This Fiscal Note is not an official copy and should not be quoted or cited.
Fiscal Note - SB 0959 - Community Partnership Program
L.R. NO. 3571-01
BILL NO. SB 959
SUBJECT: Community Partnership Program
TYPE: Original
DATE: March 29, 1996
FISCAL SUMMARY
ESTIMATED NET EFFECT ON STATE FUNDS
FUND AFFECTED FY 1997 FY 1998 FY 1999
General Revenue* ($47,112) ($69,104) ($70,233)
Community
Partnership
Program Fund (Unknown) (Unknown) (Unknown)
Partial Estimated
Net Effect on All
State Funds ($47,112) (Unknown) (Unknown)
* Known costs would be for a Program Development Specialist for the
Department of Social Services. Other unknown General Revenue costs not
included.
ESTIMATED NET EFFECT ON FEDERAL FUNDS
FUND AFFECTED FY 1997 FY 1998 FY 1999
Federal $0 (Unknown) (Unknown)
Partial Estimated
Net Effect on All
Federal Funds $0 (Unknown) (Unknown)
* Unknown receipt of federal block grant monies. DFS would incur costs of
$25,000 in FY98 and FY99 for the independent evaluation contractor.
ESTIMATED NET EFFECT ON LOCAL FUNDS
FUND AFFECTED FY 1997 FY 1998 FY 1999
Local Government $0 $0 $0
FISCAL ANALYSIS
ASSUMPTION
The Office of Administration (OA), Division of Budget & Planning, the Office
of the Lieutenant Governor, Harris-Stowe State College, Northeast MO State
University, Southwest MO State University, University of MO, the Office of
the Governor, Central MO State University, MO Western State College and MO
Southern State University do not expect to be fiscally impacted.
The Secretary of State (SOS) estimates costs for additional publishing duties
related to the Division of Family Services (DFS) being able to promulgate
rules, forms and other controls as necessary. DFS currently has 272 pages of
rules covering 29 programs in the Code of State Regulations. Individual
programs run from 4 to 74 pages in length with the average being
approximately 10 pages. The SOS assumes that this proposal suggests a level
of detail greater than the statistical average, thus, the SOS estimates an
additional 30 pages of rules in the Code and 90 pages of proposed, ordered or
amended rules in the Missouri Register. The estimate represents rulemaking
activity that is historically similar in length and number to the agency's
prior rulemaking. The actual fiscal impact would be dependent upon the
actual rulemaking authority. For purposes of this fiscal note, the SOS
estimates costs at $2,940 in FY97. The SOS does not anticipate the need for
additional staff as a result of this proposal. However, the enactment of
more than one similar proposal resulting in a minimal fiscal impact to the
SOS could require an increase in the SOS's appropriation for such purposes.
However, Oversight assumes SOS could increase fees to cover additional costs,
per Section 536.033 RSMo, and therefore, has not included these costs in the
fiscal impact for the proposal.
The Coordinating Board for Higher Education (CBH) assumes that it or any
public two or four year college or university could be fiscally impacted, but
since participation is not mandated the fiscal impact would be unknown. For
purposes of this fiscal note, CBH has ranged costs from $0 to unknown
depending on the level of participation. Oversight has shown the fiscal
impact as unknown for FY98 and FY99. FY97 would be zero assuming an
implementation date of July 1, 1997.
The Department of Revenue (DOR) indicates an unknown fiscal impact. DOR
expects to incur costs related to system modifications, form/schedule
revisions, verification, processing functions and taxpayer inquires as well
as a small administrative impact to administer the tax credit. However,
given various questions related to the credit such as how would the credit be
determined or what taxes would it be applicable to, DOR cannot make a
determination of the fiscal impact. Oversight assumes that the first year
tax credits could potentially be claimed would be FY98. FY97 has been shown
as zero.
The Department of Elementary & Secondary Education (DES) does not expect to
be fiscally impacted. Furthermore, DES assumes that schools could choose to
participate in the program, but the costs incurred would be strictly
voluntary and cannot be estimated. Oversight assumes costs would be incurred
in FY97 assuming an implementation date of July 1, 1997.
