Congress’ recent debt deal likely to hit Nashville’s social services

Sunday, August 7, 2011 at 10:05pm
By Steven Hale
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U.S. Rep. Jim Cooper, D-Tenn. 

It’s a little quieter now on Capitol Hill, after President Barack Obama last week signed into law a debt ceiling increase. It put an end — albeit temporarily — to months of political bickering, played out in daily floor speeches and multiple interruptions of primetime network television. The 11th hour deal sent members of Congress to a monthlong recess and the President to a fundraising celebration of his 50th birthday. 

But now, social-services providers in Nashville and around the country must wait while the effects of the deal trickle down. No one is yet sure how the weight of the deal’s spending cuts will be distributed, but here, federally funded agencies aren’t expecting their burden to be light. 

That’s because the deal struck in Washington looks to have rather one-sided results, locally. The long-sought agreement raised the debt ceiling by $400 billion and mandates $917 billion in spending cuts by way of discretionary spending caps over the next 10 years. The deal did not include any of the revenue increases the president and Democratic leaders had at one time insisted upon. 

U.S. Rep. Jim Cooper, D-Tenn., explained his support of the final deal in a news release last week, saying he voted for the legislation “because it protects America from default and starts cutting unnecessary spending.” 

“Much more needs to be done,” Cooper said, “but Congress has finally stopped bickering and started solving our deficit problems.” 

In an email to The City Paper, Cooper spokesman Peter Boogaard said it’s too soon for specifics about what the deal means for Nashville. 

“This bill set spending caps, but the allocation of resources still lies with the committees of jurisdiction,” he wrote. “It is just too early to tell how Nashville will be affected.” 

If Nashville’s social-services providers see a decrease in federal funding — and it seems likely they will — it could do real damage to the breadth and depth of services they’re able to provide, particularly for those still reeling from budget cuts earlier this year. 

“We’re in a really hard spot,” said Julie Oaks, spokeswoman for the Metro Development and Housing Agency. “We know we’re probably going to have future cuts, but we really don’t even know, in some areas, what the previous cuts mean quite yet.”

Those cuts, brought by the budget Congress passed in April, meant that MDHA had to lay off eight employees. There were reductions in funding for community development programs and the housing choice voucher program, commonly known as Section 8. As a result, Oaks told The City Paper, 4,200 of the 5,800 families who receive a rental subsidy from MDHA will see a decrease in that assistance. 

Furthermore, Oaks said, MDHA has not issued a Section 8 voucher in the past six months and hasn’t taken a new Section 8 application since 2008. There are 670 people on the waiting list. 

As the agency adjusts to an already reduced budget, Oaks said MDHA is bracing for more of the same. 

“We don’t have a crystal ball, and we don’t know exactly what we may face in terms of cuts. But I think it’s fairly certain that Housing and Urban Development programs are going to absorb some of these budget cuts, and since that’s where our funding comes from, we’re trying to be as prepared as we can,” she said. “The reality is that further cuts could potentially impact the number of families that we serve.”

The average family living in Section 8 housing has about 2.5 children, similar to the figure for the typical American family. The average income of a Section 8 resident, on the other hand, is about $10,000 per year. Oaks repeatedly called it “very unfortunate” that whether funding decreases hit MDHA or any number of other social service providers, those families will most likely be affected. 

Lisa McCrady, spokeswoman for the Nashville Metropolitan Action Commission, echoed Oaks’ concern about the seeming inevitability of reduced funds. She said her agency doesn’t anticipate losing any staff.

“What we’re hearing is that our community services block grant might be cut in half [from $800,000 to $400,000],” she told The City Paper. “We are very, very concerned about the possibility of that particular funding being cut.”

The commission provides a number of services for Davidson County residents through the federal block grant funds, including GED and college prep courses, rent and mortgage assistance and property tax assistance for seniors, as well as a homeless prevention program that pays utility deposits for individuals just coming off the streets. 

Like MDHA, McCrady said the commission is in a “wait-and-see pattern,” and they’re doing their best to prepare for the worst. 

“We are considering various scenarios, but because it literally can change overnight … it’s still too early to put [the size of potential cuts] down in stone,” she said, adding that they’re working with the Tennessee Association of Community Action, as well as a national network of community action agencies, to see what other agencies and other states are considering.

But the question, Oaks and McCrady believe, is not whether cuts will come to Nashville’s social services but rather how deep they will be. The end of congressional recess and the formation of a “Super Committee” made up of six Republicans and six Democrats who will determine what happens next in the ongoing drama will soon put an end to the relative quiet in Washington.

For now, Nashville’s social-services agencies — and the families lined up at their doors — can only wait and listen.