MEMORANDUM

Date: August 21, 2020
To: Lindsay Lierman, CASA of Adams and Broomfield Counties
From: Patricia Silverstein, Development Research Partners
RE: The 2020 Business Case for Court Appointed Special Advocates (CASA)

Investments in human capital are critical for economic growth and development. A wealth of research links higher levels of educational attainment to better economic outcomes including higher earnings, lower unemployment, and increased productivity. More productive workers make businesses more profitable and a region more competitive. Alternatively, leaving the next generation of workers behind, especially those that are at-risk, vulnerable, and disadvantaged, imposes significant costs to governmental entities, businesses, and society through increased poverty, crime, and costs to the legal and public assistance systems.

The unemployment rate in Colorado averaged just 2.8 percent in 2019, indicating that about 87,000 people across the state were actively seeking a new job. This tight labor market environment made it difficult for businesses to find and retain the workers needed. This situation changed significantly in March 2020 when the World Health Organization declared a pandemic when a novel coronavirus, now called COVID-19, spread rapidly across the globe. The virus’ rapid spread led to progressively more restrictive guidance issued by individual communities, culminating in Governor Polis issuing an executive order on March 25th ordering Coloradans to stay in place, ultimately through May 8th. All businesses except those specifically deemed critical in the executive order were closed or shifted to remote work/remote learning. This has resulted in a rapid loss in business income and employment and rapidly rising unemployment.

While the restrictive measures were necessary to contain the pandemic and save lives, there has been a significant shift in economic activity. As the current business focus has shifted from challenges with finding workers to keeping the doors open, the work of CASA remains critical. The CASA system addresses a significant need in our Colorado communities, advocating for abused and neglected children in the pursuit of safe and permanent homes. A focus today on our future workforce means that Colorado will be better positioned to achieve sustainable economic growth once the health crisis is over.

Reduced Lifetime Social Costs

A national survey by Voices of Youth Count, a national initiative of Chapin Hall at the University of Chicago, found that one in 10 American young adults ages 18 to 25 endured some form of homelessness over a 12-month period in 2016 and 2017. (i) A separate Chapin Hall study explains that housing stability makes it easier for young people to stay in school and achieve educational success, which increases long-term income. Conversely, low educational attainment is a risk factor for homelessness and homelessness is a risk factor for lower educational attainment. (ii)

Unfortunately, the prevalence of homelessness for children who aged out of foster care, meaning that they turned 18 (or 21, depending upon the state) and legally became an adult before being placed in a permanent home, tends to be even higher. National data indicate that more than 20 percent of young adults that aged out of foster care were homeless after age 18. (iii)

The Jim Casey Youth Opportunities Initiative estimated that the lifetime social cost of a teen aging out of foster care was about $300,000 in 2013, including the social costs of incarceration, public assistance, and the value of lost wages. (iv) Inflating this estimated cost to today’s dollars means that the social cost of someone aging out of foster care in 2018 was approximately $323,400. Therefore, the lifetime cost to taxpayers and communities of the 225 youth who aged out of the Colorado foster care system in 2018 was an estimated $73 million.

Of the 221 children’s cases closed by CASA of Adams and Broomfield Counties in FY 2020, 1.8 percent of these cases were closed due to the child aging out of the foster care system, which is lower than the 5.1 percent statewide average from FY 2016 to FY 2018. Assuming this differential represents the benefit of CASA of Adams and Broomfield Counties, the program resulted in about 7 fewer children aging out of the foster care system, thereby reducing the lifetime cost to the state by about $2.4 million.

Increased Lifetime Earnings

The Northwest Foster Care Alumni Study estimated that the national high school graduation rate for children who were in foster care between 1988 and 1998 was just 56.3 percent.(v) The kids who fail to graduate from high school have a significant disadvantage as they try to find work and earn a living. According to the U.S. Bureau of Labor Statistics, high school graduates have median earnings 26 percent higher than those with less than a high school diploma. Further, the unemployment rate for high school graduates was 1.7 percentage points lower than for those without a high school diploma or equivalent in 2019. (vi)

CASA of Adams and Broomfield Counties reported that 69.2 percent of their children’s cases closed with a permanent home in fiscal year 2020. These children are more likely to remain out of the child welfare system and graduate from high school. Assuming that children with cases closed in FY 2020 through CASA of Adams and Broomfield Counties achieved graduation rates similar to the Colorado average of 81.1 percent in 2019, the improved graduation rate would lead to increased lifetime earnings of $11.4 million. (vii)

Value of Volunteerism

CASA of Adams and Broomfield Counties’ volunteers contributed 19,474 hours of service at an estimated value of $574,500 in fiscal year 2020. (viii) The time they spend with each child’s case saves the time and expense of social workers and attorneys.

The activities of the CASA of Adams and Broomfield Counties in 2020 reduced the lifetime social costs and increased the lifetime earnings of the children served, improving Colorado’s communities and the business environment.

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(i) Morton, M.H., Dworsky, A., & Samuels, G.M. (2017). Missed Opportunities: Youth Homelessness in America: National Estimates. Chicago, IL: Chapin Hall at the University of Chicago.
(ii) Kull, M.A., Morton, M.H., Patel, S., Curry, S. & Carreon, E. (2019). Missed Opportunities: Education Among Youth and Young Adults Experiencing Homelessness in America. Chicago, IL: Chapin Hall at the University of Chicago.
(iii), v Casey Family Programs. (1998). Northwest Foster Care Alumni Study. Seattle, WA.
(iv) Jim Casey Youth Opportunities Initiative. (2013). Cost Avoidance: The Business Case for Investing in Youth Aging Out of Care.
(vi) U.S. Bureau of Labor Statistics. (May 2020). Learn More, Earn More: Education Leads to Higher Wages, Lower Unemployment.
Career Outlook. https://www.bls.gov/careeroutlook/2020/data-on-display/education-pays.htm
(vii) DRP calculation based on The Trellis Company, State of Student Aid in Texas – 2018. https://www.trelliscompany.org/state-of- student-aid-2018/
(viii) DRP calculation based on Independent Sector, (2018) The Value of Volunteer Time / State and Historical Data, 2001-2019. https://independentsector.org/resource/vovt_details/