total service population to establish 

actual costs for public health assistance programs , as 

defined for SLIAG. Implicit in this method is the 

assumption that. eligible 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. 

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 
 empirical basis


to indicate that doing so would not overstate costs.


FSA realizes that many public assistance and public 

heal th programs do not routinely collect information on 

immigration status but has found that many do collect social security numbers. That is . why we funded and 

devoted substantial staff resources to developing a 

system that will match the social security numbers 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. Recently, we 

sent State SLIAG Single Points of Contact suggestions 

for other possible methods or establ ishing costs. None of these alternative methods requires setting up 

w administrative mechanisms or checking status of all


program participants.


We will continue to work closely with New York to


develop methodologies to ddcument costs for all


programs in its approved applications.


The FSA appl ication process created a numer of 

significant problems for New York. Also, the FSA I S 

appl ication review process interfered with the state I s 

ability to plan for services. 


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 Teport 

should note that, because of the way IRCA set up the 

allocation formula, one maj or 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 that "numerous policy
 misinterpretations and disagreements resul 	 ed because


FSA did not provide definitive written instructions to


assist New York in understanding SLIAG application


requirements. II Had there been more time, we would have 

communicated more extensively in writing Our current 

practice is to communicate in writing on all 

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 aver 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. 

Recommendations: 

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 appl ication 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 
 han 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

Addi tionally, 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. 

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 

wi th providing services are denied in the initial applications process. We do not believe such a process 

is necessary. The Department. s Grant Appeals Board has 

jurisdiction over cases involving the repayment or 

wi thholding of funds. Normal channels wi thin the 

Department are open to States that disagree with 

decisions made during the course of application review. 

Recommendation: The Departments of Social Services and Health 

should develop and implement a process to effectively 

identify individual eligible legalized aliens. 

Response: HHS has made a variety of options for tracking costs 

available to states. If it is not possible or cost 

effective for States to base their SLIAG related costs 

on an actual count of eligible legalized aliens 

accessing services, states may opt to use the Cost 

Documentation System, the population ratio method (for public health assistance), .or statistical sampling, or states may suggest al terna ive methods to HHS. 
. 

,,,

:... " 0 

APPENDIX C 

NEW YORK'S COMMENTS 
! .. , ,, ,., ,

APPENDIX C


EW YORK STATE


DI:PARTMEST Of SOCIAL SER\'ICES 

40 SORTH PEARL STREET. AlBASY, SEW YORK 11243. 

CESA A PE ALES 

rnn''''I'U')ft'f 

RE: You IP Rert on the Reiew of Stte I.ization Inct Asist Grt 
 (SUN) PICyLaI (#89-036, Formly 88-P.28) De Mr. 

illemtion is of th Stte Leization in 1" to yo Jun 19, 1989 rert on th Inct Asis Gr


of Heath (D:) am Prl:ei in Ne York Stte. We sh th rert with th Stte'
 Fdcation (SE) am ar attch thir cxDet

. your coidetion. for

(SUN) 

Depa. Her \t wil add thos I'lil-= ticn add to th inep Fir, \t trfer le: th fon to mr.itor of SLI fu.

identify eligible legized Se, in re alien in to deelcpin an ord bpler a prns

asist proide to rerd cx for pulic

base on p:ation , \t alredy sutt a P claiJ methodolog, Assis ratios, to the Feder Division of Stte Leization

to us eith th (ISIA) for appro. If tht apprc is mt given so, we plan Co 

methodolog for claiJ 1988 co.tian Syst or a sttisicaly vaid 

AN EOUAL OPPORTUNITY/AFFIRMATIVE ACTION EMPLOYER 
Page 2


Mera Finly, relative to th Ialertion tht all integen of t1 

agenies inlved in SLI p.lic asis clai. (Ks) be finized,
 ne have in place an M: with SE ar ar d.evel in a stzed KX for al ot Stte 

'I yo for shin th report with us an tr ou c:ts adeqtey add you co. 

:'1./ 

O:ssion./ 

Mr. Rich P. Inr 

Dept. of Heth "an Hl seice 

Office of Inr Ro 5250 

Wasn, 200 Irepen Aven S.

D. C. 20201 

Attadm 
.,;,;,; , . 

, , . .. :. . ,!:j )\, p. . ,., ,:. 

:ib1%1 1f1P STATE OF NEW YORK 

. ':t4' ,. "i- DEPARTMENT OF HEALTH 

Corr":-'9 T':.'/er It'0 G' . N/ 'I' )LV' )!er f r"";)r ,;. P;.' t.;I);jr. "'lCo'. " ?2::­

'r ': ' ' I.


