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Commentary: Drastic measures needed to pressure state to adopt budget

Thursday, October 29, 2015   (0 Comments)
Posted by: Amy Seasholtz
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Berks County Community Foundation

READING, PA (Oct. 29, 2015) – As local nonprofits run out of options to keep their doors open, it’s time to consider drastic measures during the budget crisis, such as closing state liquor stores, said Kevin K. Murphy, Berks County Community Foundation president.

More than half of Berks County Community Foundation’s $2 million in low-interest loans for local nonprofits during the state budget crisis has already been earmarked for specific organizations. Only $965,000 remains available.

“We expect most of those remaining funds to be quickly claimed, leaving us with little left to help keep nonprofit organizations afloat,” Murphy said.

Though state government has halted payments to programs such as local domestic violence shelters during this crisis and several nonprofits are laying off employees and cutting services, the state Legislature saw fit to take out loans this week to pay its own salaries, Murphy said.

“There has not been enough pressure on state legislators and the governor to resolve this crisis,” Murphy said. “That’s why it’s time for the state government to stop paying legislators, their staff members and other administration officials. And we should close the state liquor stores until this crisis is resolved.”

“Perhaps with liquor stores closed, we will see Pennsylvanians more adamant that their elected representatives come to an agreement,” Murphy continued. “It makes little sense to pay liquor vendors but not domestic violence shelters or schools.”

Murphy said closing the liquor stores was the correct call two months ago when it was made by Maxwell King, president of The Pittsburgh Foundation. “Max was ahead of his time with that call, but he’s right,” Murphy said.

College students around the state are also suffering due to the budget impasse. Some students are going hungry because the state isn't paying out education grants. Friend Inc. Community Services has opened a food pantry to help hungry Kutztown University students.

For the 2014-2015 school year, the Pennsylvania Higher Education Assistance Agency’s awards to Community Foundation scholarship recipients totaled $89,098, which benefited 71 students.

Due to the budget impasse, the 2015-2016 allocation is on hold.

Regarding the assistance for nonprofits, the Community Foundation worked with Customers Bank to establish a temporary $2 million line of credit from which the Foundation is lending up to $200,000 per nonprofit during this crisis. Seven nonprofits have received, will receive or have applied for $1,035,000 from the program.

To qualify for the loan assistance program, organizations serving Berks County must:

  1. Have exhausted operating reserves and have insufficient lines of credit to continue service delivery during this crisis unless they receive assistance.
  2. Be a tax-exempt nonprofit under 501(c)3 of the Internal Revenue Code. Government agencies are not eligible for this loan program.
  3. Have contracts with the state or be able to show that they are not receiving funds for services due to the state budget crisis.
  4. Agree to pay a $200 loan origination fee.
  5. Pay back the loan in an agreed-upon time frame.

To inquire about applying for loan assistance, contact Heidi Williamson, vice president for programs and initiatives, at 610-685-2223 or heidiw@bccf.org.

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Berks County Community Foundation is a nonprofit corporation that serves as a civic leader for our region by developing, managing and distributing funds to meet existing and emerging community needs. More information is available at www.bccf.org.