Local Management Boards Raise Budget Concerns

Members of the Maryland Association of Local Management Boards briefed the Joint Committee on Children, Youth, and Families last week raising budget concerns for the upcoming fiscal year.  Panelists also spoke of the important role Local Management Boards (LMBs) play in connecting children and families with needed services in the community.  A document provided to the joint committee described the current budget situation.

The overall funding for LMBs has been reduced from over $54 million in 2008 to just $16 million in FY 2011 and 2012. Many of these “cuts” were actually a diversion of funds usually spent at the local level.

For FY 2013, a one-time fund removed another $7.3 million from the Children’s Cabinet Interagency Fund (CCIF) as LMBs used locally held “earned reinvestment money” as nonbudget funding to stay even with FY 2012.

Written testimony provided by MACo further explains the fund swap and the potential effect on the LMBs Fiscal 2014 budget.

In Fiscal 2013, to relieve pressure on the general fund and fund the LMBs at the prior year level, a fund swap occurred where earned investment account dollars, which are a part of the Children’s Cabinet Interagency Fund, were used to replace $7.3 million in general funds previously allocated to the LMBs.  The LMBs agreed with this fund swap although it was dollars earned by the LMBs as a result of returning and diverting youth from out-of-state placement and keeping children with their families. This fund swap depleted the balance in the earned reinvestment account for most counties, providing one-time budget relief for Fiscal 2013. However, a comparable alternative funding source does not again exist for Fiscal 2014 to provide similar general fund relief.   Without the full general fund support (comparable to those levels provided prior to the one-time fund swap), essential LMB funding would be reduced by almost half.  A reduction of this magnitude would severely affect the services provided to children and families across the State.

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