The Sacramento Children’s Home is committed to creating stable and safe home environments for families in the Sacramento region. I see firsthand the struggles when parents can’t make ends meet, and how financial pressures can spiral into overwhelming challenges.
Raising the minimum wage will help many families have an easier time paying their bills. But raising the minimum wage also has unintended consequences. The business community has its concerns, but the impact to nonprofits hasn’t been told.
As the head of the Sacramento Children’s Home, I want to pay higher wages so that I can hire, and most importantly retain, qualified staff. Our staff provides shelter, stability, counseling and other critical services to thousands of children and families each year.
These children often lack a safe family environment, and they become very attached to Children’s Home staff. Being able to retain skilled counselors, therapists and educators who provide a nurturing environment is a critical part of our community impact.
But the Sacramento Children’s Home operates on a very modest budget, and we do not charge for any of the services that we provide to the more than 6,200 children and 4,600 families that we serve each year. We cannot simply raise the cost of our services – since they are free – to meet this gap.
With the new minimum wage law comes a responsibility for lawmakers to recognize the financial burden this will place on nonprofits. And the state needs to step up to the plate to address this new reality.
As part of the 2011-12 budget, the Legislature enacted a major shift of state programs and revenues to local governments to fund social services and mental health, among other programs. The mechanics of this realignment changed the way nonprofits receive funding and has made it more difficult to weather changes in statewide policies like a minimum wage increase. We are also affected by changes at the federal level, and President Barack Obama is close to finalizing proposed changes to federal overtime payment limits, raising the salary threshold for overtime pay to $50,440.
Raising the threshold for overtime pay and the minimum wage also drives up wages for exempt positions, which must be paid double the minimum wage. The problem is that we are not receiving additional government funding to meet this increase in expenses. And at the same time we are not willing to compromise the depth and breadth of the services that we provide or turn away those who depend on us to turn their lives around.
Through eight programs at six sites in the county we provide prevention, early intervention and treatment programs to stop the generational cycle of child abuse and neglect. For nearly 150 years, we have been dedicated to caring for our community’s most vulnerable residents, and we are committed to our mission now more than ever.
In order to get by we are more dependent on corporate and community support to sustain our programs. Without the support from businesses and individuals in our region, the need for additional government funding would be even more drastic.
As legislative leaders and the governor consider the budget for the coming year – and future years – there must be adequate funding for social service and mental health programs. All of the programs at the Sacramento Children’s Home depend on government funding, and our current grants and funding streams will not cover an employee making $15 per hour, nor will they cover increased salaries for nonexempt employees.
California policymakers decided that minimum wage was a priority for the state. We don’t disagree, but they need to back the play.
Roy Alexander is the chief executive officer of the Sacramento Children’s Home. Contact him at firstname.lastname@example.org.