Governor Newsom released his 2022-23 proposed budget on January 10, 2022 (https://www.ebudget.ca.gov/budget/2022-23/#/BudgetDetail). This budget proposes an unprecedented $286 billion in spending and enjoys a $31 billion projected surplus. The surplus is so large that Governor Newsom may issue state tax refunds later this year as required by law. A more accurate assessment of the surplus total when the May Revision is released; however, this January budget proposal provides the disability community with an unprecedented opportunity to advocate for funds and how these funds are spent.

The State continues to prioritize the health and safety of all people in California by following a science-based approach to the COVID-19 pandemic. This approach has led to more vaccinations and booster shots, testing, contact tracing, and required masks in indoor locations. The Governor’s Budget includes more than $1 billion to help accelerate vaccine distribution, expand community testing, support hospitals and public health capacity and fund emergency response. People with disabilities continue to be at the highest risk of becoming severely sick and dying from COVID-19 and it is crucial that the disability community continues to be a major part of the recovery discussion.

The Budget proposes to build on investments made to protect the people of California from the damage from wildfires. Four of the state’s twenty largest wildfires occurred in 2021 alone. Supporting the state’s firefighters and ensuring that infrastructure is kept up to date are two ways that the state will protect people in California. The state has expressed a commitment to protecting communities most vulnerable and it is crucial that the disability community is included.

The COVID-19 pandemic has increased many challenges that people have had with mental health and substance abuse disorder. The state has recognized that the pandemic has exacerbated many of the issues that many people already had and has caused workforce shortages and expanded inequities for marginalized communities. Funding for a behavioral health crisis care continuum, solutions for the waitlists for those who are incompetent to stand trial, and mobile crisis services for those who are experiencing mental health crises are all priorities.    

The Budget also proposes tens of billions of dollars in funding to education, housing, and healthcare, with sizable investments across the board, including expanding Medi-Cal to all income eligible Californians regardless of immigration status. Relating to education funding, the addition of Transitional Kindergarten as a new grade level and additional investments in special education, after school programs, and inclusive classroom design are positive steps to correct learning loss during the pandemic. Additional considerations on how schools and special education programs are to be funded with declining enrollment is something the Governor wishes to overhaul, and provides us an opportunity to ensure special education pupils are not left behind.

Relating to the Governor’s homelessness agenda, the proposed Budget significantly invests in stopgap measures to disband homeless encampments and lead individuals to services and temporary shelter. While all types of homelessness funding are critical, we must ensure the final Budget also invests in long-term housing solutions and finds ways to address unsheltered homelessness that doesn’t further curtail civil rights and emphasizes long-term supportive housing and voluntary treatment needs.

While education and human services programs are flush with cash, staffing shortages in all of these fields creates the issue of how to effectively utilize these dollars when the state’s delivery structures are understaffed or less effective during the pandemic. However, the January Budget provides millions in training grants to educators and health care professionals to shore up more talent and to effectively deliver on these ambitions.

Disability Rights California is excited for the opportunities the January Budget proposes, and will expand upon these opportunities during the legislative budget process.

The following are some of the key items in the proposed Budget impacting persons with disabilities and the programs that assist them:

Contents

• Aging
• Children’s Programs
• Department of Developmental Services (DDS)
• Diversity in State Employment
• Early Childhood
• Education
• Emergency Response
• Health and Human Services
• Homelessness and Housing
• In-Home Supportive Services (IHSS)
• Mental Health
• Public Safety
• Supplemental Security Income/State Supplemental Program

Aging

Alzheimer’s

The Budget proposal includes $10 million one-time General Fund for existing Alzheimer’s Healthy Brain Initiative grantees.

Master Plan on Aging

$2.1 million ($1.8 million General Fund) to bolster the Master Plan for Aging’s Data Dashboard to drive outcomes and sustain public engagement.

Health Care Access for Working Disabled

$1.5 million General Fund ongoing to reduce Medi-Cal premiums for working adults with disabilities to continue progress on California’s goals to expand access to health care and increase the affordability of home care.

Inclusive and Equitable Employment

$7.6 million for an expanded California Leads as an Employer initiative to recruit and support a state workforce that reflects all of California, which includes renewed efforts to employ Californians with disabilities.

Protecting and Empowering At-Risk Aging and Disabled Populations

The Budget proposes additional investments to support the growing number of older and disabled adults with more complex needs, across a range of specialized services:

• $10.6 million General Fund annually for three years to continue the Returning Home Well Program to provide transitional housing to parolees at risk of housing insecurity or homelessness. Approximately 25 percent of the parole population is 50 years or older.
• A new position to coordinate best practices with county Public Conservator agencies serving people with probate conservatorships at the California Department of Aging.
• A new position focused on supporting aging individuals with developmental disabilities and their families at the California Department of Developmental Services.

