The Adoption Incentive program (Section 473A of the Social Security Act) provides federal payments to state child welfare agencies that increase adoptions of children who are in need of new permanent families. Generally, these are children for whom reuniting with their biological parents is not possible and who would otherwise be expected to remain in public foster care until they "age out" (i.e., reach the state age of majority or the age at which state custody of children in foster care is ended). The first Adoption Incentive payments were made to states in FY1999 based on improvement in the numbers of adoptions completed in FY1998, and the most recent were announced in late FY2013 (August 2013) based on improvements in the numbers of adoptions completed in FY2012. Since the inception of the program, states (including the 50 states, the District of Columbia, and Puerto Rico) have collectively received close to $424 million in federal incentive payments for increased adoptions. The Adoption Incentive program was most recently extended through FY2013 by the Fostering Connections to Success and Increasing Adoptions Act of 2008 ( P.L. 110-351 ). However, as part of the Consolidated Appropriations Act, 2014 ( P.L. 113-76 ), Congress extended states' eligibility to earn adoption incentive payments for an additional year and appropriated $37.9 million to make those payments. Legislation to reauthorize and extend the Adoption Incentive Payments program through FY2016 has passed the full House ( H.R. 3205 ) and was approved in the Senate Finance Committee (Title I of S. 1870 ). Title II of H.R. 4980 , introduced on June 26, 2014, draws on language in both of those legislative proposals. In addition to extending funding authority for incentive payments through FY2016, Title II of H.R. 4980 would make changes to the incentive structure established in the 2008 law—including by changing the award categories to focus more on permanency for children 9 years of age or older, establishing incentive payments for states that appropriately move children from foster care to legal guardianship, determining improvements in state performance based on the rate (or percentage) of children leaving foster care to adoption or guardianship (rather than the number), and putting additional focus on achieving permanence through adoption or guardianship for older children. Apart from reauthorizing the Adoption Incentive program, the Fostering Connections to Success and Increasing Adoptions Act of 2008 made several other changes to federal law, which Title II of H.R. 4980 would amend or otherwise address. Specifically, the bill would extend $15 million in annual mandatory funding for Family Connection Grants for one year (FY2014); that grant program was first established and funded in the 2008 law; adjust eligibility criteria for Title IV-E kinship guardianship assistance (which was first established in the 2008 law) to ensure continuous program eligibility for a child who must go to live with a "successor guardian" due to the incapacitation or death of his/her relative guardians; seek to further ensure siblings have the opportunity to live together while in foster care, by specifying that a 2008 requirement for state agencies to identify and give notice to grandparents and other relatives of children entering foster care includes identifying and providing notice to any parent of a sibling of a child entering care (provided that parent has custody of the sibling); and require additional reporting by states to ensure they spend any savings resulting from the expanded federal support for Title IV-E adoption assistance provided for in the 2008 law, and require that no less than 30% of any identified savings be used by the state to provide post-adoption or post-guardianship services and services to ensure safety and well-being of children who might otherwise enter foster care. This report begins by describing in greater detail the legislation under consideration in the 113 th Congress that would reauthorize and extend the Adoption Incentive Payments program and make additional child welfare-related changes described above. ( Appendix A includes a table comparing current law with several reauthorization proposals, including Title II of H.R. 4980 .) It also discusses hearings and other legislative actions taken in this Congress as part of the reauthorization effort. Additionally, the report provides background related to the Adoption Incentive program, including a discussion of the long-standing congressional interest in domestic adoption, the significant increases in adoption from foster care that have occurred since the mid-1990s, and the Adoption Incentive Payments program as it has functioned since the program's 2008 reauthorization. Throughout this report some unique terms related to adoption, foster child adoptions, or the Adoption Incentive program are used (e.g., "special needs" and "adoption rate"). While each of these terms is explained in the body of the report, for ease of reference they are also included in a "Glossary of Terms" provided in Appendix B to this report. On June 26, 2014, Representative Camp, with Representatives Levin, Reichert, and Doggett, introduced the Preventing Sex Trafficking and Strengthening Families Act ( H.R. 4980 ). The bill's introduction was jointly announced by Representatives Camp and Levin, along with Senators Wyden and Hatch, and was described as "bipartisan legislation [that] reflects agreements reached between the House and Senate negotiators." Title II of H.R. 4980 draws on provisions included in both the Promoting Adoptions and Legal Guardianships for Children in Foster Care Act ( H.R. 3205 , introduced by Representative Camp, with Representatives Levin, Reichert, and Doggett), which was passed by the House in October 2013, and Title I of the Supporting At-Risk Children Act ( S. 1870 ), which was approved by the Senate Finance Committee in December 2013. (The Title I provisions of S. 1870 were also introduced in S. 1876 , the Strengthening and Finding Families for Children Act, which was introduced by Senator Baucus, with Senators Hatch, Wyden, Rockefeller, Grassley, and Casey.) H.R. 3205 and S. 1870 , in turn, drew on other introduced bills, which sought to extend Adoption Incentive Payments and/or make other amendments to child welfare law. In the 113 th Congress, these bills included the Guardians for Children Act ( H.R. 2979 , introduced by Representative Doggett, with Representatives Danny K. Davis, Bass, Lewis, Rangel, McDermott, and Blumenauer); Investing in Permanency for Youth in Foster Care Act ( H.R. 3124 , introduced by Representative Danny K. Davis); Removing Barriers to Adoption and Supporting Families Act of 2013 ( S. 1511 , introduced by Senator Rockefeller, with Senator Casey); Supporting Adoptive Families Act ( S. 1527 , introduced by Senator Klobuchar, with Senators Landrieu and Blunt/ H.R. 3423 introduced by Representative Langevin, with Representatives Wittman, Frederica Wilson, Sean Patrick Maloney, Norton, Bass, and Grimm); and the Sibling Connections Act ( S. 1786 , introduced by Senator Grassley, with Senator Kaine). This section describes Title II provisions of the Preventing Sex Trafficking and Strengthening Families Act ( H.R. 4980 ). For a comparison of these Title II provisions to current law and provisions included in H.R. 3205 and S. 1870 / S. 1876 , see Appendix A . The Adoption Incentive program was authorized to receive up to $43 million in annual appropriations through the end of FY2013. Despite the expiration of funding authority, Congress chose to provide $37.9 million in FY2014 appropriations for these payments ( P.L. 113-76 ). Title II of H.R. 4980 would renew discretionary funding authority for the program, renamed as Adoption and Legal Guardianship Incentive Payments, at the current annual level ($43 million) through FY2016. The proposed three-year reauthorization time frame would align the funding authorization for the incentive payments program with the funding authorizations provided for two child welfare programs authorized under Title IV-B of the Social Security Act (Stephanie Tubbs Jones Child Welfare Services and Promoting Safe and Stable Families). Title II of H.R. 4980 would revise the categories for which states may earn incentive payments, expanding them to include exits from foster care to legal guardianship and placing additional focus on states' abilities to appropriately move children age 9 or older to permanent homes via adoption or guardianship. It would retain an award category for improving foster child adoptions and add a separate award category for foster child guardianships. Awards in these categories would be