News & Events

Budget Update

Thank You Legislators and Governor Newsom for Protecting Developmental Services!

And many, many thanks to all of you! for sending emails, letters, and phone calls!

We know that our state is facing a serious budget shortfall, as a result of the economic impact of the COVID-19 Pandemic upon state revenues. Over $500 million in cuts to our service system had been proposed, to help close this shortfall.

We asked you to contact your legislators by phone, letters and emails, and you, along with individuals, families, and service providers across the state, stepped up! Our legislators heard our community, on the vital importance of protecting services to people with intellectual and developmental disabilities, and told the Governor to refrain from his proposed budget cuts for developmental services.

In their final negotiations, these cuts were removed!

The Governor and the legislators reached an agreement, and the proposed cuts to developmental services were not included in the final budget that was signed this week by Governor Newsom. The budget for Fiscal Year 2020-21 continues to fund current programs, funds growth in caseload and utilization, and provides for a few more service providers to receive needed rate increases.

In view of the current fiscal environment, this is very good news. Thank you all for your support.

Senate Budget Proposal Rejects Proposed Cuts

The Senate’s proposed budget rejects all of the cuts to disability services proposed by Governor Newsom and instead relies more heavily on existing budget reserves to prevent deep cuts. The Senate also proposes to give an 8.2% increase to Early Start Specialized Therapeutic Services, Infant Development Programs and Independent Living services, which were unfairly omitted from last year’s 8.2% increase. The Senate’s version, however, still assumes the state will receive $14 billion from the U.S. Congress, otherwise significant budget pressures will continue to exist....The Senate will now negotiate their proposed budget against Governor Newsom’s budget – which includes much deeper cuts to disability services – and a budget yet to be approved by the State Assembly.

The budget must be finalized and sent to Governor Newsom by the constitutional deadline of June 15, making the next two weeks of advocacy critically important.

Governor Newsom Releases Budget: May 2020

Governor Newsom has released his updated Budget proposal. Called "the May Revise" (because it comes out in May, and revises an earlier proposal), it factors in the major impact of the COVID-19 pandemic on our state's economy. In real terms, this means well over half a billion dollars in money taken away from our service system. Some of this comes from new ideas being cancelled. And a huge part of it is cuts to service providers and regional centers.

The Senate is proposing its own alternate budget that would reject the Governor's Administration's proposed cuts to human services and come up with alternative measures. See our earlier bulletin Prevent Cuts to Our Services.

You can express your views to your California Senators and Assembly Members. Find your representatives and their contact information at

Watch for future updates. The fate of our state budget is going to be contingent upon receiving federal funding.

What Services Are To Be Cut in The Governor's May Budget Proposal?

"Absent additional federal funds, the COVID-19 Recession makes the following REDUCTIONS necessary to balance the state budget. These reductions will be triggered off if the federal government provides sufficient funding to restore them"

  • $230M from the state General Fund (GF) is expected to be saved through rate reductions to developmental service providers.
  • $70M GF is also expected to be saved through "Standardization of targeted services" (e.g., respite), "efficiencies allowing for greater flexibility", and, "exploration of utilization for individuals". The Department of Developmental Services plans to work with regional centers to examine increasing expenditures.
  • $30M GF reduction to Regional Center Operations (eg staff).
  • Increase enrollment in MediCal for children who are eligible due to Institutional Deeming to access federal funding of their services instead of state funding. DDS is proposing that "A parent, guardian, conservator or authorized representative who does not apply for Medi-Cal benefits for each eligible child within the 90 days shall reimburse the Department the federal portion of the cost of any services received by the consumer that would have received Medi-Cal waiver funding."

Proposed Cuts to other community service programs vital to our clients included a 7% cut to IHSS service hours.


"The state is not in a fiscal position to increase rates or expand programs given the drastic budget impacts of the COVID-19 Recession."
· Enhanced Performance Incentive Program—Would have aligned Regional Center performance contracts and require Regional Centers to meet an advanced tier of performance measures and outcomes to be eligible for an incentive payment. This results in a savings of $60 million General Fund in 2020-21, 2021-22 and 2022-23.
· Enhanced Caseload Ratios for Young Children—Would have reduced the regional center services coordinator caseload ratio for children who are three to five years old. This results in a savings of $11.8 million General Fund in 2020-21.
· Systemic, Therapeutic, Assessment, Resources and Treatment Training—Would have provided training and supportive services for individuals with co-occurring developmental disabilities and mental health needs. This results in a savings of $2.6 million General Fund in 2020-21.
· Provider Rate Adjustments—Would have provided supplemental rate increases for Early Start Specialized Therapeutic Services, Infant Development Programs and Independent Living services. This results in a savings of $10.8 million General Fund in 2020-21 and $21.6 million in 2021-22.