Children’s Programs

Early Start

The Budget includes $849,000 for the California Department of Education and $65.5 million and $82.5 million ongoing for the Department of Developmental Services DDS to bridge the transition from Early Start services to special education services for children at risk for an intellectual or developmental disability.

Department of Developmental Services (DDS)

The Budget builds on historic DDS investments made in the 2021 Budget Act, including an estimated $1.2 billion General Fund by 2025-26 to fully implement service provider rate reform, and prioritizes system stability, workforce development, service access and equity, and outcome-based initiatives that are grounded in person-centered principals. The budget includes $12.4 billion ($7.5 billion General Fund) and estimates approximately 408,000 individuals will receive services by the end of 2022-23.

• Communications Assessments for Individuals who are Deaf - $15 million ($9 million General Fund) one-time funding to support communication assessments that will be used in developing Individual Program Plans to improve services for individuals with intellectual and developmental disabilities who are deaf (Deaf+).
• Work Activity Programs New Service Model - $8.3 million ($5 million General Fund) to establish a service model pilot program focused on expanding employment opportunities for individuals with intellectual and/or developmental disabilities who are currently served through Work Activity Programs or are recent high school graduates.

Probate Conservatorships

• Proposes $1.3 million one-time funding for the Judicial Council to complete a comprehensive study of probate conservatorships and develop recommendations pursuant to Chapter 417, Statutes of 2021 (AB 1194).

Department of State Hospitals (DSH)

The Budget includes $64.6 million General Fund in 2022-23 related to direct response costs to continue responding to and mitigating the impacts of the COVID-19 Pandemic.

Incompetent to Stand Trial

Although this budget proposal and recent prior budget acts make significant investments that will build up behavioral health infrastructure in communities, a current lack of community behavioral health services has led to a rapidly growing number of individuals found IST and referred to DSH. There are currently 1,700 individuals awaiting trial.

This year, the Budget provides $571 million to state hospitals to lower the number of IST individuals by providing additional treatment, beds, and diverting cases to counties. The Budget authorized an additional $175 million to implementing solutions identified by the IST Workgroup.

Diversity in State Employment

In September 2019, the Governor convened task forces to reflect and learn ways to create a more inclusive, respectful, and equitable workplace in state government. Recommendations from the task forces develop a vision of a more inclusive and diverse workforce; with core reforms to how the state recruits, onboards, develops, manages, and retains talent. These include:

• Improvements to the accessibility of the CalCareers online portal.
• Better data collection and analysis.
• Adopting employment goals through a Diversity, Equity, and Inclusion (DEI) business strategy in state departments.
  • Creating a statewide DEI Strategic Plan is the first step towards accomplishing this goal.
• Establish an Equal Employment Opportunity Academy and a Statewide Apprenticeship Program to directly support state employees and departments in improving hiring and human resource practices throughout civil service.

The Budget includes $7.6 million ($6.3 million General Fund) in 2022-23 and $6.8 million ($5.5 million General Fund) ongoing and 43 positions for CalHR to implement these recommendations.

Work Activity Programs: $8.3 million to establish a service model pilot program focused on expanding employment opportunities for individuals with intellectual and/or developmental disabilities who are currently served through Work Activity Programs or are recent high school graduates.

Early Childhood

Universal Preschool

The Budget proposes $110.6 million General Fund to increase State Preschool Program adjustment factors for students with disabilities and dual language learners. These increases are intended to fund new requirements for State Preschool providers to:

1. serve at least 10 percent students with disabilities; and
2. provide additional supportive services for dual language learners.

Early Screening: The budget proposes $2 million one-time to incorporate early identification for learning disabilities into the state’s preschool assessment tools, including a process for follow-up by expert evaluators, and $60 million one-time to provide training for educators.

Former Foster Youth Tax Credit—The Budget proposes a refundable $1,000 tax credit for young adults aged 18 through 25 who were former foster youth at age 13 or older. See the Revenue Estimates Chapter for more details. Foster Youth Independence Pilot Program—The Budget includes $1 million one-time General Fund, available over two years, for county child welfare agencies to provide case management and support services for former foster youth utilizing federal housing choice vouchers in the Foster Youth Independence Pilot Program.

Education

Pre-K

The Governor projects to spend $4 billion to fully implement this new grade, with approximately $1 billion invested in 2022. The Governor wishes to expand transitional kindergarten over the next four years, becoming available to all four-year-old children in 2025-26.

