CALIFORNIA BUDGET (FY 2011/12) SIGNED BEFORE DEADLINE

On Thursday, June 30, Governor Jerry Brown signed the main budget bill (SB 87) and about half of the related "trailer" bills, marking a rare on-time budget one day before the start of California's 2011/12 fiscal year. The signed budget includes cuts to public universities, reductions to the courts and closures of 70 parks, among other measures. Fortunately, for early childhood education, the budget includes the restoration of $200 million in child care funding that was initially passed by the Legislature on June 15. Below is a detailed description of the child care funding restorations in the approved state budget:

 

Child Care Funding Restorations included in the Approved 2011/12 Budget

• Restores 10% Standard Reimbursement Rate cut to the Title V contracts
• Rescinds the proposed 10% family fee increase
• Reinstates child care services for 11- and 12-year old children
• Reduces across the board contract reduction from 15% to 11% (in Education trailer bill - AB 114) Establishes the Early Learning Advisory Council (ELAC) into statute – ensuring its long-term presence

However, the 2011/12 budget does include the following changes and cuts to child care funding:

 

Child Care Funding Cuts included in the Approved 2011/12 Budget

 

CalWORKs:

• Limits families to 48 months of cash assistance (down from 60 months)
• Cuts the CalWORKs grant amount by 8%
• Reduces Earned Income Disregard (income not counted in determining monthly grant amount)
• Extends Short-Term Reforms (allocations effective since 2009/10)
• Suspends the Cal-Learn Program

Child Care and Development:

• Reduces the State Median Income (SMI) from 75% to 70%
• Reduces the licensed exempt provider rate from 80% to 60%
• Reduces the amount of funding focused on quality initiatives (including the Centralized Eligibility List, the License Exempt Project and the Child Care Initiative Project) 

The budget signed by the governor is balanced and it is based upon a relatively even mix of cuts and tax revenues, as well as a smaller amount of funding shifts and internal borrowing. But, there could likely be a future challenge during this fiscal year. This approved budget includes $4 billion in revenues projection; however, if these revenues do not materialize by December 15, a trailer bill AB 121 (budget trigger provisions) will generate additional cuts in education, corrections and safety-net programs, which would take effect January 1, 2012. For example, if revenues fall short by more than $1 billion, then there will be a $23 million loss in child care funding, resulting in a 4% across-the-board reduction.

 

Additionally, the 2011/12 Budget removes child care and development from the Proposition 98 funding formula, with the only exception being half-day state-funded preschool programs. As a result of this realignment, the State General Fund (non-98 portion) would support the rest of child care and development. For the 2011/12 budget, these programs are supported in the allocation to the California Department of Education (CDE). So, at least for now, CDE will continue to administer the child care subsidy programs. It is uncertain if in the future, child care might be administered by local (county) government oversight.

STAND FOR CHILDREN DAY – STATE CAPITOL

On May 4, a delegation of 70 parents and providers representing Community Voices went to Sacramento for the annual Stand for Children advocacy day, sponsored by Parent Voices. There were a total of 780 parents, providers and children at the Capitol that marched and rallied with the loud and unified message: “Child Care Keeps California Working!” The Community Voices delegation was made up of advocates representing Crystal Stairs, Inc., Mexican American Opportunity Foundation (MAOF), Center for Children and Family Services (CCFS), Options, Connections and Pathways, representing parents, providers and children from Los Angeles County.

Stand for Children is an annual event that brings together child care advocates from all around the state to the Capitol to advocate for child care. This year’s focus was protecting child care funding from further cuts and advocating for smart revenue solutions to close the budget shortfall. Delegations carried the message that the State of California cannot rely on cuts alone to balance the budget. In the current budget, $720 million in child care reductions were made, and $500 million was approved and signed into law this past March.

