Several events in the past year have raised significant challenges
for our community. First, we are experiencing the first sustained,
substantial economic slowdown in over a decade. Second, a series
of state and federal policy changes have had major impacts on
some key social services. Third, the events of September 11 and
the lingering threat of terrorism have brought a whole new set
of issues to the forefront. This overview is intended to provide
information about what is happening in all sectors of the community
- public, private, non-profit and faith based.
ECONOMY:
Toward the end of the year 2000, our community began experiencing
a significant economic slowdown.
- The Greater Austin Chamber of Commerce reports 20,700 layoffs
since the beginning of 2001 -- 16,005 in the high tech industry.
Closures and reductions in the high tech industry continue to
have a ripple effect across all segments of the economy. For
the first time in many years, we have seen unemployment in Travis
County climb steadily, from just 1.9% in October of 2000 to
4.7% in October of 2001. Further layoffs and rising unemployment
resulting from the ongoing economic slowdown will continue to
have lasting impacts on individual residents, families, and
the community overall.
- The Comptroller's Leading Economic Indicator Index
underscores the slowdown. At present, eight of its ten economic
indicators have worsened over the past year (June '00 to June
'01), including the three that are most predictive of the future
economy-the consumer confidence index, the help-wanted index,
and initial claims for unemployment compensation. On a more
positive note, housing permits are up, most likely a result
of the lower interest rates.
- Despite the downturn in the economy and the rise in unemployment,
there is some positive news. Some companies, such as Dupont
Photomask and UT Austin Biomedical Engineering Dept. are continuing
to create new jobs. In September 2001 there were 9,500 more
jobs in the community than in September 2000. Similarly, the
number of patents issued (January - October 2001) in Austin
are up from the same time last year. A national poll conducted
in mid-October by the Gallup Organization found that although
people have a poor outlook on the national economy they are
feeling positive about the local economy where they live, the
businesses where they work and their own financial situation.
- In the last decade, the cost of living in the community
has risen significantly. The recent downturn in the economy
has resulted in some residents being caught in the sudden layoffs
while still bearing the economic brunt of the high cost of living
in the area.
- Of the top ten occupational categories in the Austin-San
Marcos Metropolitan Statistical Area (MSA), 28.8% of those jobs
(186,360) have a median hourly wage of less than $10/hour. Information
recently released by the Center for Public Policy Priorities
indicates that a single adult with no children needs to earn
at least $10/hour in order to secure basic necessities. However,
a single parent with one child needs to earn a minimum of
$17/hour to support a family ($33,819/yr). For a family
of two parents and two children, the Austin-San Marcos MSA is
the most expensive metropolitan area in the state in which to
live.
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POLICY CHANGES:
Although a comprehensive list is not available, following are
some selected examples of policy changes that are impacting various
sectors of the community.
- Funds for Dislocated Workers. Last year, Work Source
spent some $640,000 to address the needs of dislocated workers.
However, this year's contract with the Texas Workforce Commission
is only $280,000. While it is possible additional funds are
available, at this time they are not secured.
- Victims of Crime Act (VOCA) Funds. During the VOCA
last funding cycle, 8 programs requesting more than $1 million
were not funded, despite several programs being previous grantees.
Additionally, as a result of policy changes and the expenditure
of reserve funds, the Governor's Office announced a 12.5% cut
($435,000 for the ten county region) in VOCA grants for funding
year 2003. The Capital Area Planning Council (CAPCO) has decided
to close the application process to all but current grantees
and ask that they all take a 12.5% across the board cut.
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SEPTEMBER 11 IMPLICATIONS:
- Recent information suggests that retail sales have taken
a dip since September 11th. State sales tax revenues are
down $42 million and well below projections for the period.
- Austin's September sales tax revenue shrank 12.7 percent
compared with September 2000, foreboding likely budget cuts,
according to the city's finance director. The decrease in tax
revenue is attributed to the decline in consumer purchases immediately
after the September 11th terrorist attacks. It represents a
$1.4 million loss in projected City of Austin revenue.
It was also the largest month-to-month drop among major cities
in the state and the largest in Austin since at least 1988.
- Anxiety has increased. The daily call volume at the
Seton emergency call center was up 26% in September and 40%
in October compared to the same months last year. Call center
staff report that each nurse is fielding at least five calls
per day about anthrax, and nurses are reporting that many more
people are calling about concerns they may not have called about
before September 11th.
- Many reservists and National Guard members who have
been called into active military duty are taking pay cuts when
they move from their civilian to their military positions. Although
Dell and EDS are two local employers who plan to make up the
pay difference for employees called to active duty, most employers
are not in a financial position to follow suit. This could negatively
impact military families left in Austin, possibly putting a
further strain on an already overloaded service system.
- The Austin Police Department is restructuring in response
to the September 11th events, including forming a Homeland Defense
Division, expanding Search and Rescue and Explosive Ordinance
Disposal (EOD, or Bomb Squad) units, and considering changes
to the role of Street Response.
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INDIVIDUAL AND FAMILY IMPACTS:
- Basic Needs: Job loss can create a domino effect for
individuals and families who are on the precipice of self-sufficiency.
