Pinch of gov­ern­ment shut­down spreads in WNY

Doc­tors, ex­pand­ing busi­nesses and farm­ers fac­ing hard times as fed­eral stale­mate lingers

The Buffalo News - - FRONT PAGE - By Jerry Zrem­ski

A doc­tor in Buf­falo wants to be able to help more opi­oid ad­dicts, but the gov­ern­ment shut­down stands in his way.

Land­lords worry about los­ing the rent sub­si­dies that help nearly 20,000 low-in­come fam­i­lies af­ford a place to live.

In Buf­falo and be­yond, busi­nesses find them­selves un­able to get the gov­ern­ment-backed busi­ness loans they ex­pected.

And in Ge­ne­seo, a farmer ex­pects to miss out on nearly $45,000 in in­come the gov­ern­ment had promised him to com­pen­sate for his losses from Pres­i­dent Trump’s trade war with China.

Those are just some of the in­creas­ingly wide-rang­ing ef­fects of the three-week-old shut­down that is now the na­tion’s long­est ever.

The fed­eral op­er­a­tions that peo­ple see on a daily ba­sis – the mail de­liv­ery peo­ple, the cus­toms agents at the Peace Bridge, the Trans­porta­tion Se­cu­rity Ad­min­is­tra­tion agents at the Buf­falo Ni­a­gara In­ter­na­tional Air­port – con­tinue to work ev­ery day, even though Cus­toms and TSA agents are among the es­sen­tial fed­eral per­son­nel work­ing with­out pay dur­ing the shut­down.

But be­hind the scenes, in a num­ber of un­ex­pected ways, the shut­down is putting a crimp in ev­ery­thing from health care to daily busi­ness op­er­a­tions.

Here’s a sur­vey of what’s hap­pen­ing as the shut­down’s im­pact stretches from city to coun­try:

A doc­tor, ham­strung

Dr. An­thony Martinez of Buf­falo sees the rav­ages of the opi­oid cri­sis on a daily ba­sis. And he’s been able to help 95 of his pa­tients by pre­scrib­ing sub­ox­one, a drug that helps wean ad­dicts off opi­oids.

But that’s a daunt­ing num­ber to Martinez. The fed­eral gov­ern­ment man­dates that doc­tors pre­scribe to sub­ox­one to no more than 100 pa­tients un­less they ap­ply for a waiver that can al­low them to give the drug to up to 275 peo­ple.

Martinez has ap­plied for such a

waiver, but with the Sub­stance Abuse and Men­tal Health Ser­vices Ad­min­is­tra­tion shut down, his ap­pli­ca­tion is go­ing nowhere. So he ex­pects to meet his quota of 100 sub­ox­one pa­tients next week – and to not be able to help oth­ers who need the drug af­ter that.

“This sheds a light on the fact that the shut­down is not just about the gov­ern­ment, but that it has the po­ten­tial to be a pub­lic health prob­lem,” said Martinez, an as­so­ciate pro­fes­sor of medicine at the Univer­sity at Buf­falo who prac­tices at Erie County Med­i­cal Cen­ter.

The opi­oid epi­demic has been a pub­lic health prob­lem for years, but Martinez fears the shut­down could make it worse in Buf­falo and na­tion­wide. Af­ter all, other doc­tors else­where are likely faced with the same cap and the same sit­u­a­tion.

“We have pre­cious few slots avail­able and a large wait list of pa­tients wait­ing on treat­ment,” said Martinez, who noted that Buf­falo ex­pe­ri­enced nine over­doses and three opi­oid deaths last week­end alone. “This shut­down has now reached Amer­i­cans wait­ing on ther­apy and is a lit­eral life-and-death sit­u­a­tion for some.”

Pend­ing hous­ing cri­sis

Thou­sands of apart­ments across Buf­falo don’t re­ally look like gov­ern­ment hous­ing, but in ef­fect, they are. They’re part of the De­part­ment of Hous­ing and Ur­ban De­vel­op­ment’s Sec­tion 8 hous­ing pro­gram, which sub­si­dizes rent for low-in­come res­i­dents in many prop­er­ties.

Now, though, the de­part­ment known as HUD is shut down – and the Sec­tion 8 pro­gram, which serves more than 20,000 fam­i­lies in Erie and Ni­a­gara counties, is in dan­ger of be­ing starved of funds.

That’s a huge con­cern to Michael Riegel, pres­i­dent of Bel­mont Hous­ing Re­sources for WNY, which works with land­lords who man­age nearly 7,000 prop­er­ties.