Community Voices was an integral part of these advocacy efforts by joining families and children on the march to the capitol and the rally that preceded it where parent speakers from Butte, Los Angeles, Fresno, Marin and San Francisco Counties joined Assemblyman Ammiano, Assemblywoman Bonilla, Assemblywoman Mitchell, Assemblyman Swanson and Senator Evans. Maria Salinas, a parent advocate and member of Community Voices at Crystal Stairs, spoke at the rally on behalf of the Los Angeles County delegation. Maria Salinas described the need for a budget with revenue solutions to prevent an all-cuts budget, reminding the group that “we need a sensible budget that protects from further harm to families and children.”

Child care advocates received support from several state legislators who spoke at the rally on the steps of the Capitol. The gathering was especially energized by encouraging words from Assemblywoman Holly Mitchell, Chair of the Assembly Budget Sub-Committee on Health and Human Services:

“I hope your wings are strong. I congratulate Parent Voices and Community Voices on all you have done up until now. You have shown passion and perseverance. Your advocacy has been critical in saving Stage 3 and preserving state investment in early care and education. Our efforts must now be redoubled to save access to child care and ultimately to ensure that a safe healthy childhood with access to early care and education is a right instead of a privilege in America.”

Following the rally, parents and providers made visits to legislators asking them to support the Governor’s revenue package, sharing how additional cuts to programs would negatively impact their constituents. Community Voices members visited the offices of both Democrats and Republicans, including Assemblyman Antony Portantino, Assemblyman Mike Eng, Assemblyman Charles Calderon, Assemblyman Ricardo Lara, Assemblywoman Holly Mitchell, Assemblyman Cameron Smyth, Assemblyman Paul Cook; Senator Bob Huff, Senator Carol Liu, Senator Ron Calderon, and Senator Ed Hernandez.

This was a very successful event. Following visits with the legislators, Community Voices members headed back to Los Angeles County. These parents and providers are even more energized to continue their advocacy efforts back at home. For more information about getting involved with local child care advocacy efforts, please contact: publicaffairs@crystalstairs.org.

Submitted by Fred Munoz and Nicole J. Jones, Crystal Stairs, Inc

Photos from the Stand for Children March and Rally

Community Voices Members Marching Through Sacramento

Making Our Way to the State Capitol

Community Voice Members Carrying Signs and Chanting Along March Route

1Child Care Advocates Line the Streets of Sacramento

Parents, Providers AND Children Are Making Their Voices Heard

Community Voices Members Rallying in Front of Capitol

Maria Salinas Speaking Out for LA County Parents

Community Voices Members at Rally

Community Voices Members Head Back to LA County





Big Victory for Thousands of Working Families and Small Businesses

January 14, 2011

Speaker Pérez: Child Care Effort Succeeds--

SACRAMENTO—Assembly Speaker John A. Pérez (D-Los Angeles) today announced that thanks to efforts by the Assembly, California’s local First 5 Commissions, and the Brown Administration, thousands of working parents in California will continue to receive the child care services that allow them to stay in their jobs and keep their families off welfare.

“With the stroke of his blue pencil last fall, former Governor Schwarzenegger forced thousands of working parents to face the choice of losing their jobs or letting their kids fend for themselves,” Pérez said. “Today, I am pleased to announce that we did not let that happen and that this program is in fact being restored and is included in Governor Brown’s budget. This is a big win for working parents and their children, and also for the thousands of small business child care providers who would have had to close their doors or lay off their employees.”

In December, Speaker Pérez introduced AB 1, the first bill introduced in the 2011-2012 session of the Assembly, to reverse Schwarzenegger’s veto and restore the Stage 3 Child Care services that enable parents to transition from welfare to work. Speaking from the Assembly floor today, Pérez announced AB 1 would now be used as a vehicle if one is necessary to allocate existing transition funding until the budget is enacted and the program officially restored.

“Not only did Governor Brown hear us and restore Stage 3 Child Care in his budget this week, his administration is also actively working with us to identify existing funding that can be used to transition until the budget is enacted,” Pérez said. “As we move forward, should it be determined that any interim funding we identify requires authorizing legislation, I will make AB 1 available for that purpose.”