· IHSS Service Hours—The May Revision assumes a 7-percent reduction in the number of hours provided to IHSS beneficiaries, effective January 1, 2021. This proposal would result in a cut of $205 million General Fund in 2020-21.
· County and Public Authority Administration—The May Revision freezes IHSS county administration funding at the 2019-20 level. This proposal would result in a cut of $12.2 million General Fund in 2020-21.
Healthcare (Medi-Cal, Dental, Therapies, ICF-DDs)


· Adult Dental and Other Optional Benefits—The May Revision proposes to reduce adult dental benefits to the partial restoration levels of 2014. In addition, the May Revision proposes to eliminate audiology, incontinence creams and washes, speech therapy, optician/optical lab, podiatry, acupuncture, optometry, nurse anesthetists services, occupational and physical therapy, pharmacist services, screening, brief intervention and referral to treatments for opioids and other illicit drugs in Medi-Cal, and diabetes prevention program services, for a total General Fund cut of $54.7 million.
· Proposition 56 Adjustments—Beginning in 2020-21, the May Revision proposes to shift $1.2 billion in Proposition 56 funding from providing supplemental payments for ICF-DDs, physician, dental, family health services, developmental screenings, and non-emergency medical transportation, value-based payments, and loan repayments for physicians and dentists to support growth in the Medi-Cal program compared to 2016 Budget Act.

See full Budget Summary

2019-20 Developmental Services Budget

The Budget Conference Committee and Newsom Administration came to agreement on the final Budget deal for fiscal year 2019/20, which included the following compromise decisions for developmental services:

  • Provider Rates: an additional $125 million will be added in FY 19-20 and $150 million in 20-21 for “broad-based” provider increases that will begin 1/1/20 and sunset 12/31/21. See DDS chart of temporary rate increases. (DDS expects to implement a full rate reform package by December 2021).
    In response to extensive advocacy efforts, some service providers will receive an increase of about 8.2%, while others will receive significantly less, and - we are very disappointed that some service provider categories, such as Infant Development Programs, will not receive any increase at all - on the basis of the recent Burns and Associates rate study.
  • Suspended Services: The committee did not follow the Senate and Assembly Budget Committee's plan, and did not restore social recreation and camp services, nonmedical therapies, and certain educational services that were cut during the recession.
  • “Minimum Wage Quirk”: No action taken to provide rate adjustments to service providers in areas with local minimum wage that is higher than the state minimum wage.
  • Uniform Holiday Schedule: As proposed by the Governor, the Uniform Holiday Schedule, developed as a cost savings during the recession, will be suspended until 1/1/22, but not repealed.
  • Half-Day Billing: This provision from the recession was not repealed.
  • SSI/SSP: There will be no SSP (State Supplemental Payment) Cost of Living Increase

The Legislature previously voted to also approve the following items that had been proposed by the Administration.

  • Early Start Co-Payments: Regional centers will be able to pay for copayments, coinsurance, and deductibles for Early Start children regardless of family income.
  • Crisis Homes For Children: Three community crisis homes for children will be developed, which is a model that thus far has not been available to them.
  • HCBS Final Rule: $3 million was approved for DDS to hire a contractor to visit community settings to determine whether they comply with the HCBS Final Rule integration expectations.
  • Foster Youth Trauma-Informed Systems of Care: Funding for regional center Operations was approved to allow for greater coordination of care for multisystem children.
  • Specialized Caseload Ratios for Regional Centers: Approximately 50 service coordination positions will be created statewide for caseload ratios of 1:25 for those with the most intensive service coordination needs.
  • Family Home Agency Oversight: Funding was approved for regional center Operations to allow for greater monitoring of Family Home Agency services.
  • Specialized Home Monitors: Funding was approved for regional center Operations for nurses and behaviorists to monitor high-level residential facilities.

June 7, 2019
We are in the final week of budget deliberations by the Budget Conference Committee.
Read Gavin Newsome's First Budget Deal is Near. Here's What to Watch For

Read Governor, Help Our Most Vulnerable Citizens, by Assembly Member Chris Holden

"No, there have not been miracle cures for these disabilities. Rather, we have among us miracle workers in the form of local men and women who provide the structure, support, coaching and mentoring that empower the people they serve to achieve lives of meaning and purpose. These miracle workers are employed by local community- based organizations that receive their funding from the state. These groups have transformed California’s system of support for its most vulnerable residents, and we should be proud of this successful public policy. But we cannot feel proud of the way we have let support for these community organizations and the people they employ slip behind in the past 20 years."

Developmental Services Budget decisions that differed between The Senate and the Assembly are now being reviewed by the Budget Conference Committee, to arrive at a compromise for the final budget that will be sent to both houses for approval by June 15th.

  • The Assembly's budget rejected the Governor’s May Revise of targeting specific services for an average 18% increase, and instead use the same total amount of increase proposed in the Governor’s May Revise of approximately $170 Million ($104 Million General Fund - meaning the amount the state must pay which combines with Federal dollars to make the total amount) and make it an across-the-board increase of about 5.7% starting January 1, 2020.
  • This is in contrast to the Senate’s action which approved a motion to include a minimum of an 8% increase to all rates that otherwise would have less than an 8% increase as proposed in the Governor’s May Revise.
  • Click here to see a table summarizing the differences between the Assembly and Senate budget actions.
  • Both houses voted to restore recession era cuts, including restoration of Social Recreation and Camp funding ($14.8M GF), repeal of Half-Day Billing ($1.6 Mil GF) and the Uniform Holiday Schedule ($30.1 Mil GF)
  • Additionally, the Assembly passed $5 Million for safety net services for clients with mental health needs while the Senate did not include it in their budget.