The Budget also proposes $383 million to add one additional certificated or classified staff person to every transitional kindergarten class, reducing student-to-adult ratios.

K-12 Education

In the 2022 budget K-12 schools and community colleges will have $24 billion more to spend next year, $8 billion of which are mandated Prop 98 funds. This brings per pupil spending to an all-time high of $20,855 per pupil.

Despite increased funding, declining enrollment and attendance jeopardizes the funding model for schools. Several schools are expected to close or suffer lower funding unless funding models change. The Budget proposes changes to the average daily attendance (ADA) component of the Local Control Funding Formula (LCFF) to help school districts better manage declining enrollment and simplify the collection of attendance in virtual instructional programs. The Budget amends the LCFF calculation to consider the greater of a school district’s current year, prior year, or the average of three prior years’ ADA at a cost of $1.2 billion.

Early Literacy

The Governor’s budget proposes $500 million over five years for high-needs schools to train and hire literacy coaches and reading specialists and to offer one-on-one and small group help for struggling readers. New one-time grants totaling $200 million would create or expand multilingual school or classroom libraries to support reading instruction.

Afterschool Programs

The Budget proposes $3.4 billion for afterschool and summer school programs which would provide 6 weeks of summer school and before-school and after-school programs for low-income pupils.

Modernizing Schools

The budget proposes $2.3 billion over the next two years, and plans to reserve the remaining $1.4 billion of Proposition 51, a voter-approved school bond initiative.

Special Education

Over the last 3 years, Special Education has received over $3 billion in funding, and this Budget proposes an additional $500 million ongoing to bolster Individualized Education Program (IEP) processes, develop an alternative diploma program, and more.

Another $500 million is proposed one-time for the Inclusive Early Education Expansion Program, which supports inclusive infrastructure to support special education students.

Higher Education

College Affordability: The Budget proposes $750 million to subsidize the cost of student housing, and an additional one-time funding of $515 million to expand middle class scholarships under Cal Grant.

University of California

The Budget proposes an additional $600 million to the University of California, with $295 million one-time in 2022 to further support the Dyslexia Center housed at the UC.

California State University

The Budget proposes an additional $233 million one-time, with $100 million allocated to deferred maintenance projects.

California Community Colleges

The budget provides several funding increases to community colleges including:

• $463 million Cost of Living Adjustment to college staff and faculty.
• $388 million for deferred maintenance projects.
• $200 million for health insurance for part time faculty.
• $150 million for staff recruitment.

Emergency Response

The Budget includes $61.9 million and 83 positions to address the more frequent, complicated and often simultaneous emergencies and disasters involving numerous counties and regions across the state.

• $30 million and 31 positions to establish a Fire Integrated Real-time Intelligence System (FIRIS) program to increase the real-time information and situational awareness available to the state and California’s mutual aid system responders and managers on all hazards, events, including wildfires.
• $11.2 million General Fund in 2022-23, $10.9 million ongoing and 11 positions to enhance the California State Fire and Rescue Mutual Aid System’s fire fleet.

The Budget also contains strategic improvements to emergency preparedness infrastructure, including ongoing support for the earthquake warning system.

• $17.1 million ongoing General Fund to support education and outreach, operations and research and development of the California Earthquake Early Warning program.

Health and Human Services

CalAIM

The Budget includes $1.2 billion ($435.5 million General Fund) in 2021-22, $2.8 billion ($982.6 million General Fund) in 2022-23, $2.4 billion ($876.4 million General Fund) in 2023-24, and $1.6 billion ($500 million General Fund) in 2024-25 for CalAIM.

The following CalAIM initiatives being implemented in 2022-23 include:

• Mandatory enrollment into managed care of beneficiaries eligible for both Medi-Cal and Medicare;
• The requirement that all managed care plans cover long-term care;
• The provision of a targeted set of Medicaid services to eligible justice-involved populations prior to release;
• and the Providing Access and Transforming Health (PATH) initiative to further the successful implementation of CalAIM.

PATH includes the following programs and initiatives:

• Justice-involved start-up funds to build on the successful work conducted under Whole Person Care pilots. This PATH program will build statewide capacity and expand access to necessary pre-release and post-release services under CalAIM.
• Support for implementation of Enhanced Care Management and Community Supports, including Whole Person Care services and transition to managed care; technical assistance; collaborative planning; and capacity and infrastructure transition, expansion, and development funding for providers, community-based organizations, and counties.

