In today's email:
- Budget by executive order: what does this mean?
- The House Democrats’ new budget proposal
- Why the Office of Early Childhood is important
- ACA: new developments
- Action Alert: home visiting reauthorization
- The economic impact of early childhood
Budget by Executive Order
Connecticut is currently operating without a state budget. June 30th was the last day of the 2017 fiscal year (FY17), and the General Assembly could not reach an agreement before that deadline. As a result, the state government is currently operating using last year’s budget. This means, however, that the budget is sorely out of balance, forcing the Governor to make severe cuts to many programs by executive order so that the state does not fall further into debt during this time.
Nevertheless, there are a few things that the Governor cannot cut that are legally required to be funded: state government must continue making payments on bonded debt, pension, and retiree health care contributions; Medicaid services bound by federal law, and court-ordered child welfare services.
The rest of the budget will see severe cuts across the board, with huge impacts in programs that directly serve children and families. Education funding for municipalities will see a $515 million cut (25 percent). Funding for priority school districts is cut by $42 million (100 percent). Medicaid funding sees a $75 million reduction. School-based health centers see a 25 percent cut. Teen pregnancy programs are cut by half. Care 4 Kids will remain closed. The executive order also significantly curtails payments to many non-profit providers that provide direct services to low-income families. You can find the full text of the executive order, plus supporting documents, here.
As we noted in our public statement last week, Connecticut's current fiscal crisis is the result of years of short-term budget thinking and a failure to address our state's economic challenges. Connecticut needs a stable, responsible budget, with real structural reforms. This shift will not be easy – but it is increasingly clear that the time for short-term, easy solutions is over. We believe that working together, Connecticut can fashion a balanced budget that will support long-term growth and equitable opportunity.
The House Democrats’ Budget Proposal
Just before the end of the fiscal year we saw the introduction of another budget proposal in the Capitol (by our count, the 11th such proposal this year), this time by the House Democrats. The document largely follows the broader lines of the previous Democratic proposal we described in our recent budget analysis, with a few changes. The most significant features of this proposal are:
- Reducing eligibility for HUSKY A parents to 138% of the federal poverty level, without introducing copayments.
- Making smaller cuts than the Governor’s proposals for school-based health centers and community health centers.
- Creating a commission to study changes to the Education Cost Sharing Formula, without cutting funding.
- Adding some additional funding to Care 4 Kids child care program, special education, charter and magnet schools.
- Eliminating the Office of Early Childhood, integrating it with the Department of Education.
- Including some new revenue: a modest increase to the sales tax, as well as a one percent surcharge on restaurant meals that will go to the municipality where they are located.
Overall, the proposal looks a lot like the previous Democratic proposals. This latest one is still an austerity budget that is mostly reliant on cuts, without really tackling Connecticut’s long-term budget woes. However, the inclusion of a bit more revenue and smaller cuts than in other budgets means this budget is a step in the right direction.
House and Senate leadership are expecting to reconvene on July 18th for a vote on this budget proposal. It is unclear if the budget has the votes to pass, or if Governor Malloy would veto the proposal in its current form. We will keep you posted.
Why the Office of Early Childhood is Important
The Democrats’ budget proposal seeks to merge the Office Early Childhood (OEC) into the Department of Education (SDE).
The move is reportedly a response to the current underfunding of Care 4 Kids; the program is currently closed to new applicants. The idea is that by placing it under SDE, the program will have access to a larger pool of funding, and it will be easier to protect the child care program from further cuts, as the state can find other resources within this department.
We saw similar proposals during the legislative session, either moving pieces or merging the whole OEC into other departments. We remain skeptical that this change would make early care and education programs stronger.
First, the OEC was created with the aim of consolidating under one roof the dizzying variety of programs and funding streams related to early childhood in the state, and thereby blending and braiding funding streams to make more efficient use of existing resources. The OEC has been very successful at improving licensing, promoting professional development for providers, and bringing tens of millions of dollars to the state in competitive national grants. Moving all early childhood programs to SDE would weaken this structure and the early care and education system as a whole.
