May 21, 2009 | Read Time: 5 minutes
Charities that provide food and shelter have been facing greater demands for their services since the recession began, and many have struggled to cover their costs. Now the federal stimulus law is about to send organizations government aid to to pick up some of the tab.
Congress provided $100-million in the stimulus package to the Emergency Food and Shelter Program, a 26-year-old effort that relies on 2,500 local boards to distribute money to charities that meet basic needs. Those dollars come on top of a $47-million increase Congress approved for the program’s regular operations in 2009, allocating nearly $200-million.
The program’s national board, governed by charities such as the American Red Cross, Catholic Charities USA, and United Way of America, is encouraging the local boards to look beyond the groups they have traditionally supported to find charities that are assisting people who are struggling financially, perhaps for the first time, because of the severe economic crisis.
Counting the stimulus funds, many local boards will have nearly twice as much money to distribute this year as they had in 2008. The boards will begin to distribute money to charities this month.
‘Ringing Off the Hook’
In Oakland, Calif., the local board is considering providing funds to charities that help people pay their utility bills — something it has never done before. In New York City, the local board is considering giving more to groups that focus on financial literacy.
“The phone is ringing off the hook,” says Al Acosta, director of community investment at the United Way of Greater Houston and a member of the local board there.
Charities that previously applied for a grant from the program this year will generally be able to file a simple one-page application. Local boards are expected to file their plans for using the recovery funds by the end of May, which means that deadlines for charities applying for money will pass soon.
Charity leaders are happy that more dollars are available, but some are chafing at the tight deadlines that have been set for spending the money.
All of the stimulus funds must be spent by the end of the year, and local boards have been instructed to abide by spending deadlines they set for the regularly appropriated funds.
In Houston, that means all money must be spent by the end of September, although Mr. Acosta is pursuing an extension to November.
“It’s sort of like you’re feasting and then it’s famine time,” says Yolanda Gutierrez, director of the basic-needs program at Catholic Charities in Houston. “It would be good if we had more time to use those funds.”
National officials say that getting resources into cities and towns quickly is the best way to help people who have been hurt by the recession.
In Houston the number of families requesting food or rent assistance from Catholic Charities has risen more than 25 percent over the past year, but Ms. Gutierrez says the charity’s ability to distribute food is limited because its food warehouse has only 1,000 square feet.
Catholic Charities got $42,000 through the program earlier this year. Ms. Gutierrez says the group will probably request only $10,000 in stimulus funds because of the lack of space for food and the tight deadline for spending the money.
Plenty of charities say they will have no trouble absorbing the stimulus funds. Shelter Inc., of Contra Costa County, which serves a hard-hit suburban area near San Francisco, has seen demand for its rental-assistance program nearly double over the past year, to 6,000 people.
“What’s exciting with the stimulus package is here is an opportunity to address an immediate critical need that is just exploding,” says Timothy O’Keefe, the charity’s executive director.
Shelter Inc. received $150,000 from the Emergency Food and Shelter Program earlier this year, and the charity’s overall budget (it also operates a family shelter) rose 25 percent for the 2009 fiscal year, to $6.1-million. Mr. O’Keefe says he hasn’t decided how much of the stimulus money he will seek.
Contra Costa County received $330,000 in stimulus funds through the program. While Mr. O’Keefe says he could easily distribute that entire amount, he is likely to receive only a fraction of it — which means he will continue to turn away some people who seek assistance.
Most of the stimulus funds would go to the charity’s rental-assistance program, which typically provides help for only a month or two.
“We help the poorest of the poor and put a priority on helping households with young children,” Mr. O’Keefe says. “After that, the chips fall where they may.”
Local Boards
The Emergency Food and Shelter Program was created in 1983, with an appropriation of $50-million. During its history, the program has distributed a total of $3.3-billion.
The funds flow through the Federal Emergency Management Agency, but the national board and the United Way of America distribute the money to local boards using a formula based on unemployment and poverty rates.
Jim Franz, a member of the local board for Alameda County, in California, says the board is urging charities to team up to provide assistance with utility bills, in much the same way that three charities already provide rent assistance in the large county. “The charities would have to demonstrate that their partnership is set up so that folks throughout the county could access the program,” says Mr. Franz, director of community services for the American Red Cross Bay Area.
As they look toward 2010, some members of the national board are lobbying to maintain spending on the program at $200-million or more.
“We want to protect the $200-million base,” says Steve Taylor, vice president and counsel for public policy at the United Way of America and the charity’s representative on the national board. “But we also want Congress to know we’re able to handle more if they want us to.”
