News Archive - September 2011Contents:
September 9, 2011 Update on AB 101 - Unionization of Family Child Care Providers Earlier this week, AB 101 was “gut and amended”, to provide for the unionization of both licensed and license-exempt family child care providers. CCDAA has reviewed bill AB 101, and has taken an oppose position on the bill. AB 101, as written does not make any improvements to the health and safety of children or the educational quality of programs. To read a copy of the entire bill please click here. To read a copy of CCDAA's letter, please click here. The Bill is on a 'fast track' through the Legislature, we will keep members posted on its progress. See below for additional articles about AB 101: Sacramento Bee: Democrats push bill to unionize home child care providers Republican Caucus: Senate Democrats Pass Bill to Unionize Family-Member Child Care September 14, 2011 Possible January 2012 Trigger Cuts – Possible New 3% Cut to Current Year Contracts The California State budget for 2011-12 contains a provision for $23 million dollars in mid year cuts (January 2012) to CDD child development contracts if state revenues are $1 billion or more below the expected amounts. This topic will be covered in detail at the CCDAA October 14, 2011 Section Meetings. Background: The Legislature added $4 billion in “cross your fingers” extra revenue to the State budget in June 2011 to finish “balancing” the budget (and avoid another $4 billion in program cuts). Since this additional $4 billion in revenue was speculative, the Legislature built in automatic mid-year budget cuts, to occur in January 2012 if revenues are projected to be lower than the budget estimate. In January the Director of the Department of Finance is charged with looking at state income from July through December 2011, projecting income for January through June 2012, and thereby estimating state income for the full year. If the estimate is $1 billion or more below the budget estimate, then cuts called the “Tier 1 Trigger Cuts” will automatically occur. If the estimate is $2 billion or more below the budget estimate, then cuts called the “Tier 2 Trigger Cuts” will automatically occur. The Tier 1 cuts include $23 million in cuts to CDD child development programs. Tier 2 does not have any cuts to child development (Tier 2 cuts fall heavily on school districts, community colleges, CSU and UC). How will contracts be cut? The Budget bill does not specifically list what programs will be cut, or who exactly makes that decision. CCDAA does not know if the cuts would be proportional to the Preschool Education budget line item that is in Prop. 98 and the Child Care Services line item that is outside Prop. 98. CCDAA is guessing that the Department of Education will be responsible to determine which contracts get cut, and by what amounts, if the Tier 1 cuts occur. CCDAA is also guessing that CDE would spread the cuts evenly between the CCTR, CSPP, CAPP, Stage 3, CFCC and possibly State Migrant contracts. CCDAA totaled the funding provided to these contract types in the budget and divided the total funding by the $23 million cut – it comes out to about a 3% cut. CCDAA will be seeking additional information from CDE as they figure out answers. Will state revenues be below the Budget estimate? No one knows yet. The State Controller announces state revenue after each month, and compares the revenue to the budget estimate for the month. The Controller has now released state income for July and August 2011. In July 2011 state revenue was $539 million below the budget estimate for July. But August 2011 state revenue was $135 million above the budget estimate for August. Combined: for the first two months of the year revenues are $404 million below the budget estimates. What will the state revenue be in December and January? Who knows? (But let’s hope for income far above the budget projections, and a recovering California economy.) What should child development directors do now? CCDAA suggests that directors and fiscal officers start planning now for how you would cut your budget (and possibly your program) by 3% if the Tier 1 cuts are made in January. Remember, the 3% is across the entire year’s budget – not just the January through June budget. So if you have fully earned and spent 50% of your contract (plus parent fees) in July through December, you will need to cut 6% from your January through June budget to make a 3% cut for the full year. The later you actually make cuts, the higher the percentage cut will be. If you budgeted any large expenditures that you can put off until 2012, you may want to put them off. Some directors did not budget for the about 3% (CSPP) or about 5% (CCTR and some other contracts) augmentations that they recently received, and are holding 3% of the augmentation amounts in case the Tier 1 cuts happen. CCDAA Presentation at the October 14 Section Meetings: CCDAA Southern Public Policy Advisor Cliff Marcussen will present an updated report on State revenues, the probability of the Tier 1 cuts happening and efforts to delay any Tier 1 cuts at the October 14, 2011 Section Meetings. There will be time for questions, comments and discussion. CCDAA expects to have September revenue numbers from the Controller prior to that meeting. The presentation will be through videoconference to all three sections. Please register for the October meeting, and bring your fiscal officer. Click one of the links below to register for the CCDAA October 14 Section Meeting. Northern Section Meeting - Pleasant Hill, CA |