Abuse allegations haunt lucrative group homes
By Lauren Sausser

‘Incredibly powerful’ industry

More than 7,000 group homes and orphanages for children across the country pull in about $8.8 billion a year and employ almost 130,000 people, according to an industry report published last year by IBISWorld, a national research firm.

More than 67 percent of this money comes from government contributions and grants.

In South Carolina, the Department of Social Services spent more than $28 million in the 2014 fiscal year placing almost a quarter of all foster children in more than 90 group homes across the state.

Before Boys Home of the South closed in 2014, the Department of Social Services paid the group home nearly $3 million in five years, but other group homes typically make much more.

The Connie Maxwell Children’s Home in Greenwood made about $11 million in 2013 from several revenue sources, according to public tax records. Epworth Children’s Home in Columbia made $6.8 million. Thornwell Home for Children in Clinton made $8 million. This group home and its related organizations, affliated with the Presbyterian Church (U.S.A.), compensated its president $196,000 in 2013 — $90,000 more than Gov. Nikki Haley’s salary.

“There’s a built-in source of waste that could be used to fund more supportive foster homes for these kids,” said Ira Lustbader, the litigation director for Children’s Rights, a national advocacy group. “Something is just way out of whack in South Carolina on this issue.”

Sue Berkowitz, executive director of the South Carolina Appleseed Legal Justice Center, said group homes make so much money because their interests are well represented by lobbyists and lawmakers.

“It’s no different than nursing homes. It’s more humane and cheaper for us to have community, long-term care and to keep elderly and severely disabled people in their homes, yet the nursing home lobby is incredibly powerful,” Berkowitz said. “Some of them have been just absolutely horrendous.”

Group homes are entitled to make money, she said, but children have been hurt and she doesn’t think the state is doing enough to protect them.

“We’re not doing what we need to do up front to figure out who needs to go where and how they should be placed,” she said.

‘Demonizing DSS’

Some state leaders, including former Department of Social Services Director Lillian Koller, tried to reduce the number of children sent to live in group homes with limited success.

In 2009 and 2010, a handful of these group homes in South Carolina closed, and others were forced to scale back operations.

These closures illustrated a national trend. Similar facilities in other states also shut their doors as the number of children in foster care dropped across the country and as federal funding and private donations dwindled. Best practices indicated children were better off living with families anyway. Koller supported this shift away from group homes.

Deborah McKelvey, the executive director of Windwood Farm in Awendaw, remembered Koller and her deputy director addressing group home employees at an industry meeting in 2011. “They said, ‘We don’t value what you provide any more. We don’t need you.’ ”

McKelvey estimated more than 500 group home “beds” in South Carolina were lost over a five-year period.

“Probably a couple of years ago, they really started making the push that they didn’t want kids in residential placements,” she said. “They used words like ‘languish’ — like (group homes) were torture chambers. They’re not.”

Koller resigned last year amid political uproar that the agency was grossly mismanaged and that children were dying on her watch.

Since then, some group homes in South Carolina have bounced back. McKelvey said Windwood is running at full capacity these days.

“Now, an influx of kids are coming in,” she said. “Our phone does not stop ringing all day long.”

All 15 group home beds at Windwood are filled with children in state custody.

“I hear and read enough horror stories to know that (group homes) are not all good,” McKelvey said. “But there’s certainly a place and a need for group homes, for residential care like we have here.”

Paula Fendley, who represents many group homes in South Carolina as executive director of the Palmetto Association of Children and Families, said the whole Social Services agency needs reform. Group homes, which she estimates employ thousands of people in this state, aren’t the problem.

“We need all kinds of levels of care,” Fendley said. “We need to stop demonizing DSS and stop demonizing providers and demonizing advocates and all figure out what we need to do, instead of just blaming everything on DSS.”