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For the past few decades, a tremendous amount of time and money has been spent on integrating people with disabilities into the non-disabled community. As part of this process, how employment integration is defined continues to evolve and there is a small group advocating for “Employment First” legislation that would embody the following definition:

“Expecting, encouraging, providing, creating, and rewarding regular integrated employment in the workforce at minimum or competitive wages and benefits as the first and preferred outcome for working-age youth and adults with disabilities especially for those with complex and significant disabilities, for whom job placement in the past has been limited, or has not traditionally occurred” (MN Employment First Report - September 30, 2011).

According to this same report – “The employment rate for individuals with disabilities reported by the Office of Disability Employment Policy, is less than one-third that of people without disabilities (21% compared to 70% respectively)”. I do not consider this statement accurate. Conservatively speaking, at least two percent of our state’s population of 5,303,925 (2010 MN Office of Geographic and Demographic Analysis) has a developmental or intellectual disability (D/ID, formerly referred to as mental retardation) resulting in a total state population of at least 106,000 people with D/ID. Again referring to the MN Office of Geographic and Demographic Analysis, 84% of the population is of working age (16 – 64) which means that 89,000 (106,000 x .84) citizens with D/ID are of working age. According to the “Minnesota State Profile Tool:  An Assessment of Minnesota’s Long-Term Support System” (Eiken, S., L. Gold, S. Larson and K.C. Lakin, 2009, Table 2.2) 27,750 citizens (1,859 ICFs/MR, 14,056 DD Waiver, 11,855 CADI) with D/ID are served on a monthly basis. That would leave 78,250 (106,000 – 27,750) citizens with D/ID that are not “in the system” of which 65,730 (78,250 x .84) are of working age. Therefore, it could be argued that 74% (65,730 / 89,000) of people with D/ID of working age are in the workforce at minimum or competitive wages and benefits since they are living in their communities without any public support – not the 21% cited in the MN Employment First Report.

This leads to the second part of this issue concerning the definition of “integration” and it seems unlikely that the stakeholders supporting the D/ID population will soon come to a consensus definition. Moreover, in a very real way integration is a choice. For example, a retired couple that chooses to live in an assisted living complex with their same-aged peers would not think of themselves as being segregated. So, if integration is defined and chosen by the individual, perhaps defining segregation would be helpful in this discussion and I offer the following:

“Segregation is the forcible separation of a group or class from the rest of society”.

From my view this term does not apply to the 27,750 people with D/ID served by group homes and DT&H programs in Minnesota because their placement was chosen by an interdisciplinary team that included themselves, their guardian/family, and an independent case manager. Therefore, if people with D/ID are not segregated, they must be integrated. Beyond the reality of integration as an individual choice, as Martin Luther King, Junior said – “True integration will be achieved by true neighbors who are willingly obedient to unenforceable obligations.” This quote suggests to me that if we genuinely listen to the person with D/ID to identify their preferences, determine and build on their skills, and actively search for connections in their neighborhoods – businesses will hire them and communities accept them because they add value, not out of charity or because of some government mandate. It all comes down to doing the right thing, at the right time, one person at a time, without all the hyperbole coming from the ivory tower.

Is working in a facility-based DT&H program a good choice for people with D/ID? Yes if that is the individual’s preferred choice. Moreover, having state legislation that makes “minimum or competitive wages and benefits the first and preferred outcome” is contrary to person-centered planning and legislators need to hear the thoughts of their constituents on this issue.

Can more people currently served by DT&H programs be competitively employed? If that is their choice – yes and better progress will be made if we stop setting goals that are based on statewide statistics. For instance, the MN Employment First Report references the Fourth Summit of the Employment First Coalition that was held on September 30, 2011, around the question, “What will it take to double employment of Minnesotans with disabilities by 2015?” The answer is we cannot double the 74% employment rate of the statewide D/ID population, however, we can work on increasing the number of DT&H clients of working age in the workforce at minimum or competitive wages if that is the individual’s preferred choice.

COMMENSURATE WAGE IS NOT A TURKEY

Fueled by an egregious situation involving an Iowa turkey farmer, there have been some provocative media stories and federal committee hearings calling for the repeal of the commensurate wage provisions of the Fair Labor Standards Act (FLSA). To be clear, the review and discussion of the commensurate wage provisions to ensure that outcomes are meeting original intents should be encouraged. Unfortunately, statements in the National Disability Rights Network document entitled Segregated & Exploited – A Call to Action are both misleading and one-sided; and those who are championing the repeal of the commensurate wage provisions at committee hearings are only telling half the story.

Presuming most of the readers have worked at some point in their life I assume that everyone understands that not every worker in America is paid a guaranteed wage. There are many examples of workers that are non-disabled who get paid a special minimum piece-rate, sub-minimum wage plus tips, or 100% commission (assembly worker, food server, sales professional) that result in earnings commensurate with their productivity.