The Department of Social Services (DOS), Division of Family Services (DFS)
assumes that it would be fiscally impacted by this proposal. DFS assumes
that it would be necessary to hire two Program Development Specialists (PDS)
effective January 1, 1996. One PDS would make application for the necessary
federal waivers; prepare federal and state reports, evaluations and state
policy changes; prepare policies, procedures and forms; act as an on-going
liaison between DFS and other agencies; and contract and serve as a liaison
with the independent evaluation contractor. The other PDS would serve as a
field liaison with the community partnership organizations; ensure the
operation of the mandated hotline; serve as a contract specialist; ensure
that qualified individuals are not involved in more than one contractual
agreement with a community partnership organization; work with the Divisions
of Budget & Finance and Data Processing with regards to payment systems; and
compile and provide information on participating community partnership
organizations as mandated. Costs would be 100% general revenue (GR) since
DFS cannot assure that overall savings would be realized as a result of this
proposed eligibility change in accordance with the cost neutrality pact
associated with a Federal 1115 Demonstration Waiver. Oversight assumes that
one PDS would be needed for six months during FY97 for the purpose of
obtaining the waiver, with on-going costs being included for the remaining
FTE. As adjusted, costs would be $47,112 in FY97; $44,104 in FY98; and
$45,233 in FY99.
Additionally, a Federal 1115 Demonstration Waiver would require that affected
participants be divided into an experimental and control group for evaluation
purposes. It was assumed that the pilot counties would serve as the control
group and would be chosen randomly. An independent evaluation contractor
would also be required under the auspices of the waiver. DFS assumes that
the evaluation contractor would be paid $100,000 over a two year period
(i.e., FY98 and FY99). The waiver evaluation costs would be split 50% federal
and 50% GR. DFS assumes that a waiver could be approved and implemented by
July 1, 1997.
DFS indicates it cannot estimate costs associated with the Community
Partnership Program because it cannot be ascertained how many community
partnership organizations would have an interest or administrative funds
available and there is no way to determine the number of clients who would be
interested in such a program. The proposal would provide that monies be
appropriated to the Community Partnership Program Fund to provide benefits to
qualified individuals that are at least equal to the benefits the individual
would otherwise receive plus an amount at least equal to 10% of the total
amount transferred or savings resulting from the implementation of the
program. Based on FY95 expenditures and FY96 appropriations, DFS estimates
the administrative costs related to the Aid to Families with Dependent
Children (AFDC) program at approximately 4% of the benefits issued. The
estimate does not take into account the AFDC administrative costs for the
support divisions (i.e., Legal Services, Budget & Finance, Data Processing
and General Services). DFS assumes that based on the language of the
proposal and the assumption that dual payment and eligibility systems would
be mandated, the cost of the program would exceed current appropriations, but
the amount would be unknown.
For purposes of this fiscal note, Oversight has shown unknown income to the
Community Partnership Program Fund from appropriations, the additional 10%
and the fee which could be accessed against the participants. In addition,
the provision of services has been shown as an unknown cost. It was assumed
that fund would not net to zero, but costs would more than likely exceed the
income level.
The Division of Budget & Finance (DBF) assumes that the proposal would create
additional audit responsibilities because the DBF would be responsible for
performance and financial audits of the department's agreements with the
community partnership organizations. DBF assumes that it would need one
Auditor I to complete annual reviews on each of 30 contracts. It would take
approximately 70 hours per audit, including travel, report preparation and
review time. Oversight assumes that since DFS was unable to estimate the
number of potential contracts that the cost to DBF would be unknown as well.
Depending on the number of contracts which would result from this proposal,
DBF would require 1 FTE for every 30 contracts at an annual cost of
approximately $37,000. Costs would be 100% GR.
The Division of Legal Services (DLS) did not indicate any immediate fiscal
impact, but did indicate an unknown long-range fiscal impact. DLS assumes
that there are so many unknown factors that it cannot determine what its'
involvement in the program would be now or in the future.
The Division of Medical Services (DMS) does not expect to be fiscally
impacted since the proposal defines "qualified individual" as any individual
who receives any cash or in- kind payment, or any other benefit administered
by the Division of Family Services. DMS assumes that the language would not
include the reimbursement of claims for medical care (i.e., Medicaid) as it
is currently administered cooperatively by the federal government (Health
Care Financing Administration) and the State of Missouri.
FISCAL IMPACT - State Government FY 1997 FY 1998 FY 1999
(10 Mo.)
