State Spending Plan
October 2, 2018

The 2018-19 Budget

California Spending Plan (Final Version)

Chapter 2: Spending by Program Area

Human Services

Overview of Spending

The 2018‑19 spending plan provides nearly $14 billion from the General Fund for human services programs. This is an increase of $858 million, or 6.6 percent, compared to the revised prior‑year spending level, as shown in Figure 16. This is primarily the result of higher spending in the Department of Developmental Services (DDS) and the In‑Home Supportive Services (IHSS) program, largely reflecting new program augmentations in DDS and increasing caseloads, costs per consumer, and labor costs for both programs. Figure 17 shows the major policy changes adopted by the Legislature as part of the 2018‑19 spending plan. These changes are discussed in more detail below.

Figure 16

Major Human Services Programs and Departments—Spending Trends

General Fund (Dollars in Millions)



Change From
2017‑18 to 2018‑19



Department of Developmental Services





In‑Home Supportive Services










County Administration/Automation





Child welfare services










Department of Child Support Services





Department of Rehabilitation




Department of Aging





All other social services (including state support)










Figure 17

Major Actions—Human Services Programs

2018‑19 General Fund Effect (In Millions)




Creates new Safety Net Reserve and makes initial deposit for the CalWORKs program


Increases monthly cash grants by 10 percent, beginning April 1, 2019


Provides three‑year funding for new CalWORKs Home Visiting Initiative


Augments existing housing and homelessness programs within CalWORKs


Provides one‑time funding for county “single allocation” funding for employment services


In‑Home Supportive Services (IHSS)

Augments funding on a one‑time basis for IHSS administrative costs


Provides temporary funding to support planning for the federally mandated electronic visit verification system



Provides one‑time funding to eliminate the SSI cash‑out policy and establish a hold harmless program


Child Welfare Services

Provides additional resources for Continuum of Care Reform‑related county administrative activities


Expands eligibility for Chafee higher education grants for former foster youth up to age 26


Funds one‑time training and services to reduce foster youth interaction with law enforcement



Augments existing immigration services funding


Funds immigration legal aid services at California State University campuses


Food Assistance

Funds CalFresh fruits and vegetables pilot program


Provides one‑time grant funds for food bank infrastructure


Funds one‑time grants to food banks to operate diaper banks


Other Department of Social Services

Provides one‑time grant funds for services for Holocaust survivors


Provides one‑time grant funds for youth citizenship and engagement programming


Provides one‑time funding for Senior Home Safe program


Department of Child Support

Augments existing funds for local child support agencies


Department of Aging

Augments existing long‑term care ombudsman funding


Developmental Services

Delays enforcement of “Uniform Holiday Schedule” by one year


Augments funding on a one‑time basis for consumer transitions from DCs to the community


Provides one‑time “bridge funding” for service providers’ direct services staff


Increases rates for certain health‑related service providers to match Medi‑Cal rates


Funds deferred maintenance projects at Porterville DC


Provides augmentations for various DDS headquarters activities


Provides one‑time funding for Best Buddies Program


aThis funding is in a reserve and is therefore not reflected in the 2018‑19 budget for CalWORKs.

bReflects total General Fund support provided to the Department of Social Services, Department of Developmental Services, Office of Systems Integration, and Department of Health Care Services to support planning for the federally mandated electronic visit verification system.

cAdditional campus legal aid services funding provided as part of the University of California and the community colleges budgets.

dFunding for deferred maintenance is budgeted through Control Section 6.10.

DC = Developmental Center and SSI/SSP= Supplemental Security Income/State Supplementary Payment.


The spending plan provides a total of $5 billion (all funds) to support the California Work Opportunity and Responsibility to Kids (CalWORKs) program in 2018‑19, an increase of $30 million (less than 1 percent) relative to estimated spending in 2017‑18. The year‑over‑year increase primarily reflects the net effect of roughly $280 million in new programs (and augmentations to existing programs), which is offset by roughly $250 million in savings that result from declining caseloads. Within the total funding amount, the spending plan provides $373 million from the state General Fund for CalWORKs in 2018‑19, a decrease of $65 million (15 percent) relative to 2017‑18. The decrease in General Fund support for the CalWORKs program results largely from the availability of additional county realignment funds that are dedicated to paying a portion of the cost of CalWORKs grants. Major changes in CalWORKs funding and policy included in the 2018‑19 spending package are described below.

