1. 1 DHS BUDGET PRESENTATION TO MICHIGAN CHILD CARE TASK FORCE March 3, 2010 Jennifer M. Granholm, Governor Ismael Ahmed, DHS Director Jane Schultz, DHS Budget Division Director

2. 2 MISSION The Department of Human Services provides services to vulnerable children, adults and families.

3. 3 HIGHLIGHTS State budget process Child Development and Care (CDC) appropriations Funding sources and how their use is determined

4. 4 STATE BUDGET PROCESS Governor is required to propose a balanced budget (Article V, section 18). State Budget Office (SBO) provides guidelines/direction to departments. Departments provide their requests to SBO. Governor makes decisions and presents budget to legislature.

5. 5 LEGISLATIVE ACTION Bills are introduced in both houses and divided for consideration. Bills are assigned to appropriations subcommittees. Hearings are held to discuss issues/ budget changes from current year.

6. 6 LEGISLATIVE ACTION, CONT’D Subcommittee writes bill. Full committee considers bill. Full chamber considers bill. Conference committee works out differences. Passed, ordered enrolled, and signed by Governor (vetoes).

7. 7 BUDGET REVISIONS AND CLOSING THE BOOKS Budget revisions –Executive Order reductions –Supplemental appropriations –Transfers The books close after the end of the fiscal year.

8. 8 FY 2010 SUPPLEMENTAL HIGHLIGHTS $266.3 million for $1LIHEAP implementation/FAP benefits $123.1 million for caseload adjustments $13 million to restore JET Plus $7.7 million for 197 additional field staff $3 million for family preservation

9. 9 FY 2011 PROPOSED BUDGET GF/GP:$959 millionAll Funds:$7 billion Miscellaneous covers Community Improvement, Child Support Enforcement, Disability Determination Services, Adult & Family Services, Administration and Information Technology.

10. 10 FY 2011 PROPOSED BUDGET BY FUNDING SOURCE

11. 11 FY 2011 PROPOSED BUDGET INCOME ASSISTANCE ONLY

12. 12 CHILD DEVELOPMENT AND CARE Financial assistance for CDC to qualifying families with the goal to promote safe, affordable, accessible, quality child care Categorical eligibility (no co-pay) for family groups receiving FIP assistance, foster care families, and families with protective service cases – approximately 41% Income eligibility (5% - 30% co-pay), i.e., for monthly income below $1,990 for family of 3.

13. 13 CHILD DEVELOPMENT AND CARE PROVIDER TYPES Provider TypeNumber% Child Care Center1,9047.8% Group Home1,7807.3% Family Home1,9498.0% Relative11,27146.0% Aide7,55230.8% License-Exempt240.1% Total24,480100.0%

14. 14 CHILD DEVELOPMENT AND CARE SPENDING AND CASELOAD TRENDS

15. 15 CHILD DEVELOPMENT AND CARE Auditor General program audit issued July 2008 found Improper payments Implementation of controls –Provider time and attendance record review –Review of high risk cases –Payment and billing verification improvements

16. 16 CHILD DEVELOPMENT AND CARE FY 2009 DEPARTMENT MAXIMUM HOURLY RATES Child Care CenterFamily and Group HomesRelativesAides SHLTR AREA CHILD'S AGE ALL AGES 0-2½ Yr2½ Yr +0-2½ Yr2½ Yr +0-2½ Yr2½ Yr + I$2.60$1.97$2.38$2.08$1.95 $1.40 II$3.11$2.33$2.28$2.08$1.95 $1.40 III$2.75$2.08$2.44$2.08$1.95 $1.40 IV$3.48$2.33$2.38$2.08$1.95 $1.66 V$3.53$2.33$2.75$2.18$2.20$2.04$1.66 VI$3.95$2.60$3.11$2.60$2.44 $1.66 RESTRUCTURED FY 2010 DEPARTMENT HOURLY RATES – 2009 PA 129 Sec. 675 Child Care CenterFamily and Group HomesAides/Relatives- Tier 1Aides/Relatives- Tier 2 CHILD'S AGE 0-2½ Yr2½ Yr +0-2½ Yr2½ Yr +0-2½ Yr2½ Yr +0-2½ Yr2½ Yr + $3.75$2.50$2.90$2.40$1.85$1.60$2.20$1.85

17. 17 CHILD DEVELOPMENT AND CARE FUNDING SOURCES Temporary Assistance to Needy Families (TANF) Child Care Development Fund (CCDF) CCDF ARRA Other federal funds State General Fund

18. 18 CHILD DEVELOPMENT AND CARE FY 2010 FUNDING Regulated Day Care (in millions) –$127.2 Total –$19.7 General Fund –$107.5 Federal $26.9 TANF $58.8 CCDF $11.2 CCDF ARRA $10.6 Other Federal

19. 19 CHILD DEVELOPMENT AND CARE FY 2010 FUNDING Unregulated Day Care (in millions) –$111.6 Total –$16.2 General Fund –$95.4 Federal $23.8 TANF $51.7 CCDF $9.9 CCDF ARRA $10.0 Other Federal

20. 20 TANF The federal TANF Program is designed to help needy families achieve self-sufficiency by providing assistance and work opportunities to needy families through a block grant to states, giving them wide flexibility to develop and implement their own welfare programs. States may use TANF funding in any manner "reasonably calculated to accomplish the purposes of TANF."

21. 21 TANF CONT’D TANF purposes are: –assisting needy families so that children can be cared for in their own homes. –reducing the dependency of needy parents by promoting job preparation, work and marriage. –preventing out-of-wedlock pregnancies. –encouraging the formation and maintenance of two-parent families.

22. 22 CCDF The federal CCDF is the primary program devoted to child care services and quality. It enables low- income parents and TANF parents to work or be in education and training programs needed to work. Approximately $16 million of the funds must be used to enhance child care quality and availability.

23. 23 STATE GENERAL FUND The state’s General Fund is used for the ordinary operations of the state. It may be used to fund any activity.

24. 24 QUESTIONS? Jane Schultz Budget Division Director Department of Human Services 517-241-2453 schultzj@michigan.gov