Nonprofits that service the elderly, disabled and poor are fearful that many of their grants and donations could dry up as a result of the infamous "fiscal cliff."
"It's a scary time, for sure," said Ginger Lee, president and chief executive officer of Community Works, a local nonprofit that provides services for domestic abuse victims and at-risk youth.
Community Works, like many organizations, relies heavily on government grants to pay the bills, along with donations and other community support. It receives about 80 percent of its $4 million annual budget from grants.
The cuts to nonprofits could have potentially far-reaching effects, though there are still many unknowns depending on how Congress and President Barack Obama handle the fiscal cliff, which is a shorthand term used to describe an array of automatic budget cuts and tax hikes scheduled to take effect at midnight on Dec. 31.
"The ramifications of the fiscal cliff and its impact in Oregon would be particularly severe," said Max Williams, president and chief executive officer for The Oregon Community Foundation.
The foundation provides $5.6 million in grants annually to numerous Southern Oregon organizations, such as Kids Unlimited, the YMCA and Community Works.
Williams said that if the federal government allows the fiscal cliff to come into reality, federal and state grants would dry up.
Because human service programs would be cut, the nonprofits would find themselves picking up the slack.
One federal proposal is to cap the amount of charitable deductions a potential donor could claim. Williams said this would discourage large donations, which would affect the amount of grants disbursed to his own organization and others.
Williams said some financial analysts have predicted a return to a recession if the federal government doesn't prevent the fiscal cliff from happening.
"It's a triple whammy for nonprofits," he said.
Williams said he's also concerned about the level of donations this year, because 44 percent of his contributions come during the last six weeks of the year.
Dee Anne Everson, director of the United Way of Jackson County, said nonprofits are already hurting, but the impact of fiscal problems in Washington, D.C., could make things far worse.
"We are cutting into connective tissue," she said. "All of those programs that help people in this country who are in need are in real danger."
United Way depends entirely on donations for its $1 million annual budget that funds 52 programs, such as the Rogue Valley YMCA, Kids Unlimited and the Family Nurturing Center.
She said nonprofits have had difficulty creating long-range goals in recent years because of the federal impasse over budgets.
"How do you plan for tomorrow, or for three to five years?" she said.
Jackie Schad, executive director for ACCESS, which helps local families with food, energy bills and housing, said that if the automatic cuts take place, "there would be no question that there would be massive cuts to social services."
Under one farm subsidy bill under discussion, the impacts to the food stamp program would be huge, Schad said. She said one projection indicates 88,000 Oregonians would be knocked off the program.
Schad said the economy has been improving, but the need for services hasn't leveled off or declined this year. She said it's too early to get hard numbers, but the food pantry program has continued to see an uptick in customers.
At this point, Schad said, it's difficult to speculate on the impacts to ACCESS because there are so many unknowns with the federal government.
"Nobody's talking real specifics yet," she said.
Reach reporter Damian Mann at 541-776-4476 or firstname.lastname@example.org.