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Agenda Item 8BAGENDA ITEM # 8B DECEMBER 12, 20l l Report on Grant Application /Administration Costs December 05 2¢1� Prepared by Davi mpson Purpose: The purpose of this report is to discuss the administrative time and costs associated with grant procurement and management. Recent questions by elected officials relative to these costs require some background information and historical perspective. This also requires some discussion of the different types of grants as well as the different rules for grant administration. Types of Grants Formula Grants: "Formula grants" are basically funding sources whereby the distribution of funding is based on a pre -set formula for the allocation of money. For example, Community Development Block Grants (CDBG) are allocated by the federal government to states, which allocate their share of funding to the counties, which allocate funding to the municipalities. At each stage, the available funding is based on a formula that includes population figures. CDBG funding specifically targets low income populations. The various governmental entities are not in competition for the funding. The funding is allocated based on a formula. The Interlocal Agreement between Jacksonville and Atlantic Beach specifically states the formula that is used for the annual allocations. Competitive Grants: "Competitive grants" are somewhat self - explanatory. When these funds become available, various public and private entities compete for the funding. They must meet the essential criteria required in the application process, and they must be able to compete with others who want the same funding. The applicant with the "best" application and project will succeed, while others are not funded. Application Administration For most formula grants which include CDBG and Justice Assistance Grants (JAG), the application process is mostly a formality. The decisions relative to the allocation of funding are typically determined by some group of officials, and then a staff person completes the paperwork or application online. Depending on the complexity of the program, the application process may be completed in a few hours, or it may take several days. For example, using JAG funding to purchase a camera should only take a few hours of administrative time to complete the application. Another example would be a JAG application for new software which will require an Automated Data Processing evaluation that may take a several days to research and document. A JAG application for task force operations may require additional commitments and signatures from other agencies, and commitments to a number of administrative functions. Although all of these are JAG grant applications, they create very different demands relative to time and costs. For competitive grants, the application process is typically much more complex and labor intensive. The fact that there is no guaranty of a grant award makes the entire process more risky, and the competitive environment can limit the outside resources available for assistance. These applications sometimes require weeks or even months of work to compile the required data and prepare the application for submission. AGENDA ITEM # 8B DECEMBER 12, 2011 Once a grant announcement has been received, staff is required to review it in detail to determine what it is intended to fund, and to determine what it is not intended to fund. Once staff has gained some insight into the grant, staff must determine whether or not the City has any projects that legitimately qualify for the grant program. If there is a good match with a needed project, then staff must connect with department heads and /or other experts to plan out a course of action. The grant writer may be required to develop a significant amount of expertise in the field before they can develop the application. Competitive grants often require meetings with key grant administrators at local, state, and /or federal levels. For example, the Salt Air Sewer Rehabilitation grant required several meetings with administrators and engineers in different cities before the application was accepted at the earliest stages of the application process. Some grants benefit from the support of elected officials at various levels, and others score higher when they involve coalitions and teamwork with other entities. When competitors are able to reach win -win proposals, then it greatly increases the likelihood of approval. When all of the information has been identified and secured, then the grant writer must compile the data, maps, studies, etc. and complete the application form(s) as required. Many competitive grants have specific scoring matrixes that are used to evaluate the many applications. The grant writer must assure that the information is submitted such that it provides the highest point values for the review process. Once the application and data is completed and organized, then it must be submitted to the appropriate person by the application deadline date. In some cases, the grant writer or an informed city staff member will be required to field questions and make a presentation to those who are evaluating the application. The amount of time necessary to submit a competitive grant application is difficult to predict. In some past cases, well over 100 hours of staff time was required to compile the data and submit a successful application. In other cases, longstanding coalitions and partnerships have greatly reduced the staff time while insuring successful outcomes. Grant Administration Grant administration includes the acceptance of the grant award, and complying with the grant requirements to assure that the purchasing is conducted in accordance with the grant requirements and the City Code. It also includes the reporting, tracking, documentation, and submitting appropriate data to facilitate reimbursements from the grant source. Failure to follow the guidelines can jeopardize the grant funding. As with the application process, the administration process can be very simple, or it can be very labor intensive and time consuming. This may be a factor of the organization and other grant people who are monitoring the grant administration, and /or it may be a factor of the type of grant program. For example, a JAG grant for police equipment will typically be a simple process, but a JAG grant for a Drug Task Force operation will require extensive documentation and data collection. An example of other organizational demands would be the difficulty associated with the Donner Park Sewer Rehabilitation project where there were more than 100 pages of purchasing guidelines being interpreted by people from federal, state, and local levels who did not agree. General Comments: Many grant programs allow for administrative costs to be funded from the grant itself. Typically, administrative costs are capped at about 10% of the total grant funding. Sometimes AGENDA ITEM # 8B DECEMBER 12, 2011 this covers the costs, and other times it does not coverall of the costs. When Jacksonville was designated to receive an allocation of energy grant funding, they immediately asked for administrative costs, and they hired people to administer the grant. When the funding runs out, then the grant administrators will no longer have jobs. Atlantic Beach has not typically requested administrative expenses when applying for grants. The grants are not usually large enough to hire full time people, and the accounting can be very cumbersome and time consuming. Atlantic Beach has contracted out grant writing services in the past, but it was not very productive. An outsider rarely knows the needs of the City, and City staff members may not even be aware of the grant opportunities. It requires an intimate knowledge of the City and its operations and projects to match grant opportunities to projects. When it comes time to prepare an application, the Atlantic Beach staff members do most of the work and the grant writerjust compiles, organizes, and submits the documents. When the grant writer obtains a grant award, then the administration of the grant falls back to City staff members who may or may not know how to administer the grant funding. The value of having someone who knows the needs of the City, the City procurement processes, and the people at local, state, and federal levels cannot be overstated. Many of Atlantic Beach's successes have been the result of building positive relationships with others in the industry, combined with some creativity and perseverance. Summary: In many cases, staff will be able to predict the time and resources necessary for submitting grant applications, especially for repetitive, formula grants. In other cases, the application processes may evolve into long term initiatives that requires hundreds of hours of work. Relative to administration, the same conclusions hold true. Some small repetitive grants can be handled with very little effort, while others take hundreds of hours to complete. Staff should be able to provide accurate estimates for some projects, while other projects will take on a life of their own.