How bad is the rise in homelessness in Washtenaw County? “We served 1,200 people last year, and we still have a waiting list of three people for every bed,” says Ellen Schulmeister, executive director of the Shelter Association. “But it’s really much bigger than even that. There’re people out there living in their cars!”
The shelter has come a long way since Schulmeister was hired in 1998. “When I started, all we had was a bunch of old dilapidated buildings, and our budget was $600,000,” she recalls. “Now we have the Delonis Center and a budget of $1.7 million.”
And the fifty-bed shelter and support center was supposed to be only the beginning. “We had a plan to end homelessness in ten years and we were on track to do it, too,” Schulmeister says. “Then the economy crashed, and now the need is greater than ever.”
But the same recession that’s put more people in need has also left governments less able to pay for services like the shelter. Schulmeister figures that “as much $650,000 is at risk from city, county, and state funding. We used to be targeted [for cuts by the state legislature], and with the whole state in a crisis and a Republican Congress, we may be a target again. And the city and the county are going to have to choose between mandated services and supporting the nonprofits.”
“We’re going to lose some social services funding,” agrees county commission chair Roland Sizemore. “Not just at the county level but at the state and federal level.”
And there’s nothing anyone can do to stop it. When property values plummeted, so did property tax receipts—even as employee benefit costs, particularly for health care, continued to climb. The county’s income from property taxes fell by $13 million between fiscal 2008 and 2011, which started last July. That left the county commission facing a projected $30 million deficit for the current two-year budget cycle. They closed that gap with the help of employee wage concessions—but county treasurer Catherine McClary projects property values will fall another 8.5 percent next year. For the next two-year cycle, the county is projecting further deficits—$11.5 million in 2012–2013, and $16.2 million in 2013–2014—two more huge bites from an already lean $214 million annual budget.
Unlike the federal government, the county can’t run a deficit. And because the county is mandated to support services like the jails, the prosecutor, and the courts, cuts inevitably bite deepest into discretionary general fund spending. Social services, discretionary spending’s biggest beneficiaries, were the hardest hit in the last round—and likely will be again.
“We’re going to have to cut funding, cut services, and cut some employees,” says Sizemore. He says it’s too soon to speculate about how much. But Schulmeister of the Shelter Association believes “the county’s cut will probably be the same as [in] the last two-year budget cycle: 20 percent.”
And there’s nowhere to go for help. “The state’s not in a position to help us,” says Ann Arbor county commissioner Leah Gunn. “They’re facing huge deficits. And the feds? Look who does the appropriations: the House! Can you see John Boehner helping us?”
Barbara Bergman, with Gunn the county board’s social services champion, has one word to describe the deficit’s impact on social services: “Horrendous! Vulnerable people will not get the things they need, and there’ll be even more human suffering.”
“We are the safety net.”
Even before the plan to end homelessness, the Delonis Center went well beyond the basics of providing emergency shelter. It tries to help people find permanent housing and stabilize their lives.
Jack—not his real name—ended up at Delonis in 2009 after he lost his disability benefits and his home. With osteoarthritis and a history of chronic alcohol abuse, he was deeply depressed.
The center assigned Jack a case manager who hooked him up with the VA for medical and psychiatric care, and an attorney to get his disability benefits reinstated—plus a list of nearby Alcoholics Anonymous meetings. Now Jack’s sober and living independently again.
“Kathy” came to Delonis last year after losing her apartment. She was working full-time, but when she couldn’t afford a car repair, she’d rented a car to get to her job—and then couldn’t keep up on her apartment rent.
The center connected Kathy with Friends in Deed and the Ann Arbor Thrift Shop. The volunteer groups agreed to pay some of her car-repair costs, helped her find a repair shop that gave her a generous deal after the manager heard her story, and assisted her in finding a new apartment. Now’s she’s supporting herself again.
Happy endings like these are far less likely if the shelter faces significant funding cuts. “There are people who would like to stop funding nonprofits altogether, including the Delonis Center,” Schulmeister says. “And the county has already made huge cuts in their operations in the last couple of years. But our basic service has to be supported. We are the safety net in Washtenaw County.”
If her fears are realized and Schulmeister loses another 20 percent of her county funding, she says she’ll “make cuts in administration and programs and probably non-residential services. Right now we provide laundry, showers, long-term storage, and shelter space for non-residents. If we cut staff, we won’t be able to do some or all of that. And we might not be a twenty-four/seven operation. Now the front door is kept open at all times because we have someone there to watch it. But if we have to cut personnel, we won’t have someone there, and we won’t be able to do that anymore.”
Although some regard homelessness as an urban problem, Schulmeister stresses that Delonis serves “people from every township and community in the county. Homeless happens from Manchester to Ypsilanti, though in more rural areas, it’s a lot more hidden. A couple years ago in Scio we found three or four people living in an abandoned hotel!”
She also emphasizes that “in my entire history with the Shelter Association, 75 percent of the people we serve come from inside the county and 25 percent from outside, mostly western Wayne County. But at the Delonis Center, we have a rule: you must become homeless in Washtenaw County. We get local support, and we believe we have to serve our population first.”
