Senate Budget and Fiscal Review Subcommittee No. 3 on Health and Human Services

We're already, I'm going to ask for someone to order pizza later on to keep us going, but looking forward to some new proposals we'll hear today, some exciting news we'll get to talk about and then some not exciting news that I'm not looking forward to talk about, but it's very important. So let's get it started. We have, as always, a couple of panels that will help us guide the conversation. And we're going to start off with Governor's proposed cuts to child welfare. Welfare programs.

I'm going to ask the. Jennifer, I said I'm not going to say anyone's name. You're going to have to introduce yourselves because I keep butchering it. We're going to have the Department come on up, please. Department of Finance, LAO and then I'm going to ask because we don't have enough chairs for all the panelists. I know some panelists are splitting their time between another person. I'm going to ask that JBAY, the first speaker come up.

The first speaker for LA County Department of Children and Family Services come up. The representative from San Francisco County. And I'm not sure if we'll have room from anyone else. So JBAY, LA County DCFs, Foster to Adopt Parent, California Youth Connection. We might have room for everyone then, huh? Okay, then. Okay. If you're on this panel, you may come forward. Great. In Chief Deputy Director have you kick us off.

Thank you. Good morning. Jennifer Troia, on behalf of the Department of Social Services, you've asked us to kick off this morning talking about the proposals to eliminate funding for the family urgent response system referred to as FURS, the supervised independent living placement supplement, and the LA public health nursing program. In the case of the SILP rate, I'll also address how the proposed funds, foster care rate reform invests are in the SILPs.

I appreciate your questions about these proposals and your recognition that all of our programs at CDSS impact people experiencing need or vulnerability. So any proposed reductions are very difficult. The choices that we are facing as the Administration and the Legislature in light of the state's fiscal situation, are indeed very difficult. And ultimately we'll be subject to the final negotiations of the budget process. You asked about the anticipated effects of the proposal to defund fers.

As a reminder, FURS provides crisis supports in the form of a 24/7 statewide hotline and in person county mobile response units. Annually, the hotline receives around 5000 calls from current and former foster youth caregivers and other community supporters. What we would emphasize is that those individuals would need to utilize other resources, such as those provided by their health plans or those that are publicly available in lieu of utilizing FURS.

While we acknowledge that these resources are not specific to foster youth and their caregivers, it might be helpful to point out that they could include resources like Cal Hope, which provides free supports to individuals in crisis. And within Cal Hope there's a program called Bright Life Kids, which provides mental health coaching and resources for parents of children ages zero to 12, or resources like Saluna, which provides confidential support like coaching and resources from the Department of Healthcare Services for children and youth ages 13 to 25.

Moving to the SILP supplement the SILP supplement was adopted in 2023 to better align the SILP rates with county's fair market rents. The supplement has not yet taken effect and will require automation before it does so. So presently, youth and sops receive funding equal to the level of care basic rate under the reimbursement rates of current law, so $1,206 per month. The supplement was budgeted to cost around an additional $19 million in General Fund resources.

It's based on a calculation of the difference between fair market rent for a two bedroom apartment and 30% of that basic rate under current law. While the Governor's Budget's no longer proposing to fund the SILP supplement in the out years, our budget does propose significant investments in SILP rates, along with other rates in the permanent foster care rate structure proposal, which we'll be talking about on the next panel.

The proposed SILP rates under the governor's proposal become $1,788 for care and supervision and another 500 for strikes building, so the total is 2288. As a reminder, under the present system it's 1206. The proposed additional investment in SILP rates under the Governor's Budget is approximately $33 million.

General Fund so for the vast majority of youth living in SILPs, the SILP rate under the governor's proposed rate reform is a significantly larger benefit than the current SILP rate plus the supplemental and the final topic is the LA County Public Health Nursing Program. The enacting legislation for that program identified us at CDSS as the state agency responsible for passing through General funds to LA County to create this prevention program.

We don't have more active involvement in our oversight in the program, but the statute does specify how the funding is to be used, including for hiring public health nurses, supervisors and support staff. To date, we've received five invoices for a total of around $600,000 in this program. Under the Governor's Budget proposal, LA County would need to identify alternative funding sources to support the work that they began in 2023 through that funding or to reduce the services being provided. With that I'll conclude, but I'm happy to answer questions at the appropriate.

You mentioned, I think, three programs that could be replacements for FURS Cal Hope. Was it bright lights?

Yeah. Bright life is a part of Cal Hope, and I again want to acknowledge that they are not directly targeted only at foster Youth and caregivers in the way that FURS are. They're more generally publicly available, but they do provide resources. So it was bright, bright life hope or bright Life kids, which is a Cal Hope program. It's mental health coaching and resources for parents and children ages zero to 12 Saluna, which is confidential support, coaching and resources for teens and youth up to age 25. And Cal Hope is a hotline more broadly.

Do you know if these are 24/7.

Yes, Cal Hope is 24/7 it is operated by the Department of Healthcare Services. So I can do my best to answer any other questions you have about it.

One last question on that one. Do you know, since its 24/7 do you know if they have to go to a brick and mortar type of facility or they can call.

It's a hotline.

It's a hotline. Okay, thank you. And then on the third question for the LA Public Health Nursing Program, did I hear correctly that LA has spent approximately 600,000 of it already?

So they would have to find funding to cover that, because the proposal is not to cover that. Okay.

Correct.

Correct.

Okay, thank you. Our next speaker, Department of Finance. Would you like to add anything to that?

Marlon Davis, Department of Finance. The Governor's 2024-25 budget proposes various solutions in order to address the state's budget deficit. The agenda outlines the three budget solutions proposed in the child welfare policy area, and all three cases of solutions reflect difficult decisions in order to achieve a balanced budget.

Despite these solutions, the Administration remains committed to the well being of children's in the child welfare system, as reflected in administration's proposal to establish a new permanent race structure for fossil youth, as Jennifer already spoke about, which is in the next agenda. And we look forward to continued discussions with the Legislature on how we can adopt a balanced budget.

Mister Davis, I'm wondering. There are very few programs that the Administration proposed for complete cuts eliminated except for child welfare and cowworks. We're very unique in the matter that these are almost the only areas that have complete elimination. Do we? I feel like your backup is coming to be able to answer that one. I just wonder why it's so unique that it's just these areas that are being proposed for just complete elimination.

I get your point that at the same time, simultaneously in the next topic we're going to be hearing about this wonderful rate reform or the intent is really wonderful, but not all of it will cover some of the cuts that we're proposing. Was there anything else considered in that thought process?

Good morning. Kia Cha, Department of Finance. So I think for these specific proposals we are proposing reduction, ongoing reductions to really help address the budget deficit in the out years. Because as you are aware, it's not only just like in the budget year, but the following several fiscal years are also projected to have budget deficits.

I recognize that. I guess I should rephrase my question. I know we need to make cuts for ongoing for the next couple of years because I don't want to pass the bug to my future self since we'll have to address that problem in the future. With that in mind when we're looking at what we need to cut permanently to address now and future years, why was it unique that child welfare and cowworks were one of the only ones that got permanent cuts?

When we're deciding on what to permanently cut to save dollars, why is it like the gentleman in here with this pin, why these cuts and why these kids?

I would just say that these reductions are part of the Administration's approach to address the budget shortfall. But we recognize these are difficult cuts and it's proposed, it's not final. We look forward to engaging with you guys on alternatives that you guys might have to help address the budget deficit.

Okay. Because in my head I'm just picturing it's like we're blindfolded, there's a donkey and we're just putting the pin on what we want to cut. Just trying to make light of this difficult situation here. Thank you so much for your response. Okay. We're going to move on to now. Elle.

Good morning. Angela Short with the Legislative Analyst Office. Before diving into a few specific comments, I'll start with just some General comments which are, I think, reinforcing themes that have already come up in this hearing. As the Subcommitee is keenly aware the Legislature is facing a very difficult budget situation this year, and likely more difficult choices will need to be made in in future years, given projections of ongoing budget deficits in the out years.

The Governor's Budget presents one combination of solutions proposed to address the estimated budget problem. However, the Legislature very well may have different priorities in terms of making reductions, using reserves, and otherwise taking actions to help address the budget problem. As you just noted, Chair Menjivar, we would also underscore that we found it notable that across the Governor's Budget, there are very few proposed reductions to established ongoing programs.

The proposed cuts to CalWORKS and the child welfare programs we're discussing today do appear to be unique in that way. That said, at may revision and in final budget discussions, most likely ongoing reductions will need to be made to some programs across the budget. But again, the Legislature may have different priorities in terms of where exactly to make those cuts and how to balance programmatic reductions with other budgetary solutions.

That said, I'll jump into just a few specific comments about the individual reduction proposals here for child welfare. First, in terms of funding for fers, we would note that counties to date have not been fully expanding their allocations. This could in part be because the program has been ramping up beginning in 2019 to 20, of course, corresponding with the COVID pandemic period. Therefore, it might be a little bit of an anomaly.

But even in the current year, we based on the information we have, it does that counties are not on track to fully expend their allocations. Therefore, the Legislature may wish to consider possibly reducing funding for fers, rather than fully eliminating funding, if that could be possible without negatively impacting intended beneficiaries. We would also note that expenditure trends are, of course, different across counties. Some counties have been spending more of their allocations than others, so that would be something to take into consideration.

The Legislature may also wish to work with the Department to better understand what is causing this underspend. Have there been particular implementation challenges, or just, in other words, what is happening? Basically, that the full 30 million General Fund has not been expended to date. Second, in terms of the SILP housing rate supplement, as you heard from the Department, this issue very much interacts with the administration's proposal for the new permanent foster care rate structure.

So I think we'll probably get into more of that in the next issue. But just flagging that interaction. While the reduction of the current rate supplement proposal is included in the Governor's Budget, there would be new augmentation for sole funding included as part of that rate supplement supplement. It's not exactly one to one, but there is that trade off there.

And then finally, regarding the Governor's proposal to eliminate the housing navigators program, we recognize this is not under DSS, so the Department likely would not be able to speak to this today. But we did just want to flag, our understanding is that county child welfare agencies do use funding from that program to, or I should say some of that funding from that program to fund federally required case management services for former foster youth who receive federal housing vouchers.

Therefore, we would flag that eliminating the General Fund resources for that program could ultimately result in a loss of federal dollars and federal housing vouchers for those youth. I'll stop there and happy to help answer any questions. Thank you.

Angela. Do you have any comments on the LA Public Nursing Pilot Program?

For that program, we would note, I mean, as you've heard, it's been slow to ramp up. Again, in part, this was because of the COVID pandemic period. You know, ramping up a public health nurse program when public health resources needed to be focused and dedicated to the pandemic certainly was achieved. Challenge. That said, the program, you know, has spent less than $1 million to date with an annual allocation of 8.3 million. General Fund.

I think we would also note this program was intended to be a pilot, but we have provided, or in the past, in past budgets, we have provided ongoing resources. So again, it could just be something for the Legislature to consider, you know, whether to continue to prioritize General Fund resources during a very difficult budget situation for such a program.

Thank you, Chief Deputy Director. If the SILPs enhancement were to move forward, when would be the earliest we could see those?

The rates proposal is not expected to take, take effect until 26-27. So that's because of automation guidance, a number of things that are involved in the complexities of implementing the new rates. But again, I would emphasize that the supplement is also not currently in effect.

So even if we, even if we were able to put that back in, when would we see the rate reform kick in? That includes increases to SILPs.

That's what I'm talking about taking effect in 26-27.

So let me rephrase that. So without the rate reform implementation part out of it, just, if we're just looking at

The SILP supplement. Oh, I see. I think the SILP supplement, Angie, is 25-26.

Well, we haven't started automation yet.

We need to automate first. Right. The original plan was 25-26 in light of the Governor's proposal, proposal that automation has been a little bit paused. So I think we would have to reassess whether we would still be on track for 25-26 or whether there would be.

But potentially at the start time, as the same, as the rate reform.

The same or just a little bit earlier.

Yes. Okay. Okay. Okay. All right. Moving on to our Advocate from John Burton Advocates for Youth, who is.

It wasn't light up. Good morning, not afternoon. My name is Simone Tureck Lee with John Burton Advocates for Youth. I'm here to ask you to preserve, ask the Committee to preserve the supervised independent living placement housing supplement in the state budget. The SILP housing supplement. It would increase monthly payments that foster youth received who are placed in silps, and it would base that increase on the local cost of housing. The SILP housing supplement was established last year and is due to take effect in 2025.

As we just said, pending automation changes. As background, the SILP is the only placement where youth identify and secure their own housing and where they receive their monthly foster care rate directly, which is currently $1,206 per month. This rate is intended to cover food, clothing, shelter, school supplies, personal incidentals and reasonable travel. As you can imagine, $1,200 a month doesn't cut it in most of our state to cover those costs. These are youth who are often their own head of household.

They are not joining a caregiver's home, leveraging the existing utility Bill, meals, transportation, et cetera. They're covering all these costs on their own. The SILP housing supplement was adopted last year for three key reasons. 1st, $1,200 is not enough to achieve stable housing. At this rate, foster youth are living in deep poverty on an annual income of less than $15,000 a year.

This is a reason that 81%, or, excuse me, there is a reason that 81% of 18 and 19 year olds in the General population live with their parents. We have an extremely challenging housing market in our state. Second, it's not an equitable approach to have a statewide uniform rate for a placement where youth are navigating the rental market as head of their own household with the vast range of rental prices across California's 58 counties.

Third, these are youth we have a current legal obligation to, no different than minor foster youth. One in five of them experience homelessness between 18 and 20 while in care, putting them at heightened risk for chronic adult homelessness. We would not accept this for our own children. Now, with CDSS's proposed foster care rate reform, is the SILP housing supplement still needed? Yes, it is.

While the proposed foster care rate reform would raise the care and supervision rate paid to youth in SILPs from 1206 to 1788, and that is progress. And that's monthly and starting in 2026-27 that is still not adequate in the vast majority of California's counties according to fair market rent and affordable housing standards, and is less than the self housing supplement would have provided them as it stands in current law.

Before I close, I do want to mention a second investment in our state's budget, also proposed for elimination, that prevents homelessness among these same young people after they leave foster care, the housing navigation and maintenance program mentioned by LAO just now. It's not under the jurisdiction of this Committee, although I was asked to touch on it because of its relevance. This is a small state program, $13.7 million, administered by the Department of Housing and Community Development, two county child welfare agencies.

It plays a critical role in helping us access $22.6 million in federal housing assistance from HUD. The Housing Navigation and maintenance program funds the services provided to former foster youth with federal housing vouchers. These services are both necessary in order for a young adult to turn a voucher into actual housing and are federally required to even request vouchers.

In closing, we respectfully ask the Committee to preserve the SILP housing supplement by tying it to the new SILP care and supervision rate, and we ask for a recommendation to your fellow Senators serving on Subcommitee four to preserve the Housing navigation and maintenance program. Just want to share one last thing.

You're cutting into your time

My name is Wednesday Pope and I am a former foster youth and currently a student at Folsom Lake Community College. When I was in extended foster care, I experienced homelessness for a year while placed in a supervised independent living placement, or SILP. When I first turned 18 back in 2018, a SILP was my only option. There were waiting lists for transitional housing placements and no foster family options available. When you're placed in a SILP, you are required to find your own housing.

So I first tried finding people I knew that I may be able to live with as my SILP. What I found is that there was no one in my circle that I could trust to obtain safe and stable housing with at that time. Back in 2018, the monthly foster care payment for youth in SILPs was $960. Given the cost of apartments, I first looked for room rentals but found that I didn't feel safe in any of those arrangements.

I tried apartment rentals and found that I didn't meet the income requirements for them despite both working and receiving my silt payment. I then searched for apartments that didn't have income requirements, but found that they were requesting a 700 or better credit score plus rental history. Between income and other requirements requirements I, like most other foster youth and frankly, most other 18 year olds, could not qualify. My saving grace was that I was lucky enough to own a car.

I figured living in my car would be safer than living in some of the arrangements I may have been able to afford, such as renting a room from a man who placed an ad for an 18 to 25 year old roommate and said he didn't like closed doors in his house. I want to emphasize this point. After being removed from my home for not being kept safe, I shouldn't now be faced with a living arrangement that feels just as as unsafe.

So I lived in my car for a whole year while in foster care. Living in rural communities, we don't have accessible homeless shelters. So at least owning a car, you're not freezing at night, you can still get to work or school. Maybe you can get to a friend's house who will let you stay for a night or shower. My social worker didn't know I was homeless.

I feared that if I told her I didn't have housing, I couldn't get my SILP payment and then I would have been in an even worse situation. I wish I could say this was a rare occurrence, but many of the other foster youth I knew were also facing this reality. If the SILP housing supplement was in place when I was in foster care, I would have had a higher monthly payment that would have enabled me to secure, safe, stable housing.

I could have avoided the re traumatization of being homeless while in foster care. After having already experienced it with my family before being placed in care, I could have stayed in college full time. I would be further along in my pursuit of a career. I'm encouraged by the possibility that the sale rate will increase from the $1,206 it is now to the $1,788 proposed and rate reform. But unfortunately, this does not address the range of housing costs across our state's 58 counties.

As a former foster youth who experienced the impact of an inadequate monthly payment to cover shelter, I strongly recommend that the Legislature preserve the silp housing supplement. Thank you.

Thank you so much. Once I appreciate your testimony. Now we're going to turn over to LA County DCFS. Just being mindful that you're splitting your time with your colleague there.

Thank you. Good morning, Madam Chair and Members. I'm Gabriel Skydancer, the Fers manager for Los Angeles County's Department of Children and Family Services, I am requesting and representing this time for Los Angeles County Board of Supervisors. FURS is a unique entity that provides 24/7 support to foster kids and non minor dependents up until the age of 21, as well as their caregivers and their families emphasis on 24/7 and all hours of the day.

