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FY12 State Budget Discussion

Policy and Fiscal Committee November 1, 2010

FY2012 – Budget Option Comparison

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Account Desc Topic FY12 MaintenanceFY12 Budget

Option #1FY12 Budget

Option #2

The request which shows the bottom line. Anticipates annualized increases and offers nothing new.

The request which reflects what we really want.

The request which reflects what we want but removes Professional Development and Mental Health proposed increases.

3000-1000 Admin FY12 Collective Bargaining Agreement increases and step increases,

yes yes yes

3000-1000 Admin Quincy and Boston Rent Increases yes yes yes3000-1000 Admin Addition of 11 staff no yes yes, but limited to 63000-2000 Access Annualized Cost for Waitlist System yes yes yes3000-3050 Supportive 8.234% (historical) growth yes yes yes3000-4050 TANF FY11 anticipated expenditure

level plus 3% (historical growth)yes yes yes

3000-4060 IE FY11 anticipated expenditure level on 6/30/11 after closing access on 12/15/10 yes yes yes

3000-4060 IE Transfers $4M to QS for QRIS no yes yes3000-5000 Head Start3000-5075 UPK3000-6000 Qual Supp Transfer of $4M from IE for QRIS no yes yes3000-6000 Qual Supp Addition of $500K to support

Professional Development no yes no3000-6075 Mental Hlth Restores Mental Health to FY10

level no yes no

FY2012 – Maintenance Budget

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Descriptor Line Item FY10 FY11 FY12 Maintenance

Difference between FY11 and FY12 Maintenance -

Caseload % Increase Notes

*Administration 3000-1000 $ 11,622,212 $ 11,417,421 $ 11,722,280 $ 304,859 2.67%

Much of the increase is associated with the FY12 collective bargaining increases for SEIU and NAGE employees and lease increases for the Boston and Quincy offices.

Access Management 3000-2000 $ 6,358,771 $ 5,933,862 $ 6,083,862 $ 150,000 2.53% Waitlist system annualized cost

Supportive 3000-3050 $ 77,836,888 $ 85,713,529 $ 92,767,534 $ 7,054,005 8.23% 8.234% growth TANF Related Child Care 3000-4050 $ 116,232,279 $ 127,358,313 $ 136,244,249 $ 8,885,936 6.98%

FY11 expenditure level plus 3% growth

**Low Income Eligible Child Care 3000-4060 $ 260,954,672 $ 233,527,605 $ 234,929,254 $ 1,401,649 0.60%

Maintains present caseload of 30,000 children.

Grants to Head Start 3000-5000 $ 8,000,000 $ 7,500,000 $ 7,500,000 $ - 0.00%

UPK 3000-5075 $ 8,000,000 $ 7,500,000 $ 7,500,000 $ - 0.00%

Quality Supports 3000-6000 $ 14,032,568 $ 14,011,633 $ 14,011,633 $ - 0.00%

Mental Health 3000-6075 $ 1,000,000 $ 750,000 $ 750,000 $ - 0.00%

Family Supports and Engagement 3000-7050 $ 5,000,000 $ 5,000,000 $ 5,000,000 $ - 0.00%

509,037,390$ 498,712,363$ 516,508,812$ $ 17,796,449 3.57%

*FY11 Admin account includes pending Reserve Draw of $111K for the FY11 CBA increases.**FYII Income Eligible account includes $5M PAC recently passed by the Legislature.

FY12 Maintenance Spending Plan

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3000-1000 (Admin): $304,859• Payroll Related: $288,606

$226K to annualize FY11 Collective Bargaining ($167K), the value of FY11 step increases ($45K) and annualization of Licensor position ($14K). $81,783K to fund FY12 Step increases ($41K) and FY12 CBA increases ($40K). ($24K) decrease because amount found in other accounts to support payroll.

• Lease Spaces: $37,249: The leases for the Boston and Quincy offices expire in FY12 (Boston on August 13 th and Quincy on December 31st) and must be renewed. Also, the Lawrence lease will increase by $4K in FY12.

