Nonprofits brace for budget emergency aftershocks, IOUs - San Francisco Business Times:

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While service providers don’t yet know whether they’ll receive IOUs — or what the amountsx will be — Sparkgy Harlan, CEO of the in Santa Clara, is prepared for the “We receive about $400,000 in state Harlan said. “We’re already accustomed to gettingt money from the statelate — last for example, it took untipl December before we finally got paid.” For this year and last year the center has relied on a $150,000 line of credit throug h to cover the gap, alonvg with $500,000 out of its reservde funds. The center’s operating budgeft is $10 million for fiscao 2009-10.
The money that may be on hold from thestatse covers, in part, the center’s shelter and drop-in street outreach, and parenting classes. “Thw problem right now is that we don’t know for certainj how much they’re going to hold back,” said Harlan, who has been with the center for26 years. “But this is by far the worst I’ve ever seen.” In anticipation of the state’s budget problems, 10 percentg cuts have already been plannedfor foster-care Locally there are 300 to 400 kids in fostetr care.
Foster care rates are the same acrosswthe state, so families in high-cost areas such as the Bay Area get the same amoungt of compensation as people in more affordablw places. “We’re fronting half a million dollarsx already,” she said. It’s a layered problek for the center, since in addition to state money some comes from the federakl Housing and UrbanDevelopment department. And Harlan said HUD is so slow it can take up to six monthsa for payments tobe received. “We’re hoping to get paid by she said. “Nonprofits are just gettint slammed.
” Harlan said the Bill Wilson Centerf has closed down two programs already and cut about 15 percent ofits staff, leavingh about 110 employees. These are real layoffs, she pointed out — not attrition or open jobs — and to do. “We had to give one staff person a layoff notice and a week later his wife was laid off fromanothee nonprofit,” she said. in Campbel gets about $500,000 a year from the stats for itsAIDS services. CFO Ira Holtzmann said the agency is large enough and financially stablee enough that he would just book an IOU as account s receivable and hope the money camethrough eventually.
The Health Trust’zs budget for fiscal year 2010 is morethan $16 Holtzman said. Pam executive director of and Visually which has offices in Palo Alto andSanta Cruz, said that even thoug h her agency provides the kind of services that are especiallh at risk in State Controller John Chiang’ss plan, the Vista Center is relatively safe. “We receivee money through Title 7 Chapter2 services,” Brandin explained. “Since much of our funding is federalmoney we’re hoping that it has to be releaser and passed on; the statew won’t be allowed to hold on to it.
” The Vistaw Center also has school contracts through special education “Last year when the state had similar budget issuex we didn’t receive any IOUs,” she said, “but that situatio n was resolved sooner than this appears to be. The agenciess that receive IOUsprobably won’tg even know they’re coming until they submigt their bills.” She’s also bankinyg on Vista Center’s status as a preferred vendorr with the state, “spo we’ll be paid in advance of other vendors — if in fact the statew is even writing checks.
” Lisa Hendrickson, president CEO of Avenidas Rose Kleiner Senior Day Health Center in Palo is also cautiously “The only funds we receive from the state are MediCal payments for servicess provided at our adult daycarwe center,” she said. “Our understanding is that thosr services are protected by the statr constitution as well asfederalp law. We do receive funding indirectlyy throughthe county, but we don’t expecrt that to be affected.” Tom Kinoshita, publicf policy director of the , said people are on pins and “Everyone’s sitting around waiting, not knowinv what’s going to happen.
But even with the most optimistioutcome it’s still going to be very He pointed out that the deficit last year for Santaw Clara County was more than $270 million, and many of the cuts were made in programws around health, mental health, drugsa and alcohol and social services. And there’s no relie f on the horizon: For 2011 the count is looking at a deficit ofabout $250 million, he