1. Budget and Caseload Update Policy and Fiscal Committee January 3, 2011

2. Table of Contents  FY11 Caseload Overview  FY11 Projected Deficit  ARRA Spending  FY12 Budget in Process 2

3. FY11 Caseload Overview Income Eligible is projecting a $5M deficiency. This is a reversal of the previous month’s projection of a $63K surplus. The main driver for the change is adjustments made to previous months’ caseload which drives caseload up by 1,000 children. This dramatically increases the pressure on the voucher caseload. DTA-Related Caseload: Goes from a projected deficiency of $3.1M to $7.5M because November services increase the projected monthly average caseload by 155 children and the average daily cost per child (one of the factors used in projecting caseload) increases from $30.57 to $31.74. Supportive: Goes from a projected surplus of $8M to $12M because November services decrease the projected monthly average caseload by 219 children and the average daily cost per child (one of the factors used in projecting caseload) decreases from $50.51 to $48.44. Reminder: Due to the economic climate, ANF has notified agencies that there are limited resources to address deficiencies through a supplemental budget in FY11; and agencies must take action to prevent deficiencies in their accounts. This may mean that EEC is expected to address a deficiency in the DTA account by transferring funds (under the 3% allowable language) from the Income Eligible account. 3

4. 4 Fiscal Year 2010 Income Eligible (3000-4060) * Actual Amount Previous month projected a $63K surplus.

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7. 7 Fiscal Year 2011 DTA Related (3000-4050) Previous month projected a $3.1M deficiency.

8. 8 Fiscal Year 2011 Supportive Care (3000-3050) * Actual Amount Previous month projected a surplus of $8M.

9. FY11 Caseload Overview – Solutions 1. Close access to the Income Eligible account effective February 15, 2011. Based on current projections this would reduce the Income Eligible Deficiency from $5M to $3.7M; and 1. Request full transferability from the Supportive account to the Income Eligible and DTA-Related accounts. Currently, EEC is only allowed to transfer money to the Supportive account. With a $12M projected surplus, this money would eliminate the projected Income Eligible and DTA-Related account deficiencies. 9

10. Income Eligible – FY11 Scenarios 10

11. FY11 Caseload Overview – Summary (without closing access in IE) 11 Previous month’s update projected an overall $5M surplus in the caseload accounts.

12. FY11 Caseload Overview – Summary (with closing access in IE) 12

13. FY11 Caseload: Waitlist 13 * As of December 28, 2010; Previous waitlist (November 30, 2010) was 18,069. Waitlist has been reduced by 1,795 or by 9.9% since the last update (November 30, 2010).

14. ARRA Spending Update 14

15. ARRA Spending by Month 15 It is anticipated that ARRA spending will average $1.7M per month for the remainder of the program.

16. FY12 Budget Update The Executive Office of Education hosted two public forums on the Commonwealth’s Fiscal Year 2012 budget. Each forum began with a brief presentation providing the context for the FY12 budget followed by an opportunity for community members to provide feedback on funding priorities for the upcoming year. These forums provided a unique opportunity to learn more about the current state of the FY12 budget and help ensure the debate includes the priorities of those most directly impacted by budget decisions. The Commissioner attended the hearing on December 21 at Worcester State University. The Deputy Commissioner attended the hearing on December 23 at English High School in Jamaica Plain. Both hearings were well attended and testimony was offered in support of EEC programs. 16