May 23, 2019
This afternoon, the California State Senate unanimously approved SB 412 (Stone), a bill sponsored by ARCA to repeal two fees. Also called "disability taxes," they act as artificial barriers to services for children and families.

Under current law, a program called the “Family Cost Participation Program” requires regional centers to pay for less than a child needs for respite, daycare, and camp (now suspended), based on family income. Families are expected to make up the difference. A separate, income-based fee program called the “Annual Family Program Fee” charges parents of children receiving other services.

The Family Cost Participation Program goes back to 2004. During the Great Recession, it was expanded to include Early Start, and the Annual Family Program Fee was also implemented. They were part of over $1 billion in cuts and funding reductions forced on the developmental disabilities services system. While California’s economy has rebounded, many cuts, including these, remain in place.

Since the fees were created to raise money for the state during the Recession, they are, essentially, taxes on disability. SB 412 by Senator Jeff Stone repeals these disability taxes. By doing so, it removes an artificial barrier to critical services for people with developmental disabilities and their families.

More information about this bill is available online

Thursday, May 16, 2019
In dramatic fashion the State Senate Budget Subcommittee #3 voted to approve an 8% spending increase for services and supports for Californians with intellectual and developmental disabilities (IDD), adopting a request pushed this year by people with disabilities, families, direct support professionals, service providers, and regional centers throughout the state.

In addition to the rate increases, the Committee also voted to adopt several proposals that advocates have highlighted are impacting the IDD community - many of them cuts that were made during the Great Recession. Those adopted proposals include:

  • Restoration of Social Recreation and Camp services;
  • Elimination of the 14 day mandatory holiday schedule, and removal of the sunset language proposed in the Governor’s May Revise
  • Elimination of half-day billing;
  • Correction for the minimum wage “quirk” which currently restricts service providers in ares with minimum wages that are higher than the state minimum wage to receive increases when the state minimum wage goes up;
  • Enable regional centers to make Early Start co-payments on behalf of privately insured families;
  • Require the Department of Developmental Services to submit a place for system-wide rate reform, considering the recommendations of the rate study and impending HCBS final rules, with stakeholder input, by January 01, 2020, with a planned beginning implementation date no later than January 21;
  • Rejection of the Governor’s proposal to sunset the rate increases on December 31, 2021.

The funding increases adopted on May 16th by the Senate represent a first step toward full funding. The State Assembly will next vote on the budget on Tuesday, May 21, and will have the chance to adopt the same budget as the Senate; however, if it is different in any way from the Senate’s version then it will move to the Conference Committee, where a final adopted budget will be negotiated and eventually sent to the Governor prior to the June 15th Constitutional deadline.

Thursday, May 9th, Governor Newsom released his "May Revise" budget, which is updated from his January budget based on actual tax revenue received by the state. The Governor's January budget included no significant increases for services that support Californians with intellectual and developmental disabilities (IDD) (except for increases based on a growing caseload, which only maintains the status quo). The Governor's reasoning for not including increases was that the state's long-awaited rate study, which would bring to light the true investment needed to provide quality services and supports, was going to be released in March, and the Governor was going to wait until after that.

The rate study, which is still in draft form, concluded underfunding of $1.8 billion; however, on Thursday the Governor only proposed to increase services by $165 million next fiscal year and only $330 million the year after that. The Governor also proposed to "sunset" those increases, meaning that they would go away in two years unless re-appropriated. This modest investment doesn't include any guarantee of additional investment over the next couple years to reach the full amount of $1.8 billion. While this budget would undoubtedly benefit a few people, without question the Governor's proposed budget falls far short of what the community hopes and expects from the Legislature and administration this year.

One bright spot in the Governor's budget is the suspension of the 14-day uniform holiday schedule, that was scheduled to begin on July 1. This would have forced individuals and families to go without certain services on 14 days during the year, but the suspension of its enforcement will allow regional centers to individualize the needs for people regardless of holidays. This proposal, however, also would sunset in two years and potentially causing the 14 days to be re-enforced.

2018 - 19 Developmental Services Budget

The legislature has approved the budget and it has been signed by the Governor.

click here to view the Budget Trailer Bill pertaining to developmental services with changes to the Welfare and Institutions Code notated.

Unfortunately, while this final agreement includes some good news, it also contains some disappointments for developmental services.

In January of this year, and then again with his May Revise, the Governor presented his Budget with some additional funding for developmental services to cover the cost of growth in new clients statewide. It did not however include funding for any of the elements for which the developmental disabilities community has been advocating for many months.

During final budget negotiations with the Governor, some enhancements to our system that had been approved by the Senate and Assembly Budget Committees were removed or modified.

  • $25 million in one-time bridge funding for service providers, requested by Assemblymember Chris Holden, was approved. However, this approval is contingent upon obtaining federal matching funds, which can be a lengthy process. This one-year funding is intended to provide some relief for service providers who are struggling due to frozen rates and increasing costs, while the state completes its rate study.
  • Although we advocated for restoration of funding, social recreation and camp services will not be restored (so regional centers are still prohibited from funding these services).
  • The Uniform Holiday Schedule (required unpaid closures for service providers, as recommended in the Governor's Budget but opposed by regional centers and advocates) was approved, but suspended for one year.

