Suburban nonprofits bear burden of state's unpaid bills
Third in a series
A mother of two children with autism, Wanda Malone needs a little help balancing their care with the rest of life's tasks.
So a few times a week, a trained helper watches Jayden, 6, in their Aurora home or takes him to planned social activities, leaving Malone time to spend with DJ, 7, or to tend to other necessities.
The cost of the helper is supposed to be reimbursed through the Lisle-based Ray Graham Association. But that association sees months-long delays in state payments and, as a result, so does Malone.
She's owed hundreds of dollars, requiring her to prioritize payments for her children's other needs, including special diets for their food allergies.
“Can I buy the food that I need to buy that they have to have medically?” Malone says.
Illinois owes the Ray Graham Association nearly $2 million, a snapshot of the state's unpaid bills on Sept. 8 showed. Of that, about $1 million was more than 30 days past due.
The Ray Graham Association is among thousands of community groups and charities making up Illinois' system for providing human services: The state contracts out the work and agrees to make reimbursements. But as Illinois' budget crisis worsens and the state lags further behind in paying bills, those who serve the state's neediest are forced to make dire decisions and, at times, heroic sacrifices to pick up the slack.
“The burden of survival for human services has been passed to our dedicated staff,” said Gretchen Vapnar, executive director of the Community Crisis Center in Elgin, a domestic abuse program that relies on Illinois for half of its funding. It maxed out a line of credit this year while waiting for funding, leaving employees to take four weeks of unpaid furlough days, especially difficult for entry-level employees earning $25,000 a year.
An analysis of state data Associated Press found that the backlog isn't as dire for human services as for other parts of state government, but it still amounted to more than 31,000 bills totaling $425 million as of Sept. 8.
At the same time, need is increasing. More than 14 percent of Illinois' population lives in poverty, the highest rate since 1992.
Human service providers have struggled to adapt and search for new, private funding sources to help cover for the government's lagging support.
Often, employees or vendors are forced to absorb much of the pain. Lambs Farm in Libertyville, an organization that helps the developmentally disabled, stopped contributing to employees' retirement accounts and made them take furlough days. That came after years without raises.
Director Dianne Yaconetti said those staff sacrifices are how the agency kept offering all its services, despite the state's delinquencies.
“They were very proud of the fact that they helped us at a time when we most needed it,” she said of the employees.
Like other agencies, Lambs Farm has tried to step up private fundraising, using its recent 75th anniversary as an occasion to reach out to new donors.
Fortunately for the workers, the bill backlog has shrunk. But Lambs Farm was still owed more than $330,000 in overdue bills as of Sept. 8. All of it is at least 30 days overdue; some bills date to July.
The Ray Graham Association, the agency that reimburses Malone, has eliminated more than 30 positions in past years, some of them from layoffs, President Kim Zoeller said.
A facility in Bloomingdale was closed. Some of the existing staff members were trained to replace lost people. But no one was dropped who needed services, Zoeller said.
“It doesn't mean it's not painful,” she said.
Ray Graham's overdue bills from the state stood at more than $1 million as of Sept. 8, much of it dating back to June.
Illinois ranks first nationwide when it comes to nonprofit groups reporting late payments from the government, according to a survey last year by the nonpartisan Urban Institute. More than 80 percent of Illinois groups say their money doesn't come on time.
The state's inability to pay its bills even trickles down to businesses that have no state contracts. In Elgin, Joseph Paul runs substance abuse programs at the Elgin Center, a facility run by Lutheran Social Services.
He said at times the center has had to delay payment to the people they do business with.
“Then, agencies like ours say, ‘Can we keep doing business with the state if we're not getting paid?'” he said.
Yet the state as well as the needy benefit from human services providers' reluctance to abandon clients.
The Des Plaines-based Lutheran Social Services was facing more than $1 million in late, unpaid bills to its various agencies as of Sept. 8. It borrows from an endowment and a bank and pays its own vendors late, but CEO the Rev. Denver Bitner said constantly pleading with the state is the only effective thing.
“That's the only way you'll be paid,” he said. “I burned a lot of miles between here and Springfield.”
The Family Service & Community Mental Health Center for McHenry County, which has served thousands of northern Illinois families, got an advance from the county to cover bills while staff members took 3 percent pay cuts, unpaid furlough days and fewer holidays.
The state owes the agency almost $500,000.
Human services providers say they face a two-front war over funding. One, of course, is that the state is late in paying what it owes.
The other is the constant worry that lawmakers, facing looming shortfalls, will simply cut back on funding — meaning local providers will go from getting paid late to getting paid less.
“It feels like a never-ending environment of being in a fiscal vise and being squeezed,” Paul said.
Daily Herald news services contributed to this report.
• No. 1 for nonprofits reporting problems with late payments (83% compared to the national average of 53%).
• No. 1 for nonprofits borrowing money or increasing lines of credit (42%; nationally 22%).
• No. 1 in nonprofits reporting a worse experience than the year before (57%; nationally 31%).
• No. 2 for nonprofits reporting frozen or reduced salaries (65%; nationally 50%).
• No. 3 when it comes to nonprofits reducing employees (54%; nationally 38%).
• No. 3 for nonprofits reporting reduced programs or services (31%; nationally 21%).
• No. 17 (tied with California) for reporting reduced state revenues for human services (60%; nationally 56%).
Source: Urban Institute