Leaders of nonprofit organizations that serve disabled individuals in the west metro have voiced opposition to the $1.5 trillion federal tax package expected to become law before the end of the year. They fear that the deficit created by the cuts would trigger reductions in programs that serve the disabled.
Among the nonprofits speaking out is St. David’s Center for Family & Child Development in Minnetonka. Julie Sjordal, executive director of the organization, explained that 80 percent of clients at the center are on some form of Medicaid—which, along with Social Security and Medicare—is an entitlement program that would be cut under the proposed federal tax bills.
St. David’s serves more than 2,000 children, adults and families throughout the west metro. The center offers preschool, pediatric therapies, autism day treatment, mental health services, in-home and community-based support for individuals with disabilities, parenting and more resources.
She said that the proposed tax bills would create a large deficit in the coming years, and as a result, it would be necessary to reduce government spending.
“Word on the street, from Speaker [of the House Paul] Ryan, is that after the tax bill is passed, he wants to address the federal deficit through cutting entitlement programs. That’s our biggest concern,” Sjordal said.
Between the many drafts and varying versions that the Senate and the House have proposed, Sjordal said there’s uncertainty whether or not the charitable tax deduction will remain or be cut under the proposed tax system. Charity donations support St. David’s annual budget.
“If the charitable tax deduction is not available to taxpayers anymore, then donors to organizations like St. David’s Center might not be as generous,” explained Sjordal.
According to Sjordal, who attended a Dec. 15 meeting where Congressman Erik Paulsen spoke, said Paulsen mentioned that the charitable tax deduction has not been taken out of the new tax system after all. But, she said, it has been seen removed in some versions of the bill.
“Paulsen said, ‘I’m not interested in cutting Medicaid for people with disabilities. Just because the speaker is saying that doesn’t mean I’m on board,'” Sjordal recalled of Paulsen’s comments. She said it was good to hear that statement.
If federal funding is cut, Sjordal said the state may or may not make up for that funding.
“If [the state] can’t, then services will be cut,” Sjordal said.
Nevertheless, Sjordal said she, and other organizations, will keep advocating.
“We’re crystal clear in what our community needs from us,” she said. “We have some battles to fight to keep services in place for our most vulnerable citizens.”
Minnetonka nonprofit Opportunity Partners has also voiced its opposition to the federal tax bill. The organization provides job training, employment and independent living support for people with disabilities such as autism, Down syndrome, cerebral palsy, brain injuries and fetal alcohol syndrome.
Another nonprofit raising concern is Hammer Residences, a Wayzata-based organization that supports nearly 1,300 individuals with developmental disabilities throughout the western suburbs of the Twin Cities. The organization’s settings of care include 37 group homes, 10 apartment programs and in-home services.
Hammer’s primary concern is focused on potential reductions to Medicaid to help pay for the tax cut.
“We support 275 people in our residential programs. … And of that, 274 of them receive their funding from Medicaid,” said John Estrem, CEO of the organization. “So obviously it would have a huge impact for the people we support and their ability to get the supports that they need.”
Estrem said the potential impact could force changes at Hammer down the line, including less funds for staffing at homes and apartments.
“Our biggest cost driver is staff. ... Staff is there 24 hours a day, seven days a week,” Estrem said.
In a typical group home with four residents, there would be two staff members there during peak hours to allow the group to split up for different activities. Reducing the house by one staff member, Estrem said, would mean that residents might have to choose between staying home or going out.
“It would mean a lot less choice about how people spend their time,” Estrem said.