1. John R. Kasich, Governor Tracy J. Plouck, Director, ODMH Orman Hall, Director, ODADAS (Future) Department of Mental Health & Addiction Services May 9, 2013 1

2. Objectives for FY 14 plan Brief review of FY 13 circumstances: SAPT MH Sequester Discuss philosophy Review, discuss scenario options Logistical/fiscal items Identify next steps 2

3. Where appropriate, adopt a consistent philosophy and process for both block grants Review with community partners: The cash challenges of the SAPT Block Grant SFY13 SAPT sequestration impact Funding Scenarios: “What if sequester continues?” 3

4. $62.7MM Basic requirements: 20% prevention $10.9MM womens’ (MOE requirement) Cash availability has been a challenge in recent periods 4

5. Historically, ODADAS has used SAPT resources in concert with GRF and rotary funds (i.e., Fund 4750) Reductions to any one of these sources result in a need to refine all three types of community allocations in order to maintain parity approach among grantees We will be adjusting the budget planning process to reach a solution for predictability 5

6. $15MM (includes carryover) Approx. half disbursed by formula (qtrly) Grants designated by Department priority area (w. Planning Council input) 6

7. MH block grant “base” allocations ($7.5MM) to boards are formula based and separate from other subsidy allocations, i.e., different approach than SAPT Projects are granted through Notice of Award Some are competitive; others non- competitive Priority areas determined by SAMHSA, Planning Council and Director 7

8. Communication to field 3/25 regarding reductions to major federal grants: 5% reductions against FFY13 Notice of Award MH block grant$721,932 SAPT block grant$3,463,988 (reduction of $164,420 from SAPT12 to SAPT13 award plus $3,299,568 SAPT13 sequester reduction) 8

9. FY 13: No reduction impacts to the field during SFY13 as a result of the following; o Utilized AoD state resources to realign originally awarded SAPT dollars o Cancelled unobligated balances and projects that have not yet begun (MH & AoD) FY 14 plan: determine approach in concert with community partners o Application of SAPT13 sequestration reduction over SFY14/15 biennium (8 qtrs) 9

10. Promote transparent planning & monitoring Apply outcomes & accountability to make informed funding decisions Anticipate changes over time based on our work with the field in these planning sessions Begin commitment to address known challenges over a reasonable period of time Support predictable, user-friendly processes Responsive to persons receiving MH/AoD services 10

11. As a new consolidated organization, we are committed to sharing a strategy across grants to the extent possible Examples: shift some SAPT spending related to dual diagnosis; relieve other shared administrative obligations where possible Limited opportunities 11

12. SAPT13 Sequestration Award Amount Subsidy (95%)Admin (5%) SAPT13 Award65,991,36162,691,7933,299,568 Sequestration 5% reduction (3,299,568)(3,134,590)(164,978) Reduced SAPT Award 62,691,79359,557,2033,134,590 Reduced SAPT13 Award Award AmountSubsidy 95%Admin 5% 12

13. For SAPT: Maintain women’s MOE and prevention set- aside Shift some project grants to other sources Apply selective reductions to project grants Timing 13

14. For MH BG: Maintain formula awards to Boards Maintain priority pops – SMI, SED Shift some responsibilities to other sources Apply selective reductions to project grants Timing? 14

15. No formal communication received from SAMSHA to indicate this will happen, or that the 5% initial sequester reduction amount would be the actual amount reduced Amounts if a 5% carries forth (based on FFY13 awards): SAPT: $3,299,568 MH BG: $721,932 15

16. Frame the options Across the board? Notwithstanding MOE and other requirements Amount on “base” v. amount on grants 16

17. We want to achieve two plans by the end of this process: FY 14 with FFY13 total sequester impact of $4.1MM (both MH and SAPT) FY 14 with continued sequester against FFY14 MH and SAPT Block Grants Both scenarios must contemplate SAPT alignment activities 17

18. Basic Information: Feds allow the state 8 quarters to spend the grant, but we spend SAPT in the first four quarters of the federal award. Historically resources obligated to the field in July include an October SAPT Award. Example: SAPT13 October Award supports SFY14 1 st quarter and SAPT14 October Award supports SFY14 2 nd, 3 rd, and 4 th quarters Only 25% of cash for the SFY is liquid and available for disbursement. 18

19. Stretch SAPT Award allocation over more quarters in order to come into alignment with the amount actually available to support SAPT revenues Will result in less cash to the field in short term, but more predictability in short and long term What terms need considered? How may impacts be managed? 19

20. Based on SAPT13 Award Subsidy Portion (95% of Award) Subsidy 4 QTR Distribution Subsidy 5 QTR Distribution Quarterly Reserve for Alignment Original62,691,79315,672,94812,538,359 Sequester (3,134,590) (783,647) (626,918) Revised Amount 59,557,20314,889,30111,911,441 2,977,860 Proposed SAPT alignment solution for reserve 20 Alignment applied over a 5 quarter period would build an SAPT reserve at the Department to off-set federal cash delays. Restored SAPT funding decisions could resume after the initial 5 quarters.

21. Need to “catch up” approximately $3MM each quarter in order to align with federal award availability: No other resources available to cushion the gap that occurs during alignment process Component for consideration: Programs funded with multiple sources (Block Grant, State GRF, Rotary) and how to manage the Block Grant Reduction fairly. 21

22. NEED TO FRAME OUT: Push vs. draw Reporting Other? 22

23. For SAPT alignment Logistical/fiscal Other? Next meeting or specific assignments 23