State Budget Deal Satisfies Low Expectations
New York Nonprofit Press March 28, 2012
It is a sign of the times! Human service providers and advocates appear to be viewing preliminary details of a State budget agreement that provides no across-the-board increases in funding to meet rising costs – but few new spending cuts – as relatively positive. It is, they say, as good as they could expect given the State’s overall fiscal situation. And, providers praise a broad range of individual funding restorations in the final budget deal as well as several key new programmatic initiatives, including the “Close to Home” juvenile justice reform and the new $60 million MRT Supportive Housing Development to serve high cost Medicaid recipients.
“While we enjoyed some important restorations to human services for FY13, we have to put this in context of the nearly one billion in direct service cuts and an estimated 27,000 jobs lost in the last two years,” said Chris Winward, Director of Budget and Policy at Human Services Council of New York. Winward noted that new investments in business development and restorations in education saw about a billion dollars of funding added to the final budget, while human service programs adjustments totaled only $150 million.
“Given the circumstances, this is not a bad budget,” says Phillip Saperia, Executive Director of the Coalition of Behavioral Health Agencies. “It didn’t go as far as we wanted, but we avoided having massive direct cuts.”
“We are relieved that the enacted state budget does not contain the devastating 10 billion dollars in cuts that last year’s budget did,” says Fatima Goldman, Executive Director & CEO of the Federation of Protestant Welfare Agencies. “Nevertheless, funding for many low-income youth services which were cut by 50% last year as well as some programs for the elderly which were also cut, have not been restored. This is of immense concern given that the Great Recession forced an additional 120,000 New Yorkers into poverty and the city’s poverty rate up to 20.1%.”
“In light of current economic conditions, this budget is not as bad as it could have been,” says Peter Pierri, Executive Director of the Interagency Council of Developmental Disabilities Agencies. “It is much better than last year.”
Although the budget does not include Cost of Living Adjustments (COLAs) for nonprofit service providers this year, advocates were able to fend off efforts to permanently eliminate COLA provisions in future budgets. Governor Cuomo had proposed moving to a yet-to-be determined system of “performance-based” funding adjustments in place of automatic COLAs. Instead, the final deal calls for another “deferral” of the multi-year COLA package, thus leaving the basic COLA framework in place for the future. “We are very pleased that our advocacy to protect the human services COLA by deferring it rather than eliminating it, and without performance standard language, paid off,” said HSC’s Windward.
Executive Comp & Admin Caps
Providers were less enthusiastic about the Budget’s failure to reject Governor Andrew Cuomo’s Executive Order language capping state funding for executive compensation above $199,000 and limiting State expenditures for administrative overhead to 25% of total spending… declining to 15% over the next three years. Now, all eyes are focused on regulations being developed by individual state agencies to implement the Executive Order.
Advocates cited creation of the new MRT Supportive Housing Development Program as a major step forward.
“The establishment of the MRT Supportive Housing Development Program demonstrates the depth of this Governor’s commitment to New York’s most vulnerable people,” said Ted Houghton, Executive Director of the Supportive Housing Network of New York. “The Governor’s initiative will allow thousands of people with chronic illnesses and disabilities to move into supportive housing, which will greatly reduce their reliance on expensive emergency rooms, hospitalization and institutional care. Not only will they have a better quality of life, but we’ll be saving taxpayer dollars, too.
“The program will accomplish two goals,” Houghton continued. “It will enable nonprofit providers to house and serve approximately one thousand high-cost recipients of Medicaid services in new scattered site supportive housing units this year; and it will accelerate capital development under the New York/New York III Supportive Housing Agreement, leveraging millions more in public and private capital investment. And this is only the beginning — the budget contains explicit community reinvestment language that will use future savings from nursing home and hospital bed closures to create additional new housing and service opportunities to allow people with chronic illnesses and disabilities to live in the community.”
“This is really big,” says Phillip Saperia. “We’re very happy about this.”
HSC reports that other human service restorations included work supports and employment training for struggling New Yorkers, $14 million for a number of child care programs (in addition to the $93 million in funding the Governor submitted to offset the loss of federal dollars), $250,000 for English as a Second Language/Adult Basic Education, $1.5 million for the NYS Supportive Housing Program, and $3 million for the Advanced Technology Training & Info Networking (ATTAIN) and $750,000 for the Career Pathways TANF initiatives. Restorations were also made to services for survivors of domestic violence with $1.2 million for Non-Residential Domestic Violence and $1 million for the Safe Harbor program, which serves victims of child sex trafficking.