available with regard to adoptions and guardianships for children of any age. Additionally, H.R. 4980 would split the current "older child adoptions" award category into two groups and add foster child guardianships to both categories. The two new award categories would be for adoptions and foster child guardianships of children ages 9 through 13 years (defined as "pre-adolescent" adoptions and guardianships) and for those aged 14 or older (defined as "older child" adoptions and guardianships). Finally, H.R. 4980 would eliminate the award category tied to adoptions of children less than 9 years of age who are determined by their state to have special needs. Further, H.R. 4980 would base all awards on improvements a state makes in the rate (or percentage) of children moving to adoption (or guardianships). An improved rate would mean that the percentage of adoptions (or guardianships) achieved in the fiscal year for which an incentive payment is being determined is greater than the percentage achieved in the baseline year. Under H.R. 4980 , a state's baseline year would be either the fiscal year immediately preceding the one for which the award is being determined, or the average rate for the three fiscal years immediately preceding the year for which the award is being determined, whichever has a lower rate . (Effectively, this means awards would be based on whichever of these two rates produces the greatest measured improvement.) Comparing percentages (or rates) to determine improved performance—instead of using the absolute numbers of adoptions achieved as is currently done in this program—removes the effect of overall caseload changes from the measurement. For states with declining numbers of children in foster care but continued strong performance with regard to appropriately placing children for adoption or in legal guardianships, comparing rates (instead of absolute numbers) can ensure access to incentive payments. For states with increasing caseloads, it can ensure that increases in the number of adoptions or guardianships completed by the state are related to improved permanency efforts by the state, not simply the availability of more children for placement. Under current law, a state's total adoption incentive payment is generally equal to the number of increased adoptions multiplied by the incentive payment amount tied to each category—$4,000 for foster child adoptions, $4,000 for special needs (under age 9) adoptions, and $8,000 for older child adoptions. By contrast, H.R. 4980 provides that a state's incentive payment would equal the number of adoptions and/or guardianships calculated to have been completed because the state improved its rate (or percentage) of those adoptions and/or guardianships, multiplied by the award amount in that category. For each such foster child adoption, the award amount would be $5,000; for each such foster child guardianship, $4,000; for each such pre-adolescent (9 through 13 years) adoption or guardianship, $7,500; and for each older child (14 or older) adoption or guardianship, $10,000. H.R. 4980 would stipulate that for a foster child guardianship to be counted in the incentive program, the child must leave foster care for placement with a legal guardian. Further, the state must report to the Department of Health and Human Services (HHS) that it has determined for that child that being returned home or placed for adoption are not appropriate permanency options, that the child shows a strong attachment to the prospective legal guardian, that the prospective legal guardian has a strong commitment to providing permanent care for the child, and, if the child is age 14 or older, that he or she has been consulted regarding the legal guardianship arrangement. As an alternative, the state may inform HHS that it used "alternative procedures" to determine that legal guardianship was the appropriate option for a child who exited foster care to live with a legal guardian. Under current law, in any year when appropriations are sufficient, states that improve their highest-ever foster child adoption rate (beginning with the rate achieved in FY2002) are eligible for additional incentive payments. H.R. 4980 would amend this policy to instead provide a "timely adoption award" in any fiscal year when appropriations remain after all incentive payments for improved rates of adoptions and/or guardianships have been made. A state would be eligible to receive this award in any fiscal year that HHS determined that on average, children who left foster care for adoption during that year had been in foster care for less than 24 months (from removal to finalized adoption). As discussed above, H.R. 4980 would significantly alter the incentive structure, including by changing the categories for which awards are provided, changing award amounts, and calculating all awards based on improvements in a state's rate of adoptions or guardianships. However, the bill would provide a transition period before this new incentive structure would be fully implemented. Specifically, the renaming of the program and the changes in the incentive structure would not begin to take effect until FY2015 (October 1, 2014). This means incentive payments expected to be made this fiscal year (i.e., in August or September 2014 for adoptions finalized in FY2013) would be paid under the incentive structure in current law (including award categories, baseline numbers, and award amounts). H.R. 4980 also stipulates that incentive payments made in the second year of the reauthorization (FY2015) would equal one-half of the amount a state earns under the current law structure, plus one-half of what it would earn under the incentive structure included in H.R. 4980 . In the third year of the reauthorization (FY2016), the award structure included in H.R. 4980 would be used exclusively to determine the state's incentive payments. Apart from extension of the program and changes in the incentive structure, H.R. 4980 would amend the law to permit states up to 36 months from the month they receive any incentive funding to use those funds. (Current law allows states up to 24 months from the date payments are made to use the funds.) Under current law, states must spend any incentive payments they receive on the kinds of child and family services that may be supported under the federal child welfare programs included in Title IV-B and Title IV-E of the Social Security Act. Further, current law specifies that any incentive spending must not be counted as the non-federal share of funding required under Title IV-B or Title IV-E programs. H.R. 4980 would keep each of those provisions in place and would additionally stipulate that states must use the incentive funds to supplement, not supplant, any current spending of federal or non-federal dollars for these child welfare activities. Title II of H.R. 4980 would also amend provisions of the adoption assistance component of the Title IV-E program under the Social Security Act. Under current law, states are required to document savings in state spending (if any) that result from expanding federal eligibility for Title IV-E adoption assistance. That eligibility expansion was allowed by the Fostering Connections to Success and Increasing Adoptions Act of 2008 ( P.L. 110-351 ) and is primarily the result of removing income eligibility criteria for Title IV-E adoption assistance. The eligibility expansion began to be phased in with FY2010 and will be fully implemented as of FY2018. Soon after enactment of this expanded eligibility provision, the Congressional Budget Office (CBO) projected that it would increase federal Title IV-E spending by $1.4 billion from FY2009-FY2018, with the bulk of that increase ($1.3 billion) projected to occur in FY2014-FY2018. Some or all of this increase in federal outlays is likely to represent savings of state monies. Under H.R. 4980 , the requirements related to reinvestment of these funds would be restated and expanded. States would be required, beginning with FY2015, to calculate any savings in state spending based on the federal adoption assistance provided to children made eligible by the less restrictive federal criteria. States would be required to do this calculation using a methodology specified by HHS, or proposed by the state and approved by HHS. Further, each state would need to annually submit to HHS the methodology it used to calculate savings (whether or not any were identified); the amount of any savings identified; and how the savings are to be spent. HHS would be required to post this state-reported information on its website. Finally, Title II of H.R. 4980 would require states to spend no less than 30% of any identified savings to