Department of Human Services FY 2012 FY 2011 Amended Budget Considerations

DHS FY 2012 Budget Discussion Where we are How we got here Where we are going

Budget Cycle Current Focus Closing FY 2010 Budget Final allotment cut $894,929 state funds (last two weeks) Starting FY 2011 Budget Year Budgets loaded into system Operations beginning at reduced levels Preparing FY 2012 and FY 2011 Amended budget request Due Sept 1 No budget instructions from OPB to-date, but expect prior cuts to be rolled into FY 2012

DHS Budget History State Funds FY 2010 Original Budget $509,461,256 FY 2010 Reductions 7% (35,885,863) FY 2010 Amended $473,575,393 FY 2011 –Statewide Adjustments 6,233,243 –Additional Reductions (3,860,567) FY 2011 Original Budget $475,948,069

FY 2012 Focus Maintain current funding level Additional cuts could seriously impact core services

Budget Prioritizations to make cuts in FY2010 Amended and FY2011 Must Do –Services required by Statute, rule, regulation, grant or contractual obligation –Consent Decrees Should Do –Service beyond minimum requirements of Must do – Social obligations –Strategic initiatives to achieve DHS organizational goals –Legislative intent Nice to Do –Other initiatives supporting DHS mission and social obligations

Actions Taken Cut Travel not related to client services or required for core business functions Restricted office supplies Renegotiated contracts for better rates Reduced contracts for services Reduced Office Space Shift to on-line and in-house training Eliminated Nice to Do and Should Do Services Employee Furloughs and restricted hiring Eliminated Employee annual salary increases

Funding issues FY 2011 impacting FY 2012 request State funding required for TANF maintenance of effort (MOE) is at minimum level –Relying on external sources Aging MOE is near minimum level TANF program funding has been maximized wherever possible (no more reserves) Child Support at minimum state participation level

TANF MOE Estimates DHS Program –After School $28,000,000 –Child Support 3,216,117 –Child Welfare 48,259,890 –Child Care 22,182,651 –Family Violence 4,483,171 –Out of Home Care 24,239,774 –SNF – Work 3,577,658 –Total DHS Programs$133,959,231 External Sources – Current Estimate –OFC School Readiness Pre-K DECAL $5,716,231 –OFC School Readiness Pre-K Trans. 753,622 –DTAE-Technical Education 1,024,125 –DTAE-Hope Scholars 149,640 –Atlanta Food Bank 24,100,000 –MOE from CCI Donations 7,000,000 –Total External Sources$38,744,425 Total Estimated MOE$172,703,656 Required TANF MOE 173,368,527 Difference to be identified$ (664,871)

Child Support Required Participation

Need to Maintain Performance Federal and court ordered - required performance standards –Child Welfare CFSR Safety, Permanency, Well-being CFSR PIP - 9 negotiated indicators with financial penalty if not met Kenny A Consent Decree –Eligibility Programs Food Stamp error rate Medicaid, food stamp, child care and TANF eligibility application timeliness TANF work participation rate –Elderly protection –Child Support

FY 2012 Need to Maintain Current Funding Down to core business functions - Must Do’s (no discretionary funding left) Additional cuts could impact federal participation (MOE and match) – Risk: Lose more than would be saved – Risk: Lose whole program funding in Aging Reduced staffing could result in financial penalties related to performance Impact to clients

Potential Funding Deficit Child Support Services loss of ARRA funding will need to be replaced Food Stamp Administration loss of one time federal support Statewide loss of ARRA FMAP Rate must be addressed (statewide issue)

Business Case Example Federal Eligibility Program Eligibility Program Funding –Food Stamps - 50% state 50% federal –Medicaid - 50% state 50% federal –TANF - 100% federal Service level change –Food Stamp eligibility increased with no new state funds –Medicaid eligibility increased with no new state funds –TANF Clients eligibility stable – Workload shift = shift in funding mix of state and federal funds Results - $14 million deficit in state funds for eligibility programs (FY 2011). –Funded with one time federal supplemental and incentive funds If trend continues in FY 2011 and 2012 state funding is inadequate.