Welcome to the Poorhouse: Relief Agencies Need Relief

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A big hole is ripping through the safety net, according to the Orange County Funders Roundtable, a coalition of local foundations that today released results of a countywide study that found 58 percent of responding nonprofits are facing declining revenues in 2009 and more than 66 percent are seeing a greater demand for services. "It's a perfect storm," says Michael Ruane, Children and Families Commission of Orange County executive director, of the study's conclusions. "Reduced donations, increased demand for services and the impact of the state budget crisis on the safety-net providers are putting incredible pressure on our local nonprofits."

The numbers are staggering:

-46 percent of surveyed nonprofits have lost granted funds and contracts that were anticipated;
-43 percent have major donors that were unable to provide continued funding;
-33 percent have already tapped into their reserves;
-and 13 percent are using lines of credit to sustain operations.

Increased demand for food, shelter and medical care by Orange County's newly poor is contributing to the strain on nonprofits, which report more requests for social services coming from first-time assistance seekers. Former two-income families are turning to food banks so they may feed their children. This must be addressed, the roundtable insists, because child abuse and neglect increase dramatically during times of economic distress. 
"It is critical that the public be aware of the dramatic new needs and challenges that the economic crisis brings to Orange County," says Shelley Hoss, Orange County Community Foundation president. "The local nonprofit sector plays a vital role in supporting quality of life in our communities. But the local nonprofit safety net needs reinforcement. There is an opportunity here for neighbors to help neighbors, for each of us to help, by giving our financial resources and our time."

Reuters news service's Dan Whitcomb reported earlier this week about food banks being swamped "in Orange County, which has been portrayed as an oceanfront playground for the wealthy on such TV shows as The O.C. and The Real Housewives of Orange County." (He forgot Arrested Development; they always do!)

Hunger relief groups report demand has increased 40 to 60 percent since June 2008. "Our donations have not in any way, shape or form kept pace with the skyrocketing need in Orange County," Mark Lowry, director of Orange County Food Bank, tells Whitcomb. "I've been here for over 20 years and while we've seen challenging times, I've never seen such a dramatic increase in need."

Indeed, the crisis has caused Lowry to do something that could be playing a part in the alarming Orange County Funders Roundtable numbers referenced earlier: he has stopped donating to any new organizations.

Previously in Welcome to the Poorhouse:

The Rise of the No-Tell Motel

Problem Makers Become "Solvers"

From My Bank to Your Ears

Ring-Ring-Ring!

A New Blog Series
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