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State budget myths

“Public debate over the state fiscal crisis is distorted by a set of widespread myths,” according to a new report from Voices For Illinois Children.  “The central myth is that the state’s massive budget deficit was caused by runaway spending.”

In fact, almost 60 percent of the state’s $12 billion budget deficit reflects declining revenues caused by the recession.   Spending for human services has not kept pace with inflation during this decade.  And trying to reduce the deficit with spending cuts alone would require cuts of up to 75 percent in human services and other non-mandated portions of the general funds budget.

New Welfare Rules Called Counterproductive

The proposed tightening of federal rules on workforce participation by TANF recipients could undercut successful local programs that move welfare recipients into well-paying jobs, advocates say.

Local groups including the Heartland Alliance, the Chicago Jobs Council, and the Sargent Shriver National Center on Poverty Law are submitting comments this week on new regulations proposed by the U.S. Department of Health and Human Services after TANF was reauthorized in February.

With city and state support, the Chicago area has emerged as a leader in transitional jobs programs which, in contrast to “work-first” approaches, provide a continuum of services to address multiple personal employment barriers and use real work experience to transition to permanent jobs, with high success rates, said Melissa Young, coordinator of the National Transitional Jobs Network at the Heartland Alliance. The new rules would limit access to supportive services and cut back on the number of training opportunities, she said.

New limits on vocational education would restrict programs at the Community Assistance Program, which customizes training for TANF clients based on job requirements provided by prospective employers, said Sheryl Holman. And increased paperwork and monitoring requirements would reduce the time her staff can work with clients, she said. CAP trains TANF clients and others at five South Side locations.

The new regulations would also make it harder for employment services working under the federal Workforce Investment Act to serve TANF clients, said Rose Karasti of the Chicago Jobs Council.

The HHS proposal ignores the lessons of the first ten years of TANF – that entry-level employment is not a bridge out of poverty, but that welfare recipients can succeed with the proper support, said John Bouman of the Shriver Center. “The focus needs to be on reducing poverty,” he said.

Helping Katrina Victims, Facing Cuts

Even as they ramp up efforts to help hurricane victims move beyond survival needs, Cook County anti-poverty agencies are looking at drastic cuts in their federal funding.

Community action agencies coordinated by the Community Economic Development Association in suburban Cook County are uniquely positioned to help victims as they begin to reestablish their lives, offering a range of services including case management, transitional and affordable housing, job training and placement, health and nutrition programs, childcare and senior care, and small business assistance.

Working with evacuees in state shelters in Tinley Park, Madden, and Maywood, CEDA began a $100,000 fund to help people with necessities beyond the food and clothing offered by emergency services — things like toiletries, medicine, and school supplies, said Mark Enenbach of CEDA Cook County.

They’re also providing food vouchers to families sheltering Gulf evacuees in their homes, he said.

As evacuees seek to move beyond shelters and make decisions about their future, FEMA, the Red Cross, and state agencies are increasingly looking to CEDA to “take the ball and run with it,” Enenbach said. “We’re trying to fill in gaps and find some longer-term solutions for these people….We’re going to be involved for the long haul with an awful lot of these families.”

Meanwhile they’re planning for a 50 percent cut in the Community Services Block Grant which the U.S. House passed this spring. If not rescinded in a budget reconciliation process that has been postponed since Hurricane Katrina, the cut will go into effect at the end of the year.

“It would be devastating; it would mean closing centers and laying off staff,” Enenbach said. “This is exactly the wrong time for that kind of thing.”

Welfare Reform: Many Families Left Behind

Welfare reform here has a “mixed legacy,” according to the Illinois Families Study, a long-term study of 1,000 Illinois families who were TANF recipients in 1998. IFS recently released its fourth annual report.

Nearly half the families in the study (46 percent) have successfully left TANF for work, although almost all of them continue to live in poverty. But an almost equal number (43 percent) has access to neither welfare nor work, instead subsisting in conditions of “hardship and vulnerability,” according to the report.

