POLICY ANALYSIS SERIESISSUES RELATED TO WELSCH V. NOOT /NO. 6THE FINANCIAL STATUS OF MINNESOTA DEVELOPMENTALACHIEVEMENT CENTERS: 1980-1982Contents1. Introduction Il. MethodologyIII. Results: Revenue Expenditures Profit/Loss Program Per Diems Transportation Per Diems Capital Assets (Building) Capital Assets (Vehicles, Furniture, Equipment) Building Accessibility Capacity Average Daily Attendance IV. Implicationsv. References VI. Appendix1. INTRODUCTIONThe issues creating the impetus for this statewide study of developmental
achievement centers (DACS) are the same issues that generated similar reports for the past-several years. These issues are cost, purpose, and characteristics about the agencies and clients served. Similar to previous studies, there is a pressing need for information since the combined federal, state, and local cutbacks have an effect on community-based programs such as DACS. In addition, the Community Social Services Act (CSSA) went into effect on January 1, 1980, thus terminating the existing Department of Public Welfare data base developed for DACS. The potential use of Title XIX as one funding mechanism for DACS has created an intensified demand for information about clients, personnel, and services. This policy analysis paper is the first of three issues to present the results of a statewide study of all DACS in Minnesota The second paper (Policy Analysis Series #7) will focus on program and personnel, and the third report (Policy Analysis Series #8) will profile individual client characteristics and movement trends.
DEVELOPMENTAL DISABILITIES PLANNING* DEPARTMENT OF ENERGY, PLANNING AND DEVELOPMENT '
201 CAPITOL SQUARE BLDG. 550 CEDAR STREET ST. PAUL, MN 5510l
612/296-4018
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A Department of Public Welfare report completed in 1978 provides historical information about DACS. Highlights from that report are presented as follows:
Prior to 1961, few DACS existed in Minnesota (p. 22).
In 1961, the Minnesota Legislature acted upon recommendations of the Interim Commission on the Problems of the Mentally Retarded, Handicapped and Gifted Children and funded a pilot project to develop nine DACS [Extra Sessions Law of Minnesota for 1961, Chapter 93.] (P. 22).
In 1963, the Legislature appropriated funds for 14 additional centers under the Daytime Activity Center Act [Chapter 830 of the Session Law.] (p.23).
Title IVA and Title XX provided federal support to the state with minimal financial commitment of counties (p. 23).
The Trainable Mentally Retarded Act of 1971 made the State Department of Education responsible for all school age children, who could reasonably expect to benefit socially, emotionally, or physically from their service. DACS shift focus to serving only preschoolers and adults (p. 23).
In 1975, the Minnesota Legislature provided a special appropriation to pay for 100 percent of approved costs for transportation of DAC clients to and from DACS (p. 23).
In 1976, Assistant Commissioner Mike Weber requested a study of DACS including characteristics of the population, movement of clients, administrative standards and practices as well as unmet needs (p. 24).
In 1976 an internal DPW working paper Policy Alternatives for Daytime
Activity Centers highlighted major problems including the "absence of a clear goal for DACS as well as inadequate definitions of services, lack of information on clients being served, impact of services and measures of program effectiveness" (p. 3).
In 1977, the DAC Evaluation Project was funded to develop an instrument
to evaluate DACS (p. 24).
In 1978, DPW completed a comprehensive study of 104 DACS serving 4,221 participants at a total cost of $15 million (p. 34).
A review of the literature on day program services revealed little information. National surveys of activity programs were undertaken in 1963, 1971, and 1979 (Cortazza, 1972; and Bellamy, Sheehan, Homer, & Boles, 1980). In 1963, there were 94 programs identified nationwide. By 1971, the number increased by 612 programs and tripled by 1979 to an estimated 1,989. The primary purpose of activity centers in 1971 was described by Cortazzo (1972) as:
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The severely mentally retarded have a potential and are entitled as human beings in our society to have their potential developed to capacity. It is the responsibility of society to develop and make maximum use of their potential (P.9).