Job loss can force choices between necessities such as buying
food and paying other bills such as rent, utilities and medical
care. For families without savings or a financial cushion, a
job loss by itself or combined with another emergency, such
as a medical need, can have dire consequences such as family
being forced onto the streets.
- Rising cost of living (up 30% from 1991 to 2001) and
growing economic disparity is leading to an increased demand
for human services.
- Health: The unprecedented number of layoffs experienced
in our community in the last year will continue to impact the
health of Travis County residents. The likelihood of a continued
economic downturn will result in increased demands for comprehensive
health services. Unemployment or job loss has been consistently
identified as a significant determinant for health and well-being.
Job loss has been directly associated with the incidence of
diseases such as heart disease, substance abuse disorders, and
the onset of serious mental illness. A recent study determined
that 30% percent of people who experienced job loss also experienced
a serious mental illness. In contrast, only 19% percent of people
who maintained steady employment had a serious mental illness.
In addition to actual job loss, the perceived or real threat
of job loss can increase stress and anxiety. The Austin area
has been identified as a part of the country with a high rate
of anxiety, depression, and suicide. In fact, a nationwide study
conducted by the National Research Corporation found that the
Austin area ranked third in the country in the percentage of
people reporting depression or anxiety disorders. Similarly,
the suicide rate in Travis County from 1989 to 1998 was 12.2
per 100,000. This rate is double the national target of 6.0
suicide deaths per 100,000.
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COMMUNITY IMPACTS:
- Ever-worsening economic scenarios are sending state legislators
scrambling to balance the budgets for the coming year, in
many cases meaning significant cuts in Medicaid and other health-related
services. A federal economic stimulus package passed by the
House of Representatives could make a precarious situation even
worse, reducing state tax revenue by $15 billion over the next
three years, and likely forcing further budget cuts and tax
increases on the state level.
- Public Sector: The economic slowdown has already had
a major impact on state and local government revenue. Sales
tax revenue, in particular, is down significantly. Many government
entities are contemplating significant budget reductions. For
example, the Austin American Statesman reported that the City
of Austin is currently contemplating 5% or 12.5% across the
board budget reductions, with the exception of police, fire,
and emergency response services.
- Charitable Giving: A national survey conducted in
October 2001 on charitable giving released by Independent Sector
provides some idea of what to expect in the area of charitable
giving. A big concern is that money that would normally go to
local charities is going to New York to support the relief effort
from September 11th. The survey results indicate that 73% of
respondents expect to continue giving at their regular levels
and that contributions to September 11th are above and beyond
regular donations. The interpretation is that the impact
of September 11th on local fundraising efforts should be short
term, not long term. The biggest impact on giving is the
economy. One out of ten respondents to the survey indicated
that they will stop making charitable contributions as a result
of the economic downturn. Another 11% said that they will reduce
their giving as a result of the economy. One positive note is
that the events of September 11th brought many first time donors
to the table. This could have a positive impact over time.
Recent reports indicate that local charities and non-profits
are feeling the pinch. For example, both Lifeworks and SafePlace
have reported layoffs in recent weeks. Caritas has cut rent and
utility assistance because of fewer dollars coming in, and Austin
Community Nursery Schools closed one of its schools.
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LONG-TERM DEMOGRAPHIC TRENDS:
The total population for Travis County (812,280) has increased
41% since 1990. Further complicating the changes our community
has experienced in the past year are a number of continuing demographic
trends:
People in poverty:
- Currently there are more than 105,000 people in Travis
County living in poverty ($17,050 for a family of four) -- approximately
13% of the total population.
- Of the 155,718 rural residents of Travis County, approximately
20,000 live in poverty (13%).
- It is often the case that individuals who work still require
basic needs assistance. People who are working, but still not
self-sufficient include those who are: employed at low wage
levels, working multiple low wage jobs, or employed part time.
Eighty percent of poor children in Texas live in families in
which at least one parent works. The Texas Department of Human
Services (TDHS) estimates that there are up to 200,000 working
poor in Travis County (defined as living at or below 200%
of the federal poverty income guideline).
- Another indicator of the magnitude of the "working poor"
in Travis County is the number of public school students who
are considered economically disadvantaged. Students are considered
to be economically disadvantaged when they qualify for free
or reduced-price lunches. Thirty-four percent of all students
in Travis County Independent School Districts (ISD) qualified
during the 1999-2000 school year. Del Valle (63.4%), Manor
(52.9%) and Austin (46.8%) ISDs exceed the county-wide rate.
Fifty-four percent Travis County elementary school students
qualified for free or reduced-price lunches.
Race/Ethnicity:
- Travis County is not only larger, but more diverse.
The total African-American population has grown 25% since 1990,
the Hispanic population 88%, and persons of other races (including
mixed races) have increased 126% in the last ten years. The
percent of minority students in Travis County ISDs increased
from 47% in the 96-97 school year to 49% in 99-00. Hispanic,
African-American, American Indian, and Asian students currently
comprise 61.3% of elementary school students in Travis County.
Immigration:
- At least 63,500 Travis County residents were born in a country
other than the U.S. (an unknown number of undocumented residents
were not counted during the 2000 Census).