provide post-adoption services, post-guardianship services, and services to support and sustain positive permanent outcomes for children who might otherwise need to enter foster care. Further, of that 30%, no less than two-thirds must be spent for post-adoption and post-guardianship services. H.R. 4980 would also amend the law to stipulate that the spending of any such savings would need to supplement, rather than supplant, any federal or non-federal money already being used to support child welfare services available under programs included in Title IV-B or Title IV-E. Title II of H.R. 4980 would amend the guardianship assistance provisions of the Title IV-E program to provide that if the relative legal guardian of a child who is receiving Title IV-E kinship guardianship assistance dies or is incapacitated, the child continues to be eligible for this assistance so long as he or she is placed with a successor legal guardian. The successor legal guardian must have been named in the Title IV-E kinship guardianship agreement that was earlier entered into between the state child welfare agency and the child's previous relative legal guardian. Under current law, a child receiving Title IV-E kinship guardianship assistance whose legal relative guardian dies or becomes incapacitated cannot be certain that this assistance will continue with a successor guardian. Instead, the child must have eligibility for this Title IV-E assistance redetermined. Among other things, this redetermination requires the child to return to foster care for at least six months (and while living with the prospective successor guardian). The Congressional Budget Office (CBO) estimates this change in Title IV-E eligibility criteria (which would prevent the need for children to re-enter more costly foster care) would reduce federal outlays by $7 million across 11 years (FY2014-FY2024). Title II of H.R. 4980 would appropriate $15 million to continue Family Connection Grants for one year (FY2014). (According to CBO, the cost of this one-year appropriation would be fully offset by other changes included in H.R. 4980 .) Family Connection grants are competitively awarded to public or private organizations to carry out kinship navigator programs, intensive family finding efforts, family group decisionmaking policies, and residential family treatment programs. The grants were established and funded (FY2009-FY2013) by the Fostering Connections to Success and Increasing Adoptions Act of 2008. Beyond extending program funding for one year, H.R. 4980 would expand the list of entities eligible to apply for Family Connection grant funding to include institutions of higher education. It would seek to encourage greater support for foster parents who are willing to care for youth in care who are themselves parents (through kinship navigator programs) and it would remove from the law a provision ensuring the reservation of no less than $5 million in Family Connection Grant funding, annually, to support kinship navigator programs. (Accordingly, under H.R. 4980 funding for kinship navigator programs would be available under Family Connection Grants on the same basis as for any other authorized service.) Under the federal foster care program (Title IV-E of the Social Security Act), states are required to "exercise due diligence" to identify grandparents and other adult relatives of children being removed from parental custody and to provide those relatives notice of the child's removal from his/her parent(s), as well as of the options the grandparent or other adult relative has for participating in the child's care or placement. Title II of H.R. 4980 would amend this provision to specify that states must identify and provide this notice to a parent of a sibling of a child, provided that parent has legal custody of the sibling. Further, for purposes of the federal foster care program, it would define "sibling" to mean an individual recognized as a sibling under the state's law, or an individual who would be defined as a sibling except for the legal termination or other disruption of parental rights (such as the death of a parent). As part of the Title IV-E program, states are required to regularly report and collect data on children in foster care and those leaving foster care for adoption. Title II of H.R. 4980 would require HHS to issue new regulations providing for collection of data specifically concerning children who enter foster care after having been previously adopted or placed in a legal guardianship. (This may include children who were, or were not, previously in foster care.) The legislation notes that the data to be collected under the regulation are to promote increased knowledge on how best to ensure strong, permanent families for children in foster care, must include the number of children who enter foster care after a prior finalized adoption or legal guardianship, and may include information on the length of the prior adoption or guardianship, the age of the child at the time of the prior adoption or guardianship, the age of the child when he or she subsequently entered foster care, the type of agency involvement in making the prior adoptive or guardianship placement, and any other information determined necessary to better understand the factors associated with the child's post-adoption or post-guardianship entry to foster care. On February 27, 2013, the Subcommittee on Human Resources of the House Ways and Means Committee held a hearing on "Increasing Adoptions from Foster Care." Subcommittee Chairman Dave Reichert, noting the increase in adoptions and decline in the foster care caseload since the enactment of the Adoption Incentive program and other changes to the law in 1997, said that the hearing was to consider if other changes were needed to encourage adoption from foster care. Four witnesses discussed the importance of adoption as a way for children to find permanent homes, and they gave particular attention to the need for adoptions of older children and those with special needs. Each of the witnesses supported reauthorization of the Adoption Incentive program. Several witnesses described successful efforts to recruit adoptive families for older or harder to place children as those that start with a focus on the individual children or youth in need of families and engage them in the search for those families. One recruitment model, known as "Wendy's Wonderful Kids," includes small caseloads that allow adoption caseworkers to get to know and work with the children for whom they are seeking permanent homes. A rigorous study of the model's effectiveness found that children served under this recruitment and placement model were one and a half times more likely to leave foster care for permanent homes than those who received traditional adoptive home recruitment services. The model's impact is greatest among older children and those with mental health disorders. The state of Ohio has recently contracted to use the Wendy's Wonderful Kids model (on a nearly statewide basis) to find homes for harder to place children age 9 or older. By moving children from foster care to permanent homes more quickly, Ohio anticipates significant fiscal savings. Raising awareness of the need for adoptive families is a central goal of the Wait No More campaign, discussed by another hearing witness. This campaign brings together public child welfare agencies, private and public adoption agencies, church leaders and other support partners to promote and host adoption events at churches around the country. Interested families may begin the adoption process at the event, where speakers stress that adoption is about meeting the needs of the child (not the needs of adults), discuss common behavioral challenges for adoptees from foster care, and offer strategies to enable successful child and family outcomes. Witnesses also focused on the need for post-adoption services, including counselors with specific training and knowledge about the needs of adoptive families, to ensure safety and stability of these families. One witness asked that the longer-standing federal focus and financial support for increasing adoptions be coupled with a greater focus on (and financial support for) post-adoption services and suggested that Congress require states to spend their Adoption Incentive funds on post-adoption support. Another asked that Congress ensure that children who were adopted did not lose access to education, mental health-related, or other services that would be available to them if they remained in foster care. Several witnesses mentioned assignment of the case plan goal "another planned permanent living arrangement" (APPLA) as a potential barrier