Tony Tye, Post-Gazette Diana Aviv, president and CEO of Independent Sector: "You don't have to be a rocket scientist" to see what's coming down the funding pipeline. Click photo for larger image.

Facing a future of uncertain funding, some local human services providers are turning to collaborative projects.

In one of the biggest cooperative efforts, Downtown consultant Kate Dewey is helping organize 215 local providers, such as the Wesley Institute, Action Housing and the Boys and Girls Clubs, into a single Health Benefits Initiative designed to save on employee insurance costs.

It was an idea born of necessity -- some of her clients had seen their insurance costs go up 65-85 percent in one year, Dewey said.

Back-office operations are another area where providers are beginning to pool efforts to pare costs.

The Centers for Victims of Violence, for example, has joined forces with two other agencies -- POWER, a drug and alcohol rehabilitation program -- and Bethlehem Haven, a center for homeless women, to share human resources and accounting services. And the Spectrum Family Network has joined seven other organizations to share expenses for staff instruction in first aid, CPR, use of passive restraints and other required training.

Regionally, 36 mental retardation services providers in 18 Western Pennsylvania counties have banded together in The Provider Alliance, helping each other in areas such as staff retention and training, while making group purchases of health and other insurance to lower costs. "We just thought that looking at it from a regional basis, we could get more bang for the taxpayer dollar," said Ed Picchiarini, director of operations.

It is these kinds of cooperative projects that more nonprofit agencies should consider, said Diana Aviv, president and CEO of Independent Sector, a Washington, D.C.-based coalition whose members include more than 500 nonprofit groups nationwide.

"You don't have to be a rocket scientist" to see what's coming down the funding pipeline, said Aviv, who spoke to local nonprofit leaders in Pittsburgh last week. According to the Center on Budget and Policy Priorities, the Bush administration's budget proposal calls for more than $500 billion in cuts for nondefense programs.

"To say we have a crisis more than describes it adequately," said Aviv. "I think we have only begun to see the kinds of cuts that are coming down the pike."

And it's not just the federal deficit that worries her.

States, including Pennsylvania, have been wrestling with deficits, too, which means they have a tougher time finding matching funds required to be eligible for federal money. "When the feds cut and the states cut, the impact at the local level is double."

Allowing the deficit to grow, or shrinking the deficit by raising taxes, are both unpopular and unlikely alternatives, she said. A third option would be cutting programs.

"Or," said Aviv, "we can reorganize."

Aviv envisions collaborations like those started in Pittsburgh, where agencies share everything from copiers to accountants. In some instances, merging agencies might make the most sense.

But pulling off mergers isn't easy, she said. Two agencies offering similar services, for example, might not be a good match. "They will fight to the death rather than merge."

Without a serious move toward greater collaboration, though, that merge-or-die scenario may be the only choice left.