State Budget Cuts:

americas kids pay the price 2011 update

October 2011

Introduction
Americans have withstood economic and man-made disasters over the last decade. Two foreign wars. A terrorist attack on U.S. soil. A financial crisis that nearly wiped out the worlds banking system. And, a lingering recession worse than anything since the Great Depression. The state budgets that began shrinking in 2007 signaled the early warning signs of the magnitude of the recessions impact on childrens programs. Since then, state after state has made annual deep budget cuts. Children have paid an enormous price. Many states began their new fiscal years with additional cuts that will make it even more difficult to prepare children for success. This report illustrates the breadth of these cuts. The federal government has failed to soften the damage to children and families caused by state budget woes. Congressional leaders have passed policies that will make things far worse. Early on in this Great Recession, the federal government chose to protect and invest in the children most at risk. In 2009, Congress passed an expansion of the State Childrens Health Insurance Program (SCHIP) to 4 million previously uninsured children, as well as children whose parents had lost their employerbased coverage when they became unemployed. The American Recovery and Reinvestment Act of 2009 provided nearly $150 billion directly to states to keep them from slashing health, education and child safety programs as revenues plummeted. The Recovery Act also provided billions of dollars to programs targeted directly to children Head Start, child care, special education, the Women, Infants, and Children (WIC) nutritional program, and many others. However, all of these program expansions and state aid were slated to end early in 2011. The members of the 112th Congress opposed extending them, despite the lingering impact of the recession.

Many states began their new fiscal years with additional cuts that will make it even more difficult to prepare children for success.

State Budgets Cuts: Americas Kids Pay the Price 2011

The latest Census Bureau data shows:

46.2 million Americans are living in poverty, the largest number of people in poverty in the 52 years in which the Census Bureau has been tracking this data. The number of children in poverty has increased by 900,000 since 2009. 16.4 million children are now living in poverty. 22 percent of children under age 18 are now living in poverty. 25.3 percent of children under age 6 are living in poverty more than one out of every four young children. The poverty rate for children under age 6 is now 25.3 percent more than one out of every four children.

Recession Effects Linger

The recession was officially over more than two years ago, but unemployment remains high, consumer confidence (and spending) remains low, state revenues remain low, and demand for government services particularly for families with children to get by in this economy continue to climb. The majority of states are making deep budget cuts in areas affecting children: public education, health care, child care, and other key areas affecting the well-being of children. On September 13, 2011, the Census Bureau released the latest poverty data reflecting the reality of 2010. For the fourth consecutive year, poverty continued to climb.

As part of the deal to increase the debt ceiling limit, spending cuts are again called for in the 2012 budget to be debated this fall. This will lead to pressure to cut childrens health, education, and safety programs. They will be forced to compete with more powerful interests, with their armies of lobbyists, for limited dollars.

State Budgets Cuts: America's Kids Pay the Price 2011

More than 48.8 million Americans lived in households struggling against hunger in 2010 according to the U.S. Department of Agricultures annual report on food insecurity. 16.2 million children go hungry.

Discouraging Signs from Congress

The early signs for 2012 are not encouraging. In a bill which funds the Department of Agriculture, the House passed a large cut in funds for the Special Supplemental Nutrition Program for Women, Infants, and Children (WIC). The program provides nutritious foods, counseling on healthy eating, and health care referrals to roughly 9 million low-income pregnant and postpartum women, to infants, and to children under age 5 who are at nutritional risk. The House cut of $733 million would force WIC to turn away 300,000 to 450,000 eligible low-income women and young children next year, and would break a 15-year commitment by Administrations and Congresses of both parties to provide enough WIC funding to serve all eligible women, infants, and children who apply. An extensive body of research documents WICs high degree of effectiveness in improving birth outcomes, reducing child anemia, and improving participants nutrition and health. In a bill that funds the Department of Justice, the House Appropriations Committee eliminated funding for Juvenile Justice Demonstration Projects, the Juvenile Accountability Block Grants (JABG), and Title V Local Delinquency Prevention Grants. The cuts will reduce support for local juvenile justice programs. JABG funds are provided to states for programs that provide comprehensive services for youth, renovate facilities, increase court or justice personnel, improve information-sharing, and make other system improvements. Similarly important, Title V grants focus on preventing youth at risk and non-serious offenders from entering the juvenile justice system.
State Budgets Cuts: Americas Kids Pay the Price 2011

