California State Budget

May Revise 2023
What is the May Revise?

The May Revise is an update to the Governor’s January proposed budget that reflects changes in General Fund revenues, expenditures, and reserve estimates based on the latest economic forecast, and changes in population, caseload, or enrollment estimates. Basically, the May Revise adds or subtracts money from proposals in the January proposed budget, adds or eliminated proposals, and outlines adjustments to minimum funding guarantees in education (Prop. 98).

The May Revise was released on May 12, 2023, which projects a $31.5 billion shortfall in the state budget. The January projection was a $22.5 billion dollar shortfall, so the May Revise has to adjust for an additional $9 billion by either cutting various expenditures, raising revenue, or a combination of both, in order to submit a balanced budget. The Governor’s January budget, the May Revise, and the enacted budget (to come in July) can be read here:

May Revise Proposed Adjustments

Below are adjustments to the Department of Developmental Services proposed budget, as well as adjustments (not an exhaustive list) in other departments that have the potential to impact services outside DDS for the IDD community.

Department of Developmental Services A

The number of individuals served by regional centers is expected to be 396,375 in the current year and increase to 420,927 in fiscal year (FY) 2023-24. The May Revision projects 312 individuals will receive state-operated services (Developmental Centers and Community Crisis Homes)

The 2023 May Revision includes $14.1 billion total funds (TF) ($8.5 billion General Fund [GF]) for FY 2023-24; a net increase of $1.8 billion TF ($1.5 billion GF) over the updated FY 2022-23 budget, or a 14.6 percent TF increase. In addition to caseload and utilization updates, the proposed FY 2023-24 funding supports the following new and updated items:

·         $18.0 million (TF) for Coordinated Family Support Services. CFSS is designed to assist adults living with their families in coordinating the receipt and delivery of multiple services, including generic services. The Budget includes funding to continue supporting the pilot through FY 2023-24. Current funding is through the Home and Community-Based Services Spending Plan.

·         $15.0 million ($8.5 million GF) Rate Model Assumptions/Adjustment for Independent Living Services. The Budget includes ongoing funding to adjust service provider rates for Independent Living Services reflecting more equivalent occupations and duties performed by those occupations effective January 1, 2024.

·         $11.6 million ($8.4 million GF) for Regional Center Operations Policy Update. Funding to update service coordinators’ and supervisors’ salaries to the state equivalent salary level in Enhanced Service Coordination, Performance Incentives, and Early Start Eligibility.

·         $330,000 ($231,000 GF) for START Training. Funding for service provider network fees supporting the certified START teams. START is an evidence-based, community crisis prevention and intervention service model for individuals aged 6 and older with intellectual and developmental disabilities (IDD) and mental health needs (IDD-MH). 

·         $10.8 million forCommunity Placement Plan Reappropriation. The Budget includes resources reappropriated from FY 2020-21 to support multifamily housing projects.

·         -$13 million Lanterman Act Provisional Eligibility Ages 0 through 4. This Budget reflects anticipated eligibility for federal financial participation beginning in January 2024 reducing the General Fund costs of provisional eligibility by expanding eligibility to include children birth through two years of age. The resulting eligibility for this policy is birth through four years of age.

·         Continues suspension of the Annual Family Program Fee and the Family Cost Participation Program until December 31, 2023, to allow regional centers to restart assessments. Prior to the 2022 Budget Act, both programs had been suspended during the COVID-19 Pandemic through department directive. DDS conducted stakeholder discussions and will report on those conversations as part of the May Revision.

April 1, 2023 Finance Letters include:

·         Compliance with Federal Home and Community Services-Based Requirements ($5.4 million TF, $3.8 million GF): This Budget includes funding to support 9.0 DDS positions and 50 positions for regional centers to address and sustain new and ongoing efforts to comply with federal requirements.

·         Porterville Developmental Center (PDC) Facility Support and 1.0 position: This Budget includes funding to support project and facility maintenance activities at PDC.

·         Information Security Office Support: Increase of $174,000 TF ($139,000 GF) and 1.0 permanent position to support regional center information security efforts, augmenting the original Budget Change Proposal submitted in the 2023 Governor’s Budget.

·         Headquarters Position Authority: Increase of 71.0 permanent positions to reflect staff previously funded through recent legislative augmentations or existing resources.