Monthly CalWORKs Grants Increased 10 Percent. The budget plan includes $90 million General Fund in 2018‑19 to support a 10 percent across‑the‑board increase to CalWORKs maximum grant levels, beginning April 1, 2019. (The budgeted amount corresponds to one quarter of the full‑year cost of the grant increase.) As displayed in Figure 18, the proposal will increase the maximum grant amount for a family of three with no other income by $71 per month, from $714 to $785. The administration anticipates that the full‑year costs of this proposal will be about $360 million General Fund annually beginning in 2019‑20. In addition to the 10 percent grant increase, the 2018‑19 spending plan includes budget‑related legislation with intent language to increase grant levels to achieve at least 50 percent of the federal poverty level for all CalWORKs families by 2021‑22 (including those families with an adult member who is not eligible to receive assistance).

Figure 18

Maximum Monthly CalWORKs Grant

Family of Three in a High‑Cost County With No Other Income

Grant Increase

Grant Increase








Grant as a percent of FPLb



aBudget legislation provides a 10 percent grant increase effective April 1, 2019.

bAnticipated 2019 federal poverty level (FPL) based on LAO estimate.

Future Cost‑Of‑Living Adjustments May Be Provided. The budget includes language that would adjust the CalWORKs grant based on annual changes to the cost of living, as measured by the California Necessities Index, beginning July 1, 2022. These adjustments would be subject to appropriation in future budget acts.

New Home Visiting Program. The spending plan includes $27 million federal Temporary Assistance for Needy Families (TANF) funds in 2018‑19 to begin a new home visitation program within the CalWORKs program. The spending plan also sets aside an additional $131 million in TANF funding to support annual costs of the home visiting program in future years. Under the new program, CalWORKs families with a child under two years old will be eligible to receive regular visits from a nurse, parent educator, or early childhood specialist who works with the family to improve maternal health, parenting skills, and child cognitive development. Counties will prioritize limited home visiting funding to provide home visits for first‑time parents under the age of 25. (Counties could also serve other families, but only insofar as funds are available.) Families could receive home visits for up to two years. As a condition of receiving program funding, county human services agencies that elect to participate in the program will be required to submit plans to the Department of Social Services (DSS) that detail how they intend to operate the county home visiting program. Participating families would be eligible to receive a one‑time stipend to purchase household items related to child safety.

New Safety Net Reserve With $200 Million Initial Deposit. The budget creates the Safety Net Reserve, which aims to set aside funds for the future expenditures of two programs: CalWORKs and Medi‑Cal. (These are programs that, during a recession, typically have increased expenditures as caseload increases.) The 2018‑19 budget plan deposits an initial $200 million in the CalWORKs subaccount and directs the Department of Finance to develop a methodology to calculate caseload savings in these programs and deposit a portion of these savings into the reserve in future years.

Updated Budget Methodology Results in Additional Funding for County Operations. Recent caseload‑driven reductions to county funding for CalWORKs administration and services—referred to as the “single allocation”—raised concerns that additional reductions for administration and services might lead counties to eliminate staff positions, reassign staff, or reduce some services. In light of these concerns, the 2017‑18 budget package required the administration to revisit the single allocation budget methodology. The spending plan is based on this new methodology to calculate the eligibility and administration component of the single allocation. (The administration plans to update the employment services component in the coming year.) The updated eligibility and administration component, which was proposed as part of the May Revision, is $593 million—$55.6 million above what was proposed in the Governor’s January budget.