, . I . I . :. 


i)' l:"1 :" 

July 20. 1989


Joseph P. Ferrone


Director 

Bureau of Pol icies. Plans and Programs


Office of Audit and Qual i ty Control


NYS Department of Social Services


40 N. Pearl Street


Albany. New York 12243-0001


Dear Mr. Ferrone: 

' on 

Department of Health staff have reviewed the audit Overall, 

implementation of the State LegalizatiOn Impact Assistance Grant. 

the report reflects accurately the comments and concerns raised during the The 

meeting with OIG officials by Department of Health representatives. 

report acknowledges the problems inherent in the Family Support 

Administration ' s (FSA) management of the program. The lack of coherent 

commni cat ion between DHHS and 

rules. the dearth of guidance and the poor fficul t to 

the states has made a compl icated program infinitely more di 

manage. The specific recommendations which apply to the Department of 

Health , warrant several comments, 

Recorrendat ion: 

The FSA should recons.der its position to classify certain public


heal th services as public assistance and make appropriate adjustments to


this position.


Comment: 

The Department of Heal th agrees with the recommendation. Programs 

ow require a tracking system to identify classified as public assistance-

(EtA) using the service. Programs individual eligible legalized aliens


ssistance can be reimbursed using the ratio
 approved as public health


method. Individual identification of EtAs is impossible because legal 

status is not routinely asked when public health services are provided. 

Inclusion of this question could act as a disincentive for program of a service,
 enrollment of those individuals most in need '


o see the concept of "publ i c 

The Department of Health would 1 ike 

rams des i gnared as publ ic 

heal th" expanded by the FSA to include all pro 

heal th by the State. The FSA staff deterining which programs are el igible 

ing in public health, Public 

under the public health category have no 


health programs provided by the Department and available to New York


residents (whether ElAS or not) should all be eligible for reimbursement


under the heading of public health assistance.

Recorrendat ion: 

The Departments of Social Services and Heal th should develop and
 implement a process to effectively identify individual eligible legalized
 al iens, 

Coment: 

This focuses on the same issue discussed. above. Identification of ELAs is incompatible wi th the Department' s posi tion of providing service to all individuals regardless of their legal status, Even if a method could be dev ised, it would not be cost-effective. The difficulties associated 

wi th designing and implement ing a tracking system are formidable. It would 

be simpler and less costly to use the ratio method of determining 

reimbursable costs. If the FSA redefines some programs as publ ic health 

assistance rather than public assistance, the issue of identifying


individual ELAs will be moot.


Thank you for sharing the audit report with us. 

Robert W. Reed


Director 

Fiscal Management Group


dIp 

cc:	 Mr. Leavy 

Mr. VanDeCarr 

Dr. Novick 

Ms. Buckley 

Ms. Klein


Ms. Carlton


Page 2

. . ... .. ,. . y, 

II,. W.k 

THE STATE EDUCATION DEPARTMENT. 

EXECUTIVE DEPuTY CDMMISSIO"-ER OF EDUCATION 

: i \ Y. 

11F. !M4T( 0. 

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2::;.. 

THE NEw YORI( STATE EOVCATION DEPARTMENT 

ALBANY, NEW VORl( '2234 

July 13, 1989 

Joseph P. Ferrone


Di rector 

Bureau of Policies, Plans


And Programs 

Office of Audi Control t and Qual 


New York State Department


of SocIal Services


40 North Pearl Street 

Albany, NY 12243-0001 

Dear Mr. Ferrone: 

In response to your June 29, 1989 letter, we have reviewed

General' 

the June
 1989 draft copy of the U. S. Office of Inspector

of State Legalization Impact (OIG) audit report on New York State s implementation

The State Education Department'Assistance Grant (SLIAG) funding. s (SED) reactions are as follows: 1. On pages 4, 9, and 13 of the draft report, while OrG is correct in saying that plans were being discussed to modi fy the central "ALLIES" data base, since then each of the four

develop its 

major education agencies has found it more expedi tious to

documenting costs. .
 own SLIAG data base for pro, ram reporting

2. On page 10, the "cash advance " provided is 12 25%, and this was made available to 1/2 not

all funded not-for­ prof! t. - agencies.

Understanding 3. Wi th egard to expedi tin, the Memorandum of

Department of (MOU) for FY 90 funding, SED and State Social Services (SDSS) have already begun discussions to assure that the MOU will be completed early enough to enable all contracts place by October 1, and subcontracts to be in 1989. s incl udes issuance of a continuation application which is to be returned by July 28,

discussions on the FY 90 

identification of rollover funding, and interagency funding level for SED. 
",I 

4", 

t'fI 

e are pleased 4. 

Cood Prac:tices that SED extensively cited set:lion of Ule reports. 	 This is in the
 particularly 

impl 

elcomc inis 

light of the difficult emen la t i on prubl ems posed by the SLIAC program. 

I hope these comments are responsive to YOur 


request. 

Sincerely, 

Thomas E. Sheldon


vmc 

cc:	 James A. Kadamus 

Russell J. Kratz 

Robert Purga 

C-b 
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