We can expect much more when the House Appropriations Committee begins consideration of appropriations for the Departments of Education and Health and Human Services. The debt deal created a Congressional Super Committee charged with finding an additional $1.5 trillion in cuts over the next decade by the end of 2011. These cuts could come from federal funding for Medicaid, which is among the largest expense in many states. Medicaid, the joint federal-state health care program for the poor and disabled, also represents the largest source of federal aid to states. If $1.2 trillion in cuts are not agreed to, an automatic across-the-board cut will be applied for either all $1.2 trillion or the gap between what is approved and $1.2 trillion if the target is missed. Some in Congress say they favor providing support for the truly poor, but say that other families should no longer look to the government for assistance. The cuts passed already, to WIC and other low-income childrens programs, fail the poor and threaten the middle class. Family incomes for those in the middle and lower classes fell during the last decade. As a result, there has been greater demand for public preschool programs, subsidized child care, after-school programs, the Childrens Health Insurance Program and Medicaid, and many other programs that allow families to maintain their standard of living while their income has stagnated or declined. By cutting these programs at the state and federal level, many working families are being driven out of the middle class and into poverty. There is another way. Children should be held harmless. Cuts in childrens services should be rejected and increased instead. We can reject these cuts and tell our leaders to invest in children. Despite claims to the contrary, America remains the wealthiest and strongest nation in the world. Investment money flows into this nation from all over the globe. We can choose to fully fund Head Start, insure the health of every child, provide affordable quality child care to all working families, and reform our public schools. Some in Congress reject this approach and instead want to lower the top tax rate for the wealthy and corporations from 35 percent to 25 percent. Some would eliminate any taxation on inheriting millions of dollars. These choices come at the expense of helping our children.

State Budgets Cuts: America's Kids Pay the Price 2011

The recovery is close to faltering. Another factor likely to weigh on the U.S. recovery is the increasing drag being exerted by the government sector. Notably, state and local governments continue to tighten their belts by cutting spending and employment in the face of ongoing budgetary pressures, while the future course of federal fiscal policies remains quite uncertain . . . In setting tax and spending policies for now and the future, policymakers should consider at least four key objectives. One crucial objective is to achieve long-run fiscal sustainability . . . A second important objective is to avoid fiscal actions that could impede the ongoing economic recovery. Federal Reserve Chairman, Ben Bernake, testifying before Congress, October 4, 2011

We support four simple proposals to help children and families during these challenging times: Promote Tax Fairness. End the practice where Wall Street bond brokers pay a lower tax rate than teachers, policemen, and firemen. No childrens program should be cut until the wealthiest in this nation pay taxes at the same rate as the majority. Close Tax Loopholes. Eliminate tax breaks for oil and gas companies, hedge fund billionaires and corporate jets. Protect Children. Provide $100 billion in aid to states so that they dont have to cut childrens health care, reduce child protection, close schools, fire teachers, crowd classrooms, and eliminate preschool. Invest in Kids Launch a 10-year Invest-in-Kids Agenda that fully funds child abuse prevention and treatment programs, provides Head Start and preschool to all eligible children, provides access to affordable child care for all working families, and guarantees health insurance for every child. The state cuts detailed in the next section and the federal cuts being proposed in Washington were not inevitable or unavoidable. They are not being forced to be cut because of decades of overspending. In many cases, the programs with the greatest growth have grown as a need to compensate for the state of the economy. For example, food stamp spending has increased - a record 45.7 million Americans receive food stamps. But, people receive food stamps due to rising eligibility with families out of work, working reduced hours, or working for reduced pay. Food stamps are meant to ensure that families have enough to eat when times are tough and also to maintain consumer spending in the economy.

State Budgets Cuts: Americas Kids Pay the Price 2011

Making sure children are protected is not a luxury, but rather the responsibility of policymakers who are elected to provide leadership.