The new methodology allocates to counties a base funding amount that does not change each year and a caseload funding amount that increases or decreases in years when the caseload increases or decreases by more than 5 percent. The base funding amount is set at 40 percent of average historical funding for the single allocation and will not change from one year to the next. Additionally, caseload funding cannot increase or decrease by a step of more than 5 percent each year, even if the caseload increases or decreases by more than 5 percent. Caseload funding will not change in years when the caseload is steady and does not increase or decrease by more than 5 percent. This new methodology is intended to have the effect of reducing year‑over‑year fluctuations in this component of the single allocation.

The spending plan also includes a one‑time $23.5 million augmentation to the employment services component of the single allocation. This has the effect of maintaining funding for this component at the amount provided in 2017‑18.

Expanded Funding to Support Programs for Homeless CalWORKs Families. The spending plan includes two actions related to assistance for homeless CalWORKs families. First, the spending plan augments existing funding for the Housing Support Program (HSP) by $24 million in 2018‑19 and by an additional $24 million General Fund in 2019‑20. Under the plan, overall funding for HSP will be $95 million General Fund in 2019‑20 and thereafter. Through HSP, participating county human services agencies help CalWORKs families who are homeless or at‑risk of becoming homeless find and move in to permanent housing. Currently, 49 counties participate in the program.

Second, the spending plan provides $7.6 million General Fund to increase the daily maximum voucher amount for the Homeless Assistance Program (HAP) payments from $65 to $85. The HAP provides daily housing payments to homeless (or at‑risk of becoming homeless) CalWORKs families that are used to purchase nightly housing accommodations (for example, in a hotel). Temporary housing assistance is available for up to 16 consecutive days each year. Payments are intended to serve as temporary assistance for families as they search for permanent housing. The daily rate was last increased in 2006 (from $40 per day to $65 per day). 

Fingerprinting Requirement Discontinued. As part of legislation associated with the 2017‑18 Budget Act, the administration discontinued the use of the Statewide Fingerprint Imaging System (SFIS) as a requirement for issuing CalWORKs benefits, effective July 1, 2018. Prior to the discontinuance of SFIS, in addition to the standard use of a photo ID to verify identity, adults applying for CalWORKs were required to have their fingerprints taken and matched against other applicants in order to prevent individuals from receiving duplicate cash aid. Going forward, the state will continue the existing process for verification, except without the use of fingerprint imaging. This means that adult applicants will continue the standard practice of providing a photo ID to initiate the application and eligibility determination process. The 2018‑19 spending plan provides $2.4 million to decommission SFIS.

In‑Home Supportive Services (IHSS)

The 2018‑19 spending plan includes $3.8 billion General Fund for IHSS, a net increase of about $370 million (10.7 percent) over revised estimates of 2017‑18 costs. The year‑over‑year net increase in estimated IHSS General Fund costs is primarily due to caseload growth and increased state minimum wage costs, which are partially offset by the scheduled decrease in General Fund assistance provided to counties. The major changes to the IHSS program include (1) a one‑time funding increase for IHSS administrative costs and (2) funding to support the planning and implementation of an electronic verification system in IHSS and other Medicaid‑funded programs.

IHSS Administrative Costs. The 2017‑18 budget included language that required the administration, in consultation with counties, to update the budgeting assumptions used to estimate IHSS administrative costs. Although the administration proposed a new budgeting methodology as part of the January budget proposal, counties raised concerns that IHSS county staffing costs may not have been fully captured. The spending plan provides an additional $15.4 million General Fund on a one‑time basis for IHSS administrative costs, totaling $268 million General Fund ($733 million total funds) for IHSS administration in 2018‑19. We note that the administration will reexamine the revised budgeting methodology for IHSS administrative cost as a part of the 2020‑21 budget process.

