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The Trickle-Down Budget Crunch The Trickle-Down Budget Crunch

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The Trickle-Down Budget Crunch

Already overwhelmed by the slogging economy, community-service agencies are bracing for a punch to the gut from the federal budget crisis.

CORRECTION: The original version of this report misspelled the name of Patricia Nickols, CEO of the Community Action Partnership of San Bernardino County.

“Live free or die” is the state motto of New Hampshire proudly emblazoned on license plates and the credo by which its citizens live.


This is the state, after all, that has some of the lowest taxes in the nation, where there are no mandatory seat-belt laws, and where one can openly carry a gun into the statehouse. New Hampshire’s individualism has served it well—it has weathered the recession and recovered with astonishing ease.

But that’s of little comfort to the people of rural North Country, where the papermaking industry once formed the backbone of the local economy. The mills that had been the lifeblood of generations of workers have been shuttered in recent years, and former employees have found themselves down on their luck with nowhere to go.

So they turn to Gale Hennessy, president of the New Hampshire Community Action Association, which represents six local agencies, for help.


Hennessy and his staff run worker-training workshops, administer Head Start for low-income children, and manage energy and fuel-assistance programs, among a host of other services.

“This is the world we live in,” Hennessy said. “If you’re poor in New Hampshire, there really [are] very few state or local services available to you so the community-action agency network is tremendously valuable.”

But Hennessy is staring down the prospect of turning people away next year as the national network of community-action programs, created 47 years ago as part of President Lyndon Johnson’s War on Poverty, faces its own crisis.

The program operates 1,065 local agencies around the country that do everything from managing food banks and homeless shelters to providing for the elderly and responding to emergencies, all based on community needs. Despite having served more than 20.7 million people in 2009, with the number expected to rise for 2010, President Obama singled the program out for budget cuts during his State of the Union address in January, to the outrage of community-action advocates around the country.


The Community Services Block Grant, which provides the funding for the agencies and is administered through the Department of Health and Human Services, would be halved under the administration’s budget proposal from $700 million to $350 million.

Don Mathis, president and CEO of the Community Action Partnership, the national association of agencies, fears that as budget negotiations with congressional Republicans get under way, the program will be hit with even more devastating cuts.

With one in seven Americans living in poverty, state and local budgets pinched, and demand for services greater than ever, it’s the worst possible time for a severe cut to one of the only comprehensive antipoverty initiatives remaining, supporters said.

“I couldn’t even begin to imagine that there’s going to be anyone to pick up the pieces,” said Cathy Hoskins, executive director of the Salt Lake City Community Action Program. “This is a lifeline to so many people.”

Hoskins keeps the proof on her desk—dozens of letters she receives from grateful clients. Last week, one came from a woman who was on the brink of letting an abusive husband back into her home out of desperation. “It is not easy to start over at 50 years old with one child and one autistic teenager, but you have made it so I can,” the woman wrote. “Please share my letter and let me know how I can help—short of money because I don’t have any.”

Although local agencies draw funds from a number of sources, money from the Community Services Block Grant provides much of the administrative and operational glue.

One California agency’s situation illustrates the program’s conundrum. Each month, the Community Action Partnership of San Bernardino County’s food bank feeds 50,000 hungry people using food provided by the U.S. Department of Agriculture and donated through local drives. But CSBG money keeps the show running, providing for staff and other miscellaneous costs. Having those funds taken away would hamper the agency’s ability to effectively distribute food to those who need emergency assistance, said CEO Patricia Nickols.

“At a time when gas in our area is nearing $5 a gallon, when our unemployment is in double digits, when we have 14 percent of people living 100 percent below the poverty line,” she said. “It could not be a worse time to cut us back.”

Some have already begun to feel the impact of the budget crisis. The agency serving Michigan’s Oakland and Livingston counties, northwest of Detroit, have already laid off eight staff members and are considering which programs to ax. In Utah, Hoskins, too, is steeling herself to shut down five food pantries, an after-school program for low-income children, and an employment-readiness program, among other services, should funding be denied.

John Donnellan, executive director of the agency in the Dayton, Ohio, area, where two automobile manufacturing plants have closed and foreclosure rates have skyrocketed, is readying himself for a fight. Likewise, supporters around the country are meeting with their state’s congressional delegations, launching letter-writing campaigns, and pleading with elected officials to save their funding. Facing some criticism about oversight, the national association has put together a working group on how to promote accountability and best practices to allay concerns.

“You can’t live in America and be oblivious to the significant debt crisis this country faces. We saw all along that this solution should be across the board,” Donnellan said. “But the idea that all of this should be on the backs of the poor—it’s absolutely unthinkable.”

This article appears in the June 13, 2011 edition of NJ Daily.

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