Covenant Membership News

Originally Submitted by Rob Thompson, Executive Director of the Covenant with North Carolina's Children

HHS Budget Report

At today's HHS Appropriations meeting, the Department provided legislators with a list of potential cuts to meet anticipated spending reduction requirements. To be clear, the cuts in this list are brutal and represent a large-scale retreat from the investments that we have made in our children and families.

The Department presented three different scenarios - one would cut $144 million, the next $150 million, and the last $154 million. These three numbers are supposed to represent 3%, 5%, and 7% reduction scenarios, but the dollar amounts don't align with those percentages.

In fact, the HHS sub-committee has been instructed to cut 5%, which equals $216 million. This means that an additional $60 million in HHS cuts will be necessary on top of what was presented today.

Below, I've pulled out some key proposed cuts from the presentation today.You can also follow this link to see the entire cut list. If you have concerns about any of your specific programs, please let me know.

Division of Central Administration

Housing Finance Assistance Program - this program provides housing to people with extremely low-incomes who have disabilities. $561,000 non-recurring cut.
Community Health Grants - this cut means that community health centers entering the third year of their contract will not automatically get that money, but will have to submit another grant. In simpler terms, HHS is proposing to eliminate the third year of current contracts. $300,000 recurring cut.

Division of Child Development

Child Care Subsidy - I'm not sure how this one works; seems like the state is robbing Peter (the counties) to pay Paul, but here is what the Department says. DCD would reduce county services support allocations from 5% to 4%; funds from this reduction would free up about $3.277 million in state appropriations from the subsidy services budget. An additional $1.125 million of actual cuts would be implemented to realize the full reduction amount of $4.4 million. In all, the Department projects that 249 fewer slots would be available.
Smart Start - This one is simple. Reduce the Smart Start allocation by either 3%, 5%, or 7%. The corresponding money amount for each of those scenarios is $5.8 million, $9.7 million, and $13.5 million.

Office of Education Services

Reduce Residential Services by One Night / Week - this would reduce the number of nights a week that a student could stay at the school from four to five. This has already been happening during the current fiscal year due to the Gov's withholding of 5% of the approved budget. $561,558 recurring cut.

Division of Public Health

NC Universal Vaccines for Children Initiative - this program would eliminate all funds for our state vaccine program and replace them a "Childhood Immunization Account" that would be supposedly funded by private insurance providers. I don't believe the insurance industry has agreed to this yet. $6.4 million.

Division of Social Services

Child Support Enforcement Consolidation and Reduction - the Department is proposing the elimination of 33 positions (20 filled and 13 vacant). Reductions would also be found in operating accounts. $1.58 recurring cut.
Funding Authorization to Counties - $358,529 cut to Foster Care/Adoption IV-E; $959,998 cut to Child Protective Services-State; and, $1.072 million cut to Child Protective Services IV-E. These cuts have already been in effect during the current fiscal year following the Governor's required 5% reduction reserve for the Division (though these line item cuts are more like 16%).
Child Advocacy Centers - Eliminate all state funding for child advocacy centers. $375,000 recurring cut.
NCREACH - NCREACH is a scholarship program for children in foster care. This proposed cut would eliminate the entire state appropriation and replace it with Escheat funds. This means that the Division will probably not promote this program among foster youth. $3.168 million recurring cut.
Permanency Planning - this reduction would transfer 25% of the federal participation requirement to the counties. The problem with this is that the counties have no money, which means that they might not meet the match, which then means that federal money would not be drawn down. $682,512 recurring cut.
School-based Child and Family Teams - 12 counties currently receive state money to help fund school-based child and family team facilitators. This item would eliminate that state funding. $420,804 recurring cut. (similar cut in Division of MH/DD/SA budget below)

Division of Medical Assistance

Children under 21 were exempted from all cuts to optional Medicaid services, so I'm not going to outline them here. For a full description of the Medicaid cuts, see the attached document.

Division of Services for the Blind, Deaf, and Hard of Hearing

Merge Special Assistance for the Blind Program with Special Assistance Program. $287,807 recurring cut.

Division of MH/DD/SA

School-based Child and Family Teams - this cut takes care of the other state-funding that was removed from the Social Services budget. $438,611
Counties Pay Portion of LME Systems Management Cost - this item creates a tiered payment system, which requires counties with the smallest LMEs to pay the highest percentage of the non-federal management costs. This is a pretty heavy-handed attempt to get LMEs large enough to participate in the 1915 waiver. $10.305 million recurring cut.

Division of State Operated Healthcare Facilities

Close Whitaker School - turn Whitaker into a PRTF, which would then be Medicaid eligible. $969,233 recurring cut.
Close Wright School - $1.272 million recurring cut.