Electronic Visit Verification (EVV). Federal law enacted in 2016 initially required states to use an EVV system for Medicaid‑funded personal care services by January 1, 2019 and home health care services by January 1, 2023. In July 2018, the federal government extended the implementation date for Medicaid‑funded personal care services to January 1, 2020. Required functions of the EVV system include electronically collecting and verifying date of service, start and end time, and type of services provided—functions that the current systems in California are not fully equipped to do. Failure to comply with EVV will result in an escalating reduction of Medicaid federal funds for those services affected by EVV. While the administration is working with the federal government to request a “good faith effort” time extension (until January 1, 2021) to implement EVV in order to avoid the out‑year penalties for failure to comply with the set deadlines, the 2018‑19 spending plan provides resources for the planning and subsequent implementation of EVV across various departments.

Specifically, the 2018‑19 spending plan provides $949,000 ($559,000 General Fund) to support planning for the EVV system across the Department of Social Services, Department of Health Care Services, Department of Developmental Services, and Office of Systems Integration. The spending plan also includes budget bill language that (1) authorizes the Department of Finance to increase DSS’s state operations and local assistance resources by up to $1 million General Fund in 2018‑19 to develop and implement an EVV solution, (2) temporarily exempts the administration from creating regulations for the implementation of EVV—allowing it to instead implement EVV through all‑county letters in 2018‑19, and (3) proposes general principles to which the administration shall adhere to when implementing EVV.

Supplemental Security Income/State Supplementary Payment (SSI/SSP)

The 2018‑19 budget includes $2.8 billion General Fund for SSI/SSP, which is slightly—about 2 percent—lower than the revised estimates for 2017‑18. The decrease is primarily due to the expiration of one‑time funding for augmentations provided in prior years. We note that the 2018‑19 SSI/SSP General Fund budget does not include $220 million in one‑time General Fund provided to eliminate the SSI cash‑out and create a hold harmless program for households negatively affected by the policy change. (These funds are mainly displayed in the state budget for food assistance programs and county administration and automation, and are available to be used over multiple years.) The 2018‑19 spending plan includes budget‑related legislation potentially providing future cost‑of‑living adjustments (COLAs) to SSP grant levels.

Ending The SSI Cash‑Out Policy. The budget includes legislation that eliminates the SSI cash‑out policy—effectively making SSI/SSP recipients eligible for CalFresh food benefits. The implementation date is scheduled to be June 1, 2019. We note that trailer bill legislation allows for a delayed implementation date (no later than August 1, 2019) if the necessary automation changes are not completed by June 1, 2019. The administration expects that the majority of affected households would benefit from ending the SSI cash‑out. However, some households currently receiving federal food benefits are expected to experience a reduction in those benefits. As a result, the budget includes language that would establish a hold harmless program in the form of a state‑funded food benefit program for these households.

As previously mentioned, the spending plan provides $220 million one‑time General Fund (to be used over multiple years) for the necessary programmatic and automation changes to end the SSI cash‑out and implement the hold harmless policy. The budget includes intent language focused on the continuation of the hold harmless policy once the initial funds are fully used. We note that roughly $3 million of the $220 million allocated to end the SSI cash‑out will be used on an annual basis to increase Cash Assistance Program for Immigrants (CAPI) grant levels to SSI/SSP grants levels—an increase of $10 for individual CAPI grants and $20 dollars for couple CAPI grants—upon the elimination of the SSI cash‑out (expected to be June 1, 2019).

Future COLAs May Be Provided. The 2018‑19 budget includes language that would adjust the SSP portion of the grant based on annual changes to the cost of living, as measured by the California Necessities Index, beginning July 1, 2022. These COLAs to SSP grant levels would be subject to appropriation in future budget acts.

Department of Aging

The budget provides $36 million General Fund for the Department of Aging in 2018‑19, an increase of $2.3 million (6.8 percent) above 2017‑18. This increase represents an ongoing augmentation for the Long‑Term Care Ombudsman program—from $1 million General Fund in 2017‑18 to $3.7 million General Fund in 2018‑19. These additional funds would increase the base funding levels for all local ombudsman programs from at least $35,000 to at least $100,000 per fiscal year.