Its About Choices

The budget Super Committee will have many choices to make during the next several months. But, they are choices. Congress as a whole will have many difficult decisions to make, but they are choices. Protecting our children needs to be a priority. It is simply unfair to take away from children and give to millionaires. Regardless of political party, it is time to ask Members of Congress what they are going to do to protect children. It is time to ask them to place children first, and then see what resources remain for priorities like tax breaks for the wealthiest in this country. It is easy to be a leader when the economy is growing and families can provide for themselves. It is harder to be a leader when families are struggling to make ends meet and tough choices must be made. It is time to ask policymakers if they will pledge to make the choice to protect children. If they wont, it is time to find some who will. Voting is also a choice. It is time for everyone to choose to vote and to vote in every state and federal election, to volunteer in the community, and to let family, friends and neighbors know what these cuts are and what they will mean for children and families. Please go to www.everychildmatters.org and www.naccrra.org for the latest information. The following pages illustrate the types of budget cuts made this year in states affecting children.

State Budgets Cuts: America's Kids Pay the Price 2011

Appendix: State Budget Cuts Impact on Children

Alabama
X Department of Childrens Affairs, which houses Head Start and pre-k, is facing budget cuts of about $125.5 million (or a 31.52 percent decrease). 1 X The Department of Child Abuse and Neglect Preventions budget was decreased by about $786.3 million (or a 74.25 percent decrease).2 X State budget gap for FY2011: $861 million (12.3 percent of states general budget fund).3

Arizona

X Cancelled child care support for low-income families (denying 13,000 children assistance).4 X Continued freeze on the states primary childrens health insurance program (60,000 eligible children have not received coverage since January 2010).5 X State budget gap for FY2011: $3.3 billion (39 percent of states general budget fund).6

California

X Cut Temporary Assistance for Needy Families (TANF) benefits by 8 percent effective July 1, 2011, reducing benefits for a family of three from $694 to $638. On top of that 8 percent cut, California will impose additional cuts of between 5 and 15 percent for childonly cases those with no adult in the assistance unit that have received assistance for 60 months or longer.7 X Child care and development programs statewide are seeing a decrease of more than $180 million, including nearly $131 million to providers.8 X State budget gap for FY2011: $17.9 billion (20.7 percent of states general budget fund)9

Colorado

X Slashed public school spending by $227.5 million, dropping the average per-pupil funding in the state by $346 to $6,468 in the coming school year.10 X State budget gap for FY2011: $1.8 billion (25.1 percent of states general budget fund).11

Connecticut

X Education cuts were made in the amount of $33.5 million for FY2012 and $38.8 million for FY2013.12 X State budget gap for FY2011: $5.1 billion (28.8 percent of states general budget fund).13

Delaware

X State budget gap for FY2011: $377 million (11.4 percent of the states general fund).14

District of Columbia

X Temporary Assistance for Needy Families (TANF) benefits are cut for approximately 7,000 families, to just $257 a month for a family of three, starting in FY 2013.15 X Although overall education funding rose by 6.6 percent, child care subsidies were cut by $2.2 million from the previous year.16 X State budget gap for FY2011: $279 million (4.5 percent of the states general fund).17

Florida

X Increased the price of tuition at public universities by 15 percent. The tuition increase since 2009 has been 32 percent.18 X Cut $69 million from child care, which will affect nearly 15,000 children.19 X State budget gap for FY2011: $4.7 billion (19.5 percent of the states general fund)20 X Cut 15,000 children from a school readiness program that helps lowincome families obtain quality child care.21

Georgia

X Cut funding for K-12 by $403 million in FY2011 (5.5 percent cut from 2010 budget).22 X FY2012 budget cuts result in 10,000 fewer children receiving child care fee assistance.23 X State budget gap for FY2011: $4.2 billion (25.4 percent of the states general fund).24 X Shortening the statewide pre-K school year from 180 to 160 days, increasing pre-K class sizes from 20 to 22 students per teacher, reducing pre-K teacher salaries by 10 percent, and reducing pre-K provider rates by 6 percent. This is the result of cutting funds for pre-kindergarten by 15 percent.25

Hawaii

X Cut child care funding by 17.9 percent from FY2010 to FY2011.26 X State budget gap for FY2011: $814 million (16.2 percent of the states general fund).27

