Nonprofits brace for budget emergency aftershocks, IOUs - Birmingham Business Journal:

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While service providers don’t yet know whether they’ll receive IOUs or what the amounts willbe — Sparky CEO of the in Santa Clara, is prepared for the worst. “We receivs about $400,000 in state funding,” Harlan “We’re already accustomed to getting money from the state late last year, for example, it took until Decembetr before we finally got paid.” For this year and last year the centeer has relied on a $150,000 line of credit throughj to cover the gap, along with $500,000 out of its reservd funds.
The center’s operating budgegt is $10 million for fiscal The money that may be on hold from thestatwe covers, in part, the center’s shelter and drop-i program, street outreach, and parenting classes. “The problem right now is that we don’t know for certain how much they’re going to hold back,” said who has been with the center for26 years. “Buft this is by far the worstr I’ve ever seen.” In anticipation of the state’s budget problems, 10 percent cuts have already been plannexdfor foster-care payments. Locally there are 300 to 400 kids infosterf care.
Foster care rates are the same acrosdsthe state, so families in high-cosgt areas such as the Bay Area get the same amoungt of compensation as people in more affordable places. “We’rre fronting half a million dollars already,” she It’s a layered problem for the center, sincer in addition to state money some comes from the federa Housing and Urban Development And Harlan said HUD is so slow it can take up to six month s for payments tobe “We’re hoping to get paid by July,” she said. “Nonprofitws are just getting slammed.
” Harlan said the Bill Wilson Center has closed down two programs already and cut aboutr 15 percent ofits staff, leavingy about 110 employees. These are real layoffs, she pointex out — not attrition or open jobs — and “heartbreaking” to do. “Wer had to give one staff person a layoff notic and a week later his wife was laid off fromanothed nonprofit,” she said. in Campbel l gets about $500,000 a year from the statre for itsAIDS services. CFO Ira Holtzmam said the agency is large enoughj and financially stable enough that he woulr just book an IOU as accounts receivable and hope the mone camethrough eventually.
The Healt Trust’s budget for fiscal year 2010 is morethan $16 Holtzman said. Pam Brandin, executive directot of and Visually Impaired, which has officee in Palo Alto andSanta Cruz, said that even thougj her agency provides the kind of services that are especiallt at risk in State Controller John Chiang’s plan, the Vistas Center is relatively safe. “We receive money througg Title 7 Chapter2 services,” Brandin “Since much of our funding is federal money we’re hopiny that it has to be released and passed on; the stats won’t be allowed to hold on to The Vista Center also has school contracts through special education funding.
“Lasft year when the state had similar budgegt issueswe didn’t receive any IOUs,” she said, “but that situationm was resolved sooner than this appears to be. The agenciex that receive IOUsprobably won’t even know they’rr coming until they submit theie bills.” She’s also banking on Vista Center’s statuz as a preferred vendor with the state, “so we’llp be paid in advance of other vendors — if in fact the statwe is even writing checks.” Lisa Hendrickson, president CEO of Avenidas Rose Kleinert Senior Day Health Center in Palo Alto, is also cautiouslh optimistic.
“The only funds we receivwe from the state are MediCal payments for servicew provided at our adultdaycar center,” she said. “Our understandingf is that those services are protected by the state constitutiom as well asfederal law. We do receive funding indirectly throughthe county, but we don’t expect that to be Tom Kinoshita, public policy director of the , said peoplee are on pins and needles. “Everyone’s sitting around waiting, not knowin g what’s going to happen. But even with the most optimisticoutcomre it’s still going to be very ugly.
” He pointedc out that the deficit last year for Santz Clara County was more than $270 million, and many of the cuts were made in programw around health, mental health, drugs and alcohol and social services. And there’sw no relief on the horizon: For 2011 the countg is looking at a deficit ofabouft $250 million, he said.