FURS is also available to foster kids who are out of the system for any reason, even if they have been put into legal guardianship, adoption, Kin gap, closed cases FURS is a program that simply does not exist anywhere else in foster care system. When a kid or caregiver calls us, they are almost always in great need. They have an urgent and immediate need for resources related to anything from stress management, job interviews, preparation for other critical needs in housing, suicide and homelessness in LA County.

I am the person on the other end of those calls, so let me tell you what happens next. No matter the time of day or night the call is received, FURS responds to that caller typically within 1 hour and no more than three. And by respond, I mean heading out to meet the family in person to offer support, stabilization, conflict management and more. You can imagine how challenging this is as a county as large as LA County. However, it does not stop there.

We also have mandatory follow up case maintenance for days extending to weeks and sometimes months after the call to ensure our kids feel families have received all the help that they need. If FURS was not there, these calls would be going to 911, law enforcement or fire, creating much more havoc for foster kids and families who are already dealing with instability and trauma.

For every call that comes in, there are one to two FURS employees coming out to help these families, instead of two to four police officers or four to six emergency responders. Additionally, many of our families are from the communities that formed a bias against authority. So without FURS they would not have anyone to call and wind up in a disastrous situation where they can reach out to no one.

It's life changing for them to know that they can call FURS anytime and there will always be someone like my phenomenal team responding to them in person, any time of night, any neighborhood, and they're going to come. Trauma informed, judgment, free help without bias and with an open heart. I am proud and humbled to inform you that LA County FURS has an unparalleled success rate. We account for over 25% of all mobile responses in the state.

We are right now at 87% success rate for keeping kids in the safe, in their homes and stabilization without having to go back into the system. FURS is so much more than a hotline. It saves the state from the strain that would be placed on police, fire and other non foster related resources if we were not there. More importantly, first protects kids from the compounding issues of trauma and moving in and out of the foster system.

We keep them safe and out of shelters and out of the streets and giving them stability they need. On behalf of Los Angeles County Board of Supervisors, I urge to not agree with these budget reductions.

Thank you. Now turning it over to a representative from Children's Medical Services, LA County Department of Public Health.

If it's registered.

Thank you, Chair Menjivar, Senator Roth, staff and colleagues my name is Craig Vincent-Jones. I'm the Deputy Director of children's medical services in LA County's Department of Public Health. Thank you for the opportunity to speak about our program, Public Health Nursing Early Intervention program, which we refer to as PHNEI. I will address the expenditure rates that came up in questions in a couple of moments, but I'd like to just offer a little background of why this program came into place in the first place.

PHNEI is a new program model piloting public health nursing interventions to keep children and youth out of or returning to the child welfare system. Recognizing that children and youth face myriad seen and unseen health access barriers and healthcare challenges when they are in the child welfare system and their child's medical complications can fully destabilize the family, CMS's child welfare public health nursing programs help children and families address their healthcare needs during their child welfare involvement.

In fiscal year 17-18, the Legislature approved a pilot project to expand those child welfare public health nursing services to children and youth at imminent risk of entering the child welfare system or those who have just left the child welfare system and are at risk of returning to it.

This innovation will help break the cycle of children and youth who repeatedly enter and reenter the child welfare system, and it was intended to be a model that could be broadened across the state if successful. PHNEI is closely aligned with La County's significant investment and commitment to families first strategies, and I can give you some of those examples. But in brief, plans of safe care could refer into PHNEI.

Referrals that don't turn into investigations could be referred into PHNEI and we could help divert those families into PHNEI driven solutions that will help them avoid entry into the public health or into the child welfare system. Per statute, PHNEI was going to be financed through an annual 8.25 million state General Fund allocation from CDSS, which would be used as a base for a federal matching title 19 funding strategy that we've been developing with DHCs.

That funding strategy could yield three to four times more revenues and services in future years. Due to the pandemic has been noted, program implementation was delayed until we got our first CDS allocation late last fiscal year. Since then, we installed our first staff, began building our data system, determine referral pathways with partners, assigned our first cohort of 12 nurses to the program, and begin recruitment for twice as many more.

Sadly, with the news of the Governor's proposed budget cuts we had to stop recruitment and move the initial nursing staff into other public health positions. So I'll address the 600,000. As I'm sure everyone understands, you don't start a new program, a fully new program, from ground zero to 100%. So we have a ramp way for the county. We were moving at light speed. We had positions and we made positions available very, very quickly, much faster than. Than usual county operations.

We had planned to begin our first staffing and services in January. That's when the budget cuts were announced. We had to, because we have an obligation to our staff, we had to move them into other positions. We are expending more than 600,000. We're still working with our consultants to finalize the protocols. We never expected in the first year to expend the full 8.25 million. But we do expand and have budgeted appropriately for fully expending that when the program is launched fully.

So we're here today to urge you all to advocate for the restoration of the annual 8.25 million in the next fiscal year's budget and to invest in promising solutions that we can explore together to help families steer clear of the risk that jeopardize repeated and further child welfare involvement. Thank you.

Thank you so much. Chief Deputy Director. Is this was an annual allocation or I hear pilot. I always think that's short lived.

There we go. It's correct that it is an annual allocation, as the LAO referenced earlier. There is pilot in the name. At the same time, there was an intention after the initial year that it was implemented, we did express an intention mutually, to have that be ongoing. So it is referenced as a pilot, but there was an intention for ongoing funding.

Is there room for. Well, I mean, we're looking at years. We want savings, but for delay.

I think I would sort of defer to the County on what they would do in the delay.

That's a great question. We are continuing to plan for full implementation in hopes that if it doesn't happen next fiscal year, that there will be a future in which we can launch the program properly.

And we have worked out a finance strategy for DHCs. I know that's another Department for the title 19 matching funds. So that would greatly enhance what we could accomplish with this program.

Okay, thank you. And then, Mister Skydancer, you heard from the Department some potential replacements that provide similar services to fers. I don't know if you've heard any of them. Do they exist in LA County? Are they. Would you say that they're.

There we go. I'm sorry, I'm not trying to build the suspense on you.

I know it seemed like it.

No, I'm here. I'm here to illustrate that, yes, I have heard of some of these programs, but honestly, with over 20 years of experience in this area and knowing how unique FURS is and exists in no other element, nothing can replace this. There's no program that can kind of supplement or tag team in to provide what FURS is doing. And I see that echoing across the state.

I can speak for LA County, but I know it's been a huge success across all the regions in LA County. For such a large county to display this for over three years.

Yeah. I mean, even the agenda the background spoke to, well, one that's mostly caregivers calling, over 60% of them calling for support because they want to keep the kid. Right. They just need some extra support, ensure that the kid doesn't go back, the youth doesn't go back into the system. And, you know, the numbers show that this program is really, really successful. I mean, I think that's why it was my question to Department of Finance.

I was like, this is a really successful program that helps stabilize these families so that we can save money down the line by not putting the youth back into the system. So both on the fiscal part, it saves us dollars if we invest in this, but it's also, on its face value, a very worthwhile program.

Madam Chair, you were picking up what I'm putting down this? Exactly. It makes sense across.

I played softball, so I'm a good catcher.

See, I knew it. It makes sense on both sides. One, number one, the kid of their families, and then from the expenditures that we have to put out financially because I tried to briefly demonstrate for you how much personnel are pulled from other EMS services to deal with calls like this and potential trauma removal to then just slim it into very trauma informed, specialized people that can take care of this and really want families to be together and they'll follow it.

It's dynamic because it stretches across all those elements fiscally, but more importantly for the people.

Because the agenda also shows that majority of the time, everything can be handled. It was handled in that conversation that a lot of the times your team, or at least examples of your teams didn't have to go out. So I think 41.2% are stabilized at the hotline. Is there room to adjust this program where it doesn't require a lot of available teams to be responding? The majority say no over there. Okay.

No, no. I see what you're saying. And there is a lead to that. What I found, and this is from a personal side, but it's encompassing our whole program. So I see the numbers and I wish I would have also have them here to illustrate for you that post. And during COVID a lot of people got used to the aspects of doing everything over the computer and not having a person to person.

Well, families that are in trauma, kids that are in trauma, they don't need someone on the computer, they don't need a phone call. And what's made this so successful is every call is treated as a need for mobile response. When it gets to us, we're going unless to explicitly said no. I just need you to support me over the phone. That's why at 02:00 in the morning we're there.

And this makes a difference because someone's not getting another hotline to wait on another pass to another person or a voicemail. They're getting telephonic support. Just want to let you know. I didn't get to illustrate that, but from the moment they call, they get telephone support from us while we're driving to them. So the de-escalation, the learning process is happening in real time. We're gathering that information. At the same time, someone is gathering database information about children's history.

If we can pull that up to help better deescalate the situation. And then we go with all that information into the home so we're better informed to approach them. And now we're in person. It means a lot more when you're in person. It's the human aspect.

Yeah. Thank you so much. Moving towards the Foster to Adopt Parent from San Francisco County. Is that you, Mister Center?

Yes. So my name is Ed Center, and I'm here as a dad, and I'm here to tell you how FURS saved my family. So my husband and I adopted two sons through the foster care system. We led a happyish life until our older son's mental health crumbled under the stress of the pandemic. I'll use his middle name, Hoku. In January of 2021, he was 10 years old, and he was nothing like the charming, mischievous kid that he had been a year before.

He wouldn't go to school. He stayed inside for days, sullen and addicted to YouTube. If we asked him to do anything inconvenient, like get off his Ipad or take a bath, he would devolve into fits of rage that would last hours. His behaviors included screaming, breaking things, and painting. I hate you, dad. On the walls, the one that hurt me the most. Was when he took a sharpie and he blacked out his face in every family portrait in the house. And so we were really struggling.

And I've heard some of the proposals for other hotlines and coaching and resources, and we needed that. But when we were in crisis, we needed Wonder Woman with a social work degree. And it turns out that looks like Gabriel ... Mister Skydancer and you. Just kidding. But we got that when we were finally connected to the family urgent response system, or FURS, which in my county is operated by Seneca Center. And they're amazing.

This changed everything for us. The first counselors would come to our house, as Mister Skydancer said, at 10, 11, midnight, these crises never happened during daylight hours. They would help Hoku regulate and make a safety plan with him. One night, I told Hoku that he needed to brush his teeth before he watched more TV, and that started a two-hour violent tantrum. And when the counselor showed up at her house, she pulled out her own toothbrush and said, I'll race you.

And she had his teeth brushed in two minutes. I was a little bit bitter about that, not gonna lie. And then she helped him calm down and get to bed. Another night, I called FURS from my car. I'd been driving for 3 hours and asked the counselor a simple question. Why should I go back? And I'll never forget what he said. Props to Junior. He said, I can't tell you not to leave.

What I can tell you is we have so much respect for you, and we talk on our team about how amazing you and your husband are, and we can see how much you matter to Hoku, even though he can't show you that now.

And so I bought some crappy gas station coffee, and I turned around for home. My family healed slowly, and it ain't perfect. Hoku is 13 now, and he's very 13. But we are stable. And more important than anything, we are hopeful. The cost to my family, to the state, would be egregious if we had had to terminate the adoption, institutionalize our kid, or if I had kept driving.

And thousands of California families are currently battling with mental health issues and the emotional wellness of their families and children. And so I hope we can protect FURS to help families heal from crises and stay together. Thank you.

I need to invite the chairs of all the other Subs to come sit and listen to every single hearing we have here every Thursday, because while they're fighting to see do we cut EV's or transportation like I have to sit here. Not that I have to. I'm blessed to sit here to listen to this. And it's hard. That was hard to listen to.

It's been a tough week, being a Legislator and leading a Subcommitee that has to figure out who do you cut? The responses I get from the Department of Finance is because we have a tough budget year. It's not enough. It's not enough. This Subcommitee should never be cut, ever. These are the things that impact people's actual lives. Because your kid could have been a statistic, have been homeless, died by suicide, or you would have had a broken family, and it wouldn't have been your fault.

It would have been because the system failed you. And I'm part of the system, and I can't figure out how even being part of the system, we can't get to an agreement that this should never be on a chopping block. Never should. Never. I should come to sub three and not have to say a word.

But I'm coming here and having to fight for this every single Thursday and in between, and I don't understand how we can go back and look at this plan and say, yes, we're justifying this cut to first CalWorks, foster kids. It's hard up here. And today, my stress ball did not help. And I tried and hold it in, but it's hard because. And then everything else gets. It's still okay or delayed. Like, these are permanent cuts.

There might be other programs that exist, but there will never be enough programs for these kids, because at the same time, when I'm working on this, then I'm also working on OICR issues, because these kids that we failed are then in our juvenile justice system. And I'm like, well, if we would have stepped in before, they wouldn't be here in my district at one of the worst juvenile hall centers in California. And it's not their fault. It's because we failed them.

And then we spent so much money on CDCR, on. On those programs because even though they're adults, we failed them as kids. How do we save money in California? We invest in our kids. We invest in stabilizing families so that we don't have to spend billions of dollars on CDCR and juvenile halls. And we eradicate every single juvenile hall because we are no longer gonna have kids in these centers because it's not their fault that they got into this situation.

I mean, I keep having these ramblings in sub three. I don't know who it's falling on. Like, I don't understand, but it was a tough week fighting for our vulnerable communities and the bureaucracy that exists in this block here. And I'm still wondering how people don't see what's happening. Advocates, I get, you hear it. I just hope leadership hears it, the Administration hears it. My colleagues hear it, because, you know, colleagues can be on the front line for electrification, for AI stuff.

I can't write legislation on AI because my communities don't have food on their table. I'm barely trying to pass legislation to meet the basic needs of the most vulnerable communities. I don't have the ability to look at what can I do about AI because I haven't even gotten past step one of ensuring my community Members have access to water, clean water, clean air. Our kids are supported, that they have enough funds to survive, that they're not living in cars at the age of 18.

But we're focused on other issues. That's why I keep saying I'm so tired of the headlines of all this. Look what we're doing in this space. But we're failing our kids left and right, our most vulnerable communities. So I apologize for getting emotional. It was just really hard to listen to. It's really hard. Okay, hang in there. We got one more person on this panel. I think that was more for me than y'all. I need to hang in there. All right, Mister Christopher Hernandez from California Youth Connection.

Just thank you. Thank you so much for your advocacy and your heart. Thank you. Hello. My name is Christopher Hernandez, and I run the legislative Department at California youth Connection. CYC is a youth led organization that develops leaders who empower each other and their communities to transform the foster system through community organizing, legislation, policy, and practice change. Our membership base is made up of 14 to 24 year olds who are current and former posture youth from all across the state.

CYC is in a unique position in child welfare because it has such an unmatched direct connection to young people who are currently or formerly in the systems we are talking about today. So as I urge us to collectively reject the governor's proposed budget cuts, I do so not as an individual, but with the weight of CYC's entire statewide membership, we say, not these cuts, not these kids. Today, specifically, I'll be sharing about the uniqueness of the Family Urgent Response System, also known as FURS.

Eliminating resources for the family urgent response system leaves foster youth vulnerable during emergencies, depriving them of rapid assistance and a safety net. They rely on really amplifying their sense of insecurity and isolation. FURS is a valuable resource for youth in foster care because it has child welfare professionals who are trained specifically to support foster youth. FURS is unique to youth because it has on-demand support that is ready to softly support them and ensure they are protected when navigating a scary situation or environment.

FURS is specifically crafted through the work and values of youth and caregivers, a resource unique to foster care for its timely responses, its specific lens, and its ability to support families at any moment, anywhere. This resource is unique and it's important to youth due to its ability to stabilize placement and minimize the potential utilization of congruent care.

CYC has led a campaign on growing placement stability and although we have seen a decrease in number of placement changes of 11 to 17 year olds, there's still more work to be done to stabilize youth. FURS has made strides in this direction of stabilization. Youth and families throughout the state are still learning about this amazing resource and as we save it from being cut, we will continue to educate youth and families on how valuable this program really is.

The foster care system has raised generations of youth who see making mistakes as a risk, a risk that shouldn't be taken lightly. Mistakes that mean trash bags, mistakes that mean no or seven day notices, mistakes that mean school changes, mistakes that mean different family mistakes that mistakes are what stand between the bed you slept in last night and the bed you used tonight. Most importantly, mistakes jeopardize your ability to be part of a family.

So when youth stand for FURS, it's not to preserve their family replacement, because sometimes it's, it's not a good fit, right? But FURS is also a program that can ensure that youth have the help and support during family emplacement transitions. Ensuring I, Christopher, at 10, 12, 13 and 17 when moving between families, knew that making mistakes was okay and that sometimes families need support to be effective.

Had FURS been a resource I could have utilized, I wouldn't have walked through life or placement changes alone, constantly fearing mistakes. My mistakes would have been met with grace and foster care specific professionals who could have explained the situation to me. I ask, please protect FURS. Thank you so much.

Thanks Christopher. Mister Skydancer, have you encountered any ramp up issues or problems with running the program? We heard from LAO that not all counties are utilizing their funds and I know you can only speak to LA County.

The best way for me to answer that is to say we've had awesome support from our Administration, that we jumped in both feet and just said we're doing it and we're going to make it successful. And fortunately, my Administration saw that I came from another program that was pilot and it's solidified in LA County. It's actually grown three times. So we believed in a lot of the overlapping philosophies that happened with fers and how it could be effective.

And we've seen the reduction in shelter care for youth, shelter care under that umbrella. So we knew how it would cascade and we jumped in feet first as quick as we could and just pulled very awesome people into the program. And luckily the Administration has been very supportive and have seen the fruits of the labor, the statistics I gave you. And when everybody can get by that, I see that really amping up as everybody said.