• Miscellaneous: ($22,700) $27K for postage, paper, equipment leases and other admin expenses; and($50K): Market Rate analysis must be done biannually per CCDF regulations. It will be done in FY11, and is therefore not budgeted in FY12.

3000-2000 (Access Management): $150,000• Annualized cost to maintain COTS Waitlist system.

Child Care Accounts

3000-3050 (Supportive): $7,054,005• Anticipated historical growth of 8.234% each year

3000-4050 (DTA Related): $8,885,936• Anticipated FY11 expenditures plus 3% growth

3000-4060 (Income Eligible): $1,401,649• Maintains existing levels of access (about 55,000 children statewide) in total caseload.

Note that spending in the Supportive and DTA related accounts reflects legislative language that there cannot be a wait list.

FY2012 EEC Budget Request: Option #1

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Descriptor Line Item FY10 FY11 FY12 Budget

Request

Difference between FY11

Appropriation and FY12 Request Notes

*Administration 3000-1000 $ 11,622,212 $ 11,417,421 $ 12,372,785 $ 955,364

Maintenance increase plus the additional 11 positions detailed on slide 5

Access Management 3000-2000 $ 6,358,771 $ 5,933,862 $ 6,083,862 $ 150,000

Waitlist system annualized cost

Supportive 3000-3050 $ 77,836,888 $ 85,713,529 $ 92,767,534 $ 7,054,005 8.234% growth TANF Related Child Care 3000-4050 $ 116,232,279 $ 127,358,313 $ 136,244,249 $ 8,885,936

FY11 expenditure level plus 3% growth

Low Income Eligible Child Care 3000-4060 $ 260,954,672 $ 233,527,605 $ 234,929,254 $ 1,401,649

Maintains present caseload of 30,000 children.

Grants to Head Start 3000-5000 $ 8,000,000 $ 7,500,000 $ 7,500,000 $ -

UPK 3000-5075 $ 8,000,000 $ 7,500,000 $ 7,500,000 $ -

Quality Supports 3000-6000 $ 14,032,568 $ 14,011,633 $ 18,511,633 $ 4,500,000

$4M increase to support QRIS. Addition of $500K to support Professional Development.

Mental Health 3000-6075 $ 1,000,000 $ 750,000 $ 1,000,000 $ 250,000 Restores Mental Health to FY10 level

Family Supports and Engagement 3000-7050 $ 5,000,000 $ 5,000,000 $ 5,000,000 $ -

509,037,390$ 498,712,363$ 521,909,317$ $ 23,196,954

*FY11 Admin account includes pending Reserve Draw of $111K for the FY11 CBA increases.**FY11 Income Eligible account includes $5M PAC recently passed by the Legislature.

FY12 EEC Budget Recommendation: Option #1

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AdminBuild and Maintain Quality Infrastructure

Step 1: Support maintenance needs of admin accountValue: $304,859 This figure is based on the cost of negotiated step increases, the value of collective bargaining agreement raises, the cost of lease increases in the Boston and Springfield offices, an increase in the cost of postage, and other minor costs. There will be staff reductions in FY12 unless funds are restored to the admin account.

Step 2: Rebuild EEC Staffing InfrastructureValue: $650,505 Fill 11 positions essential to EEC infrastructure. We continue to need additional staff to support communication and other roles. This is the first stage in a multi-year effort to rebuild the EEC staff to levels appropriate to provide quality management and delivery of the EEC mission.