Read joint statement from the Lanterman Coalition, "Outrage at State Budget Deal for California's Developmental Disability Community."

Respite Services Update

We want to remind our readers that, as part of the budget trailer bill process this year, the Legislature took action to lift the cap on respite services by repealing Welfare and Institutions Code Section 4686.5, effective January 1, 2018.

  • Prior to January, 2018, regional centers were limited to purchasing no more than 90 hours per quarter of in-home respite and 21 days of out-of-home respite for a family, unless an exemption is granted.
  • Effective January 1, 2018, these limits on the purchase of respite services will no longer apply.
  • HRC has been and will continue to make sure that families, service providers, and local community organizations are aware of the repeal of these restrictions on the purchase of respite, and we will be prepared to authorize respite as needed per each client's IPP..

July 2017 California Budget Update

  • Total expenditures for 2017/18 for developmental services are expected to exceed $7 Billion. The budget projects a total increase of 317,283 new clients to be served statewide.
  • Respite Services: Since budget reductions made during the great recession in 2009, respite services have been capped at 90 hours per quarter. In this budget the cap on respite services will be lifted, beginning January 1st, 2018. Services will continue to be determined according to individual/family need but will no longer have this legislatively established cap at 90 hours per quarter. This is something that our statewide regional center and Lanterman Coalition advocacy teams strongly advocated for in our visits with legislators.
  • Unfortunately the prohibition of funding of social recreation and camp services will continue. We advocated for restoration of these services, but this decision by the budget committee was influenced by the projected costs for restoring these services.
  • Allows Community Placement Plan funds to be used more flexibly as community resource development funds
  • Requires objectives to be included in regional center annual performance contracts that measure progress and report outcomes in implementing the state’s Employment First Policy
  • Authorizes an exemption to be granted for a client’s participation in a paid internship program or competitive integrated employment even though s/he is still eligible for school
  • Authorizes regional centers to provide funding for Early Start services when the service coordination team has determined the needed services are not available through a family's insurance plan

Read More about the Department of Developmental Services Budget for Community Services (Regional Centers) here.

January 2017

Governor Brown released his proposed budget for fiscal year 2017-18. It includes an increase for regional centers Purchase of Services and Operations to accomodate projected growth of 13,836 new clients statewide over the 2016-17 year, for a projected total of 317,283 clients statewide. The proposed total funding of $6.4 Billion statewide therefore reflects a net increase of $359 million from the updated 2016-17 budget. This proposed budget will now be reviewed by legislators who may propose modifications, and may also be amended by the Governor in his annual May Revise, before going for vote for approval in June.

The OPS increase is the net of staffing resulting from increased caseload, adjustments for OPS Projects, and a $2.9 million increase ($1.9 million GF) to fund the two-year statewide minimum wage increase from $10 to $11 per hour for positions below $11. The POS increase reflects increase in all POS budget categories based on updated caseload and expenditure projections.

For the Minimum Wage Increase already in place: $7.5 million increase ($4.4 million GF increase) in POS to reflect increased expenditures based on caseload and utilization growth

For continuation of funds appropriated through ABX2-1 Extraordinary Session in 2016, $14.3 million increase ($8.4 million GF increase) to reflect the full amount of funds appropriated through special session.

Proposed Budget Trailer Bill language includes amendments to:

  • Allow Regional Centers Consumers aged 18-22 who are still receiving educational services to participate in paid internships for the purpose of gaining experience in competitive,integrated employment (through a new internship program implemented for adult clients in 2016)
  • Broadens the use of Community Placement Plan (CPP) funds to include additional community resources to develop services and supports for consumers already living in the community, including those with specialized and complex service needs.

July 2016

The Legislature passed a budget for the 2016-17 fiscal year which contains a substantial increase in spending for regional centers mostly because it incorporates the provisions of ABX-2 passed by the Legislature during the special legislative session. There have been no unexpected additions or deletions in the budget as enacted. The new fiscal year, and the new budget, were effective on July 1, 2016.

Budget Highlights

March 2016

Reason To Celebrate: Bipartisan Legislature Passes Developmental Services Funding Bill

On February 29, 2016, the Legislature passed a two-bill package, signed by the Governor on the following day, that will provide much needed funding relief for services for people with developmental disabilities and the people who serve and care for them. These votes come after a five-year campaign by our community.
The first of the two bills helped to secure continued inflow of federal funding, by restructuring the way that Managed Care Organizations are taxed. The continuation of federal funding made it possible for the second of these two bills to provide nearly $300 Million in state general funds for the developmental services system. And this will be matched by federal funds resulting in an estimated total of more than $400 Million. Support for the developmental services funding bill in the legislature was unanimous.

After over a decade of service cuts, funding reductions and frozen rates, the new funding has been targeted to specific areas, to begin to restore the service system. These include funds to retain service coordinators and service provider direct care staff, and rate increases for targeted service categories such as supported employment, supported and independent living, respite, and transportation services. Special initiatives for promoting integrated employment, and increasing cultural competency in service delivery were also included in the funding package. Finally, the package will fund a rate study plan to support the ongoing sustainability of our service system.
The new infusion of funds is to become effective July 1st of 2016. We expect that some fine tuning will occur during the coming months as the total budget for the 2016-17 fiscal year is finalized, and as implementation details are provided by the Department of Developmental Services.

