The SCAN Foundation: Summary of California’s Enacted 2012-13 Budget: Impact on Older Adults and People with Disabilities
When Governor Brown released the 2012-13 proposed budget in January, the Department of Finance projected a general Fund (GF) shortfall of approximately $9.2 billion through the period ending June 30, 2013. The May Revision of the 2012-13 budget reflected a budget deficit increase of $6.5 billion over the January projections for a total of $15.7 billion. This increased budget deficit resulted from lowerthan-anticipated tax revenues, increased costs to fund K-12 education, as well as court rulings and federal government determinations that prevented implementation of previous budget reductions.To close this $15.7 billion budget deficit and adopt a nearly $1 billion reserve, the enacted budget relies on spending reductions, tax increases and other solutions. In total, the budget outlines $8.1 billion in spending
cuts, assumes approximately $6 billion in new GF revenues from voter approval of the tax initiative in November 2012 and other revenue measures, and adopts other solutions for $2.5 billion.
The enacted 2012-13 budget assumes the passage of the governor’s proposed tax initiative (The Schools and Local Public Safety Protection Act) at the November 2012 election. The initiative would increase the personal income tax for seven years on California taxpayers earning more than $250,000 and would increase the sales and use tax by one-quarter of one percent for four years. The governor estimates that the measure will generate approximately $8.5 billion in new revenues in 2012-13, with $2.9 billion funding for schools and community colleges and a net increase of $5.6 billion in GF revenues. Should voters fail to pass the ballot initiative, the Legislature outlines a series of “ballot trigger cuts” totaling approximately $6 billion that would go into effect on January 1, 2013. The trigger cuts would primarily impact education (K-12 and higher education), but also include trigger reductions of $50 million to developmental services.
Budget Initiatives Impacting Seniors and Persons With Disabilities
The Coordinated Care Initiative
Enacted as part of the 2012-13 budget, the Coordinated Care Initiative (CCI) includes a number of changes to the medical care and long-term services and supports (LTSS) systems impacting persons eligible for both Medicare and Medi-Cal (“dual eligibles”) as well as individuals who are eligible for Medi-Cal only (seniors and persons with disabilities), for a GF savings of $611.5 million in 2012-13. The main provisions are summarized below.
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