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Nonprofit Leaders Push for Workers’ Wage Equity

Leaders put pressure on local governments and weigh possible bond measure

Nonprofit leaders are looking for ways to continue providing local services, like meals to seniors, while paying employees fairly. PHOTO: GINA ORLANDO

Alma Molina knows what can happen when community services are lacking. 

Molina, the assistant director of Meals on Wheels for Santa Cruz County, was drawn to work at the nonprofit because her grandfather passed away due to a lack of proper nutrition, she says. 

She’s worked in the local nonprofit sector for nearly 18 years. To advance to her current position, she attended the University of Phoenix online while working full-time. She graduated in 2016 with a bachelor of science degree in management, but her career advancement came at a steep cost. 

“Unfortunately,” she says, “with making that leap, it’s like you’ve got to sign your life away to the devil.”

She kept her expenses to a minimum in order to pay cash for a portion of her annual tuition, including for most of her final year. She moved into a 300-square-foot studio in Aptos, where she’s now lived for eight years. She’s still trying to pay off two student loans she took out to help pay for her degree.

Molina is among more than 6,000 nonprofit workers in Santa Cruz County feeling the crunch of trying to make ends meet while dealing with the rising cost of living locally. A survey released earlier this year by the Human Care Alliance, a collaborative of more than 25 Santa Cruz County nonprofits, found that nonprofit workers are three times as likely to be severely housing-cost burdened as other Central Coast residents. It also showed that they are twice as likely as the general public to access social services to meet basic needs, such as food and medical care. Nonprofit leaders say such disparities should be a call to action for the community about what programs people see as worth investing in and how they will ensure those programs can continue serving the community without further squeezing the workers who provide the services. 

Squeezed Out

One of the first things Molina did when she started in the assistant director role at Meals on Wheels was to develop and coordinate a six-month process of digitizing all the nonprofit’s participant assessment records. It saves the program managers time that they would have otherwise spent dealing with paperwork, Molina says, so they can spend that time with their Meals on Wheels participants. 

Moving an entire system from manual to digital records takes skill and on-the-job professional development, she notes. “You need to really value what people with professional degrees are able to offer these programs,” Molina says. 

Those are exactly the people that the local nonprofit sector is at risk of losing, based on the Human Care Alliance’s findings. Some 85% of nonprofit leaders surveyed say they are losing skilled employees to better-paying jobs. Even though nonprofit employees locally tend to have higher levels of education than the overall Santa Cruz County workforce—39% of nonprofit workers surveyed have a bachelor’s degree, and 16% have a master’s degree—around three-fourths of nonprofit workers reported making less than $40,000 annually. The average hourly wage in Santa Cruz County is $26.21, which would come out to $54,517 for full-time work. 

At least wages are on the rise, as the state’s minimum wage increases and local nonprofits work to stay ahead of those requirements. Community Bridges is working toward paying all of its workers $15 an hour or more by July. Those increases require higher pay to salaried workers, too, since state law requires that they make at least double the minimum wage.  

Those wage increases could lead to a massive budget shortfall if nonprofits’ funding levels don’t keep up. Countywide, more than 100 local nonprofits would need an estimated $5,871,000 in additional revenue to address the required wage increases, according to the Human Care Alliance. “Nonprofits are trying to balance that situation where we don’t want to cut services, and at the same time employees are hurting,” says Raymon Cancino, CEO of the nonprofit group Community Bridges. 

The nonprofit sector has banded together to ask the county government and other funders for a minimum 5% boost annually in their baseline funding for the next three years to help promote wage equity. They’re also asking that local government contracts include annual cost of living increases, a move that other local governments like San Francisco have already made. It’s a change Santa Cruz County has “been very resistant to,” Cancino says.

Nonprofits are making other changes where they can in the meantime to control costs and promote equity, he says. Community Bridges has taken steps such as making sure the highest salary they pay is never more than five times the lowest salary. They bought an office to get out of the rental market’s rising costs. They’ve worked on creating an endowment and are working with donors to put money into the market to stay ahead of inflation, with the gains going to services. 

When their options for cutting and stabilizing costs are exhausted, though, “we’ll have to start reducing services as a result of these inequities,” Cancino says, if additional funding doesn’t come through. 

Those cuts could be widespread: If there are no funding increases, 65% of nonprofits surveyed say they would cut services by 10-14%, and another 23% would cut services by more than 15%. 

Weighing Options

Santa Cruz County decided about a generation ago to contract with nonprofits to provide the social services that the county had once offered directly, says Santa Cruz County Supervisor Ryan Coonerty, so nonprofits have an “incredibly important” role in the community.

He says the new survey captures the struggle that so many workers feel.

When it comes to funding nonprofits and the social services they provide, Coonerty says, the county has to weigh “how to make these investments upstream while also recognizing that we have very real problems we have to deal with right now. So it is about trying to figure out how we can do better with the resources we have.” 

In the short run, the county has been trying to be smart about how it provides services by taking steps such as bringing in a group to assess the county’s homelessness programs. The goal is to align programs “to get people the help they need as early and as effectively as we can with the idea of reducing both impacts and long-term costs,” Coonerty says. 

The county government funds nonprofits through one pot of what’s known as “core” funding and through contracts for specific services. The total amount of contracts for nonprofits is difficult to tally, the county says, because those are lumped in with for-profit professional services contracts. 

The county budgeted nearly $4.5 million in the current 2019-2020 fiscal year for core funding of community programs. That’s an increase of 20.8% from $3.7 million in core funding during the 2014-2015 fiscal year. But it’s also an amount that’s remained relatively flat since the 2017-2018 fiscal year, when the county also budgeted around $4.5 million.    

The county projects it will budget $4.4 million in core funding for the 2020-2021 fiscal year, though the board of supervisors can consider any changes to that amount in June. 

Absent any commitments from officials to sufficient funding increases, Cancino foresees nonprofits having to ask county residents at large to help protect levels of local services and nonprofit employees. 

Options include a possible social service bond measure or an ongoing request of local governments to allocate 1% of their general fund to providing social services, Cancino says. That would increase five-fold the current social services allotment from most jurisdictions, he says. 

A ballot measure would probably be a “harder ask,” Cancino says, since people seem to be “getting to the point of exhaustion” with such requests. 

Finding A Way

As discussions continue between nonprofit leaders and county officials about how to move forward in the next funding cycle, nonprofit workers are figuring out their own way forward. For 62% of those surveyed, this means taking on more than one job to make ends meet. 

Among that group is Claudia Razo, who leads payroll at Community Bridges and has worked in the local nonprofit sector for more than 20 years. 

She picked up evening janitorial shifts at her church for a while, taking the bus to and from the job. As a single parent, though, it left her youngest daughter alone at home and didn’t allow Razo time to help with homework, chores and after-school activities. 

“That just took a toll on my daughter,” Razo says. “So I had to give up that job. I couldn’t put her through that.”

But Razo is again at a point where she feels she needs to take on a second job. After paying all of the bills for the month, there’s usually less than $300 left for other needs. That doesn’t even count money for school sports or other activities her teenage daughter may want to participate in. 

She’s grateful to have a job she loves and for the family-friendly environment at Community Bridges, she says, where she has been able to bring her daughter to work when childcare wasn’t available. She’s accessed parenting classes and support from Women, Infants and Children. 

“You’ve just got to figure out a way to survive,” she adds, “but I just wish there was more opportunity, too.” 

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