Increasingly now we're getting on private Facebook message boards that are just for caregivers that we're not invited to. We're hearing we're on there and they're saying, call first, they can help you out. We're getting into other elements now where it's community, it's grassroots, where they're promoting within themselves, saying this is a newer program, it's outside of DCFS. And they go in with, we go in with the lens of not accusation or investigation, it's support. And that's how we step in. And really the Administration and the community has seen, that's why it's successful.

If the senoras are sharing the information, it's going to spread wide.

Yes, exactly.

Angela, do we have a list of the counties that utilize all the funding versus the ones that don't?

We would need to work with the Administration, but I think that is something. We could look into a county-by-county expenditure table.

I'm not sure for you or Mister Davis, is there flexibility in this funding? Whereas we see some counties that don't utilize it all and we can readjust the funding in that sense. Like we send it to some counties that are always maxing it out each time. Is there room for that? Or is it just set in stone that every county, so in the past couple years have gotten the same amount each time?

Marlon Davis, Department of Finance we're continuing to be open to any discussions to balance.

No, no, no. I'm asking how it's been done so far. Is has in the past couple years since the program has been running, the funding that goes out, if there's some funding that isn't utilized, does it get called back? Does it get reallocated in a different program? Does it get reallocated to another county that is utilizing all their funds? Or maybe you have the answer.

I would have to defer to the Deputy Director.

I appreciate the question. And while I don't have a sort of county by county accounting in front of me directly, I will say that we have observed that there are some larger counties, like LA, where utilization has been higher. We have seen some larger counties and sort of medium sized counties where it has not taken off in the same way relative to their numbers of children and youth. We have seen the program implemented July 1, 2021.

We've seen an uptick in implementation every year since that time. So some of this may be the sort of natural beginnings of a newer program as it is taking off. We do have some programs in the Department where the kinds of redistribution that you're describing do occur, where we might have counties that are overutilizing, counties that are under. I'm not aware that we have specifically had that conversation with respect to fers.

I'm happy to go back and ask that question and bring you any additional information, if there is any. In General, if the funding is not utilized, it would revert to the General Fund in time.

Okay. Eileen, Pinch Hitter.

So we do have a redistribution process before it would revert to the General Fund for counties that overspend the allocation. It is kind of moved all around. They use as much of it as they can, and then if there's any leftover, it does revert to the General Fund. We've worked very closely with the Department and they've been great about moving money around early. We haven't done that yet for FURS because it has been early in implementation.

So we don't, you know, we want counties to plan for spending it all during the year, but there are processes that we have in place that can move money around, you know, sooner than that normal time when that happens. I think for fers, one of the other challenges in implementation has really been building trust in the communities. And you've heard Mister sky dancer talk a lot about, about it.

And so I think it has taken longer to build up in some communities, not just for the caregivers, but for the youth themselves. And so that's been an added layer, I think, of implementation challenge around this program. But the word is getting out about fers. And so I do think that the uptick is going to continue. So did want to throw that perspective out there as well.

Thank you. And in regards to soaps. And I'd like to come back to you, Miss Pope. Did you, I know I heard you speak about, you know, the amount was made, it very difficult for you to find a location because of the cost and so forth. At what point? And I know we only heard your part of your story. What helped? What allowed you to find a location?

Was it just getting a landlord that didn't look at all the background, the finances and all that, or was there something that came that helped you find a place?

At that time, when I was looking for housing, I was very aware of this dark reality that I was going to be relying on the kindness of strangers and just hoping that I could find someone who would be willing to accept me, even with my income issues, because I, at that time, was, you know, considered Low income. But a lot of subsidized housing, Low income apartments, don't accept college grants either. So I still didn't qualify there.

And if I didn't have enough, say, work history, which oftentimes foster youth moving around a lot, don't exactly have stayed stable employment either. So on all fronts, I didn't have the qualifications.

So if I didn't find a landlord who was understanding of my situation, which, considering the prevalence of corporate landlords nowadays that are more about what you look like on paper than about what your story is like I said, I was relying on the kindness of people that I was just hopeful would be willing to listen.

Do we have anything. I didn't do any homework on this, but do we? Is there anything that exists kind of like section 8 or housing vouchers? Where is it the same type of approach where a landlord has to accept it? They don't. It's not a mandate for them to accept it.

SILP is not like that. There is a foster youth to Independence. FYI, voucher at the federal level, that is a voucher that is specific to former foster youth, a current or former foster youth. That said, we have encountered with all other states in the nation a lot of difficulty in utilizing those vouchers. And I've had some conversations with the Federal Government about ways that we think they could restructure that are not within our control, but that voucher does exist.

The silp itself could be a variety of kinds of placements, and I think that Miss Pope sort of referenced this. It's intended to be for non minor dependents who are ready for a level of Independence and could live in an apartment, a dorm, a single room. They could live with relatives. They could live in the home of their parent or guardian. They could be in job corps. There's a wide variety of places.

The idea is in the law is that the county is supposed to be assessing the young person for readiness for that situation and making sure that there is indeed a suitable place for them to live, and then to utilize the SILP as a payment to support that placement.

And one of the first questions I asked was, when could we assume it could go in? The reason why I was asking is because later we're going to be talking about the rate reform. And it seems like even if we move forward with this increase, it will start almost at the same time as the rate reform. Right. Okay.

And then I'm wondering, there's about five counties that even with the rate reform, they will not meet the minimum requirement to be able to find an apartment because it's so expensive, like our Bay County areas

There are so I think probably what you're referencing is the difference of the current rate with the SILP supplement versus the rate reforms rate. So the way that we've done that calculation, it's about 96% of youth across the state who would receive a higher rate for silps under the governor's proposal, and about 4% of youth in about five Bay Area counties, which you're referencing for whom it's not exactly that same amount. Yeah.

May I add something to that?

Yes.

I think one problem is we're talking apples and oranges. So when we're talking about the facts that Miss Troia is referencing, that has to do with the care and supervision rate of $1,788 and then adding on $500 of what's called the strengths building program that is not provided directly to young person, according to the Trailer Bill Language.

So if you look at the care and supervision rate, that's actually going to be the sIlP rate provided to youth, 80% of youth would receive more money under the current law of the SILP housing supplement than they would under the rates proposal. So it depends what you're looking at.

Are you looking at that in kind, $500 worth of sort of extracurriculars, enrichment activities, or are you looking at the money intended to provide the care and supervision that goes directly to young people, that covers shelter, food, all the basic needs?

I think I was looking and I thought the care and supervision was straight to the caregiver, not the.

In the case of a SILP, the care and supervision is straight to the young person. So I think that it is true that we're sort of looking at this different from the department's perspective. We are considering all of that to be the SILP rate. We're looking at it and including the $500 that goes towards strengths, building on the assumption that that can be broadly utilized for things young person needs.

There's a lot of flexibility, and so those resources are still relevant, and not all of the silp rate normally would go to rent anyway. Some of the rate would also be supporting other things in the youth life that $500 could offset. So we are viewing it as the 1788 plus the 500 is the total amount that is available to a young person in a soap. And I understand that JBAY is taking a different perspective that the 500 is a sort of separate. Separate.

But it can offset additional costs to the youth that can. Then they can pull that into their rent.

That is our perspective.

But they don't get it directly. It's by payment manager.

Yes, yes. Thoughts on that to come. So have we looked at perhaps at minimum, not at minimum, at least making hold those approximately five counties that won't meet that threshold?

It's not a part of our proposal presently under the rate reform to do that. It is something that we looked at and recognized that it would take additional General Fund of I think it's several $100,000.

Okay. When we have an exact number, could you send that over, please?

We sure can.

Okay. Senator, you missed it. I had a breakdown.

There is nothing that I could do or say to match the amazing Chair that I serve with on this Budget Subcommitee.

I don't know if you had any additional questions.

Absolutely nothing that I could do to add to your questions. Thank you for asking however.

Okay. Any final thoughts from anyone? We're going to wrap up the panel here. Okay. Thank you so much for coming out and speaking to these very important issues. I appreciate it. We're going to hold the items items open.

Honored to serve.

We're just on issue number two. Moving on to foster care rate reform. Welcome the Department. Mister Davis is back with us. Angela is sticking around. Another representative from California youth connection to come up, Eileen. California alliance of Child and Family Services, California Alliance of Caregivers and a rep from Youth Law center. A total of eight people. I see 9, 10. Okay, so it's finance that we have to. Yes, we do. So. 1238 . Yes, of course. I knew that. Okay, just making sure. All right, take us off, Director.

Good morning, chair and Members Kim Johnson, California Department of Social Services and just greatly appreciate the conversation that just took place in the first panel.

We are really aiming to support youth and families in our foster care system and child welfare system, building on what we know has worked in continuum of care, which was founded upon the collective belief that all children served by the foster care system need, deserve and have an ability to be part of a loving family and not to grow up in congregate settings. As you know, in our CCR efforts, placement stability indicators for children remaining in their first placement have also continued to grow.

75% of youth that have had that first placement with a relative and are still in care at 12 months are still with that relative. So again, we're trying to build on lessons learned and progress we've made to date in the CCR place. Fundamentally, this rate reform proposal is focused on keeping families together, assessing and meeting the individual needs of each youth, and advancing equity.

The proposed permanent rate structure invests in strength building and addressing the immediate needs of children and youth, allowing us to greatly increase the number of children living with their own family Members and tribes with the support necessary to ensure the success of those placements and settings.

The positive experiences that youth are more likely to have when cared for by their own family and when they have connections to enrichment and cultural activities have been proven to help mitigate the mental health damage caused by aces and to help that youth heal. We want reimbursement rates to be responsive to what youth and families need to thrive so that the proposed rate structure support services in place based on the child's CANS assessment and identified needs.

If adopted, California would be the first state in the nation to take this approach. The proposal also invests in new approaches to rates. Up until now, the rate structure has only paid for care and supervision. This proposal adds investments for the first time ever in strengths building and addressing a child's immediate need if their CANS indicates that they have those actionable needs.

Participation in enrichment activities has been proven to help young people heal, promote supportive social connections and provide opportunities to develop valuable skills and is consistent with what we've heard from youth in terms of what's needed. The proposal makes significant changes. I want to just underscore your agenda outlines. It is a significant change from the structure that we have today.

As such, we look forward to not only engaging with interested parties in the short term, but also having focused efforts on capacity building and other details that will support our collective success in operationalizing this proposal over the next two years. As again you heard, full implementation is expected to begin in 26-27 and I'll turn it over to Deputy Director Schwartz.

Good morning chair and Members of the Committee, thank you for the opportunity to speak today. My name is Angie Schwartz. I'm the Deputy Director of the Children and Family Services division and I'll focus on the questions and the agenda since Director Johnson just provided a great overview in response to the question regarding how this compares to the current rates, the proposal provides new funding, as Director Johnson noted, to support strength building for youth across all placements, including youth within extended foster care, as you were just having the conversation about youth in cilps.

Additionally, as noted, under our interim rates, youth with the highest acuity of needs only qualify for the highest level of funding when they're within institutional placements, and this proposal allows for those supports to be provided to meet the needs of children within family settings or for older youth within the transitional housing settings that enables us to support children in the homes where we know they do best.

As Director Johnson noted through the statistics in the homes of their relatives and their extended family Members, this proposal was not designed in isolation. It's sincerely responsive to the stakeholder feedback we sought and received during the course of more than 24 workgroup meetings held in the fall of 2022. The consensus coming from those workgroups was rates should be based on the child's assessed needs using a validated assessment tool.

We heard clearly that there needs to be funding to support services that has never been part of our system before, and we heard directly from young people about the importance of investing in their strengths and maintaining their strengths when they come into care. In terms of the overview, Director Johnson noted the three key innovations.

First, that the rates will be based on the child's assessed level of need utilizing the cans, which is is a highly validated functional assessment tool that's been required to be utilized within child welfare since 2018. Second, the two new investments that Director Johnson noted strength building and immediate needs for those children where needs have been identified by the cans. And finally, the funding shifts away from being connected to the placement and is instead connected to the child.

In response to your question about how this addresses barriers to support youth with complex care needs, enabling children to have funding connected to their needs in any placement setting is very responsive.

As I indicated, young right now, youth with the highest level, the most complex needs can only have those needs met within institutional settings where there's disconnection from family and supports that are actually critical to that young person healing and thriving in terms of the administrative components of the proposal that you asked about, under this proposal, foster family agencies and STRTPs will continue to receive funding to support care and supervision as well as their administrative expenses as they do now under the current rates.

However, the administrative portion of the rate for youth within tiers 23 and 3 plus under the proposal is going to be restructured to ensure that there's dedicated funding to to support immediate needs instead of bundling it all together as part of the administrative rate. Structuring the immediate needs dollars in this way ensures the immediate needs funding travels with the youth. It enables for those needs to be made and met even when they're not in facilities like STRTPs or FFAs.

So when they're within their own family settings. It's also an investment in community services and supports and facilitates providers creating new models in order to serve children within the homes of their relatives and extended family Members. And having dedicated funding for immediate needs also means there will be more statewideness and continuity of services. For example, when a youth transitions from an STRTP into a home placement, the services can travel with them and continue to support the youth in that family setting.

In terms of the timeline and implementation questions. Since the release of the trailer Bill on March 5, we've been engaged in extensive stakeholder feedback. The trailer Bill is lengthy and complex, as the agenda notes, and as expected, with such comprehensive reform, there's been a lot of feedback that we're receiving. There have been many questions raised which we are committed to working through and implementation. As noted in the last panel, the proposed rates would set to implement in July.

Yes, July 26, following automation of the new rate structure leading up to that over the next two years. As we approach that date, our intention is to continue to work closely and collaboratively with counties, tribes and other stakeholders in order to ensure that we are not increasing the administrative burden on counties or on providers, and that we are making sure that those new strength building dollars and immediate needs dollars would be readily available across all placement settings in order to support all of our children.

As to your question about timely and quality cans? We are already doing work to ensure Fidelity to the cans and to make sure that all youth are receiving cans timely. We're working with the cans researchers to identify the fidelity tools and are in discussion with counties and stakeholders and tribes about how to implement those fidelity tools in California.

Finally, as to the question about the mechanics of the strength building dollars, this is one of the aspects of the proposal that we're most excited about and is wholly responsive to the advocacy of youth over the last several decades. We believe it is critical that these funds be available through a self determination model so that youth are leading the decisions about where these dollars should go and the activities that they'll be able to participate in.

The goal of having a financial management coordinator assigned to each youth other is to ensure that these funds are used consistent with that self determination model and that they can get out in a very timely manner so that the young person has immediate access for the variety of activities they would be choosing to participate in.

We acknowledge this is a big shift with levels of complexity, but it takes this type of shift to accomplish the goal of having a rate that follows the child, that ensures children can stay connected to their families, and that invests in their needs and strengths, and we're happy to answer additional questions.

Mister Davis, would you like to add anything?

Marlon Davis, Department of Finance nothing further that happy to answer any questions.

Short, Angela Short, Lao as you've heard, this proposal truly does represent a very significant revamping of the current foster care rate structure and overall at a high level, we would agree with the administration's assessment that this proposal does seem truly to further bring our foster care rates into alignment with the overall goals of the continuum of care reform. For example, one goal is to improve access to supportive services regardless of the type of foster care placement a child is in.

The administration's proposal proposed new strength building and immediate needs components of the rates we believe would do that. Another goal is utilizing universal child and family assessments to improve placement service and payment rate decisions, and again, it seems that utilizing the cans tool could help achieve that goal. Also, as you've heard, this proposal is very much live and continuing to evolve.

The Administration and state stakeholders are continuing to engage in a number of feedback sessions which we are very actively monitoring and trying to ensure that we are fully tracking all of the issues, the various questions, concerns, comments that various stakeholders have with specific elements of the proposal and trailer Bill Language, which I believe you'll be hearing more about from other speakers on this panel today. We will continue to flag any issues that we see for the Legislature as they arise. That said, a couple of comments we did have at this time.

First, if the Legislature agrees with the administration's proposed timeline, which as we heard, would be to begin rolling out the new rates July 2026, a question we have is, in order to meet that timeline, what elements of the proposal truly need to be finalized and landed now as part of the current budget process versus what elements of the proposal might benefit from additional time and consideration given how significant of a change the proposal would be.

This is something we are also ourselves working to better understand through discussions with the Administration and stakeholders. And then one other comment we did just want to flag is that we have not yet received back up to be able to review the fiscal cost estimate which is included in your agenda on page 11. So we are working with the Administration to get more detailed information about the cost estimate, particularly for the out years. And once we have have that information, we'll be working to make sure we understand all of that from the fiscal perspective. Thank you.

Miss Short, what kind of tracking do you think would be appropriate for the Department to report on to make sure that we're successful or for us to monitor reporting to the Legislature?

I think that's something we'd probably have to consider a bit more. I mean, certainly, as was mentioned, timely cans assessment seems like that would be a key element given how critical cans assessments are to the proposal, to the new rate structure. That is something that the Administration does currently report on as part of statutorily required quarterly CCR updates. So I think continuing to monitor that and then we'd be happy to work with staff and to think more about other particular kind of reporting and oversight elements.

Thank you so much. Before we move on to the rest of the panel, just a couple of questions. In the TBL, there's a section regarding to determine a schedule for transitioning children in current foster care placements. What do you mean? Are we transition them out because they might be tiered in a different location or what? I guess I don't know.

I think it's referring to that section of the trailer Bill, just how they'll transition from the interim rate structure to the new rate structure and wanting to make sure that the transitions happen when the cans is being done, but then also in a way that doesn't disrupt current placements. So if a young person was assessed at a level where there would be less money, we would want to take that into consideration and have the schedule adjust for that.

