Orleans-Niagara BOCES still doesn’t have the cost of Project SASH covered.

The BOCES board of trustees’ vote nearly a year ago to phase out its program for disabled preschoolers remains difficult but warranted, according to Superintendent Clark Godshall. Payments by the state for service are so far behind, BOCES’ potential loss now stands at $3.2 million. By law, BOCES is not supposed to run a deficit and it cannot recover the money elsewhere.

While the grassroots Save Our SASH Coalition works political and popular avenues to prod the state and rescue SASH, the proverbial handwriting on the wall is hard to miss.

“We’re about the last BOCES in the state doing SASH,” Godshall said. “Our program is one of the highest cost programs in the state. Other institutions can do it cheaper.”

For decades, SASH — which stands for Seek and Serve the Handicapped — has provided school-based instruction and therapeutic services for 3- to 5-year olds in Niagara and Orleans counties. Over the 10-year period 1993 to 2003, annual enrollment ranged from about 70 to 100 students. The current cost is about $2 million a year, Godshall said.

SASH’s financial problem stems from the method by which New York State funds preschool special education. Preschool costs are shared by the state and counties but providers run programs without knowing for certain how much money the government is going to give them. The state education department and budget division approve a program’s per-child tuition rate about two years after the money’s been spent; if the program spends more than the approved rate, it comes up short.

For SASH, public employee wages and benefits drive the cost well above what other providers are spending. BOCES has filed rate appeals — requests for higher tuition reimbursement — annually for the past 20 years, according to Godshall. The appeals were successful until the past few years, when the state began to struggle financially.

BOCES uses federal funds and grants to cover the cost of SASH upfront, then waits for state reimbursement, SASH coordinator Sue Bielawski said. Without higher, more timely reimbursements, a cash flow problem is growing more severe.

“BOCES has been keeping us afloat while the rates are appealed,” she said. “They can’t keep subsidizing us if our rate isn’t going to increase.”

Two bills pending in the state Legislature seek to address the funding problem for special education preschool providers generally. A Senate bill co-sponsored by George Maziarz, R-Newfane, and an Assembly companion piece co-sponsored by Francine DelMonte, D-Niagara Falls, would require multi-year tuition rates based on a first-year determination of actual cost plus cost-of-living increases, so providers know what they have to work with, and speed up the tuition reconciliation process between schools, state education and the state budget division.

The bills also would allow the programs to maintain a cash surplus of up to 2 percent to cover contingencies; surpluses are not allowed now.

Overall, DelMonte and Maziarz said, the legislation would bring SASH more money and assure the longer-term financial stability BOCES needs in order to continue the program.

The Legislature approved a similar act several years ago, but it was vetoed by Gov. George Pataki. His veto message said the act would reduce the state’s rate setting power and encourage greater spending instead of reform.

Directors of private, not-for-profit agencies pressed to fill in gaps being left by SASH say BOCES isn’t the only preschool provider hurt by the state’s complicated funding method, though. While staff costs are lower for private agencies, the two-year lag in payments and the uncertainty about rates from year to year cause them problems as well.

Niagara Cerebral Palsy operates Niagara Children’s Education Training Center and deputy director John Reardon observes “the state is not keeping up with costs generally. If reimbursement doesn’t keep up with costs, we all fall further behind.”

Budgeting is a matter of “best guessing” for preschool providers, Michael Gross, director of the Erie County ARC/Heritage Centers, said. Like other providers, Heritage is paid a rate today that was established in 2004, with a 2 percent overage allowance. If it spends more, it can appeal for a better rate or eat the cost; if it spends less, its next rate will be cut to that lower amount despite cost of living increases. There is no stability in the funding and no incentive to cut costs without being penalized.

“It’s a very difficult way to run a business,” Gross said.

Not-for-profits like the Arc of Orleans’ Rainbow Preschool, end up losing money consistently, Theresa Lehman, director of educational and clinical services for the Orleans and Wayne County Arcs, said. Not-for-profits generally end up taking on the most difficult, costly preschool cases when profit-oriented private programs exercise the option not to deal with them.

“We’re seeing the collapse of the system because the rates are so poor,” Lehman said. “We have bake sales, garage sales, to raise money. We tap into the (ARC) Foundation (to absorb losses).”

Since the SASH phaseout was announced, Rainbow Preschool has been lobbied by area school districts to explore opening new classrooms to handle students who would have gone to SASH, Lehman said. It’s difficult to refuse, she added, since the ARC mission is to serve people with disabilities, but the financing makes it difficult.

The Senate and Assembly bills will probably come up for consideration by the Legislature in the spring, during budget negotiations, Maziarz said.

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