The St. Croix Women’s Coalition, Boys and Girls Clubs, sports groups, steel bands, the USVI’s only drug rehabilitation center and dozens of other nonprofits apparently will not be funded this year due to the budget crisis, leaving the thousands they serve in the lurch.
On March 7, those non-profit organizations that receive “Miscellaneous” funding through Human Services got an email saying they would not be getting any payment for the current fiscal year, nor for the fourth quarter of Fiscal Year 2017, which ended last September.
“Unfortunately, at this moment, Office of Management and Budget has informed our department that they are unable to provide legislative funding to your organization and will continue to monitor the revenue and respond accordingly,” the email told those groups.
Human Services officials met with many of those nonprofits Monday at St. Thomas’ Knud Hansen Complex, to field questions and try to explain the bad situation as well as possible. The meeting was teleconferenced on St. Croix at the Bureau of Information Technology office in Castle Coakley.
Tuesday, Sens. Nereida Rivera-O’Reilly (D-STX) and Janelle Sarauw (I-STT) are scheduled to meet with affected local non-profits and officials from Human Services, the Office of Management and Budget, and Department of Property and Procurement, to talk about the matter. The meeting will take place at the GERS conference room on St. Croix and at the West Indian Company Conference Room on St. Thomas at 10 a.m.
“We wanted to clear the air to to deal with the issues that are before us and how we want to handle the nonprofits going forward,” Human Services Spokesperson Carol Burke said about Monday’s meeting after it was over.
“The nonprofits deal with a lot of the needs that Human Services is mandated to carry out and we certainly value their participation with the targeted groups they serve,” she said.
But Human Services has not been given the money, so it does not have it to give to the nonprofits, she said.
According to Burke, Human Services Commissioner Felecia Blyden told the nonprofit groups that showed up Monday that they are not certain there will be no funding but they do not have the funding now and do not yet know how much there might ultimately be.
“We wanted to see what their needs were and get a sense of what the aggregate amount,” Burke said.
“For some of them it was about not being able to carry out services beyond the end of April while others talked about overextending themselves in the aftermath of the hurricanes in anticipation of getting funding from the government,” she said.
Burke added they have been in constant contact with the Office of Management and Budget but there is no word yet about how much there might be or when it might be available.
They are also looking into the extent to which federal assistance might include “any kind of services nonprofits provided in the aftermath of the storms,” she said.
Human Services strongly supports those groups missions, “but the truth of the matter is we are not the funding arm of the government. We have not received the funding as of yet. We totally understand and support that they are sounding the alarm and we stand side by side with them,” Burke said.
With budget hearings delayed by half a year and much uncertainty over where revenues and expenses will be after the storms, the Legislature recently decided to punt and let the previous year’s budget appropriations stand for the current year too. Since revenues are different – and lower – than last year, those appropriations really amount to caps, not the actual money available. In practice this means the governor’s financial team will make all the budgetary decisions.
The Fiscal Year 2017 budget had $105, million in the miscellaneous section, allocated to more than 150 different causes, including past due pension payments and retiree insurance. It is unclear how much each of these other major expenditures also are affected.
Before the storms, the territory had an unresolved annual structural deficit varying between $110 million and $170 million. Lenders are no longer lending, so this already meant austere cuts. Last fall, Gov. Kenneth Mapp’s financial team estimated the storms might balloon the shortfall this year to as much as $450 million. That is more than half of all local revenues and nearly half the total budget.
If the latest revenue figures published by the Internal Revenue Bureau are correct, all the insurance and federal spending in the territory for cleanup and rebuilding has greatly lessened the loss to only a few million below the figures for the same period the year before. While good news, that still means a bad budget situation is a little worse than the year before.