COVID-19

The budget continues to reflect significant fiscal impacts related to COVID-19. Based on an assumption of the federal public health emergency (PHE) continuing through June 2022, the budget includes $13.5 billion in total costs ($45 million General Fund costs) in FY 2021-22 and $11.1 billion total funds costs ($2.3 billion General Fund costs) in FY 2022-23. These amounts reflect the net impact of a variety of factors, including:

• Caseload Impact - the Medi-Cal caseload continues to increase because of the COVID-19 pandemic. The budget includes $10.4 billion total funds ($2.9 billion General Fund) in FY 2021-22 and $10 billion total funds ($2.8 billion General Fund) in FY 2022-23 associated with these caseload costs.
• Testing in Schools - To date, schools have relied on direct federal funding to support testing costs rather than billing Medi-Cal for eligible students. As a result, the proposed budget no longer assumes costs related to COVID-19 testing in FY 2021-22; however, $405 million total funds ($102 million General Fund) are included in FY 2022- 23, coinciding with the projected end of direct federal funding.
• Vaccine Administration Costs - The federal government assumed full responsibility to cover vaccine administration costs in Medi-Cal beginning April 1, 2021 as part of ARP. Based on more recent information about vaccination take-up, claiming, and the payment timing, the budget includes $348 million total funds ($38 million General Fund) in FY 2021- 22 and $155 million total funds ($1 million General Fund) in FY 2022-23 to cover vaccine administration costs, not accounting for increased FMAP.

Office of Health Care Affordability

Re-appropriates funding from 2021 to 2022 to address underlying cost drivers and improve the affordability of health coverage (originally $11.2 million in 2020-21 and $24.5 million in 2022-23).

Health For All

The Governor’s budget expands Medi-Cal to all income eligible Californians regardless of immigration status. This proposal is estimated to cover 700,000+ undocumented adults ages 26 through 49, effective no sooner than January 1, 2024, with estimated costs of $819 million total funds ($614 million General Fund) in FY 2023-24 and $2.3 billion total funds ($1.8 billion General Fund) at full implementation.

Medi-Cal

• Medi-Cal Premiums: $53.2 million ($18.9 million General Fund) in 2022-23 and $89 million ($31 million General Fund) annually to reduce premiums to zero for beneficiaries, including pregnant women, children, and disabled working adults, whose income is marginally above the threshold for no cost Medi-Cal.
• Child Health and Disability Program (CHDP): The Department is proposing to sunset CHDP and Expand Children’s Presumptive Eligibility (PE).
• Workforce Development: The budget proposal includes $1.7 billion in Care Economy Workforce investments, including $350 million General Fund to recruit and train 25,000 new community health workers as well as additional health care providers.
• Elimination of Medi-Cal Asset Test (passed in 2021): $200.7 million ($93.4 million General Fund) in 2022-23 to phase in the elimination of the Medi-Cal asset limit no sooner than January 1, 2022 (inclusive of IHSS costs).
• Medi-Cal for Older Adults Regardless of Immigration Status (passed in 2021): $54 million ($43.1 million General Fund) in 2021-22 and $660.9 million ($567.1 million General Fund) in 2022-23 for the full year cost of expanding full-scope Medi-Cal to older adults age 50 and older regardless of immigration status effective May 1, 2022 (inclusive of IHSS costs).

Proposition 56 Supplemental Payment Programs

The budget includes an increase of $29 million from the General Fund to support reduced Proposition 56 revenues (Funds various supplemental payment programs including the Family Planning, Access, Care and Treatment program, women's health services, dental and physician services, developmental and trauma screenings, non-emergency medical transportation, and others).

Other Provider Payment Investments

The Department proposes to make equity and practice transformation payments to qualifying Medi-Cal providers, to close critical health equity gaps; address gaps in preventive, maternity, and behavioral health care measures; and address gaps in care arising out of the COVID-19 Public Health Emergency (PHE). The proposal includes $400 million total funds ($200 million General Fund) in one-time funds, aligning with the goals of the Medi-Cal Comprehensive Quality and Equity Strategy.

The budget proposes to rescind the AB 97 provider rate reductions for eight provider types (nurses, alternative birthing centers, audiologists and hearing aid dispensers, respiratory care providers, select durable medical equipment providers, chronic dialysis clinics, non-emergency medical transportation providers, and emergency medical air transportation providers). The budget includes $20 million total funds ($9 million General Fund) in FY 2022-23 and $24 million total funds ($11 million General Fund) ongoing to eliminate AB 97 payment reductions.

The budget also includes a proposal to reform the framework to move from a primarily cost-based methodology to one that incentivizes value and quality.

Homelessness and Housing

In total, the Budget includes $9 billion for housing resources and $8 billion for homelessness resources in 2022-23.

