Judgment Day For Nonprofits

July 1 is a painful day for many who serve the community

By DAMIAN TRUJILLO

Updated 5:33 PM PST, Wed, Jul 1, 2009

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Kent Wilhoite

There's a red "Easy" button on Patricia Gardner's desk. But there's nothing easy about the numbers Gardner's been crunching as the head of the Silicon Valley Council of Nonprofits.

Her agency represents 200 nonprofit agencies across Silicon Valley. "46 percent of our agencies are laying off," says Gardner. "Fifty three percent have cash flow problems."

For them, July 1 is Judgment Day. Most nonprofits start their fiscal year today, in sync with local and state governments. Even those on different calendars have to deal with an end to funding for their programs in June. That means that cuts they feared making had to be made by today.

For Patricia Chiapellone, who heads San Jose's Alum Rock Counseling Center, it meant eliminating one of its truancy reduction programs and the successful Evening Reporting Center, where kids who have been released from juvenile hall go for rehabilitation.

But just as painful for Chiapellone was telling five of her staff members she couldn't afford to keep them.

"It was devastating," said Chiapellone. "Absolutely devastating. I haven't had to lay anyone off in years and went through a training called 'how to lay off with compassion'. There's no way."

At the Boccardo Family Shelter in San Jose, administrators may have to drastically reduce the number of emergency beds they offer every night, from 250 to 100.

The center's director, Jenny Niklaus, said, "I'm presenting a budget tonight to my board of directors that has red ink, but looks at cuts that have to happen in the next two months to get to a place where we're balanced."

All nonprofits know even more cuts could be on the way. With the state budget debate still ongoing, many wait to see how much California lawmakers will raid local coffers to balance their own budget. Judgment Day has arrived. But nothing is getting easier.