Idaho

X Closed one-fifth of its field offices (9 of 45) for the Department of Health and Welfare.28 X State budget gap for FY2011: $84 million (3.5 percent of the states general fund).29

Illinois

X $269.4 million was cut from education spending.30 X $15.6 million was cut from early education, $11.3 million for salaries and services of regional offices of education and more than $500,000 that paid for low-income students to enroll in Advanced Placement courses and AP training for teachers.31 X $2.3 million in spending for assessments was eliminated, which will translate into no Illinois high school juniors taking state writing exams next spring.32 X State budget gap for FY2011: $1.35 billion (40.2 percent of states general budget fund).33

Indiana

X Teachers lost collective bargaining rights X Despite modest increases for public schools, a new funding formula was developed that will hurt small school districts in the state.34 X State budget gap for FY2011: $1.3 billion (9.4 percent of states general budget fund).35

Iowa

X State budget gap for FY2011: $1.1 billion (20.3 percent of states general budget fund).36

Kansas

X Base aid per pupil in grades K-12 will drop by $232.37 X Cutting funding for K-12 by $36 million.38 X State budget gap for FY2011: $570 million (10.1 percent of states general budget fund).39

State Budgets Cuts: Americas Kids Pay the Price 2011

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Kentucky

X 4,500 to 6,800 estimated number of Women, Infants and Children (WIC) participants that will be cut from the program.40 X State budget gap for FY2011: $780 million (9.1 percent of states general budget fund).41

Louisiana

X The budget cut $85.5 million from the Department of Children and Families, an agency dedicated to keeping children safe and helping families become self-sufficient.42 X State budget gap for FY2011: $1.1 billion (14.3 percent of states general budget fund).43

Maine

X The budget imposes a five-year, lifetime cap on welfare benefits.44 X State budget gap for FY2011: $940 million (34.7 percent of states general budget fund).45

Maryland

X The budget cuts 43 percent from the Governors Office for Children, slashing funding for prevention, intervention and treatment programs for children and families with intensive needs.46 X Medicaid provider rates will be cut by $264 million, which may cause doctors not to accept Medicaid.47 X State budget gap for FY2011: $2 billion (15.3 percent of states general budget fund).48

Massachusetts

X State budget gap for FY2011: $2.7 billion (8.6 percent of states general budget fund).49

Michigan

X Is cutting K-12 education spending by $470 per student.50 X Michigan also is cutting 124,000 poor children out of a program that helps with the purchase of school clothes.51Reduced by 70 percent the states Earned Income Tax Credit, which helps make work pay for low-income families, immediately ending cash assistance for 13,000 families in poverty, and cutting by one-quarter monthly cash assistance to poor people with disabilities.52 X State budget gap for FY2011: $2 billion (9.3 percent of states general budget fund).53

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State Budgets Cuts: America's Kids Pay the Price 2011

Minnesota

X Child care providers serving families with subsidies will now receive a 2.5 percent cut to their payments. X The Children and Community Services Act grants received a 17 percent cut, which will reduce opportunities to help abused and neglected children. X Cuts are expected to impact 51,000 children in the upcoming year.54

Mississippi

X Failed to meet the states statutory obligation to support K-12 schools, underfunding school districts by 12 percent or $237 million. The states failure to meet that requirement over the past three years has resulted in 2,060 school employee layoffs (704 teachers, 792 teacher assistants, 163 administrators, counselors, and librarians, and 401 bus drivers, custodians, and clerical personnel).55 X State budget gap for FY2011: $716 million (15.9 percent of states general budget fund).56

Missouri

X The $188 million program that provides subsidized child care to low-income parents reallocated roughly $1 million of the $188 million to reduce the benefits for 6,630 of the 45,000 children in the program and to expand services to 570 children whose parents earn slightly more than the income threshold.57 X State budget gap for FY2011: $730 million (9.4 percent of states general budget fund).58

Nebraska

X Early Childhood program was completely defunded, losing $3,365,962.59 X State budget gap for FY2011: $329 million (9.7 percent of states general budget fund).60

Nevada

X Nevada child care subsidies have dropped from $9 million two years ago to $2.9 million today.61 X State budget gap for FY2011: $1.8 million (54.5 percent of states general budget fund).62

