HB 2169
In CommitteeHouse
DCYF/financial stability
Strengthening the financial stability of persons in the care of the department of children, youth, and families.
This status may be delayed. See Action History below for the latest updates.
How does a bill become law?
- Introduced: The bill is filed and assigned a number.
- Committee: A subject-matter committee holds hearings, takes public testimony, and decides whether to advance the bill.
- Floor Vote: The full chamber (House or Senate) debates and votes on the bill.
- Opposite Chamber: The bill repeats the committee and floor vote process in the other chamber.
- Governor: The Governor reviews the bill and decides whether to sign or veto it.
- Signed: The bill has been signed into law.
AI Analysis
This bill stops Washington’s Department of Children, Youth, and Families (DCYF) from using federal benefits received by youth aged 18–21 in its care to repay the state for care costs, and instead requires DCYF to help those youth access, receive, and manage those benefits themselves—such as Social Security benefits—by assisting with applications, payee designation, and financial account setup.
- Starting January 1, 2027, DCYF may no longer use any benefits (e.g., Social Security, SSI, retirement, or disability payments) received by youth aged 18–21 in its care to reimburse the state for care costs.
- DCYF must assess youth aged 18–21 in its care for eligibility for Social Security benefits (including SSI and SSDI) and assist them in becoming their own payee if eligible.
- DCYF must help eligible youth set up a financial account (e.g., Washington’s ABLE account, checking or savings account) to receive and manage their benefits.
- If a youth needs help managing benefits, DCYF must help identify a suitable authorized representative—and may serve as the representative if no one else is available.
- When a youth or non-DCYF third party serves as payee or authorized representative, DCYF is not legally responsible (i.e., does not owe a fiduciary duty) for managing the benefits.
- Changes to RCW 74.13.060 raise the threshold for mandatory savings accounts from $500 to $2,000 and require that funds for youth aged 18–21 be placed in savings or investment accounts starting January 1, 2027, per the new provisions.
Who is affected
- Youth aged 18–21 in foster care — Youth aged 18–21 in foster care under DCYF oversight will no longer have their Social Security or other federal benefits used to reimburse the state for their care costs, and will instead receive support to access and manage those benefits themselves.
- Department of Children, Youth, and Families (DCYF) staff — DCYF staff and contractors will need to assess youth for federal benefits, assist with benefit applications/payee designation, and help set up financial accounts—potentially requiring new training or external support.
- Families or trusted adults acting as authorized representatives — Families or trusted adults who may serve as authorized representatives for youth managing benefits will be involved in support planning, but will not be held to a fiduciary standard by DCYF.
Pro/Con Analysis
Stronger case for benefits
Potential Benefits (5)
Prevents the state from using federal benefits (e.g., SSI, SSDI) to offset care costs, ensuring that youth aged 18–21 in foster care retain full access to their earned or needs-based federal benefits—critical for building assets, avoiding poverty traps, and achieving economic mobility.
FinancialPeopleRef: Sec. 1(1); Sec. 1(2)(a)Mandates financial literacy and account setup support (e.g., ABLE accounts, checking/savings), which can improve long-term educational outcomes by enabling youth to save for college, avoid predatory lending, and build credit—key for foster youth who often lack intergenerational financial support.
EducationPeopleRef: Sec. 1(2)(b); Sec. 1(3)Empowers youth aged 18–21 to serve as their own payees or choose trusted representatives, reinforcing autonomy, self-determination, and agency over personal finances—critical for transitioning out of state custody into independence.
Rights & LibertiesPeopleRef: Sec. 1(2)(a); Sec. 1(3)Requires placement of funds above $2,000 in savings or investment accounts, supporting asset-building and long-term financial stability—though not immediate liquidity, this helps prevent depletion of resources and supports future housing security.
HousingPeopleRef: Sec. 2(1)(c) (savings threshold increase to $2,000)By ensuring youth receive and manage their own federal benefits (e.g., SSI, SSDI), the bill helps maintain access to Medicaid and other health coverage tied to those benefits—critical for continuity of care during transition to adulthood.
HealthcarePeopleRef: Sec. 1(3)
Potential Concerns (5)
Eliminates state revenue from using federal benefits as reimbursement for care costs, which may strain state budgets and reduce funds available for broader child welfare services, potentially leading to service cuts or increased taxes elsewhere.
FinancialPeopleRef: Sec. 1(1); Sec. 2(1)(b)(ii) (repealed by Sec. 1)Increases administrative burden on DCYF and potentially counties (via contracted providers), requiring new staff training, coordination with SSA and financial institutions, and system upgrades—costs likely passed to local governments through state contracts or unfunded mandates.
Local GovernmentLean peopleRef: Sec. 1(2)(b); Sec. 1(3); Sec. 2(1)(c)Exempts DCYF from fiduciary responsibility when youth or third parties serve as payees, potentially reducing accountability and leaving vulnerable youth without recourse if mismanagement occurs—though this also avoids imposing fiduciary liability on DCYF, which could deter participation.
Rights & LibertiesLean peopleRef: Sec. 1(4)Raising the savings account threshold from $500 to $2,000 may delay access to invested assets for youth who need liquidity for immediate needs (e.g., rent, transportation), especially if accounts are not easily accessible or youth lack financial literacy.
FinancialLean peopleRef: Sec. 2(1)(c) (savings threshold increase to $2,000)Requires DCYF to contract with external entities for financial account management, which may benefit large financial institutions or fintech firms over community banks or credit unions—potentially consolidating financial services for vulnerable youth in ways that exclude smaller local providers.
Business & EmploymentPeopleRef: Sec. 1(2)(b); Sec. 1(3)
Who Is Most Affected
Youth aged 18–21 in foster care are the primary beneficiaries: they retain full access to federal benefits, gain financial autonomy, and receive support to build assets—reducing risk of homelessness, poverty, and poor health outcomes post-emancipation.
DCYF staff face increased workload and training demands but avoid fiduciary liability when youth or third parties serve as payees—reducing legal risk but straining already-constrained resources.
Families or trusted adults may gain involvement in youth’s financial planning but are not held to fiduciary standards by DCYF—reducing their legal exposure but also reducing institutional support for their role.
Large financial institutions may benefit from DCYF contracts to manage youth accounts, while community banks/credit unions may be excluded due to scale or compliance requirements—reinforcing financial inequality in access to services.
State and local governments face reduced short-term revenue (no reimbursement from federal benefits) and increased administrative costs, potentially diverting funds from other youth services or requiring budget reallocations.