✅ Alliance Support

Click here to read The Alliance’s testimony on the budget.

On May 3, the Connecticut state legislature passed its Fiscal Year 2022/2023 Budget mostly along party lines. The $22 billion budget contains significant increases in funding for community nonprofits.

• Read the FY23 Final Budget
• Read The Alliance’s Press Release

The budget increases funding for contracts with community nonprofits by more than $330 million since FY21and includes tens of millions of state and federal dollars to fund new programs and initiatives. In addition to making appropriations and setting tax policy, the state budget includes hundreds of policy changes in what is known as the “budget implementer.” In some years, the implementer is a separate bill. This year, the entirety of the budget is included in the same bill. Please refer to back to the 2022 Legislative Session Report for an analysis of 50 of the 517 sections of the implementer that will impact nonprofits. What follows is an overview of the policy changes in the budget itself.

The final budget increases funding for community nonprofits by $108.5 million over the budget proposed by Governor Lamont in February. Fiscal Year 2023 will see a total increase in the nonprofit health and human services system of $220.4 million above spending in the current year.

There are also significant investments in the budget for new programs, such as expanding mobile crisis services for adults and children, major investments in early childhood, loan repayment programs for healthcare staff, state payments to essential workers in the private sector that worked through the COVID-19 pandemic, and more.

The budget contains a significant number of new programs and investments. Many of the line items are funded by allocations from the American Rescue Plan Act’s Coronavirus State Fiscal Recovery Fund (the state’s $2.4 billion in direct ARPA funding) as well as other federal funding sources.

Cost of Living Adjustment for Nonprofits

The budget includes an additional $72 million ($52 million from the General Fund and $20 million from ARPA) over the Governor’s Budget to provide a cost of living adjustment (COLA) for nonprofit community providers of health and human services for all state agencies except the Department of Developmental Services (DDS). In total, since the beginning of the biennium, the budget provides a cumulative $110.2 million, or 12%, increase for nonprofit health and human services for all state agencies except the Department of Developmental Services. In addition, the budget annualizes the four percent increase that nonprofits received in FY21.

The $72 million increase represents an increase of approximately 7.5% and will be distributed as an approximately 5.4% COLA on the entire contract with an additional one-time payment from the $20 million in APRA funding, equivalent to approximately 2.1%. Unlike the four percent COLA from FY21, this year’s funding is not restricted to employee salaries.

Final Budget Cost of Living Adjustment

At this time, the COLA does not include Medicaid rates.

Funding for DDS Providers

Since the beginning of the biennium, funding for DDS services has increased by $210.4 million, or 16%. Unlike other provider types, the funding has been provided to settle the terms of the group home strike settlement the administration negotiated in 2021 with SEIU 1199. Because different providers pay different wages and provide different benefits, much of the funding will not be distributed uniformly. These funds will be used so that each provider can meet the terms of the settlement. The budget also creates several new funding sources that will be distributed equitably for providers.

After annualizing the funding increases of $62 million in the current year, the budget retains an additional $91.2 million of enacted appropriations to implement the second year of the agreement, which will raise the minimum wage in DDS-funded programs to $17.25 per hour, provide a second three percent raise to all other staff as of July 1, 2022, and provide a fund now totaling $61.5 million to enhance employee health and retirement benefits.

Final Budget DDS Funding Increase

In addition, the budget adds $20 million in ARPA dollars which will be distributed to DDS providers directly. It also includes $74.9 million in HCBS FMAP increase funding for providers, of which approximately $37.2 million is being distributed to providers without a requirement they deliver new or different services.

The budget also includes:

• $2 million in FY23 from ARPA to provide additional recreational and community engagement opportunities to facilitate socialization and connections for individuals with intellectual and developmental disability (I/DD), a reduction from the $5 million proposed by the Governor.
• $2 million in FY23 from ARPA for infrastructure improvements for public and privately-operated DDS camps serving individuals with I/DD, a reduction from the $5 million proposed by the Governor.
• $2.8 million in FY23 from the General Fund to permanently fund the ICF rate increase to $501 minimum per day. The Governor’s budget proposed shifting the cost of a temporary increase to ARPA, but the Committee proposes to fund it permanently.

Finally, Section 250 of the budget implementer requires that providers receiving HCBS funding be allowed to carry over that funding into the next fiscal year. Section 251 requires that if there is any funding left after DDS providers implement the terms of the union settlement, those excess funds will be disbursed to DDS providers as a cost of living adjustment.

The budget includes significant funding for a variety of new initiatives. While the policy detail for many of these items will not be available until the budget documents are released, and many more have been made that the bill language does not detail, the following proposals are clearly funded in the budget:

Behavioral Health Investments

Children’s Behavioral Health

• The budget provides funding to expand mobile crisis. The Governor proposed a total of $26.4 million between FY23 and FY24 from ARPA to expand mobile crisis. The final budget includes $8.6 million for DCF for expanded 24/7 coverage and linkages with schools and police in each FY23 and FY24. The budget also includes $9 million in FY23 to DMHAS for 24/7 coverage and adding case management post-crisis.
• The budget provides $26 million ($21.5 million from ARPA and a $4.5 million increase from the General Fund) in FY23 to establish children’s behavioral health urgent crisis centers & sub-acute crisis stabilization treatment units.
• The budget provides $5 million in FY23 from ARPA to develop infant and early childhood mental health services by building capacity for specialized mental health.
• The budget provides $15 million in FY23 from ARPA and $5 million in bonding to develop new 12-bed psychiatric/medical unit at Connecticut Children’s Medical Center.
• The budget provides $1 million in FY23 from ARPA for Family Assistance Grants.
• The budget contains $990,000 in FY23 from ARPA to support access to mental health services, $150,000 to support peer-to-peer training for students, and $50,000 for a resource guide, all included in provisions of A. 22-47.
• The budget provides $3.25 million to support Youth Service Bureaus and Juvenile Review Boards.
• The budget providers $250,000 to Child and Family Agency of Southeastern CT to expand mental health services in Pawcatuck.
• The budget establishes a health care provider student loan reimbursement program administered by the Office of Higher Education.
• The budget expands the DPH Student Loan Repayment Program to include more community-based providers and behavioral health clinicians.

