BRATTLEBORO — Local nonprofits receiving federal funds are reviewing their budgets in response to the federal sequester, saying what started as an across-the-board 5 percent spending cut could thrust greater numbers into poverty.
Steve Geller, executive director of Southern Vermont Community Action (SEVCA), said local organizations such as SEVCA “catch people in the nick of time” before they become homeless.
Cutting services for people in poverty promotes unnecessary suffering and costs taxpayers more money over time, said Geller, who called the sequester cuts “incredibly shortsighted.”
“They're [Congress] looking at the silo and not the whole sequence of consequences,” he said of the sequester's potential long-term effects.
According to Geller, SEVCA has received word the federal funding it receives for Head Start - a federal block grant that supports emergency family outreach workers and emergency home repairs - will be cut.
Geller estimates that SEVCA stands to lose $100,000 over the sequester.
“We consider it a lot,” said Geller. “That hurts for us to have to say that.”
Not all of SEVCA's $7 million budget comes from federal sources. Still, the 5 percent cuts could translate into 100 to 200 households going without critical services.
Geller said the cuts are not huge in one area alone, but overall, “they erode our ability to provide quality services and meet demands.”
According to Geller, the community action agency is analyzing the budget cuts, their effect on services, and how the agency will respond.
With what information he has at this early stage, Geller estimates that, absent additional funds, some 35 to 50 families stand to go without emergency housing assistance this year. This program helps people in danger of eviction remain in place or move to another stable situation.
In Windsor County, which SEVCA also serves, the sequester could lead to the dismantling of one Head Start classroom serving 17 children, said Geller.
As the sequester's effects ripple, SEVCA faces reductions in outreach office hours, number of people served, number of staffers in the micro-business program, and other payroll.
The agency is trying to determine the best way to absorb the reductions while protecting the most services, Geller said.
In the previous fiscal year, SEVCA served 6,300 households in Windham and Windsor counties, or about 14,000 individuals.
The agency's services included emergency heating fuel, emergency housing, crisis resolution, continued disaster recovery services following Tropical Storm Irene, home weatherization, and tax preparation.
Worst to come?
Geller said his major concern is that these cuts might be the first volley in what he said he feared could be “a larger battle against the poor.”
The 5 percent sequester cuts follow in the footsteps of previous cuts or level-funding over several years, he said. Those dollars cover fewer services, while the cost of living only increases.
Not all the cuts will happen simultaneously, Geller said. The sequester cuts could span different fiscal years depending on how the federal government awarded the grants - some federal grants are awarded in chunks over two years, for example.
The 5 percent cuts, or the estimated $100,000, at SEVCA only pertain to federal fiscal year 2013, which runs October to September, Geller explained.
Geller said he fears that the cuts will continue ramping up in 2014. Head Start programs could see an 8 percent cut, for example.
“It's a snowball effect,” he said. “We're nervous about how each piece could feed off each other and create a bigger impact.”
Meanwhile, Geller said SEVCA saw a 15 percent increase in demand for services over the previous year as more people with jobs, including families with both parents working full- or part-time, had reached out for services.
That speaks to an increase in people's desperation in the wake of the 2008 recession, he said. People hold out less hope for finding jobs and opportunities.
More people stand on the edge of homelessness, he said. Meanwhile, the sequester will hit funding for homelessness prevention.
Geller said the situation is frustrating, as it costs less to prevent homelessness than to pull a family out of homelessness, where many lose the wind from their sails. “It's a better use of funds,” he said, adding that in his view the sequester is Congress' “colossal blunder.”
“Time will judge if this [sequester] is an anomaly or the new normal,” he said.
Geller has served more than eight years as executive director at SEVCA. Before that, he served 18 years at a Community Action agency in Portsmouth, N.H., and in Massachusetts before that.
He described funding in his long experience as cycling up and down, and that he wouldn't “hit the panic button yet,” but this year's fiscal stalemate strikes him as distressing and discouraging.
“But I'm always hopeful,” Geller said.
Innovation during tough times
The 29-bed Morningside Shelter, which receives a “significant amount” of funding from the federal Department of Housing and Urban Development, also faces a hit in October, at the start of the 2014 federal fiscal year, reports executive director Joshua Davis.
Morningside, founded in 1979, is the only homeless shelter in southeastern Vermont, and specializes in housing placement with ongoing staff support and life skills development for both families and individuals.
Davis has served as the shelter's executive director for a year and been affiliated with the organization more than three years. How the cuts will affect services there is unknown, Davis says. Morningside staff are in the middle of their budgeting process.
Davis is also watching the shelter's Emergency Solutions Grant (ESG), a state-administered grant funded with federal money that helps pay for the shelter's daily operating costs, including heating fuel.
Although the ESG is safe for now, Davis says he anticipates Morningside will feel a greater financial pinch later this year or early next.
Vermont previously kicked in extra money for social programs to cover shortfalls in federal funding, said Davis. The state, however, may tighten its belt too.
For example, he said, the legislature is considering a five-year cap on Reach Up, a Vermont Department for Children and Families program. Vermonters traditionally remain in this program as long as needed, according to Davis.
Under such a funding cap, proposed to take effect April 2014, 40 Windham County families would lose support immediately, Davis predicted. He said Morningside already averages a waiting list of 30 to 50 households.
Records show that this year, as of March 31, the shelter fielded requests for services from 114 households, and of those was able to serve 43 adults and 14 children.
Davis says he has seen a general trend of more young families seeking beds in the shelter. The bulk of the people walking through the door are unemployed or underemployed: People working at fast food restaurants or motels, for example, usually only work 20 hours a week. If they're full-time, they might pull in $9 an hour.
Davis says that according to data he's seen, $18 an hour is a more realistic living wage for Vermont.
“It just doesn't add up,” he said.
Organizations such as Morningside, the Brattleboro Housing Authority, and SEVCA are part of a system that helps people get back on their feet, said Davis.
Over the past three years that Davis has been affiliated with Morningside, however, he has seen the BHA's waiting list grow longer.
“People aren't moving,” he said.
Without jobs or other forms of financial support, Davis added, “people will cycle down, not up.”
Services in this area are already stretched thin, he said. To do more with less, Morningside has diversified its fundraising efforts. The shelter partners with other agencies to fill gaps.
Organizations must act efficiently with what resources they have and work together, he said. Getting out of organizational silos is difficult because nonprofits often operated at “a breakneck pace.”
One such innovative collaboration between Morningside and Youth Services, Inc., is the Youth Shelter Collaborative, which is geared toward sheltering homeless youth. Morningside leases a four-bedroom apartment in Brattleboro, while Youth Services provides a live-in residential manager.
The collaborative allows Morningside and Youth Services to create a shelter space for less than it takes the state to house people in hotels as a temporary shelter, Davis said.
Rural homelessness is harder to see compared to homelessness in urban areas, but it exists nonetheless, he said.
“It's hard to appreciate the number of people teetering on the edge,” Davis said.
Homelessness and poverty are community issues, he said: “What do we want to do about it?”