Proposed State Budget Cuts

While we have a really long way to go in the budget process this year, the discussion of what to cut has begun.  Governor Perdue recently asked all state government departments to provide her with budget scenarios that include 5%, 10% and 15% cuts.  Budget documents are available on the TogetherNC website.  Below are some highlights.

Health and Human Services (HHS)

HHS proposed cuts of approximately $246 million, $402 million and $730 million from its $4.9 billion budget.  Please note that the proposed cuts I reviewed did not include any proposals to cut funding to the Division of Medical Assistance (DMA).  As DMA oversees all Medicaid funded services, this is a very big open question.

$135 million in proposed cuts to the Divisions of MH/DD/SAS and State Operated Healthcare Facilities which includes:

• $20+ million/$24+ million/$41+ million reductions to services provided statewide through contracts with LMEs, including reductions in LME Cross Area Service Program (CASP) funds.  The reduction was calculated on a pro rata basis excluding crisis services funding.
• $1.7 million reduction to LMEs for system management.
• $20 million/$26 million reduction to LME Systems Management - counties would pay a portion of the non-federal share in varying amounts depending on the size of the LME, with the percentage decreasing as LMEs become larger ending at 15%.  The purpose is to incentivize counties and LMEs to achieve economies of scale and participate in the 1915(b)/(c) managed care waivers.  The state does not pay separate LME Systems Management fees to LMEs participating in the waiver because administrative costs are paid as a percentage of the service funds.
• $523,638 reduction to LMEs to fund School Based Child and Family Teams.  This proposal does not eliminate the Child and Family Teams altogether, but eliminates additional funding to 12 LMEs to place school nurses and social workers in low-wealth schools. (DSS has a companion proposal to eliminate the LME funding).

$9 million in proposed cuts to the Division of Aging and Adult Services which includes:

• A reduction of $2 million to eliminate the the State Adult Protective Services (APS) Fund, which pays for APS social workers in 52 county departments of social services to carry out their duties, including evaluating reports of alleged abuse, neglect and exploitation of adults with disabilities.
• $875,000 reduction to eliminate the State Adult Care Home Specialist Fund which funds the state share (25%) for these specialists who help assure that adult care homes meet state licensing standards and provide care to meet the residents' needs.   
• $500,000/$2.4 million reduction to non-Medicaid community based services, including in-home personal care, in-home respite care, home delivered meals, and medical transportation.

$7.6 million in proposed cuts to the Division of Central Management and Support

$67 million in proposed cuts to the Division of Child Development which includes:

• $9.4 million/18.8 million/28.2 million reduction to Smart Start.
• $1.3 million reduction to More at Four.

$846,322 and $1.8 million in proposed cuts to the Division of Health Service Regulation which includes:

• Eliminating 21 vacant positions ($846,322).

$31 million in proposed cuts to the Division of Public Health which includes:

• $9 million/11 million/1.2 million reduction to School Health Services to eliminate School Nurse positions.

$11 million in proposed cuts to the Division of Social Services

$8 million in proposed cuts to the Division of Rehabilitation Services which includes:

• $2 million reduction to funding for basic support case services that assist individuals in obtaining and retaining employment.
• $284,502 reduction to eliminate the remaining recreational therapist positions within Independent Living Services.
• $1.7/3.9 million million reduction to aid and public assistance through Independent Living Services , which prevents institutionalization and assists with deinstitutionalization.

$2.5 million in proposed cuts to the Division of Services for the Blind, Deaf, and Hard of Hearing which includes:

• $1.3 million/419,456/838,911 reductions to case service funds in the Medical Eye Care Program.

Department of Public Instruction (DPI)

DPI proposed cuts of 5% and 10%, amounting to $396 million and $793 million in reductions, which include:

• The elimination of 69,524.5 classroom teachers ($239 million/292 million proposed reductions).
• $24 million/29 million reduction to Children with Special Needs (a 3.4%/4.2% reduction) - there is no detail, so we don't know if this is a per pupil reduction or reduction of particular programs.  There have been reductions in the past two years that were due to a declining number of children with special needs.
• $202 million/394 million reduction for Teacher Assistants (a 38% and 75% proposed reduction!).
• $4 million reduction to More at Four.
• 5 and 10% reductions to the Residential Schools ($1.6 million/3.3 million).

Department of Juvenile Justice and Delinquency Prevention (DJJDP)

DJJDP proposed cuts of $2.4 million which include:

• $1.3 million reduction in Clinical Services, including eliminating up to 3 Psychological Program Managers, a 10% and 15% reduction in psychological services contracts, and the closing of Camp Woodson.
• $265,447 reduction in Community Services, including elimination of funding to Project Challenge and the Juvenile Assessment Center, and reduction of the Community Services motor fleet/travel budget.
• $419,502 reduction for Education Services which will eliminate 6 educator positions.
• $265,428 reduction in Juvenile Court Services.
• $137,989 in Youth Development

Department of Corrections (DOC)

DOC proposed cuts of $19 million and $28 million which include:

• $2 million/2.1 million reductions to the Administrative Division, including the elimination of funding for Harriett's House, Our Children's Place, Summit House and Women at Risk.
• $4.4 million/5.2 million reductions to the Division of Alcoholism and Chemical Dependency Programs, which will eliminate Evergreen Substance Abuse Treatment Services and Mary Frances Substance Abuse Treatment Services.
• $600,943/776,258 reduction to the Division of Community Corrections.
• $12 million/20 million reductions to the Division of Prisons, including closing Haywood Correctional.

Again, this is just the beginning and we have a very long road to go with the budget, but this gives an indication of where the departments think the cuts should be made.