Adult Protective Services Housing Program

State law requires that each county have an adult protective services (APS) program to investigate reports of abuse and neglect of elders and dependent adults who live in private settings. County APS offices typically coordinate services such as counseling, money management, and out‑of‑home placement for the abused or neglected adult. The state is responsible for program oversight for APS, including statewide training of APS workers to ensure consistency. In 2011, the main programmatic and fiscal responsibility for APS was realigned to counties. APS is funded through a combination of state, county, federal, and 2011 realignment funds.

Establishes Limited‑Term State Matching Funds for County Senior Home Safe Program. The spending plan provides $15 million General Fund in 2018‑19 on a one‑time basis—available to be spent over three years—to establish the Senior Home Safe Program. Under this pilot program, state funding will be awarded to counties or tribes to provide housing‑related supports to seniors experiencing homelessness or at risk of homelessness primarily due to elder or dependent abuse, neglect, self‑neglect, or financial exploitation. Participating counties and tribes are required to provide a dollar‑for‑dollar match to receive state funds. Budget‑related legislation also requires an independent evaluation of the impacts of the program.

Child Welfare Services

Continues Funding for the Continuum of Care Reform (CCR). The 2018‑19 spending plan provides $205 million in General Fund to continue the state’s CCR efforts. Although this reflects a decrease of $44 million compared to revised spending in 2017‑18, it is higher than prior projections of 2018‑19 CCR spending. This higher funding level relative to previous projections, largely reflects lower projected CCR‑related saving rather than policy changes that result in higher CCR costs. For example, the spending plan assumes slower movement of foster children out of group homes and into lower cost, home‑based family settings than had previously been projected, which has the effect of increasing projected CCR spending.

New Policy Changes in CCR. The spending plan includes several major CCR‑related policy changes, which we describe below:

  • Ensures Funding at the Time of Placement for Emergency Foster Caregivers. Foster children can be placed with relative caregivers on an emergency basis before full foster caregiver approval is granted. (We note that children may also be placed on an emergency basis with unrelated adults with a close connection to the child.) When a child is placed on an emergency basis, the caregiver generally does not receive foster care assistance payments while the caregiver approval process is pending. CCR’s new foster caregiver approval process, Resource Family Approval (RFA), has taken longer than expected and delayed when emergency caregivers begin to receive foster care assistance payments. In response, in March, the Legislature passed and the Governor signed Chapter 8 of 2018 (AB 110, Committee on Budget), which authorized funding for foster care assistance payments at the time of placement on a temporary basis in 2017‑18. The spending plan includes a long‑term solution that provides funding for foster care payments at the time of placement on an ongoing basis starting in 2018‑19. The state will primarily utilize federal Emergency Assistance (EA) funding available through the Temporary Aid for Needy Families block grant to pay for these temporary payments. EA funding for these payments will generally expire after whichever comes first: (1) the foster caregiver completes the RFA process and begins receiving standard foster care assistance payments or (2) after six months in 2018‑19 and three months in 2019‑20 and beyond. In general, for emergency caregivers whose RFA remains pending after the specified time periods have lapsed, counties will be able, but not required, to use county funding for temporary foster care assistance payments until RFA is completed. The shorter time period in which funding is available after 2018‑19 reflects the state’s expectation that counties eventually will be able to reduce the time it takes to complete the RFA process.
  • Provides Additional Funding for County Administration. For 2018‑19, the spending plan provides $123 million in General Fund for county administrative activities related to CCR. Of the total, $11 million reflects an augmentation over the Governor’s May budget proposal, which will assist counties in (1) clearing an accumulated backlog of RFA applications that remain unapproved and (2) carrying out the new level‑of‑care assessment tool that will be used under CCR to determine foster care payment levels. The funding for the assessment tool will be ongoing, while the funding for the RFA backlog is expected to be one time.
  • Extends Group Homes as an Allowable Placement Option Beyond 2018. Under existing state law, group homes would no longer be an allowable foster care placement option after December 31, 2018 for most foster children. Instead, foster children could either be placed in a short‑term residential treatment program (the new congregate care placement option under CCR) or in a home‑based family setting. The spending plan temporarily extends group homes as an allowable placement option for foster children beyond December 31, 2018 for up to one year.

