Nonprofits struggle under budget impasse
While the California Legislature seemingly refuses to pass a budget now eight weeks overdue, cash-strapped nonprofits are left hanging without state funding.
Some are even struggling to keep their doors open.
Many local nonprofits were operating on a shoestring in the first place, said Stephanie Snyder, Nevada County’s communications coordinator.
“Now you get something like this, which is just a killer for them,” she said.
Neighborhood Center for the Arts in Grass Valley, which hasn’t seen any state money since June 30, suspended operations this week for lack of funding.
Some 60 clients, relatives and teachers gathered at a “Songs of Support” rally in Grass Valley Friday to raise money for the nonprofit, which offers programs for people with various health and development issues.
About $2,000 was raised, reported Ellen Persa, the center’s executive director who, like her staff of 20, has been unemployed since Wednesday.
Parents and teachers who attended Friday’s rally wondered what will come next.
“This is terrible,” said Maureen Rumsey, whose daughter, Erin, 33, does ceramics at the center three times a week.
The center, Rumsey said, is one of the few places where the developmentally disabled are recognized for their artistic talents.
The teachers, perhaps because they are artists themselves, have the unique ability to connect with them, she said.
The center’s board of directors decided to close its doors Tuesday after Alta Regional of California – an agency contracted by the state to fund programs for the developmentally disabled – announced it was running out of money.
Because the Legislature didn’t pass its budget by July 1, the state is withholding payment to vendors and agencies that provide services under contract. That money eventually funnels down to local nonprofits, said Tim Snellings, the county’s director of intergovernmental affairs.
Snellings said the state’s budget deadlock is also affecting the flow of federal funds to nonprofits because a state match is often required before federal monies are released.
“Because state funds are now on hold, it’s also placing federal funds on hold, so that could be another reason that nonprofits are being hurt,” he said.
Snellings said the jury’s still out on when the state budget will pass.
“We and our nonprofit partners need it sooner instead of later,” he said.
While the Lutz Adult Day Health Care program in Grass Valley has more complex funding problems, Executive Director Bobby Swanson said the budget stalemate is taking a roundabout toll by way of dwindling enrollment.
The program is being impacted, she said, because funding for respite services provided by agencies under the Area 4 Agency on Aging umbrella is suspended.
“In absence of a signed budget, they cannot make those commitments so the number of people who can attend the program and the number of days they can attend have been reduced significantly,” Swanson said. “As a result, our average daily attendance is way down.”
Even though the Lutz program is not directly funded by Area 4, it’s being impacted by the umbrella agency’s lack of funding – which is a direct result of the budget impasse, Swanson said.
Due to significant financial loses, suffered in part because of the program’s reduced enrollment, it was announced Wednesday that the Lutz Center building is up for sale.
While the day health care program for the elderly and disabled will continue, Swanson said, the program’s board of directors will be looking hard for a new home and ways to make the program more viable.
Many of the hardest hit local nonprofits partner with the county’s Human Services and Housing and Community agencies to deliver critical services to low-income families, said Human Services Director Phyllis Murdock.
“We hope the legislature will pass a budget soon and not hold human services programs hostage to the budget process, so these nonprofit agencies can continue to help real people with real problems,” Murdock said.
Earlier this month, she said, the Board of Supervisors authorized the county’s executive officer to assist nonprofits requesting loans to tide them over until the state budget is signed.
Murdock said memorandums of understanding are being finalized with the High Noon Senior Meals program in Grass Valley, the Senior Meals program in Truckee and the Del-Oro Caregiver program in Grass Valley. Each will get $5,000 loans from the county next week, she said.
Murdock said, however, that the county can’t give loans to every nonprofit.
“But we certainly hope the budget is passed so the nonprofits can continue to deliver their services,” Murdock said. “In the meantime, we’ll do what we can to keep services alive.”
Republicans blame Democratic Gov. Gray Davis for the budget stalemate.
While the state senate approved a $99 billion state budget June 29, Assembly Republicans so far have refused to deliver the votes to pass Davis’ plan.
“If we sign the budget, we will have a $50 billion deficit over the next five years,” said Assemblyman Sam Aanestad (R-Grass Valley).
Davis has refused to negotiate, Aanestad said Wednesday, and state legislators do not have a budget to react to.
“Just because we say ‘no’ to a bad budget doesn’t make us the culprit,” he said.
Brett Michelin, Aanestad’s chief of staff, said Friday that Davis could issue an emergency declaration to get funds.
“The Republicans are urging the governor to take care of those who are being hurt by the delays now,” Michelin said. “(But) so far, Davis has been unwilling to do that.”
But Anita Gore, a spokeswoman for the state Department of Finance, said that would be too costly.
There are reductions in the proposed budget that would not take effect, she said.
It would also not be a clean way to do the budget, Gore added.
“Who decides what program du jour gets funded?” she asked. “The governor is opposed to a piecemeal approach to the budget.”
Gore said the governor has proposed a balanced budget, but the Assembly has refused to act on it and has not met its constitutional obligation.
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