State Budgets Cuts: Americas Kids Pay the Price 2011

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New Hampshire

X Reduced funding for child care scholarship assistance that helps working parents afford child care. A waiting list for child care, which had been eliminated earlier this year, will be re-established. As many as 2,200 children will be placed on the waiting list by the end of the fiscal year.63 X Virtual elimination of the Children in Need of Services program, leaving only a small remnant to serve some of the most challenged and challenging children in the state.64 X State budget gap for FY2011: $365 million (27.2 percent of states general budget fund).65

New Jersey

X New Jersey After 3, a nonprofit that operates a network of afterschool programs, would lose an additional $3 million in state funding, after being cut by $7 million last year, effectively ending all state funding for this program.66 X With the loss of FY 2011 federal stimulus funding the Department of Children and Families, which is responsible for safeguarding children in abusive homes and preventing child abuse and neglect, as well as delivering mental health services to children, would see a net reduction of $26.7 million.67 X State budget gap for FY2011: $10.7 million (38.2 percent of states general budget fund).68

New Mexico

X State budget cuts from New Mexicos sliding-fee child care assistance program have placed 5,400 on a wait list with little chance of ever being served. Restrictions to eligibility for the program mean a single parent with one child making just $15,000 a year makes too much money.69 X State budget gap for FY2011: $492 million (9.1 percent of states general budget fund).70

New York

X New York is cutting education aid by $1.3 billion, or 6.1 percent, delaying for the third consecutive year implementation of a court order to provide additional education funding to under-resourced school districts.71 X State budget gap for FY2011: $8.5 billion (15.9 percent of states general budget fund).72

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State Budgets Cuts: America's Kids Pay the Price 2011

North Carolina

X Cut nearly half a billion dollars from annual K-12 education in each of the next two years.73 X Both the state-funded pre-k program for at-risk 4-year-olds and the states early childhood development network that works to improve the quality of early learning and child outcomes will be cut by 20 percent.74 X The biggest potential challenge is that all but 20 percent of students in More at Four will have a co-pay. A low-income family of three people could end up paying 10 percent of its annual income toward the program.75 X State budget gap for FY2012: $2.4 billion (12.1 percent of the states general fund budget).76 X Cut nearly half a billion dollars from annual K-12 education in each of the next two years. X Cut funding to the NCPTA Parental Involvement Initiative.77 X State Budget Gap for FY2011: $5.8 million (30.6 percent of states general budget fund).78

Ohio

X Changed qualifying threshold for child care assistance from 150 percent to 125 percent of the federal poverty level. 79 X Public school funding was cut by about $700 million for the next two years.80 X State budget gap for FY2011: $3 billion (11 percent of states general budget fund).81

Oklahoma

X Department of Human Services budget has been slashed by $32 million, which will mostly result in an increase in co-pay for families receiving DHS subsidies for child care. $15.3 million was taken from Child Care Development Funds, which must now operate on $171 million.82 X State budget gap for FY2011: $725 million (13.7 percent of states general budget fund).83

Oregon

X Cuts to the general fund budget will result in the closure of more than 20 schools.84

State Budgets Cuts: Americas Kids Pay the Price 2011

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Pennsylvania

X Cut about $1.1 billion to public schools and universities reducing money for public schools by roughly 10 percentwith the poorest districts sustaining the biggest blowsand by nearly 20 percent for state-supported universities.85 X After cutting hundreds of millions of dollars out of the budget for the Department of Public Welfare, the administration requested and received the authority to increase co-pays, eliminate eligibility and curtail services.86 X State budget gap for FY2011: $4.1 billion (16.2 percent of states general budget fund).87

Rhode Island

X Reduced Medicaid eligibility for parents from 175 percent of the federal poverty line to 133 percent. For parents with one child to qualify for Medicaid under the proposal, their income would have to be $24,645 or less. Some 6,000 Rhode Islanders would be affected.88 X State budget gap for FY2011: $395 million (13.4 percent of states general budget fund).89

South Carolina

X The state will be spending $1,880 per student for the 2011-2012 school year, $840 less than the $2,720 needed per student (as determined by the states funding formula).90 X State budget gap for FY2011: $1.3 billion (26.1 percent of states general budget fund).91

