Governor Newsom’s 2020-21 January Budget Proposal

Thursday, January 10th, 2020, Governor Newsom released his 2020-21 budget blueprint. The budget projects continued surplus revenue for 2020-21, but less of surplus than last year. In this Budget, as with last year’s, the majority of the surplus is devoted to one-time spending. Overall the Governor proposed a 2.3% total increase in state spending. Below is a summary of the governor’s proposed budget and its impact on Californians with intellectual and developmental disabilities and their families:

*note: budget amounts are shown in Total Fund amounts, which equals state’s portion (GF or General Fund) plus the federal government’s portion. Some amounts also show just the GF (General Fund) amount for comparison.

Regional Center Services

The proposed budget estimates regional center caseload growth from 333,000 clients in 2019, to 350,00 clients in 2020, and 368,000 clients in 2021. The Governor’s Budget proposes $8.75 billion ($5.3 billion GF) for the Regional Center system, an increase of $952 million ($613 million GF) as compared to the updated current year budget. The increase is mainly a result of caseload adjustments and increases to minimum wage.

  • On Friday the Department of Developmental Services released their updated rate models to conclude the DDS Rate Study. Also released were the summary of public comments in regard to the draft rate models. More analysis of the rate models will be forthcoming; however, the finalized rate models continue to demonstrate that services for Californians with IDD are underfunded by nearly $2 billion.
  • The Budget proposal includes $18 million ($10.8 million General Fund) in 2020-21 and $35.9 million ($21.6 million General Fund) in 2021-22 to provide supplemental rate increases for Early Start Specialized Therapeutic Services, Infant Development and Independent Living services, consistent with the supplemental rate increases included in the 2019 Budget Act. These services did not receive the 8.2% rate increase that was passed in last year’s budget. The reasoning for their omission was that the draft rate studies indicated that those services should actually get a decrease. Those conclusions in the draft rate models were later admitted by the contractor of the study to be based on bad data inputs. This budget investment aims to correct that mistake. Unfortunately, however, the Governor’s proposes to wait until January 1, 2021 to correct the mistake, which would be a full year after those services should have received the increase.
  • The Budget proposes to delay the suspension date of provider rate increases from December 31, 2021 to July, 2023.
  • The Governor proposed an increase of $78.0 million ($60.0 million GF) to establish a Performance Incentive Program for Developmental Services administered through Regional Centers. The Performance Incentive Program would align with each Regional Center’s performance contract and require Regional Centers to meet an advanced tier of performance measures. (It is unclear at this time if these funds would be tied to the rate models as finalized in the DDS rate study, and/or if these funds are proposed to fund regional centers or service providers.)
  • Enhanced Caseload Ratios for Young Children—The Budget proposal includes $16.5 million ($11.2 million General Fund) to establish a reduced regional center service coordinator caseload ratio for consumers who are under the age of five years.
  • Systemic, Therapeutic, Assessment, Resources and Treatment Training—The Budget proposal includes $4.5 million ($2.6 million General Fund) to provide training on person-centered, trauma-informed, and evidence-based support services for individuals with co-occurring developmental disabilities and mental health needs.
  • Warm Shutdown of Fairview Developmental Center—The Budget proposal includes $11.9 million General Fund to extend the warm shutdown period at Fairview Developmental Center through 2020-21 until a site assessment is completed to inform the disposition of the property.
  • Community Crisis Homes for Children – Decrease of $4.5 million GF in onetime start-up funding.
  • Development of STAR Homes – Decrease of $3.0 million GF in one-time startup funding to develop two STAR homes in Central CA.
  • Enhanced Behavioral Supports Homes (EBSH) with Delayed Egress and Secured Perimeter (DESP) – Increase of $7.5 million GF to develop five EBSHs with DESP to reduce reliance on restrictive settings and provide opportunities for individuals to move to the community, with appropriate and necessary supports
  • Systemic, Therapeutic, Assessment, Resources and Treatment (START) Training – Increase of $4.5 million ($2.6 million GF) to support individuals in their current residential arrangement and prevent disruptions and admissions into more restrictive settings, such as Institutions for Mental Diseases, out-of-state services, acute psychiatric settings, Community Crisis Homes and STAR services through the provision of 24-hour crisis services and planning, and by providing training to families, direct support staff, and local partners (e.g., police, hospital staff, teachers) on person-centered, trauma-informed, and evidence based support services for individuals with co-occurring developmental disabilities and mental health needs.
Developmental Centers

In 2015, the state announced the planned closure of the three remaining developmental centers: Sonoma, Fairview, and the general treatment area of Porterville. The last residents at Fairview and the Porterville general treatment area are transitioning to the community in January 2020. The Department will continue operating the secure treatment program at Porterville, the Canyon Springs community facility, and state-operated acute crisis facilities in Northern, Central, and Southern California, with an estimated population of 322 by June 30, 2021.