Is there any placing agency that will need training on the CANS assessment?

Yes. Probation is currently not using CANS outside of using it within. For youth within the STRTPs, which is where the majority of their young people are placed, their behavioral health partners do the cans for youth within the STRTPs. But this includes language in the trailer Bill that would require the CANS to be completed for all youth that are served by all of our foster youth that are served by the probation system.

Do you anticipate any difficulty in probation utilizing the CANS assessment?

We have started having conversations with them about that and different ways to make sure that they would be able to get the right training and support order to be able to come into compliance with that requirement.

Can we post it if they're hesitant?

I'll just briefly add, chair, in terms of your question around training, there are additional alignment components for the cans to do across systems. And I would just say ongoing kind of training to keep fidelity is something that we want to keep an eye on as well. So those, in addition to what Deputy Director Schwartz mentioned, recognizing the importance of making sure the assessment and the inputs and process by which we're making that assessment is always done to Fidelity, that'll be an ongoing effort that we'll be.

Working towards in talking about when we're putting together the strengths, building spending plan and the spending manager report in the TBL. You know, our intent here is to provide information and supports the child and family upon request regarding available goods, services, and supports. I was reminded of what we see with Regional Centers where not every single Regional Center provides the same available resources to a family in front of them. So what can we do to prevent that from happening and ensuring that we have a standard guide of what is offered to each family, regardless of XYZ.

So I would say that the self determination model, we did look at the DDS system, and we are in conversation with them to address barriers that they've had in implementing on their side a similar type of self determination model for clients of the Regional Center, but it's not completely aligned. Right. So we want these funds to be very flexible, to be.

Be able to be utilized by young people for the whole range of kinds of activities and services and community engagement and cultural activities, and also ways just to stay connected with their family that goes well beyond sort of a guide. I think, you know, we've heard that it would be helpful to have sort of things that are already known to be activities that, of course, are allowable things. So anything associated with school and school, school trips and, you know, sporting activities and theater and. Right.

So we can think of a large list of things that would be included, but we don't want it. It would definitely be including but not limited to because we want young people to be directing these dollars. And that strength building plan is really intended to sort of reflect what they want to do. And so it could be a lot of other things that we may not be able to come up with as we're like putting that.

Oh, perfect. Because, yeah, I was like, one of my questions, and thank you for the clarification was like, is it an exhaustive list is going to be a living document, but the youth, the youth decide they themselves can come and say, okay, great, awesome, thank you so much. And sticking to the strains building funds, as it's written right now, it will end once they exit foster care. But we know that the case is open still six months post that. Let me see if I'm saying for reunification.

But the case is still open for six months. The social worker is still working with the family. I'm wondering if we thought about matching that benefit to the extended six month since the case is still open. I don't know if we've heard this from many stakeholders.

We've certainly heard it from stakeholders in the workgroup meetings and we are taking all of, all of the feedback that we've gotten under consideration. But we have heard that you can see what the proposal is reflected in the trailer Bill currently, yes.

But I know, you know, from now until it's going to, it's going to change a lot. So just want to know if we were thinking about that and then sticking to that same thing. The 500 to 900 depending on the tier, does it roll over if it doesn't get utilized?

So in the Trailer Bill, I think it clarifies that the funds have to be spent within the fiscal year. So they don't have to be spent fully month to month. So you can come up with kind of your annual plan, but they do have to be spent within the fiscal year.

Okay, thank you.

I think that's it. oh, yes. One of the last questions I had is, I know we're waiting for the automation part. What else do we know? We need to do that once the automation is done, the dollars are flowing out. Do we know, are we accounting for that? I just want to make sure once the automation's done, it's not like, hey, we need an extra, right? Yeah.

We have a long list going of things that have to be done as part of implementation. So automation is obviously a key piece of that. Obviously making sure that we have the contract with whoever would be the spending plan manager and that that is up and running and that we've also released guidance specific to those strength building dollars. There clearly needs to also be work around implementation with regard to the immediate needs dollars and making sure we get out the county fiscal letters.

And then there's, there's a bunch of other guidance that has to be released as part of the proposal and leading up to implementation. So it'll be a busy couple of years.

I'm really excited about this. I really am excited. I think the extracurricular or the strengths? Strengths building. That part I think is really great. I'm excited that within this rate reform individuals will get in higher amount for soaps or just if you accumulate all that funding together. I'm glad that we're following the individual versus the placement. I know we're shifting a lot in a lot of other different things in this under the HHS, just whole person centered following that individual, which is really phenomenal.

I do want to thank the Department because I don't think you hear that a lot from me in the sub three. I do want to thank the hard work that was put into this and I know that going to be ongoing. You have all taken on a lot of different programs, a lot of different things we're doing. We're going to be talking about child rate reform. It's a lot of things. So I do want to say thank you for the hard work.

And I know you'll continue talking to the stakeholders here and beyond to ensure that the intent, of course, is there and that we avoid some of those unintended consequences. My ask is to ensure that.

We want to track our, our progress because how will we know we're being successful? Successful A in meeting this 26 guideline, but also successful in providing the intended resources to the foster youth, how we will be tracking our success. So that would be my ask. So let's move on to our next panelist from the California Youth Connection.

Perfect good afternoon, Committee Members. My name is Kristina Tanner and I'm a Policy Coordinator representing California Youth Connection. I deeply appreciate the opportunity to present our organization's perspective on the proposed permanent foster care rate restructure. California Youth Connection is a youth led organization that is committed to advocating for meaningful reform within the child welfare system, particularly for the benefit of future generations of foster youth.

After conducting a thorough analysis of the proposed rate structure, our membership views this as a groundbreaking step by California to invest in the well being of foster youth and their families. This proposal reflects the values and voices of CYC Members across the state and underscores our collective commitment to ensuring that youth are being prioritized above all else. If implemented successfully, these rates have the potential to usher in a funding system that prioritizes the needs and the strengths of youth regardless of their placement.

By allocating specific funds for youth strengths in properly addressing their immediate needs, these rates represent a substantial shift towards a more compassionate and efficient support system. The rate structure is set up to fund placement types. Currently, we have four the current rate structure is set up to fund placement types, which has forced use into fit inside of one fits all approach. For decades, CYC Members have brought countless foster youth advocates to the capital to educate people around how harmful this practice is.

Foster youth are being forced into STRTP settings regardless of their level of need because there were simply not enough beds available in home like settings. The tier system that is being proposed has the potential to create an additional checks and balances to ensure that young people live at the least restrictive placement possible while providing additional financial supports to the placements that can exist. This rate structure would transition the focus from funding placement types and instead fund the unique needs and strengths of young people.

Furthermore, this creates avenues to accessing federal resources, granting counties the opportunity to develop personalized services and supports for youth with greater needs. Ultimately, this approach aims to instill a sense of belonging within youth, enabling them to remain within their families. We are particularly excited about the inclusion of the strength building funds, which will broaden access to enrichment activities and other supports identified by young people themselves.

These activities are crucial for the development of young people and will facilitate compliance with federal laws requiring such activities, ensuring these funds directly benefit youth. For youth in foster care who already grapple for significant uncertainty, these opportunities are transformative. Engaging in activities like joining a sports team, learning to play an instrument, or even participating in art class not only offer enjoyment, but they also serve as a lifeline for fostering connections with others and uncovering their own strengths and passions. Therefore, when discussing funding for enrichment activities.

We are not merely discussing budget allocations. We are discussing an opportunity to restore a sense of normalcy and belonging to these youth. We commend cdss for including language that clearly states the money doesn't go to counties or caregivers, but rather a third party whose sole objective is to work with a young person to determine how and where these funds will be spent.

This is responsive to the concerns that we have raised around needing to create safeguards that guarantee that this money makes it to youth in ways that isn't intended. We look forward to working with the Department during implementation to explore ways to push for oversight and monitoring of counties to ensure that CANS, assessments and child family team meetings are occurring on a regular basis and that youth are involved in the process.

Each time this proposal success depends upon the county's ability to abide by current statute and do so with foster youth by their side. Ultimately, what matters most is the tangible impacts these changes will have on the lives of youth. By ensuring that funding is directed where it is needed most, we can guarantee that every child in foster care receives the support necessary to thrive. Whether it entails funding for therapy, educational supports, or simply providing opportunities for youth to enjoy childhood activities.

These changes hold the potential to affect substantial, positive change. And it is more about more than just financial resources. It's about empowering these children to thrive, to grow, and to envision a future filled with hope and possibility. In many of these hearings, we have listened to people speak about the complex care needs of a small population of foster youth. We believe that this proposal before you today will disrupt a system that has failed to serve the most vulnerable foster youth with the highest level of need.

If this proposal seems like it would redirect services, that's because it will. If this proposal seems like it is shifting a power dynamic and giving foster youth more autonomy, that's because it does. California has a responsibility to assure that young people in foster care have the opportunity to thrive, and we at CYC believe that this is a necessary, necessary step towards a better future for foster youth. Therefore, I urge you to support the foster care rates proposal before you. Thank you for considering the welfare of our youth.

Thank you so much for your remarks. I appreciate it. Eileen from our county Welfare Directors Association.

Thank you very much. CWDA supports the overarching goals of the proposal to support family based care, particularly kinship care, and to establish a new structure driven by the child's needs rather than by their placement setting. We're also grateful for the proposed new state investments associated with this proposal.

As noted, it's comprehensive and complex, and we believe that there are a number of outstanding questions and issues that need to be addressed, some in statute and some that can be deferred to administrative guidance, but all requiring more discussion with county placing agencies, tribes, providers, and youth and caregiver representatives.

We've submitted a budget memo and supporting attachment on April 23 providing our detailed responses and recommendations related to the proposal, and we endeavored in that to highlight those issues that we believe need to be addressed in TBL prior to the end of this legislation legislative session in order to ensure that necessary automation can begin to meet the desired 26-27 implementation date, and which issues we think can be deferred for more discussion in subsequent legislation.

Our overarching goal, though, is to keep the ball moving forward on this important proposal. Due to time constraints, I'm not going to go through every recommendation but hit the highlights of our budget memo here, and I've grouped the issues into a few major categories, the first of which being the care and supervision component. Specifically the tiered rates and the CANS.

It's predicated on the CANS instrument, and while we don't necessarily object to that at CWDA, we know that there are a number of challenges in CANS implementation that need to be addressed for the new rate setting process to be successful, including data entry information collected through the CANS and alignment with behavioral health system.

Cans tool we recommend that the Legislature adopt trailer Bill language directing DSS to work with counties to address those issues and ensure adequate funding to enable county to complete the CANS to fidelity and ensure timely CFT meetings and report back as part of the 25-26 budget process. We acknowledge the CANS as a highly validated tool for assessments, but it's not designed as a rate setting tool and the statistical modeling or the latent class analysis using the CANS scores to set rates is completely untested.

Use of a latent class analysis should be considered in the future, we think, pending additional testing and validation. And in the meantime, we recommend the Legislature reject the use of that statistical modeling of CANS scores for rate setting and instead direct DSS to work with counties, tribes and stakeholders to identify what information from the CANS matrix and other additional information not currently captured on the cans should be used to determine the rate levels.

We also recommend the Legislature direct DSS to work with counties and stakeholders to finalize the number of tiers and determine the transition from the other rate structure to the new one, and to reflect this in updated TBL by August of 2024. Those are the most critical pieces we think to nail down now to allow DSS to move forward with issuing the policy guidance that we'd need to allow for the automation to proceed for the target implementation date of 26-27.

The second category is the immediate needs component, and we support this component. But we have significant concerns with the multiple onerous and duplicative new proposed requirements impacting counties and providers. These new requirements will result in barriers to standing up and accessing supports and services. We therefore recommend the Legislature reduct the certification model, contracting, auditing and direct CDSS Administration of the immediate needs component.

We recommend instead that you direct DSS to work with counties and stakeholders to articulate the process for county plan requirements, including expected data elements to be submitted by counties, and leverage and strengthen, if needed, the existing child and Family service review and case review processes. And we recommend updated TBL to the Legislature, including proposed funding to counties to address any new workload as part of the 25-26 budget process.

Although we have other recommendations in our letter, I just want to highlight lastly here the critical importance of providing capacity building funding to counties and community based providers, without which the systemic transformation envisioned by this rate proposal will not be fully achieved. And we need engagement by DSS and DHC and counties and providers on strategies to leverage Medi Cal funding as well. And the last piece is the strength building and maintenance component, and we strongly support this piece.

And although we believe that county human services agencies can successfully administer this component of the rate, we do not object to the proposed state level Administration of it. We have identified several operational and implementation questions related to the component as it's proposed, however, that we just want to identify.

We believe that there should be a trailer Bill amended to prioritize ease of access for children and caregivers to these funds to simplify Administration, and we recommend removing counties kind of completely as like the middlemen from this process because we feel that that just adds a layer of Administration and complexity that we're not sure adds value here. I'll just conclude my testimony by noting that the automation of both calsaws and CWS cares is going to be essential to our ability to implement the new rate structure.

And we've got suggestions in our budget memo around concerns and recommendations here for how to ensure that there's planning, sufficient planning and contingency planning should there be delays there. And we also continue, like the LAO, to request a backup for the funding estimates, without which it's difficult to do a comprehensive analysis completely on everything. But we thank you for your opportunity to provide these comments. Look forward to ongoing conversations with the Administration.

They've been very open to hearing all of our many, many comments and questions and to continue working with you all in the Legislature as well. Thank you.

Thank you so much. Three follow up questions in your letter, and I can't remember it says something wrong. Background checks. Can you speak to that a little bit?

Sure. The trailer Bill Language as proposed requires that there be background checks conducted for the providers of the strengths building pieces.

Would also reinsure any provider completed a criminal background check. What part of that is worrisome?

Others can probably speak to this as well, but we find that that's worrisome in that there could be situations where having a background check would be not normally necessary as a process of, you know, as a normal process. And it could just add a layer of both timeliness in terms of accessing the activity, but also just cost for the provider and barrier. For example, if the idea is that a youth should have piano lessons or something, does a piano teacher need to be background checked?

It's unclear whether that is actually a requirement now of this language or if it would just be if they were otherwise required to be. It's those kinds of issues that add complexity and difficulty in accessing the funds and the services timely. And so we suggest thinking through how we might kind of cut through some of that.

TBL speaks if it's already required. Right.

Oh, sorry. That's right. It's intended, if it's already required under state or federal law, to make sure that it had occurred. So it wasn't intending to require new. Exactly. Nothing new.

Two other things. How do you see yourself as it's written, the middle person. What part were you referring to that you want to be removed as the middle person?

So we would have to, first of all, kind of have a child and family team meeting for purposes of discussion of the strengths building. Not sure if having that elaborate process, those can be difficult to arrange, everybody getting together and so forth. So there's that whole element of it. It's unclear to us, kind of how the.

What our role in the process would be if there were disagreements between the caregiver and the youth or the parent and the youth and the caregiver around what the strengths building activity could be. I'm not sure what our role is there. There's talk about us ensuring access to services and so forth. We don't have control over the funding or how we access that funding to ensure that services can be provided in real time. It's an odd kind of, for us, 1ft in, 1ft out.

And so it's just, it's not clear what our role is. And if this, and if this financial management coordinator is going to be the entity that is responsible for ensuring that the funds are available immediately and so forth, like.

Let's have, what is your purpose? Got it. Deputy Director, who is involved in this family meeting? Because I think you, you also spoke to the family meeting.

So we do have the child and family team envisioned as a support, which they should be anyways, to the young person in identifying how they want to use the strength building dollars, making sure that they know that they're there, and having a conversation with the young person and other people that would be part of that meeting, which should include their parent and their caregiver, who would obviously have to be taking them to and from activities.

And so we think it's an important place to have the conversation. And the trailer Bill puts that support role on the CFT. As Eileen said, the counties are the ones that are facilitating the CFT meetings, but there's not really intended to be the role of a middleman for the counties. It's making sure that that conversation is happening with young people in the context of the CFT, which is where these kinds of decisions are happening anyway.

And then to the point about sort of how do you work through conflicts? The CFT is the place that families should be engaging in those kinds of discussions. Cfts already exist. And we think that this is very partial to what CFTs should be doing and the kinds of conversations they should be having.

Okay.

I'll just say the reality is though, these CFT meetings, they don't happen for all youth in particular. Like we're funded, they happen a couple times. So we just need to be mindful, I think, which is ensuring we're resources. Exactly. We just want to have, if that's the venue, then we need to ensure that they are happening timely, that we can pull all the appropriate people together to have those conversations and that we are resourced to do that.

Okay. All right. Thank you so much. Now moving on to the representative from California Alliance for Child and Family Services.

Good morning, Chairman Benjavar. Chris Stonermers. I'm the CEO of the California alliance of Child and family services, and I really want to first start by thanking you for bringing your head and your heart to the Subcommitee. It really is refreshing, really appreciate you. The California Alliance Member organizations provide a wide array of services to children and families at risk of or involved in the foster care system. They run family resource centers, provide school based mental health and in home services that keep families together.

Our Member organizations also provide foster family agencies that recruit, train and approve individuals and families, including Kin, who are committed to supporting youth until they can return to biological family. Over 70% of children in Alliance FFAs provide get reunification services, and over 60% are ultimately reunified with family. We appreciate the vision that underlies this permanent rate proposal.

Focusing resources on foster youth and their families is essential, and allowing families and caregivers to determine how to best meet their children's needs provides a pathway to less children and youth requiring Child Welfare Services over time. That said, we believe that this proposal, as currently sorry, currently structured, will significantly reduce and even decimate some programs that are working with our most vulnerable foster youth and their families. Many of these youth are, of course, LGBTQ youth and youth of color.