GENERAL REVENUE
Costs-Coordinating Board for Higher Ed (CBH)
Participation as a Community Partnership
Organization $0 (Unknown) (Unknown)
Costs-Department of Revenue (DOR)
Tax Credits $0 (Unknown) (Unknown)
Costs-Department of Social Services
Division of Family Services (DFS)
Personal Service (1.5 FTE) ($28,905) ($29,628) ($30,368)
Fringe Benefits ($8,885) ($9,108) ($9,335)
Expense and Equipment ($9,322) ($5,369) ($5,530)
Total Costs-DFS ($47,112) ($44,104) ($45,233)
Independent Contract Evaluator $0 ($25,000) ($25,000)
Division of Budget & Finance (DBF)
Personnel/Expense & Equipment $0 (Unknown) (Unknown)
PARTIAL ESTIMATED NET EFFECT
ON GENERAL REVENUE FUND ($47,112) ($69,104) ($70,233)
COMMUNITY PARTNERSHIP PROGRAM FUND
Income
Monies Appropriated to the
Fund Plus 10% of Transfer
or Savings $0 Unknown Unknown
Income
Fee Charged Participants $0 Unknown Unknown
Costs
Provision of Services $0 (Unknown) (Unknown)
ESTIMATED NET EFFECT ON
COMMUNITY PARTNERSHIP
PROGRAM FUND (Unknown) (Unknown) (Unknown)
FEDERAL
Costs-Department of Social Services
Division of Family Services (DFS)
Independent Contract Evaluator $0 ($25,000) ($25,000)
ESTIMATED NET EFFECT ON
FEDERAL FUNDS $0 ($25,000) ($25,000)
FISCAL IMPACT - Local Government FY 1997 FY 1998 FY 1999
(10 Mo.)
$0 $0 $0
FISCAL IMPACT - Long Range
The Department of Social Services (DOS), Division of Legal Services (DLS)
indicates an unknown fiscal impact given the number of unknown factors
involved with the Community Partnership Program.
DESCRIPTION
The proposal would enact the "Community Partnership Program" in order to
promote diverse approaches to the problem of poverty and to encourage maximum
local participation and volunteerism.
Qualified individuals could choose to participate in the Community
Partnership Program, but anyone who elects to participate would be required
to enter into a contractual agreement with the community partnership
organization. The community organizations could contract with the Division
of Family Services (DFS) to distribute benefits to qualified individuals.
The responsibilities of DFS would be as outlined, including the development
of standardized contractual forms and the establishment of a hotline.
Community organizations in establishing and maintaining a community
partnership program could charge a fee for the provision of services equal to
the amount of the organization's administrative costs, but as a percentage of
the benefits, the fee could not exceed 10%. Supplemental benefits could be
provided as well. The organizations could require qualified individuals to
meet additional standards as a condition of receipt of benefits.
Failure on the part of the qualified individual to meet the requirements of
the contract would result in the forfeiture of any increase in benefits. If
a contract were terminated, the qualified individual would be deemed a
non-participant for 30 days or until another contract is entered into,
whichever is less. If deemed to be non-participants due to the termination
of the contract, the individual would still receive benefits as otherwise
provided by law.
DFS would require the community organizations to meet the conditions outlined
in the proposal. Community organizations could actively seek private
donations. Any Missouri citizen could claim a tax credit, the amount to be
appropriated, but not less than the savings realized by DFS as a result of
this program.
The Community Partnership Program Fund would be established. Monies would be
appropriated to the fund to provide benefits that are at least equal to the
benefits otherwise received plus at least 10% of the total amount transferred
or the amount of savings resulting from the implementation of this program.
Gifts, grants, contributions, appropriations and funds or benefits would be
the sources of income for the fund. Unexpended balances would be invested
with the interest, dividends and monies earned deposited back into the fund.
The Community Partnership Advisory Council would be established to make
recommendations to DFS on ways to improve and expand the program. The
Council would meet at least twice yearly to review activities and make
recommendations to the Governor.
This proposal would become effective when the state receives federal block
grant funding.
This legislation is not federally mandated, would not duplicate any other
program and would not require additional capital improvements or rental
space.
SOURCES OF INFORMATION
Department of Social Services
Secretary of State
Coordinating Board for Higher Education
Department of Elementary & Secondary Education
Department of Revenue
Office of Administration
Division of Budget & Planning
Office of the Governor
Office of the Lieutenant Governor
University of Missouri
Southwest MO State University
Central MO State University
Northwest MO State University
MO Southern State University
MO Western State University
Harris-Stowe State College
NOT RESPONDING: Truman State University, State Fair Community College,
Southeast MO State University, Lincoln University