CDCAN REPORT #046-2011: Senate committee analysis says size of Brown Administration's $750 million general fund cut to regional centers & developmental services too high & "not achievable"

SENATE BUDGET COMMITTEE HEARING TODAY 10 AM

• Senate Budget Committee Analysis Says Size of Brown Administration’s $750 Million Cut To Regional Centers & Other Developmental Services Is Likely Too High and “Not Achievable”
• Signal That Senate Committee May Reduce Size of Cut

SACRAMENTO, CALIF  (CDCAN) [Updated 02/17/2011 – 06:30 AM  (Pacific Time)] –  The Senate Budget and Fiscal Review Committee staff analysis for today’s (February 17) hearing covering developmental services and other budget issues, concluded the size of the Governor’s proposed $750 million reduction in State general fund spending for regional centers and other developmental services is likely too high and “most likely, not achievable” at the level proposed due to a number of factors.  That committee analysis is a strong signal that Senate Democrats – who control the Senate budget panel – will reject the size of the reduction amount that the Governor wants – and reduce it to some smaller number when the Senate budget committee meets today at 10:00 AM in the State Capitol in Room 4203.

Senate Budget and Fiscal Review Committee staff analysis indicated that the “reduction level proposed by the Administration lacks specifics and is most likely, not achievable due to the cumulative effect of prior year reductions, reductions in “generic” services [non-regional center funded services such as Medi-Cal, In-Home Supportive Services] which result in increased costs in the Community-Based Services, and coupled with the involved needs of people with developmental disabilities who require specific services and supports.”

The Assembly Budget Committee will take up these issues tomorrow (Friday, February 18th).  All actions by both committees still require final approval from both the full Assembly and State Senate in floor votes expected sometime during the last week of February or first week of March.

The Senate budget committee hearing today is the second of a series of three hearings the full Senate Budget and Fiscal Review Committee is holding to take final actions on the Governor’s proposed 2011-2012 State Budget (the first hearing was held yesterday on Medi-Cal and Healthy Families and other budget issues – see separate CDCAN Report #044-2011 or go to the CDCAN website to view the report at www.cdcan.us.

Governor’s Proposed Cut to Developmental Services Would Total $1.150 Billion (All Funds) If Approved By Legislature

• The Brown Administration proposed an overall reduction of $750 million in State general fund spending for developmental services  or about $1.150 billion (including federal and other funds). 
• Some of that reduction amount will come from increased federal matching funds and fund shifts. 
• About $100 million of the cut in State general funds will come from various proposals – including imposing accountability and transparency measures that the Senate budget panel will also consider approving today.
• But the largest portion of the $750 million reduction - $423.9 million in State general fund reductions – has not yet been detailed by the Brown Administration.
• It is that amount – which the Senate Budget committee analysis believes is too high - that the Brown Administration is hoping to achieve by imposing statewide standards or limits on what the regional centers can spend on community-based services – known as “Statewide Standards for the Purchase of Services”.
• Proposed statewide standards to limit spending of regional center community based services was first proposed by Governor Gray Davis in 2002 and 2003 – and both times rejected by the Legislature. 

Senate Democrats Support Governor’s Overall $12.5 Billion Spending Cut Target But Are Looking To Replace Some Cuts With Other Ways To Save Money

Earlier this week Sen. Mark Leno (Democrat – San Francisco, 3rd State Senate District), chair of the Senate Budget and Fiscal Review Committee,  indicated that Senate Democrats supported the Governor’s overall target of $12.5 billion in cuts in State general fund spending but would look to replace some of proposed reductions – including the proposed limit on CalWORKs grants and the size the developmental services cuts - with other ways to save money.

Brown Administration’s Proposal To Develop Statewide Standards or Limits on Regional Center Community-Based Spending Called “Broadly Crafted”

• The Senate budget committee analysis however did not recommend outright rejection of  the Brown Administration’s proposal to develop statewide standards or limits on spending of community-based services by regional centers for 240,000 children and adults with developmental disabilities – a proposal know as “Statewide Standards for the Purchase of Services” for the Legislature to consider approving in late May or June.
• The committee analysis called the Brown Administration’s proposed legislative language [called “budget trailer bill language”]  to develop “Statewide Standards for the Purchase of Services”  as “broadly crafted” and “…provides sweeping authority to the DDS [Department of Developmental Services] to discern what the core aspects of the Statewide Standards should be and the timeframe provides for limited interaction with the public and deliberative process of the Legislature.”
• The analysis seemed to signal that the Senate budget committee may look at tightening the proposed legislative language that directs the Brown Administration to develop proposed statewide standards for later approval by the Legislature and not outright rejection of the proposal at this point.