Expands Eligibility for Chafee Higher Education Grants. The Chafee Education and Training Vouchers Program provides grants of up to $5,000 a year for individuals who (1) were in foster care at some point between the ages of 16 and 18, (2) are less than 22 years old as of July 1st of the award year, (3) have a financial need, and (4) are attending qualifying career and technical training or college. This federal‑ and state‑funded program was established by federal law in 1999 and is administered in California by the Student Aid Commission through an interagency agreement with DSS. The program is intended to address the large disparity between foster youth higher education attainment rates compared with that of the general population. However, many former foster youth are unable to take full advantage of the program due to delayed college enrollment after high school or delayed training or degree program completion beyond the age cap. The spending plan provides the program with an ongoing $4 million augmentation from the General Fund to increase the maximum eligible age to receive Chafee Foster Youth Grants to 26 years old beginning in the 2018‑19 award year.

Establishes Programs to Reduce Foster Youth Interaction With Law Enforcement. Currently, law enforcement officers are called in response to behavioral incidents involving foster youth residing in many congregate care settings. A concern is that some of these calls are for relatively minor incidents that may not have resulted in such an intervention for youth who were not in congregate care. The involvement of law enforcement in these situations exposes foster children to the criminal justice system, which can lead to adverse outcomes for the youth involved. The spending plan requires congregate care facilities to develop protocols specifying the circumstances under which law enforcement may be contacted in response to behavior exhibited by resident children. These protocols must state that contacting law enforcement can only be done as a last resort and only upon approval of a staff supervisor. In addition, the spending plan includes $4 million one time from the General Fund for DSS to provide training for congregate care staff, law enforcement, and county personnel in order to reduce the frequency of foster youth involvement with law enforcement. The funding will also support community‑based services for foster youth in congregate care, including mentoring, educational enrichment, and self‑awareness and health programming among others.

Immigration Assistance

As shown in Figure 19, the budget plan includes a total of $31 million General Fund for new one‑time grant programs that provide legal services for immigrants. These programs are in addition to ongoing funding of $48 million for existing immigration services, administered by DSS. This total amount—$79 million—is $11 million greater than the one‑time and ongoing funding provided in 2017‑18. Below, we describe the new one‑time funding provided for immigration services as part of the 2018‑19 spending plan.

Figure 19

New One‑Time Funding for Immigration Assistance and Legal Servicesa

2018‑19 Budget Act, General Fund (In Millions)




Legal services for TPS recipients

Grants to nonprofit legal aid organizations to advise and represent current or former TPS holders.


Legal services at CCCb

Administered by DSS, legal aid services for undocumented community college students and employees.


Legal services at CSU

Administered by DSS, legal aid services for undocumented community college students and employees.


Legal services at UC

Potentially administered by the UC law schools. Legal services for undocumented students and employees.




aNew one‑time funding is in addition to $48 million ongoing for immigration legal services at DSS.

bCounts towards state’s Proposition 98 minimum education funding requirement.

TPS = Temporary Protected Status and DSS = Department of Social Services.

Immigration Services Augmented on One‑Time Basis. The Immigration Services Funding program within DSS provides grants to nonprofit legal aid organizations to provide various legal services. These services include (1) assisting individuals applying for naturalization, deferred action, and other immigration remedies; (2) conducting outreach and education in immigrant communities; and (3) providing legal defense for individuals subject to deportation proceedings. A total of $65 million General Fund was provided for these services ($45 million ongoing) as part of the 2017‑18 budget. (An additional $3 million has been provided in recent years for legal representation of unaccompanied undocumented minors.) The spending plan includes a one‑time augmentation of $10 million for immigration services specifically to be used to provide services to unaccompanied undocumented minors and for recipients of Temporary Protected Status (TPS). Under TPS, the federal government provides temporary refugee status to immigrants of certain countries that have experienced armed conflict, a natural disaster, or other extraordinary circumstances.