What’s Next?

Many in the developmental services community, including system advocate Senator Jim Beall, have pointed to the severe need for housing resources for people with developmental disabilities. We are also continuing to advocate for resource development for all types of services, to begin to restore services which have been lost as underfunded programs have been forced to close, and to serve emerging needs in our community.
For now, the passage of new funding is an important first step in our ongoing efforts for the fundamental reform we will need, to see another 50 years of developmental services.

Read California Legislature approves bills on taxing health plans

Read Daily Breeze: Californians with Developmental Disabilities Get Desperately Needed Help

Read HRC ENews 2/12/16 for background What is the MCO Tax and Why Is It Important to Developmental Services?

The approved MCO tax and developmental services funding package includes:

  • A 7.5% increase for salaries and benefits,for both POS&OPS
  • A 2.5% increase for administrative and other costs,for both POS&OPS
  • A restoration of the supported employment rates to 2006 levels
  • A 5% increase for supported and independent living services
  • A 5% increase for in-home and out-of-home respite services
  • A 5% increase for transportation services
  • An effective 5% increase for ICFs,done as a 3.75%increase,and the elimination of prior cuts,
  • A comprehensive increase for competitive integrated employment programs, in the form of paid internships and incentive payments for helping individuals obtain and retain employment
  • An increase in vendor audit thresholds
  • A rate study plan
  • 5 million for disparity issues for bilingual staff at regional centers, cultural competency training,and parent education efforts

The Administration has put the total value of this package at $300M General Fund, $418M Total Funds. The majority of that money will be provided via the MCO agreement, with the balance addressed in the Governor’s May Revise.

Thank You HRC Community for Contacting Your Legislators

"The real power behind this was the tireless work of advocates like you. This is an historic step for over 300,000 Californians with developmental disabilities, their families, and their service providers." said Anne Struthers, President of ARCA. "This bipartisan support shows the Legislature and Governor Brown are committed to community-based care and the values expressed in the Lanterman Act, passed also with bipartisan support in 1969. Congratulations to the Legislature for taking this step." \
Association of Regional Center Agencies

Read More

Thank you Legislators For Your Support!

"Today, after a decade of waiting, the developmental disability community in California finally got some help from Sacramento! I was proud to support this measure... This is a down payment on restoring years of cuts and cost-of-living adjustments that were never appropriated."
Assembly Member David Hadley, Torrance

"The Legislature approves ABX2-1, injecting $500 million in permanent, on-going funding -- $300 million in state funding that draws a $200 million federal match-- into the beleaguered developmental disabilities services network. It's a good first step to stabilize the system, but we still must come up with a long term solution." Senator Jim Beall

Thank you to HRC area legislators:
Senators Ben Allen, Isadore Hall, Ricardo Lara, and Tony Mendoza
Assembly Members Ian Calderon, Cristina Garcia, Mike Gipson, David Hadley, Patrick O'Donnell, and Anthony Rendon.

The Governor's Budget for 2016-17

Developmental Services (DDS) Budget Highlights
The proposed budget provides additional funding for regional center operations, to. add more service coordinator positions, for example. But the budgeted amounts are not enough to keep up with growth and current costs. Funds are provided for mandated increases in minimum wage, but not for rate increases which have been long frozen.

Governor’s proposed budget leaves healthcare, special needs advocates disappointed

"The recession-era cuts left a $1.1 billion hole in the state’s Department of Health and Human Services, which won’t be restored by the budget proposal, even as the Golden State has built a surplus. Those cuts continue to be present in Brown’s latest budget proposal because they go unrestored, said Anthony Wright, executive director of Health Access California.
Instead, Brown is counting on lawmakers to continue a special session he convened last year so that they could discuss and come to a consensus on a revised managed care organization tax to restore the $1.1 billion. "

Legislative Analyst's Office Budget Overview 2016-17

Developmental Services

We note that the Governor’s proposal does not appear to provide adequate funding to bring RCs into full compliance with these ratios, and to the extent that RCs are out of compliance with federal caseload ratios, some federal funding could be at risk.

