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Delayed State Funding Sends Many New York AIDS Nonprofits Into Panic

September 28, 2010

State funding delays have forced Albany's Damien Center into debt. 'This has left us in an extremely perilous situation,' said its director.

State funding delays have forced Albany's Damien Center into debt. "This has left us in an extremely perilous situation," said its director.

Tens of millions of dollars in stalled payments from New York State have paralyzed hundreds of organizations that provide essential services to the neediest New Yorkers living with HIV/AIDS.

Meanwhile, none of the three state bodies charged with processing the payments -- the Department of Health, the Division of the Budget and the Comptroller's Office -- will accept responsibility for the hold up. The unexplained delay has plunged many of New York's AIDS nonprofits into deep debt, leaving directors wondering when, if ever, they will get paid.

"The legs are being cut out from under the table," said Michele McClave, executive director of the AIDS Council of Northeastern New York, which provides essential services to more than 1,100 people each year and depends on state contracts for more than $1 million of its budget. "You can only go so long without that support, eventually it's going to come crashing down on us."

The four-month delay in the finalization of New York's budget slowed the state's payments to many nonprofits. But while checks to organizations that provide other services -- like foster care, for example -- have started flowing in, those with financial contracts through the AIDS Institute (the division of the Department of Health that assists people with HIV/AIDS) have seen little to none of their money since April 1, the start of the fiscal year.


The Department of Health would not say how much the state owes to AIDS service organizations, nor how it plans to speed the process for drowning nonprofits. In Fiscal Year 2009-2010 the Institute disbursed $109 million over more than 700 contracts, and according to Elizabeth Fairweather, director of the Office of Administration and Contract Management at the Institute, numbers this year will be somewhat similar.

Waiting in Silence

To continue providing meals, transportation and health care, nonprofits -- many of them small grassroots organizations that count on every dollar -- have depleted their savings, stopped paying bills, taken out expensive loans, scaled back on services, considered furloughing staff and designed contingency plans if they are forced to shut down temporarily or permanently. Almost all of them have suffered the financial drought in silence, worried that speaking up about economic woes could scare off donors.

Perry Junjulas, executive director of the Damien Center in Albany, which receives 65 percent of its budget from state contracts, stopped accepting his salary this summer. The last six months have been the most stressful of his life, he said. "It has actually made me physically ill," he said. "The people who come to us, I couldn't imagine what they would do without us, they wouldn't be able to eat, they wouldn't be able to get mental health services."

Ninety percent of the 300 people who come to his nonprofit each year live far below the federal poverty line.

Even after the state pays up, the late delivery of critical funding will have severe repercussions on many of these nonprofits. McClave's council is now $1 million in debt. "It's going to take us years, if ever, to be able to dig ourselves out of this hole," she said. "This is my every day constant worry."

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This article was provided by Housing Works. It is a part of the publication Housing Works AIDS Issues Update. Visit Housing Works' website to find out more about their activities, publications and services.
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