A Lane County judge blocked Oregon child welfare officials from sending a foster child to live at an Idaho facility earlier this month after the boy’s attorney pointed out a technicality that could impact the state’s ability to place more foster children there.

The Department of Human Services sends more foster children to live at Mountain Home Academy in southern Idaho than any other facility outside Oregon. The state pays Mountain Home thousands of dollars every day to care for the boys it has sent there.

A 1975 law says facilities that take in Oregon foster children must be incorporated. Mountain Home is a limited liability company, a type of business that is not incorporated.

The law was adopted before limited liability companies existed, so lawmakers at the time did not consciously exclude LLCs from caring for foster children. But the law was never updated to include LLCs in the 26 years they have been legal, and the Lane County court ruled DHS must follow it.

The judge refused to send the boy there because of the incorporation requirement, confirmed three people who attended the Jan. 8 hearing in Eugene.

Despite the ruling, state child welfare officials contend the 1975 law applies only to facilities licensed in Oregon, not those operating outside the state. DHS will still consider sending additional foster children to live at Mountain Home if necessary, said Jake Sunderland, an agency spokesman.

“A judge made a ruling in a child-specific case,” he said.

Senate Human Services Chair Sara Gelser, D-Corvallis, has brought intense scrutiny to the state’s practice of placing foster children outside Oregon and attended the Jan. 8 hearing. She said she believes DHS will halt sending more foster children to live at Mountain Home. The judge found the language of the law plainly did not allow it.

“That’s a lot of time to invest in a potential placement for a kid if they know that there’s a problem,” Gelser said.

Located 100 miles from the Oregon border, Mountain Home cares for nearly half of the 20 foster children living outside the state. All its residents are male. Some Oregon boys sent to live there remained at Mountain Home for more than two years, Gelser said.

A fence surrounds the facility, Gelser recalled from a visit there earlier this month with DHS officials, including Director Fariborz Pakseresht and Child Welfare Director Rebecca Jones Gaston. Gelser found Mountain Home Staff caring and engaged and left impressed with the quality of its educational program.

“The facility didn’t raise the level of concern that I’ve had against some of the facilities I’ve seen,” she said.

Mountain Home, like the four other out-of-state facilities where Oregon foster children live, is owned by an umbrella business based in Alabama called Sequel Youth and Family Services.

Gelser has traveled to many of the facilities and others used by DHS in the past. Child welfare officials relied increasingly on providers outside Oregon after they agreed in February 2018 to severely limit their practice of housing children in hotels in response to a federal lawsuit.

Gelser has voiced consistent concerns about the treatment of children at the out-of-state programs, as well as the state’s oversight of the children’s care. At one Senate hearing last year, she questioned child welfare officials why she learned before they did that an Oregon child had been hospitalized after he was beaten at a Sequel facility in Iowa. At a different Senate hearing months later, she said Sequel executives gave state officials “demonstrably false” information about the level of care they provide.

Gelser championed a bill passed last year that requires Oregon DHS to post basic details online about the children sent to live outside the state and the programs at which they reside.

Amid the scrutiny, state officials have drastically reduced the number of children living out of state by sending fewer away and by bringing others back to their home state.

“People are working really, really hard,” Gelser said.

In the daily lives of foster children, it likely makes no difference whether they reside in a facility operated by a limited liability company or a corporation, several lawyers told The Oregonian/OregonLive.

“The problem is that both of those create a for-profit paradigm,” said Alan Reynoldson, a Newport attorney who has represented a foster child sent to live outside Oregon. He was not involved in the Lane County case.

Corporations and companies face an inherent conflict of interest between the children they serve and the owners who expect profits, he said.

“The bottom line is they take in money and make a profit if they can reduce their costs enough,” he said.

Executives at Sequel said they are in close contact with DHS and would comply with any necessary legal requirements.

“We will continue to work collaboratively with the state to address the significant needs of Oregon’s at-risk youth while meeting all state and federal requirements,” the company said in a statement.

As it stands, DHS doesn’t include the incorporation requirement in its contracts with out-of-state facilities, Sunderland said.

“We did not see a specific safety reason to parse out the difference,” he said.

Lawmakers did update the law in 2019 to add county-operated programs to the list of approved providers. The change was one of many to bring state law in line with federal legislation. Limited liability companies were never added.

The impact of the law first came to light when Gelser tweeted about the court hearing.

The boy’s attorney did not return multiple messages left to comment about the case, and a woman who answered the phone at Judge Jay McAlpin’s office said Lane County judges can’t comment on rulings they issue.

Gelser and two others who attended the hearing said the judge delivered his ruling with an admonition: The state does not have enough capacity to make sure foster children have the specialized care they need inside Oregon.

“It was sobering, because there weren’t a lot of good options for this kid,” she said.

Traveling to the facilities is important, Gelser said, so state officials can understand more about the types of services they need to build up inside the state.

Foster children who are able to return end up a variety of places, from back with their families to independent living programs to similar facilities in Oregon, Gelser said. Some age out of foster care.

On the final day of December, 20 Oregon foster children remained out of state. Nine were younger than 15.

-- Molly Young

myoung@oregonian.com

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