The rapid reinstitutionalization during the 1970s as well as funding changes cited by Bellamy et al (1980) "drastically altered the scope, economics, and role of ADPs." The 1980 report continued:
Today these programs represent a significant element of each state's adult service planning-and have become critical in efforts to disperse residents of public institutions into community programs. Adaptive day programs frequently are viewed as providing the initial services for newly reinstitutionalized individuals [DHEW Report on Deinstitutionalization, 1978], and placement of individuals out of institutions frequently is contingent on availability of space in adaptive day programs (p. 309).
The summary of the Bellamy et al report was to call for greater coordination of policies and the development of practical service models that include greater opportunities for work and vocational outcomes (p. 321). Other literature on day programs includes technological applications for severely retarded adults (Bellamy, Homer, and Inman, 1979) guidebooks for establishing activity centers (Bergman, 1976), and specific training operations within centers (Salmon, 1975; Wehman, 1976; and DeMars, 1975).
The purpose of the current study of developmental achievement centers is to assess the financial, programmatic, and client status during 1980, 1981, and 1982. A three-year time period was selected because little information existed at a statewide level since January 1, 1980. The study was conducted as a joint effort of the Department of Public Welfare, the Minnesota Developmental Achievement Center Association, and the Minnesota Developmental Disabilities Program.
II. METHODOLOGY
The methodology for this study will be presented in abbreviated fashion. According to DPW, there were 108 DACS listed as licensed facilities. One facility is a satellite of the Glacial Ridge Training Center of Willmar State Hospital, one other facility receives no public money and refused to participate. None of the State Hospital DACS were included in the DPW list nor were they included in this study. Information about satellite DAC pro
grams was collected from the respective central administrative offices. In order to get 100% participation, mail and telephone surveys were discarded in favor of on-site interviews. Interview studies typically yield a higher response rate, greater accuracy, and higher reliability than other methods. All 106 DACS participated in the study.
Policy Analysis Paper #6January 11, 1982Page 4The general areas of investigation were outlined in a working document prepared by DPW and MNDACA. A joint meeting of representatives from DPW, DD, and MNDACA was held on September 1, 1981 to discuss the purpose, method, timeline, procedures, and questionnaire areas. Suggested questions were generated at that meeting. The Developmental Disabilities Program drafted the questionnaires with assistance from DPW staff. On September 11, 1981 the MNDACA Board of Directors gave its approval to the study. Revisions were made until September 15th, when a briefing was held with three interviewers from DPW and five interviewers from DD. On September 29, 1981, interview materials were distributed to all the surveyors. An interview packet contained:
1. an interviewer manual which outlined the purpose, selection of respondents,
data privacy, question-by-question instructions, and sampling instructions;
2. cover sheet with identification information about the DAC;
3. administrator questionnaire;
4. financial, questionnaire;
5. individual client forms;
6. eligible client roster form; and
7. respondent determination sheet.
Interviewers were responsible for setting up appointments with the assigned
DACS. Interviews began on September 30, 1981, and ended in December 1981.
Editing and coding of the protocols occurred during November and December 1981
by staff of the Developmental Disabilities Program. Key to disc entry of the data was made by the Land Management Information Center of the Department of Energy, Planning and Development under contract with the Developmental Disabilities Program. The codebook (data file layout) and formats for the output were designed by the staff of the Developmental Disabilities Program. Copies of the questionnaires are available from-the by written request.
III. RESULTS
The results section will be presented in the Developmental Disabilities Program
followinq order: (a) revenue,(b) expenditures, (c) profit/loss, (d) program per diems, (e) transportation per diems, (f) capital assets (building), (e) capital assets (vehicles, furniture, equipment), (f) building accessibility, (g) capacity, and (h) average daily attendance.
Revenue. The total revenue reported for Minnesota developmental achievement
centers (DACS) during 1980, 1981, and 1982 (estimated) was $22,890,077~ $25,976,788 and $27,360,853 respectively, and is presented in Table 1. The total revenue during 1978 was approximately $15 million which indicates a steady increase in revenues. The statewide average increase in revenues from 1980 to 1981 was 13.5 percent; the increase from 1981 to 1982 will be
Policy Analysis Paper #6 January 11, 1982Page 6approximately 5.3 percent. The reader is advised that the 1982 figures are projections only since counties continue to revise budgets. The full extent of the 1982 budget changes cannot be assessed until the end of the fiscal year. The reader is also advised that the number of new clients and severity of handicaps has also increased during the three year time period and will be described in the forthcoming Policy Analysis Paper #8. In addition a "maintenance of effort" clause in the Community Social Services Act affected the level of county support in 1980 and 1981.
