1. Fiscal Year 2010 Budget Update Board of Early Education and Care June 9, 2009

2. 2 FY10 Budget Process Massachusetts State Budget Cycle

3. 3 FY10 Budget Process State Budget Process September: State agencies submit current fiscal years spending plans to Governors budget office December: EEC Board submits next fiscal years budget request to the Secretary of Education for the Governors consideration January: Governor submits budget (H1) to Legislature April: House Ways and Means submits budget proposal, which full House amends and votes to approve May: Senate Ways and Means submits budget proposal, which full Senate amends and votes to approve June/July: Joint Conference Committee reconciles differences, and both House and Senate vote on the final compromise bill; Governor vetoes and/or signs.

4. 4 FY10 Budget Process FY2008 – FY2010 Funding Summary Fiscal Year 2008 FY08 Actual Spending = $540.4M Fiscal Year 2009 FY09 Final Budget (GAA) = $575M FY09 Post 9C Budget = $525M Fiscal Year 2010 EECs Board Recommendation = $544M Governors House 1 Revised = $533M House Final = $538M Senate Final = $535M

5. 5 FY10 Budget Process FY2010 Funding Summary

6. 6 3000-1000 Administration Senate budget is $138K less than House; reporting requirements are similar in each version 3000-2000 Access Management House budget is $213K more than Senate 3000-5000 Head Start House budget is $1M more than Senate FY10 Budget Process Conference-able Items

7. 7 EEC Financial Assistance Accounts House: Supports the Governors House 1 structure and language consolidation of the three financial assistance accounts: Supportive, (3000-3050) TANF Related (3000-4050), and Income Eligible (3000-4060). Funding level assumes forecasted projections for TANF and Supportive caseloads remains accurate, maintenance of current access restrictions for Income Eligible families, and implementation of a number of planned fiscal/policy reforms. Senate: Maintains all three child care financial assistance accounts (Supportive Child Care, TANF Related Child Care and the Income Eligible Child Care) as separate line-items. Earmarks $10.2 million in ARRA access funding for working families. Without the ARRA funds, the funding level (for all three accounts) is $6.4M below the House. Moves 11,672 post-transitional children, and $84M to serve these children from TANF to Income Eligible, and gives them priority status. Recommendation: Support consolidation of the child care financial assistance accounts into a single account will allow flexibility to ensure funds are maximized and targeted to our most vulnerable families.

8. Summary of EEC Financial Assistance Accounts 8

9. 9 FY10 Budget Process Conference-able Items 3000-5075 Universal Pre-K Senate funds $1 million below House House: Remaining funds available after grants are made to eligible programs working toward the designation of being a Massachusetts UPK program participant Senate: Language does not include reference to support emerging programs Recommendation: Support the House budgets language to allow existing funds to be spent on emerging programs

10. 10 FY10 Budget Process Conference-able Items 3000-6000 Quality Program Supports House: Supports the EEC Board and Governors consolidation of line-items that fund program quality initiatives and local planning including Accreditation, Local Planning and Coordination funds (previously included in the Access Management account) and Professional Development funds. Senate: Also supports the EEC Board and Governors consolidation, but earmarks $1.5M from the ARRA CCDF Quality earmarked funds. Without the ARRA funding, this line item is $750K below the House version. Recommendation: Request language in final budget to allow expenditures from this line item for coordinated family and community engagement services grant.

11. 11 FY10 Budget Process Conference-able Items 3000-7050 Family Support & Engagement Senate funds this item $4.4M below the House $7.4M level and does not include any earmarks for specific programs (i.e. Massachusetts Family Networks, Parent Child Home Program, and Reach Out and Read). The Senates level of funding will require a dramatic reduction in support of family literacy and engagement activities at the community level. Recommendation: Support the Houses final budget line item language to allow for coordination between this account and the new consolidated Quality account (3000-6000) in order to maximize access to high-quality child care and family supports in communities across the Commonwealth.

12. 12 FY10 Budget Process Revised Governors Budget (Revised House1) The Executive Office for Administration and Finance have revised House 1 to recognize the following constraints: Reduced revenues: tax revenue for April 2009 fell far short of expectations, $456 million below the revised benchmark for the month and nearly $900 million below targets for the year. Greater use of one-time funds: the need to solve much of the April shortfall by using more federal stimulus funds and state Rainy Day funds than originally planned, leaving less available for the next few fiscal years As a result, the Governor asked agencies to adjust H.1 by nearly $2.0 billion to reflect the lost revenue and remove most of the Stabilization funds assumed in H.1. For EEC, this exercise resulted in our House 1 funding level to be reduced by $8.4 million, from $542 million to $533 million.

13. EECs Revised House 1 Summary 13

14. EEC FY2010 Conference Budget Recommendations Support consolidation of the child care financial assistance accounts into a single account will allow flexibility to ensure funds are maximized and targeted to our most vulnerable families. Critical to include language allowing for children in supportive child care to have a year of transitional care after their case closes and to open access for foster parents. Include language within new consolidated Quality account to allow funding to be expended on new Local Coordinated Family and Community Engagement grants, to maximize access to high-quality child care and family supports in communities across the Commonwealth. Encourage allocation of the ARRA funds as already approved and designated by the EEC Board ($3M) within FY2010 funding. 14

15. 15 FY10 Budget Process Next Steps EEC working with the Secretary of Education and the Executive Office for Administration & Finance (ANF) to submit Board approved Conference Preferences to the Joint House-Senate conference committee. Joint House-Senate conference committee meets to reconcile budgets. Target date for conferenced budget is July 1 st Governor has ten days to veto Legislature has opportunity to override vetoes General Appropriations Act is released