Total Value: $955,364

Two Year EEC Staffing Review

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Sep-

08

Oct-0

8

Nov-0

8

Dec-0

8

Jan-

09

Feb-

09

Mar-0

9

Apr-0

9

May-0

9

Jun-

09

Jul-0

9

Aug-0

9

Sep-

09

Oct-0

9

Nov-0

9

Dec-0

9

Jan-

10

Feb-

10

Mar-1

0

Apr-1

0

May-1

0

Jun-

10

Jul-1

0

Aug-1

0

Sep-

10145

150

155

160

165

170

175

180178.1

177.1

174.7 174.2

165.5164.5

162.6 162.2

159.3

EEC Staffing

Staffing

Support Positions in Fiscal, Policy, Quality Supports, and Communication

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FTEs authorized in s tate account: 157.3

Salary Plan Area FTE Risk Analysis Annual CostFY12 Cost Option

1FY12 Cost Option 2 FY13 Cost FY14 Cost

Commissioner's OfficeDirector of Community Partnership and Outreach C 1 1 $75,000 $75,000 $75,000Chief Operations Offi cer I 1 1 $85,000 $85,000 $85,000Director of Pol icy, Eva luation & Research I 1 3 $75,000 $75,000Pol icy Analyst - QRIS Q 1 1 $61,303 $61,303Pol icy Analyst - Genera l i s t Q 1 3 $61,303 $61,303Human Resources & FacilitiesReceptionist I 1 2 $36,058 $36,058Legal UnitManager, Deputy General Counsel I 1 2 $76,000 $76,000Office of AdministrationAudit Resolution: Fisca l Monitor $59,292 I 3 1 $177,877 $177,877 $118,584Office of Field OperationsFami ly/Community Qual i ty Specia l i s t I 2 2 $122,606 $122,606Educator Provider Support Specia l i s t I 2 2 $122,606 $122,606Chi ld Care Licens ing Specia l i s t $50,265 Q 16 1* $804,244 $251,325 $100,530 $251,325 $301,590

30 $1,696,997 $650,505 $379,114 $683,595 $362,893Key: Strategic Plan Area Key: Risk AnalysisQual i ty = Q 1= High RiskCommunications = C 2= Moderate RiskInfrastructure = I 3 = Low Risk

FY12 EEC Budget Recommendation: Option #1

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Non-Admin 3000-6000: Support QRIS Activities

Value: $4.0M QRIS raises the standard of care and must therefore be supported with its own annual appropriation.

3000-6000: Increase Funding for Professional Development Value: $500K The FY11 statewide implementation of a professional development network once implemented is expected to have a demand which exceeds current funding.

3000-6075: Return Mental Health to FY10 Funding Level Value: $250,000 (Increases appropriation to $1M) Reduction in funding cut services and emphasis on supporting crisis assistance for children in need of services. More children with mental health issues are being served in child care.

FY2012 EEC Budget Request: Option #2

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Descriptor Line Item FY10 FY11 FY12 Budget

Request

Difference between FY11 and FY12 Maintenance -

EEC Request Notes

*Administration 3000-1000 $ 11,622,212 $ 11,417,421 $ 12,101,394 $ 683,973

Maintenance increase plus ONLY six (not 11) additional positions

Access Management 3000-2000 $ 6,358,771 $ 5,933,862 $ 6,083,862 $ 150,000

Waitlist system annualized cost

Supportive 3000-3050 $ 77,836,888 $ 85,713,529 $ 92,767,534 $ 7,054,005 8.234% growth TANF Related Child Care 3000-4050 $ 116,232,279 $ 127,358,313 $ 136,244,249 $ 8,885,936

FY11 expenditure level plus 3% growth

Low Income Eligible Child Care 3000-4060 $ 260,954,672 $ 233,527,605 $ 234,929,254 $ 1,401,649

Maintains present caseload of 30,000 children.

Grants to Head Start 3000-5000 $ 8,000,000 $ 7,500,000 $ 7,500,000 $ -

UPK 3000-5075 $ 8,000,000 $ 7,500,000 $ 7,500,000 $ -

Quality Supports 3000-6000 $ 14,032,568 $ 14,011,633 $ 18,011,633 $ 4,000,000 Increase Quality Account by $4M to support QRIS.

