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DHS BUDGET PRESENTATION

TO MICHIGAN CHILD CARE

TASK FORCE

March 3, 2010Jennifer M. Granholm, GovernorIsmael Ahmed, DHS DirectorJane Schultz, DHS Budget Division Director

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MISSION

The Department of Human Services provides services to vulnerable children, adults and families.

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HIGHLIGHTS

• State budget process• Child Development and Care (CDC)

appropriations• Funding sources and how their use is

determined

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STATE BUDGET PROCESS • Governor is required to propose a

balanced budget (Article V, section 18).

• State Budget Office (SBO) provides guidelines/direction to departments.

• Departments provide their requests to SBO.

• Governor makes decisions and presents budget to legislature.

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LEGISLATIVE ACTION

• Bills are introduced in both houses and divided for consideration.• Bills are assigned to appropriations

subcommittees.• Hearings are held to discuss issues/

budget changes from current year.

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LEGISLATIVE ACTION, CONT’D

• Subcommittee writes bill.• Full committee considers bill.• Full chamber considers bill.• Conference committee works out

differences.• Passed, ordered enrolled, and signed by Governor (vetoes).

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BUDGET REVISIONS AND CLOSING THE BOOKS

• Budget revisions– Executive Order reductions– Supplemental appropriations– Transfers

• The books close after the end of the fiscal year.

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FY 2010 SUPPLEMENTAL HIGHLIGHTS

• $266.3 million for $1LIHEAP implementation/FAP benefits

• $123.1 million for caseload adjustments• $13 million to restore JET Plus• $7.7 million for 197 additional field staff• $3 million for family preservation

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FY 2011 PROPOSED BUDGET

GF/GP: $959 million All Funds: $7 billion

Miscellaneous covers Community Improvement, Child Support Enforcement, Disability Determination Services, Adult & Family Services, Administration and Information Technology.

Income Assistance65%

Field Operations13%

Children's Services11%

Miscellaneous11%

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FY 2011 PROPOSED BUDGET

BY FUNDING SOURCE

Federal Regular73.3%

Federal ARRA11.4%

General Fund13.7%

Other1.6%

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FY 2011 PROPOSED BUDGET

INCOME ASSISTANCE ONLY

LIHEAP2.6%

Child Devel and Care4.9%

FAP79.2%

Other3.6%

FIP9.7%

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CHILD DEVELOPMENT AND CARE

• Financial assistance for CDC to qualifying families with the goal to promote safe, affordable, accessible, quality child care

• Categorical eligibility (no co-pay) for family groups receiving FIP assistance, foster care families, and families with protective service cases – approximately 41%

• Income eligibility (5% - 30% co-pay), i.e., for monthly income below $1,990 for family of 3.

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CHILD DEVELOPMENT AND CARE

PROVIDER TYPESProvider Type Number %

Child Care Center 1,904 7.8%

Group Home 1,780 7.3%

Family Home 1,949 8.0%

Relative 11,271 46.0%

Aide 7,552 30.8%

License-Exempt 24 0.1%

Total 24,480 100.0%

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CHILD DEVELOPMENT AND CARE

SPENDING AND CASELOAD TRENDS

$478,500 $460,200 $433,900 $389,200 $316,600 $238,800 $223,000

33,000

36,000

43,313

50,392

54,417

58,840

60,680

$0

$50,000

$100,000

$150,000

$200,000

$250,000

$300,000

$350,000

$400,000

$450,000

$500,000

FY 05 FY 06 FY 07 FY 08 FY 09 FY 10 est FY 11 est

0

10,000

20,000

30,000

40,000

50,000

60,000

Series2

Series1

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CHILD DEVELOPMENT AND CARE• Auditor General program audit issued

July 2008 found Improper payments• Implementation of controls

– Provider time and attendance record review

– Review of high risk cases– Payment and billing verification improvements

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CHILD DEVELOPMENT AND CAREFY 2009 DEPARTMENT MAXIMUM HOURLY RATES

  Child Care Center Family and Group Homes Relatives Aides

SHLTR AREA

CHILD'S AGE CHILD'S AGE CHILD'S AGE

ALL AGES0-2½ Yr 2½ Yr + 0-2½ Yr 2½ Yr + 0-2½ Yr 2½ Yr +

I $2.60 $1.97 $2.38 $2.08 $1.95 $1.95 $1.40

II $3.11 $2.33 $2.28 $2.08 $1.95 $1.95 $1.40

III $2.75 $2.08 $2.44 $2.08 $1.95 $1.95 $1.40

IV $3.48 $2.33 $2.38 $2.08 $1.95 $1.95 $1.66

V $3.53 $2.33 $2.75 $2.18 $2.20 $2.04 $1.66

VI $3.95 $2.60 $3.11 $2.60 $2.44 $2.44 $1.66

RESTRUCTURED FY 2010 DEPARTMENT HOURLY RATES – 2009 PA 129 Sec. 675

Child Care Center Family and Group Homes Aides/Relatives- Tier 1 Aides/Relatives- Tier 2

CHILD'S AGE CHILD'S AGE CHILD'S AGE CHILD'S AGE

0-2½ Yr 2½ Yr + 0-2½ Yr 2½ Yr + 0-2½ Yr 2½ Yr + 0-2½ Yr 2½ Yr +

$3.75 $2.50 $2.90 $2.40 $1.85 $1.60 $2.20 $1.85

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CHILD DEVELOPMENT AND CARE

FUNDING SOURCES• Temporary Assistance to Needy

Families (TANF)• Child Care Development Fund (CCDF)• CCDF ARRA• Other federal funds• State General Fund

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CHILD DEVELOPMENT AND CARE

FY 2010 FUNDING

• Regulated Day Care (in millions)– $127.2 Total– $19.7 General Fund– $107.5 Federal

• $26.9 TANF• $58.8 CCDF• $11.2 CCDF ARRA• $10.6 Other Federal

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CHILD DEVELOPMENT AND CARE

FY 2010 FUNDING

• Unregulated Day Care (in millions)– $111.6 Total – $16.2 General Fund– $95.4 Federal

• $23.8 TANF• $51.7 CCDF• $9.9 CCDF ARRA• $10.0 Other Federal

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TANF

The federal TANF Program is designed to help needy families achieve self-sufficiency by providing assistance and work opportunities to needy families through a block grant to states, giving them wide flexibility to develop and implement their own welfare programs. States may use TANF funding in any manner "reasonably calculated to accomplish the purposes of TANF."

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TANF CONT’D

TANF purposes are: – assisting needy families so that children

can be cared for in their own homes. – reducing the dependency of needy

parents by promoting job preparation, work and marriage.

– preventing out-of-wedlock pregnancies. – encouraging the formation and

maintenance of two-parent families.

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CCDF The federal CCDF is the primary

program devoted to child care services and quality. It enables low-income parents and TANF parents to work or be in education and training programs needed to work. Approximately $16 million of the funds must be used to enhance child care quality and availability.

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STATE GENERAL FUND

The state’s General Fund is used for

the ordinary operations of the state. It may be used to fund any activity.

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QUESTIONS?

Jane Schultz

Budget Division Director

Department of Human Services

517-241-2453

schultzj@michigan.gov