State-Operated Facilities

Persons with intellectual and developmental disabilities who are deemed incompetent to stand trial (IST) often languish in county jails while awaiting a more appropriate placement. We are pleased that Governor Newsom has invested $8.9 million general fund dollars for the temporary activation of a 20-bed unit in the Porterville secure treatment program to help reduce the number of individuals awaiting placement. The Governor proposed budget includes:

  • $8.9 million General Fund for State-Operated Facilities to temporarily activate a 20-bed unit in the Porterville secured treatment program for individuals with IDD who are deemed incompetent to stand trial (IST). The additional unit will sunset June 30, 2024, are more integrated community setting are developed.
  • $7.5 million General Fund for Community Services to develop 5 enhanced behavioral support homes with secure perimeters aimed at providing long-term placement for individuals who are deemed IST.
  • $24.6 million General Fund to implement a Community Care Collaborative Pilot Program, a 6-year pilot in 3 counties, to provide incentives to treat and serve individuals deemed IST.
  • $8.9 million General Fund ($11.2 million General Fund thereafter) to expand Jail-Based Competency Treatment programs in 8 additional counties.
  • Department of Youth and Community Restoration $289.7 million ($260.8 million GF) 2020-21 and $295.6 million ($266.8 million GF) annually thereafter to establish the Division of Juvenile Justice as a new Department of Youth and Community Restoration. $2 million for an Interagency Agreement between Department of Youth and Community Restoration and California Volunteers for navigators.
Special Education

In his presentation the Governor stated that special education in California is in crisis and it’s a real shame.” The Governor cited his own benefits from special education as a child. As a result the Governor proposes significant investments and made mention of “leaning into” SELPAs. The proposed budget included $900 million for each workforce development, and the Budget proposes an additional $250 million ongoing Proposition 98 General Fund based on the number of children ages 3 to 5 years with exceptional needs served.

SSI/SSP

Effective January 2020, the maximum SSI/SSP grant levels are $943 per month for individuals and $1,583 per month for couples. The projected growth in the Consumer Price Index is 1.7 percent for 2021. As a result, the maximum SSI/SSP monthly grant levels will increase by approximately $13 and $20 for individuals and couples, respectively, effective January 2021. CAPI benefits are equivalent to SSI/SSP benefits. The 2019 Budget Act included $25 million General Fund ongoing to assist homeless, disabled individuals applying for SSI/SSP benefits.

IHSS

The Budget includes $14.9 billion ($5.2 billion General Fund) for the IHSS program in 2020-21, a 16-percent increase in General Fund costs over the revised 2019-20 level. Average monthly caseload in this program is estimated to be 586,000 recipients in 2020-21, a 4.5-percent increase from the revised 2019-20 projection. Other Significant Adjustments: • Minimum Wage—The Budget reflects $1.1 billion ($523.8 million General Fund) to support planned minimum wage increases of $13 per hour on January 1, 2020 and $14 per hour on January 1, 2021.

Electronic Visit Verification—Federal law requires states to implement an electronic visit verification system for personal care services by January 1, 2020, and for home health care services by January 1, 2023. Failure to comply with the electronic visit verification requirement would result in an escalating fiscal penalty in the form of a percentage point reduction in federal matching funds. To comply with federal law, the Budget includes $34.9 million ($5.3 million General Fund) to implement an electronic visit verification solution and enhancements to the Case Management, Information and Payrolling System for personal care services.

Homelessness

California Access to Housing and Services Fund—The Budget provides $750 million one-time General Fund to establish a new fund, with the goal of reducing street-based homelessness and increasing the number of stable housing units.

NEW Department of Early Childhood Development

The Budget proposes to establish the Department of Early Childhood Development under the Agency to promote a high-quality, affordable, and unified early childhood system that improves program integration and coordination.

Healthcare

The budget proposes to launch a Medi-Cal Healthier California for All initiative (formerly known as CalAIM, or the California Advancing and Innovating Medi-Cal initiative), which builds upon waiver demonstration programs such as Whole Person Care, the Coordinated Care Initiative, Health Homes, and public hospital system delivery transformation. Medi-Cal Healthier California for All proposes to provide a wider array of services and supports for patients with complex and high needs. Medi-Cal Healthier California for All has three primary goals:

  • Identify and manage member risk and need through whole person care approaches and addressing social determinants of health;
  • Move Medi-Cal to a more consistent and seamless system by reducing complexity and increasing flexibility; and
  • Improve quality outcomes and drive delivery system transformation through value-based initiatives, modernization of systems, and payment reform.

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