Luzerne County government struggling with funding delays due to state budget stalemate

Luzerne County government is struggling with funding delays due to Pennsylvania’s budget stalemate, which has already impacted the county’s Children, Youth and Families agency.

County CYF was counting on a $6.4 million state funding allocation in mid-August that is now on hold, according to an email county Manager Romilda Crocamo sent to county council Tuesday, which indicated the situation is now at a “critical juncture.”

“This leaves us with having to cover the cost of payroll and also the adoption/foster subsidies,” it said, noting these subsidies are $850,000 to $900,000 per month.

The administration is calling for state legislative action on the budget.

“Each day the budget remains unresolved adds risk to vulnerable populations and weakens the fiscal position of our provider network. While we are doing everything possible to manage within current limitations — including using local funds temporarily where possible — this is not sustainable long-term,” Crocamo said.

State elected officials must “fulfill their responsibilities and work collaboratively to resolve these issues,” she added.

“The recent failure to reach consensus on the bill sponsored by state Sen. Lisa Baker, which sought to maintain essential funding levels, is a glaring example of how political disagreements can hinder progress and exacerbate the struggles faced by those in need,” Crocamo said.

County CYF Administrator Katrina Gownley and Human Services Division Head Megan Stone said Tuesday the county has been covering the agency’s payroll as a result of the state funding delays, and the agency will reimburse the county whenever state funds arrive.

However, the county has not provided funding to cover approximately $4 million in bills owed to outside providers for a range of services, including prevention programs and rapid crisis response, they said.

“Our hands are tied,” Stone said. “Some counties are taking out loans, but that’s not an ideal situation, and we don’t want to get into that. We’re trying to hold on tight and hope the budget passes sooner rather than later.”

County Budget/Finance Division Head Mary Roselle said the county is covering approximately $360,000 per month to cover CYF payroll plus benefits since a state budget did not take effect July 1. This floating of payroll is in addition to the county’s standard payment of a required match totaling $575,000 per month, she said.

Roselle noted outside vendors are accustomed to payment delays because CYF typically pays them a month or more late due to the way its funding is received.

The county is “not in a position” to fund additional CYF expenses at this time, Roselle said. The county must retain a fund balance to keep its A credit rating from Standard and Poor’s, she said.

“We have to do everything to make sure we maintain our a credit rating,” Roselle said. “We can’t do things that are going to play with that credit rating.”

The county faced a similar challenge over a state budget impasse in 2015.

All county services were in jeopardy at that time because the administration kept fronting money to keep human service agencies operating as it waited for overdue state reimbursements. By the time the administration presented a proposed $20 million emergency borrowing request to council, the county had no other means to cover payroll, debt repayments and other pressing expenses outside human services, according to prior reporting. After heated debate, a council majority had approved the emergency borrowing.