These programs are rooted in communities and staffed by people living in these communities, often with lived experience in the foster care and probation systems. Specific concerns include we do not see a clear method or requirement in the proposal for youths behavioral health needs to be met and to support families remaining together through rap and other behavioral health supports. Without intentional integration of these resources at both state and county levels, our most vulnerable youth will continue to be underserved for their behavioral health needs.

There's no accompanying CBL and health and safety code outlining minimum levels of services for youth by tier. Much more discussion between the Department and stakeholders is needed to ensure that youth are getting those behavioral health services they are entitled to receive. Secondly, the rates for the administrative and care and supervision components for youth who need short term residential therapeutic programs are wholly inadequate to serve youth determined to have needs at the tier three plus level.

Workforce shortages due to wage limitations are impacting these programs now, and the current proposal would result in strtps receiving over $3,000 less per month than they receive today. This will definitely result in closure of programs and organizations providing these services, and we will find more foster youth in need of hospitalization. We do not want youth in strcps that do not need this level of service. We want to make sure those programs are funded so that they're getting the highest quality services and treatment that they need.

Thirdly, rates for the administrative components at all levels are inadequate to ensure that family service agencies can provide the highest quality of services and support to families pay competitive wages, benefits cover escalating insurance costs and basic organizational costs for providing these services. The administrative and immediate needs components of the rate also do not include a cost of living increase, providing more funding to families without ensuring these organizations that can support them will be sustained is not going to be in their best interest.

Foster family agencies are already underfunded and have received only two cost of living increases in the past 15 years. They're facing an 8% cut this July unless the Legislature approves the continuation of a COLA approved in the 2023-24 budget process. The alliance's budget request to sustain these organizations is essential to keeping them afloat for the next year. Without this immediate support, there will be far less service providers available in 26 and 27.

We've not seen the details of the financing model of the most recent latent class analysis or the financing model of the tiers. We feel that there's much more discussion needed with stakeholders in order to ensure that youth, families and the programs that support their reunification and permanency have the resources needed to be successful. We really do not want the proposal to pit children and youth and families against the providers that are working with them.

Thank you so much. Thank you for your remarks. You spoke about the behavioral needs. You feel like there's no clear method of meeting the bare minimum. So are you saying they meet the immediate needs? That's where the behavioral health needs of the youth would be met. Are you saying that?

But even separate from this rate proposal, all youth in foster care and in probation are entitled to Medicaid, early periodic screening and treatment and diagnosis services. And we do not see those consistently built in and integrated into the, into this proposal or into how we structure this as it relates to the tiers.

I think, as I noted at the beginning, we heard strongly during our sessions to develop this proposal that there needs to be funding within the child welfare portion for services and for addressing the immediate needs. That's not to say that this would supplant the existing obligation on the behavioral health side and mental health side and the significant investments that have been made on that side, that would remain. That would all remain.

And so all of this is really intended to be additive and recognizing the role that child welfare needs to play in identifying and addressing urgent needs that have been identified through the cans. And so it is, you know, incumbent to make sure that we're partnering with DHCs, which we are already doing, to have the conversations about how to best utilize all of these dollars and resources together. But this is really about the child welfare piece of the obligation.

If that's already there and it seems like it's not happening, how can we then ensure that this part will maybe, did I miss that? How then are we certain that...

I think we feel like these dollars are critical to making sure that we are fully meeting the need and that we are partnering with our behavioral health partners and our mental health and making sure that we are leveraging dollars appropriately. Again, not supplanting, but supplementing the dollars that are already available and making sure that we're being more responsive to the needs that young people have.

How does that work? The youth comes up and says, I need XYZ. We look at...

The immediate needs dollars are intended to be an allocation to the counties that are based on the number of children that they have within their system, that are within tiers 2,3, and 3 plus. And then they would be utilizing those dollars to develop an individualized immediate needs plan for the young person. They could be the certified immediate needs provider themselves and meeting those needs, or having other organizations that they subcontract with to meet those needs.

They could also have an FFA or an STRTPS, who's the immediate needs provider. And so they could also be having that organization. But it becomes more flexible. Instead of saying, like, once you place into the FFA, it's whatever that FFA offers, it's whatever the child's immediate needs are.

So that when they're placed within that FFA, the FFA could be the immediate needs provider, or there could be other entities that are being brought in in order to serve the young person, if that would be more responsive to what those immediate needs are.

On the topic of STRTPS, maybe I need help from the Department on this. I was under the impression that they were going to get more funding through this rate reform per child.

The way that the dollars work is the care and supervision dollars and the admin dollars associated with tier three plus. If a child was assessed at tier three plus and then placed in an STRTP, the STRTP would be guaranteed to get the care and supervision and the admin portion. If they were also an immediate needs provider that was certified, they could also receive the immediate needs funding. If those dollars didn't go to the STRTP.

I think that's to Chris's point that that would be an overall reduction. And so she, I think, is noting that they would need those dollars in order to be at current levels. That said, if they weren't receiving those dollars, there would be reduced work as well. That's expected of the strtps as other organizations are coming in to provide that immediate need support. Exactly. So.

Okay. Anything on that?

Well, if I might, one there is. It's not a guaranteed amount right. Based on like it is for today in terms of the way the rate structure.

The care supervision and the admin would be a guaranteed amount.

Which is 13,000 compared to what is today 16,000. So, and, you know, we're looking two years from now with inflation, et cetera. And most of our organizations today are paying staff about $18 to $19, which is completely insufficient and results in significant workforce shortages.

So just to meet the requirements that they have in terms of staffing, both on the child welfare side but also on the behavioral health side, they've got an, have a significant and clear amount of money to be able to meet the requirements that CCL has of them.

Okay. Thank you.

No further questions on this panelist. Moving on to our next one from California Alliance of Caregivers.

Good morning, Madam Chair and Senator Roth. I'm Jen Rexroad, a former foster parent and the Executive Director of California Alliance of Caregivers. California alliance of Caregivers represents the voices of foster, kinship, guardian and adoptive families to promote the well being of children in foster care and is proud to strongly support the new permanent foster care rate structure proposal.

It is undeniable that children and youth in foster care face immense challenges and we have been unable as a state to provide adequate support and care for these youth. The proposed changes outlined in the foster care rate proposal provide so many innovative opportunities to help children and families. I will focus on a few highlights the foster care rate proposal fundamentally changes how children and youth will be assessed to determine their level of need for support and services by using a validated functional assessment tool.

For the first time ever, the cans the cans will replace the current level of care protocol tool or the LOCP. It is a key change because the current LOCP is not a validated assessment tool and is used unequally throughout the 58 counties. By using the Cans as the assessment tool, it is estimated that 19% of children and youth in foster care, or 8000, will result in a tier two placement, which is the equivalent of the current intensive services foster care rate or the ISFC rate.

Currently, only 3.5% or approximately 1400 children and youth in foster care are receiving the ISFC rate. This means that on any given day, thousands, currently 6500 children and youth who qualify for intensive services foster care are not receiving it.

Thousands of children and youth are currently not being given the appropriate level of support and services that they need in order to keep them from experiencing more traumatic events as they fail from placement to placement or failed to stay in a family home due to the lack of assistance they need to thrive. Investing in families with significantly higher rates to caregivers reflects the true need for greater support and services in family based settings than is provided under the current interim foster care rate structure.

The new foster care rates proposal is a once in a generation opportunity to finally recognize that our children and families need greater support and services in order to stabilize and improve the lives of vulnerable children. Furthermore, by recognizing and adequately funding caregivers, this proposal funds the outcomes we all want to achieve. Children should live with family in a safe and supported home setting, receiving the appropriate level of support and services in order to keep connected to their communities of origin.

This proposal does that by having the funding follow the child wherever they are, rather than the placement there. In all, children and youth enter at tier two temporarily, including when they are placed with emergency caregivers or relatives. For too long, the state's foster care rate system has missed the mark.

By not supporting caregivers up front upon the placement of a child, this proposal reverses the historical inequality experienced by relatives who are asked to care for kin, but without receiving the same level of services offered to other families who have been pre approved. As a resource parent, this proposal treats all caregivers equally. Not only does it reverse historical inequality and how relatives are supported, but the new proposal recognizes that substantial support is needed upfront from day one, regardless of where the child or youth is placed.

In addition, we celebrate the new funding to support strength building and to address a child or youths immediate needs, including those for young adults in foster care who are 18 to 21. Both of these unprecedented new funds will allow youth to deepen connections to their communities and increase their overall well being. In particular, extracurricular and enrichment activities can provide positive childhood experiences to help mitigate the effects of trauma.

In a county administered child welfare system, it is common to have significant inconsistencies in service delivery, varying levels of support for children, youth and families, and gaps in oversight and accountability, ensuring that there is state oversight, accountability with outcome data, and a model contract with standards of care with this new infusion of investment will help provide equitable support and services in all counties to all children and families.

For all of these reasons, California Alliance of Caregivers strongly supports the new investments in the future of our vulnerable children and youth outlined in this proposal. In conclusion, we thank our colleagues for their comments. Many of their concerns can and will be addressed in implementation, and some can be addressed in TBL. Concerns about the proposal have to be weighed against the enormous life changing benefits for children, youth and families. This proposal overall is exceptional.

Thank you so much, Miss Rexford Road. Rexroad you talk about. I wanted to on the 18 and 21 year olds you spoke about. It's so great for them to be able to get the strengths building portion. They're not eligible for immediate needs under this new rate reform proposal. And you spoke about needing to mitigate the effects of trauma. Do you see that there's a need there for the immediate needs for them or it's okay to move? Not that it's okay meaning

Can I clarify? They are eligible for tier two and tier three funding in any setting other than the SILP? The SILP is really intended for the highest level of readiness and I think Chief Deputy Troia, in the last panel, spoke about the need for that readiness assessment. So the silp rate has always been limited to the basic rate in recognition of that. And in this case, that would be tier one, but for any other setting.

So for youth in our transitional housing programs, they could also receive the immediate needs. They would receive the immediate needs dollars if they were assessed into tier two and tier three. So it should be additional support for youth in that setting that's already supposed to be providing that additional level of support to make sure that they're being responded responsive to the immediate needs of those youth in addressing their transition.

What about for those that perhaps are pregnant?

There's still going to be the expectant parenting payment and the infant supplement. There are proposed no changes to those dollars.

Thank you. We're good.

Yeah. And furthermore, we do believe that 18 to 21 year olds who would be assessed at the level two or level three should be in a more supportive environment. And we do need more capacity for THP.

What's THP?

Oh, sorry. Transitional Housing Programs.

Thank you. Our final panelist from Youth Law Center.

Thank you. Thank you, Madam Chair. And Senator Roth. And I just wanna start by saying that your breakdown was actually the most rational statement on the current State of affairs in the state that I've heard. You know, in times of crisis, the logical and rational approach would be to identify who's most vulnerable and who's most at risk and protect them. They, our young people, you know, have the most to lose from all of the cuts and the most to gain from all of the intervention.

So I want to thank you for your leadership and just say that you have democracy over here. If we had advocates, as we do right now, in the legislative and the Department, sort of widespread, we'd be having a very different conversation. Right.

That's why I want more social workers to run for office.

Yes, yes. Sign me up to support you in any way. So, thank you so much for taking all the time to focus on this really important issue. My name is Jennifer Rodriguez, and I'm several relevant roles, I think, for the discussion that we have today. I'm a lawyer. I'm the Executive Director of the Youth Law Center.

We are a national legal advocacy organization focused on both protecting children and youth in foster care and juvenile justice from harm and making sure that they get the supports they need to thrive.

And I'm somebody who grew up in foster care myself and have spent the last 25 years working closely with the Legislature, with the Administration, with counties, and with other stakeholders to try to reform foster care so that it is child and youth focused, not focused on the needs of adults or bureaucracies or placements, but really focused on children and youth.

And I believe that the proposal that you're having, that you're seeing in front of you, like you've heard from other speakers, that this is really a once in a generation, unprecedented opportunity for an entirely new approach that is strength based.

You know, I won't repeat the things that other folks have said, but I will say that we for a long time have had a rate system that incentivizes us identifying what's wrong with children and youth and sort of being able to resource only at the point where things have completely fallen apart and where we've failed you to the point of crisis.

So that's one area that's really important to me, and the other is that this proposal makes good on the directive that the continuum of care proposals gave to us to make sure that our fiscal funding and our policies are aligned with this goal of making sure that our system is revolving around families and that every single child and youth who's in foster care has the opportunity to live in a family. And you heard Mister Center earlier.

I don't have to tell you that Mister Center and all of the families, whether they're kin or resource parents in our system who are caring for children and youth are not beds, they are not placements. They are the most powerful intervention that we have to offer when we have to bring a child into foster care. And so we need to be doing everything in our power to make sure that our dollars are supporting them in this work. They have held through COVID.

When all the rest of our systems shut down, they are holding through now. I love that when he described his son, that he said he is so 13 because they are basically the only folks in our system who will see our children and youth as teenagers, as 13 year olds, not a collection of the worst things that they did or the worst things that happened to them on their worst day.

So all of that to say, I don't want to repeat what other folks have said, but I do just want to give some context for why we are so excited and why this has been our number one priority moving the rate structure forward this year, which is that I really want to emphasize how drastically different this proposal is from the one that got us where we currently are today in foster care, which is a lot of crisis, where we are seeing families struggling with the desperation of not being able to get the resources they need until things have completely fallen apart, or we're at the point of crisis with families not being treated as the primary intervention and partner with child welfare agencies, but really as a bed that you can move children in and out of, or at best, the glorified babysitter.

I began my advocacy as a youth Member of the California youth connection 25 years ago, mold now. And when I started, I was really determined to work so that if a child or youth had to enter foster care, that experience wouldn't cause additional pain, devastation and harm.

And at that time, when I started my advocacy, it was widely accepted that basically once you graduated elementary school, and particularly if you were black or brown, that the plan was going to be for you to live in congregate care period in our system. And that meant that we would miss out on the experience of being part of a family and all of the stability and relationships and regular child experiences that involved.

When I actually worked on my first Bill in CYC, which was back in 1999, the foster care Bill of Rights, we believed that we needed the to force systems to recognize our right to live in a family, to have our relationships protected, to be able to participate in extracurricular activities, because the financial incentives, the practices and the policies that were in place, they actually made it easier to institutionalize us and to not do those things than to do them.

And so as someone who as a result, spent all my years in foster care, in institutions, institutional placements, group homes, shelters, psych hospitals, by the time I was a teenager, Juvenile Hall and predictably exited completely alone to homelessness and lots of struggle.

It was really hard for me to imagine when I started my advocacy, that there would be a day when the system would like loudly and proudly proclaim that every child and youth should live in a family, and that our policy and fiscal framework should reflect that goal, ensuring that we resource families, families with the supports that children and youth need and that will allow them to thrive in a family from day one, not on the day when everything falls apart and we suddenly decided that they're too complex to serve, but from day one so that they can heal and find stability.

And this is why I'm so hopeful and excited about this new proposed rate structure it creates. Our final thoughts awaited first attempt at a fiscal structure that allows us to finally start building the system. Schedule capacity to put needs first. We're deeply grateful to the department's leadership in doing the work to create an inclusive process over the last two years to work with stakeholders. I know that many of the areas that we're excited about depend on how implementation rolls out.

I can assure you we, as well as other advocates will be right there in implementation. We will be raising our hand and coming to you all to hold the Department and other stakeholders accountable if implementation does not roll out with the values that we had in mind. But we are overall very, very excited at this, you know, real, real effort to try to prioritize children being in families.

Thank you so much. I have some other questions I forgot to ask on the spending planning manager, who is eligible to be that?

So in the Trailer Bill, it's very broad because we want to make sure that when we put the RFP out, that we can sort of have solicitations or bids from, like, a lot so that we can really find the right entity and organization.

So a nonprofit would be.

It could be a nonprofit. Exactly.

Okay, great. I think that might have been my last question. I just want to. I know, and we spoke about this. It's very similar. We're taking notes from our other Department, DSS, ensuring, because this is similar to their, their self determination programs and the IPP meetings that they have, and ensuring that the spending plan manager where in this case, potentially a nonprofit, hopefully we can avoid some of the problems we see there, is really just getting the dollars out to the individuals so they can have their resources, their extracurricular activities up front and not be stuck with the Bill that we're seeing in that situation. I think that would be my only.

You're describing our vision. Yeah.

Great. No, again, really excited about this. I want to thank everyone. I heard you on added language to see how we can continue working with the counties on those points on strtps. I heard you as well. Thank you so much for coming and speaking about how this would be transformative for people who are experiencing what you experienced before. So thank you so much for sharing your stories. That concludes our panel for this topic. Move on to issue number three. And Director, you may begin.

Thank you, Madam Chair and Members Kim Johnson, California Department of Social Services. So here we are talking about the Bringing Families Home program, which provides housing related financial assistance and wrap around supportive services to some of the most vulnerable families in California, those experiencing or at risk of homelessness who are involved in the child welfare system. The goal is twofold, to keep families together, as well as support them in remaining and becoming stably housed.

The budget acts of 21 and 22 provided a total of $185 million in one time funding to this program. Through the expanded one time funds program scaled from 22 counties and one tribe in 2019 to 2020 to 53 counties and 25 tribes. In 22-23. In fiscal year 22-23 the program served 1996 families. There are currently 2855 active families across the state as of December of last year and fiscal year 22-23 families exiting the program, over half exited to permanent housing.

