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State Budget/Education/Children

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Budget Highlights
Our friends at the NC Justice Center have compiled a comparison of the House and Senate budget proposal on various issues. Here’s a sample of some of the key issues affecting children.

Responding to Leandro ruling: The Governor and Legislature have responded to the Leandro public school litigation by allocating more money for Low-Wealth School systems and creating a new Disadvantaged Student Supplemental Fund. Additional funding for both of these programs is necessary to help all students who are not yet receiving a sound basic education.
· Low Wealth Supplemental Fund: House – $41.9m — Senate $0
· Disadvantaged Student Supplemental Fund: House – $0 — Senate $26.7m

Restore Past Cuts to Public Schools’ Budget: House $44.3m — Senate $44.3m
Both the House and Senate chose to restore cuts made in past years’ education budgets when there were inadequate revenues. These funds can be used as each school system determines without restriction. There was a long debate on the floor of the House about whether this money should be spent here or to meet the needs specified in Leandro for students at risk of failing. Since this item is in both budgets, however, it will no longer be in contention.
Child Care Subsidy: House – $14m + $16.6m (TANF funds) — Senate – $20m
There are over 30,000 children currently on a waiting list for child care subsidies and in many counties better quality child care centers are closing because their reimbursement rates have not been increased since 2000. The Senate allows funds to be used to increase subsidy reimbursement rates, but the House budget does not.

Mental Health Reforms: House – $99m — Senate – $104m
These funds are spent differently in each budget and the House allocates much more non-recurring (that is only available this year) money which means the system could fall further into crisis next fiscal year, or that providers simply will not take the money to start new services since it is not allocated for over one year. Neither budget allocates the $150m to meet needs identified by a legislative study commission on mental health reform.

Early Intervention Services: House – $14.3m — Senate $7m
The federal government restricted Medicaid funding so that it could no longer cover these services. The state either picks up the cost or these young children go without identification and services until they are older.

Foster Care and Adoption Services: House – $12m — Senate $12m
These funds are to cover the loss of federal monies for foster care and adoption services that county social services agencies have provided for years.

Medicaid Help for Counties: House – $18m recurring and $35m non-recurring — Senate $0
The House budget provides some long term aid — $18m — and one time help — $35m — to counties to help them cover their increasing Medicaid costs. Counties, especially low-wealth ones, cannot continue to cover their share of state Medicaid costs; however, that discussion cannot be separate from discussions about revising and modernizing the tax system since county and state taxes are as intertwined as their funding of Medicaid. The House provides some county relief, but did not include solutions for how the state will pay for this in future years.

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