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Nonprofits: A Great Deal For The State

LIZA ANDREWS

January 15, 2010

Recently a top administration official said that if the governor's proposed deficit mitigation plan passed, the state's nonprofit service providers would simply have to forego giving raises to staff. If only it were that simple.

While we certainly realize that political questions get political answers, this response misses the point. It contributes to the myth that nonprofits are not economic contributors; that we simply take from government and give nothing back. This could not be further from the truth.

First and foremost, nonprofits are employers. According to the state Department of Labor, nonprofits employ 11 percent of Connecticut's workforce. We employ taxpaying individuals and consume goods and services just like every other employer in Connecticut.

But even more important, we are a major force in creating taxpaying individuals. Nonprofits assist Connecticut's neediest residents to achieve self-sufficiency so that they can move away from using government-funded services and toward becoming contributing, taxpaying members of our communities.

Nonprofits also provide health and human services on behalf of the state at a great savings to taxpayers. The state Office of Policy and Management estimates that private providers hold around 2,000 contracts valued at approximately $2 billion annually. These contracts represent services for mental illness, domestic violence, HIV/AIDS, children and families, developmental disabilities and many others.

Often, the services provided by nonprofits allow the caregivers of people with developmental disabilities, people with mental illness or elderly parents to continue working and paying taxes instead of having to quit their jobs to stay home and provide around-the-clock care.

Further, these services prevent more exorbitant long-term costs, such as emergency room visits and incarceration. Again, nonprofits play a clear and crucial role in the health of our state's economic engine.

As the state continues to grapple with the effects of a national economic downturn and resulting budget deficits, the question remains as to how nonprofits will actually deal with reduced funding. We can say unequivocally that there will be job losses among private providers should further cuts be made. One of our members, a provider in northeastern Connecticut, will close if the governor's proposed freeze on state-administered general assistance is implemented.

That's 105 jobs lost by the closure of one nonprofit — many others will experience a similar fate. There will be fewer jobs and fewer services, leaving more people on the street, in emergency rooms and in the state's unemployment line.

And this at a time when the state Department of Social Services reports an 18 percent increase in enrollment for social services in just one year.

The governor proposed more than $123 million in cuts to health and human services in her November deficit mitigation plan that will directly affect nonprofits and the people we serve. The General Assembly wisely saw this and passed a bill that spared the nonprofit community and those we serve of devastating cuts. Unfortunately, Gov. M. Jodi Rell did not agree and has since vetoed their bill.

With less than three weeks left before the start of the 2010 legislative session, the legislature continues work on the budget deficit. As legislators and the governor continue to examine the state budget and evaluate possible cuts and potential additional revenues, we urge them to consider that our state's nonprofits are an engine of economic growth and provide stability to our population across our social and economic landscape.

We are partners with the state in providing health and human services, and if you want us to continue that role, we need the money and resources to do so. That means more than just "not giving raises next year."