A National Imperative: Joining Forces to Strengthen Human Services in America (Jan 2018)

CHALLENGE #3 Regulations and requirements

Overlapping, conflicting, and outdated regulations. Human services CBOs face regulatory requirements through multiple agencies at the federal, state, and local level. Regulations are often interpreted in drastically different - and sometimes needlessly conservative - ways by different federal, state, and local agancies. In many cases, these regulations overlap, conflict with one another, or are outdated. CBOs are required to perform redundant actions, including audits of programs and contracts, or straddle the line of non-compliance with one regulation to be in compliance with others. This phenomenon is pronounced when CBOs contracting with state or local government agencies receive funding that originates at the federal level. In such an instance, CBOs typically must adhere to regulatory requirements at both levels of government. This may in turn require CBOs to report program information in slightly different ways to multiple agencies, participate in redundant audits of program activities and spending, and, in some cases, choose between adhering to spending or service delivery requirements at one level of government or the other (e.g., caps on certain types of spending at the state or local level conflicting with service obligations at the federal level). Compliance costs incurred by CBOs are far from trivial. As one human services CBO CEO put it, “We get federal, state, and county funding. Each comes with its own set of rules, and at each level, they want a lot of the same information in slightly different ways. We could save a lot of time and money if things were more standardized.” Unfundedmandates in the form of new regulations. When government agencies and regulators introduce new policies and rules, human services CBOs typically incur costs to come into compliance. Very seldom do government agancies estimate compliance costs to CBOs of these policies in comparison to the potential benefits. Moreover, CBOs are often left to handle these costs alone without increases in funding. These regulations may serve important purposes – for example, requiring that CBOs remain accessible to those with disabilities or to those who do not speak English. But they are often created in a reactive manner, with regulators responding to publicized events such as an accident involving a CBO client or an incident of fraud or abuse. “The desire to just do something trumps any sort of logic,” a human services CEO described. “No one takes a step back to figure out whether more regulations will actually make a difference, other than making it harder and more costly for us to serve our customers.” Many CBO leaders we spoke to described this dynamic. They may agree with the intention behind new regulations. But as one CBO described it: “How can the government require us to spend more and then deny us funding increases in the same breath? The math just doesn’t work out”. These “unfundedmandates” can affect state and local government agencies as well. Many are issued at the federal level and create compliance requirements for state and local government agencies, as well as for human services CBOs. Growing litigation risk. Human services CBOs often provide services to people in precarious and very high-risk situations (e.g., those impacted by domestic violence, child abuse, or who are at risk of suicide or with significant mental illness or complex substance abuse disorders). When the government directly provides these services, it generally enjoys some form of sovereign immunity. The government cannot be held liable for injuries or other

| 37