FY15 Maintenance Plan Discussion Fiscal Committee October 2, 2013

FY15 GAA Timeline October SFY15 Maintenance Submission to ANF: Due October 15, 2013 Oct- Jan House 1 Prep Late January Governor’s FY15 Proposal “House 2” is released. Early February H/SWM SFY15 Maintenance Submissions due. Feb - Mar Work with H/SWM in preparing the SFY15 budget. April HWM releases and House Engrosses its version of FY15 Budget. May SWM releases and Senate Engrosses its version of FY15 Budget. June House and Senate enact the Conference Committee recommended budget and sent to Governor. Governor can veto (must be submitted 10 days after the budget is enacted by the legislature) and legislature can override. July Once override process is complete the FY15 GAA is finalized. August All agencies must submit to ANF, through the MBA database, the SFY15 Spending Plan. The plan, which requires ANF approval, details FTEs, object class spending and realignment, and revenue projections. 2

FY15 Maintenance Plan 3 All state agencies are currently developing FY15 maintenance plans for ANF. ANF defines maintenance as “…the funding level, after minimal adjustments in specific areas, to enable a department to carry out the same level of services next year as was achieved in the current year.” Aspirational budgets are not part of this process. The process just began with ANF approving FY14 Spending Plans on September 30. Agencies need to wait for FY14 approval from ANF because FY15 maintenance plans are based on the FY14 Spending Plan. We, therefore, do not have details on the FY15 financials, but have an overall grasp on potential FY15 exposures. The following slides provide an overview of the various issues we are considering when developing the FY15 Maintenance Plan.

FY15 Maintenance - Admin Account  The following are areas that will have FY15 Maintenance increases: Payroll: 1.FY14 Additions: We requested 9 additional positions in the FY14 Spending Plan. There is more than sufficient funds in FY14 to support all positions. ANF has approved seven positions; these will be added add to the FY15 Maintenance base. 2.FY15 CBA: It is likely that EEC’s union employees (NAGE and SEIU) will have a new collective bargaining agreement. The rate and cost are not known as yet. Office Lease Space: 1.There are scheduled increases in several of EEC’s offices (Central and Taunton are examples.) Biennial Market Rate Analysis: According to CCDF regulations, EEC must conduct a biannual market rate analysis. The cost is approximately $80K.  There will be roughly $110K in anticipated FY14 Springfield relocation costs that will not be necessary in FY15. 4

FY15 Maintenance Plan – Access Management For maintenance purposes, EEC will move the $700K in additional FY14 funds to the seven CCR&Rs from to this appropriation in the FY15 Maintenance Plan. The funds supported the reconstruction of the CCR&Rs' infrastructure to help ensure the timely and effective processing of the opening of access project. In FY15, the CCR&Rs will need to maintain the new supports and it is more appropriate to fund all the CCR&R contracts from one source. Also, it is not certain that the legislature will continue funding for

FY15 Maintenance Plan - Caseload  General Presumptions in Building FY15 Caseload: 1. Consolidated Net Surplus (CNS) funds an $11.5M Rate Increase: CNS is a likely occurrence. We will assume annualizing the FY14 CNS increase to the FY15 maintenance base. 2. The rate increase negotiated by SEIU will be limited to FCC providers and will not be calculated for Center Based providers in our FY15 maintenance budget. 3. OER has asked us to build into maintenance the cost of a differentiated rate structure for SEIU.  / DCF: For the FY14 spending plan we projected serving roughly 6000 children per month. This amount allowed EEC to stay within the FY14 appropriated amount and potentially add 376 children (which is included in the 6000 total). We will base the FY15 maintenance amount on serving 6000 children per month.  / DTA: We will use the same methodology used in the FY14 spending plan. We will use the projected FY14 June child count as the FY15 base and apply FY13 month-to-month variation to project FY15 month-to-month variation. 6

FY15 Maintenance Plan - Caseload  / IE Move over the 2,300 (or more) children funded from in FY14 to this item in FY15. Build in the additional (roughly 800 children) children to whom we opened IE access as part of our backfill attrition policy into FY15. After adding the 2,300 and 800 points of access opened in FY14 to the totals we will use the projected FY14 ending child count in IE and as the base for FY15 IE maintenance plan. We will assume CCR&R will backfill any voucher slots vacated in FY15 with another child.  / Waitlist Remediation: The inclusion of another $15M for Waitlist Remediation for FY15 is maintenance in our view because: a)there was no indication from the legislature and ANF that this was a one-year project; and b)to continue is maintaining the state's policy of reducing the IE waitlist growth. We would request $14.3M because $700K would be transferred to the in FY15. 7

FY15 Maintenance Plan - Other  We will assume level funding for: / Head Start / UPK / Mental Health / Family Services / Reach Out and Read.  We could assume level funding for: / STEM Curriculum Funding: FY15 funding could be argued as maintenance as it would be continuing a project funded in FY14.  We will not assume level funding for: / Early ED Provider Quality Enhancements: We believe this is a one year deal; therefore, no maintenance funding required in FY15. 8