Second, when Care 4 Kids was managed by the Department of Social Services, it saw severe cuts between 2002 and 2005 – a period during which enrollment dropped by half – leading to long-term program closure. Access to other funding streams would likely prove elusive in the context of diminishing federal funding and competing priorities with local school districts. Given the experience of Care 4 Kids in DSS, we doubt that moving OEC into SDE will address potential future funding shortfalls in Care 4 Kids.
ACA: new developments
Congress was in recess last week, meaning that Senators were back in their districts hearing from constituents about the ACA repeal effort. Behind the scenes, negotiations have continued, with several proposals under discussion. The Congressional Budget Office is scoring at least two new versions of the bill, including one that will open the door to eliminating most protections for pre-existing conditions. Senate leaders intend to put the bill to a vote before the end of the month, but several legislators say that any vote is still weeks away.
The bill, if passed in its current form, would have dire consequences for Connecticut. More than 190,000 adults that benefited from the Medicaid expansion in Connecticut would lose coverage. The state could lose up to $11.9 billion in federal funding between 2020 and 2026 once the Medicaid cuts start phasing in.
Although Senate Republicans are having difficulties getting enough of their caucus on board to pass the bill (with 52 Senators, they can only afford to lose 3 votes), the ACA is still in real danger. The fight is far from over.
What can you do to help stop this bill?
- Connecticut’s U.S. Senators are opposed to the repeal efforts. We encourage you to call them to share your story about why the ACA is important and thank them for their support. You can find their contact information here.
- Do you have any friends or relatives who live in states represented by Republican Senators? Call your friends and family, reach them on social media, email them, and urge them to call their Senators. Tell them to share their stories, and to urge them to oppose the repeal. This is going to be a very close vote. Every single call helps.
Action Alert: Home Visiting Reauthorization
The Maternal, Infant, and Early Childhood Home Visiting (MIECHV) program is a federal initiative that facilitates collaboration and partnership at the federal, state, and community levels to improve the health of at-risk children through evidence-based home visiting programs. The program is due for reauthorization this summer – and we need your support.
The Home Visiting Coalition has a petition to ask Congress to fully fund and expand the program. You can sign it here. They are also organizing a day of action Wednesday July 12th. You can find more information on how to participate on their website.
In Case You Missed It: the Economic Impact of High-Quality Early Care
In our new report, we look at the economic impact of high-quality early care in Connecticut.
Access to high-quality, affordable early childhood education boosts the state's economy: in the short term by letting parents continue to work and in the long term by improving lifelong outcomes for children, better preparing the next generation for work and for life.
In this report, we estimate the value of Connecticut's current early child care system to children, parents, and our state, both short-term and long-term. Providing enough high-quality child care to meet Connecticut’s needs could generate $13.4 billion in long-term benefits to the state.
You can download the report here. We would like to thank the Connecticut Early Childhood Funders Collaborative, a project of the Connecticut Council for Philanthropy for supporting this research.
What We Are Reading/ Listening to
- What on Earth Is Wrong With Connecticut?, The Atlantic.
- Healthcare’s Biggest Losers: EPI estimates premium increases under the Senate ACA repeal bill by state. Connecticut would see a 75% average premium increase.
- The Rise of the Thought Leader: How the Superrich Have Funded a New Class of Intellectual, the New Republic.
- Court Monitor Finds DCF Is Still Falling Short of Meeting Children’s Needs, CT News Junkie.
- Racial Disparities Persist Despite Decline In Sudden Unexpected Infant Deaths, CT Health I-Team.
- Senate Bill Would Devastate Health Care in Rural America, CBPP.
- Senate Healthcare Bill Ends Medicaid as We Know It, With Even Bigger Cuts Than House Bill, CBPP.