1. FY 2012 Budget Process Update

2. Overview: FY 12 Senate Budget On May 26, 2011 the Senate engrossed S.3, the FY2012 budget totaling $30.5B. The Senate has recommended a budget for EEC of $488M which is $13M less than the Houses recommended level of $501M. The Senates budget will cause layoffs, sustained access closure, and severe administrative restrictions (for example, payment of leases) Like the House, the Senate did not consolidate the caseload accounts but did dedicate a separate line item for the Reach Out and Read program (funding it $300K more than the House), which is currently funded from the Family Engagement line item. 2

3. Comparison of FY12 Budget Levels 3

4. Senate Budget – Amendments Filed 4 None of these amendments were adopted.

5. FY12 Budget Conference Process EEC must identify which items are conferenceable. EEC must then prioritize the conferenceable items and submit these to EOE. EOE will then review EEC priorities and compile a Secretariat wide list for submission to ANF. The EEC priorities are: Fund the admin account at the House level. Fund the IE account at the House level Fund the Quality Supports/Family Engagement accounts at the (combined) House level thus enabling EEC to fund QRIS from this account. 5

6. FY12 Budget Conference Committee Over the next month representatives from both the House and Senate Chambers will meet to resolve any differences in the House and Senate versions of the FY12 budget. After the negotiations the Conference Committee will present to both chambers for their consideration a Conference Report. The Conferees have been appointed: House: Chairman Brian Dempsey (D-Haverhill); Vice-Chairman Stephen Kulik (D-Worthington); and Representative Vinny DeMacedo (R-Plymouth) Senate: Chairman Stephen Brewer (D – Barre); Vice Chairman Steven Baddour (D-Methuen); and Senator Michael Knapik (R-Westfield). 6

7. FY12 Budget: H/SWM Comparison 3000-1000 Administrative Account Appropriation: House: $11,683,491- Support our Admin maintenance needs, which include CBA increases, step increases, and anticipated lease increases. Senate: $11,104,990 - Severe administrative restrictions and potential staff reduction of 10 personnel. Senate budget does not include funding for the CBA the legislature passed last year or anticipated lease increases. Comparison - Overall, the House recommendation of $11.68M would enable EEC to come closer to maintaining services and support collective bargaining costs and other liabilities in FY12. The Senate recommendation would force severe reductions in the department which has already seen its FTE levels drop from 178 to 161 (9.6%) since FY09. Language: House: Requires EEC to issue a report by February 15, 2012 detailing the feasibility of centralizing the following responsibilities provided through item 3000-2000 in fiscal year 2011 with the department: program coordination and support, voucher management, outreach to hard-to-reach populations, intake and eligibility services for families seeking financial assistance to enroll in early education and care programs, resource and referral for families with disabilities in child care programs, and walk-in services for homeless families. Senate: Requires EEC to provide data to the proposed Caseload Forecasting Office. Comparison - If the Senate proposed Caseload Forecasting Office in Outside Section 6 is adopted then the Senate language in our admin account would be necessary. The House report allows EEC the opportunity to explore further efficiencies in the voucher caseload management. 7

8. FY12 Budget: H/SWM Comparison 3000-2000 Access Management Appropriation: House: $5,933,862 - Funds most of the anticipated FY12 cost with the exception of the $60K needed to annualized cost to maintain COTS Waitlist system. Senate: $4,433,862 – Over a 25% reduction from the FY11 level. Comparison - A $1.5M reduction (25%) in this account impacts funding for the CCRRs. Language: The House strips most language away because it requires a report from EEC detailing EECs ability to take over many of the current CCR&R functions. The Senate recommends the same language that is in the FY11 GAA. Comparison - Neither proposal would have an adverse impact. 8

9. FY12 Budget: H/SWM Comparison 3000-4060 Income Eligible Account Appropriation: House: $237,397,940. This number would allow EEC to eventually open access in FY12 for children in need of services. Senate: $227,965,287. Senates level would force access to remain closed for all cases and allow attrition to make up the structural deficiency built into FY12s budget. Comparison- Both proposals allow us to support the ARRA (cliff) children, but the House level provides hope to families on the waitlist that their children may receive services in FY12. Language: Minor difference which has no impact. 9

10. FY12 Budget: H/SWM Comparison Quality Supports and Family Engagement 10 House : Consolidated the Quality Supports account into the Family Engagement item and level funded. Segregated out from 3000-7050 the Reach Out and Read into a separate line item (3000-7070) and funded it at $500K (it was funded at $585K in FY11). The $500K was not backed out of the consolidated account. Senate: Does not consolidate the Quality and Family Engagement items. Like the House, segregated out from 3000-7050 the Reach Out and Read into a separate line item (3000-7070), but funded it at $800K. The $800K was backed out from the 3000-7050 account; therefore, all other grants from the Family Engagement will have to be reduced by $300K in FY12 to subsidize the Reach Out and Read program increase. Comparison – House level of funding would allow EEC to fund QRIS.

11. FY12 Budget: H/SWM Comparison Other Differences and Outside Sections 3000-6076 Mental Health: House: $750,000 – enables EEC to provide same level of grant amount in FY12 as in FY11. Senate: $600,000 – would force EEC to reduce the FY12 grant amount by 25%. Caseload Forecasting Office (Outside Section 6) Senate proposes creating, effective July 1, 2011, a central office that would project caseload for EEC, DTA, Medicaid, GIC, Housing and all other entitlement programs. EEC would be required to provide data to enable this central office to project caseload. The Commissioner, or her designee, would have a seat on the board that would govern the Office. Comparison - Would dedicate statisticians to analyze data and provide estimates for EEC and the Commonwealth as a whole. 11

12. FY12 Budget: H/SWM Comparison Accounts not in Discussion The following accounts are not in conference or have only minor differences within language and money that must be settled in conference committee: 3000-3050 Supportive: Both House and Senate recommend $77.4M and have similar budget language. 3000-4050 Income Eligible: House recommends $133.4M in FY12 and Senate proposes $132.5M. Both appropriation levels are insufficient to meet anticipated needs in FY12. 3000-5000 Head Start: Both the Senate and the House recommend funding Head Start at $7.5M. 3000-5075 UPK: Both the Senate and the House recommend funding UPK at $7.5M. 12

13. FY12 Budget Process Governor Submitted January 26, 2011. Proposed an overall EEC budget of $498.5M, which is essentially level funding Consolidates the Caseload accounts. House Completed April 28, 2011. Proposes an overall EEC budget of $501.2, which is $2.5M higher than the Governors proposal Does not consolidate the caseload accounts, but does consolidate the Quality and Family Engagement line items and funds Reach Out and Read into its own line item. Senate Completed May 26, 2011. Proposes an overall EEC budget of $488M, which is $13M lower than the Houses proposal Does not consolidate the caseload accounts, and funds Reach Out and Read into its own line item. Creates a new office, Caseload Forecasting Office, to centrally project caseload (DTA, Medicaid, EEC, GIC and Housing) Conference Committee To reconcile the difference between the House and Senate versions a Conference committee comprising 3 members from each the House and Senate convenes. The report of that committee is typically completed by mid to late June. The House and Senate enact the bill and send it to the Governor for his signature The bill becomes law upon the Governors signature. Vetoes and Overrides Governor may sign the bill with objections to certain items. Everything outside of those vetoed items become law July 1. The vetoed items must be overridden by 2/3 of the House and then the Senate. FY12 Budget Complete Once vetoes and overrides are done the FY12 GAA (General Appropriation Act) budget process is complete. 13