New York State Budget Update for Nonprofits

06 Feb 2018

On January 16, 2018, Governor Cuomo presented his 2018/19 Budget Address and discussed the proposed fiscal 2019 budget and its impact on New York State. While his address touched upon various agencies and industries, we’ve outlined below some of his major proposals that have direct impact on nonprofit organizations.

Office of People with Developmental Disabilities (OPWDD)

  • $191 million to support the second year of a multi-year funding request for a living wage for low-wage workers.
  • $80 million to support the minimum wage and related fringe benefit cost increase associated with the transition to a $15 living wage.
  • In accordance with the prior year budget agreement, the Medicaid Trend for not-for-profit OPWDD providers is deferred in order to fund the direct care wage increase associates with increased living wages.
  • $120 million in additional funding available for Program Priorities, including new service opportunities.
  • $15 million in capital funds to develop independent living housing.
  • $39 million to assist in the transition from Medicaid Service Coordination to a comprehensive care coordination model.

Education

Although the Executive Budget recommends $35.7 billion for the State Education Department, including a $769 million increase to school aid, there does not appear to be any increase for 4410 or 853 Special Education providers.

Included in the education proposals are:

  • An additional $15 million investment in pre-kindergarten to expand half-day and full-day pre-kindergarten in high-need school districts.
  • Legislation to ban lunch shaming practices in all schools, including serving an alternative lunch, to students who cannot pay at the point of services.
  • $186 million to reimburse nonpublic schools’ costs for State-mandated activities.
  • $5 million reimbursement program for science, technology, engineering, and math (STEM) instruction. Department of Health (DOH)
  • $142 billion for Medicaid (represents two year appropriation authority), which includes $4.3 billion for the Essential Plan and $7.6 billion for remaining health program spending. This reflects a $5.6 billion increase due to the continuation of two-year appropriations for Medicaid, additional federal Medicaid funding associated with projected programmatic growth, the Affordable Care Act, and minimum wage increases.
  • Early intervention reforms including proposals for increased third-party insurance reimbursement and a streamlined evaluation process for a savings of $3.2 million in 2018/19 and a greater savings in future years. This is concerning to providers as they have not seen any increased funding and cannot sustain further cuts.
  • $425 million in capital investments for healthcare providers to transition into fiscally sustainable systems and to support capital projects, debt retirement, working capital, and other non-capital needs. Of this amount, $60 million is reserved for community-based providers and $45 million is reserved for residential healthcare facilities.

Office of Mental Health (OMH)

  • Effective April 1, 2018, a 3.25% increase will be implemented for 100, 200, and 300-coded employees to support the increase in the living wage.
  • $10 million for existing supported housing and single residence occupancy programs which will help preserve access and maintain current housing capacity as the State brings new housing units online through the Empire State Supported Housing Initiative.
  • $11 million added for community-based programs serving individuals in less restrictive environments. This spending will be offset by spending efficiencies gained in closing excess beds in in-patient programs.
  • $50 million in new local capital spending expansion of crisis respite capacity in the community to avoid unnecessary emergency room visits and inpatient hospitalizations.
  • Elimination of Prescriber Prevails from all medication including mental health.
  • 20 new Assertive Community Treatment teams (10 of which would be in New York City) that would collectively serve 1,280 individuals.
  • $850,000 to establish residential treatment programs within jails to reduce the number of individuals at OMH inpatient psychiatric hospitals.

Office of Alcohol and Substance Abuse Services (OASAS)

  • Over $200 million will be used to address the heroin and opioid crisis. These funds will help support prevention, treatment, and recovery programs.
  • $55 million of capital spending will be used to support the development of new beds, and maintain and renovate the OASAS-funded community-based programs and State-operated facilities, which provide residential, inpatient, outpatient, crisis, and other services to individuals suffering with substance use disorders.

If you have any questions about how these budget developments affect your nonprofit, please reach out to the nonprofit team at Cerini & Associates.