From FOMO to just 'MO'
Cities are already losing out on grant money. How will they manage all the new federal funding programs?
Happy Finance Friday, readers!
With the billions of dollars in new federal funding that’s been made available over the past two years, local government officials have understandably had some serious FOMO, or fear of Missing Out. Between pandemic fatigue and a staffing crisis, governments are already feeling pressure. Navigating new federal program requirements and applying for and managing that funding is a lot to take on.
Recently, two cities lost out on millions in federal funding largely due to their inability to keep track of it. They won’t be the last.
A $10 million opportunity cost
Staffing shortages in Baltimore and Oakland, California, played a major role in those cities losing access to federal grant funding for social services, according to news reports this week.
In Baltimore, the Mayor’s Office of Homeless Services, or MOHS, was forced to relinquish $10 million in funding from the U.S. Department of Housing and Urban Development for a program that is supposed to house the city’s homeless population. Records show that for at least a three-month period in fiscal year 2020, MOHS was unable to access the grant system and tap into those funds because employees either left the office or were barred from access. The loss of funding is a symptom of broader issues with the city's distribution system for the funds, which leaders say has been critically challenged for years.
In Oakland, the police department missed out on an opportunity to receive millions in state funding to combat organized retail theft due to officials bungling the grant application process. City staff had reached out to several groups for input on the application, but the process lacked a ring leader and Oakland’s grant proposal was missing documents when the deadline passed. San Francisco was awarded more than $17 million from the retail crime prevention program, and it’s reasonable to think that Oakland could have received a comparable amount.
The city is now looking at hiring a grant writer to streamline the process and prevent future errors, the San Francisco Chronicle reported.
“At the end of the day I think that responsibility falls on me as director, making sure that staff is well-resourced, and that I check in… making sure that if we are saying we are going to help support in writing this grant, that we are going to execute and accomplish that,” said Sofia Navarro, the interim director of Oakland’s Economic and Workforce Development Department. “I take ownership in making sure that is done appropriately.”
Bottom line, this is just a teaser for what’s to come. It's worth noting that neither of these missed opportunities involves programs from the Bipartisan Infrastructure Act (BIA) or the Inflation Reduction Act (IRA). However, if local officials already lack the capacity to manage all their grants now, they won't be able to take advantage of the new opportunities in the coming years without some assistance.
Next we’ll look how the feds (and others) are offering to help and how well that’s gone in the past.
Who’s offering help and how to pay for it
The feds…
…are well aware of local governments’ struggle with capacity for managing grants which is why the Biden administration says it is putting “unprecedented focus on providing technical assistance to local communities.”
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