The 2016–17 budget provides for several new spending proposals in the DDS. These major budget proposals are primarily to support community services and their development, as described below. The budget also includes a proposal for additional headquarters staff resources to improve DDS’ fiscal oversight of services provided to persons with developmental disabilities.
Budget Assumes a New Rate for Certain Residential Facilities. The Governor’s budget proposes $46 million ($26 million General Fund) to allow for the development and implementation of a new rate for certain residential facilities serving four or fewer individuals. These facilities are currently funded through a rate methodology—known as the Alternative Residential Model (ARM) rate—which has not been updated in many years. This rate methodology was established based on the assumption that each home would support six residents. Therefore, the current individual rate–per–consumer paid to facilities assumes that overhead and staffing costs is spread across six placements, even though Regional Centers (RCs) are increasingly using facilities with fewer placements, which is generally consistent with federal policy direction. The new rate would be based on a four–bed model. Because many individuals residing in DDS–funded residential homes are in ARM–rate facilities, we think the Governor’s proposal merits consideration. However, the Governor’s budget does not include any other proposed rate adjustments or reforms for any other community service provider rates, which continue to be of significant interest to the Legislature and part of ongoing stakeholder and legislative discussions.
Funding to Begin Compliance Efforts With New Federal Regulations. The Governor’s budget provides $17.1 million ($12.2 million General Fund) to support compliance by March 2019 with new federal requirements related to Medicaid–funded community–based services. California receives about $1.7 billion in federal funds annually for these services in the DDS budget. The new federal rules require that services are provided in settings that are integrated with the larger community. The proposed funding would support 21 Program Evaluator positions within the RCs to evaluate and monitor compliance and would provide resources to providers for service modifications and staffing needs to meet compliance. Noncompliance with these regulations could put federal funding at risk. While the Governor’s proposal shows the administration’s commitment to bringing California into compliance, it is unclear how this proposal would be implemented and the extent to which the funding levels provided for service changes move the state toward full compliance with the federal regulations.
Additional Service Development Funds Support Developmental Center Closures. In May 2015, the administration announced plans to initiate closure of the state’s remaining developmental centers, with some exceptions. The 2015–16 spending plan reflects the Legislature’s approval of the Governor’s intent in concept. On October 1, 2015, DDS submitted to the Legislature a plan to close Sonoma Developmental Center and in November 2015 announced intent to submit similar closure plans for Fairview Developmental Center and the general treatment area at Porterville Developmental Center. The Governor’s budget includes $78.8 million ($73.9 million General Fund) in one–time resources for service development targeted for individuals transitioning from these centers. The state is at risk of losing additional federal funding related to these developmental centers due to violations generally related to clients’ health, safety, and rights. The state was able to reach a settlement agreement with the federal government that would continue funding if certain terms are met, which include a commitment to transition individuals out of Sonoma Developmental Center. The state is in similar negotiations related to the other developmental centers proposed for closure.
Budget Includes Funds to Support Improvements in RC Caseload Ratios. Current reports to DDS indicate that all RCs were out of compliance with one or more caseload–ratio requirements for the past two years. The Governor’s budget includes $17 million ($13 million General Fund) to support an estimated 200 additional RC service coordinator positions. Caseload reports show RCs have had a longstanding noncompliance in meeting caseload–ratio requirements. We note that the Governor’s proposal does not appear to provide adequate funding to bring RCs into full compliance with these ratios, and to the extent that RCs are out of compliance with federal caseload ratios, some federal funding could be at risk.

News on Special Session


The Brown Administration is currently developing the Governor's Budget for fiscal year 2016-17 to be released in January. At a meeting of the Developmental Services task force, Secretary of Health and Human Services Diana Dooley warned that because the Managed Care Organization tax proposal to fund MediCal and developmental services did not receive sufficient bipartisan support in the extraordinary legislative session, the Governor's Budget will not contain any increases, and may even contain decreases for health care and developmental services. "Without additional revenue, there will be no alternative to reductions in our health care spending." Statement of California Health and Human Services Secretary Diana S. Dooley on the Managed Care Organization (MCO) tax.


Although clients, families, service providers and advocates across the state worked hard to encourage the passage of SBX2-14 on the final scheduled day of the Special Session, the legislators were not able to reach agreement on this bill. However, they created a conference committee with members from both the Assembly and Senate, from both parties to continue work on this issue.

No help yet for developmental community; special session’s work must continue

Read More

Industry, governor fail to reach deal on new health tax

Read More


Sacramento Bee Editorial Board: Enough speechifying, boost pay for care of disabled people

Read More

LA Daily News: Advocates for those with special needs await cigarette tax vote as session closes.

Read More

9/9/15 Senator Hernandez Introduces Comprehensive Bill to Fund MediCal and Developmentally Disabled Programs

Read More

7/9/15: Senators Jim Beall, Bill Monning, and Fran Pavley have introduced a bill, SBx2,

to provide a 10% across the board funding increase, require the state to develop a ten-year financial sustainability plan to support this system, and cover service providers' costs for minimum wage increases. Read More

6/17/15 - Legislators respond to developmental disability community outcry: "Our commitment has not changed, only the venue.”

Statement from Legislative Leaders on Department of Developmental Services Funding

6/16/15 - Budget Deal Announced by Goveror Brown, Senator DeLeon, and Assembly Member Atkins

Although the Budget passed by the Legislature on Monday 6/15/15 included nominal funding increases for developmental services, these were removed from the final agreement with Governor Brown.

That means that although the budget will include just enough funding increase to cover the anticipated growth in new regional center clients. The hoped-for and fought-for rate increases for service providers and regional centers did not make it through to the final budget agreement.

The Governor did address the need to provide additional support for our system, in a press release announcing that he is calling for a special session of the legislature to address funding for a variety of programs. In his press release he stated: “In the special session, the Governor proposes that the Legislature enact permanent and sustainable funding to provide... funding for additional rate increases for providers of Medi-Cal and developmental disability services.