According to preliminary findings from the evaluation conducted by UC Berkeley, California Policy Lab and University of Southern California Children's Data Network, enrollment in this program reduced the use of emergency shelter and transitional housing by 50% and doubled the use of evidence based rapid rehousing services in the six months following program entry. Most families, 52% that exited the program by the end of the program's second year left to permanent housing. Only 3% reported exiting to homelessness.

Bringing families home families with a child in foster care and receiving family reunification services were 68% more likely to have a family reunification than non participating families at six months following program entry. Additionally, according to a recent study published by Chapin hall at the University of Chicago on San Francisco, 86 of the 145 children and families referred to bringing families home with a family reunification case had exited care by December 1 of 2022.

A majority of children were reunified with family, and most others exited via adoption or legal guardianship. Furthermore, a large majority of participants that exited the program within the study's observation period were able to obtain housing. Additionally, 81% of those participants who obtained housing were stably housed six months after program exit. In terms of the Governor's Budget proposal, and I want to just note, all program funds that have been made available for local assistance have been allocated to grantees.

Of the $185 million allocated, 165,750,000 have been provided in a total of 53 counties and 25 tribes. As of June of last year, $23.9 million had been expended at that same time period. The amount remaining from 22-23 and 21-22 is 141.8 million. So again, the proposal is to delay $80 million of funding, and it's intended to smooth out funding into fiscal year 25-26.

Based on how expenditures have been trending to date and providing grantees an additional year for expenditure, we're extending the timelines for an additional year where normally it would have ended in June of 2025 to June of 2026. We are not proposing to reduce spending for these programs. We're not intending to limit service delivery for participants, as you just heard me list the outcomes and success to date, and we recognize that the proposal and the dollar amounts included were based on one time point in time data.

We plan to revisit that in the May revision and update accordingly. We are working with counties and with the County Welfare Directors Association as well. And so as we're getting more fine tuned on the actual numbers, those would be updated in May Revise and looking at redistribution also that we've talked about earlier in this hearing today.

Department of Finance and additional comments.

Marlon Davis, Department of Finance, no additional comments at this time.

Thank you, Angela Short, LAO. As you just heard from the Department, our understanding is that the intent of this proposed delay really is to reflect actual expenditures and achieve some savings in the budget year, not actually to reduce overall funding for the program. So we agree that if this delay can be implemented without negatively impacting beneficiaries or disrupting service levels, that it certainly seems to make sense given the current budget situation.

As you also heard from Director Johnson, something we've also been wondering about is given that different counties are spending their allocations at different rates, just is there any additional work that needs to be done, perhaps with the May revision proposal to ensure that any redistribution that would be helpful to ensure that smooth continuation of expenditure is occurring? So that's something we'll be looking for at May Revision. But overall, we agree the delay proposal seems to make sense.

Director, that was going to be one of my questions if we were looking at redistributing funding across the counties to balance it all out. That's right.

And we have been in the conversation with CWDA and counties related to that. So as we see any particular given county reaching their expenditures at a higher rate sooner, we'd want to have some ability to make sure we can move resources around with this, the appropriation.

And this was always a one time Fund appropriation.

So we are anticipating a cliff happening. What's the plan for the participants in the program?

Correct.

Again, you heard me give the outcomes in terms of stability and where we are transitioning people. I think what we've heard, and even in this proposal, that counties are wanting to really understand appropriation allocation to be able to determine who they can newly accept. I mean, I think that's the consideration going forward.

We also want to make sure we are able to demonstrate to the Legislature and public more broadly the outcomes of the program and whats working to determine if there are other ways that we could sustain any level of resource and or look at other funding components that exist that could be modified to meet and be tailored to the needs of this population.

Thank you so much. Were going to hold the item open. Move on to issue number four.

Whenever you're ready, Jessica.

Good afternoon and thank you for the opportunity to speak here today. My name is Jessica Rougeux. I'm the branch chief of the Child Welfare System Branch at the California Department of Social Services. I'll be speaking this morning about the budget change proposal for the Child Welfare Services California automation.

Are you putting the mic right in front of you?

Yes. Thank you. Is that better? I'll be speaking this afternoon about the budget change proposal for Child Welfare Services for California automated Response and engagement system, also known as CWS Cares. The CWS California Automated and Response Engagement System project is to implement and modernize the system to support Child Welfare Services statewide.

CARES will be a statewide case management and data solution that incorporates capabilities not achievable through the existing Child Welfare Services Case Management System, also known as CWSCMS, essential to the delivery of tailored, high-quality Child Welfare Services and to ensure compliance with the comprehensive Child Welfare Information Systems requirements and to maintain our federal financial participation and related requirements. This modernization will assist in improving data collection and monitoring of child and family outcomes, service delivery and implementation of new child welfare initiative statewide.

It directly benefits child welfare workers by removing duplication of efforts, streamlining business processes, and ensuring that children and families won't have to repeat information over and over again and feel heard and engaged and decreasing the impact of the trauma they've already experienced. I'm going to hand over to my colleague.

Hi, my name is Cynthia Tocher. I'm with the Office of Technology Solutions Integration and I'm a Deputy Director over this project. And so, in the support of these programmatic goals, this proposal requests support to continue with these essential work on CWS cares solution and with the implementation of CWS cares, the state would be able to decommission the legacy system already stated to CWS CMS. This project or this proposal has requested 225 million in total funds.

Includes funding authorized in the provisional language for the state fiscal year of 24-25 which includes like five new positions to support state, county and vendor activities for the continued design, development, implementation of this system. So that is for our first. Oops, got a scroll.

And then with regards to the 2023 Budget act appropriation, spending, etcetera. So as of the end of March March 22, the project actual expenditures and approved invoices are about 77 million for the Budget Act appropriation.

As of now, we do expect to use the full budget based on ongoing current work and the timing of when we expect to receive those invoices, the amount of time it takes to do past year close, as well as the invoice processing timeline affects finalization of our actuals, the timing of them for a fiscal year.

Okay. And then in terms of the timeline for the project. So CWS CARES version one is planned for a statewide go live in October of 2026, which is aligned with the special project report, or SPR six, approved by California Department of Technology on May 12, 2023.

And we think that it's important to share with you additionally, based on the questions that had been asked, is focus on that CWS cares is being leveraged to support statewide initiatives such as the foster care rates proposal we've been discussing today, FFPSA prevention services, federal claiming, and other child welfare improvements that are being timed for implementation with the automation.

This supports the program in providing required time to develop program policy evaluation criteria, ensure operational implementation is ready to go, and that we have more than adequate time to meet with all system partners in preparation for that work. CDSS has worked to avoid delays in program initiatives by developing interim solutions.

So as an example, in the case of FFPSA part one prevention services, we have included in Governor's Budget the block grant expenditure authority, being moved out through June 30, 2028 and the total amount of the block grant is 222.4 million to support FFPSA implementation among the counties as an interim solution until federal claiming can begin with the coinciding with the version one of CARES being released.

The version one of CARES is going to be released in 2026.

It's set for October 2026.

And you need this to go into 2028. Why pass the...

The block grant extension? I think, and I can, you know, refer to Angie if she would like to, but the intention behind the extension was to make sure there's more than adequate time. So in the event there was any transitionary period that was needed to support counties and that claiming.

Not because we think part one is going to be, need to extend to 2028.

Correct, I think it's meant as a safety, a safety net or a stopgap in the transition period.

Okay

And with the CARES V1 statewide implementation, the state will be able to draw down the federal funds for the matching for 4a and 4b.

Mr Davis, any additional comment?

Marlon Davis, Department of Finance no additional comment.

Mister Metzger?

Yes. Brian Metzker, LAO based on our review of the annual progress demonstration that was held earlier this month, as well as project oversight documents, we find that the project is making progress largely in line with the baseline cost, schedule and scope. However, there have been recent indications that the project may be veering a little bit off course.

There are some issues and risks that could impact the project schedule, but those are still being mitigated and still being discussed at the project level, and there's active negotiations and discussions about those. I was glad to hear today the updated numbers on expenditures, the 77 million. We still would ask that the project provide a monthly kind of plan for those expenditures because right now those expenditures are still quite Low relative to what's budgeted.

We understand there are month to month changes that could affect those expenditure numbers, but given the immediate budget problem, it would be helpful to have those projected expenditures for the rest of the current fiscal year.

We have requested that, haven't we?

We have, but I have not seen that to date. So that is something I think would benefit the Legislature.

Yeah, because, I mean, I did read we have requested monthly spending projections for the current fiscal year. When do we anticipate getting our first one?

So we are working with Department of Finance with regards to our overall, all the work that is going on for this current fiscal year, and we currently do expect to expend all of the funding for it.

Right. But when do we get, when are we getting the. We're supposed to be getting monthly spending projections once and we haven't received the one.

Kia Cha, Department of Finance. Let us get back to you on that.

Just one additional comment is that as part of last year's Budget act, there was provisional budget Bill Language that was adopted that was conditioning a certain amount of funding, 35.1 million, on the demonstration of verified satisfactory progress. That was the terminology that was used with specific kind of parts of that. What does that mean? Right. And to our knowledge, that has not been requested. That augmentation of the 35.1 million has not been requested yet.

So we would ask the Legislature request an update on whether that money will be requested and when, because it will be important for us to understand what, what the Administration deems satisfactory progress based on what was adopted last year.

Can you say that to me again in a different way?

Yeah. Basically, last year there was a discussion when CWS CARES came before the Legislature at May Revision about the fact that we have spent hundreds of millions of dollars on this project and we have not achieved completion of the project. And so there was an interest in the Legislature adopting a way of defining what it means to make satisfactory progress towards completion. Right. And so there was language drafted and a certain amount of money was conditioned on showing us what that progress looked like.

To date, that amount of money has not been requested, and it seems because the expenditures are not tracking, like, on budget, that that is causing potentially a delay in them requesting that money. And so.

And we don't know when that request. Is going to. Do we know when that request is going to come in?

I would defer to my colleagues.

Yeah. Kia Cha, Department of Finance. I think that's something that we're still looking at, so that'll be forthcoming.

Okay. Okay. So we're waiting on the reports when the first one's going to come in and a timeline on when the report potential requests. If it's our next budget year, would it be this?

We're kind of working through that now, so we're hoping to get you guys an update.

Okay. Yeah. Do you anticipate during the May revision revise?

I can't say with certainty.

Yeah. Okay. Thank you. Were you done with your comments? Great.

Angela Short with the LAO. One other comment we did want to make here is related to the foster care rate reform, which we were just talking about in a previous issue of this agenda. As we discussed, there are many details that are still very much live and being worked on currently in terms of the support, specific details of that proposal.

That said, we did want to flag, it's possible that new functionalities could be required of CWS CARES depending on the details of the new foster care rate structure. For example, you know, the strength building component. This is a brand new component that is not currently a part of foster care rates. So we do have some questions around whether additional development automation could be required to be able to implement the new rate structure.

We would note the Governor's Budget did include $12 million General Fund to begin new automation in CWS CARES, as well as Cal Sols related to the new rate structure. But it's unclear to us at this time if that is intended to cover the full extent of new required automation. So that's just something that we will be working to fully understand, and it will also depend ultimately on the final details of the CCR permanent rate structure proposal.

Okay. And, Director Johnson, maybe this is a question for you, that 12 million requests, is that for all anticipated automated needs?

Yes.

Okay. You could have just nodded. There we go.

Also wanted to clarify that that is a placeholder, and the automation costs really can't, won't be finalized until we kind of finalize the framework.

So. Okay. Okay. Thank you for that. Okay. No further questions. We're gonna hold the item open and move on to issue number five. Families First Prevention Service Program extension. Welcome back.

What is now good afternoon. Chair and Members of the Committee Angie Schwartz, Deputy Director over the Children and Family services division at the Department of Social Services. This proposal requests to extend the expenditure deadline from June 30, 2024 for the state Block grant for the Family First Prevention Services act to June 30, 2028. It's in support of implementation of those prevention services.

The Budget act of 2021 provided 222.4 million in General Fund with three years of expenditure authority to support activities related to the period of time in which we'll be able to start claiming for federal dollars under part one of the Family First Prevention Services Act. California has allocated that block grant to all 58 counties to support county child welfare and probation, and tribes with Vori agreements in their efforts to establish new community based services and to leverage existing collaborative, cross sector approaches to prevention services.

We anticipate that counties will utilize some of the state block grant allocation to Fund services that were included within their local county prevention plans and submitted to CDSS for review and approval. As of April 22, 2024 we've approved 51 local county prevention plans, including two submitted from the Karuk and Yurok tribes. This allocation of resources strengthens the state's commitment to prevent child abuse and neglect in entry into foster care by empowering families and providing them with the necessary services and supports for their communities.

The extension of the block grant funding expenditure deadline is crucial to uphold our commitment and vision for prevention efforts. If it's not extended, our commitment to counties, families and parents, youth and children will be jeopardized. We know that the timing for being able to claim funds under part, part one is commensurate with when cares will be implementing, and you're just hearing from that on the panel.

And then this extension of the expenditure deadline will give that additional couple of years to make sure that we can sort of bridge that period of time from the block grant over to those four e claims. Happy to answer any additional questions.

I know you gave an overview, but what kind of programs do we know they're new programs. Do we have any idea what kind of programs that this blood grant is funding?

There's all kinds of different programs that counties have put into their comprehensive prevention plan. So it's like strengthening families or healthy or parents as partners, I think are two that are in many, many county plans, but different counties have identified sort of a different array of different kinds of prevention services.

Could LA County Fund their LA Public Health Nursing Intervention Program with these funds?

So these are intended for prevention programs and so it's possible this is one time dollars. And so while we're asking for an extension of the expenditure timeline. These are dollars that are not ongoing. It was a block grant that, like I said, had three years of expenditure authority. And then our proposal is that it gets extended.

Okay. Okay. And why, having counties spent all the money.

Counties had to put together their comprehensive prevention plans, and they had to do so in consultation with their interagency leadership teams and inclusive of consultation with their tribes. And I think that was a really important process of engaging with the community in order to put together those comprehensive prevention plans. It also meant there was a delay in getting those submitted. As I said, at this point, we've had 51 approved, and so we are seeing the claims starting to happen.

But I think some of that's just the natural ramp up to developing these kinds of programs and services.

Okay. Department of Finance, any additional comment?

Marlon Davis, Department of Finance. No additional comment.

You don't have to say your name.

No comments at this.

Okay, thank you so much. We're going to hold the item up and move on to issue number six. All right.

This proposal is for an increase in reimbursement authority of 1.1 million in 2024-25 and 1.1 in 25-26 and ongoing to address the workload associated with federally mandated activities for the Child and Family Services review. Case review allocation adjustments is for the funding authority. The proposal is for six new positions that will be completing the CFSR case reviews and quality assurance for small, small rural counties who are currently contracting back, plus an additional five counties who are interested in contracting back with us.

In order to complete the reviews on their behalf, these positions will develop resources and desk guides for completing onsite reviews. Without the requested resources, we risk being out of compliance and risking federal penalties. We will manage positions within the existing authorized positions until the majority of our vacant positions are filled with. Happy to answer questions.

Any further comment?

No further comments.

We would just note that this proposal has no General Fund impact, but no concerns to raise at this time.

So I don't have any questions. All right, thank you. Gonna hold the item open now we're gonna moving on to child care issue number seven, where they put eight, starting with eight. I even gave myself a moment. Yes, we're going to start with the overview, so if Department can join us.

Good afternoon. I'm Doctor Lupe Jaime-Mileham, Deputy Director of the Child Care and Development Division at CDSS. The Governor's proposal budget includes 6.7 million for child care programs and 24-25. These funds include the remainder of federal pandemic relief funds. The Administration is aligned with the Legislature to prioritize the spending of these temporary COVID-19 funds and as such, the pandemic relief funds have been obligated through contracts.

In response to question number three on the agenda, CDSS has obligated and intended to liquidate all available federal funds by their liquidated date. The Department will continue to prioritize the stabilization dollars discretionary funds that are required to be liquidated by September 30 of 2024. New CDSS funds will not yet be received and will be accounted for in the state budget upon final award anticipated in summer of 2024. For the response to questions 1 and 2, since all funds are obligated, they have been placed into contracts.

The CDSS will contract conduct. I'm sorry. CDSs will conduct an updated expenditure analysis in May of 2024 to project the amount of remaining funds by source. The Department will then perform expenditure shifts in August of 2020 to finalize and ensure that federal funds are liquidated before September 30 of 2024. This concludes my remarks in regards to the questions.

Department of Finance.

Tamar Weber Department of Finance I just want to underscore that the Administration chairs the Legislature, the Legislature's priority to make sure that we spend down all of the, any, all of the federal funds that are available. And like Deputy Director Jaime-Mileham said, we're working right now on getting an update for the May Revision.

Okay for the May.., but I was hearing dates of August and September. It seems like that'd be past us potentially getting some savings this fiscal year, right, if we're looking at August and September.

Gabby Santoro, Department of Finance, just to clarify, what we're anticipating to do is to anticipate those savings as part of the May revision that will be occurring after. But we want to anticipate them with estimates for the May Revision.

Great. Thank you so much for that clarification.

Jackie Barocio, Legislative Analyst, office as part of the overview, I'll just walk through the table that's on page 39 of the agenda, figure four. That reflects, based off of our analysis, potential one time General Fund savings that would be beyond what's included in the Governor's Budget. Overall, we've identified potentially $1.0 billion in one time General Fund savings within the child care program. Most of these funds are just due to actual program costs coming in lower than budgeted levels.

A lot of that has to do do with just ramp up of the new slots taking time. I'll just comment on a few of the listed items that are in the table. First with the Proposition 64 carryover funds. There is a balance of unspent funds of dollars from Proposition 64 that have been appropriated to childcare. I will flag that these funds are continuously appropriated, meaning that they're not allocated through the annual budget process.

