Wednesday, February 16, 2011

NYCON CEO Doug Sauer Comments on Obama’s Proposed Budget Impact

WNYC featured an article on the proposed cuts from the Federal government and how they will impact nonprofits. NYCON's CEO Doug Sauer comments:

President Barack Obama's plans for cuts to domestic spending, as part of his $3.73 trillion budget for 2012, would directly impact local nonprofits that provide an array of social services. There would be less federal money to go around, and stiffer competition for a smaller pot of funds.

The proposed budget aims to slash $300 million, or 27 percent, from Community Block Grants, which fund affordable housing programs, infrastructure improvements and economic development projects.

“Nobody likes any cuts. The world we live in, it is clear, the federal government is going to spend less, state government is going to spend less and we have to find ways to live within that,” Mayor Michael Bloomberg said.

Bloomberg said the White House called him several days ago to give him advance notice about the president's budget. A mayoral spokesman said officials are also looking at the effect the president's budget would have on mass transit and education.

Bloomberg presents his budget proposal on Thursday.

The National Endowments for the Arts and Humanities were hit with more than 10 percent in cuts, leaving both with $146 million each.

"If you looked at the arts situation, added to what’s going on in New York state and what the governor proposed, government involvement in the arts and funding the arts has just been dramatically reduced, and this just kind of adds to that," said Doug Sauer of the New York Council of Nonprofits. He said the Obama budget would also make it more expensive for nonprofits to hire workers.

Arts administrators said nonprofits tend to be more reliant on their National Endowment grants as a way of building credibility with foundations and donors. Loss of those federal grants will make it tougher to get other money.

Sauer said the president's budget also cracks down on how businesses, including nonprofits, use independent contractors to fill out their workforce. “There’s an increase in the unemployment tax that you’ll have to pay, which is part of the extension of unemployment benefits," Sauer said. "And that’s hurting nonprofits or small employers just as much as it’s hurting the small businesses."

He predicted that a tighter federal budget, along with austere state and city budgets, will force some nonprofits to go out of business or to merge.

Obama’s budget includes $451 million for the Corporation for Public Broadcasting, but House Republicans want to cut funding to CPB entirely (Note: The Corporation for Public Broadcasting contributes more than $3 million to WNYC’s annual operating funds).

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