Schulmeister says the current crisis will “only end as the economy slowly and gradually improves—at least five years if not ten, if there are no major setbacks. But in the meantime, demand is increasing and will be increasing, and government support is not going to be there. So we’re going to have to do more fundraising. We’re already raising $750,000 a year—now we’ll just have to raise more.”
“The need is as great as ever”
The Shelter Association is only one of the social services that relies of government funding—and thus is in danger of cuts. Another is Head Start.
“I don’t want to talk about future cuts,” says Pat Horne McGee, county director for the preschool program. “We’re dependent on the federal government, and we never know from one year to another what’s been approved—and with a new Congress!”
If Horne McGee sounds scared, she has good reason. An omnibus federal spending bill that would have boosted Head Start funding was withdrawn by the Senate leadership in December, leaving the program’s fate up to the next, more conservative, Congress. The rest of Horne McGee’s funding comes from the county—and with four new Republican commissioners taking office this month, it remains to be seen how the board will view the county’s discretionary $500,000 contribution to Head Start’s $4.5 million budget.
“We’re not one of the county’s mandated services,” Horne McGee explains. “But Head Start is very important to the children and families of the entire county. We’re funded to serve 561 children and families, and we have a program in Manchester Township and in Willow Run, in Lincoln School, and Whitmore Lake.
“And currently all our sites are full,” Horne McGee concludes. “The need is as great as ever, and even more so with the layoffs. And last year we already made cuts. Everybody here has been reduced in staff time. I don’t know what else can be cut!”
“We’re a poor state now”
With a budget of $30 million, Washtenaw County Community Mental Health is by far the county’s biggest social services agency. Only $1.5 million of that, though, comes from the county’s own funds.
“Almost all our revenue comes from the federal and state governments,” explains director Patrick Barrie. “Though the number of people using our services has expanded over the past few years, the poorer you are as a state, the more the federal government kicks in.
“But the stability comes into question because of the feds,” Barrie continues. “If we can make it to 2014 without cuts, then all community mental health will be paid for through Medicaid money [as part of the federal health reform law]. It’ll save the state $150 million a year—if we can hold the fort until 2014.”
The question is whether the state can hold on that long. “I’m afraid there will be executive-order reductions next year,” Barrie says. “There are two revenue estimation conferences, one in January and one in May, and if they show a downward projection of revenue, the governor can issue an executive order cutting pretty much anything he wants. The majority of [the state legislature] has to approve it, but both houses are Republican now.”
Barrie figures most of the county’s funding is safe, because it’s required to win state and federal matches: “They get nine bucks back for every buck they put in.” Most—but not all. “The county does put in supplemental funding, and they’re reducing that,” he explains. “When you have this kind of massive unemployment, people who thought they were safe are hitting the wall financially and emotionally, and that creates a lot more demand. Money doesn’t expand with demand, so demand and available resources will cross at some point.”
Michigan is near that crossing point. “We’re a poor state now,” says Barrie. “We lost a million jobs in the last decade, and because of our tax structure we don’t get taxes that capture all income that is there. Plus, we can’t hold on to our young people anymore—my two grown sons have left the state—and the old people here can’t go anywhere because they can’t sell their houses.
“I’ve heard that our employment levels will return to 2000 levels in 2032,” Barrie concludes, “but that seems overly pessimistic to me. But then, I never believed it would have gone on this long!”
Barrie has one more fear: “I’ve heard the new governor will change the business tax, reducing it or even eliminating it. And I don’t know where we’ll get money after that.”
A millage for social services—or police?
Commissioner Bergman can think of one possible source, “a social services millage. We’ve got a good integrated system, but there’s not enough money in it—and this could be a solution.”
“A social services millage is a great idea,” says Ellen Schulmeister. “People in Monroe County passed a similar millage for their shelter. And they did it in Dade County [Florida] through a restaurant tax—and built three shelters with the money!”
A restaurant tax has the added appeal of tapping a discretionary, but growing, spending pool: the county’s public health director says that despite the recession, his people are checking more restaurants than ever. But any social services millage would have to pass not just in social service conscious–Ann Arbor but also in the townships—which have historically favored police over human services.
“People are interested in a police services millage,” acknowledges Ann Arbor commissioner Conan Smith, “and we need to address the political reality to address the human reality—that either a police services millage or a human services millage would create more flexibility in the general fund budget.” Since police services are now subsidized out of the general fund, a millage for that could free up money for social services.
This puts Smith in the unusual position for an Ann Arbor commissioner of spearheading a police services millage—though in the cause of smaller social services cuts. Calling himself the leader of the commission’s “tax caucus,” Smith says he’s “driving the conversation about new revenue—about what we’re going to do about a millage next year [in 2011]—and how it gets strategically allocated.”
But even in Ann Arbor, the passage of any millage is no sure thing. Because even here, the real estate crash is far from over.
“Property tax delinquencies are always a leading indicator of foreclosure,” explains county treasurer Catherine McClary, “and Ann Arbor’s rose last year and again this year. It’s going to be rougher than anything we’ve seen before.”
As more Ann Arborites fall into foreclosure, they’ll need social services more than ever. But will they be willing—and able—to support a millage to provide them?