The Legislature, because of that, they would just have to work with the Administration to have any of these dollars be administratively allocated to potentially offset any General Fund costs that are within the child care program. And then that would achieve, you just.

Don't know how much hasn't been spent. Is that what you're saying? Or is it 15 hasn't been spent?

Our understanding is based off of the Administration's estimate of potential Proposition 64 carryover balance by the end of 23-24. It's 415. It's just a matter of how do you go about allocating those dollars? It wouldn't be through the budget process. It would have to be done administratively.

Got it. Thank you.

Also included in our table, and as was mentioned by the Department, there's also potential to do expenditure shifts of unspent federal funds, including those temporary COVID-19 dollars that would otherwise go unspent and revert back to the funds Federal Government. We can just replace and offset that federal fund for a General Fund dollar. We could also, to the extent that there are savings in other fund sources like the General Fund, just revert those dollars that are either have gone unspent or projected to go unspent.

For example, in the table, we do flag that last year, as a part of the last year, or in 22-23, $40 million of Emergency Childcare Bridge funds went unspent so the Legislature could revert those dollars. And they're also just flagging within the Emergency Childcare Bridge Fund potential for another $30 million that may go unspent in 23-24 just because actual service levels are still coming in below budgeted levels.

But it sounds like, of course, that may be a part of the administration's may revision update about their overall unspent calculation, which we will analyze and provide comments to the Legislature at that time. I will also note, because your agenda does touch on it, some change in the implementation date as it relates to the alternative payment slots. So I did just want to touch on it and to provide context.

And last year we delayed adding any additional slots to programs, including the alternative payments, in order for the field to catch up and fill previously budgeted slots. The Governor's Budget does assume that for the alternative payment program, they are on track to fill all previously awarded or budgeted slots. So then they're scheduled to release the agreed upon 16,000 and additional slots next year.

However, they are assuming an earlier implementation date of July 1, 2024 where in the past, we've always assumed that new alternative payment slots would be implemented October 1. So by assuming a three month earlier implementation date, this increases General Fund cost by $46 million for 24-25 and then they would continue this earlier implementation date and in future years. So that would also be an annual increase in future years when we do add slots.

While the early implementation date may have some administrative efficiencies, we just flag that one. The new slots likely would not take effect July 1 because it just always naturally takes time for agencies to receive payments and once they receive payments, to then recruit families to fill those slots.

But then also, if we're assuming a July 1 date moving forward, that essentially means that the Department will have to start awarding and allocating these slots and contracts prior to July 1, which is also prior to the legislative approval of the budget and the funds that they're going to start committing. So for that reason, we just find that they may be getting ahead of the legislative appropriation authority.

So it'd be better for us to just. Just keep the three. Was it September? Yes.

So that gets me to our recommendation, because, again, we're also. This is resulting in an added cost in the time in which revenues are coming in where we may not be able to afford existing commitments. So for all of those reasons, we just recommend that the Legislature continue to assume the October 1 implementation date, and then that would also result in additional $46 million in General Fund savings. Thank you.

Thank you so much. Department of Finance. $1 billion. That's a lot. Did we know this? I hope we knew this.

So we're working on trying to track exactly how much money is available for those shifts and then how much General Fund will be available because we've shifted in the COVID relief funds.

Okay. And, you know, obviously our goal is to use all those funds first before going there, and then do we anticipate a robust understanding of this in the May Revise? Okay, great. And then I'd like to hear a response from the Department regarding the three month, the need or our perception of why we needed to do three months earlier.

Yeah. So a couple reasons in regards to the three months earlier. One is by keeping October 1 of 20, October 1 as the date, then what was outlined by the LAO would apply then for October 1, meaning contracts will still need to be released, have to be ramped up, and et cetera. So in a sense, contractors are not enrolling families until months later by shifting it to July 1.

That provides then for us to be able to work on allocation sooner, subject to, of course, budget negotiation. We don't want to get in front of what in regards to the Legislature and the Administration process, but it does help us get those dollars out a lot sooner, which we know families are waiting for these funds.

But how would we do that if we can't get a hold in front of the budget process? And you would only have what? Weeks, two weeks if that?

Yeah. It has to do with pre planning, making sure that we are pre planning for this for the best scenario. But contracts will not be released until that is finalized in regards to the process.

Okay, so you believe in keeping the July date, that by that date on July 1, if it's July 1, that the funding will go out.

The intent is to work towards having it wrapped up in the month of July. Correct. So the sooner the better. And this is all based on what we received as feedback from the field when we were looking at why slots were going out the door later. We wanted to make sure to meet that need by then, in a sense, getting these contracts out sooner to them.

So it does, like you mentioned, become a little tricky in regards to making sure that we're not getting in front of it and, and that is not our intent nor we want to process any, get any, release any contracts before this process is over. But there is a lot of pre work that we can do to make sure that all of that aligns nicely.

Okay. I just want to make sure if we're telling the providers July and, you know, the crunch of the budget process limits our time and providers then come back, hey, you said July. We're anticipating for July, and then it comes out to be August or September. We want to make sure that we're prepared for that or to avoid that.

Right, exactly, exactly. And understand what you're raising, too. Recognizing, though, keeping October would be exactly the same type of conversation. Right. Making sure that those, what happens in October is that now we're not. We're doing amendments versus contracts, which now requires a whole nother process to augment their current contracts. And now that adds more time and also delays the payment to the two contractors.

Okay, how much time is needed for the ramp? Like you said, the pre work.

The ramp, it varies. There are some contractors that are equipped to be able to start enrolling as soon as they know the budget is signed in good faith. Right. And there's others because of Boards and other reasons may take, take a little bit of time to make sure that they receive contract in hand in order to be able to continue to make these enrollments.

Okay. Jackie, I don't know if you had any additional thoughts to that.

I did just want to provide context in terms of July 1, October 1, in terms of what practically happens, regardless of what date you choose. I think what we've also heard from the field is that's not necessarily a guarantee of when you'll actually get the money. A lot of this, most it's just for budgeting purposes of how we display the dollars.

When you actually get the money does depend on when amendments or contracts are finalized, and there could be delays to that, but there also could be delays to receiving payment as well. So even under an October 1 date, what we've heard from providers is, if everything goes ideally, well, sometimes there is even a delay in still receiving the contract.

So they won't even like, October 1 isn't necessarily a realistic date, but what we've heard from them is at least October 1 does seem to be a bit more of a realistic date because, yes, you have to amend contracts where it would have been easier to bake them into initial contracts that you're finalizing in the spring and then releasing in the summer. But at least that amendment is, from the Legislature's perspective, is actually based off of approved dollars.

So to the extent that the budget lags and July 1 we're still process or in negotiations of how to finalize the child care budget like we were last year, I think we just have questions of what does that mean for the release of contracts, especially if there's a scenario in which a different dollar amount is approved than what's been proposed. To what extent do we then still have to amend contracts or how do we go about that process? We just find it's a clear, cleaner process if those decisions are finalized before any contracting actions take place.

Okay. Thanks, Jackie. And so the last, I don't have any further questions on that part. But the last thing I just want to say, I just want to confirm, clarify that in may revise, we're going to look at how much we can score from this approximate $1 billion savings in the child care space. And we'll see in may revise your proposed plan on how to reallocate some of the funding because we're going to score all the savings this fiscal year.

That is what we're evaluating and trying to do right now.

Okay. Okay.

And then I will flag that our estimate was based off of January expenditure trends. So it is possible that their May estimate may be different, but we'll, of course, in our analysis, try to identify the reasons behind that to help the Legislature understand.

Okay. Senator Roth, we okay?

Yep.

Great. Make sure. Okay, we're. No further questions on issue number seven. Moving on to issue number eight, our Child Care Rate Reform Update conversation. Welcome Director Johnson.

We have a brand new Department speaking to us here today. Welcome to Sub three, where we rock and roll.

Good afternoon, chair Members. Kim Johnson, California Department of Social Services. Our second conversation related to how we are reforming the rate structures of systems for children and families this morning, and I just really want to appreciate that this is another significant change that we have, many of us have been working for for many, many years. So historically, just very briefly, California has conducted the regional market rate study and has two different unaligned systems for reimbursing early learning and care programs.

The standard reimbursement rate, the regional market rate. As a condition of receiving federal funds, we have to reassess the adequacy of rates every three years. And again, our market rate surveys have typically collected the data about prices that programs charge to pay private pay families, and then we use that information for rate setting. It is widely recognized that market rates reflect what parents can afford to pay and not the actual cost of running these programs.

And so, to address the inequities of the market rate study approach in 2023, California successfully sought federal approval to use an alternative methodology as it moves to a single rate structure. With the adoption of Assembly Bill 165, the Legislature and Governor committed the state to develop and use this alternative methodology in collaboration with the Department of Education and with intensive public engagement.

We've been working hard to make this decades long dream a reality and want to also acknowledge and recognize that this is a path charted and successor agreement between the state and the child care providers united. We understand that implementing rates informed by the new cost estimation model will require additional investments. And so, as you outlined on page 44, some of the investments that we've put forward in the prior years supplements and augmentations to the existing rate structure to support programs and providers in the field.

We also have been thinking through, again our implementation piece, which I'll speak to in just a second. So, just in terms of the Committee's questions related to the process, we've undertaken again extensive public engagement. It's been ongoing since April of last year and will continue to engage community and public throughout the process.

We have completed the cost study that occurred July to October of last year, and this is actually collecting data from providers and programs, the workforce, on their current costs of operating and meeting the higher quality standards. And then November of last year through March of this year has when we've actually worked with our contractor to develop the actual cost model.

This is the tool that uses the gathered information from the surveys that were conducted and looks at the cost drivers to estimate the costs under various scenarios. And so in terms of next steps, one just say this month, April 1, the Department provided the revised child care and Development Fund plan and description of changes to draft to the Legislature. That's one of our steps. And of course, the alternative rate, methodology, and cost are contained within this plan.

We have also met with the rate and quality advisory panel to discuss and take public comment on the basin enhanced rates definitions that the joint labor management Committee adopted in March with CCPU. And that's also, of course, a public meeting with a public engagement. We'll meet again with that panel in May. So the Committee asks questions about how specifically are we engaging in discussing components for center based programs.

And of course, we recognize the differences between centers and family child care programs, as well as where they are aligned. But in terms of having input and engagement on looking at the structures and elements for centers, the rate and quality advisory panel is one way we are continuing to engage, and we have again utilized and continuously solicited input from a full universe of the workforce and programs along the way and will continue to do so.

On May 15, we will submit a report to the Legislature on the status of that draft plan that I referenced was submitted April 1. We of course, then are aiming to actually finalize and submit our plan to the Federal Government by July 1 of this year, and would also note that after that, we expect approval from the Federal Government in the fall of this year.

In our agreement with the child care providers united, we have identified that the outline of implementation components must occur 60 days after we receive that approval from the Federal Government. So that's where that more detailed specifics will be laid out. Then there will be 30 days that CCPU and the Legislature have the opportunity to review and provide feedback on what is submitted following submission of the implementation outline. Rate setting is the next step.

So all of this work is to lead us to a space where we again are informed by the cost of care and our approach to rate setting versus what I referenced as the regional market rate survey and looking at what families can afford to pay. So the MOU requires that within 90 days of federal approval, the state and the child care providers United will reopen relevant sections of the agreement for negotiations to restructure the current subsidy rate for those that are represented through CCPU.

Those that are not represented through CCPU. We are also going to, of course, engage and hold several conversations related to the rate setting process. And then, of course, the Governor and Legislature will need to actually have the discussion and conversation around operationalizing everything that had happened to date, just in terms of some of the steps of the implementation plan. Again, that's happening post approval, and you'll have an opportunity to see that. But we are looking at a variety of components to operationalize this structure.

And so it's everything from being able to say more about policy guidance, automation systems, just a variety of different components that will be needed, regulatory policy guidance, any contract amendments that are needed for those who administer the program, and then, of course, automation. So all of that implementation plan plan will be outlined in that step of the process. So that's a short version of where we are, where we're going.

But again, overall, just really excited and a much needed, longstanding change needed to address inequities in the child care and early learning system.

So all the work we've done with, you know, we hired p five and all that, the end goal is not just to have variables that would be considered, but to actually have a dollar amount.

Right. So one of the deliverables that was part of the conversation with the joint labor management Committee was to actually define base rate elements. So these are things like ratios and group size, staffing patterns, salary compensation and a number of other elements. And so within the information that we outlined, we essentially have the universe of options that we'll be looking to. There is another step, and this is part of our conversation and rate setting as well.

What are we going to select of the things that we have identified together? What will be the final decision points that will be selected? So the tool itself allows you to select different components within it that work is established for representative providers. And of course, we're having that conversation on the center front right now. And then we'll use the tool to actually then identify and then negotiations to establish rates.

Okay, we'd like to welcome our guests here. Department of Education. Welcome. Just kidding. That's what I was like. Why do you look so familiar? You're not from the Department. I was like, I've seen you before here. I was like, okay.

Thank you so much, Madam Chair.

With CCPU, because you're wearing purple. I was just assuming.

Purple is the color that I pulled out of the closet this morning. Good afternoon, Madam Chair Members. Virginia Early with the California Department of Education on behalf of State Superintendent of Public Instruction, Tony Thurmond. So, in line with the remarks made at the closing of the Senate's regular session today, I would like to dedicate this testimony to Delaine Easton, who passed away yesterday.

Delaine Easton was a trailblazer and an education leader who will forever inspire us as our first and only state Superintendent of public education, who was a woman, she was a champion for children, early education, and universal preschool and left a lasting mark on California's education system. We will sorely miss her.

Thank you for that.

In terms of rates, CDE has been collaborating with DSS in every step of the process that Director Johnson just mentioned to ensure that the expertise on the California State preschool program, which CDE administers, is included in the process of developing a new structure that will apply to both the California State Preschool Program well as Child Care Programs.

We are happy this work is ongoing because we regularly hear from our contractors that the low rate in the California State preschool program is making it challenging for them to recruit and retain qualified staff and recover from the pandemic's impacts on enrollment. While the one time cost of care plus rates that we have now are helpful, contractors have shared that it is challenging for them to increase salaries with funds that are not ongoing. To truly increase salaries requires an ongoing commitment to funding increases.

We've been working closely with DSS starting on the 2022 rate and quality Workgroup that Director Johnson mentioned, which produced recommendations on creating a single rate structure that addresses quality standards for equity and accessibility, and we've continued this work as a Member of the Joint Labor Management Committee on Rate and Quality Quality and the ongoing rate and quality advisory panel whose charges to, of course, build on these recommendations, provide panel Member input and public input on the alternative methodology process, especially incorporating center voices, as those are not part of the Joint Labor Management Committee.

In the coming months, CDE is focused on ensuring that any rate structure capture the true cost of care and that reflects the cost of the California State preschool program requirements, which in some areas are different from those of the Department of Social Services programs and different from voucher and private pay centers and family child care homes. This may mean that the rates for CDE and DSS programs will need to be different to capture the differentiation and requirements.

While the final structure and rates are still up in the air, we did want to highlight briefly that CDE will not be able to make data system changes immediately, and the timeline associated with the data system changes and the additional CDE resources needed to accomplish these changes will depend on the exact nature of the changes required by the agreement, which are unknown at this time.

So, for example, if the final rate structure requires data that the current data system does not collect, it may be necessary to create a new fiscal data system rather than adapting the one that the state already has, which would take additional resources. Happy to answer any questions at the appropriate time.

I'd just like to provide a bit. More context on what we could expect. July 1, 2025. I think specifically July 1, 2025 the Federal Government does require states to determine payment rates based off of alternative methodology and then submit an implementation timeline Association with those rates. That doesn't necessarily mean that the rates would take effect July 1, 2025. As other panelists have alluded to, the timing, the implementation and the timing in which the rates would go live really would depend on the results of collective bargaining.

Also, the time it may take to make any necessary system changes, as the Department of Education noted, for their own purposes, and also potentially on the Department of Social Services side. And then lastly, if and how much funding is provided in future budgets to support the implementation of the new rates. Thank you.

Thank you. Now from CCPU.

Good afternoon, Madam Chair and Senator Roth. Good to see you. I'm Dion Aroner, and I'm here on behalf of the Child Care Providers United, which is a joint organizing agency effort of Service Employees International Union locals 99 and five to one, and of united domestic workers who are affiliated with AFSCME. It's the only joint organizing effort in the country, right. And carries with it that special role, right. In representing the 40,000 family child care providers that are in our unit.

In terms of CCPU's role in this process, we've concluded our JLMC, as you've heard, shortly after the March hearing. In our JLMC, we defined key elements, including additional considerations for family, friend and neighbor, the P5 survey, right, which is here, okay. Incredibly lengthy document which gives us incredible amounts of information on providers, on the community status, on families using care where children are cared for, etcetera.

It has more information than we've ever had, actually, on the families that we serve, let alone the providers that provide the services. There are recommendations from the JLMC on the base rate elements and how to apply them to title 22, title five, and to family, friends and neighbors. You heard Miss Johnson refer to that. The JLMC developed a list of variables. You can call that factors. We can all use different names that should be taken into account when figuring out the actual cost of care.

These include, but are not limited to, wages, benefits, hours of operation, training needs, family engagement, educational development, child health, operational cost, etcetera. There are no actual values in dollar amounts attached to any of these factors. There is mention of a differential between one time only cost and ongoing cost. There are three enhancement factors, nontraditional hours, special needs, and transportation, but no dollar amounts have been have been assigned to anything yet.

It's our understanding that the state would continue those conversations with our partners in the early childhood education community, specifically about variables and selection points that may affect center based care. These conversations have not been limited. We have worked really closely with our partners right in the ECE community for years to work together rather than against each other. Childcare is struggling in California. It is crucial that we we all be aligned and working together.