Project Homekey

The 2021 Budget Act expanded the Homekey effort which provides additional homes and treatment beds when fully implemented. The Budget proposes $5.8 billion for 2022-23 included in the 2021 Budget Act.

Low-Income Housing Tax Credits

$500 million in Low-Income Housing Tax Credits and an additional $500 million one-time to increase affordable housing options and help local governments meet their RHNA goals.

Encampments

The Budget proposes an additional $2 billion over the next two years to expand access to housing for vulnerable populations living in encampments.

• Provides $1.5 billion over two years to purchase and install tiny homes and to provide operational supports in these or existing assisted living settings.
• $500 million one-time to jurisdictions to invest in short- and long-term rehousing strategies for people experiencing homelessness in encampments.

Mobilehome Parks

$100 million one-time for HCD’s Mobilehome Park Rehabilitation and Resident Ownership Program. These funds will finance the preservation and development of affordable mobilehome parks.

In-Home Supportive Services (IHSS)

The budget proposes $24.8 million ($11.2 million General Fund) ongoing to establish a permanent back-up provider system for IHSS recipients.

Mental Health

Adverse Childhood Experiences (ACES) Provider Training

The proposed Budget includes one-time $135.1 million over a three-year period to extend Medi-Cal provider training for ACES screenings.

Crisis Services

• 9-8-8 System: The Budget includes $7.5 million General Fund ($6 million ongoing) for implementation of the crisis service 9-8-8 phone number.
• The American Rescue Plan Act of 2021 authorizes 85 percent federal matching funds for Medicaid mobile crisis response services benefit, available for 12 quarters during a five-year period starting April 1, 2022. Over the five-year period authorized by the Act, total costs of this new benefit are projected to be $1.4 billion ($335 million General Fund)

Medication Assisted Treatment (MAT)

The proposed Budget includes $96 million General Fund in 2022-23 and $61 million ongoing General Fund for the MAT Expansion Project.

Workforce Development

$1.7 billion is proposed to recruit and train 25,000 new community health workers as well as additional psychiatric providers.

Public Safety

California Department of Corrections and Rehabilitation (CDCR)

The Governor's proposed Budget includes total funding of $14.2 billion for CDCR in 2022-23.

Accessibility Improvements

The proposed Budget includes $22.2 million one-time General Fund for accessibility improvements for individuals with disabilities at the California Institution for Men; California Institution for Women; California State Prison, Los Angeles County; and Richard J. Donovan Correctional Facility.

The Budget also includes $2.6 million General Fund in 2022-223 and $2.7 million ongoing for staff to maintain compliance with mandate from the federal class action lawsuit (Armstrong v. Newsom) regarding reasonable accommodations.

Commission on Peace Officer Standards and Training (POST)

The proposed Budget includes $22.7 million General Fund in 2022-23, and $20.6 million ongoing, for POST to support implementation of SB 2, which authorizes POST to suspend, revoke, or cancel any peace officer certification under specific conditions.  An Accountability Division within POST reviews and conducts investigations into incidents of serious misconduct that may provide grounds for suspension or revocation of a peace officer’s certification.

COVID-19 Response

The proposed budget includes $424.7 million one-time General Fund in 2023 to enable CDCR to continue responding to and mitigating the impacts of the COVID-19 pandemic.

Integrated Substance Use Disorder Treatment Program

Proposes to include $126.6 million General Fund in 2022-23, and $162.5 million ongoing, to improve treatment individuals with substance use disorders.

Rehabilitation and Reentry

The proposed Budget includes $10.6 million General Fund annually for three years for the Returning Home Well Program.

The proposed Budget includes $5 million General Fund in 2022-23, and $4.7 million ongoing, to permanently fund Bachelor’s Degree Programs at seven institutions in collaboration with the California State University system.

Juvenile Justice

The Budget includes $100 million one-time General Fund to support improvements to county-operated juvenile facilities to make these locations more conducive to serving justice-involved youth with a wide range of needs, with a focus on supporting trauma-informed care, restorative justice, and rehabilitative programming.

Supplemental Security Income/State Supplemental Program

The administration did not propose an increase in the SSI/SSP grants for 2022-23 budget, citing last year’s agreement to a two-step increase in SSP funding to restore grant cuts made by the state in the 2010 and 2011 budgets. The second set of increases is set to go into effect January 2024. The two-step increase in SSP funding is projected to bring maximum SSI/SSP grant levels to $1,123 per month for individuals and $1,940 per month for couples in 2024 which would fully restore SSP monthly payments to pre-Great recession levels.