Immigration Services for College and University Students. The spending plan designates new, one‑time funding of $21 million General Fund to provide immigration services for students, staff, and faculty at the state’s higher education segments—the community colleges ($10 million), California State University (CSU) ($7 million), and the University of California (UC) ($4 million). The community colleges and CSU are to provide these services to students, staff, and faculty via an existing immigration services grant program at DSS. Specifically, DSS would use these monies to contract with several dozen nonprofit organizations that provide legal aid services under the state’s existing Immigration Services Funding program. As discussed above, grant funds would be used to provide legal consultations and legal representation. Regarding the UC portion, at the time of budget enactment, the UC had not yet determined whether they would provide legal aid services through their law schools or if they would also provide these services via DSS’ existing grant program.

Food Assistance

CalFresh Fruits and Vegetables Pilot Program. The spending plan provides $9 million General Fund to conduct a three‑year pilot project in which CalFresh food assistance recipients will be eligible to receive one dollar in additional food benefits (that could be used for any CalFresh‑eligible food item) for each one dollar purchase of California‑grown fruits and vegetables. The pilot will be tested in at least three locations statewide. Additional food benefits generated from the purchase of fruits and vegetables would be automatically added to the individual’s electronic benefit transfer card.

Food Bank Infrastructure Grants. The spending plan includes $5.5 million General Fund on a one‑time basis for grants for community food banks to make infrastructure improvements, such as the purchase of refrigerated storage, vehicles used for food distribution, warehouse equipment, and technology systems used for inventory management.

Providing Diapers to Low‑Income Families. The spending plan includes $10 million General Fund to provide one‑time grants to four large food banks to operate a temporary program to supply low‑income parents with diapers.

Department of Child Support Services

Funding for Child Support Services. The 2018‑19 spending plan provides the Department of Child Support Services (DCSS) with $319 million General Fund, an increase of $3 million (1 percent) relative to revised estimates for 2017‑18. This increase is due to a $3 million ongoing General Fund augmentation to local child support agencies. Budget language requires that DCSS work with the Child Support Directors Association of California (CSDA) to determine an allocation schedule for the augmentation. Counties that receive these additional funds are required to report annually on child‑to‑staff ratios, total collections, cost avoidance benefits, and number of families served. In addition, the 2018‑19 spending plan includes budget‑related legislation requiring DCSS, in collaboration with CSDA, to submit a report to the Legislature by July 1, 2019 on programwide operational efficiencies and proposed refinements to the current budgeting methodology for the child support program.

Department of Developmental Services (DDS)

The spending plan provides $4.5 billion from the General Fund ($7.4 billion total funds) to support DDS in 2018‑19, an increase of 8 percent from $4.2 billion General Fund ($6.9 billion total funds) in 2017‑18. The year‑over‑year increase is largely the result of caseload increases, changes in service utilization, and costs associated with scheduled increases to the state minimum wage. The spending plan also provides several policy augmentations that together comprise around $100 million in new General Fund spending.

Delays Enforcement of 14‑Day Uniform Holiday Schedule. The spending plan provides $29.3 million from the General Fund ($48.3 million total funds) to delay enforcement of the 14‑day “uniform holiday schedule” by one year. This policy—first enacted in 2009 as a recessionary budget solution—prohibits service providers from billing for services on 14 predetermined days each year. This means that providers either do not provide services on those days or absorb the cost of doing so—resulting in General Fund savings. The 14‑day policy has not been enforced since 2015 due to litigation brought by service provider associations. Because a 2016 court ruling ultimately upheld the state’s policy, the Governor proposed to start enforcing it again as of July 1, 2018. A legislative compromise was reached with the Governor, however, to delay enforcement for one year, meaning that for 2018‑19, the state will not prescribe a set holiday schedule.