In 1980, government sources accounted for $21,566,315 or 94.2 percent of al 1 DAC revenue while family support totaled $401,072 (1.8%) and donations or other sources of support were reported at $922,690 (4.0%). Revenue derived from family support/fee payments is understated since in some localities family fees are paid directly to the counties. Resources generated through "other sources" and held in restricted accounts may also have been underreported.
DAC revenue for 1981 was derived from similar sources in similar proportions: government sources accounted for $24,650,217 (94,9%); family support generated $454,509 (1 .7%); and donations or other support provided $872,062 (3.4%).
OACS project that during 1982 government sources will provide approximately $25,961,000 or 94.9 percent of all DAC revenue; family support will equal about $514,000 (1.9%); and other sources will total about $886,000 (3.2%).
Table 1 also presents revenue totals by region. Region Two reported the lowest
total revenue ($493,153 in 1981) while Region Eleven reported the highest total revenue ($12,405,833 during 1981). This pattern corresponds with the State's population distribution patterns as well as other human service indicators. Although a few regions show substantial changes in DAC budgets from 1980 to 1982, most regions show only moderate increases; some figures indicate only marginal changes.
Expenditures. The financial questionnaire separated expenditures into four categories: personnel, transportation, occupancy, and other program.
Like most human services, day programming for persons with developmental disabilities is a labor intensive "industry." Staff-client ratios are highly correlated with the dependency level of clients (see also Policy Analysis Paper #4, 1981, page 10). Consequently, personnel costs are the leading expense items reported by DACS. Personnel costs included salaries, employers' payroll taxes, and any fringe benefits paid by the DAC for their employees. As Table 2 indicates, the statewide total for personnel costs was $14.2 million in calendar year 1980 or 62.4 percent of total expenditures. The personnel figure increased to $16.5 million in calendar year 1981 (63.3% of total expenditures) and is expected to increase to $17.7 million in 1982 which will represent 63.6 percent of all expenditures. Table 2 summarizes the other expenses reported by DACS.
1
See the appendix for a map of Minnesota's economic development regions. For
this study, regions 6E and 6W were combined and treated as one region (Region 6); likewise for regions 7W and 7E (Region 7).
Transportation was the second highest expense in all three years. Transportation expenditures were defined as the cost to the DAC for transporting clients to
and from the DAC center. Included in these figures are the bus drivers' wages and payroll taxes, operating costs, maintenance costs, and contract services. The expenditures listed in Table 2 show that transportation costs in calendar year 1980 were $3.4 million (15.0% of all expenditures), $3.94 million (15.2%) in 1981 and are expected to increase only slightly in calendar year 1982 to $3.96 million (14.3% of total expenditures).
The third expenditure category was occupancy. Occupancy costs' can be distinguished as costs incurred by owners and costs incurred by renters. Occupancy costs for owners included interest on building loans, property taxes, depreciation, up keep of grounds and utilities. For renters of buildings, occupancy costs included rent, miscellaneous upkeep and utilities. Table 2 indicates that occupancy costs totaled $1.8 million (representing 8.1% of total expenditures) during 1980. In calendar year 1981 that figure increased to $2.2 million (8.4%) and is projected to increase to $2.6 million (9.2%) in 1982.
The fourth category of expenditures was program or other. This category included all operating expenses not accounted for in the three other areas. Costs included were program supplies, postage, subscriptions, travel and meetings for staff and other depreciation. Program or other costs for 1980 were $3.3 million (14.5%), $3.4 million (13.1%) in 1981, and are projected to increase to $3.6 million (12.9%) in 1982.
Regional expenditure totals and percentage figures are also presented in Table 2.