to finding permanent families for youth in care. Once a youth's goal is fixed as "APPLA," one witness noted the child welfare agency stops searching for a permanent family and focuses exclusively on preparing the youth for "independent living." He asserted that federal policy should always require efforts to find a permanent home for youth in care and noted that those efforts could continue even as the agency worked to help the youth develop independent living skills. Other issues raised at the hearing included a call for reauthorization of the separate competitive grant program known as Family Connections, which one witness noted supports projects that can help connect youth with permanent families through greater kinship support, intensive family-finding efforts and family group decision-making meetings, and greater use (by states) of Title IV-E training funds to support more competent adoption casework. As part of the hearing question and answer, witnesses also supported expanding the Adoption Incentive program to reward states that help youth gain a safe, permanent family through means other than adoption. In particular, several mentioned the importance of legal guardianship to achieving a permanent family for some older youth. On August 7, 2013, the House Ways and Means Committee posted on its website a "discussion draft" bill to re-authorize the Adoption Incentive Payments program. The accompanying announcement sought comments on that draft bill as well as comments on the Guardians for Children Act ( H.R. 2979 ). After receiving comments and revising the proposal, the Promoting Adoption and Legal Guardianship for Children in Foster Care Act ( H.R. 3205 ) was introduced on September 27, 2013, by Representative Camp, along with Representatives Levin, Reichert, and Doggett. The full House considered and passed this bill, under suspension of the rules, on October 22, 2013. A requested roll call vote tallied 402 for the bill and 0 opposed. As noted earlier, and shown in Appendix A , Title II of H.R. 4980 draws significantly from this bill. On April 23, 2013, the Senate Finance Committee held a hearing to consider reauthorization of the Adoption Incentive program; to extend funding for Family Connection Grants; and, more broadly, to consider the kinds of changes necessary to make further improvements in the provision of foster care. The hearing revolved around the story of Antwone Fisher, who spent his entire childhood in foster care before "aging out" (just before his 18 th birthday) to live in a homeless shelter. At the hearing, Mr. Fisher recounted his story, and, among other things, highlighted the need for child welfare agencies to actively work to find a permanent family for each child in foster care, ensure the safety and well-being of children while they are in care, and provide them with meaningful opportunities to prepare for adulthood. Other witnesses at the hearing stressed many of these same points. One witness focused on the need to engage youth in taking charge of their lives, including through transition planning and a form of individual development accounts known as "Opportunity Passports." A former child welfare agency director talked about the efforts of his agency to move from a "punitive" system with a single "fault-finding" response to one that was collaborative and family-centered (providing responses commensurate with a family's needs and concerns). Additionally, one witness asserted the need for child welfare agencies to place a greater value on finding and involving family members in meeting the needs of the children they serve. He suggested the need for states to develop a more systemic approach to identifying family members and advocated more enforcement of, and new reporting on, the existing federal requirements for child welfare agencies to identify and give notice to adult relatives of children entering foster care. On September 30, 2013, the Senate Finance Committee posted a discussion draft bill to reauthorize Adoption Incentive Payments and make certain other changes to federal child welfare policies. After receiving comments on this draft, a version of that discussion draft bill became Title I of the Chairmen's Mark version of the Supporting At-Risk Children Act, which was considered at a December 12, 2013, Finance Committee mark up. The Chairman's Mark was modified to include two child welfare-related amendments (concerning promoting sibling connections and establishing a timely adoption award) before being approved on a voice vote. The bill was reported to the Senate (as S. 1870 ) on December 19, 2013. (A written report, S.Rept. 113-137 , to accompany this legislation, was filed later.) Also on December 19, 2013, the provisions of Title I of S. 1870 (as approved by the Senate Finance Committee) were introduced in a stand-alone bill, known as the Strengthening and Finding Families for Children's Act ( S. 1876 ). That bill was introduced by Senator Baucus, with Senators Hatch, Wyden, Rockefeller, Grassley, and Casey. As discussed earlier and shown in Appendix A , Title II of H.R. 4980 draws significantly from Title I of S. 1870 / S. 1876 . The remainder of this report reviews past congressional interest in use of adoption to move children from foster care to permanency, including the creation of the Adoption Incentive Payments program in 1997 legislation (ASFA, P.L. 105-89 ), before discussing this program as it has operated since its 2008 reauthorization (Fostering Connections, P.L. 110-351 ). Foster care is a temporary living arrangement for children for whom remaining in their own homes is not safe or appropriate. Most children who enter foster care are ultimately reunited with their parents. However, when reunification is determined not possible or appropriate, adoption is generally considered the best way to achieve a new permanent family for a child. Congress has long shown an interest in encouraging adoptions of children who would otherwise remain in foster care until they age out. In 1978, the Adoption Opportunities program (Title II of the Child Abuse Prevention and Treatment and Adoption Reform Act, P.L. 95-266 ) was enacted to require federal administrative coordination of adoption and foster care programs and to support research and other activities to "facilitate elimination of barriers to adoption and to provide permanent and loving home environments for children who would benefit from adoption, particularly children with special needs." In 1980, Congress enacted the Adoption Assistance and Child Welfare Act ( P.L. 96-272 ), including the first federal support for ongoing subsidies to eligible adoptees with "special needs" (under a new Title IV-E of the Social Security Act). In this context the "special needs" designation applies to children in need of new permanent families (i.e., they cannot be returned to their parents) and who have conditions or factors that make it harder to find them adoptive homes without offering assistance. States may establish their own factors to determine special needs, but commonly used factors include a child's age; membership in a sibling group; medical condition; mental, physical or emotional disability; or membership in a minority race/ethnicity. By 1997, a renewed concern about the failure to move children from foster care to permanent families was an important impetus for the Adoption and Safe Families Act (ASFA, P.L. 105-89 ). As part of that law, Congress made changes to federal child welfare policy that were intended to ensure that states focused on achieving expeditious permanence for children in foster care, including through adoptions whenever appropriate. Among other changes, the law tightened or added new permanency planning timelines for children in foster care, required states to spend certain federal child welfare funds (under the Promoting Safe and Stable Families Program) for adoption promotion and support services, and authorized financial incentives to states that increase adoptions of children out of foster care under the newly created Adoption Incentive program. In 2008, as part of the Fostering Connections to Success and Increasing Adoptions Act ( P.L. 110-351 )—and in addition to extending the Adoption Incentive program—Congress expanded eligibility for federal (Title IV-E) adoption assistance principally by removing income criteria tied to the family from which a child had been removed (usually this is the child's biological family). The revised eligibility criteria are being phased in and now apply to only some children determined to have special needs. However, as of FY2018 any child determined by a state to have special needs may be eligible for ongoing, federally supported adoption