..."Whereas the state's General Fund cannot afford to provide additional rate increases for providers of service for MediCal recipients and consumers with developmental disabilities..." Read Proclamation.

We will of course continue our efforts to advocate for increased support to strengthen our service system and will watch closely for any new developments in the days to come, the legislature's special sessions and continued efforts by the Developmental Services task force for system reform. The Association of Regional Center Agencies (ARCA) and the Lanterman Coalition are continuing their Virtual Candlelight Vigil, “Let Your Light Shine for Lanterman.

6/10/15 - Budget Conference Committee Reaches Agreement on Health and Human Services funding. (Unfortunately, None of the increases in the Budget Conference Committee's plan survived the final agreement with the Governor).
The Conference Committee is made up of top legislators, who work out the different proposals that have been made between the Senate and Assembly's Budgets. Each Committee member demonstrated that they heard your voices, and know that developmental services needs and deserves support.Watch video of their June 1st session (video begins at approximately 00:10:00; discussion of regional center rates begins at 00:26). Late Tuesday, June 9, 2015, the Budget Conference Committee approved some funding increases and restorations for health and human services programs, The Governor’s representative from the Department of Finance, expressed concern about the long-term ability of the state to afford such funding levels, and opposed almost all the increases in funding that the Budget Conference Committee approved.

What the Conference Committee approved (but was later thrown out during final negotiations with Governor)
· 5% increase for Supported Living, Supported Employment, and Respite.
· 2.5% increase for transportation.
· Funding for 21 dental coordinators and 21 forensic specialists (one per regional center)
· 5% increase for Client’s Rights Advocates (Disability Rights California)
· 2.5% increase across-the-board for services whose funds were not previously increased
· 2.5% increase to the core staffing formula
The Committee also approved Trailer bill language requiring the Department of Developmental Services to annually report on progress related to rate reform, and language expressing legislative intent to calculate savings from the closure of developmental centers and reinvest it in the community.

What Was Proposed in the Governor's Budget for 2015-16?

The Governor’s Budget for 2015-16, released in January, and his recently released “May Revision” proposed no increases or adjustments for regional centers or service provider rates, despite significant evidence and input that after many years of rate reductions and freezes, the developmental services system is experiencing severe strain upon its ability to serve our community. Last year the Governor directed the Health and Human Services Agency to convene a work group to review these issues. In the past year this Developmental Services Work Group has been meeting to analyze issues, but no recommendations have emerged as yet. At legislative hearings in the Senate and Assembly, budget subcommittees discussed at length the lack of significant funding adjustments for regional centers and community-based service providers in the past decade, and have listened closely to extensive public comments. Many have expressed deep concerns about the impact of a prolonged rate freeze, and an outdated, inadequate funding formula upon the quality, stability, and accessibility of services and supports in the community. 67 Legislators (a majority in both the Senate and the Assembly) have signed a letter supporting increased funding to support developmental services. Legislators have also expressed interest in using savings achieved from the closure of developmental centers for new investments in regional center services for people with developmental disabilities in the community.

Budget Recap 2014-15
The 2014-15 Budget included $5.2 billion ($2.9 billion General Fund) for support of all developmental services including the regional centers. "Trailer Bill Language" was also enacted to implement the following:

  • The budget will cover an anticipated increase of 9,480 regional center clients, and $125.6 million increase over 2013-2014 fiscal year for caseload growth and service utilization.
  • Early Start eligibility restored to pre-2009 levels:
    Currently, developmentally delayed infants and toddlers who are determined to have a significant difference between the expected level of development for their age and their current level of functioning are eligible for early intervention services.
    Beginning January 1st, 2015, infants and toddlers who are at high risk of having substantial developmental disability, due to a combination of biomedical risk factors, will also be eligible.
    Eligibility is determined in either case by a multidisciplinary team of qualified professionals and the parents.A "significant difference will be defined as a 33 % delay in one or more developmental areas.
  • Payment for Health Care Service Plan or Health Insurance Policy Deductibles: Similar to the implementation of payments for health insurance copayments and coinsurance (which became effective in 2013), regional centers were authorized in 2014 to pay for applicable insurance deductibles for services that are paid for by a client's health plan, if the client meets specified conditions (eg. income less than 400% of federal poverty leve).
  • Rate Adjustments Due to the Minimum Wage Increase and Changes in Federal Regulations Implementing the Fair Labor Standards Act of 1938. The rate adjustments shall be specific to payroll costs associated with any increase necessary to come into compliance with the increased state minimum wage, but not for general wage enhancement for employees already paid above the increased minimum.
    Click here for more information on implementation of funding for the minimum wage increase.
  • $7.8 million increase to fund the changes in the Fair Labor Standards Act regulations, for payment of overtime for in-home workers by service providers that previously were not required to pay overtime.
  • Provisions for development of community resources, including two new models of care for enhanced behavioral supports homes and community crisis homes.
  • The Director of Health and Human Services has been directed by the Governor to convene a task force to review issues related to adequate funding of community services (regional centers and service providers), and to continue to work on issues identified in the Plan for the Future of Developmental Centers.

for current and prior years on the DDS website:


The 2013-14 budget reflected the state’s gradual economic and budget recovery process, and it maintained the Governor’s proposals for cautiously controlled spending, to avoid a deficit.

