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</o:shapelayout></xml><![endif]--></head><body lang=EN-US link="#467886" vlink="#96607D" style='word-wrap:break-word'><div class=WordSection1><p class=MsoNormal><span style='mso-fareast-language:EN-US'>Good morning, Federationists and Friends:<o:p></o:p></span></p><p class=MsoNormal><span style='mso-fareast-language:EN-US'><o:p> </o:p></span></p><p class=MsoNormal><span style='mso-fareast-language:EN-US'>Something to share from Kentucky Office of Vocational and Rehabilitation Services Executive Director, Cora McNabb.<o:p></o:p></span></p><p class=MsoNormal><span style='mso-fareast-language:EN-US'><o:p> </o:p></span></p><p class=MsoNormal><span style='mso-fareast-language:EN-US'>Respectfully,<o:p></o:p></span></p><p class=MsoNormal><span style='mso-fareast-language:EN-US'><o:p> </o:p></span></p><p class=MsoNormal><span style='mso-fareast-language:EN-US'>Todd<o:p></o:p></span></p><p class=MsoNormal><span style='mso-fareast-language:EN-US'><o:p> </o:p></span></p><div><div style='border:none;border-top:solid #E1E1E1 1.0pt;padding:3.0pt 0in 0in 0in'><p class=MsoNormal><b><span style='font-family:"Calibri",sans-serif;mso-ligatures:none'>From:</span></b><span style='font-family:"Calibri",sans-serif;mso-ligatures:none'> McDaniel, Brooke N (ELC) <brooke.mcdaniel@ky.gov> <br><b>Sent:</b> Thursday, June 12, 2025 9:18 AM<br><b>Subject:</b> FW: Overview of the current proposed budget impacts<br><b>Importance:</b> High<o:p></o:p></span></p></div></div><p class=MsoNormal><o:p> </o:p></p><p class=Default><i><span style='font-family:"Aptos",sans-serif;color:windowtext'>SCVR Council Members, <o:p></o:p></span></i></p><p class=Default><i><span style='font-family:"Aptos",sans-serif;color:windowtext'><o:p> </o:p></span></i></p><p class=Default><i><span style='font-family:"Aptos",sans-serif;color:windowtext'>Please see the below information, sent on behalf of Cora McNabb. <o:p></o:p></span></i></p><p class=Default><i><span style='font-size:11.0pt;font-family:"Aptos",sans-serif;color:windowtext'><o:p> </o:p></span></i></p><div class=MsoNormal align=center style='text-align:center;text-autospace:none'><i><hr size=2 width="100%" align=center></i></div><p class=Default><span style='font-size:14.0pt;font-family:"Aptos",sans-serif;color:windowtext'><o:p> </o:p></span></p><p class=Default><span style='font-size:18.0pt'>Department of Education </span><span style='font-size:18.0pt;color:windowtext'>Proposed </span><span style='font-size:18.0pt'>Budget impacts on VR<o:p></o:p></span></p><p class=Default><span style='color:windowtext'><o:p> </o:p></span></p><p class=Default><span style='color:windowtext'><o:p> </o:p></span></p><p class=Default><span style='font-size:14.0pt;color:windowtext'>● CHIMP and Budget Proposal Create a De Facto Unfunded Mandate on States: <o:p></o:p></span></p><p class=Default><span style='font-size:14.0pt;color:windowtext'>The CHIMP (Changes in Mandatory Programs) mechanism has never been applied to the VR program, introducing new uncertainty. At the same time, the President’s budget proposal zeroes out key discretionary funding streams that support the VR system, including: <o:p></o:p></span></p><p class=Default><span style='font-size:14.0pt;color:windowtext'><o:p> </o:p></span></p><p class=Default><span style='font-size:14.0pt;color:windowtext'>● Training funds critical to building and sustaining the VR workforce pipeline <o:p></o:p></span></p><p class=Default><span style='font-size:14.0pt;color:windowtext'>● Supported Employment (SE) grants <o:p></o:p></span></p><p class=Default><span style='font-size:14.0pt;color:windowtext'>● Client Assistance Program (CAP) funds <o:p></o:p></span></p><p class=Default><span style='font-size:14.0pt;color:windowtext'>● Technical Assistance (TA) centers <o:p></o:p></span></p><p class=Default><span style='font-size:14.0pt;color:windowtext'><o:p> </o:p></span></p><p class=Default><b><span style='font-size:14.0pt;color:windowtext'>Eliminating these core supports shifts the burden to states without