assistance. Adoption is a social and legal process by which a child gains a new and permanent family. For each child in foster care who cannot be reunited with his or her parents and for whom adoption is determined to be the child's route to permanency, the state must identify suitable and willing adoptive parent(s). States may begin the process of recruiting an adoptive family before a child is "legally free" for adoption. However, before the child's adoption may be finalized a state (or tribal) court must generally terminate any existing parental rights or responsibilities to a child. Once this process, referred to as "TPR" (for termination of parental rights), has been completed, the child's adoption by new parents may be finalized by a state or tribal court. Since the 1997 enactment of ASFA, the annual number of adoptions out of foster care rose significantly and the rate of adoptions has doubled. There are fewer children in foster care who are "waiting for adoption," and the average time it takes to complete an adoption has declined by roughly one year. At the same time, the number of children waiting for adoption remains more than double the number of those adopted each year and adoptions of older children remain less common than those of younger children. The annual number of adoptions from foster care climbed from less than 30,000 in the mid-1990s, to a peak of some 57,000 in FY2009. Since then (through FY2012) the number has remained at, or above, roughly 50,000. The rise in the number of adoptions played a significant role in the decline in the overall number of children in foster care, which peaked in FY1999 at 567,000 children and had declined by 30%, to 397,000 children, as of the last day of FY2012. The fact that the number of foster child adoptions has remained relatively high, despite the decline in the overall number of children in foster care, is notable. Viewed as a rate—that is the number of children adopted during a given fiscal year for every 100 children who were in foster care on the last day of the preceding fiscal year—public child welfare agency adoptions more than doubled since the late 1990s (from a rate of roughly 6 adoptions per 100 children in foster care to 13 per 100). (See Table C-1 in Appendix C for annual data on number and rate of adoptions.) For roughly one-quarter (24%) of the children in foster care on a given day, adoption has been identified as their case plan goal—that is, their exit strategy to permanency. Some children with a permanency goal of adoption, and certain other children in foster care, are "legally free" for adoption—meaning the rights of both parents have been terminated. These children—those with a case plan goal of adoption and/or for whom all parental rights have been terminated are generally referred to as children who are "waiting for adoption." For most of FY1998-FY2012, the number of children waiting for adoption was between 130,000 and 135,000. However, in recent years this number has declined, and it stood at 102,000 as of the last day of FY2012. Additionally, the share of waiting children who leave foster care for adoption has increased. Specifically, the number of children adopted from foster care in FY1999 was 37% of all children waiting for adoption on the last day of FY1998; the comparable percentage for children adopted in FY2012 was 49%. (See Table C-2 in Appendix C for annual data on the number of waiting children and the share adopted in the following year.) Even though the number of waiting children has declined, that number represents a slightly larger share of the overall foster care caseload in FY2012 (26%) than was the case in FY1998 (22%). This relatively modest increase in share of children in foster care waiting for adoption—coinciding with greater success in moving waiting children to adoption—might reflect changes in state practice regarding who may be assigned a case goal of adoption. Alternatively, or in addition, it might be the result of state efforts to reduce unnecessary entries to foster care—which in turn could mean a higher percentage of those entering will need to find a new permanent family via adoption. Adoption is a multi-step legal and social process that takes time to accomplish. Children who enter foster care do not typically move directly to adoption. With limited exceptions federal policy requires that a state must make "reasonable efforts" to reunite a child with his or her family. When reunification is determined not possible, however, the state must take certain steps to free a child for adoption. Specifically, as amended by ASFA, federal law requires a state to petition a state court for termination of parental rights (TPR) to the child if a state court finds either that the child is an abandoned infant (as defined in state law) or that reasonable efforts to reunite the child and his/her parents are not required (because the parent has committed one of certain heinous crimes against the child or his/her sibling). Additionally, once a child has been in foster care for 15 out of the last 22 months, the state must petition the court for TPR, unless it can document for the court that doing so would not be in the child's best interest, that services necessary for reunification and agreed to in the child's case plan have not been provided, or that the child is living with a relative. The state court must then determine—based on state laws defining when parental rights may be severed—whether to grant TPR. At the same time, for any child who cannot be reunited and whose case plan goal is adoption, the state agency must work to find an appropriate and willing adoptive family. Once this step is complete, and a child is successfully placed with the family, a state court must again act, this time to finalize the adoption and, as part of this process, to formally provide the adoptive parents with all legal parental rights and responsibilities for the child. Since FY2000, the amount of time a child spends in foster care before leaving via a finalized adoption has declined by roughly one year. Most of this reduction in time is a result of the shorter time frame needed to reach TPR. However, there has also been some decline in the amount of time it takes to finalize a child's adoption after TPR is completed. On average, adoptions of children out of foster care that were finalized in FY2000 took just under four years to complete (45.9 months). By contrast, children who reached a finalized adoption in FY2012 did so, on average, in less than three years (33.1 months). (For annual data on average and median time from removal to finalized adoption, see Table C-3 in Appendix C . ) Promoting the use of adoptions to ensure children who would otherwise remain in foster care have a permanent family has been a driving purpose of the Adoption Incentive program since its creation. The program has also sought to provide special incentives to states for adoptions of children who are considered harder to place in adoptive homes, including children with special needs and older children. Established by ASFA in 1997 (at Section 473A of the Social Security Act), the Adoption Incentive program has been amended and extended twice: first, by the Adoption Promotion Act of 2003 ( P.L. 108-145 ), and, more recently, by the Fostering Connections to Success and Increasing Adoptions Act of 2008 ( P.L. 110-351 ). Each reauthorization of the Adoption Incentive program has made some changes to the incentive structure used to determine awards, including the categories for which awards may be earned, the "baselines" used to determine improvement, and/or the amount of the individual incentive awards. The current incentive structure is described below. ( Appendix D includes a table that shows development of the incentive structure across program reauthorizations.) Under current law, states earn Adoption Incentive funds in four ways. Specifically, states may earn incentive payments for an increase in the number of children adopted out of foster care overall; number of children adopted at age 9 or older; number of children adopted with special needs and who are under the age of 9; or rate at which children were adopted from foster care. Whether a specific state has increased the number of adoptions is determined by comparing the number of adoptions that the state finalized during the fiscal year to the number of such adoptions it finalized in FY2007 (the "baseline" year). A state is determined to have increased its rate of adoption if the percentage of children adopted from foster care (as a share of the number of all children in foster care in the prior year) is greater than it was in FY2002, or in any succeeding fiscal year prior