FY 14 Block Grant Planning

1. John R. Kasich, Governor Tracy J. Plouck, Director, ODMH Orman Hall, Director, ODADAS FY 14 Block Grant Planning (Future) Department of Mental Health & Addiction Services May 9, 2013

2. Agenda • Objectives for FY 14 plan • Brief review of FY 13 circumstances: • SAPT • MH • Sequester • Discuss philosophy • Review, discuss scenario options • Logistical/fiscal items • Identify next steps

3. Objectives • Where appropriate, adopt a consistent philosophy and process for both block grants • Review with community partners: • The cash challenges of the SAPT Block Grant • SFY13 SAPT sequestration impact • Funding Scenarios: “What if sequester continues?”

4. FY 13 Circumstances - SAPT • $62.7MM • Basic requirements: • 20% prevention • $10.9MM womens’ (MOE requirement) • Cash availability has been a challenge in recent periods

5. FY 13 Circumstances - SAPT • Historically, ODADAS has used SAPT resources in concert with GRF and rotary funds (i.e., Fund 4750) • Reductions to any one of these sources result in a need to refine all three types of community allocations in order to maintain parity approach among grantees • We will be adjusting the budget planning process to reach a solution for predictability

6. FY 13 Circumstances – MH BG • $15MM (includes carryover) • Approx. half disbursed by formula (qtrly) • Grants designated by Department priority area (w. Planning Council input)

7. FY 13 Circumstances – MH BG • MH block grant “base” allocations ($7.5MM) to boards are formula based and separate from other subsidy allocations, i.e., different approach than SAPT • Projects are granted through Notice of Award • Some are competitive; others non-competitive • Priority areas determined by SAMHSA, Planning Council and Director

8. FY 13 Circumstances - Sequestration • Communication to field 3/25 regarding reductions to major federal grants:

9. FY 13 Circumstances - Sequestration • FY 13: No reduction impacts to the field during SFY13 as a result of the following; • Utilized AoD state resources to realign originally awarded SAPT dollars • Cancelled unobligated balances and projects that have not yet begun (MH & AoD) • FY 14 plan: determine approach in concert with community partners • Application of SAPT13 sequestration reduction over SFY14/15 biennium (8 qtrs)

10. Philosophy • Promote transparent planning & monitoring • Apply outcomes & accountability to make informed funding decisions • Anticipate changes over time based on our work with the field in these planning sessions • Begin commitment to address known challenges over a reasonable period of time • Support predictable, user-friendly processes • Responsive to persons receiving MH/AoD services

11. The Known Sequester • As a new consolidated organization, we are committed to sharing a strategy across grants to the extent possible • Examples: shift some SAPT spending related to dual diagnosis; relieve other shared administrative obligations where possible • Limited opportunities

12. The Known Sequester • SAPT13 Sequestration

13. The Known Sequester • For SAPT: • Maintain women’s MOE and prevention set-aside • Shift some project grants to other sources • Apply selective reductions to project grants • Timing

14. The Known Sequester • For MH BG: • Maintain formula awards to Boards • Maintain priority pops – SMI, SED • Shift some responsibilities to other sources • Apply selective reductions to project grants • Timing?

15. If Sequester Continues • No formal communication received from SAMSHA to indicate this will happen, or that the 5% initial sequester reduction amount would be the actual amount reduced • Amounts if a 5% carries forth (based on FFY13 awards): • SAPT: $3,299,568 • MH BG: $721,932

16. If Sequester Continues • Frame the options • Across the board? • Notwithstanding MOE and other requirements • Amount on “base” v. amount on grants

17. Scenarios • We want to achieve two plans by the end of this process: • FY 14 with FFY13 total sequester impact of $4.1MM (both MH and SAPT) • FY 14 with continued sequester against FFY14 MH and SAPT Block Grants • Both scenarios must contemplate SAPT alignment activities

18. SAPT Alignment: the Problem • Basic Information: • Feds allow the state 8 quarters to spend the grant, but we spend SAPT in the first four quarters of the federal award. • Historically resources obligated to the field in July include an October SAPT Award. • Example: SAPT13 October Award supports SFY14 1st quarter and SAPT14 October Award supports SFY14 2nd, 3rd, and 4th quarters • Only 25% of cash for the SFY is liquid and available for disbursement.

19. SAPT Alignment: Proposed Solution • Stretch SAPT Award allocation over more quarters in order to come into alignment with the amount actually available to support SAPT revenues • Will result in less cash to the field in short term, but more predictability in short and long term • What terms need considered? • How may impacts be managed?

20. SAPT Alignment: Proposed Solution • Proposed SAPT alignment solution for reserve Alignment applied over a 5 quarter period would build an SAPT reserve at the Department to off-set federal cash delays. Restored SAPT funding decisions could resume after the initial 5 quarters.

21. SAPT Alignment: Proposed Solution • Need to “catch up” approximately $3MM each quarter in order to align with federal award availability: • No other resources available to cushion the gap that occurs during alignment process • Component for consideration: • Programs funded with multiple sources (Block Grant, State GRF, Rotary) and how to manage the Block Grant Reduction fairly.

22. Logistical and Fiscal Items • NEED TO FRAME OUT: • Push vs. draw • Reporting • Other?

23. Next Steps • For SAPT alignment • Logistical/fiscal • Other? • Next meeting or specific assignments