Process to Develop Statewide Standards or Limits Outlined

The Brown Administration, as represented by the Department of Developmental Services outlined the following process to achieve the reduction of $423.8 million (out of the $750 million overall proposed cut in State general fund spending to developmental services):

• Brown Administration Submits Proposed Trailer Bill Legislation to begin development of Statewide Standards for the Purchase of Services [CDCAN Note: trailer bills are bills that make additions or changes in State law to implement some part of the State budget. Those bills follow – or trail – the main budget bill and are passed and signed into law after the main budget bill is passed and signed into law]

Department of Developmental Services Convenes Eight Subject Area Workgroups

• Department of Developmental Services holds 3 Public Forums; and
• Brown Administration Submits additional proposed Trailer Bill Legislation (to make necessary changes in State law to implement the Statewide Standards for the Purchase of Services) submitted in June for the Legislature to consider and approve

The Brown Administration also, in the committee analysis, outlined the following timeline, which it previously disclosed at the two Assembly and Senate budget subcommittee hearings on February 3rd and 10th (and previously reported in a CDCAN Report in January):

• Initiated an on-line survey (January 27th to February 15th) to solicit initial ideas from the general public
• Commence with eight subject area Workgroups from end of February to May (about two months).
• March 1, Legislature adopt proposed trailer bill language by the Brown Administration as part of the State Budget, that directs the Department of Developmental Services to develop Statewide Standards on the Purchase of Services
• Department of Developmental Services releases draft proposed Statewide Standards publicly and will hold 3 Public Forums in May 2011 for public to comment on the draft proposal.
• Brown Administration submits final proposed Statewide Standards to Legislature, along with draft proposed changes need in State law to implement those standards  and related budget information in June, 2011.

Senate Budget Panel Will Take Action on Regional Centers & Developmental Services; SSI/SSP, MSSP and Foster Youth Transitional Housing Program

As previously reported Wednesday evening, the Senate committee will take final action on several major health and human services budget items (and also other items from other budget areas), including:

• All of the Governor’s proposals impacting regional centers and developmental services including the controversial $750 million reduction in State general fund spending, proposal to develop (for later approval by the Legislature) statewide standards to limit purchase of services – the part of the regional center budget that funds community-based services and supports for over 240,000 children and adults with developmental disabilities. 
• Governor’s proposed elimination of the Multipurpose Senior Services Program (MSSP),
• Governor’s proposed reduction of SSI/SSP individual monthly grants to the lowest amount allowed by the federal government. 
• Governor’s proposed reduction to the foster youth transitional housing program plus. 
• The Governor’s proposed reductions to In-Home Supportive Services (IHSS) and CalWORKS, and also issues related to transferring or “realigning” certain state programs to the counties including Adult Protective Services and Child Welfare Services, will be heard by the Senate budget panel on Friday, February 18th, along with other issues. (See below for details). 
• The Assembly Budget Committee has not taken action on any of these issues and intends to hold only one single hearing to take final action (“close out”) open budget items, on Friday, February 18th  (See below for details)

FEB 17TH SENATE BUDGET & FISCAL REVIEW COMMITTEE AGENDA

CDCAN Note: Budget agenda items of high priority, controversy or interest are highlighted below in bold and also the agenda item is preceded by *** (for persons who are blind or sight impaired and use screen reading devices)

February 17, 2011
Room 4203
10 a.m.

OTHER HEALTH PROGRAMS
Department of Public Health (Budget Item 4265)
1. Additional General Fund Savings

Department of Developmental Services (Budget Item 4300)

1. Summary

2. ***Additional Savings in Developmental Centers

3. Developmental Center Capital Outlay Requests

4. ***Proposed Trailer Bill Language Package on Regional Center Services (Items “A” Through “E”)

A. Trailer Bill: Administrative Costs Cap

B. Dispute Resolution and Third-Party Liability

C. Audits

D. Conflict of Interest

E. Accountability and Transparency

5. ***Additional Savings in Regional Centers (Issues 1 through 3)

Issue 1.Reduce Agnews Community Placement Staff. This technical issue would reduce by $1.5 million State general funds.

Issue  2. Federal Fund Shifts for Regional Center Operations - A reduction of $8 million State general funds is recommended by shifting certain Regional Center project costs and Operations to federal funds ($3 million to Home and Community-Based Waiver, and $5 million to Money Follows the Person). Federal funds would be increased by $8 million

Issue 3.Adjustment for Large Facilities. A reduction of $1.7 million in State General funds is recommended by obtaining federal funds through the Home and Community-Based Waiver for consumers who are Medi-Cal eligible and residing in facilities with 16 or more beds.

6.      Conforming Action: Adjust Regional Center Purchase of Services to Conform to Medi-Cal Programs Actions of Senate Budget Committee

7.      ***Continuation of 4.5% Reduction to Regional Center Operations & Purchase of Services

8.      ***Budget Bill Language for Prevention Program

9.      ***New Cost Containment & Statewide Purchase of Services Standards

Department of Mental Health (Budget Item 4440)

1.      Expansion of Psychiatric Program at California Medical Facility--Vacaville

PUBLIC SAFETY

 (Six agenda items)

HIGHER EDUCATION

CaliforniaStateLibrary (Budget Item 6120)

(1 agenda item)

Universityof California(Budget Item 6440)

(5 agenda items including unallocated reduction of $500 million State general funds)

CaliforniaState University(Budget Item 6610)

(4 agenda items including unallocated reduction of $500 million State general funds)

CaliforniaStudent Aid Commission (Budget Item 7980)

(2 agenda items)

HUMAN SERVICES

Health & Human Services Agency – Office of Systems Integration (Budget Item 0530) – Vote Only Item - New Budget Bill Language

Department of Aging (Budget Item 4170)

1. ***Proposal to Eliminate the Multipurpose Senior Services Program (MSSP)

Department of Child Support Services  (Budget Item 5175)

(2 agenda items)

***Department of Social Services (Budget Item 5180)

1.      ***Supplemental Security Income/State Supplementary Payment (SSI/SSP) – Proposal to Reduce SSP Grants For Individual Recipients

2.      ***Transitional Housing Program-Plus (THP-Plus) – Governor’s Proposal to Reduce Funding by Over 50%