State budget stalemate could cost non-profits billions

Crain's:

Gov. Pat Quinn vetoed a bare-bones budget on Wednesday, a welcome move for many social services providers because the spending plan would have deprived the state of as much as $5 billion in federal funds for programs that serve the poor, the homeless and other needy groups.

But the veto has left the state without a budget for the 2010 fiscal year, which began Wednesday, meaning non-profits that rely on state and federal funding don’t know how much money they will receive.

Already hurt by a drop in private donations, many non-profits are bracing for a reduction in government funding by cutting jobs and eliminating services. Some may close their doors altogether.

“Organizations stand in an extremely precarious place,” said Maria Whelan, president of Chicago-based Illinois Action for Children, an umbrella group for child-care programs.

The Chicago-based Carole Robertson Center, which provides early childhood care and education, laid off about 20 of its 170 staff members last Thursday. Those remaining will take a 25% pay cut, Executive Director Gail Nelson said.