Profit/Loss. Table 3 presents the "profit/loss" statement for DACS in Minnesota for 1980, 1981, and 1982 (projected). Profit/loss was defined as operating revenues minus program, personnel, and transportation expenditures. These figures do not include other non-service expenditures such as loan payments for buildings or vehicles. Profit/loss represents surplus or deficit after provision of services; it is not a cash flow statement. Thirty-four (34 or 32%) of the 106 DACS reported losses in 1980; 32 (30%) reported that expenditures exceeded revenue in 1981; and in 1982 40 (38%, N=105) DACS anticipate losses. This trend data should be watched in the future given the informal reports from DACS since the survey interviews were completed.
These findings are only as reliable as the information reported to the interviewers at the time of the survey. These figures do not represent in any fashion an audited record in accounting terms, of any DAC finances. In most cases the profit/loss for 1982 considered projected revenue reductions, but did not always include expenditure reductions because, at the time of the interview, directors did not know where cuts might have to be made--if their budgets were to be reduced.
Program Per Diems. Respondents were asked to give both the per day per person
program reimbursement rate and the per day per person transportation rate. Table 4 lists the average program per diems (as well as the high and low rates, i.e., the range) for each type of combination of program (adult, school age, preschool, and infant), year (1980, 1981, and 1982), and location (in-center and homebound). Table 5 shows the corresponding transportation per diems.
Policy Analysis Paper #6January 11, 1982page 9Table 3Profit/Loss by Region and Statewide Total (Minnesota DACS: 1980, 1981, 1982; 100% reporting)
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Program Per Diems (continued)
The average statewide program per diem for adults was $21.00 (in-center) and $30.07 (homebound) during 1981. Also during 1981, the average statewide preschool per diem was $31.73 (in-center) and $29.72 (homebound). Adult per diems increased an average of 8.7 percent from 1980 to 1981 and will increase an- estimated 5.0 percent from 1981 to 1982. Preschool per diems on the other hand, showed a more dramatic percentage increase from 1980 to 1981 (9. 2%) but only a 2.9 percent increase for 1982.
Adult In-Center Pre-School In-Center
1980 $19.32 1980 $29.07
1981 ;;;. ;; 1981 $31.73
1982 . 1982 $32.65
Transportation Per Diems. Transportation per diem figures in Table 5 show that the statewide average adult (in-center) rate for 1981 was $4.33, while the statewide average pre-school (incenter) rate for 1981 was $6.19. The statewide average increase in adult transportation per diems was 5.6% from 1980 to 1981 and a projected -4.9% from 1981 to 1982.
Adult Transportation Preschool Transportation
1980 $4.10 1980 $5.56
1981 $4.33 1981 $6.19
1982 $4.12 1982 $5.95
The reader is referred to Table 5 for the remainder of the rates.
Capital Assets (Building). Table 6 presents capital asset expenditures by DACS. Included in Table 6 are expenditures for building rent, purchases of existing buildings, and new facility construction. These figures are difficult to derive because of donations and contributions of capital assets. The figures show actual cash outlays for capital assets at the time of purchase; they do not indicate present salable value.
Building rent (Table 6A) totaled $1.2 million statewide in calendar year 1981 for 66 facilities. The average rent was $17,500. Table 6B indicates total cost, loan payments and 1981 depreciation for those buildings which were purchased. Thirty-five (35) DACS reported that they had purchased buildings. The total statewide cost was $5.6 million; the average was $160,000 per facility. Of those 35 DACS, 22 reported making loan payments which totaled $267,000 in calendar year 1981; the average loan payment was $12,000. Twenty-nine (29) of the 35 DACS took depreciation on those buildings ($176,163 in calendar Year 1981) averaging $6,000 per agency.
Thirty-four (34) DACS reported new construction of a facility (Table 6C). The total was "$4. 2 mil lion; the average was $124,000. Ten (10) DACS reported making loan payments ($149,000 total in CY 1981); the average loan payment was $14,900. Twenty-three (23) of the 34 DACS were taking depreciation on those buildings. The total depreciation was $112,000 in 1981; the average was $4,900.