Augments Funding for Consumer Transitions From Developmental Centers (DCs) to the Community. DDS is in the process of completing the final phase of a decades‑long transition from an institution‑based system of service delivery to a more integrated community‑based system. In December 2018, it will close Sonoma DC, which opened more than 125 years ago. The department will also close Fairview DC and the general treatment area of Porterville DC by December 2021, at the latest. The secure treatment program at Porterville DC will remain open indefinitely. Although the state is expected ultimately to save money by closing DCs and serving individuals in the community, it has incurred significant costs during the transition. These costs include (1) developing resources in the community to serve former DC residents, (2) creating a community‑based safety net to replace DC‑based safety net services, (3) covering the transition costs of moving residents into the community, (4) facilitating closure of DC facilities, (5) providing bonus incentives to retain DC staff who care for the remaining DC residents, and (6) offsetting the loss of federal funding at the DCs. The spending plan provides $26 million one‑time General Fund ($30.6 million total funds) to support the transition costs of consumers expected to move from Sonoma, Fairview, and Porterville DCs in 2018‑19. This is in addition to $43.9 million General Fund ($67.9 million total funds) in “base” community placement plan funding that has historically been provided each year.

Provides “Bridge Funding” for Service Providers. The spending plan provides $25 million from the General Fund ($40.2 million total funds), available over two years and conditional on receiving federal approval for matching funds, for the wages and benefits of service provider staff that provide direct services to consumers. The bridge funding is one‑time as DDS and the Legislature await findings and recommendations from a three‑year rate study scheduled to be completed by March 2019. It is meant to increase funding for service providers until any recommendations from the rate study can be implemented. Budget bill language gives DDS and the Department of Finance flexibility in how to implement and allocate funding.

Increases Rates for Certain Health‑Related Service Providers. The spending plan provides $17.7 million from the General Fund ($30.1 million total funds) in 2018‑19 to increase certain service provider rates to match rate increases in the Medi‑Cal system. Of the total General Fund increase, $17.1 million is for home health providers, while $351,000 is for pediatric day health care providers and $202,000 is for providers at intermediate care facilities‑developmentally disabled (ICF‑DDs). Within the DDS system, certain rates are determined by the “schedule of maximum allowances,” which are Medi‑Cal‑set rates. Because the rates for these three services were increased in the Medi‑Cal system, the spending plan provides funding to increase the rates DDS pays for these services.

Provides Funding for Deferred Maintenance at Porterville DC. The spending plan includes one‑time funding of $10 million from the General Fund, available over three years, for deferred maintenance projects at Porterville DC. Although the final selection of projects is yet to be made, DDS will focus on the areas of Porterville DC that serve the secure treatment program, since it will remain open indefinitely. (The $10 million for DDS is part of a one‑time General Fund allocation of $305 million for deferred maintenance projects at 20 state departments. For more details on this allocation, please see the “Other Provisions” section of this report.)

Adds Language Related to Self‑Determination Program (SDP). One of the more significant policy changes in DDS that will occur in 2018‑19 is implementation of SDP. Chapter 683 of 2013 (SB 468, Emmerson) authorized SDP, with an initial three‑year phase‑in period, but made implementation contingent on approval of federal matching funds. The state just received federal approval on June 6 and the spending plan contains both budget and trailer bill language related to the rollout of SDP. Budget bill language allows DDS to shift up to $2.8 million General Fund from the Regional Center (RC) budget to DDS state operations for the administration of SDP. Trailer bill language specifies how some of the federal matching funds generated by SDP should be prioritized for participant training and person‑centered planning.

SDP represents a fundamental shift in how consumers receive services and supports through the DDS system. It allows consumers and their families to decide which services and supports they need and prefer by allowing them to direct the process by which such decisions are made. Statute stipulates that SDP must cost the same or less for each participating consumer than what is currently spent through the traditional services/supports delivery system. RCs will still be involved in determining the total amount of money available to each consumer, ensuring that consumers work with an approved financial management service to manage their money, and ensuring that consumers are only authorized to purchase allowable services and supports (for example, services and supports that are eligible for federal matching funds). SDP will ultimately be offered to anyone in the DDS system, but it will first be phased in over three years with up to 2,500 consumers representing all 21 RCs.