“We don’t know how they’re getting by,” said Phyllis Russell of Work, Welfare and Families, a state advocacy group, commenting on the report. WWF is working to bring more attention to the problems of the “deeply poor,” she said.

Some may be receiving SSI or child support but “the majority is just winging it” — and many of them should probably still be receiving TANF, said Wendy Pollack of the Sargent Shriver National Center of Poverty Law.

Welfare reform created pressure to reduce TANF caseloads, and many clients aren’t told about all their options, Pollack said. “We’re losing a chance to invest in people, to address their barriers to work and build their capacity to maintain employment,” she said.

Working families in the study have benefited from employment supports like childcare subsidies, health insurance and food stamps, but almost all of them continue to live in poverty. Fully 89 percent of those working and receiving no TANF earned below the federal poverty level, with other public benefits included in their income. Their average annual income was below $15,000.

“What is our obligation to people who we’ve pushed into $7-an-hour jobs?” asked Russell. “We need a discussion about our commitment as a society to provide supports that will help people in low-wage jobs move out of poverty.”

“The major challenge of the next phase of reform in Illinois will be helping unemployed families gain and maintain jobs while continuing to support families who are newly self-sufficient,” said Dan Lewis, professor of education and social policy at Northwestern University and principal investigator for the Illinois Family Study. He noted that work supports are necessary “to make it worthwhile to work in a low-wage environment.”

How Accessible are State’s Human Services?

The Illinois Department of Human Services violates federal and state law by turning away applicants for income supports, according to a new study to be presented at a legislative hearing Wednesday.

In a one-day customer survey at five of the busiest local IDHS offices in Cook County, the Center for Impact Research found that 60 percent of those who had come to apply for food stamps, Medicaid or TANF were unable to do so.

State and federal law mandates that anyone who wants assistance has the right to apply on their first visit to an IDHS office, said Lise McKean of CIR. IDHS policies requiring that applicants be referred to teen parent services and screened for expedited food stamps were not followed, she said.

The study will be presented at a hearing of the Illinois House Human Services Committee, chaired by Rep. William Delgado, on Wednesday, October 15 at 10 a.m. in the Thompson Center. The hearing will examine access to TANF, food stamps, and Medicaid.

Among the concerns is growing workloads for caseworkers (with caseloads as high as 1200 per worker in Cook County) as positions are cut while food stamp and Medicaid cases increase; and whether the state’s goal goes beytond reducing TANF caseloads to encompass supporting employment and reducing poverty, said Work, Welfare and Families executive director Phyllis Russell.

While poverty in Illinois is rising — and the number of working people living in poverty is growing — Illinois led the nation in TANF caseload reduction over the last two years, with a decline of nearly 40 percent between March 2001 and March 2003, according to the CIR study.

Youth Worker Certification Now Available

Working with troubled youth can be highly demanding, but until recently no professional training programs and no certification process existed for youth workers. One result was high turnover, as youth workers seeking advancement went into other fields.

Only recently has the U.S. Department of Labor established “youth worker” as an occupational category and begun piloting a youth development curriculum, called Advancing Youth Development, in 18 cities including Chicago. Chicago’s Department of Human Services has taken professional development for youth workers further, offering college credit and professional certification with the new Youth Development Practitioner Certification Program, designed and implemented by the Chicago Area Project and cosponsored by the Chicago City Colleges.

This Friday 150 youth workers from community organizations throughout the Chicago area will graduate from AYD and YDPCP classes. The ceremony is Friday, May 30, 10 a.m., at Spertus Institute, 618 S. Michigan. “The size of this graduating class indicates both the success of — and the need for — professional youth worker training programs in Chicago,” said CAP executive director David Whittaker.

Applications are now being taken for Fall 2003 classes.

