The Pittsburgh Foundation

Community leaders call for end to state budget impasse

Unified behind passage of Senate- and Governor-approved plan

PITTSBURGH, Dec. 11, 2015 – Leaders from across the Pittsburgh region’s business, religious, cultural, nonprofit and foundation sectors today decried the harm done to the state’s most vulnerable residents and many facets of its economy due to a nearly six-month stall in the passage of Pennsylvania’s budget.

In addition, they called for immediate passage of the spending plan negotiated and agreed to by the governor and Legislative leaders, which was approved by an overwhelming majority of the state Senate earlier this week.

“Catholic Charities is among scores of faith-based agencies in our region on the front lines of delivering essential human services to those most in need,” said Bishop David Zubik, who leads the Catholic Diocese of Pittsburgh. “The unprecedented delay in passing a budget is making it more and more difficult for all of our faith-based organizations and beyond to continue their important work.” Elected officials must compromise, he said, and pass the negotiated budget agreement that begins to restore some of the cuts in human services from previous years.

The bishop and six other leaders—including John Lydon, CEO of Auberle and Chair of the Greater Pittsburgh Nonprofit Partnership, and representing affected private schools, The Reverend Thomas E. Johnson Jr., Head of School and Co-Founder of the Neighborhood Academy—made their pleas for immediate budget passage in a press event at the new facility for Community Human Services, a construction project that was nearly upended by the budget delay. The nonprofit provides housing, a community food pantry, mental health services and other assistance to 5,000 to 7,000 low-income residents each year in several communities.

The briefing for news organizations was hosted by the presidents of The Pittsburgh Foundation, United Way of Allegheny County and the Greater Pittsburgh Nonprofit Partnership.

Each speaker gave accountings of the delay’s damage on human services nonprofits and to people seeking their assistance. Among the programs and services cited were shelters and assistance to the homeless, mental health treatment and counseling for domestic abuse victims.

The cutoff of $765 million in county-managed human services funds has forced hundreds of neighborhood-based agencies to take out loans and lay off staff members. And many of these organizations still have not recovered from the significant cuts made amid the state’s response to the Great Recession.

Echoing Bishop Zubik’s call for compromise and quick passage of the negotiated budget, Cynthia Shapira, chair of the board of the United Jewish Federation in Pittsburgh, said elected officials must stop making human services organizations and the people they serve the first casualties in a budget war. “This is counter to the values that define us in Pittsburgh and certainly should define the values in Harrisburg,” she said. “Those who are most vulnerable should not be in the first wave to feel the pain of a funding cut-off.”

Peoples Natural Gas President and CEO Morgan O’Brien said thousands of nonprofit organizations in southwestern Pennsylvania and across the state have fragile budgets in the best of times, “but now they are forced to borrow money to keep their doors open. Every day in Pittsburgh and Allegheny County, there are new stories of cash-strapped nonprofits forced to take on debt and cut back on their missions as the budget impasse continues,” said O’Brien, a former United Way board member and incoming Pittsburgh Foundation Board member. “We need to have a budget in place immediately – and there must be some type of provision to assist nonprofits with interest payments on loans they’ve taken on.”

Laura Ellsworth, partner-in-charge at the Pittsburgh offices of Jones Day law firm and chair of many civic and non-profit boards in the community, said taking out loans to withstand the budget stall is only a temporary option. “These organizations are running out of capacity to borrow funds, and critical services will be completely shut down, causing massive harm to people who need life-saving assistance.”

Emergency borrowing also extends to county governments across the state that provide much-needed services. In Westmoreland County, for example, commissioners may have to borrow up to $10 million to keep the government open. Several of the county’s senior citizen’s centers have already closed and the library system will be out of operating funds by January.

At Community Human Services, the cut-off of state funds has forced the organization to turn away 50 to 200 people daily from its housing intake center since November. “We couldn't keep up with the original demand and, since so many agencies have had to reduce services, we were seeing more people than before. In early November, a woman came in with her children. She had been told to go to six other places for help. One agency after the other turned her away and told to come here. She spent the last of her resources to run around the city being told we can't help. That is monstrous,” said Chief Executive Officer Adrienne Walnoha.

Standing in a nearly completed facility on Liberty Avenue, she told reporters that the project – the culmination of years of careful planning and saving – was nearly upended due to the budget delay. The agency had full funding to purchase the building but redirected those resources to client service. “But because of the state budget impasse, we had to finance an additional $1.5 million dollars, costing us additional interest funds and jeopardizing future expansion plans,” she said.

 Other examples of damage inflicted from the budget impasse include:

  • Threatened closure of the Neighborhood Academy, a faith-based, college preparatory school dedicated to breaking the generational cycle of poverty by preparing low-income youth for colege and citezenship;
  • Lay-offs in the thick of the holiday season of 22 employees of West View-based Easter Seals of Western and Central Pennsylvania, which provides services and employment for people with disabilities and special needs across 47 counties. For remaining workers,  plans called for imposing 30-percent pay cuts if the budget delay continued into this weekend;
  • Cut-off of $7 million in state funds intended to support food banks across the state, including Westmoreland County’s organization, which is owed more than $300,000;
  • The Westmoreland County Food Bank reports that annual Thanksgiving and Christmas donations are down substantially, while a record-breaking number of households continues to seek help;
  • Turning down of please for assistance from victims of domestic violence served by Crisis Center North, which covers northern and western Allegheny County. The agency, which funds about half its $825,000 budget with state money and federal money allocated through the state, had to stop giving emergency relocation funds to victims. Often, that financial assistance is key to victims getting safely away from their abusers. The risk to victims was so great, said Executive Director Grace Coleman,that federal officials had to order the state to turn over its portion of the funding.