Despite the recent amendment to Flagsta’s minimum wage law, reducing the wage hike to $10.50 in July instead of $12, the leader of one nonprot service provider in the city said he is “still bleeding, just bleeding more slowly.”

Armando Bernasconi, the CEO of Quality Connections, which provides job training and other services for people with disabilities, said the change to Prop. 414 was “a huge relief” but that the further increase to $11 in on Jan. 1, 2018, will leave his organization’s budget short.

“The feedback we’ve been getting from the Legislature is, ‘Flagsta, you’re on your own,’” Bernasconi said. All of the organization’s plans are contingent on state support, which Bernasconi said has been underfunded historically. With a higher minimum wage in Flagsta, the gap between costs and revenues will be even wider.

Quality Connections does have some of its own commercial operations that help sustain the organization, so it is not solely dependent on Medicaid funding, he said.

However, Bernasconi said, if the organization does not see a signicant increase in funding before 2022, when the city’s minimum wage is scheduled to reach $15.50, services and jobs could be cut.

“At $15.50, without any (extra) state money or any city money, we would not have a residential program and possibly a day program,” he said.

Closing the programs would mean about 65 sta members would lose their jobs and about 50 clients would be left without residential or day programs, he said.

The amendment, which was approved March 21, will “allow us to limp along for the next nine months,” he said.
The services Quality Connections provides are still in jeopardy, and he and other local providers are looking at dierent options, he said.

Bernasconi said he still believes Proposition 414 is “broken,” but he does not know of a clean way to x the ordinance. He said it is up to the state to fund nonprot organizations for the state’s minimum wage, but “414 is a Flagsta problem, so $15.50 is as much a Flagsta problem as it is a state problem.”

The organization continues to talk to the city council, minimum wage groups in Flagsta as well as Gov. Doug Ducey and the Legislature, Bernasconi said.

“This is not great legislation, like some say it is,” Bernasconi said. “Great legislation does not ostracize the people it is trying to help.”

BREATHING ROOM

Donald Harrington, the assistant director for Community Provider of Enrichment Services (CPES), said the amendment gave the organization “breathing room,” and enough stability to sign a lease on a group home that had expired. The company would not allow for another Flagsta lease until after the amendment to 414 had passed the council, he said.

If the council had decided not to amend the law after declining to hold a special election in May, Harrington said the organization would have left the city.

“We would probably have stayed a month to try to relocate clients, but we would have looked at moving to Phoenix or Winslow,” he said.

However, Harrington said the additional increases and the uncertainty that comes with the November 2018 election regarding the minimum wage leave nonprot organizations with lingering questions and an inability to plan more than one year in advance.

CPES serves about 11 clients in Flagsta and employs between 40 and 45 people at any given time and operates three group homes and a day center, Harrington said. Clients in the homes require around-the-clock support.

“The people who are suering the most are the ones who can’t care for themselves,” Harrington said, adding that moving the clients to Phoenix or another city would remove them from family, which can be very detrimental.

Harrington said there is not a denitive minimum wage that would force CPES out of Flagsta, but when the city’s minimum wage is greater than 50 cents above the state’s, the organization will be in trouble.

“The breaking point is when we separate beyond 50 cents,” he said.

The organization has already implemented cost-saving measures, including buying food and other household items in bulk instead of buying from local stores.

If CPES does not expect Prop. 414 to be either negated or permanently amended in the November 2018 election, when at least one initiative will be on the ballot to change the law, Harrington said the group will look at leaving the city.

“We will develop our options long before the election,” he said.
Harrington said caregiving is a calling for people, and people who love it do not do it for the money. “I’m married to this kind of work,” he said. “If you do it for the money, you’re not going to last a week.”