Nonprofit Facing Collapse

This letter urges everyone to recognize the depth of the budget crisis we now face and to become engaged in defending the safety net of services that people with developmental disabilities and their families depend upon.

Governor Brown has proposed a reduction of $750 million to community services for people with developmental disabilities. We don’t know which services will be cut, whether whole programs will disappear, or if cuts will hit everything. California is poised to dismantle the protections afforded in the Lanterman Act and greatly reduce or eliminate community program services.

Nearly all direct services and supports to individuals with developmental disabilities are delivered by community-based nonprofit organizations (like PathPoint), not by state offices or county (or regional) personnel. In many cases, these nonprofit organizations were founded by parents and local community members who created alternatives to the state-operated institutions that characterized California’s public policy regarding the developmentally disabled as recently as 1970.

California recognized the vast improvement in the quality of life offered by local community services and the enormous savings to taxpayers offered by a service system utilizing nonprofit organizations. In 1970, California began to convert the majority of its publicly funded service delivery system to a model based upon contracting with local nonprofit organizations. Rather than building public facilities, California has saved billions of tax dollars while providing extraordinary services to its citizens with developmental disabilities.

But, California did not establish a system for routinely adjusting its rates of reimbursement to nonprofit partners. Over time, these rates have fallen below the actual costs of providing services people need. Nonprofits have worked to raise additional funds to supplement state payments, and have stretched their operations as thin as possible to survive. Nonprofits have been hurt badly by the recession. Private fundraising has suffered, and, unlike the financial sector, the public response has been further funding cuts rather than “bailouts.”

The proposed $750 million reduction in California’s funding to the developmental disabilities community, on top of the previous years of rate cuts and freezes, will lead to the collapse of the nonprofit organizations the state relies upon to deliver services. There is simply nothing left to cut. These organizations are made up of large numbers of direct service staff supervised by a small group of managers who work for far less than their public or private sector counterparts.

Given the undeniable needs of people with developmental disabilities, there is simply nothing left to take away. Community based organizations are being left to sort out how long they can continue to spend money they don’t have, to meet California’s legal and ethical obligations.

If – or should we say when – we fail, who will take our place? Will California step back in to create a new system of residential and day services for individuals with disabilities? Where would those funds come from? And, is a costly and bureaucratic state system what we hope for after so many years of community-based independence? If we permit the collapse of nonprofit organizations, we will have lost everything.

Consumers, family members, friends, policy makers: the organizations that you depend upon now depend upon you. Without delay, contact your State Assembly member and your State Senator. The message is simple: “Please stop! Just for a moment consider how deeply you cut last year and how seriously the safety-net has already been weakened. This new cut is too deep. The risks to people’s lives are too real to make these cuts without first understanding their consequences and searching for alternatives.”


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