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Jeffrey Walter, interim CEO of the CT Community Nonprofit Alliance (Rowan Kane photo)

The private nonprofit community that takes care of Connecticut’s neediest and disabled residents said Gov. Dannel P. Malloy’s budget includes the “most devastating cuts we’ve ever seen.”

Malloy’s budget, which he proposed Wednesday, cut $570 million in spending, including a 5.75 percent across-the-board cut to state agencies. A handful of those state agencies help fund these private nonprofit providers.

Jeffery Walter, the interim-CEO of the CT Community Nonprofit Alliance, the industry association that represents 550 private nonprofit providers, said the cuts could not have come at a worse time considering the uncertain economic climate and demand for services.

Combined with the annualized savings from the December deficit mitigation, the 5.75 percent across-the-board cut means the Department of Social Services will see its budget reduced by more than $22.7 million. The Department of Mental Health and Addiction Services will see a reduction of more than $42.6 million and the Department of Developmental Services will see its budget reduced by more than $39.1 million.

Malloy’s budget also cut funding to specific programs, including $15.8 million from mental health and substance abuse service grants.

That means there will be less funding for these nonprofits, but it’s still unclear how much less in some cases.

These cuts are “much more drastic than can be absorbed,” Walter said Thursday at a Legislative Office Building press conference.

He said it’s likely the proposed budget “will leave thousands of individuals who rely on life-sustaining services with nowhere to turn.”

Asked if the proposed cuts could be considered “core” governmental services, budget director Ben Barnes said they were “core” governmental services, but cuts needed to be made.

Funding for certain services, including education, Medicaid, and other entitlements have been protected from deep cuts.

“We cut $560 million out of the state budget so even core services may need to be accomplished with reduced services in some cases,” Barnes said. “Every line item is not a core service.”

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Rep. Cathy Abercrombie, D-Meriden (Rowan Kane photo)

A stated goal of the governor’s budget is to define what exactly these core services are within each agency.

Barry Simon, president of Oak Hill, a state-funded provider of services to the developmentally disabled, said that the proposed budget creates an opportunity, at least when it comes to how the Department of Developmental Services disperses funding.

According to Simon, the budget does not make any cuts to DDS’s residential services and could break a “gridlock” in how services are paid for by the state. Currently, DDS funding follows the individual who is receiving services. The new budget converts provider grants into “fee-for-service payments” under the Department of Social Services.

That means the money will fund services offered by the nonprofits, instead of following the client.

Simon said this is a “complex conversion” and would only be successful if stakeholders understand the intricacies of the change and are able to participate in the process.

Rep. Catherine Abercrombie, D-Meriden, was not so optimistic. It is an “exciting time and a devastating time” for nonprofits in Connecticut, she said. According to Abercrombie, legislators have continually asked service providers to “toe the line” for the last four years and promised that “it will get better.”

“It’s not going to get any better,” Abercrombie said Thursday. “Our providers cannot do it any longer without help from the state. We ask them to be partners, but in reality we have not been good partners.”

In past years, lawmakers like Abercrombie have spared the nonprofit community from deeper cuts.

Kim Beauregard, president and CEO of InterCommunity, an East Hartford-based community health center, said she doesn’t yet know how the proposed cuts will affect her organization, which serves over 9,000 residents. Intercommunity laid off four of its administrative employees last week in hopes of becoming more cost-efficient, but Beauregard worries that the cuts could impact the behavioral health and substance abuse services her organization offers.

She urged lawmakers to be transparent about the cuts they plan to make because they have an impact of real people’s lives.

“The need for those services will not go away with budget cuts,” Walter said. “They will fall into more costly alternatives: emergency rooms, hospitals, and jails.”