(C) Arizona Mirror
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Lawmakers approve DCS funding transfer after heated partisan debate [1]
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Date: 2025-03-20
Kids in the care of the Arizona Department of Child Safety won’t have to sleep in the agency’s offices next week, after a bipartisan group of legislators voted to transfer funds so that DCS doesn’t default on payments to group homes.
Ultimately, lawmakers on the Joint Legislative Budget Committee unanimously approved a funding transfer Thursday, four days before the congregate care program was expected to run out of money. But that agreement came after several days of political drama, along with heated debate during Thursday’s JLBC meeting about who was at fault, and whether Republicans were exaggerating the severity of the problem or Democrats were downplaying it.
House Republicans called a press conference on Monday to announce that DCS would “go bankrupt” next week because of Hobbs’ financial mismanagement. In reality, one DCS program, called congregate care, was expected to run out of money March 24, and the department had asked JLBC if it could transfer unspent money from other programs to make up the difference.
Democrats argued that line item transfers were a routine part of budgeting, pointing out that the same GOP-controlled committee rubber-stamped a total of nearly $50 million in transfers within departments for former Gov. Doug Ducey, a Republican.
But Rep. David Livingston, the Peoria Republican who is chairman of the JLBC, claimed this instance created a serious problem because DCS only gave JLBC a 19-day heads up before congregate care was expected to run out of money.
DCS has included a shortfall in its congregate care budget since September, and a DCS deputy director, Alex Ong informed legislators about it during a January meeting. But the department didn’t inform JLBC of the specific day funds would run out until March 5.
Livingston also took issue with what he described as a “demand letter” that DCS and Hobbs sent him — a physical letter sent to the wrong address — which he called unprofessional. In the letter, which JLBC staff received via email, Hobbs said that if JLBC didn’t approve the funding transfer, children could be kicked out of their group homes and might have to sleep in DCS offices.
Following more than an hour of debate, the panel unanimously agreed to transfer the originally requested $6.5 million from other DCS programs to keep congregate care solvent for another month. The committee also approved a $2.5 million transfer to fund extended foster care services through May, which was short on funds because of an unexpected increase in cases.
And lawmakers approved an additional $10 million in potential surplus funding from other areas of the DCS budget to keep congregate care solvent through near the end of the fiscal year on June 30.
Before the committee members agreed to the funding transfers, Livingston criticized Hobbs at length, telling the Democratic legislators on the committee that they should be just as angry at the governor’s budgeting mistakes as he was.
“I’m frustrated with my colleagues that you don’t understand how badly the governor has done,” Livingston said.
The larger issue, according to JLBC Director Richard Stavneak, is that the state continues to use a budgeting practice of treating ongoing funding, or funding that is necessary annually, as if it was one-time funding that won’t be needed the following year.
The state budget has treated around $20 million in funding for congregate care that way since Ducey was governor, with that money used to make up for decreased federal funding. The state did that with the intention that DCS would work to reduce the number of kids who need congregate care, and would eventually not need the extra $20 million, on top of the program’s ongoing budget of around $100 million.
Livingston blamed Hobbs for not fighting hard enough to ensure that the additional $20 million was in the current year’s budget, adding that even though Republicans and Democrats in the legislature signed off on that budget, it was ultimately Hobbs’ job to ensure that the departments she oversees were adequately funded.
In the fiscal year 2026 budget, which must be approved by Hobbs and the legislature by June 30, Hobbs has requested $23 million in additional ongoing funding for congregate care.
In an emailed statement following the JLBC meeting, Hobbs called Republicans’ reactions to the funding transfer requests “shameful political stunts.”
A spokesman for Hobbs did not immediately respond to specific questions about some of Livingston’s claims.
Both Hobbs and House Minority Leader Oscar De Los Santos, of Laveen, continued to accuse Republicans of inflating the seriousness of the congregate care funding shortfall to distract from their continued refusal to appropriate $122 million necessary to fund vital services for people served by the Division of Developmental Disabilities before it runs out in April.
“The Department of Child Safety is not running out of money next week, as the Republicans claim,” he said in the statement. “This is a pathetic attempt to distract voters from the fact that, just yesterday, House Republicans killed a bill to provide emergency funding for kids with cerebral palsy, Down syndrome, autism, and other developmental disabilities. If the Republicans don’t act in the next few days, these children will be cut off from lifesaving services. They are attempting to distract you when they should be making life better for disabled kids across Arizona.”
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[1] Url:
https://azmirror.com/2025/03/20/lawmakers-approve-dcs-funding-transfer-after-heated-partisan-debate/
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