Policy Analysis Paper #6 January 11, 1982Page 14Policy Analysis Paper #6January 11, 1982Page 17 Table 6 Capital Assets (Buildings) by Region and Statewide Total(Minnesota DACS: 1981; 100% reporting) Policy Analysis Paper #6 January 11, 1982Page 18Capital Assets (Vehicles, Furniture, Equipment). Interviewers also asked the DACS to report capital assets such as motor vehicles or furniture and equipment. Table 7A shows that 65 DACS (61%) indicated that they had purchased one or more motor vehicles. Total cost statewide was $1.3 mill ion or $20,000 per DAC. Of those 65 agencies, 14 DACS made loan payments totaling $82,000 in calendar year 1981. The average loan payment was $5,900. Sixty (60) DACS reported taking depreciation on vehicle purchases. The statewide total was $250,000 or $4,200 per DAC.
The cost of capital assets such as furniture and equipment (Table 7B) was known by 86 DACS. The remaining 20 DACS indicated unknown cost or contributed furniture
and equipment. The 86 DACS' total cost for furniture and equipment was $1.7 million at the time of purchase. The average was $20,000 per DAC. Only one DAC indicated a loan payment in calendar year 1981 ($1 ,500). Depreciation was taken by 77 of the 86 DACS. The total amount was $145,000; the average was $1,886.
Building Accessibility. In the next several years, DACS are expected to serve more people with physical or multiple handicapping conditions. As a result of this expected trend buildings will have to be-accessible (both exterior and interior). Two questions were posed to DAC directors about accessibility. The first question assessed exterior accessibility with 72% of the 146 buildings reported to be accessible. The second question assessed interior accessibility: 58% of the buildings are totally accessible; 21% are partially accessible; and 21% are not accessible. Although the number of barrier free buildings is up from 46 reported in 1978, there are programmatic and fiscal ramifications of this finding. Admissions of individuals with mobility impairments will be delayed
Capacity. region and Welfare to and infant facility's until modifications are made in the DAC buildings; (See Table 8) Table 9 shows the licensed capacity of the State's DAC programs by statewide total. DACS are licensed by the Department of Public provide adult programs or preschool programs or both. Homebound programs are not licensed separately. DAC licenses indicate a client capacity, which is determined to a great extent by building specifications and staffing capabilities.
Six years ago there were 101 DACS in the State with a total licensed capacity of
3,867 (Research and Statistics Division, Minnesota Department of Public Welfare, 1976). The 106 DACS currently in operation reported a total licensed capacity
of 5,584 for 1981.
In 1980 the statewide licensed capacity of adult programs was 4,243; the statewide average was 42.4. The licensed capacity during 1981 was 4,436 (44.3 per DAC). DACS reported that they anticipate licensed capacity of their adult 1982 (a 4.4% increase over 1981).
The licensed capacity of the State's preschool DAC programs 1,092 in 1980. The licensed capacity was 1,148 during 1981 (a 5.1% increase over 1980) but is projected to decrease by about 2 percent in 1982, to a statewide licensed capacity of 1,123.
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Table 7
Capital Assets (Vehicles, Furniture & Equipment) by Region and Statewide Total
(Minnesota DACS: 1981; 100% reporting)
B. Furniture and Fixtures/Equipment
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Table 9 Licensed Capacity by Region and Statewide Total
Policy Analysis Paper #6 January 11, 1982Page 22Average Daily Attendance. DAC enrollment records have been maintained by the Minnesota Department of Public Welfare for several years. During program year 1972-1973, there were 754 preschool children, 303 school-age children, and 1,366 adults participating in Minnesota DAC programs. The average daily attendance for preschoolers during this three year period was 744 (1980), 729 (1981 ), and 730 (1982 projected). The average daily attendance for school-age children was 47 (1980), 53 (1981), and 50 (1982). This figure has been decreasing steadily since 1972 and the inception of the Trainable Mentally Retarded Law. Adult daily attendance has increased steadily since 1972 and is expected to reach 3,646 in 1982. Table 10 presents these figures by region and statewide
totals.
Iv. IMPLICATIONS
One of the most important implications of this study is to continue this data base in cooperation with the developmental achievement centers and the Minnesota Department of Public Welfare. The 1982 fiscal data presented in this report should be considered projections only and should be updated over the next fiscal year to accurately reflect federal, state, and local budget changes.
