No budget, no payment

Local businesses, agencies that depend on state funding are feeling the pain

Milta Aguilar-Tuel pauses to visit with her 3-month-old nephew, Charlie, at her south Chico home, where she operates an eight-child family daycare facility that is in danger of shutting down because of the state budget stalemate.

Milta Aguilar-Tuel pauses to visit with her 3-month-old nephew, Charlie, at her south Chico home, where she operates an eight-child family daycare facility that is in danger of shutting down because of the state budget stalemate.

Photo By Andrea Lavoy Wagner

Deal in the works: Legislative leaders and the governor have announced they’ve reached a deal that could break the budget logjam, but first it has to be approved by the Legislature. For more information on the proposed state budget and current updates, go to the governor’s website at

As California legislators grapple with a record-long stalemate over the budget, Chico resident Milta Aguilar-Tuel has been waiting cautiously and anxiously for a decision that could save or cripple her financially.

Aguilar-Tuel may face foreclosure and having to tell eight families to find somewhere else to go for child care.

Her 900-square-foot home off Laurel Street is also her business, a small, licensed daycare center in south Chico. It’s the only such facility in the neighborhood and one of few Spanish-speaking child-care providers in Butte County.

During a recent interview, Aguilar-Tuel spoke about her predicament candidly as she looked out into a yard with a rusted Radio Flyer wagon, a plastic, yellow shovel and some toddler slides behind a white-picket fence. “I would love to give Schwarzenegger a piece of my mind,” she said, referring to the governor and other politicians wrangling in Sacramento. “They don’t see how us normal people live.”

Aguilar-Tuel has not received a state paycheck since July 1. Like hundreds of organizations who rely on funding from the state, hers has gone for months without reimbursement.

“As much as you want to help the parents and families, it’s hard,” she said.

Many of the families Aguilar-Tuel serves are clients of Valley Oak Children’s Services, a nonprofit Chico-based child-care resource and referral agency that pays for child-care services for families approved through a low-income-eligibility process. The agency is responsible for allocating almost $700,000 per month to Butte County child-care providers.

The budget stalemate, stretching more than three months into the fiscal year, means that since July no money has filtered down to county agencies and individuals who depend upon those organizations.

Valley Oak is one of many agencies in the state that are facing cuts, waiting on contracts and wondering if they will be open after December. Some say they can hold on past the holidays, but not much longer.

“Everyone’s just waiting on pins and needles once more,” said Joe Copery, director of Passages, a nonprofit program serving senior adults and their caregivers.

So far, because of Passages’ relationship with Chico State’s Research Foundation, which channels grants and contracts to the program, Passages is “holding out,” Copery said. It can possibly stay open through December.

However, federal dollars promised for the program are also being withheld because the funds must first pass through the state. The delay means Passages’ subcontractors, such as the Senior Nutrition Program, which feeds an average of 7,700 meals a month to elder adults, are not getting paid.

Additionally, Passages has had to halt things like a respite-care program that pays for substitute caregivers for up to four hours a week to give much-needed relief to people who care for seniors at home.

Over at Enloe Medical Center, Mike Wiltermood, its CEO, said the region’s largest health-care provider is secure for now.

The private health-care providers who accept Medi-Cal insurance are the ones in a “tough spot,” he said. “It’s bad enough that Medi-Cal doesn’t pay what it costs to care for people, but now they’re not getting anything,” he said.

Any facility or doctor accepting Medi-Cal has not been paid since July. Some providers refuse to take Medi-Cal because of regular delays in payments. The ongoing cuts in psychiatric care and substance-abuse programs are sending more people through the emergency rooms, Wiltermood said.

While the hospital is holding on, it’s definitely feeling the pinch. “It takes $1 million a day to stay in business,” he said. “When 24 percent [of revenues] is Medi-Cal, it’s tough.”

Because of previous budget cutbacks in the last three years, Valley Oak Children’s Center has already taken measures to keep afloat, such as closing its Oroville office, laying off 14 staff members, and putting some staff on furloughs. However, this year is the worst yet, said Karen Marlatt, the agency’s executive director.

It is not just a question of when the budget is signed and the contracts are renewed. It is a question of “if,” she said. Gov. Schwarzenegger’s proposals from May included cutting many child-care programs, including Valley Oak.

If Valley Oak closes, 41 full-time jobs and more than $2 million in taxable income will be lost, Marlatt said. In addition, 903 Butte County families with 1,480 children would lose child-care funding. Of those families, 204 include parents employed in the health-care system, she said.

For now, Valley Oak is keeping the services it can afford while cutting such things as office cleaning services and reducing employee retirement benefits. It’s also encouraging clients to send letters to lawmakers.

The stalemate has not only put funding on hold, but also caused a chain reaction that has trickled down to families who need child care to be able to work, Marlatt said. Child-care providers aren’t getting paid, and some have stopped providing care. This has left some parents scrambling for alternatives and perhaps losing their jobs or only working part-time. Some parents are getting unemployment benefits or public assistance for the first time now because they cannot afford child care.

“It’s really sad that the whole system is kind of frozen right now,” Marlatt said.

Meanwhile, Aguilar-Tuel and her family will try to manage. Parents, some of whom work in fast-food restaurants or on farms, continue to bring their children to her home, while Aguilar-Tuel sees no reimbursement.

“If Valley Oak shuts down, I’m done,” she said. “As much as I want to, I can’t go on.”