District/School Administration Administration
The Massachusetts Board of Elementary and Secondary Education

Governor's FY2010 Budget Recommendations "House 1"

On January 28, 2009, the Governor released "House 1," his Fiscal Year 2010 Budget Recommendations to the Legislature, as well as, a second round of 9C cuts to the FY2009 Budget (DESE was cut an additional $7.1 million for FY2009, for a total cut, including the October 9C cut of $37.4 million.) The Governor's FY2010 Budget is based on significantly fewer projected FY2010 revenues and the Department's (DESE) FY2010 funding reflects this down-turn in projected revenues at the national, state and local levels. Even with the dramatic reductions in FY2010 projected revenues, the Governor kept his promise not to cut Chapter 70, Foundation Aid. House 1 level funds Chapter 70 at the FY2009 amount of $3.949 Billion.

The non-Chapter 70 Department accounts are funded at a total of $544.6 million in FY2010. This represents a reduction of $28.8 million from our FY2009 post 9C appropriated level of $573.4. There are two actions/initiatives that the Governor is proposing in House 1 that account for the $28.8 million reduction.

First, the Governor is proposing a state-wide Information Technology (IT) Consolidation Initiative. All DESE IT resources currently funded in FY2009 will be transferred under this initiative, to the Secretary's Office under the direction of the Secretary's Chief Information Officer. This IT Initiative will transfer approximately $7.0 million and 30 IT staff from the Department's FY2010 Budget to the Secretary's FY2010 Budget. Each agency within the Secretariat will maintain and continue IT and data services under the direction of the Secretary's Chief Information Officer. The specific details of how this IT Initiative will work in FY2010 and beyond, have not yet been distributed to departments.

Second, House #1 also proposes the consolidation all of the Department's similar programs into substantially fewer consolidated programs. A sample of the program consolidations is the three literacy programs in FY2009, totaling $6.6 million (Bay State Reading of $1.2M, John Silber Literacy of $3.2M and Early Tutorial Literacy of $2.2M) into one new Literacy Program in FY2010 totaling $4.6M. The new Literacy Program contains line item language that specifically names the original three programs, but is silent on the FY2010 allocations to any of the three programs listed within the new program. The new FY2010 new Literacy Program funding is $1.8 million less than the FY2009 post 9C spending of $6.6 million.

House 1 anticipates that the IT Initiatives and the Program Consolidations will result in cost efficiencies and greater DESE latitude to address education priorities and reduce administrative costs.

The attached chart details the Department's House 1 funding Recommendations. The chart lists the columns from left to right:

• The account number.
• The account name, the new consolidated accounts are in blue text.
• The FY2009 Budget as appropriated in July, before any 9C reductions.
• The total of all 9C reductions, rounds 1 & 2, in October and January.
• The Department's FY2009 spending levels, post 9C reductions.
• The approved FY2009 staffing level for each administrative account.
• The House 1 Budget Recommendation. Below the House 1 Recommendation is the variance between the FY2010 recommendation and the FY2009 post 9C spending level, and immediately to the right is the percent variance between the two columns previously referenced.
• The FY2010 approved staffing level for the each administrative account.

Also, each account/program that is impacted by the Governor's IT Consolidation Initiative has two notes, in blue text, immediately below the account funding details. The first note lists the funds and staff that are transferred to the Secretary as part of the IT Initiative. The second note lists the actual dollar and percent variance to FY2009 spending levels, when adjusted for the IT transfers.

I am aware that the attached chart is substantially different from all previous charts that have been sent for your review. We are available to help walk you through the House 1 recommendations and related consolidations. If you have any questions, please do not hesitate to contact me at #3100, Tony DeLorenzo at #6598 or Jeff Wulfson at #6500.

Attachment

Analysis of ESE's FY2009 Funding to the Governor's Consolidated House #1 Recommendation