How does the federal shutdown affect NYC children and families?

When Congress shut down the federal government nine days ago (and counting), billions of dollars stopped flowing from D.C. to state and local governments. With notable exceptions, most social safety net programs have kept running, using a patchwork of funds left over from the last fiscal year, contingency dollars from federal agencies, and money from state and local governments. What does the shutdown mean for programs that serve children and families in New York City?

In most cases, the answer is not much...yet. The majority of social service programs are safely funded through the month of October—either because they have carryover money from before the shutdown, or because the programs don’t follow the yearly federal budget cycle.

If the shutdown lasts into November, then city programs—and the families they serve—will face much bigger problems. Contingency funding plans, created by many federal agencies to help programs ride out the shutdown, only last through October 31. Few state or city agencies have the kind of rainy-day money that would keep programs running for long, without federal dollars coming in. The standard public statement offered by city agencies is that they won’t speculate on November.

The uncertainty is particularly damaging for organizations like food banks and soup kitchens, which anticipate increased demand due to major cuts in the federal food stamp program, set to take effect in November regardless of what happens with the shutdown.

Read on for a rundown of the shutdown’s consequences for New York City programs. Of course, these assume that Congress doesn’t default on its debts on October 17. In that case, all bets are off.

FOOD AND CASH ASSISTANCE PROGRAMS

Food Stamps: Federal money for the Supplemental Nutrition Assistance Program (SNAP, also known as food stamps) is safe until the end of the month. That’s because Congress authorized funding for the program as part of the Recovery Act, back in 2009. Since the authorization was already set to last until October 31 of this year, SNAP wasn’t subject to new budget appropriations on October 1.

If the shutdown lasts into November, the US Department of Agriculture has said that it will disburse about $2 billion in contingency funds, which states can use to keep their SNAP programs going.

However, come next month, SNAP will face cutbacks that have nothing to do with the shutdown. Not only will the program almost certainly be cut when Congress passes the Farm Bill (before the shutdown, the Senate’s version of the bill included a SNAP cut of $4.1 billion; the House of Representatives’ bill slashed the program by $40 billion over 10 years), but it will also be subject to a cut that’s been pending since 2010. As part of the “Healthy, Hunger-Free Kids Act” nearly three years ago, Congress funded an increase in school lunch reimbursements by planning a major cut to SNAP, scheduled to take effect November 1 of this year. If the cut goes into effect, New York City residents will lose $19 million per month in food stamp benefits, according to an analysis by the Food Bank for New York City.

Women, Infants and Children (WIC): At the beginning of the week, WIC, the federal program that helps pay for food for pregnant women, new parents and kids up to age 5, looked to be at serious risk of shutting down. Yesterday, however, the USDA released new guidance allowing states to tap into a pot of contingency money, which should keep the program running through October 31. If the shutdown lasts into November, New York State would likely need to come up with its own money to cover the lack of federal funds.

Emergency Food: Last-resort food programs like food banks and soup kitchens rely heavily on federal support. The Food Bank for New York City, which funnels most of the emergency food that goes to hungry New Yorkers, gets about half of its food supplies through the USDA’s The Emergency Food Assistance Program (TEFAP).

The TEFAP supply is safe for this month, because the program had purchased October food before the shutdown. But since no new orders can be placed, TEFAP food will disappear if the shutdown drags into November.

School Lunches: School lunch money comes through the federal Office of Child Nutrition Programs, which has said there are enough carryover funds from last year’s budget to cover meals through the end of October. If the shutdown continues and federal funds dry up in November, advocates speculate that City Hall will likely cover the costs. But with nearly 80 percent of the city’s public school students eligible for free or reduced-cost school lunches, that would be a major, unforeseen hit to the city’s budget.

Cash Assistance: New York State’s Family Assistance (FA) program provides temporary benefits to needy families with children. Technically, FA shouldn’t be touched by the shutdown, since it operates under the federal government’s basic welfare program (Temporary Assistance for Needy Families, or TANF), which is a mandatory program and therefore not reliant on yearly appropriations. However, TANF does have to be renewed by Congress. The program’s current authorization expired on September 30th, but states are are allowed to use their own money and carryover funds from last fiscal year to keep the program going.

The New York State Office of Temporary and Disability Assistance (OTDA) says that the Family Assistance program will operate as usual through October 31. A spokesperson declined to speculate on what might happen if the shutdown continues into November.

EDUCATION, CHILDCARE AND AFTER SCHOOL

Head Start: None of the city’s Head Start programs are at risk of closing this month. Most of the programs, which serve low-income kids aged 3-5, are administered by the city’s Administration for Children’s Services (ACS). While ACS uses federal dollars to fund the programs, its contracts started earlier this year and are not immediately dependent on a new federal budget.

Fortunately for city kids, none of the Head Start programs located in the city had federal contracts up for renewal in October.Nationally, 23 Head Start programs (serving a total of 19,000 kids) were up for contract renewal on October 1, according to the National Head Start Association. Until they were rescued yesterday by a billionaire couple from Texas, seven programs had shut down and six were on the brink—including one in upstate New York.

Schools: Public schools are "forward funded," which means they obtained this year’s federal funding–which covers about 10 percent of the school system’s operating expenses—in last year’s budget and will not be affected by the shutdown.

Childcare and After School: Most of the city’s subsidized childcare programs operate under contract with ACS. Since their contracts started earlier this year, they are not immediately affected by the federal budget or the shutdown.

After school programs administered by the city’s Department of Youth and Community Development (DYCD) and the state’s Office of Children and Family Services (OCFS) are similarly immune to the federal budget cycle, since their contracts began earlier this year.