to the year for which the award is being determined. An eligible state earns $4,000 for each foster child adopted above its baseline number of foster child adoptions and $8,000 for each older child (age 9 or above) adoption above its older child adoption baseline. If a state earns an award in either of those categories—or if it improved its adoption rate—it also earned $4,000 for each adoption of a special needs child (under age 9) that was above its baseline number of such adoptions. Finally, for an improvement in its rate of adoption, a state is eligible for additional incentive funds of $1,000 multiplied by the increased number of adoptions achieved by the state that are attributed to its improved adoption rate. However, increases due to improved adoption rates may only be paid if sufficient program funding is available after all awards for increases in the number of adoptions have been made. Any state (includes the 50 states, District of Columbia, and Puerto Rico) operating a Title IV-E program may be eligible to earn Adoption Incentive payments provided awards are authorized for that year. The program law (Section 473A of the Social Security Act) provides states may only earn awards for adoptions finalized in any of FY2008-FY2012 and it authorizes funds for that purpose through FY2013. However, the Consolidated Appropriations Act, 2014 ( P.L. 113-76 ) provides that states may continue to be eligible to earn Adoption Incentive Payments for adoptions completed in FY2013 and it provides FY2014 funds ($37.9 million) to make those incentive payments. Further, to be eligible for Adoption Incentive payments, the state must provide—via the Adoption and Foster Care Analysis Reporting System (AFCARS)—the necessary data to calculate the incentive amounts. The state must also assure that it provides health insurance coverage to any adoptive child for whom the state determined the child has special needs—including those eligible for ongoing Title IV-E adoption assistance and those with special needs who are not eligible for this assistance. In addition, no state may receive an award for an increase in the number of special needs adoptions of children under the age of 9, unless that state, in that same year, also shows an increase in of the number of foster child or older child adoptions (compared to what the state achieved in FY2007), or an increase in the state's rate of foster child adoption (compared to the rate it achieved in FY2002, or any higher rate achieved in a prior subsequent year). The first Adoption Incentive awards were paid in FY1999 for adoptions finalized in FY1998 and the most recent were initially paid in FY2013 for adoptions finalized in FY2012. During the life of the program, all 50 states, the District of Columbia and Puerto Rico have earned Adoption Incentive payments in one or more years and more than $423 million has been awarded to all states through FY2012. Discretionary funding was authorized for the program through FY2013 at the annual level of $43 million. Actual appropriation levels have varied but in recent years have been less than $40 million. For FY2013, Congress provided $37.2 million (after sequestration) and for FY2014 it provided $37.9 million. Table 1 summarizes the appropriations provided and awards made by fiscal year for which the funds were initially appropriated and the fiscal year for which the incentive funds were earned. For numerous years, not all of the funding shown as the award amount for a given year was actually paid to states at a single time or in a single fiscal year. In years when funds are not sufficient to pay all incentive payment amounts earned (based on numbers of adoptions), HHS prorates the award amounts for the initial payment (as provided for by statute) and subsequently it awards remaining earned incentives (for improved numbers of adoptions) when additional appropriations are provided. For example, when HHS made the initial award for adoptions completed in FY2012, it had just $32.5 million available, or about 74% of the full amount states earned during the year for increasing the numbers of children adopted. Accordingly, each state that earned such an award received 74% of that total amount in September 2013. Subsequently, Congress provided additional program appropriations (as part of P.L. 113-76 ) and HHS awarded the remaining amount (26%, or about $11.4 million) to states. Under the incentive structure used to make awards for adoptions finalized in FY2008-FY2012, states were eligible to receive $212 million and received a total of $202 million in Adoption Incentive payments. Forty-five states were paid Adoption Incentive payments in one or more award category for adoptions finalized in any of FY2008-FY2012. Among the seven states that were not paid an incentive for adoptions finalized in those years, five (Massachusetts, New Jersey, Ohio, and Vermont) actually increased their rate of adoption in one or more of those award years and therefore were eligible for an adoption incentive payment, but did not receive an award due to the program funding level. Additionally, one state (New York) increased the number of special needs (under age 9) adoptions in some of those years. However, because it did not earn an incentive in any of the other categories (foster child, older child, or adoption rate), it was not eligible for incentive funds for those increases. The remaining two states (District of Columbia and Iowa) did not increase the number of adoptions achieved or improve their rates of adoption in any of the five years. Table 2 shows the total amounts paid to states under the current incentive structure by award year and incentive category. States did not necessarily receive all of these incentive payments in a single fiscal year. Further, there were insufficient program funds available to make incentive payments for improved adoption rates in most years. Therefore, the total amount of incentive payments that states were eligible to receive for adoptions finalized in FY2008-FY2012 is about $10 million more than the total amount they were expected to receive. States earned incentive payments of $94.7 million (45% of the total incentive funds they were eligible to receive) for increasing their number of foster child adoptions finalized in FY2008-FY2012. That award category is the broadest—applying to children adopted from foster care generally. States may earn $4,000 for every adoption of a foster child in the given award year that is above the number of foster child adoptions the state completed in FY2007 (the baseline year). Fifteen states finalized more foster child adoptions in each of FY2008-FY2012 than they did in FY2007, and they earned foster child adoption incentive payments in each of these five years. A little more than half of the states (27) earned incentive payments for increases in foster child adoptions in at least one or more (but not all five) of those years, and 10 states did not improve on their FY2007 record in any of these five years. Twenty-seven percent ($56.7 million) of the total incentive dollars states were eligible to receive for adoptions finalized in FY2008-FY2012 were tied to increases in the number of children who were adopted at 9 years of age or older. Adoptions of older children are less common than are adoptions of those who are younger. However, states may earn the largest award amount for increases in this incentive category. Specifically, states may earn $8,000 for every adoption of an "older child" in the given award year that is above the number of older child adoptions the state completed in FY2007 (the baseline year). Twelve states earned incentive payments for increasing their numbers of older child adoptions in each of FY2008-FY2012 and, a little more than half of the states (27) did so in at least one (but not all five) of those years. Thirteen states did not increase their number of older child adoptions (above their FY2007 level in the state) in any of those five years. Twenty-three percent ($49.5 million) of the incentive payments states were eligible to receive for adoptions finalized in FY2008-FY2012 were linked to increases in the number of adoptions of children who were determined to have special needs and who were under the age of nine. States are only eligible to earn incentive payments in this category if they have earned an award in at least one other incentive category during the same fiscal year (i.e., they increased older child or foster child adoptions or they improved their rate of adoption). For eligible states, the award amount is $4,000 for every adoption of a special needs child under 9 years of age that is above the state's baseline number of such adoptions (i.e., above the number of such adoptions it achieved in FY2007). For adoptions finalized in FY2008-FY2012, 10 states increased their number of special needs (under age 9) adoptions above their baseline, but were not eligible in one or more years when this occurred because they did not earn an incentive payment in any other Adoption Incentive category in that same year. Overall, 10 states increased the number of special needs (under age 9) adoptions finalized in each of those five years (compared to FY2007); more than half of the states (30) did so in at least one (but not all) of the five years (FY2008-FY2012); and 12 states did not increase the number of these adoptions (above their FY2007 level) in any of those five years. Finally, the total incentive amount a state is eligible to receive in a year is increased if the state improves its rate of adoption. However, this increased incentive payment is only authorized to be paid to states if sufficient appropriations remain available after awards are made for increases in the number of adoptions. For adoptions finalized in FY2008-FY2012, states were collectively eligible for $11.5 million in incentive payments for improved adoption rates (5% of incentive payments states were eligible for across all four award categories). However, there were sufficient appropriations to award just $1.7 million (15%) of the total amount. A state's adoption rate is equal to the total number of foster child adoptions it completed in the fiscal year for every 100 children that were in its foster care caseload on the last day of the preceding fiscal year. An award for an increased rate of adoption can ensure that an incentive may be earned by a state that continues to appropriately move children from foster care to adoption even as the total number of children in foster care declines. In those states, the total number of children for whom adoption is the desired or appropriate permanency outcome is also likely to decline. To be counted as having an improved adoption rate, a state was required to exceed the highest rate of adoptions it had achieved in any year (beginning with FY2002) that came before the year for which the awards were being calculated. A state that improved its adoption rate was eligible for $1,000 award for each adoption calculated to have been achieved due to the higher rate of adoptions. The large majority of states (44) improved on their initial adoption rate baseline in one or more years from FY2008-FY2012. In FY2008, on average, states finalized roughly 11 adoptions for every 100 children who were in foster care; the comparable number for FY2012 was 13 adoptions for every 100 children in foster care. States may spend Adoption Incentive funds anytime within a 24-month period, beginning with the month in which the funds are awarded to a state. The statute permits states to spend these incentive dollars on any service authorized to be provided to children and families under Title IV-B or Title IV-E of the Social Security Act. Those parts of the law authorize a broad range of child welfare-related activities, including activities to prevent child abuse or neglect and/or provide services to enable a child to remain in his/her own home; investigation of alleged child abuse or neglect and placement of children in foster care if necessary; provision of services to reunite a child in foster care with his/her parents and for services to maintain the reunification; finding a new permanent home for children who may not be reunited with their parents, including through adoption or guardianship; provision of post-permanency services; and services to assist a youth in foster care to make a successful transition to adulthood. A state may not count its spending of Adoption Incentive funds toward meeting any of the "matching" requirements included in the programs authorized in Title IV-E and Title IV-B of the Social Security Act. (Programs under those parts of the law generally require states to supply between 20% and 50% of the total program funding out of their non-federal, state or local, dollars.) Many states report spending incentive funds on adoption-related purposes, including post-adoption support services (e.g., support for adoptive parent mentors or adoptive family support groups, respite care, casework and supports for adoptive families of children at risk of re-entering foster care); recruitment of adoptive homes (e.g., support for online adoption exchange or photo-listing, development of promotional materials, child-specific recruitment efforts); and training or conferences to improve adoption casework. Other adoption-related services or supports funded with Adoption Incentive awards (in a smaller number of states) included provision of monthly adoption assistance payments, purchase of new equipment or provision of other resources to improve processing and archiving of adoption records, support for new or improved adoption home studies, and attention to inter-jurisdictional adoption placement. Some states used Adoption Incentive funds for foster care-related activities (e.g., training or recruitment of foster parents—alone or in combination with adoptive parents and foster and/or adoptive parent supports). Others referenced support for permanency efforts more generally (i.e., incorporating guardianship or reunification). At least one state reported using these incentive funds for foster care maintenance payments. Finally, a few states described use of Adoption Incentive funds for services to families and children remaining in the home (e.g., alternative response and direct child protection services). Appendix A. Comparison of Current Law and Selected Reauthorization Proposals Appendix B. Glossary of Terms ADOPTION RATE —The number of children in foster care who are adopted during a fiscal year for every 100 children who were in foster care on the last day of the previous fiscal year. ADOPTION RATE BASELINE —Highest ever adoption rate achieved by the state for any fiscal year that is before the fiscal year for which the Adoption Incentive rate award is being determined, beginning with FY2002. ANOTHER PLANNED PERMANENT LIVING ARRANGEMENT (APPLA) —Each child in foster care must have a permanency goal—that is a plan for leaving foster care to a permanent home. A hearing to determine (or re-determine) that permanency goal must be held no later than 12 months after a child enters foster care, and every 12 months thereafter while the child remains in foster care. If at this hearing it is determined that the child's plan for permanency may not be any of reuniting with his/her parents, placement for adoption, placement with a legal guardian, or going to live with a fit and willing relative, then a child's plan for exiting care may be "another planned permanent living arrangement." BASELINE (as used in the Adoption Incentive program)—The standard against which state performance is measured to determine whether, in a given year, the state has increased its number of adoptions or improved its adoption rate. A baseline is specific to the state, and is based on a state's past performance. (The four specific baselines used in the current Adoption Incentive program are defined individually in this glossary.) FOSTER CHILD ADOPTION —The finalized adoption of a child who, at the time of adoptive placement, was in public foster care under the placement and care responsibility of the state child welfare agency. FOSTER CHILD ADOPTION BASELINE —The number of foster child adoptions in the state in FY2007 as reported by the state via the Adoption and Foster Care Analysis Reporting System (AFCARS). GUARDIANSHIP —A judicially created legal relationship between child and caretaker which is intended to be permanent and self-sustaining as evidenced by the transfer to the caretaker of the following parental rights with respect to the child: protection, education, care and control of the person, custody of the person, and decision-making. OLDER CHILD ADOPTION —The finalized adoption of a child who is nine years of age or older and who, at the time of the adoptive placement was in public foster care or was the subject of a Title IV-E adoption assistance agreement between the state child welfare agency and the child's adoptive parents. OLDER CHILD ADOPTION BASELINE —The number of older child adoptions in the state in FY2007 as reported by the state via AFCARS. SPECIAL NEEDS ADOPTION —The adoption of a child whom the state has determined (1) cannot be returned to his or her parents and (2) is unlikely to be adopted without assistance because of a particular factor or condition (e.g., child's age; membership in a sibling group; minority race/ethnicity; medical or physical condition; or