On June 7 CAP holds its annual Youth Summit, with over 200 young people expected, many of them participants in CAP’s Youth As Resources grassroots organizing project, which involves young people in community service and anti-violence projects which they design themselves. The summit is Saturday, June 7, 9 a.m. to 2 p.m. at Dawson Technical Institute, 3901 S. State

Nonprofits: Greater demands, fewer resources

Local nonprofits are in survival mode. As demand for services increases, funding sources are shrinking. Program cuts, staff layoffs and waiting lists grow, and consolidations and possible closings loom.

“It’s very different than anything we’ve experienced in the past,” said Delena Wilkerson, executive director of the Nonprofit Financial Center. Previously, corporate or foundation support would fill the breach when government funding dried up. Now, “all the sources are tightening up at the same time.” She predicts “the nonprofit sector will face tough times for two or three years, even if the economy starts to turn around.”

NPFC is promoting “survival strategies,” including considering collaborations and mergers, Wilkerson said. And this week Shorebank, with over 150 nonprofit clients, is hosting a seminar on “Coping With Cutbacks.”

Agencies contracting with the state have taken the hardest hits. And lags in state contract payments are creating cash flow problems, while banks are calling in loans or refusing extensions.

“Community agencies are wondering whether we can afford to provide state-funded services,” said Suzanne Strassberger of Metropolitan Family Services; MFS has been approached by several agencies to discuss merger possibilities.  Staff layoffs cause waiting lists and triaging of services “so people don’t get help until they’re in crisis, which often means expensive interventions,” she said. The state should base reimbursement rates on actual costs, Strassberger said, should stop delaying contract agreements and payments, and should simplify certification and monitoring requirements.

“We routinely subsidize state-funded programs with charitable dollars,” and the gap is growing, said Dan Schwick of Lutheran Social Services. LSS has closed homeworker services for frail elderly and counseling programs, and cut positions in adoption services and children’s residential programs.

“We’ve tried to target [staff] cuts to central administration” but that makes it hard to meet state reporting requirements. The funding gap is “particularly acute around child welfare,” said Bob Gilligan of the Catholic Conference of Illinois, which backs Catholic Charities. “We’re seeing harder-to-serve kids who need more services, and the state commitment is not on the scale needed.” (Meanwhile, demand for emergency food and shelter is up 400 percent in Cook County this year, Gilligan said.)

Schwick and others expect more state cuts, possibly in the December veto session; state revenues declined last year for the first time in over 45 years, and they have not recovered this year.

“The state budget projects a modest growth in revenue, and it isn’t happening yet,” he said. This year’s gaps were plugged with one-time adjust-ments,”said Andrea Ingram of Voices for Illinois Children. “As a low-tax state, there is clearly room to adjust revenues in a way that doesn’t overburden citizens.”

Community-based employment and skills training programs are facing unprecedented cuts from major public funding sources while demand for services grows, said Vicky Nurre of the Chicago Jobs Council.

“We are getting tons of calls,” said Anita Flores of the Jane Addams Resource Corporation, while state programs funding JARC’s metalworking skills programs have been cut back or eliminated.

“We have clients coming back for a second and third round,” said Alan Goldstein of Jewish Vocational Services. “And each subsequent layoff makes it more difficult, adds to the problems — depression, savings depletion.” Goldstein adds, “We are starting to see people who were contributors coming in as clients.”

The Garfield Park Conservatory Alliance has been squeezed despite a major success with the Chihuily exhibit. “We’ve had more visitors than the last 50 years and we’ve had to cut staff,” said executive director Eunita Rushing. The Alliance, a nonprofit which does community outreach for the conservatory, has cut back on special events and is reevaluating community programming.

After doubling its budget in the last five years, the Blue Gargoyle Youth Service in Hyde Park recently cut staff hours by moving to a four-day week, after foundation support dropped precipitously. In recent decades “all the social services that used to be provided by the state have been farmed out to nonprofits,” said Gargoyle board chair Mel Rothenberg. “It’s a counterproductive way to provide services. All the key people have to spend all their energy scrambling for money.”



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