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CDS faces financial crisis

CDS faces financial crisis
They look forward to it every year, but this year, for the first time in three decades, the clients of Community Developmental Services were unable to attend the annual West Tennessee Spring Dance, held last Thursday night in Jackson.
At least 1100 people attended the dance, held at the West Tennessee Fair Grounds, but 150 clients and staff of CDS – a community-based, nonprofit organization in Martin serving the needs of developmentally disabled adults in Northwest Tennessee – were conspicuously absent.
“The dance is the social event of the year,” says CDS Executive Director Cathy Cate. “Our folks anticipate it all year long, and this is the first time we’ve ever not been able to take them.”
CDS is also skipping out on its annual participation in the state’s Special Olympics, being held this weekend in Nashville, and has made the decision to reduce its upcoming summer camp from four nights to one – all because of recent financial pressures.
“We can no longer afford to pay for the overtime of our staff, and for all the gas it takes to participate in these events,” says Cate.
In January, Tennessee’s Division of Mental Retardation Services enacted a 6.1 percent payment reduction to community providers caring for some of Tennessee’s most vulnerable citizens. The cuts, intended to last through the end of June, have translated into a $13,000 per month loss for CDS.
“To get itself out of debt, DMRS is putting the agencies in debt, and the people we serve at risk,” says Cate.
CDS and other community mental retardation providers were already coping with rising costs of food, fuel and health insurance, without corresponding increases in funding from DMRS, when the 6.1 percent payment reduction was announced last December.
“We already operate on a pretty lean budget, so there truly are not a lot of areas where we can cut back to save money,” Cate says. “Even with the new measures we have put in place, we are still operating at a significant deficit. The cuts are putting our agency into a debt so large we wonder if we’ll ever be able to dig out of it.”
Compounding the problem for CDS has been a drop-off in donations from local community members and organizations. Civic and faith-based support has declined over the years, says Cate, as has the money CDS has been able to raise through its annual fundraising campaign, the Telethon of the Stars.
Taking all things into account, CDS’s deficit, in March alone, was $26,131.
The precarious financial situation of CDS is not a reflection of its management, says Steve Singleton, of DMRS’s office of finance, who spent two days recently with Cate and other CDS staff reviewing the financial situation and organizational structure of the agency.
In a May 9 report, Singleton calls CDS a “lean and well-organized agency,” with administrative costs “well under the established limits.” Singleton concludes, “It appears that the 6.1 percent cut in January has been a major contributing factor leading to the current financial status [of CDS].” Singleton also names the “dramatic increase in transportation costs” as a contributing factor.
“Until now we have been reluctant to let people know about the catastrophic situation of our finances,” says Cate.
“But we’ve decided that it’s time to inform people of the plight we are in. I think most people think we’re doing okay, because we’ve been around such a long time. But we’re not.”
State Rep. Mark Maddox, a longtime board member of CDS, has taken up the fight to recoup the losses imposed on community providers by DMRS. Maddox, whose sister Janet is also a CDS client, is sponsoring an amendment to the appropriations bill that would return the 6.1 percent that has been taken away since January.
One positive development, announced Tuesday, is that CDS and other agencies, who were expecting a 6.1 percent rate reduction for May and June, will now be getting 100 percent of the funds due to them for services rendered during these months.
But even if Amendment 175 passes, and the remaining funds are returned, CDS faces an uncertain future. DMRS informed providers, also on Tuesday, that beginning July 1, there will be permanent average daily rate reductions for all service reimbursements, but has not told the agencies how much.
If things don’t improve, this time next year CDS clients could be missing more than just the annual West Tennessee Spring Dance or the Special Olympics.
“It’s really hurtful to face potentially losing a program that we have worked so hard for 37 years to build up. To know that we’re in such jeopardy, facing closure, and not knowing what would happen to the clients we serve, especially the 60 of those who live with us because they have nowhere else to go.”
WCP 5.15.08