More than $40 million in bridge funding – including $6 million from cuts Speaker Pérez made to the Assembly’s own budget and additional funding he sought from the county First 5 commissions – helped buy time until Stage 3 Child Care services could be restored. A judge’s stay of the elimination of the services also allowed time for Speaker Pérez and other advocates to successfully push for the program’s restoration.

“Of course, there are still difficult cuts proposed to all child care programs – and undoubtedly, the final budget will have to include some of the proposed reductions,” Pérez said. “But as painful as those cuts may be, they will still be far better than Governor Schwarzenegger’s wholesale elimination throwing 60,000 families out of the workforce or their children into harm’s way. This is a very positive sign we can work with this Governor to create jobs, put California’s fiscal house in order, and make sure every Californian can find opportunity and the chance to succeed.”
Timeline:

October 8, 2010—Governor Schwarzenegger blue-pencils Stage 3 Child Care funds eliminating services for 81,000 children in 60,000 families transitioning from welfare to work.

October 19, 2010— Assembly Speaker John A. Pérez pledges $6 million from part of his 15% cut to the Assembly operating budget and contacts state and county First 5 commissions asking for help in providing bridge funding until Stage 3 Child Care can be restored. Local commissions take action throughout the next several weeks.

October 29, 2010—Alameda County judge issues stay in implementation of the cuts and orders November hearing.

November 5, 2010—Speaker Pérez announces more than $40 Million in bridge funding pledged so far.

November 17, 2010—Judge approves settlement keeping child care services available through end of year.

Dec 6, 2010— Speaker Pérez introduces AB 1 to reverse the veto and restore Stage 3 Child Care.

January 10, 2011—Governor Brown includes Stage 3 Child Care funding in his 2011-2012 budget proposal.

January 14, 2011—Speaker Pérez announces victory for working families and providers. Moves AB 1 to become authorizing vehicle if necessary for interim funding identified by Assembly and Brown Administration.

FOR IMMEDIATE RELEASE CONTACT: Shannon Murphy (916) 319-2408

Recently Elected Governor Jerry Brown Unveils New Budget Proposal for 2011-2012

On January 10, 2011, Governor Jerry Brown unveiled his 2011 - 2012 budget proposal addressing a $25.4 billion projected shortfall for the remainder of the 2010-11 and the upcoming 2011-12 fiscal years. The Governor’s budget includes many significant ongoing program reductions, posing very difficult decisions for the Legislature. His proposals touch nearly every area of the state budget—often (as in Medi-Cal) with proposed reductions similar to ones suggested by the prior Governor and rejected by the Legislature. While the Governor’s revenue proposals result in a $2 billion increase in the Proposition 98 minimum funding guarantee for schools above its current-law level, his budget would result in a small programmatic funding decline for K-12 and more significant reductions for community colleges and child care programs.


Here are the cuts as it pertains to Child Care, for detailed information on the budget please visit http://www.ebudget.ca.gov/:

Child Care and Development Program (Proposition 98)

General Fund Solutions

Decreases direct child care services, except Preschool, by $716 million in 2011-12 through the following actions:


• Eliminates services for 11-and 12-year olds. Reduces by $34 million CalWORKs Stage 1 (administered by Department of Social Services, savings reflected in that section) related to the elimination of this program.


• Reduces eligibility to 60 percent of the State Median Income from 75 percent of the State Median Income.


• Reduces the level of subsidies across the board.


• Provides greater flexibility at the local level to administer the remaining child care funding in order to implement the across-the-board reductions. In this regard, subsidized families would pay the difference between the subsidy and regular day care provider charges as a co-payment directly to the provider in lieu of the state’s administrative agents (Alternative Payment agencies and Title 5 contractors) assessing and collecting current family fees.


General Fund Policy Adjustments


• Sets aside $52.6 million in 2010-11 from one-time Proposition 98 settle-up funding to continue services for Stage 3 families effective April 2011, at a service level consistent with the policy solutions proposed for 2011-12. These policy solutions affect age and income eligibility and reduce subsidy levels across the board for all direct service child care programs.

