Proposed South Orange Budget Reduces CCR, YouthNet Funding by Twenty Percent

South Orange trustees will vote on the budget, available here, on May 14.  That budget includes reduced spending on the two non-profit organizations that South Orange and Maplewood fund jointly, a decision made Monday after weeks of uncertainty.  

Both the Community Coalition on Race (CCR) and will see their funding from South Orange cut by 20 percent. YouthNet is slated to receive $12,000, and CCR is slated to receive $18,000.  The funding is contingent upon receiving service agreements, or contracts, from both agencies that are agreeable to the Village.   YouthNet has indicated that they are moving away from municipal funding from both Maplewood and South Orange. However, non-profit funding remains a hot-button topic – pro and con – for residents.  

As early as June 2010, discussions were underway about reducing municipal spending on non-profits.

 In June of 2010, Administrator John Gross was charged with finding cuts that would bring the municipal tax rate from 3.5% to 2%. 

At that time, members of the public expressed concern about continuing to fund a non-profit that's politically active. (CCR was visibly supportive of the controversial proposal to in the school district.)

However, Village President Doug Newman observed that the budgetary impact of withdrawing funding from a small non-profit would be enormous, and that the CCR has defended its advocacy work by contending that it doesn't meet the IRS definition for lobbying.

In September of that year, Village President Douglas Newman clarified the 2010 budget situation as it concerned the CCR, as well as other town-funded non-profit agencies. The , a ten-percent reduction from the previous year, and "entirely consistent," in Newman's words, with other Village endeavors.  

The issue of funding non-profits arose again in February 2011 at a public budget workshop.  Minutes approved on February 28, 2011 note a discussion of funding for the coming fiscal year. At that time, the CCR requested $22,500 in funding from South Orange. Chip Madsen, President of the Board for the CCR, Executive Nancy Gagnier, and Program Director Audrey Rowe were present.

Village President Newman recommended that the Village fund $22,500 with the proviso that a “service level agreement is executed by the parties and any in-kind service that may be provided by the Village i.e. office space, phone/internet service, would offset grant funding.” 

Trustees Gould and Goldberg made comments in support of “in-kind” contributions, such as office space.   Trustee Janine Bauer stated that she is not in favor of using taxpayer-funded money for non-profits. Trustee Howard Levison requested a service level agreement, and Trustee Mark Rosner cautioned that the CCR must move to zero funding from the Village in the future. Trustee Deborah Davis Ford supported continued funding. 

After what the minutes describe as “much discussion and public comment,” the board decided to appropriate $22,500 to the CCR in the 2011 budget “with the understanding that the grant funding would be reduced by the value of any in-kind service provided to the CCR by the Village.”

In his , Michael Goldberg notes,

At the March 3, 2011 budget workshop, the idea was proposed of providing physical space for the CCR in South Orange in lieu of financial support.

Minutes of the CCR’s June meeting notes that Executive Director Nancy Gagnier reviewed a draft proposal of the agreement between the agency and the Village, which was approved at that meeting.

During a , the BOT took a straw poll and agreed to cut funding to non-profit organizations.  CCR was discussed and the BOT decided to formalize an offer of “in-kind” services to the group in lieu of actual monetary funding. Specifically, the Board agreed to appropriate $22,500 in funding in the 2011 budget, less the pro-rated value of office space offered by the Village. The Board “further agreed that as of January 1, 2012, the Village would only be providing in-kind office space, plus telephone and utilities with no monetary funding,” according to minutes of the meeting.  “The Village Administrator was asked to inform the CCR and Maplewood of the Village’s funding position,” according to the same minutes.

At that meeting, Gross advised the Board that the CCR would ask for reimbursement of moving expenses and related costs, as part of the Village’s offer of in-kind services. Gross assured trustees that the Baird Center had available space for the agency, and noted that the CCR provided a service level agreement for the Village’s review.