“We’re set through Fe­bru­ary, but if no money comes in for March, we’re in se­ri­ous trouble,” Riegel said. “In that case, the land­lords won’t get their fed­eral share of the rent. So they could end up evict­ing ten­ants or charg­ing them the whole rent.”

And it’s not just ten­ants who live in Sec­tion 8 hous­ing who have to worry, either. Gil­lian Brown, ex­ec­u­tive di­rec­tor of the Buf­falo Mu­nic­i­pal Hous­ing Author­ity, said his agency would have to start dip­ping into its re­serves if it the shut­down con­tin­ues and the agency doesn’t get its reg­u­lar fed­eral sub­sidy by March.

What’s more, main­te­nance prob­lems have plagued some Buf­falo hous­ing projects – and HUD hous­ing in­spec­tors have been on fur­lough since be­fore Christ­mas. Brown noted that the in­spec­tor gen­eral au­di­tors who were ex­am­in­ing the agency haven’t been seen since be­fore Christ­mas, either.

Busi­ness loans blocked

For decades, en­trepreneurs have turned to their local lenders – and to the Small Busi­ness Ad­min­is­tra­tion’s loan guar­an­tee pro­grams – for help.

But be­cause of the shut­down, that gov­ern­ment help has dis­ap­peared. And that means busi­nesses aren’t get­ting the money they need to get go­ing.

At M&T Bank – the re­gion’s largest small-busi­ness lender – 25 SBA-backed loans, worth a to­tal of $4.3 mil­lion, re­main in limbo in Western New York.

“They can­not be pro­cessed un­til the shut­down ends,” said Eric Feld­stein, the head of M&T’s busi­ness bank­ing di­vi­sion.

Sim­i­larly, the Bank of Akron – an ac­tive busi­ness lender to the east of Buf­falo – re­ports 10 loans in limbo.

Of­fi­cials at both banks said they are work­ing with cus­tomers to try to de­vise lend­ing pack­ages that can go for­ward with­out the SBA guar­an­tee, which greatly re­duces the risks that local lenders face.

“We’re try­ing to re­struc­ture deals to elim­i­nate any wait,” said Tony Del­monte, pres­i­dent and CEO of the Bank of Akron.

But lenders can only do so much with­out gov­ern­ment back­ing for the riskier loans. That’s why Rep. Ny­dia M. Ve­lazquez, a Bronx Demo­crat who chairs the House Small Busi­ness Com­mit­tee, wrote to SBA Ad­min­is­tra­tor Linda McMa­hon on Fri­day de­mand­ing an­swers about how the shut­down is af­fect­ing small-busi­ness lend­ing.

Among busi­ness­peo­ple seek­ing help from the SBA, “the level of anx­i­ety is un­prece­dented,” Ve­lazquez told the Wash­ing­ton Post.

Farm losses

The shut­down is the sec­ond gov­ern­ment-in­flicted blow to Brad Macauley’s soy­bean and dairy farm in Ge­ne­seo.

First came Trump’s trade war with China, which the pres­i­dent started with a round of tar­iffs on Chi­nese ex­ports last year. China quickly re­tal­i­ated with a set of tar­iffs of its own, in­clud­ing levies on soy­beans: Macauley’s cash crop.

China’s pur­chase of Amer­i­can-grown soy­beans quickly plum­meted, cost­ing Macauley’s farm and soy­bean farms na­tion­wide a huge chunk of their busi­ness. Hop­ing to ease the pain, the Trump ad­min­is­tra­tion set up an $11 bil­lion cash as­sis­tance pro­gram for soy­bean grow­ers.

Macauley ex­pected to get a $99,000 fed­eral pay­ment. He got the first half of that money a few months ago, but the sec­ond half is now sus­pended, along with most of the De­part­ment of Agri­cul­ture’s op­er­a­tions.

“That money would def­i­nitely help, with­out a doubt,” said Macauley, who em­ploys about 11 on his 1,000-acre farm.

Money is tight not only be­cause of the loss of the soy­bean trade with China, but also be­cause of fall­ing milk prices, he noted.

But he sounded more con­cerned about the tar­iffs Trump im­posed than the loss of the gov­ern­ment help he ex­pected be­fore the shut­down.

“We’d rather have trade, not aid,” Macauley said. “When you put re­stric­tions on cap­i­tal­ism, it’s just not cap­i­tal­ism any­more.”

– Dr. An­thony Martinez, an as­so­ciate pro­fes­sor of medicine at the Univer­sity at Buf­falo who prac­tices at Erie County Med­i­cal Cen­ter and who is wait­ing for a waiver from the Sub­stance Abuse and Men­tal Health Ser­vices Ad­min­is­tra­tion.

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