The process for our partners has not been as robust and our understanding is that they have not been given the consideration that we have had that we have expected in this process. We do not want this process to undermine that relationship and we would encourage the state to ensure stakeholders and meaningfully heard and meaningfully heard knowing that we have a July 1, 2024 deadline.

While the elements are mostly defined, a number of crucial considerations are simply earmarked to be determined, including hours of preparation, hours of training and dollars attached. These do not need to be settled to move forward with a federal plan. However, we believe and urge the Legislature to impress upon the state the importance of finalizing these details with CCPU no later than October so that we can move forward with bargaining in earnest. Because that's when the reopener can begin.

You've asked us kind of like what do we think is missing? Alright, there's so much wiggle room in the alternative methodology at this time to ensure we meet the federal timeline. However, before we begin the reopener, we need to be more precise in our definitions of appropriately to appropriately empower the state agencies, CCPU and our ECE stakeholders to best implement this methodology. We have a number of questions.

Firstly, we know what the factors are that may be considered, but we dont know how much weight is attached to those elements. Its important that this new methodology is successful and achieves the goals we share in rebuilding our childcare infrastructure and expanding the reach to ultimately include all eligible children. However, we know that there are current budget challenges and want to be thoughtful in how we move forward to achieve our goal while ensuring stability.

Without knowing any cost factors, it's difficult to prepare for future bargaining, to make meaningful considerations in what we prioritize and to prepare our Members. We believe we should fill in the TBDs that to be determined with actual values now to better prepare everyone for bargaining over and phasing in that may be needed to get to fully funding.

I'm going to ask you to start wrapping up please.

Sure. Additionally, we have concerns about timely implementation. It's our understanding that the state has already asked for waivers for new federal guidelines meant to improve child care, timely payments and participation. Why wouldn't the state implement this over the next year as we determine and implement new payments associated with the cost of care? Other federal considerations include delinking private pay from subsidies. Is the state going to move forward on this in a timely fashion? That takes a statutory change to happen.

Most importantly, under current statute, the rates will go back to the previous contract dates on June 30 of 2025. We cannot afford to have our providers take a pay cut. Right. That's why it's so important that we have things in place so that can ensure, as the Federal Government has suggested, that providers actually get a rate increase pursuant to the alternative methodology. So our expectations are that the current MOU would serve as a floor for future rates.

We don't want the state to be able to reduce the payment to providers, which will destabilize, to say the least, industry. I have some.

Final thought.

I have some specific trailer Bill language which I'll share with staff. Right. Which covers many of the issues, because we are hopeful that you will put directions in the trailer Bill in regard to the timing of all of this happening so that we can ensure that providers are going to see a pay increase at some point on a timely, in a timely fashion pursuant to the contract.

Thank you so much. Our final speaker here from the, from Child Care Resource center.

Good afternoon, chair and Senator Roth. My name is Donna Sneeringer, and as mentioned, I'm with the Child Care Resource Center, and I appreciate the opportunity to speak today about something that I've worked on for well over a decade. I'm going to skip some of what you know, which is child care providers are poorly paid. And the PPIC just released a report estimating the average childcare wage at $18 hours. And we are losing caregivers today to fast food, who are being paid at 20.

And that is happening. And in Senator Menjavar, in your district, which is part of our service area, we've had large numbers of classrooms, dark, not because there are not children to serve, but because we can't find staff. So that is why this is so critical. The staff asked me to address a few things. I do want to say that we have all worked together on this for many, many years, and we are at a historic moment.

We are ready to work together to submit a plan to the Federal Government, but our work is far from over. We have a lot to do. And I specifically want to lift up some of the concerns from the center based community who have not necessarily been included in the way that they could be. As you know, the plan was submitted with a lot of variables, but none of those were were really inclusive of center based programs.

They were included in a workgroup a year ago, but much of the discussion has been framework and survey related, not specific to unique needs of centers. The joint labor management, the rate and quality advisory panel did review the JLMC agreement, as Director Johnson mentioned, and there were quite a few concerns that came up in public comment. The determinations related to how wages would be considered. For the first time, the concept of using Bureau of Labor Statistics numbers was introduced.

It's important to note that those are based on current wages and we already know the wages are inadequate. So using that as a baseline, we believe would artificially deflate what is in the base of the program. We also know that the center based programs have factors that are very different than family childcare and completely in partnership with CCPU. We have been discussing it, but there are issues related to facilities, zoning, insurance, facilities, costs, fire clearance that are much different.

And as miss early mentioned, for the contracted center based programs there are additional requirements to meet Title V education standards, which are a different requirement as well. Though I would encourage not to base payment on the color of money from which Department, but on the service being provided. It makes me nervous hearing there might be two different rates. As someone who administers both, I also am very concerned about the timeline.

As Miss Aaron mentioned, we're going to run up against a clock next year and on June 30 of 2025 we will be on the precipice of a cliff if we don't have a plan in place. So we really encourage that there be some discussion this year about what it would look like to ensure that the current dollar investment is protected and that providers don't face that cliff and that we put a safety net of sort in place.

Even if we are successful in getting everything through by June 30, there will be an implementation lag and we can't have a lag in the money that goes along with that. So we'll be eager to work with staff to talk about trailer Bill just as mentioned, and I think it is important that the Legislature have a role in setting clear statutory guidelines around report backs and oversight.

We all need a clear roadmap and we all need to be working from the same set of rules, and I think the more that could be done to set expectations and understanding of those timelines is going to be important. It does need to include interim steps to address any gaps that may happen just because of the time that it takes to make such a huge change in our system.

And it's also important, as mentioned, to, to really look at other policies that need to be adopted, including delinking what the state pays from private pay families and a whole host of payment rules that have just come down from the Federal Government. Lastly, and I'm going to close because I know you've all had a long day, we know this is a very challenging budget environment and that full implementation to do this is going to take quite a long time, many years.

But we are really hoping that you'll work with all of us to ensure that the decisions being made are to create a visionary system that really sets California's childcare industry up for decades to come. It's a lot of work to put one of these together. So let's do it right. And I really hope that we aren't stifled by the current and budget environment to not embrace really long term visionary policies. And I'm happy to answer any questions. Thanks.

Thank you so much, Director. We know. I mean, Jackie, you spoke to it. I think it was you. And doesn't, the statute doesn't necessarily mean that starting July 2025, the rates will go in, but we do know that there could be potentially a cliff. So two fold question here.

One, and maybe this is too early, and maybe this is a question for Department of Finance, but are we thinking that our next for the 2025, we're going to be looking at potentially adding some funding to set the rates to alternative methodology?

I'll start with the response to that. No, I mean, I think we are absolutely committed, as we set forth in our MOUs, in our agreements to date with the Legislature, to look at implementation of what we are going forward with, with this alternative methodology. We're not doing it for the sake of the exercise. We're absolutely committed to utilizing it to inform the ways in which rates are being set. It's the negotiation that's going to dictate our ability to actually figure out the operational plan.

That's why we can't give you a date certain of implementation. Obviously, all of the work that has been laid out by my fellow panelists here is work we have to do over the coming months to get clear on that and have clarity about what 25-26 looks like for rates.

And how do we, and maybe you have a calculator that does this. I guess I don't see that part where if right now each eligible item that can be considered for the final total is just a word and not a dollar value. How do we get to a dollar value at the end?

That is absolutely part of our commitment to work through with the field in our next steps of the work that I'm referencing above. So let me be clear, and I don't think I'd have any disagreement here for the panelists. The work that we've done to date to get to a space where we have that universe to find was significant and quite a bit of robust conversation to get there and completely appreciate more is needed in the center base, and we're committed to doing that.

So that is part of our next steps to get more specific on the values associated with the elements or possible universe of elements for each of the variables. So we're committed to do that in the coming months.

And one of the things I learned about last year is regarding the, apologies if I'm saying this incorrectly, the reimbursements for food is different for centers versus family led.

So this is the Child and Adult Care Food Program maybe you're referencing. This is a federal program, that is.

And they, the family centers pay more. They have to pay out of pocket, or which one pays out of pocket? I forget which one.

There's a reimbursement rate set at the federal level for adults, basically, programs serving adults, programs serving children. It's an optional program for these programs to participate in. We also administer this program. It's federally funded. There's not a, what the reimbursement rate looks like over time. And historically, California has actually created a supplement to that rate, which is just changed over time. That might be what you're referencing, but it is different based on the population being served in the program type.

I guess maybe I didn't need to bring that up to lead into my question, but I'm assuming, I'm pretty sure another twofold. You mentioned you don't want two different rates, Miss Donna, you don't want two different rates. These two centers have different costs associated to them. So how do you anticipate getting around the various different costs with one rate?

I think they have to be tied to the requirements, not necessarily to which agency the funding comes from. So currently at my agency, we run a General childcare contract funded by Department of Social Services alongside a California State preschool contract, which comes from the Department of Education. They have the same title v requirements. So what I was cautioning is we don't want a CDE rate and a cdss rate. What we want is a rate based on the requirements that the programs have to implement.

So obviously, across your system, you have family, friend and neighbor providers, licensed family childcare, private centers, and then centers that are contracted with the state with a higher level of requirements. The current rate system does scale based on those requirements, and we need to make sure that we continue to scale based on requirements. What I am cautioning against is not having it being based on which Department the contract comes from, but on the service being provided.

To the departments is that our intent?

Can I just add something to clarify my remarks from earlier? So it's true, as Miss Sneeringer said, that the state preschool program requirements and CCTR requirements are similar, but they are not identical. So one difference, for example, is that in the California State preschool program, we're working on requiring programs to serve a certain percentage of children with disabilities.

We're phasing that in right now, there's a requirement that 5% of enrollment, of funded enrollment has to be children with disabilities, and that's increasing over time to 10%. So the CCTR program, which in other areas has some, has many similar requirements, does not have that requirement.

Another area of difference is that in last year's budget, there was a directive for the Department of Education to implement the class tool, which is the classroom assessment scoring system, which is a different way of sort of measuring quality in the classroom and looking at teacher child interactions, which has different costs than the tool that had been previously used, which is the Eckers tool, which is early childhood environmental rating system, which is still used in DSS programs but is starting in July, will no longer be used in state preschool.

So I just wanted to clarify that while there are many areas where requirements are similar, they're not identical. And so that's something that, you know, to the extent that different requirements result in different costs, we want in line with the rate and quality work group recommendations, want to make sure that state preschool contractors are paid according to what they're required to do.

I'll just add just to your broader question here. So even the agreement that we've agreed upon with CCPU differentiates what's in the universe of options between a licensed exempt or a family friend and neighbor provider who has different requirements, to miss Naringer's point, than does a licensed family childcare required to title 22 regulations, which also has different requirements than does a title V, one that's working in the title v space. So they do have different standards and requirements depending on the program type.

So that differentiation exists today within our existing rate structure, there's actually a different rate paid by those different standards and program types. That's the consideration that I think we're looking to.

Let me just add something also, which is in the JLMC agreement. Okay. There's the base rate. Right. But then there's also enhancements. And enhancements can be used, I think. I was thinking about NCDE. Right. To differentiate. Right. So we've come up with some agreements regarding enhancements. Right. And there might be further agreements as we go through negotiations. But that's a way of dealing with the differential, some differentials, right. Between different programs to be able to acknowledge them.

If we don't have the infrastructure in place before this June 30, 2025. Is there, is, there? Is there a place, is there not an option? But I don't know what I'm looking for. Is there a possibility for them to fall back to the previous two year agreement rate?

I'm going to restate our intent, which is to utilize the progress we've made, the work we've done to utilize the alternative rate structure in our rate setting process going forward. The operational time period is a consideration that we have to look at. I think the issues related to what we do. If there is a gap, if you will, between.

This is a January question, huh? Just to see as we get closer, to see where we're at more.

It is. That's when we'll have a little more clarity on the timeline.

Is there something we need to do now while we wait for system changes?

We are doing. Yes, just similar to our conversation, our child welfare rates proposal. We absolutely need to look at operational considerations. Now these are the kind of conversations as we're right now. Right. Focused on having the conversation with the non represented workforce on what elements we should be considered, getting our plan together for July submission. But we absolutely need to have conversations related to operational considerations, really understanding the automation changes that will be needed to the extent possible. And then obviously the rates and that.

Automation CDE would also be into the same.

That's right. Well, we have, automation systems are different. So we have automation at the state level. We have automation at the program administrator level.

Okay.

So the actual programs who are administering and actually issuing vouchers to families based on a rate that, those are automation systems as well. So we'll need to be looking at those.

And that is the one you both will be using at the program level? No, at the state level.

So the state, the Department of Education has its system. Department of Social Services has a system That's right. .

You don't have to internally join any system or anything like that.

Right. So currently, as an Administrator who runs multiple different funding streams, we gather all of those different contracts and administer them at the local level and have our own data systems, which we have that are automated to provide services. And I will say part of my reason for bringing up not having different rates is right now in the same facility, side by side, we run Head Start, State Preschool and General Childcare together.

And the more complicated we make it from program to program, the harder it is for us administratively to try to keep it all straight, to be honest. But yes, there will be some time needed for us to change our systems and to adapt. Typically when we've done reimbursement rate changes in the past, we've said we need about 90 days to be able to review. We have to actually manually review every family's file to make a rate change. So I mean, that is part of why I think at least having in our mind a proactive plan of what that interim implementation will look like is really important.

And Jackie, to you, do you see anything that the Legislature can do to help as we prepare for the implementation or infrastructure?

I will flag that in terms of statute where it kind of lays out legislative report backs. The last legislative report back is really tied to that July 1, 2024 date. So I think what you're getting to is, absent any other report backs, when is the earliest we would be notified of any potential changes?

January next year may be a point, but to the extent that collective bargaining is still taking place, there is no guaranteed timeframe for the Legislature to be made aware of any potential infrastructure or operational changes that are needed. I know some comments were made similar to the child welfare rate reform ramp up. I think we're also looking at what are potential implementation activities that the Legislature should be made aware of either in January or earlier to help facilitate that implementation timeline.

And it sounds like, from the panel, it sounds like providers have given some thought on what those elements could be. So we'll be definitely reaching out and getting that detail and reporting back to the Legislature.

Thank you so much. Do you need anything from us, Director in support? I got a long list.

I always appreciate the question, chair. Senator, you know, I think we will absolutely be engaged with you as has been referenced. We have a few significant dates coming up and conversations to be had, and we are absolutely, we will absolutely keep you apprised of our efforts along the way. So appreciate that.

Thank you.

But there are some things that we think need to happen. Yes, we need something from you. Okay. We need to ensure that the issue brings no providers losing funds. Right. And our idea of losing funds means that you adjust for inflation in the CPA. Okay. Because if you don't do that, then our providers will lose funds. Right. They will not be able to meet the needs of the kids that they're serving. We need to be sure that there's funding for the fiscal intermediaries, meaning the agencies that pay to do the payrolling. Right.

That kind of thing, for their technology, so that maybe we don't face the cliff. Right. That they're ready to go. We also need to know what the needs of the Department are regarding staffing wise and financing wise to carry out the jobs that they're all talking about. There's been, as you know, and ...

There's a BCP on that later coming on first.

Okay. That's nice to hear. We need that the contract for P5be continued. It is our understanding that it's up on June 30 of this year. They are the ones that have the expertise to be able to do what I call the mushing. Right. Of all of these factors.

I don't have a legal term of art, sorry, but we need some, they're the ones who have that information and know how to do that to be able to help us fill in the blanks for the chart and then add all of that up that you asked about. At some point it has to be added up. Right. And they're the ones that do that. And so we believe that the Legislature needs to direct the Department to continue that contract for another year.

And the other thing, which is something you kind of alluded to, so this happens everyat least. What we've learned from other states that have done this already, right. Is that this, and the feds require it, that every three years you have to go through this process. Right. And so the question is, do we want to give some instruction right now, right. Maybe in this budget year regarding what the future rules should look like in regards to establishing the new alternative rate. Right.

It's not that we have to come up with a new methodology, but we have to go plugging in the numbers again, have to do a survey, that kind of thing. Thing as we've done this time. And so it might be worthwhile to have some discussion regarding laying out what the rules are for the future because it'll be here before we even know it. The union goes, starts.

We have, as we've mentioned, the reopener, but we also start on contract negotiations for when the 2025, June 30 date. Right. That starts probably in January of 2025. So we need to be prepared to be able to have these kinds of discussions that we hope will lead us right down the road further in order to improve this.

One thing I do want to add very clearly, in terms of your request, much of what we've been able to accomplish, historic and unprecedented investments in this system over the last few years has, in part, been contributions from the Federal Government.

So I just want to make it very clear that while we, we are grateful for this opportunity to have an alternative methodology that the federal rules allow for this, it is also true that we know that the delta between what we pay today and what this is likely to yield in terms of overall cost is in billions of dollars. There have been previous estimates that have been put forward.

So the contributions from the Federal Government to help us realize the vision that we are striving for is something that we should certainly hold hands along the way.

Can I, can I just say one thing? Because I forgot, I just want to say that the one, there was a group that was here today, they had to leave early, the black early childhood education group, and that they wanted to be aligned with our remarks and I think also with Donna's remarks.

Okay.

Thank you.

Thank you so much. Thank you. Holding open. Well, I don't think this was a. Yeah, we're going to hold item number eight open and move on to our last big topic on the proposed methodology for the general childcare slots. I was on it already. Welcome back. Doctor Lupe, Department of Finance, LAO. And then our two panelists are Parent Voices from San Francisco and Early Childhood Education and Nutrition representative. We all here? No, I think we're missing one person. There we go.