Early Learning and Child Care BRIANNA BRUNS CA DEPARTMENT OF - PowerPoint PPT Presentation

Governor’s Budget 2017 -18 Early Learning and Child Care BRIANNA BRUNS CA DEPARTMENT OF FINANCE

Economic Outlook  Changing Times: General Fund revenues are not rising as quickly as projected - compared to 2016 Budget Act projections, SAL General Fund revenue estimates have decreased by $5.4 billion over a three year period (2015-16 to 2017-18)  Lower personal income tax revenue – lack of growth in high wage earners  Federal Uncertainty  Prop. 98 continues its upward trend from Great Recession, however growth is declining  Significant recent growth in Early Learning and Child Care programs is not sustainable in the long-term

Changes in Revenue Estimates

State Fiscal Pressures  Rising pension and retiree healthcare costs Prop. 98 General Fund  LCFF target growth Non-Prop. 98 General Fund and Other Funds  Scheduled state cost increases for expanded Medi- Cal access  Minimum wage increases  Cost pressures related to housing costs, homelessness, infrastructure, immigration, etc.

Recent Early Learning and Child Care Policy Augmentations  Since 2013-14, the state has invested the following in Early Learning and Child Care programs:  $388.1 million Proposition 98 General Fund  $447.5 million Non-98 General Fund  Approximately 39,000 new slots  These increases are attributable to:  New preschool and child care slots  Updates to the Regional Market Rate and Standard Reimbursement Rate  Various quality programs including the QRIS Block Grant and other one-time quality investments

2017- 18 Governor’s Budget Proposals for Early Learning and Child Care  Augmentations  Full-year costs associated with the 2016 Budget Act, including:  $42 million for RMR increases  $24 million for 2,959 full-day State Preschool slots  $37 million in total CalWORKs Stages 2-3 caseload adjustments  Pause in the Multi-Year Deal  2016 Budget Act: The Administration and the Legislature agreed to rate augmentations of $317 million non-Prop. 98 General Fund and $110 million Prop. 98 General Fund by 2018-19  As of 2017- 18 Governor’s Budget, the state has made rate investments totaling $163.7 million non-Prop. 98 General Fund and $43.7 million Prop. 98 General Fund  2017-18 Governor's Budget: Pauses further rate augmentations in 2017-18 and extends the multi-year deal through 2019-20

2017-18 Proposed Early Learning and Child Care Budget

2017-18 Trailer Bill Proposals  Increase Provider Flexibility  Option to use electronic applications  Allow children with exceptional needs whose families exceed income eligibility access to part-day State Preschool  Allow state preschool programs flexibility in meeting minimum adult- to-student ratios and teacher education requirements, especially those with a Tier 4 or higher QRIS rating  Increase Alignment Between Programs  Align the state’s definition of homelessness with the federal McKinney Vento Act  Eliminate licensing requirements for state preschool programs using facilities that meet transitional kindergarten facility standards  Simplify process by which school districts can align program minutes for state preschool and transitional kindergarten students

Looking Forward to May  Potential for changes to federal programs and funding  Administration and Legislature engagement on the 2017-18 CCDF State Plan for quality expenditures  CalWORKs child care caseload and cost-of- care updates  Budget hearings, new legislation, stakeholder and legislator priorities

Contact Info Brianna Bruns Finance Budget Analyst, Early Learning and Child Care Department of Finance brianna.bruns@dof.ca.gov (916) 445-0328