The real-life impact of the budget impasse
It was embarrassing enough Pennsylvania went for nine months without a state budget, but we can take comfort – there’s always Illinois.
Lawmakers in the Land of Lincoln still haven’t been able to come to terms on a budget for the 2015-16 fiscal year, 12 months after they were supposed to strike a deal. With no agreement in sight, schools and colleges could start locking their doors and social services will be pared even more.
But before Pennsylvania starts crowing, the deadline for the 2016-17 budget is looming at the end of the month, and it would be a stunner if it’s signed by Gov. Tom Wolf on time. We also shouldn’t be too proud because a recent report outlined just how devastating the protracted budget impasse was for nonprofit agencies in the commonwealth, ranging from libraries and arts organizations to health and environmental groups.
According to the study prepared by Pennsylvania Association of Nonprofit Organizations, along with Greater Pittsburgh Nonprofit Partnership and United Way of Pennsylvania, more than 17,000 Pennsylvanians served by 22 organizations received no services or reduced services throughout the budget standoff. Then there were 90 organizations that had to find ways to compensate for $80 million that was supposed to come from Harrisburg, but was delayed or never arrived.
There are other grim numbers in the report: More than $170 million was collectively borrowed by 135 organizations to keep the lights on during the budget debacle, with half of it coming from cash reserves, 39 percent borrowed from lines of credit or banks, and 8 percent of vendors were just not paid in time – cash they essentially “borrowed” from them.
For good measure, 45 of the organizations surveyed incurred more than $500,000 in interest they will have to pay back, 18 percent said their credit rating took a hit and 88 programs reduced their hours of service or closed entirely.
The study also contains remarks from officials from nonprofit organizations that highlight how the budget standoff was more than just a particularly ignominous piece of political theater:
• “We held off relocating victims of domestic violence that we would have otherwise funded to relocate.”
• “Classes for 16-18 year-olds reading below the 6th grade level were cancelled for 60 days, ending services for 150 out-of-school youth trying to increase their reading levels to prepare for the GED and job training. …Several adults faced parole violations for not being able to prepare for the GED. … Over 200 new immigrants were forced out of English and citizenship classes.”
• “Our agency is weaker financially. Our bank is more cautious in loan decisions and is doing more review of our requests and business.”
Undoubtedly, the leaders of these organizatiions are girding themselves for more shenanigans at the state Capitol, with the possibility of more cuts, more workers not knowing from day to day whether they will be employed, more needs left unmet and more lines of credit drained.
There are actual lives affected by the political gamesmanship in Harrisburg. Lawmakers should digest this report, and maybe they will move a little more expeditiously in the weeks ahead.