LEGISLATURE APPROVES EMERGENCY BUDGET ACTIONS INCLUDING OVER $1.4 BILLION IN CUTS - PACKAGE OF BILLS HEAD TO GOVERNOR FOR APPROVAL

Approves 10% Medi-Cal Rate Reduction July 1 - Continues Regional Center Cost Containments -  Approves Suspension of Cost of Living for SSP & CalWORKS Until October 2008 - No Action Until Regular Budget Process on IHSS, Adult Protective Services, Foster Care and Adoption Assistance Programs, Supported Employment Program

 

SACRAMENTO  (CDCAN)  - Both houses of the Legislature this morning (February 15) gave final approval to a package of bills that okays some but not all of the Governor's proposed emergency budget cuts, that include a 10% rate reduction to most Medi-Cal providers, including adult day health centers, effective July 1, 2008, permanent continuation of existing regional center "cost containment" measures including expansion of a share of cost program for families, and suspension of the state funded cost of living increases due June 1, 2008 for SSI/SSP for five months until October 1, 2008.  Cost of living increases due to CalWORKS recipients on July 1 was also suspended until October 1, 2008.  [See separate CDCAN Report for details on the cuts as approved by both houses. CDCAN will also be holding a series of townhall telemeetings on the budget]. 

 

The Assembly took action first on the package of bills and then adjourned, with the State Senate then approving those bills and adjourning just before 12 noon today. 

 

The overall impact of the passage of the emergency budget actions and cuts, according to leaders in both houses is to reduce overall projected $14.5 billion shortfall projected by the end of the 2008-2009 State Budget year to about $7 billion.  The package of bills, according to legislative leaders from both parties, will also eliminate the $3 billion shortfall in the current 2007-2008 State budget year that ends June 30, 2008 and create a $1 billion reserve.  However those savings and figures could change by May depending on the State's economy and revenues coming in by then.  In addition, the task of closing even a $7 billion deficit is daunting - with all of the Governor's proposals for sweepings cuts that the Legislature did not act on yet, still on the table. 

* Both houses approved the 10% rate reduction to most Medi-Cal providers as proposed by the Governor, but changed the effective date to July 1, 2008 instead of June 1, 2008 . The cut  will mean a reduction to the Medi-Cal program in the 2008-2009 State Budget of over $540 million.   

* Neither house took action on the proposed elimination of some Medi-Cal optional benefits. 

 

Regional Center $329 Million Cost Containment Made Permanent

* Both houses approved to  continue on a permanent basis, the regional center cost containment measures that will cut over $329 million (including federal funds) from the regional center budget for the 2008-2009 State Budget year.

* Approved to continue on a permanent basis other regional center cost containment measures impacting operations.

* Approved to continue on a permanent basis the current family cost participation program (sometimes referred to as family share of cost or parental co-payments) that was due to end June 30, 2009, and also approved expansion of the program to include, for those families whose income exceed a certain level, children under the Early Intervention Program.

* Neither house took action yet on the Governor's proposed 10% rate reduction to the supported employment program.

 

Suspends CalWORKS and State Portion of SSI/SSP Grants to October 1, 2008

* Both houses also approved suspending or delaying the cost of living ]increases for the SSP portion of the SSI/SSP grants to the lowest income people with disabilities, seniors and the blind, due June 1, 2008 to October 1, 2008, which is different from the Governor's proposal that called for a full year cut or suspension of the cost of living increase due June 1, 2008 for the state portion (SSP) of the SSI/SSP grants. 

* It took no action yet on the Governor's proposal to suspend or cut the cost of living increase for the state portion (SSP) due June 1, 2009. 

* Both houses also approved a delay in cost of living increases due to CalWORKs recipients on July 1, 2008 to October 1, 2008, which the Governor did not propose in his January 10 proposed State Budget.

 

No Action Yet on IHSS, SSI/SSP COLA for 2009, Foster Care, Adoption Assistance

Neither house actually rejected any of the Governor's proposals - but held off taking action on several other major proposed cuts that they will further review and take final action later during the regular budget process that begins with budget subcommittee hearings in March through early May:

* In-Home Supportive Services (IHSS) - held off taking action until the regular budget hearings that will be held from March through early May, on the Governor's proposed 18% reduction in the non-medical, domestic and related hours for persons receiving IHSS, and also 10% reduction  to the counties in the administration of IHSS 

* Medi-Cal optional benefits - held off taking action until the regular budget hearings in March through May, on the Governor's proposal to eliminate some of the Medi-Cal optional benefits

* Adult Protective Services - held off taking action until the regular budget hearings that will be held from March through early May on the Governor's proposed cuts to this program

* Foster Care and Adoption Assistance Programs - held off taking action until the regular budget hearings that will be held from March through earfly May on the Governor's proposed cuts, including a 10% rate reduction to these programs. 

* Supported Employment Program - held off taking action until the regular budget hearings that will be held from March through early May on the Governor's proposed 10% rate reduction to this program

* Education Funding - held off taking action on the Governor's proposal to suspend the State Constitution provision(referred to as Proposition 98) that guarantees a certain level

 

Bills Passed By Both Houses Going to Governor For Approval

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