CHILD SUPPORT AND FOSTER CARE

Like public schools, child support and foster care services received advanced appropriations in last year’s federal budget, leaving them untouched by the shutdown.

HOUSING

Public Housing: There is enough carryover and contingency money to fund public housing through the end of October, according to a plan released by the U.S. Department of Housing and Urban Development (HUD) on October 2.

Section 8: Housing Choice (also known as Section 8) vouchers covering October rents were disbursed before the shutdown. HUD predicts that carryover money will fund November vouchers if the shutdown continues.

Homeless Shelters: The city’s homeless shelter operators, which contract directly with the NYC Department of Homeless Services, are not affected by the shutdown.

 

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Number of Families Receiving Preventive Services Drops to 10-Year-Low

Administrative confusion in city government has left thousands of families with children at risk of entering foster care without help from critical support services in recent months, according to data released by the Administration for Children's Services. Despite an influx of emergency funding, the number of families taking part in programs that provide everything from counseling and case management to drug treatment and housekeeping fell 21 percent between April and July of this year, ACS data show. The number of children taking part in these "preventive" programs, which are designed to stabilize families in crisis and protect kids from abuse or neglect, has dropped to a 10-year low since April. New enrollments are down nearly 40 percent compared to last year, a dramatic reversal of a core city policy long intended to make sure children are safe at home while parents receive help dealing with extreme poverty, domestic violence, mental health issues and other difficulties.

The disclosure comes in the wake of the September 2nd death of a malnourished, medically fragile four-year-old Brooklyn girl, Marchella Pierce, whose mother has been charged with assault, drug possession and endangering the welfare of a child. The family had been receiving preventive services from the nonprofit Child Development Support Corporation, but the agency apparently stopped monitoring the family when its contract ended in June.

Preventive service programs have been hit by a triple-whammy of budget cuts, operational errors and strategic planning decisions that many advocates describe as both shortsighted and dangerous. "It's a train wreck," says Michael Arsham, executive director of the Child Welfare Organizing Project, a self-help and advocacy organization of parents involved with the child welfare system. "The provider community is in chaos."

Preventive services have been on the city's chopping block since ACS issued its most recent request for contract proposals this spring. In anticipation of a budget squeeze, and as part of a plan to provide more intensive services over shorter periods of time, the agency planned for a reduction of 2,400 (out of about 11,000) preventive service slots.

By the time ACS finished evaluating proposals this April, 600 more slots had fallen to budget cuts. Nine agencies were told they wouldn't be awarded contracts with the city, and many more were instructed to shrink their services and begin closing or transferring cases. "Child safety and risk were carefully considered in these assessments," says Laura Postiglione, a spokesperson for ACS. "Where families were found to need continued child welfare services, those families were transferred to another preventive program or re-referred to child protective services."

But administrators at preventive service agencies describe the period of caseload reduction as disorganized and painful. "It's not possible to cut 3,000 cases without putting children in danger," says Robert Gutheil, the executive director of Episcopal Social Services of New York, which was slated to lose nearly 50 slots at its Bronx preventive service site. "You have no choice but to reduce intake, which means only those with the most glaringly obvious problems are going to get any attention. Just as night follows day, we're going to have horror stories."

More than two months into the caseload cuts, a whole new layer of administrative chaos hit the system when the administration announced it had made a mistake in scoring contract proposals, and that its award recommendations, which had sent agencies scrambling in the first place, would be rescinded. Meanwhile, in June, the City Council announced that it would restore funding for 2,900 of the 3,000 lost preventive service slots.

ACS sent a memo to contracted providers, asking them to halt reductions. The administration reverted back to its previous set of contracts, extending all but two until the end of June, 2011, and asking provider agencies to ramp back up to their previous service levels. But by that time, many agencies were well into shut-down mode. Several had laid off staff, some had terminated leases and many had announced to clients they were cutting back on services.

"It's more than fair to say that hundreds of families fell out of the system," says Sophine Charles, a program director at Steinway Child and Family Services, which was scheduled to close after it didn't receive a contract award from ACS. "Now we're required to go back to our original utilization rates, but it's starting from scratch. How do you hire staff when your funding is only secure for the next eight months?"

The number of families participating in preventive services fell from more than 15,200 in June 2009 to just 12,230 in July 2010, according to data recently released by ACS (click to view chart). New enrollments fell from more than 1,100 in the month of March 2010 to just 579 during July (click to view chart). Many families must enroll in these programs under court order; others attend voluntarily with the encouragement of ACS child protective caseworkers, or they are referred by social workers, physicians or others in their communities.

Child welfare advocates, as well as members of the City Council, are pushing to have the money from the council's restoration funding baselined into the mayor's budget before the next fiscal year, which begins in July 2011, so that agencies have the ability to develop stable, long-term planning. The council's General Welfare Committee plans to hold a hearing on the changes to the preventive service system on September 28th, says Meghan Lynch, chief of staff for the committee's chair, Annabel Palma.

Public Advocate Bill de Blasio has also launched an inquiry into preventive service reductions, linking the cuts to the death of Marchella Pierce. In a letter to ACS Commissioner John Mattingly, de Blasio called on the agency to review every case that was closed during the April-to-July reduction period. "The heartbreaking circumstances surrounding Marchella Pierce's death raise troubling questions about ACS policies and practices and the possibility of systemic problems that could leave an untold number of children at risk," he wrote.

Chart: ACS new preventive cases, August 2008 , July 2010.

Click to enlarge.