DATE: June 21, 2010 

 

Calling it "a piece of the Budget solution," Senate Pro Tem Darrell Steinberg (D-Sacramento) and Budget Conference Committee Chair Denise Ducheny (D-San Diego) today presented a detailed outline of the Senate Democratic Restructuring Budget Proposal.  At a morning press conference, they said the multi-year restructuring plan saves billions while providing quality services more effectively.

 

"The proposal is an alternative to elements of the Governor's budget that would harm our economic recovery, result in more than 450,000 lost jobs, and dramatically reduce the quality of life for all Californians," their press release said.  "Finding an alternative to the Governor's budget plan is critical because in spite of the 'terrible' cuts it imposes, if adopted, it would still leave California with more than a $6 billion budget deficit next year."
 
The Senate Democrats claim that the proposal implements reforms that shrink state government, increase government efficiency, and reduce the size of the state's structural deficit.  It, they say, also improves government accountability by clarifying areas of responsibility for state and local governments as well as bringing services closer to the people in a manner that promotes efficiency and encourages innovation.  Under the proposal, the State would begin to transfer $3-4 billion worth of public safety, human services, and health investments to counties to administer along with a revenue stream that does not increase the existing tax burden on regular Californians.

 

"Our challenge now is to find a way to save essential investments in education, health, public safety and infrastructure - investments necessary to create jobs and expand the state's economy," Steinberg said.  "While these investments are critical to California's economic future, we cannot credibly use them to prop up the existing government structure that has failed too many for too long.  Through a multi-year restructuring of government, we can save billions of General Fund dollars by moving programs off our books while still giving counties secure and adequate funding to maintain the core services that protect communities and the most vulnerable in society."

 

"The Governor's budget proposal would further setback our economic recovery by taking billions of federal money out of our economy and putting hundreds of thousands of families out of work," Senator Ducheny said.  "We have an obligation to develop alternatives that will improve public safety and make our safety net programs sustainable by delivering them in the most cost effective and accountable way possible."

 

Realignment Includes Giving CalWORKs Child Care to the Counties
 
Here are the details of the proposal which would create three new local accounts: Public Safety, Welfare-to-Work, and Protective and Aging Services for Adults.  Please note that the Welfare-to-Work account includes shifting the responsibility and funding of CalWORKs child care to the counties.
 
                                   Improving Public Safety (Account #1)
 
Goal:  Restore the ability of local communities to provide safe streets and improve outcomes for families impacted by drug and alcohol abuse.
 
Transfer Community-Based Public Safety Programs from State to Counties (up to $1.6  billion over 4 years):
   
   Public Safety Sub-Account #1:
     A. Shift state juvenile parole services to counties (modified version of Governor's May Revision proposal).
     B. Shift certain low-level criminal offenders (primarily drug and property crime offenders) to counties for both incarceration and community supervision (modified version of Governor's May Revision proposal).
     C. Maintain existing funding for COPS/Juvenile Justice program (set to expire in 2011-12).
   Public Safety Sub-Account #2:
     D. Shift Drug Medi-Cal programs to counties.
     E.  Shift Offender Treatment Program to counties.
     F.  Restore Substance Abuse and Crime Prevention Act Funding to counties.
     G.  Shift Drug Court Program to counties.
  
                        Improving the Welfare-to-Work Program (Account #2)
 
Goal:  Provide counties with flexibility and incentives to tailor CalWORKs program to address local needs and gain efficiencies.

 

Increase County Share of CalWORKs and Transfer CalWORKs Child Care to Counties (up to $2.6 billion over 4 years):
 
     A.  Increase county share of CalWORKs grants from 2.5 percent to 25 percent.
     B.  Increase county share of CalWORKs services and administration to 25 percent.
     C.  Increase county share of county welfare automation to 25 percent.
     D.  Shift CalWORKs child care to counties.
 
                  Improving Protective and Aging Services for Adults (Account #3)
 
Goal:  Give counties additional fiscal incentives to manage protective and aging services for vulnerable adults and elderly.   
 
Shift Adult Protective Services and Various State-Supported Aging Services to Counties (up to $85 million over 4 years):
 
     A. Realign Adult Protective Services to counties
     B. Realign Aging programs to counties

Also, eliminate the Department of Aging; transfer any necessary remaining functions to other state agencies (such as Department of Social Services), and add one Aging oversight position to HHS Agency.

Financing the Plan

Goal:  Give counties additional revenues to pay for the restructured services.  This should take the form of both new revenue streams and authority for counties to raise additional revenues on their own to deliver the services and meet the needs of the community.   
 
Total New Local Revenues Needed:  About $3.2 billion in 2010-11, and increasing to about $4.3 billion by 2013-14.

     A. Oil severance tax (ongoing, beginning in 2010-11).
     B. Transfer VLF funds from DMV to counties (ongoing, beginning in 2010-11)
     C. Continue existing VLF rate that is set to expire in 2011, dedicated to public safety programs (ongoing, beginning in 2011-12).
     D. Dedicate county savings from federal healthcare reform to restructuring services (ongoing, beginning in 2013-14).
     E.  Provide "bridge" funding from delay of corporate tax breaks (in 2010-11 and 2011-12 only).
     F.  Provide a portion of state's sale tax rate (less than ¼ cent) to counties for realigned services as secondary "bridge" (in 2012-13 only).   
 
Proposal's Welfare Cost-Shifts Detailed

 

The Senate proposal includes details on the state-county cost shifts over the next four years.  Below, I detail the ones for Welfare-to-Work (Account #2) because it affects child care and development most directly.  (The other accounts are detailed at the Senate Democrats' website.)  The four figures are totals for FY 2010-11, FY 2011-12, FY 2012-13, and FY 2013-14, and are represented in millions.

 

More to come ...