June 1, 2017: IMPERIAL VALLEY WEEKLY - Supervisors Look At State Budget Impacts on IHSS

June 01, 2017


The Governor’s May revision budget takes a new look at In Home Support Services Maintenance of Efforts that had many counties concerned due to its potential elimination.

Back in March, the County Board of Supervisors sent a letter to Senator Holly Mitchell, chair of the Senate Budget and Fiscal Review Committee, opposing the elimination of this program. The Coordinated Care Initiative and its associated components were created by legislation in 2012. Subsequent legislation, required the Department of Finance Director to perform an annual calculation regarding the costs and savings related to the CCI, and to end the CCI should the state cost exceed savings, with notification within the Governor’s January Proposal.

On January 10, 2017, the DOF announced that pursuant to his calculations, CCI costs exceeded state savings by $42.4 million, thereby triggering the unwinding of the CCI and dismantling the In-Home Supportive Services Maintenance of Effort.

There was a change in the Governor’s January proposal to eliminate the IHSS Maintenance of Effort, which would have created an approximate $623 million cost shift to counties beginning July, 2017. The Governor’s revision on May 11, 2017, included a proposal of $1.1 billion in state general fund contributions over the next four years to mitigate the IHSS cost shift to counties.

The State contribution is broken down as such:
2017-2018: $400 million
2018-2019: $330 million
2019-2020: $200 million
2020-2021: $150 million

Counties that are experiencing hardships due to the increase IHSS cost may apply for a low interest loan with the Department of Finance.

Some of the key provisions of the newest proposals are that there will be a new MOE structure that includes services and administration costs with a new base and a new base and a new annual inflator that will vary based on fiscal circumstances. There will be no inflation applied in the FY 17-18 but there will be a five percent inflation factor in FY 18-19. In future years, the inflation will based on the 1991 realignment growth.
Collective bargaining will remain with counties, however, if a county does not conclude bargaining within nine months, the union may appeal to the Public Employee Relations Board.

“As you can see, the cost is still going to be shifted to counties, but there are funds that are being committed in order to mitigate the impact to counties for the next few years. Exactly how that will impact Imperial County, we don’t know yet and we won’t know until we get some additional information from the Governor’s office in order to do the calculations to estimate,” stated Rebecca Terrazas-Baxter, Intergovernmental Relations Director.

The governor’s proposal does not contain a commitment going forward to review the cost of the program with the new structure and the impact of the inflation factor.

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