South Dakota

X State cuts in Medicaid funding of $18.1 million. 24.6 million in federal matching funds were lost, leaving the total loss at $42.7 million.92 X Nearly a fourth of all school districts now have switched to a four day school week.93 X State budget gap for FY2011: $102 million (8.8 percent of states general budget fund).94

Tennessee

X Cut 120 positions, reduce coordinated school health program. Savings: $9.7 million.95 X Closed state-run group homes for juvenile delinquents; eliminate 236 positions department wide. Savings: $12.1 million X State budget gap for FY2011: $1 billion (9.4 percent of states general budget fund).96

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State Budgets Cuts: America's Kids Pay the Price 2011

Texas

X The state legislature completed a two-year budget (FY 2012 and 2013).97 X $1 million in state grants to help school districts offer full-day pre-kindergarten were eliminated. (Half-day is standard.)98 X Public schools will receive about $4 billion less in state aid over the next two years compared with what they would have received under previous funding formulas. This is less of a cut than the $8 billion originally proposed. X State budget gap for FY2011: $8.9 billion (20.9 percent of states general budget fund).99

Utah

X State Budget Gap for FY2011: $700 million (14.7 percent of states general budget fund).100

Vermont

X $3.9 million reduction in changes to the Department of Children and Families.101 X State Budget Gap for FY2011: $338 million (31.3 percent of states general budget fund).102

Virginia

X $700 million in K-12 education cuts for the current biennium include the states share of an array of school district operating and capital expenses, and funding for class-size reduction in kindergarten through third grade.103 X State budget gap for FY2011: $1.3 million (8.5 percent of states general budget fund).104

Washington

X Cut state funding for class size reduction, early learning programs, and teacher professional development by more than $1 billion, an amount equal to $1,100 per student.105 X State budget gap for FY2011: $4.6 billion (29.6 percent of states general budget fund).106

West Virginia

X Cuts to Even Start program $67 million FY2011.107 X State budget gap for FY2011: $134 million (3.6 percent of states general budget fund).108

State Budgets Cuts: Americas Kids Pay the Price 2011

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Wisconsin

X Cuts to child care funding by over $50 million in each year of the biennium.109 X Cutting K-4 programs by $800 million and Head Start by 6.26 million.110 X Cut emergency funding to needy families by $20 an event, and reducing payments to all Child Care Centers.111 X Cut the states Earned Income Tax Credit for 152,000 families with two or more children by 21 percent, which equals an average credit cut of $518 for families with three or more children and $154 for families with two children.112 X The state also is cutting $740 million, or about 8 percent, from K-12 spending designed to equalize funding across school districts.113 X State budget gap for FY2011: $3.5 billion (24.9 percent of states general budget fund).114 X Milwaukee Public Schools, Wisconsins largest school district, will have to eliminate almost 1,000 jobs, closed 12 schools, drop most funding for new textbooks and decrease summer school options.115

Wyoming

X Cut 1,300 slots in Head Start and around 320 jobs.116 X State budget gap for FY2011: $147 million (10.3 percent of states general budget fund).117

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57 http://www.boston.com/news/education/higher/articles/2011/04/21/missouri_senate_passes_23b_state_budget_plan/ http:// www.house.mo.gov/billtracking/bills111/biltxt/truly/HB0011T.htm http://www.house.mo.gov/billtracking/bills101/biltxt/truly/ HB2011T.HTM 58 59 60 61 62 63

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NH Childrens Lobby, Childrens Budget Watch: Whats at Risk in Proposed 2012/2013 Budget?, June 21, 2011, Jack Lightfoot of Child and Family Services NH Childrens Lobby, Childrens Budget Watch: Whats at Risk in Proposed 2012/2013 Budget?, June 21, 2011, Jack Lightfoot of Child and Family Services
64 65

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Endotes
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National Association of Child Care Resource & Referral Agencies 1515 N. Courthouse Road, 11th Floor, Arlington, VA 22201 Phone (703) 341-4100 Fax (703) 341-4101 www.naccrra.org 2011 NACCRRA #1266-1004