Adult Behavioral Health

• The budget provides $12.2 million ($3 million from the General Fund and $9.2 million from ARPA) in FY23 to DMHAS for 24/7 coverage and adding case management post-crisis. The budget also includes $8.6 million in FY23 and FY24 for DCF for expanded 24/7 coverage and linkages with schools and police.
• The budget provides $4.3 million in FY23 from ARPA for additional forensic respite beds for community competency evaluations and restoration to competency activities for repeat offenders of misdemeanor-only crimes.
• The budget provides $2.4 million in FY23 from ARPA for mental health peer supports in hospital emergency departments.
• The budget provides $2.5 million for community placements from Connecticut Valley Hospital and Whiting Forensic Hospital.
• The budget provides $2.25 million to expand supportive housing services to pair with 300 Rental Assistance Program (RAP) certificates.
• The budget provides $1.25 million funded by a carryforward from FY18 to support a gambling prevalence study.
• The budget provides $16 million from ARPA to support a new electronic health record system at DMHAS state-operated facilities.
• The budget provides $4.3 million from ARPA to build additional capacity for community competency evaluations and restoration to competency activities for repeat offenders of misdemeanor-only crimes.
• The budget contains $2.8 million over three years from ARPA to fund the cost of supportive services associated with 150 new housing vouchers.
• The budget provides $1 million from ARPA to support public awareness grants for mental health services.
• The budget establishes a health care provider student loan reimbursement program administered by the Office of Higher Education.
• The budget requires DOC to annually review, evaluate and make recommendations on substance use disorder and mental health services for incarcerated people.
• The budget expands the DPH Student Loan Repayment Program to include more community-based providers and behavioral health clinicians.

Criminal Justice Initiatives

• The budget provides $1 million from ARPA in FY23 to support community- and health-care-based organizations that are preventing and reducing gun violence and to help design and implement anti-violence strategies and reporting of outcomes with the Department of Public Health.
• The budget transfers Project Longevity from the Office of Policy and Management (OPM) to the Judicial Branch. Funding for the program will increase by $2.3 million from the General Fund.
• The budget provides $2.9 million in FY23 from ARPA to provide housing and transitional services for domestic violence victims facing heightened risks during the pandemic.
• The budget provides $2 million to support Youth Service Bureaus and Juvenile Review Boards.
• The budget contains $3.5 million to provide tablets to inmates which have the capacity to send electronic messages.
• The budget provides $600,000 in funding for the Youth Services Prevention account.
• The budget provides $1.25 million for the expansion of the REGIONS program and $750,000 for other juvenile programs.
• The budget provides $500,000 from a carry forward for a study on inmate mental health.
• The budget provides $4.3 million from ARPA to DMHAS to build additional capacity for community competency evaluations and restoration to competency activities for repeat offenders of misdemeanor-only crimes.
• The budget contains $14.9 million from ARPA for Victim Service Providers to offset anticipated reductions in federal funding from the Victims of Crime Act.
• The budget requires DOC to annually review, evaluate and make recommendations on substance use disorder and mental health services for incarcerated people.

Housing Initiatives

• The budget provides $50 million from ARPA to support and invest in the creation of additional affordable housing.
• The budget increases funding by $2 million from the general fund for the Congregate Operating Subsidy Program, reducing reliance on the Housing Repayment and Revolving Loan Fund.
• The budget provides $2.25 million to expand supportive housing services to pair with 300 Rental Assistance Program (RAP) certificates.
• The budget provides $3.4 million from ARPA in each of the next two fiscal years to reduce the backlog of foreclosure/eviction cases.
• The budget provides $2.9 million from ARPA in each of the next two fiscal years to expand bail services to assist people in the criminal justice system to find appropriate housing and residential treatment.
• The budget contains $20 million in bonding to the Department of Housing to develop workforce housing for the healthcare workforce.

Arts and Culture

• The budget provides$15 million in FY23 from ARPA to continue free summer programming such as free admission to museums, aquariums, and other venues.

Workforce

• The budget provides $5.1 million in FY23 from ARPA to expand a DPH student loan repayment program to include behavioral health providers. The current program is funded at $1 million and only covers primary care providers. The budget provides $3 million in ARPA dollars in FY24 and FY25 for this program.
• The budget provides $20 million in FY23 and $15 million in FY24 from ARPA to CT State Colleges & Universities to expand facility, build community pathways and tuition support to address health care shortages and diversify the health care workforce. The Governor proposed a total investment of $55 million over the next three fiscal years, and the budget reduces that request by $20 million to total $35 million.
• The budget establishes a health care provider student loan reimbursement program administered by the Office of Higher Education.
• The budget establishes the Connecticut Premium Pay program, which will provide between $200 and $1,000 depending on their income to health care workers who worked throughout COVID-19 and were eligible for the COVID vaccine during phases 1a or 1b of the vaccination program.
• The budget expands the Essential Workers COVID-19 Assistance Program to cover a broader range of essential workers and makes various changes to how the program’s benefits must be determined and administered.

[1] This represents $15 million to DMHAS providers that was part of each year’s COLA and in FY23, the $20 million additional ARPA funding for Private Providers. There is also an additional $10 million in ARPA for DMHAS provider facility upgrades.