Health and Human Services Agency Adjustments

$10 million ($9 million GF) to establish the Health and Human Services Innovation Accelerator Initiative, a public-private partnership to create an environment for researchers and developers to create solutions to health challenges.

Department of Health Care Services

·         Renewal of the Managed Care Organization (MCO) Tax, effective April 1, 2023 through December 31, 2026, resulting in $19.4 billion to help maintain the Medi-Cal program with $8.3 billion over the MCO Tax period for General Fund offset, which represents $3.4 billion (a $2.5 billion increase over the Governor’s budget) in General Fund offset in 2023-24, and $11.1 billion over 8-10 years to make improvements to the Medi-Cal program, as follows:

·         $237million ($98 million GF) in2023-24, beginning January1,2024, and approximately $580 million ($240 million GF) annually thereafter to increase rates to at least 87.5 percent of Medicare rates for primary care, obstetric care (including doulas), and non-specialty mental health services; and,

·         $10.3 billion, including $922.7 million in 2023-24, to be set aside for future consideration by the administration and to be included in the 2024-25 Governor’s Budget.

·         $128.9 million in 2023-24, $234 million in 2024-25, $290.6 million in 2025-26, and $290.8 million in 2026-27 and ongoing (all GF) for DHCS and the Judicial Branch to implement the CARE Act. Includes $67.3 million in 2023-24, $121 million in 2024-25 and $151.5 million in 2025-26 and ongoing to cover local county behavioral health department CARE Act costs.

·         $15 million (additional one-time funding) for 988 State Suicide and Behavioral Health Crisis Services Fund in 2023-24 to support 988 call centers, for total funding of $19 million in 2023-24 and $12.5 million in 2024-25 and ongoing for 988 call centers.

·         $500 million one-time Mental Health Services Fund in 2023-24 in lieu of GF for the Behavioral Health Bridge Housing Program, thereby eliminating the Governor’s Budget proposed delay of $250 million GF to 2024-25.

Department of Social Services

·         3.6 percent increase to CalWORKs Maximum Aid Payment (MAP) levels effective October 1, 2023, with an estimated cost of $111.2 million in 2023-24.

·         Reversion of approximately $280 million GF from 2021-22 from the CalWORKs Single Allocation. The Administration will engage with the counties that administer the program to determine the precise amount.

·         In-Home Supportive Services (IHSS) $60.7 million ($27.9 million GF) ongoing to increase access to authorized services and better serve the IHSS program’s minor recipients and their families.

·         Includes a six-month extension for the Home and Community-Based Services (HCBS) spending plan until September 30, 2024 for specified programs, such as the IHSS Career Pathways Program, to spend allocated funding based on critical programmatic needs.

·         Supplemental Security Income/State Supplementary Payment (SSI/SSP) continues to include $146 million GF in 2023-24 and $292 million ongoing for an additional, planned SSP increase of approximately 8.6 percent, effective January 1, 2024.

·         Foster Care and Child Welfare – $163.7 million additional ($83.4 million GF) for the Child Welfare Services-California Automated Response and Engagement System (CWS-CARES) Project

·         Continues to work towards implementing the California Food Assistance Program (CFAP) expansion for income-eligible individuals aged 55 years or older, regardless of their immigration status (this initiative is also called “Food For All”). The Governor’s Budget indicated that the program may begin food benefits issuance in January 2027.

·         $406.5 million ($159.5 million GF) to reflect a revised budgeting methodology for county CalFresh administration activities, pursuant to Chapter 537, Statutes of 2022 (AB 207).

·         $47 million ($23.5 million GF) for Summer Electronic Benefit Transfer (EBT) Program outreach and automation costs to phase in this program for children who qualify for free or reduced-price school meals beginning summer 2024.

·         $20 million General Fund in 2023-24, $20 million General Fund in 2024- 25, and $10 million General Fund in 2025-26 at the California Department of Aging to support the continuation of the Older Adult Friendship Line, a targeted media campaign for older adults, and competitive grants to local jurisdictions to build organizational capacity to identify and address older adult behavioral health and substance use disorder needs.

·         Includes a six-month HCBS extension until September 30, 2024 for specified programs, such as the Senior Nutrition Infrastructure Program, to spend allocated funding based on critical programmatic needs.