July 20, 2009
The Alliance of Early Learning Advocates - Budget Battle in Review
On Friday the Governor signed the budget bill that we have all been working so diligently to impact. Thank you to all who committed their heart, soul, time and energy advocating on behalf of the early childhood system.
We initially fought to make child care a funding priority of this Administration and the Legislature, but the deficit proved to be too big and funding anything became challenging. In order to have a concentrated impact, we focused our efforts on maintaining the Early Learning Initiative (ELI) and minimizing cuts to subsidized child care.
Although the ECE system took substantial cuts in this budget that will have a significant impact on families and providers, including over $280 million over the biennium removed from the early childhood budget from the SFY 09 allocation, we have some victories to share that will help us continue to fight for children’s care and education. Below is a synopsis of some of the outcomes:
ELI
Despite legislators believing they devoted $15 million in each fiscal year to ELI, the Administration has chosen to eliminate this proven and highly successful school readiness program. We fought hard for a transition plan to be developed when it was proposed that 4000 children be cut for this program. Although the Administration did finally implement a transition plan allowing these children to remain in the program until August 22nd; it is extremely unfortunate that this transition plan will now be implemented for the 14,400 children that were enrolled.
Subsidized Child Care
Despite our advocacy, the budget includes reducing eligibility for subsidized child care from 200% FPL to 150% FPL. However, we were successful in minimizing the impact to current families. Families currently enrolled in subsidized child care will be able to remain and be reauthorized until their annual family income reaches 200% FPL.
Initially, the Administration wanted to provide savings to the state by changing the definition of full time care and part time care. This was an attempt to save state money by cutting reimbursement to providers in a manner that was not transparent.
However, due to our advocacy, the administration has decided that the current attendance definitions for full-time and part-time reimbursement will remain the same (25 hours for FT and 7 hours for PT). This is a huge victory that will mitigate the number of programs that will close and the number of families that will no longer be able to find services.
Unfortunately, no additional dollars were added to the budget to allow for this change so cuts had to be made elsewhere to allow for it. We worked with the Administration to identify other dollars within the ECE budget lines that we felt were over estimated given the new environment the system is now facing in order to limit cuts to provider rates. We then asked that in lieu of changing the FT and PT attendance definitions, the cuts to reimbursement be implemented by reductions to the market rate. This allows more providers to easily understand how their businesses would be impacted by these cuts. In addition, it will allow a better level of predictability in funding and the publicly funded system would be changed in a transparent manner, allowing it to more accurately reflect the reimbursement levels for providers.
Other Legislative and Administrative Advocacy Wins Include:
Use of the 2008 Market Rate Survey
We expect to hear this week that the Administration will utilize the 2008 survey instead of the 2006 survey to apply the cuts to the reimbursement rate ceilings. We advocated for this change because utilizing current data will allow a more even distribution of these reduced dollars as they relate to the current market prices. In addition, it will create a much stronger advocacy position in the future as it will once again more accurately communicate the meager reimbursement that providers receive.
Unfortunately, we expect that the Administration will set reimbursement ceilings at the 35th percentile of the 2008 market rate survey. The Federal Health and Human Services Department suggests that states reimburse at the 75th percentile. This reduction now puts Ohio among the bottom in a ranking of the states for reimbursement rates for providers.
Child Care Budget Impact Study Committee
Further, we worked with the Ohio Senate to develop a study committee that will report back to the Legislature on the impact of these budget cuts to children, the ability of children to have access to care, outcomes of school readiness without ELI, impact on child care center layoffs and closures. This will give ECE providers and advocates an official forum in which to share our data on direct impact to children and care due to the cuts.
Addition of Tiered SUTQ Additional Reimbursement
SUTQ rated programs were previously eligible for an additional 5% reimbursement for subsidized child care. We expect the Administration to announce this week that programs with a 2 star rating will now be eligible for 10%, and programs with a 3 star rating will be eligible for 15%. We believe this will help support those programs that have already reached these high levels of quality maintain quality and be buffered some from the cuts to ELI and subsidized child care reimbursement.
In addition, we also expect the Administration to communicate soon a policy change that will allow the SUTQ Quality Achievement Award to be utilized 100% for staff salaries and no longer require a 25% set aside for program improvement. Although we applaud the focus on program improvement, during these difficult economic times it is appropriate that the focus be on maintaining quality.
Extension of Transportation Change Policies
We asked the Administration to extend the deadline for the elimination of use of 12 and 15 passenger vans. Recognizing that the elimination of ELI and the reductions to provider’s reimbursement rates will create challenges for programs to continue services, let alone allow for additional capital purchases, we expect that the Administration will make an announcement soon that they have agreed to extend this date to 2017.
Final Thoughts
Overall, our voices were heard in this turbulent, unpredictable, and unstable economic time. Despite the cuts that will likely mean closure of many of our sites, we also had victories that will help us continue to fight for children’s education and care.
We must remain vigilant. Continue to communicate with your legislators conveying the changes your center is experiencing due to budget changes. We anticipate the Legislature will revisit the budget issues as early as September.
Willa J. Ebersole
Vice President, Pappas & Associates
66 E. Lynn Street
Columbus Ohio 43215
T: 614.621.2000
F: 614.621.0000
M: 614.554.7969
The Alliance of Early Learning Advocates includes Action for Children, the Ohio Association of Child Care Providers, and the Early Care and Education Consortium.