Unlike Greece that is struggling with an economy where workers are paid more because of their personal connections than productivity, I believe that one of the most important elements of capitalism is that most often workers and businesses are paid based on the value of what they produce – nothing more and nothing less. Few among us would choose to leave a server at a breakfast diner a 15% gratuity if we knew that person was earning $15 an hour.

The following points are an attempt to quickly tell the other half of this story and explain why the commensurate wage certificate is an important option in providing meaningful work to people with disabilities.

• Providers are NOT paying sub-minimum wages to anyone. Providers with a commensurate wage certificate are paying special minimum wages that are monitored and enforced by the FLSA. The process to obtain a commensurate wage certificate is rigorous, reported on annually, subject to renewal procedures, and enforced by the Department of Labor.

• Calculating a special minimum wage requires the provider to establish the local market wage, not the minimum wage, and the output of a worker who is non-disabled to determine the “unit rate” for the work to be completed. The provider must then track the number of units the worker who is disabled produces and multiply this by the rate to determine each individual’s earnings. Everyday workers who are disabled are paid more than the minimum wage because they produce units at a rate exceeding the standard.

• Human service providers are able to secure contracts with businesses that offer meaningful work to clients who are disabled because the cost to produce the units matches the market. To expect businesses to pay more than “market value” for a unit is asking the private sector to subsidize the human service system. This added cost would have to be passed onto the consumer inflating the cost of living and essentially become a hidden tax.

• Facility-based programs are usually located near other similar businesses within the community. Furthermore, according to the most recent MN State survey of DT&H providers, 61%, of the workers who are disabled are facility-based, 34% work as part of a crew at an employer-based setting, and 12% are hired directly by a business. Facility-based programs offer an important choice for vulnerable adults not ready or interested in working within an employer-based setting.

• Finally, let’s talk about choices for workers who are disabled and their families. No one is required to be served by a provider with a commensurate wage certificate. By definition, segregation is to impose the separation of a group or class from the rest of society and that simply does not apply to clients with guardians and independent case mangers that choose commensurate wage providers. If a person with a disability does not want to be paid a special minimum wage, they are free to find a job on their own for a wage they find acceptable. There is no need to destroy an option that permits human service providers and businesses to offer meaningful work at a fair wage to millions of our citizens with disabilities.

In closing, what the opposition doesn’t tell anyone is that the repeal of the commensurate wage provisions will result in the loss of meaningful work and wages for millions of citizens with disabilities without any alternative options. At Merrick, the loss of the commensurate wage provisions would result in the loss of work for more than 200 clients that last year made more than $565,000 in wages. These individuals have been certified as disabled, by law are vulnerable adults, rely on transportation services, require 24-hour support and supervision, and cannot function independently at a business or they wouldn’t be in our program. What are they to do if there is no work?

WHY THE CHANGE-Newtrax Transforms Transportation

On November 7, 2011, Newtrax, Inc., will begin to transport over 500 clients of both Merrick, Inc., and Phoenix Alternatives, Inc., (PAI) between their homes and five program sites. This is a major change for Merrick in that an external, although related, company will be transporting clients and that a two-route system will replace the current single route model. This new system also means the current program hours of approximately 8:15 a.m.-1:45 p.m. will expand to approximately 8 a.m. - 3 p.m., requiring our staffing schedule to change from 7 a.m.-3 p.m. to 6:30 a.m.- 4:30 p.m.

We acknowledge that change is often difficult and, in this case, cannot be avoided because of the rate cuts. The majority of drivers for Newtrax will be our existing drivers who already have a relationship with clients of Merrick and PAI. We realize clients value the time they spend in transit between home and their program site, and will continue to strive to make it a positive experience. Ultimately we believe that clients and our employees will benefit from this change through new relationships, quality program services, and stable company finances.

In addition to the route changes, the schedule changes mean that the same number of clients will need the same support from the same number of staff over a longer period of time. This poses some significant challenges for our Program Division and is worth telling the story behind the change.

