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Lawmakers frustrated with projected $22 million deficit at DCYF

Target 12
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PROVIDENCE, R.I. (WPRI) – The embattled R.I. Department of Children, Youth and Families expects to overspend its budget by nearly $22 million this fiscal year, testing a new requirement that restricts overspending across agencies.

The R.I. Office of Management & Budget on Thursday released first-quarter financial statements across state agencies for the fiscal 2019-20 year, revealing DCYF is on track to spend 13% more than the $165 million it received in general revenue in the current state budget.

Two other agencies, R.I. Office of Veterans Services and R.I. Department of Education, are also projecting multimillion-dollar deficits, although not as severe as DCYF.  

The trend raises questions about how the overspending will fit into a new law championed by the General Assembly that restricts overspending.

The change, known as Article 2, was passed as part of the current budget and begrudgingly signed into law by Gov. Gina Raimondo, who sharply criticized the restrictions.

For years, state agencies would regularly spend more than they received and then would request supplemental funds later in the fiscal year when actual expenses became more clear.

After the current state budget took effect on July 1, OMB issued regulations that determined overspending was allowed if necessitated by “immediate health and safety reasons.”

In a letter dated Nov. 7, OMB Director Jonathan Womer wrote to DYCF acting director Kevin Aucoin saying much of the overspending at DCYF – especially as it relates to child placements, the R.I. Training School, and staffing – is allowable under the definition of “immediate health and safety reasons.”

Womer, however, warned DCYF his office would more closely scrutinize the state’s child welfare agency moving forward. The director also wrote that all existing and future contracts “will be subject to OMB review and approval during the period of enhanced fiscal oversight.”

“Until the OMB quarterly projections demonstrate that DCYF is not projecting a deficit, OMB and DCYF staff will meet on a weekly basis to review personnel and expenditure requests in order to remain in full compliance of Article 2,” Womer wrote.

When asked about DCYF’s financial statement, House Finance Chairman Marvin Abney – who oversees the state budget process – said in a statement he was disappointed.

“The safety of the children under the state’s care is an absolute priority and we need to ensure services are properly funded and delivered,” Abney said. “However, it is disappointing that the administration’s budget projections were so far off the mark, especially given all the resources and data available.”

Senate President Dominick Ruggerio echoed Abney.

“Time and time again, the members of the Senate Finance Committee asked DCYF officials, in frustration, if their level of funding was sufficient. They testified that it was. Next year’s budget request is already late, but we hope that the governor’s funding recommendation is more in line with actual service needs,” Ruggerio said.

The state this year has already allocated an additional $6.3 million in general revenue to cover unexpected DCYF costs from the previous fiscal year. DCYF subsequently overspent that amount by $3.3 million, according to legislative officials.

The agency ultimately will be required to submit a corrective action plan to OMB, according to Article 2.

DCYF, while facing the largest challenge, isn’t the only state agency with money problems.

Veterans Services is projecting a near $3 million deficit related to “unanticipated expenses” at the Veterans’ Home.

Likewise, the Department of Education is projecting $2 million in extra costs, which it attributes to unexpected expenses related to Central Falls Public Schools, the R.I. School for the Deaf and teachers’ retirement. A department spokesperson said education officials are working to provide updated figures and savings initiatives.  

An OMB spokesperson said state officials were in “serious discussions” with the two agencies.

Abney said his committee would be taking a closer look at DCYF.

“The House Finance Committee will undertake a deeper review of the department’s report, management practices and financial projections, including the recently revealed deficit from last year,” he said.

Eli Sherman (esherman@wpri.com) is a Target 12 investigative reporter for WPRI 12. Follow him on Twitter and on Facebook.

Copyright 2019 Nexstar Broadcasting, Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

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