Federal Audit Reveals Thousands of Foster Children Housed in Hotels and Offices Across the Nation

Last updated: July 31, 2026

NewsWK — More than 9,000 children in state foster care systems were temporarily placed in hotels, government office buildings, and state park cabins due to severe shortages of approved foster placements, according to a recent federal audit.

The findings, released by the Department of Health and Human Services (HHS) Office of Inspector General, examine the period between January 1, 2022, and June 30, 2023. According to a report first published by Stateline, state child welfare agencies struggled significantly to secure appropriate settings for older youth and children with complex behavioral or mental health needs, challenges intensified by the nation’s drug crisis and pandemic-related disruptions.

Systemic Placements in Unlicensed Facilities

Under established welfare guidelines, state agencies tasked with taking custody of children removed from unsafe homes are expected to prioritize placements with relatives through kinship care, or secure licensed foster homes that adhere to strict health and safety standards. However, out of 49 state agencies responding to the federal audit, 34 acknowledged placing children in unlicensed settings that were never designed for residential care.

Data from 30 states capable of tracking individual stays revealed 15,705 total emergency placements. While 59% of these temporary arrangements lasted four or fewer days, 28% spanned five days or longer. The average emergency stay lasted one week, though the single longest recorded hotel stay extended to 251 days.

Across the reporting states, 22 agencies logged 2,698 stays inside administrative offices, 17 states reported 1,922 hotel room stays, and 16 states utilized 4,412 stays at other temporary sites, including state park cabins.

State Differences and Lack of Tracking

Concentration of temporary stays varied widely nationwide, with Arizona and Texas accounting for nearly half of all reported placements. Arizona recorded 3,907 placements for 3,481 children, while Texas reported 3,923 placements involving 1,977 children. Tennessee (1,845), Illinois (812), and Washington state (612) also logged high numbers of emergency placements.

The issue has raised accountability concerns, particularly in Tennessee, where Department of Children’s Services Commissioner Margie Quin has been named as a defendant in two proposed class-action lawsuits over allegations regarding child welfare conditions.

Audit results also revealed significant gaps in state oversight. Eight states—including Pennsylvania, Ohio, New York, and Missouri—did not track their emergency placements, while Delaware and Montana submitted no data. Conversely, seven states, including Utah, Iowa, and Wyoming, reported zero emergency placements in unlicensed settings during the audit period.