In January 2010, the Merrick, Inc., Board of Trustees held their annual strategic planning session, in part, to assess and establish the company’s three – five year goals and related key strategies. The Board had recognized for some time that the company could no longer depend on the current percentage of revenue from government sources and had to offset expected rate cuts by generating more revenue from the non-government sector. With that in mind, as Executive Director, one of my strategic initiatives became to acquire a related day service program. On July 15, 2010, Susan M. Warweg announced her retirement as the Executive Director of PAI at a quarterly Ramsey County provider meeting. Anticipating at least a three percent rate cut on July 1, 2011, and with the strategic initiative to acquire a related day service program, I approached Susan about the possibility of a merger as an alternative to hiring another Executive Director for PAI. After considering this option, PAI declined the offer, but stated their interest in working collaboratively with us in some manner. After some time to reflect, I offered another option that would preserve the unique mission, culture, and services of each non-profit (its “color”) by establishing a third non-profit that would exist to deliver “non-mission” services to Merrick and PAI. Susan and her Board were intrigued by this idea. Mike Greenbaum, Merrick’s Finance and Development Director, and Terry Higgs of PAI joined with Susan and I in exploring this third non-profit concept. After several months of discussion and planning, on January 7, 2011, Newtrax, Inc., was incorporated in the State of Minnesota with the objectives to:

(i) Ensure safe, accessible, and reliable transportation for clients of Merrick and PAI;

(ii) Maximize operational efficiencies to reduce expenses and stabilize services in anticipation of less government reimbursement;

(iii) Develop strategic collaborations that increase the potential of each organization to deliver services to their respective clients; and

(iv) Contribute to the overall health and well being of our communities by reducing the number of vehicles congesting roads and vehicle emissions.

Newtrax was incorporated with the ability to provide other services to its members and/or to add additional non-profits to its membership with the mission - To increase the potential of each member organization to advance their charitable mission more effectively and with greater efficiency.

Ultimately the State of Minnesota reduced our rates by 1% effective September 1, 2011, and it is nearly certain that another 1.67% reduction will be applied on July 1, 2012. The collective impact of those reductions on Merrick is approximately $160,000 annually in revenue that cannot be fully replaced from other sources and would seriously compromise our ability to provide the quality of services expected by clients, their families, regulatory agencies, and the community at large. Our three largest expenses, in rank order, are:

· Wages;

· Transportation; and

· Facility costs (i.e., mortgage/lease, operating, & maintenance).

Our services must comply with a host of licensing regulations, the most relevant of which is staff to client ratios, which limits our ability to reduce wage expenses. Because we own an energy-efficient building there is little savings to be found in the facility cost center. As a result, reducing transportation expenses through Newtrax offered the greatest opportunity for cost savings because each organization operates in that same service area, under the same regulations, with an extensive fleet of similar vehicles. In the first year of operations, it is projected that Newtrax will be able to provide transportation services to all 534 clients at an anticipated cost savings of $150,000 annually to both Merrick and PAI permitting each to maintain its services and supports despite the rate reductions. For more detail on the transition to Newtrax, visit www.merrickinc.org and click on “Transportation Updates”.

The consolidation of transportation routes among member organizations by Newtrax offers not only the potential for significant cost savings to the programs and clients served, but also a meaningful reduction in congestion, air pollution and carbon emissions contributing to the overall health of the local communities in which we operate. Using an estimate from the book “Cradle to the Grave”, (Umwetlund Prognose-Institut Heidelberg, 1993), the environmental cost of one car is as follows:

· 26.5 tons of waste and 32,560 cubic feet of polluted air to extract the raw materials to manufacture a car;

· 1.5 tons of waste and 2,613,285,326 cubic feet of polluted air to manufacture the car;

· 40 pounds of abrasive waste and 35,879,701 cubic feet of polluted air in driving the car; and

· 3,602,095,990 million cubic feet of polluted air to dispose of the car.

Newtrax will be able to transport all Merrick and PAI clients with 15 fewer vehicles than was required by Merrick and PAI separately. Not only will this reduce road congestion in our local communities, more importantly it will eliminate an estimated 420 tons of waste, 600 pounds of abrasive waste, and 93,769,463,655 cubic feet of polluted air which is the equivalent waste produced by 49,500 residential homes. Further, from the report “Benefits of Community Trees” (David J. Nowak, Brooklyn Trees, USDA Forest Service General Technical Report), a healthy tree stores about 13 pounds of carbon annually – or 2.6 tons per acre each year. An acre of trees absorbs enough carbon dioxide over one year to equal the amount produced by driving a car 26,000 miles. Based on our preliminary routing schedules, we expect to reduce the miles driven to transport all 534 clients by 300,000 miles per year, the equivalent of planting 11.5 acres of trees a year in our local communities.

We know this change might cause some issues for both clients and staff as they adjust to the new ride and schedule times. Still, it is our best option given current and projected rate cuts at the state level and continued funding uncertainties at the federal level. We believe that the development of Newtrax supports each non-profit’s mission and protects the quality of our core services in these economically uncertain times. Our dedicated staff will do all we can to ease this transition for our clients. If you have further questions on the transition, please contact me at either 651-789-6209 or This e-mail address is being protected from spambots. You need JavaScript enabled to view it

In future issues of Bark’s Bytes I will share some of the social enterprise ideas and other strategies we plan to implent to further reduce our dependence on state and federal funding.