Governor's FamilyCare Proposal Is Included in the Budget: Federal Waiver Is Last Step to Start Program

The final state budget sent to Gov. George Ryan includes an appropriation of $40 million to start the FamilyCare program on January 1, 2003. The appropriation authorizes the spending of the federal funds that would be generated when the federal government grants the Illinois FamilyCare waiver.

That request is still pending in Washington, and negotiations are ongoing over finalizing the waiver. State officials’ best estimate as to when it will be granted is mid- to late June, and those officials are very optimistic that the waiver will indeed be granted when the details are settled.

Governor Ryan filed the federal waiver request on February 15. A week later he announced his 2003 fiscal year budget proposal, which included the $40 million appropriation for FamilyCare. Throughout the very difficult spring legislative session, amid ever worsening financial news for the state, FamilyCare stayed in the administration’s plans. At least one legislative “doomsday” budget would have cut the FamilyCare appropriation out of the budget, not because this would save any state money (the appropriation is entirely federal funds), but because of a “no new programs” attitude and fears (unfounded) about possible uncontrollable spending obligations in later years (Illinois retains full control over this under the waiver).

Nevertheless, Governor Ryan reasserted the FamilyCare appropriation in his extraordinary Memorial Day speech announcing his second comprehensive budget proposal for the 2003 fiscal year. The legislative leaders had their fears or misconceptions about FamilyCare satisfactorily answered in the ensuing days, and FamilyCare stayed in all further versions of the budget.

The negotiations on the federal waiver are ongoing. Illinois will receive less matching money than originally expected. Illinois now can expect about $40 million in federal money matching existing state expenditures (instead of $80 million).