Sep 22, 2011

APD Budget Problems Worse Than Thought

APD Budget Problems Worse Than Thought
The Florida Agency for Persons with Disabilities faces tough choices to balance its budget this year, amid signs that financial problems might be deeper than expected.
Reporter: Jim Saunders, The News Service of Florida

Tallahassee, FL -- September 20, 2011 --

The Florida Agency for Persons with Disabilities faces tough choices to balance its budget this year, amid signs that financial problems might be deeper than expected.

APD Director Mike Hansen told House members Tuesday that the agency spent about $7.6 million more than projected in August. Hansen said he hopes that one month is a "fluke,'' but similar totals in later months would worsen budget problems that already have led to cuts.

"We're trying to figure out what really happened,'' said Hansen, a longtime legislative and gubernatorial budget staffer who took over at APD last month.

What's more, lawmakers set aside money this spring to cover a deficit from the 2010-11 fiscal year. But Hansen said APD does not have as much cash as it expected, leaving it possibly $15 million short of covering that past deficit.

House Health Care Appropriations Chairman Matt Hudson, R-Naples, said the potential $15 million shortfall is troubling "to get hit with at this point.''

APD has run deficits for years in its major program that serves people with disabilities such as autism, cerebral palsy and Down syndrome. Frustrated with the situation, lawmakers this spring made cuts and ordered APD to come up with plans to deal with shortfalls that might develop during the year.

House Health & Human Services Access Chairman Dennis Baxley, R-Ocala, said Tuesday the state needs to get the program under control.

"If we had every agency run amok like this, we would be in chaos and look a lot like Washington,'' Baxley said.

Hansen made back-to-back presentations to the committees chaired by Hudson and Baxley and was candid about the agency's financial problems. He acknowledged that APD might not be able to end the fiscal year next June without a deficit.

"I believe that it's going to be very difficult challenge,'' Hansen said. "We're going to make every effort.''

Also, he acknowledged that a controversial legislative attempt in 2007 to fix the financial problems had not worked. That attempt involved setting up a system of "tiers" that set new spending limits based on the needs of developmentally disabled people.

"We thought the tiers were the right answer,'' Hansen said. "We tried to implement the tiers. But guess what, it didn't work out.''

Lawmakers this spring forced cuts in APD's main program, which serves about 30,000 people and has a waiting list of about 20,000. They earmarked $810 million for the so-called "home and community-based services waiver,'' about $120 million less than the program had been projected to cost.

The Legislature and APD have already whittled down that deficit, with steps such as cutting provider rates by 4 percent and freezing services unless developmentally disabled people are in crisis. Even with such changes, however, APD said in a Sept. 1 report that it needed to find another $55 million in savings.

If the agency goes over spending projections --- as it did in August --- the $55 million total would grow.

Hansen told lawmakers that APD is already moving forward with likely cuts, such as reducing payment rates for some types of services.

Also, it is considering moves such as requiring parents to help pay for services provided to their children. That move, which would use a sliding-fee scale based on income levels, would require federal approval.

Hansen said APD also hopes that longer-term efforts will help stem budget problems, such as a process to review what are known as "cost plans" that deal with the services people receive.

Bigger picture, however, Hansen and Baxley said they think lawmakers and the agency need to look at the program's core mission. Hansen said the state needs to protect people's health and safety, but at least part of the question is what other services it should provide.