FPWA presents: New study finds NYC faced a fiscal cliff as COVID-19 relief funding expired

FPWA has released its 2023 Human Services Funds Tracker report, which provides a comprehensive funding analysis of New York City’s human services agencies over fiscal year ‘22. Previously launched in 2019 as the Federal Funds Tracker, the newly expanded tool monitors state and city funding to provide a holistic account of the sector’s fiscal health. The timing of this year’s report is critical as federal and state support hit their lowest in over 10 years. FPWA has released a video explaining these findings, with more detailed videos forthcoming.

The report comes as Congress recently passed the Fiscal Responsibility Act, raising the potential of nationwide disruptions to human services by cutting COVID-19 funding and enforcing stricter work requirements for SNAP and TANF recipients. These new provisions will hinder human service agencies’ ability to adequately address poverty.

FPWA’s 2022 report examining FY21 cautioned that the city faced a fiscal cliff as COVID-19 relief funding expired. New York City has now hit this cliff, straining to fill the gaps of a combined 22.9% decrease in federal and state dollars to its city agencies. The 2023 report signals the detrimental impact of future budget cuts to this fragile and yet essential sector, a timely warning given the city’s upcoming fiscal year ’24 budget. It underscores the necessity of the city, state, and federal governments working together to ensure New York City’s human services are sufficiently resourced to deliver the vital services that so many rely on.

“Today, we announce the release of our much-anticipated Human Services Funds Tracker report. For several years now, we’ve been drawing attention to the impending fiscal cliff that would be caused by the expiration of Covid-19 funding. That cliff is now upon us, and our research reveals that fiscal year 2022 saw the lowest state and federal funding levels for key city agencies in over a decade,” said Jennifer Jones Austin, CEO and Executive Director of FPWA. “Funding to New York City’s human services sector was reduced across the board, and we only anticipate further shortfalls. Human services provide critical lifelines to many New Yorkers and with need in our city at an all-time high there could not be a worse time for further cuts.”

Jones-Austin also said: “Given the fragile fiscal landscape outlined in our report, we implore the city to ensure there are no further cuts at the city level as part of the fiscal year 2024 budget. The strain has reached its breaking point with nonprofits closing and at risk of closing, and people in need going without critical assistance.  We urge the city, state, and federal government to carry their fair shares – all three levels of government are responsible for this crisis that won’t just go away. We call upon our legislative partners in the Assembly, the House, and in the New York Congressional Delegation to raise this issue loudly and often. Now is the time to heed these warnings as economic deprivation looms over our city – the most populous in the country. New York City leads the country on many fronts, including in the care of its people. New Yorkers and indeed, all people, deserve responsible funding to meet these fundamental needs today.”

“FPWA’s Annual Human Services Fund Tracker continues to demonstrate that state and federal spending on human services delivery and benefits alike have not kept pace with significantly greater living costs,” said Sen. Roxanne Persaud, chair of the state Senate Social Services Committee. “Eroded funding levels negatively impact not only those who rely on various social safety nets, but also the workers who dedicate their lives to helping others. We need serious greater investments across the board; neither clients nor workers can make ends meet.”

“The same financial crises that have hit New Yorkers in recent years have also greatly impacted our city’s human service agencies, at a time of desperate need,” said Assemblymember Linda Rosenthal, chair of the Assembly Committee on Housing. “With high inflation and stagnant wages, families have been finding it increasingly difficult to pay their bills and put food on the table. Yet, as the need for assistance grows, our human service agencies are bereft of funding, as revealed in FPWA’s Human Services Funds Tracker. The services offered by human service agencies are the first line of defense in times of need. FPWA’s eye-opening report is required reading that will hopefully spur greater funding for the organizations that tend to the needs of so many New Yorkers.”

“As Chair of the New York State Assembly Social Services Committee, I am deeply troubled by the findings of the FPWA’s annual Human Services Funds Tracker. This report exposes a stark reality: the erosion of agency funding over time, coupled with stagnant state and federal funding levels, has resulted in a significant decline in the real value of the funding received by our human services agencies. The inability of these agencies to keep up with inflation threatens their ability to effectively serve our most vulnerable communities. It is imperative that we address this funding gap and prioritize the well-being of our constituents by ensuring adequate resources are allocated to support the critical services provided by our human services agencies,” said Assembly Member Maritza Davila.

“The health, safety and well-being of our city, our communities, and our economy are all bound to how well the budget invests in essential human services,” said New York City Council Speaker Adrienne Adams. “FPWA’s new 2023 Human Services Funds Tracker report reveals that city agencies have suffered from a 22.9% decrease in federal and state funding from FY 21 to FY 22. City agencies testified at our budget hearings that they already don’t have the resources to effectively respond to the multiple crises facing our city. Human services offer an essential lifeline for New Yorkers, and we must ensure the sector is funded so all New Yorkers have what they need to succeed. This requires the city to make the necessary investments of city funding and to identify new sources of support, including from the state and federal government.”

“Our office has worked closely with FPWA over the years and stood with them on many human rights issues that affected all New Yorkers,” said New York City Council Member Nantasha Williams. Their Human Services Tracker annual update is another reminder on how governments at all levels do their part to support life-sustaining services. I join with them as we call on our federal and state partners to carry their fair shares of the investments in our critical human services system.”