providing the necessary federal resources—effectively creating an unfunded mandate that jeopardizes service delivery, staff development, and client outcomes. </span></b><span style='font-size:14.0pt;color:windowtext'><o:p></o:p></span></p><p class=Default><b><span style='font-size:14.0pt;color:windowtext'>● Returning to FY24 Funding = A Major Step Backward </span></b><span style='font-size:14.0pt;color:windowtext'><o:p></o:p></span></p><p class=Default><span style='font-size:14.0pt;color:windowtext'><o:p> </o:p></span></p><p class=Default><span style='font-size:14.0pt;color:windowtext'>Reverting to FY24 funding levels would <b>severely compromise </b>the ability of VR programs to meet the needs of individuals with disabilities. The <b>increase in FY25 </b>was not an overage or surplus—it was a <b>critical catch-up investment </b>that allowed programs to begin stabilizing after flat funding and rising costs. <o:p></o:p></span></p><p class=Default><span style='font-size:14.0pt;color:windowtext'>However, due to the <b>late timing of the COLA increase</b>, most states were unable to adjust their general fund requests in time to fully leverage the federal increase. State legislative calendars had already closed budget negotiations, meaning <b>VR programs were left with federal funds they couldn’t fully match</b>—not because of lack of effort, but because of systemic timing constraints. <o:p></o:p></span></p><p class=Default><span style='font-size:14.0pt;color:windowtext'>The FY25 increase helped programs contend with: <o:p></o:p></span></p><p class=Default><span style='font-size:14.0pt;color:windowtext'><o:p> </o:p></span></p><p class=Default><span style='font-size:14.0pt;color:windowtext'>● <b>Rapidly rising operational costs </b>– including leases, insurance, salaries, and technology infrastructure <o:p></o:p></span></p><p class=Default><span style='font-size:14.0pt;color:windowtext'><o:p> </o:p></span></p><p class=Default style='page-break-before:always'><span style='font-size:14.0pt;color:windowtext'><o:p> </o:p></span></p><p class=Default><span style='font-size:14.0pt;color:windowtext'>● <b>A significant post-pandemic increase in service demand</b>, as more individuals seek employment and vocational support <o:p></o:p></span></p><p class=Default><span style='font-size:14.0pt;color:windowtext'>● <b>Clients with more complex and resource-intensive needs</b>, driving up per-case service costs <o:p></o:p></span></p><p class=Default><span style='font-size:14.0pt;color:windowtext'><o:p> </o:p></span></p><p class=Default><span style='font-size:14.0pt;color:windowtext'>Failing to sustain this increased funding level—and reverting to FY24—would erase hard-won progress, worsen service gaps, and leave programs unable to meet current demand. <o:p></o:p></span></p><p class=Default><span style='font-size:14.0pt;color:windowtext'><o:p> </o:p></span></p><p class=Default><span style='font-size:14.0pt;color:windowtext'>● <b>Flawed Assumptions on “Unused Funds”: </b>The argument that FY24 funding levels are sufficient because of unclaimed funds from past years ignores the COVID-era context. During the pandemic:<o:p></o:p></span></p><p class=Default><span style='font-size:14.0pt;color:windowtext'>○ Staff shortages limited service capacity <o:p></o:p></span></p><p class=Default><span style='font-size:14.0pt;color:windowtext'>○ Customers delayed services due to health risks <o:p></o:p></span></p><p class=Default><span style='font-size:14.0pt;color:windowtext'>○ These two largest cost drivers—personnel and service expenditures—dropped temporarily <o:p></o:p></span></p><p class=Default><span style='font-size:14.0pt;color:windowtext'>Today, both are rebounding significantly, and funding needs have outpaced pre-pandemic norms. <o:p></o:p></span></p><p class=Default><span style='font-size:14.0pt;color:windowtext'><o:p> </o:p></span></p><p class=Default><b><span style='font-size:14.0pt;color:windowtext'>Extending Match Timeframes Doesn’t Solve the Problem: </span></b><span style='font-size:14.0pt;color:windowtext'><o:p></o:p></span></p><p class=MsoNormal><span style='font-size:14.0pt'><o:p> </o:p></span></p><p class=MsoNormal><span style='font-size:14.0pt'>Allowing longer timeframes to meet state match requirements only delays the issue. Many states rely on the next fiscal year’s appropriations to meet their federal match, so without sustained funding increases, the challenge compounds over time.