This paper is the first in a series of three to be produced on the status of Minnesota Developmental Achievement Centers. The full implications of the fiscal data will be considered in the upcoming reports on personnel/program and client characteristics and movement.
Policy Analysis Paper #6January 11, 1982Page 23Policy Analysis Paper #6 January 11, 1982Page 24Policy Analysis Paper #6 January 11, 1982Page 25V. REFERENCESBellamy, G., Homer, R. & Inman, D. Vocational habilitation of severely retarded adults: A direct service technology. Baltimore: University Park Press, 1979.
Bellamy, G., Sheehan, M., Homer, R., & Boles, S. Community programs for severely handicapped adults: An analysis. Journal of the Association for Severely Handicapped, 1980, (4), 307-324.
Bergman, A. A guide to establishing an activity center for mentally retarded persons. Washington: U.S. Government Printing Office, 1976.
Community Programs Division, Minnesota Department of Public Welfare. Final statistical data for FY '77. St. Paul: Author, 1977.
Community Programs Division, Minnesota Department of Public Welfare. DAC status report for July-l, 1978 - June 30, 1979 St. Paul: Author, 1978.
Community Programs Division, Minnesota Department of Public Welfare. DAC status report for July 1, 1979 - June 30, 1980. St. Paul: Author , 1979
Community Programs Division. Minnesota Department of Public Welfare. Unit costs for developmental achievement centers July 1 - December 31, 1979. St. Paul: Author, 1979.
Constantine, E. Internal DPW memorandum: 1978-1979 status report-developmental achievement center grant-in-aid. St. Paul: Department of Public Welfare, October 27, 1978.
Cortazzo, A. Activity centers for retarded adults. Washington, D.C.: President's Committee on Mental Retardation, 1972.
Demars, P. Training adult retardates for private enterprise. American Journal of Occupational Therapy. 1975, 29 (l), 24-25.
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DHEW Report on Deinstitutionalization. Task Force on Deinstitutionalization of
the Mentally Disabled. Decision memorandum. Washington, D.C.: Department of Health, Education and Welfare, Office of the Secretary, 1978.
Kaufman, B. Internal DPW memorandum: 1979-1980 status report-developmental
achievement centers. St. Paul: Department of Public Welfare, November 27, 1979.
Mental Retardation Program Division, Minnesota Department of Public Welfare.
An analysis of client and program characteristics in Minnesota developmental achievement centers. St. Paul: Author, 1978.
Policy Analysis Paper #6 January 11, 1982page 26Mental Retardation Program Division, Minnesota Department of Public Welfare.Internal working paper: Results of adult DAC phone survey. St. Paul: Author, 1981.Minnesota Developmental Achievement Center Association. DAC demographic data as of June 30, 1980. St. Paul: Author, 1980.Research and Statistics Division, Office of Evaluation, Minnesota Departmentof Public Welfare. Persons enrolled in daytime activity centers, December 31, 1975, a special report. St. Paul: Author, 1976.
Salmon, D. Training and jobs for the mentally handicapped. Industrial Education, 1975, 24-25.
Social Services Division, Monitoring and Reporting Section, Minnesota Department of Public Welfare. Trends in social services: April - June, 1979. St. Paul: Author, 1979.
Wehman, P. Vocational training of the severely retarded: Expectations and potentials. Rehabilitation Literature, 1976, 37 (8), 233-236.
The Policy Analysis Series is published by the Minnesota Governor's Planning Council on Developmental Disabilities and the Developmental Disabilities Program, Department of Energy, Planning, and Development.
Bruce Balow, Ph.D., Council Chair - Colleen Wieck, Ph.D., Director
The purpose of this series is to enhance communication among state and local agencies, service providers, advocates, and consumers on timely issues. We encourage reader participation by giving us feedback on your ideas and perceptions of this problem. This paper may be cited:
Developmental Disabilities Program. Policy Analysis Series #6: The Financial Status of Minnesota Developmental Achievement Centers: 1980-1982. St. Paul, MN: Developmental Disabilities Program, Department of Energy, Planning, and Development, January, 1982.
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Policy Analysis Paper #6January 11, 1982Page 27APPENDIX-. Minnesota Economic Development Reg------T -------- - tloocJilc141MGJ ---- I I3ions
