About 300 representatives and supporters of social-service agencies throughout the region gathered Wednesday for a rally to end the state budget impasse.
The Southeast Pennsylvania Coalition for Essential Services staged the event outside the courthouse in Media to demonstrate to Pennsylvania’s elected officials the wide-ranging impact the ongoing budget stalemate is having on the state’s most vulnerable residents. The event also was used to draw attention to the need for expanded funding for social-services agencies in the proposed budget, which is slated to reduce state funding for HIV/AIDS causes by 25 percent.
The coalition, which formed last week, represents more than 60 nonprofits throughout the state.
Speakers at the event included Pennsylvania Rep. Curtis Thomas (D-181st Dist.); David Fair, openly gay senior vice president for Community Impact at United Way of Southeastern Pennsylvania; David Ross, public-policy officer director at the Pennsylvania Association of Nonprofit Organizations; Michael Chitwood, superintendent of police in Upper Darby; and Joyce Sacco, director of operations at Housing Alliance Pennsylvania.
The state is now nearly two months past its budget deadline, and in July, Mayor Nutter announced the city would stop paying its vendors until the state legislature approved its budget. Many social-service agencies in Philadelphia, however, receive a combination of city, state and federal funding, much of which is filtered throughout the city and has been halted because of the impasse.
The AIDS Law Project of Pennsylvania recently had a “six-day interruption” of its payroll, as it searched for funding to pay its employees, said Ronda Goldfein, the group’s executive director.
Goldfein said the agency received an anonymous loan, advanced payment from some creditors and a foundation grant, and was eventually able to issue the checks; the organization garnered enough funding to pay its employees through the end of October.
But the AIDS Law Project has had to halt funding to most of its vendors to save costs.
“We thankfully have a landlord who understands and a printer who understands and a lot of other people who know what we’re all going through,” Goldfein said, noting the agency is still paying its phone service and insurance provider.
Matt Teter, executive director of Calcutta House, who called Wednesday’s rally a “huge success,” said his agency has almost maxed out its line of credit and will be able to meet its next payroll, which is next week, but he was unsure about future paychecks. Teter noted that even if the impasse is resolved soon, he’s not certain how long it will take for the funding to be restored.
Calcutta House announced last month that it too would have to delay payments to its vendors until the budget is finalized and the city commences payment again.
Teter said the organization has been able to continue to pay some of its vendors, as it receives some funding directly from the federal Department of Housing and Urban Development, but he said the “vast majority” of the agency’s money comes through the city and state.
Kevin Burns, executive director of ActionAIDS — which is currently owed $500,000 in federal contracts — had to return to the agency’s office after the rally to lay off three employees.
“This has really been a struggle for us,” Burns said. “But at least if we lay people off, they can collect unemployment. We tried to look at positions that would minimize the impact on our clients, but it’s still going to be very hard.”
The organization has enough funding to pay its employees through the first week of September, but Burns was unsure if it could meet payroll after that.
He said the organization has also halted payments to vendors and requested a 90-day grace period, and has extended, but nearly depleted, its line of credit.
He predicted the organization will feel the effects of the impasse for quite some time.
“We’re going to be having to pay interest on the line of credit that we hadn’t budgeted for,” Burns said. “So I don’t know if there are going to have to be more than these three that we have to layoff, and if we’ll be able to bring them back or not. This is going to have a real impact on us for several years.”
Fair said he hopes the rally — which was populated by individuals from the HIV/AIDS community, women, minorities, children and the disabled — demonstrated to the state’s elected officials who is bearing the brunt of the impasse.
“This wasn’t about sloganeering or an emotional appeal; this was people talking about the real-life impact of the decisions that these guys have to make,” Fair said. “My hope is that they’ll remember that there is something more important than politics and egos.”
UWSEPA recently conducted a survey of more than 500 local social-service agencies to determine how the impasse has affected them, and found that the local HIV/AIDS service organizations are not alone.
About 31 percent of the agencies responded that they had no source of emergency funding, while 32 percent were tapping into their lines of credit and 56 percent were relying on their savings and reserves to tide them through until funding is restored.
“We’re not talking about a problem that will happen if they don’t pass a budget soon but this is a problem that’s already happening,” Fair said. “What they’ve done by delaying passing the budget and not being clear about how much funding they’ll be providing for health and social-service agencies when it is resolved undermines the system of nonprofits in the region.”
Nearly 32 percent of respondents said the delay in payments has forced them to reduce or eliminate their services, 31 percent responded they anticipated having to do so before the end of September and another 27 percent foresaw a cut in services within the next two or three months.
Approximately 27 percent of the agencies have implemented layoffs to reduce costs, while 20 percent intend to do so in the next few months.
Half of the agencies surveyed have had to delay vendor payments for supplies, maintenance, communications and utilities.
Jen Colletta can be reached at [email protected].