1. FY 12.13 (+1?) BUDGET PROPOSAL The big, painful picture….

2. Keep this is mind from FY 11.12 The enacted budget for FY 11.12 shifted General Child Care out of Proposition 98 leaving State Preschool as the only early education protected by Proposition 98.

3. Governor’s January Proposal  Emphasis on work, local determination and flexibility, vouchers  Priority is CPS and at risk kids first then families on cash aid then families not on cash aid.  Work or no services!  Lower income cap, reduced provider payments  Overall reduction in funding of roughly 30%

4. The fine print of the cuts in FY 12.13 - $516.8 million  Reduce eligibility from 75% of SMI to 200% of the federal poverty rate (about 61.5% of SMI)  Reduce RMR from 85 th percentile of 2005 market survey to 50 th percentile of 2009 survey.  WORK is the only qualifying need  Reduce SRR by 10%

5. So what is this +1 stuff?  In FY 13.14, eligibility and payment functions (BOTH APP and center based) will shift to Department of Social Services.  In FY 13.14, only working families receiving cash aid will qualify for child care services.  In FY 13.14, all funding except Prop 98 State Preschool will shift to a voucher system thus eliminating all full day and some part day Title 5 centers and quality components.

6. Remember the Prop 98 transfer? The fine print is what’s in danger.  The title of a contract (CSPP/CCTR) is not the funding stream.  The operating calendar doesn’t determine the funding stream.  Half day doesn’t equate to a Prop 98 funding stream.

7. So what is your funding stream? Look under (Optional Use) on page 2 of your contract:  Prop 98: 23038,24818, 54859, & 24905  Any other code is general child care (no matter how it used) and thus proposed to be transferred to DSES in FY 13.14

8. Floating questions:  Renovation & Repair Contract 3 year use obligations?  Supplies bought with CDD funds?  Facility Revolving Loan 10 year use obligation?  Reserves?  College Impact?