The proposed legislation, titled the "Federal Benefits for Children in State Custody Act," mandates that the Children, Youth and Families Department (CYFD) determine the eligibility of children in its custody for federal benefits within sixty days of their placement and annually thereafter. If a child is found to be receiving federal benefits, the department must either identify an appropriate representative payee or apply to become the payee itself if no other candidates are available. The bill outlines the department's obligations when acting as the representative payee, including establishing an account for the child's benefits, notifying relevant parties of any decisions regarding benefits, and providing annual accounting of the benefits' use.

Additionally, the bill prohibits the use of federal benefits to cover the costs of the child's care, allowing the department to use these funds only for unmet needs beyond its obligations. Upon termination of legal custody, any remaining federal benefit funds must be released to the child or their parent/guardian, depending on the child's age. The CYFD is also required to submit an annual report to the legislative health and human services committee detailing the number of children receiving benefits, the types of benefits, and how those benefits are managed.