emotional, mental or behavioral disability). Additionally, unless this is not in the best interest of the child, the state must have made reasonable efforts to place the child for adoption without providing assistance. (A state is required to enter into a Title IV-E adoption assistance agreement with the adoptive parents of any child it finds to have special needs.) SPECIAL NEEDS (UNDER AGE 9 ) ADOPTION —The finalized adoption of a child who is eight years of age or younger and who at the time of the adoptive placement was the subject of a Title IV-E adoption assistance agreement between the state child welfare agency and the child's adoptive parents. SPECIAL NEEDS (UNDER AGE 9 ) ADOPTION BASELINE— The number of special needs (under age 9) adoptions in the state in FY2007 as reported by the state via AFCARS. TERMINATION OF PARENTAL RIGHTS (TPR) —The legal severing (in a state court /court of competent jurisdiction) of the parent-child relationship. (Typically this severs the rights and responsibilities of a biological parent to his/her child. In the case of a previously adopted child however, it is the severing of the rights and responsibilities of the adoptive parent.) WAITING FOR ADOPTION (as counted by HHS, Children's Bureau)—A child who is in foster care and who has a case plan goal of adoption and/or to whom all parental rights have been terminated. Except that any youth age 16 or older and to whom all parental rights have been terminated is excluded if that youth has a case plan goal of "emancipation." Appendix C. Trends in Adoptions with Public Child Welfare Agency Involvement Table C-1 shows, by fiscal year, the number of adoptions in which the public child welfare agency was involved, the number of children in foster care (under the responsibility of the public child welfare agency) on the last day of the fiscal year, and the rate of adoptions. All children who leave public foster care for adoption are adopted with public child welfare agency involvement and they represent the very large number of children shown in the adoption column. A small number of children who do not enter foster care may also be adopted with public child welfare agency involvement and that number is also included in the number shown in the adoptions column. Appendix D. Adoption Incentive Payments At each reauthorization of the Adoption Incentive program, Congress has adjusted the incentive structure. New award categories and adjustments to the baselines have placed greater emphasis on adoption of harder to place children, helped to ensure that earning an incentive was possible even as caseloads declined, and protected the value of the incentive payments from erosion by inflation. Appendix E. Children in Foster Care and Waiting for Adoption by State

Summary: Under the Adoption Incentive program (Section 473A of the Social Security Act), states earn federal incentive payments when they increase adoptions of children who are in need of new permanent families. All 50 states, the District of Columbia, and Puerto Rico have earned a part of the $424 million in Adoption Incentive funds that have been awarded since the program was established as part of the Adoption and Safe Families Act of 1997 (ASFA, P.L. 105-89). Discretionary funding authorized for this program has been extended twice since it was established, most recently in 2008 (P.L. 110-351). Although funding authority for the Adoption Incentive program expired on September 30, 2013, the Consolidated Appropriations Act, 2014 (P.L. 113-76) permits states to continue to receive the Adoption Incentive payments and appropriates $37.9 million for them. In addition, Title II of the Preventing Sex Trafficking and Strengthening Families Act (H.R. 4980), which was introduced on June 26, 2014, would extend current annual discretionary funding authority ($43 million) for Adoption Incentive payments through FY2016. Beyond this, Title II of H.R. 4980 would add incentive payments for states that make improvements in appropriately moving children from foster care to legal guardianship and would determine awards based on the percentage (or rate) of children leaving foster care to adoption and/or guardianship, instead of the absolute number of children leaving. In similar statements issued on June 26, 2014, by the House Committee on Ways and Means and the Senate Committee on Finance, Representatives Camp and Levin, along with Senators Wyden and Hatch, announced H.R. 4980 as "bipartisan legislation [that] reflects agreements reached between House and Senate negotiators" on legislation previously approved in the House and in the Senate Finance Committee. Specifically, Title II of H.R. 4980 draws on H.R. 3205, passed by the House in October 2013, and provisions included in Title I of S. 1870, approved by the Senate Finance Committee in December 2013. Congress has long shown interest in improving the chances of adoption for children who cannot return to their parents and who might otherwise spend their childhoods in temporary foster homes before "aging out" of foster care. Since ASFA's enactment in 1997, the annual number of children leaving foster care for adoption has risen from roughly 30,000 to more than 50,000 and the average length of time it took states to complete the adoption of a child from foster care declined by close to one year (from about four years to less than three). Over the same time period, and in significant measure due to the greater number of children leaving foster care for adoption and at a faster pace, the overall number of children who remain in foster care declined by 29%—from a peak of 567,000 in FY1999 to 400,000 in FY2012. Despite these successes, however, the number of children "waiting for adoption" (102,000 on the last day of FY2012) remains about double the number of children who are adopted during a given year. Adoptions of older children remain far less common than adoptions of younger children, and some 23,000 youth aged out of foster care in FY2012, compared to just 19,000 in FY1999. Under the current award structure, a state's adoption incentive payment equals the specified incentive amount for a given category of adoptions multiplied by the number of adoptions in the category that is above the number completed by the state in FY2007. The specified incentive amount is $4,000 for foster child adoptions, $8,000 for older child (9 years or more) adoptions, and—provided a state is eligible for an incentive in another award category—$4,000 for special needs (under age 9) adoptions. Additionally, if sufficient appropriations are available in the fiscal year, a state may also earn incentive payments for improving the rate (or percentage) of foster child adoptions. In the five years (FY2008-FY2012) that this incentive structure has been in place, states received combined incentive payments of nearly $202 million, including $95 million for increases in the number of foster child adoptions, $57 million for increases in older child adoptions, and $48 million for increases in special needs (under age 9) adoptions. They also received about $2 million for increases in the rate of foster child adoptions. (This amount was significantly less than the nearly $12 million states were eligible to receive based on improved adoption rates. However, that full amount was not paid because nearly all appropriations provided were needed to make incentive payments for increased numbers of adoptions.) States are permitted to use Adoption Incentive payments to support a broad range of child welfare services to children and families. Many states report spending incentive funds on adoption-related child welfare purposes, including post-adoption support services, recruitment of adoptive homes, and training or conferences to improve adoption casework. A smaller number of states report using these funds for adoption assistance payments, improved adoption homes studies, child protection casework, foster care maintenance payments, or other child welfare purposes. In addition to amending and extending Adoption Incentive payments, Title II of H.R. 4980 would extend funding for Family Connection Grants (Section 427 of the Social Security Act) for one year, add new reporting and spending requirements for states with regard to certain federal funds they receive under the adoption assistance component of the Title IV-E program, and make possible continued federal Title IV-E guardianship assistance eligibility for children already receiving that assistance who are subsequently placed with a "successor guardian." Additionally, the bill would make changes to federal foster care requirements intended to further facilitate placement of siblings together while in foster care.