• Decreases by $34.2 million in 2011-12 to reflect lower Stage 2 caseload projections to conform with the 48-month time limit that replaces long-term reforms as discussed in the Health and Human Services section.

General Fund Adjustments
• Increases CalWORKs Stage 2 by $241.5 million in 2011-12 to reflect a $4.2 million caseload increase and restoration of one-time funds used to support services in 2010-11 ($201 million of Proposition 98 one-time savings and $36.3 million American Recovery and Reinvestment Act (ARRA). Total base workload costs for Stage 2 is $435.2 million.

• Increases CalWORKs Stage 3 by $256.2 million in 2011-12 that reflects a caseload reduction of $42.4 million, restoration of one-time funds used in 2010-11 totaling $42.4 million ($23.7 million of prior year federal funds and $18.9 million ARRA), and restoration of the $256 million partial-year veto. Total base workload cost for Stage 3 is $342.4 million.

• Increases by $83.1 million in 2011-12 to restore General Child Care, State Preschool, Migrant Child Care, and Allowance for Handicapped programs that were required to utilize excess contract reserves to meet costs in 2010-11.

Non-General Fund Adjustments
• Decreases the Child Care and Development Funds (CCDF) by $18.5 million in 2011-12 to reflect removal of one-time carryover funds available in 2010-11 ($24.4 million), an increase of $3.2 million in carryover funds reserved for expenditures that promote quality improvement, and $2.7 million in available base grant funds.

• Decreases the ARRA funds by $110.1 million in 2011-12 to reflect the one-time nature of the fund source used for child care program for two years.

• Increases by $58 million in 2010-11 from unanticipated prior year federal CCDF carryover funding in 2010-11 to reflect additional costs driven by a court order to extend the date for Stage 3 funding termination from November 1 to December 31, 2010.

• Decreases the Federal 21st Century learning Centers by $23.1 million in 2011-12 to primarily reflect a change in prior year federal carryover funds utilized for this federally funded afterschool program in 2010-11.
• Increases the Early Learning Advisory Council by $948,000 for state operations in 2011-12 from federal funds for the second year of the three-year federal grant recently authorized for the support of state early learning advisory councils.

Department of Social Services

CalWORKs

• Eliminates monthly CalWORKs benefits for families that have received aid for 48 months or more. Child-only benefits, provided now when the adult is removed from the case, would continue beyond the 48-month time limit for families fully meeting work participation requirements. Child-only benefits would also continue for families with unaided adult recipients of SSI/SSP and non-needy caretaker relatives. Currently, California provides aid to eligible families up to 60 months and provides benefits to children until the age of 18 years. This new, shorter time limit of 48 months would result in a $698.1 million reduction to the program in 2011-12. This proposal assumes enactment of legislation by March 1 and implementation on July 1, 2011.

• Reduces CalWORKs grants by 13 percent, resulting in a lowering of the maximum monthly grant for a family of three in a high-cost county from $694 to $604 effective June 1, 2011, for a savings of $13.9 million in 2011-11 and $405 million in 2011-12. This proposal assumes enactment of legislation by March 1 to effectuate the June 1 implementation. The current grant level is lower than grants in 20 other states after adjusting for housing costs and has not been adjusted over time to match inflation or increases in the cost of living, thus making it lower than it was in 1989, dollar for dollar. CalWORKs provides benefits to more than 580,000 families with over 1 million children.

• Continues the reduction in the CalWORKs single allocation for 2011-12, resulting in savings of $376.9 million. The single allocation is the funding for CalWORKs employment services, child care, and county administration, the programmatic elements that make the CalWORKs program a welfare-to-work model to enable self-sufficiency over time for unemployed parents and low-income families. This funding reduction severely inhibits the ability for counties to assist needy families in their search for and ability to maintain work that would allow them to meet work participation standards and continue to receive basic assistance to meet shelter, food, clothing, transportation, and other living needs.