Goldberg's blog post further notes, "At the July 18, 2011 budget workshop, that idea was agreed upon by a majority of the Board of Trustees. From the minutes of that meeting: "After much discussion, the Board of Trustees agreed to appropriate $22,500 in funding to the CCR in the 2011 budget, less the pro-rated value of office space offered by the Village as an in-kind contribution. The Board of Trustees further agreed that as of January 1, 2012, the Village would only be providing in-kind office space, plus telephone and utilities, with no monetary funding."  This was communicated to the CCR on July 20, 2011, in January 2012 and again via email on February 8, 2012."

Minutes of the August meeting of the CCR note that funding for 2011 was set, and “this would impact 2012 and beyond.” The agency asked for further details of the offer from South Orange, including a timeframe for the move.

In October 2011, an offer was extended to CCR that South Orange would house the Coalition in the Baird Center.  Included in the offer was a five-year lease for office space, liability insurance, and internet connections.  CCR’s Board of Trustees took a vote at their October meeting and rejected the offer with 14 nays and 3 abstentions.  There were no yays.

At the , following a question by Goldberg about why the Coalition would be presenting with other non-profits, Trustee Mark Rosner explained that no actual action had yet to be made to defund CCR since the budget hadn’t been passed for 2012. 

In November, the CCR sent a letter to Village President Torpey, further clarifying their position. The letter noted, “There is no offer of financial support. The Coalition Board has expressed grave concern over the constant threat of losing all financial support from the Village. Under these circumstances, the Coalition Trustees feel that it is not prudent to give up its current office space at this time.”

On Dec. 4, in an e-mail to then-Interim Administrator Reagan Burkholder and Chief Financial Officer John Gross, Goldberg asked for confirmation that the funding for CCR had been taken out of a proposed 2012 budget and asked if the Coalition would be accepting the in-kind offer.  Goldberg was assured verbally that the CCR had been removed from the budget.  However, two weeks later, Gross informed Burkholder in an e-mail that CCR’s funding had not yet been removed.

On Dec. 20, CCR Executive Director Nancy Gagnier submitted a draft budget and funding request to South Orange, addressed to John Gross. 

CCR’s budget included an expected $22,500 from South Orange, reflecting concerns expressed in the November letter to Torpey. In an e-mail to Gross, Gagnier said that "the acceptance of office space, insurance and internet connection was put on hold until the (CCR trustees) have a sense of whether there will be cash support in 2012 as well."

In 2012, members of CCR have been frequent visitors to BOT meetings to lobby for funding and support.  The CCR members concentrated on explaining the mission of CCR and the work they do around town.  However, the BOT stressed that the decision to defund CCR was never about the organization specifically.

“This was never about the mission of the Coalition,” said Goldberg.  “This was a financial decision, about doing things more fiscally responsible.”

At the same time, naysayers – though far fewer in number than CCR supporters - have raised questions about funding non-profit agencies, describing their activities as political.  The CCR, which hosts public events throughout the year focused on , , and celebrating Dr. Martin Luther King, Jr., also hosts a each spring.

ignited controversy.  The CCR explained why the question was posed to the candidate. Last year’s debate was marked by a and linking that endorsement to the forum. Members of the public charged, at recent Board of Trustee meetings and in comments on Patch blogs, that such activities are partisan and, therefore, make the CCR ineligible for municipal funding.  

During the deliberation about the funding in March, it  was revealed that YouthNet had yet to be informed of their impending defunding.  Due to that, Trustee Deborah Davis Ford stated her argument that it wasn’t fair to fund one and not the other.

“We are not going to fund one and not the other,” said Davis Ford.  “It is the perception of fairness.”

In April, Torpey stated that South Orange would be developing a policy about how to deal with non-profit organizations, no matter the size or service they offer.

“This should not be decided based on one organization or another,” said Torpey.  “We should decide as a policy about contracting for services with non-profits or for profits.  We should create that policy and then we should discuss how the application process works and how an organization can become part of that.”

During the 2011 both candidates, Torpey, and Janine Bauer said they wanted to cease funding non-profits. The 2012 budget will be voted on in May, non-profit funding included. As to future funding, the budget process begins for 2013 this fall. (The Village of South Orange calendar is here.)

Reporting by Scott Egelberg, Cotton Delo, and Marcia Worth.