Regional Centers’ budget for 2013-14 saw an overall increase to Purchase of Service funding of about $150 million over 2012-13, primarily to provide for projected growth by 8,637 total clients. The best news to come for regional centers and our providers in this budget was the discontinuation of mandated payment reductions for service providers.

For medically necessary treatments that are covered by clients/families’ health care plans (such as behavioral health services) lawmakers added directives for how regional centers may provide services . The new language in the law prescribed the limited conditions under which regional centers’ may cover insurance co-payments (e.g. based on the family’s income of 400% or less of federal poverty level), and prohibited payment of deductibles.

Another provision of the budget trailer bill made the Annual Family Program Fee continue indefinitely, for families of minor children who are served by regional centers, receive certain purchased services, and who have income at or above 400% of federal poverty level. Regional Centers advocated the ‘sunset’ of this fee in June of this year as originally planned, but it has been made permanent.

Some of the funding restoration hoped for by advocates for people with developmental disabilities did not make it into the final budget deal. Our system came together in force, statewide, to advocate for restoration of eligibility for Early Start services to what was in place prior to 2009. However, the changes in eligibility for Early Start services that went into effect in 2009 remained in place for 2013-14, and there was no funding for regional centers to provide prevention services for infants and toddlers at risk of developmental disabilities. (Regional Centers continue to serve infants and toddlers birth to 3 years with more significant developmental delays, or established risk conditions with a high probability of resulting in delay).


In June 2012, both the Senate and Assembly approved the Department of Developmental Services (DDS) plans for reducing developmental services by $200 million in 2012-13. The budget was passed by the legislature, and signed by the Governor.

In November 2012, voters passed Proposition 30. As a result, California Regional Centers will not be required to implement an additional $50 million reduction for the second half of 2012-13. This reduction would have been part of a larger $6 billion total statewide reduction for a variety of services and programs in California, and would have amounted to a total $100 million additional reduction for regional centers in the full fiscal year 2013-14.

Regional Centers continued to implement changes which had already been required, associated with the reduction of $200 million to the state’s annual developmental services budget, under the state Budget Act passed in June of 2012.

"The Budget reflects $200 million in 2012-13 savings. Savings will be achieved by increasing eligibility for federal funding, increasing insurance billing for certain autism-related services, redesigning options for consumers who have been hard to serve in the community, and a 1.25% provider payment reduction."

As reported above by the Department of Finance, one component of the $200 million reduction to developmental services in the 2012-13 fiscal year is the payment reduction of 1.25% for service providers (purchase of service) and for regional center operations. This represents a partial restoration of payments, compared to the reduction of 4.25% which had been in effect since 2010.

These changes include:

  • a payment reduction for regional centers and service providers of 1.25% (as noted above, expected to end June 30, 2013)
  • assisting families to access private insurance coverage for behavioral health treatment and other medically necessary services instead of paying directly for these service using regional center funds
  • a standardized process for reviewing needed supported living services
  • strict limitations on admissions to the developmental centers for individuals with exceptionally challenging service needs.
  • In addition we continue to implement measures instituted in earlier years, such as continued assessment of annual family program fees, and development of transportation service plans designed to eliminate contract transportation for individual clients.

Despite these measures, regional centers are concerned that their concerted efforts will not be able to achieve the full $200million in savings, and with the possibility of ending the year in deficit. Together the regional centers are continuing to ensure that individual needs identified in individual/family service plans are met, while working closely together with the Department of Developmental Services to get through this year within funds available.

2011-12 Recap
Some of the most significant changes made in 2011-12 include, but are not limited to:

  • Continuation of temporary 4.25% payment reduction to regional center operations and service providers (purchase of services), and administrative reductions to regional centers and DDS (changed to 1.25% for 2012-13)
  • A new Annual Family Program Fee of $150-$200 for families of minor children who live at home, and have income of at least 400% or more of the federal poverty level. Some families will be exempt, eg. if the child receives Medi-Cal or does not receive services beyond eligibility determination, needs assessment and service coordination. (Continuing)
  • Elimination of the regional center Prevention Program. Effective July 1st, 2012, infants ‘at-risk’ of developmental disability will be referred to Family Resource Centers for information and referral, while regional centers will continue to provide services to infants and toddlers with developmental delays who meet Early Start criteria. (Continuing)
  • A new requirement for families to provide the regional center with a copy of any health benefit card at the time of assessment or at the individual service planning meeting, to promote access of any available benefits. (Continuing)
  • A requirement to access education-funded day services, rather than regional center-funded programs, for 18-22 year old adults.(Continuing)
  • Requirements for adult day services to offer flexible or half-day schedules. (Continuing)
  • Allowing lower payment levels for individual clients in licensed homes whose needs have decreased, without having to move to another home. (Continuing)
  • Providing shared supported living services for adults with shared tasks in the same supported living home, Conducting independent assessment of support needs. (Beginning in 2012-13 a new system is to be implemented for standardized assessment of all clients receiving supported living services, rather than independent assessment of only those clients receiving higher cost SLS services).
  • A new requirement for parents receiving behavior services to verify receipt of those services prior to payment. (Continuing)