Mental Health 3000-6075 $ 1,000,000 $ 750,000 $ 750,000 $ -

Family Supports and Engagement 3000-7050 $ 5,000,000 $ 5,000,000 $ 5,000,000 $ -

509,037,390$ 498,712,363$ 520,887,926$ $ 22,175,563

**FY11 Admin account includes pending Reserve Draw of $111K for the FY11 CBA increases.**FY11 Income Eligible account includes $5M PAC recently passed by the Legislature.

FY12 EEC Budget Recommendation: Option #2

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Budget Option #2 – Reduced Request. In recognition of the economic environment, EEC would reduce its budget request by amending the following:

Admin: Staffing Request Value: $379,114 Instead of 11 positions, EEC would further its request to the following six essential positions:

1. Fiscal Monitors: 2 positions ($118,584)2. Director of Community Partnership and Outreach: ($75,000)3. Child Care Licensing Specialist: 2 positions ($100,530)4. Chief Operations Officer: ($85,000)

Overall admin increase would be $683,973 ($304k for maintenance and $379K for 6 additional positions)

Not include the increase to Mental Health (thus keeping it at FY11 levels).Remove the $500K Professional Development increase.

FY2012 Potential Impacts The Good, the Bad, and the Ugly

The Good: Potential increase in CCDF funding. The FFY2011 federal CCDF grant award may increase by $9M in discretionary and $15M in Matching funding. This increase, particularly in the discretionary award (since it does not need to be matched) could create an opportunity for additional funding from the Legislature in FY12.

The Bad: “Based on modeling done by A&F, it is clear that we will again have a gap between projected revenues and spending and therefore will not be able to afford maintenance levels of funding in FY12 and FY13.” This quote is from ANF and is the reality of the times we are navigating. FY12 spending caps will reflect this reality for most agencies. Governor Patrick and his administration have been extremely generous with the education budgets, but even this generosity is bound by the economic climate.

And the Ugly: Ballot Question 3 would reduce the Sales Tax rate in Massachusetts from 6.25% to 3%. This would eliminate $2.5B in annual state revenue. This, in addition to an already existing $2B structural deficit that needs to be remedied in FY2012, would have catastrophic impact on state government spending including EEC.

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FY2012 – Summary of Budget Options

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Descriptor Line Item FY11 FY12

Maintenance % diff Option 1 % diff Option 2 % Diff

*Administration 3000-1000 $ 11,417,421 $ 11,722,280 2.67% $12,372,785 8.37% $12,101,394 5.99%Access Management 3000-2000 $ 5,933,862 $ 6,083,862 2.53% $6,083,862 2.53% $6,083,862 2.53%

Supportive 3000-3050 $ 85,713,529 $ 92,767,534 8.23% $92,767,534 8.23% $92,767,534 8.23%TANF Related Child Care 3000-4050 $ 127,358,313 $ 136,244,249 6.98% $136,244,249 6.98% $136,244,249 6.98%

**Low Income Eligible Child Care 3000-4060 $ 233,527,605 $ 234,929,254 0.60% $234,929,254 0.60% $234,929,254 0.60%Grants to Head Start 3000-5000 $ 7,500,000 $ 7,500,000 0.00% $7,500,000 0.00% $7,500,000 0.00%

UPK 3000-5075 $ 7,500,000 $ 7,500,000 0.00% $7,500,000 0.00% $7,500,000 0.00%

Quality Supports 3000-6000 $ 14,011,633 $ 14,011,633 0.00% $18,511,633 32.12% $18,011,633 28.55%

Mental Health 3000-6075 $ 750,000 $ 750,000 0.00% $1,000,000 33.33% $750,000 0.00%

Family Supports and Engagement 3000-7050 $ 5,000,000 $ 5,000,000 0.00% $5,000,000 0.00% $5,000,000 0.00%

498,712,363$ 516,508,812$ 3.57% $521,909,317 4.65% $520,887,926 4.45%

*FY11 Admin account includes pending Reserve Draw of $111K for the FY11 CBA increases.**FYII Income Eligible account includes $5M PAC recently passed by the Legislature.