State Rep. Kathy Schmaltz today testified before the House Families and Veterans Committee in support of her plan to ensure young people in Michigan’s foster care system can access the financial support they’re entitled to as they become adults.

Schmaltz, R-Jackson, introduced House Bill 4750 to help young people as they age out of the foster care system. Her plan addresses a problem highlighted by recent reports in the Detroit Free Press and Detroit News about the state’s practice of diverting federal benefits intended for foster children to fund its child welfare program. Schmaltz said the money should go to foster kids because it’s their money.

“When a child in foster care qualifies for federal benefits, that money should be used to support their future,” Schmaltz said. “These kids already face enough challenges. We need to make sure they can step into adulthood with the resources they deserve.”

Under current practice, any federal benefits awarded to a child in the Michigan foster care system are collected by the state and used to reimburse the state for the cost of care. This includes income such as Veterans Administration benefits, Supplemental Security Income, and Social Security benefits.

Schmaltz’s plan, House Bill 4750, will set aside a portion of these federal benefits for the child’s future needs. For children aged 14 and 15, at least 40% of these benefits must be set aside; children aged 16 and 17 would have at least 80% set aside; and foster youth aged 18 to 20 would have 100% set aside.

The measure also provides children in foster care with financial literacy training and ensures they are notified about all the federal benefits the state applies for and collects on their behalf.

According to Kids Count data, 33% of young people aging out of foster care in Michigan experience homelessness between the ages of 19 and 21. Schmaltz said her plan will help prevent this by giving youth the tools and resources they need to build stable futures.

“This is about fairness and giving foster kids a fighting chance,” Schmaltz said. “If we expect them to thrive as adults, we must give them the same opportunities we would want for our own children.”

House Bill 4750 remains under consideration by the committee.