First 5 Raising Concern Over Brown’s Plan To Shift Prop. 10 Funding
California's First 5 program isÂ expressing concern about whether it could withstand Gov. Jerry Brown's (D) proposal to shift $1 billion in reserve funds from Proposition 10 to Medi-Cal, California's Medicaid program, California Watch reports.
In 1998, voters approved Proposition 10 to establish the California Children & Families Commission, also known as First 5.
The proposition imposed a 50 cent tax on cigarette packs to raise funds for First 5, with 80% of the revenue going to county-level First 5 commissions and 20% going to the state commission.
The commissions use the tobacco tax revenue to fund early childhood health and education programs, with any unused funds rolling over to the next year.
According to Brown, the state and local First 5 commissions had collected more than $2 billion in reserves as of June 30, 2009. Brown's budget proposal would divert half of those reserves to help fund Medi-Cal services for children up to age 5.
The governor also plans toÂ ask voters to approve a permanent transfer of 50% of all Proposition 10 revenue to support early childhood services through California's general fund.
Such a move would add about $216 million to the general fund for fiscal year 2012-2013, according to California's Department of Finance.
First 5 Concerns
The First 5 Association, a not-for-profit membership group for the county commissions, says First 5 does not have $2 billion in reserves.
Sherry Novick, executive director of the association, said records show that county First 5 reserves were slightly more than $355 million as of June 30, 2010.Â She said Brown's budget proposal reflects First 5's fund balance from 2009, but does not account for designated and reserved funds.
NovickÂ said that although county First 5 commissions had a fund balance of $1.9 billion last year, about 48.5% of those funds were contractually obligated to existing projects and 33.1% were designated for specific projects, but not under contract. Novick said the remaining 18.4% of the funds represented First 5's reserve (Lin, California Watch, 1/13).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.