- Service providers have experienced increases in the number
of immigrants (primarily Spanish-speaking) seeking assistance.
Family Structure:
- 22% of Travis County children live in single-parent families.
Census 2000 estimates that there are 39,381 single parents in
the Austin/San Marcos MSA.
Aging:
- Our community is growing older. By the year 2020, it is
estimated that nearly one in five Travis County residents will
be age 60 or older, an increase of more than 100% from 2000.
In the last 10 years, this portion of the population increased
30%. Individuals age 75 or older are the fastest growing segment
of the older adult population and increased 46% in the last
10 years. There are currently 74,762 elderly persons age 60
or older and 24,956 age 75 or older in Travis County.
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DEMAND INDICATORS:
Housing, Homelessness, Basic Needs:
- In a comparison of the first 10 months of 2000 and the
first 10 months of 2001, United Way's First Call for Help
has experienced an increase in the number of callers requesting
basic needs services. Callers needing help to pay electricity
bills increased 109%. The situation was intensified in large
part because Austin Energy changed their billing system and
sent out a large quantity of shut off notices in late spring,
2001 that normally are distributed throughout the year. In addition,
First Call for Help saw a 16% increase in calls for rent
assistance. Lastly, calls for transitional housing increased
by 91%, reflecting the growing number of homeless families.
- The Capital Area Food Bank had 170 first-time requests
for help in October of 2001, compared with 20 first-time requests
in October of 2000.
- Caritas is feeding 50% more people this year in its
free lunch program than it did last year. At the same time,
Caritas is experiencing a $700,000 decrease in their annual
income, which has caused appointments for families needing assistance
with rent and utilities to decrease from 5,000 last year to
1,700 this year.
- Austin Community Nursery Schools recently closed one of
its schools, which provided affordable day care for children
in low-income families.
- There are an estimated 3,977 homeless persons in Austin
on any given day.
Physical and Mental Health:
- 152,709 people in Travis County do not have Health insurance,
approximately 23.6% of the total population. First Call for
Help has experienced a 63% increase in the number referrals
to CHIP/TexCare partnership, suggesting that the promotion
of the program is working, or possibly that more middle class
families are without health insurance for their children. People's
Community Clinic has turned down more than 2,000 people seeking
assistance since May of this year.
- A poor economy has brought a record number of patients to
Austin/Travis County health clinics. Many people laid off
from their jobs have lost their insurance benefits, forcing
them to seek public health care. The county health clinics
have to see all patients and stretch tax dollars the best they
can. But one low cost clinic not funded by the county has turned
away two thousand patients in the past two months.
- Based on the National Institutes of Mental Health estimates
for the prevalence of mental health issues, an estimated 171,242
adults and children with mental health problems live in
Travis County.
- A conservative estimate is that 25,000 youth and adults in
our community need substance abuse treatment.
- In the last nine months, Planned Parenthood has experienced
an increased demand for services, especially medical services.
Additionally, demand for contraception and family planning services
for teens and young adults has increased. The majority of Planned
Parenthood clients are adults between the ages of 20-29 and
are Hispanic. While demand is up, their primary federal funding
sources have remained "flat" and their operational
costs, especially for medical supplies and testing, have continued
to rise.
- In 1999, the number of teen births in Travis County was 676,
a rate of 44.0, a slight increase from the previous year. In
2000, the teen pregnancy rate dropped significantly to 40.9,
while the number dropped to 655.
Public Safety:
- Of the Travis County total child population of 176,335 --1,653
were confirmed victims of abuse or neglect. In comparison
to other large counties in Texas, Travis County has the highest
rate of child abuse/neglect with 9.4 per 1,000.
- In a comparison of the first 9 months of 2000 and 2001, APD
Victims Services saw a 25% increase in the child neglect
cases referred to their office, an increase of 42 clients served
from one year to the next.
- In FY 2001, there were 83 commitments to the Texas Youth
Commission (TYC) from Travis County Juvenile Court. This represents
a 37% decrease from the 132 commitments in FY 2000, and
is the lowest number committed since fiscal year (FY) 1994.
Only 3% of the juveniles physically referred to Travis County
Juvenile Court in FY 01 (83 out of 2,592) were committed to
TYC. The numbers in the chart to the right represent TYC commitments
from Travis County over the last nine county fiscal years.
- During the last year, Austin has experienced an increase
in robbery. However, at this time, the Austin Police Department
(APD) does not expect to see changes in the crime index numbers
as a result of the economic downturn and has not seen changes
as a result of September 11th.
- In a comparison of the first 9 months of 2000 and 2001, calls
to the domestic abuse and sexual assault hotline at SafePlace
decreased. However, the battered women's shelter is cutting
its budget by one million dollars and laying off staff - despite
99 children being on a waiting list for sexual abuse counseling.
Projections:
- Research shows that economic deprivation can increase the
incidence of substance abuse, crime, adolescent pregnancy, school
dropouts, poor health outcomes, etc. If current economic trends
continue, it is possible that Travis County will see additional
impacts on these and other indicators in the future. The CAN
will continue monitoring changing conditions in our community
in order to respond more quickly and effectively.
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