<o:p></o:p></span></p><p class=MsoNormal><span style='font-size:14.0pt'><o:p> </o:p></span></p><p class=MsoNormal><span style='font-size:12.0pt;font-family:"Arial",sans-serif;color:black;mso-ligatures:none'>Cora McNabb</span><span style='font-family:"Calibri",sans-serif;mso-ligatures:none'><o:p></o:p></span></p><p class=MsoNormal><span style='font-size:12.0pt;font-family:"Arial",sans-serif;color:black;mso-ligatures:none'>Executive Director</span><span style='font-family:"Calibri",sans-serif;mso-ligatures:none'><o:p></o:p></span></p><p class=MsoNormal><span style='font-size:12.0pt;font-family:"Arial",sans-serif;color:black;mso-ligatures:none'>Office of Vocational Rehabilitation</span><span style='font-family:"Calibri",sans-serif;mso-ligatures:none'><o:p></o:p></span></p><p class=MsoNormal><span style='font-size:12.0pt;font-family:"Arial",sans-serif;color:black;mso-ligatures:none'>Mayo-Underwood Building</span><span style='font-family:"Calibri",sans-serif;mso-ligatures:none'><o:p></o:p></span></p><p class=MsoNormal><span style='font-size:12.0pt;font-family:"Arial",sans-serif;color:black;mso-ligatures:none'>500 Mero Street</span><span style='font-family:"Calibri",sans-serif;mso-ligatures:none'><o:p></o:p></span></p><p class=MsoNormal><span style='font-size:12.0pt;font-family:"Arial",sans-serif;color:black;mso-ligatures:none'>Frankfort, KY 40601</span><span style='font-family:"Calibri",sans-serif;mso-ligatures:none'><o:p></o:p></span></p><p class=MsoNormal><span style='font-size:12.0pt;font-family:"Arial",sans-serif;color:black;mso-ligatures:none'>Phone (502) 782-3402</span><span style='font-family:"Calibri",sans-serif;mso-ligatures:none'><o:p></o:p></span></p><p class=MsoNormal><span style='font-size:12.0pt;font-family:"Arial",sans-serif;color:black;mso-ligatures:none'>Fax (502) 564-6745</span><span style='font-family:"Calibri",sans-serif;mso-ligatures:none'><o:p></o:p></span></p><p class=MsoNormal><u><span style='font-size:12.0pt;font-family:"Arial",sans-serif;color:black;mso-ligatures:none'><a href="mailto:cora.mcnabb@ky.gov"><span style='color:black'>cora.mcnabb@ky.gov</span></a></span></u><span style='font-family:"Calibri",sans-serif;mso-ligatures:none'><o:p></o:p></span></p><p class=MsoNormal style='mso-margin-top-alt:auto;mso-margin-bottom-alt:auto;line-height:20.4pt;background:white'><span style='font-size:18.0pt;font-family:"neo sans std bold";color:#333333'>Coming Soon--New Case Management System for the Kentucky Office of Vocational Rehabilitation</span><span style='font-size:12.0pt;font-family:"Arial",sans-serif;color:#333333'><o:p></o:p></span></p><p class=MsoNormal style='mso-margin-top-alt:auto;mso-margin-bottom-alt:auto;line-height:20.4pt;background:white'><span style='font-size:12.0pt;font-family:"Arial",sans-serif;color:#333333'>In the coming months, the Kentucky Office of Vocational Rehabilitation will transition to a new case management system. This new, more modern system will create greater efficiencies in services when full implementation is completed. To prepare for this transition, OVR agency staff will be working diligently to get case files in the current system ready for transfer to the new system. Staff also will undergo intensive training required for the new system. All these items will temporarily impact staff schedules and may increase the wait time for appointments or require rescheduling of existing appointments. OVR appreciates your patience during this hectic time of transition to the new case management system and will do all it can to minimize its impact on our services.<o:p></o:p></span></p><p class=MsoNormal><o:p> </o:p></p></div></body></html>