“We are pleased with agreement of the final budget especially retaining the statutory 65% formula for preventive services, approval of the Close to Home juvenile justice reform, and the restorations for Safe Harbor, Community Reinvestment, and the Settlement Houses,” says Jim Purcell, CEO of the Council of Family and Child Caring Agencies (COFCCA). “Of course with no funding for the increases in the cost of living for things like gas, Health insurance, food, etc we will all be looking for meaningful mandate relief from the state agencies.”
“UNH is of course gratified to see a $1.45 million restoration of funding for settlement houses statewide, and we thank Speaker Silver for recognizing the importance of this ongoing support,” says Nancy Wackstein, Executive Director of United Neighborhood Houses. “We were pleased to see additional funding for NORCs (naturally occurring retirement communities) as well. We still are trying to understand the youth funding picture. It is not clear yet how much additional youth funding will come to New York City, but we certainly need every bit we can get!”
Mental Health Services
“We’re generally pleased with the outcome of this year’s budget negotiations, especially as regards the renewed commitment to reinvest savings from state hospital bed reductions to boost community recovery services, the creation of the supportive housing reinvestment fund, the provision to mainstream public education for children in state psychiatric facilities, the funding of $3 million more in managed care enrollment brokers and the modified restoration of prescriber prevails protections within Medicaid managed care plans,” said Harvey Rosenthal, Executive Director, New York Association of Psychiatric Rehabilitation Services. “We must now turn our attention to trying to help shape the way the state integrates behavioral and medical healthcare in the integrated managed design to come and the pending proposal to “pay for performance” we are anticipating for next year.”
Employment & Public Assistance
“New York’s unemployment and underemployment rates have not come down very much because of the slow economic recovery. For this reason we are very disappointed that jobs programs and job training programs for the poor and unemployed were not restored to their 2009-10 levels,” stated Bich Ha Pham, Director of Policy, Advocacy and Research at FPWA. “However, the enacted budget does keep its promise to the poorest by restoring the final 10% planned increase for the public assistance grant. An average family of three in New York City will see an increase of about a dollar a day.”
A proposal which would have required that Early Intervention providers negotiate reimbursement rates with third-party insurers reportedly has been rejected. Instead, providers will now be able to continue receiving the full state approved rate as reimbursement. “This would have been extremely detrimental for providers’ ability to survive,” says IAC’s Peter Pierri.
The Council of Senior Centers and Services (CSCS) praised what they called “a tremendous victor for seniors”. “EPIC coverage has been restored before and after the coverage gap called the ‘donut hole’ with a maximum copayment of $20,” says Bobbie Sackman, Director of Public Policy for CSCS. “Coverage during the donut hole will continue as is currently the case. The entire cut to EPIC was not restored so seniors will still have to pay the Medicare Part D deductible.”
No Revenue Reform
At the same time, however, advocates bemoaned the budget’s failure to include any revenue reforms in terms of closing tax loopholes. In a rally this morning, representatives of New Yorkers for Fiscal Fairness, Strong Economy for All Coalition, Fiscal Policy Institute, Labor-Religion Coalition of NYS, Human Services Council, Citizen Action, New York Students Rising, PSC-CUNY, Alliance for Quality Education, Statewide Senior Action, UnitedNY, the New York State United Teachers said the about-to-be-passed New York State budget falls short when viewed from the perspective of regular New Yorkers.
“Lawmakers continue to shower Wall Street and big business with over a billion dollars worth of tax loopholes and special subsidies,” said Michael Kink of the Strong Economy For All Coalition. “We don’t need to be subsidizing Goldman Sachs and Morgan Stanley – they’re doing fine on their own. But we should be doing more for students, for local community human services, and for small businesses that are still stuck in the recession.”
“It seems our budget once again ignores the neediest of our citizens in New York State. While the Governor and Legislature agreed to allow the scheduled increase in the public assistance grant to be enacted they have virtually ignored the soaring homelessness, hunger and poverty that is pervasive in our state,” said Ron Deutsch of New Yorkers for Fiscal Fairness.