Tag Archives: Earmarks

Earmarks could come back: That’s great news for governance and nonprofits

I was wrong about earmarks.

Like a lot of good-government types, I opposed earmarks (which are sole-recipient funds to specific organizations allocated by Congress) and thought earmarks were a sign of brazen corruption, like cash kickbacks from vendors to mayors. I didn’t oppose earmarks out of greed, although earmarks can be seen as bad for grant writers because any funding that’s earmarked isn’t available for grant-funded competitions—I saw them as basically immoral. Corruption is bad, so we should get rid of it, right?

But banning earmarks was (and is) a cure worse than the disease. Without earmarks, congressional leaders have limited tools to discipline members of their caucuses. Members are free to grandstand, vote on principle, and block useful legislation in order to pander to primary voters, rather than general election voters. You, dear reader, may initially think it’s good to vote on principle—as long as the principle is one you uphold. But when it isn’t one you uphold, you’ll likely be angry. You’ll also be angry when Congress seems incapable of acting. Because of the way the United States is structured, there are many intentional chokepoints for legislation, and it’s much easier to block than pass legislation. As parties have become more polarized, we’ve gotten increasing legislative gridlock.

Without earmarks, voters have no incentive to vote for pragmatists who will bring the pork their district. Instead, they can vote for extreme partisans who engage in a lot of symbolic talk and votes without considering what’s really good for the country. When congressional leaders have earmarking power, grandstanding has a real consequence. When congressional leaders don’t have earmarking power, they can’t keep their caucus together and it’s much harder to cobble together the 60 votes needed to pass most anything in the Senate. In Congress, pragmatism is actually better than purity, but we’ve seen increasing ideological purity at the expense of a functioning country.

This is a post, not a book, so I can’t go into great detail about why and how this happens, but The Myth of the Rational Voter is a good place to start. I can say, however, that earmarks improve the incentives on legislators to cut deals and make sure the government can do something—anything, really.

Beyond high-minded principles, some nonprofit and public agencies will also be able to receive earmarks again. Pursuing earmarks isn’t in the scope of our business practice, but it is a useful thing to note.

This article, from 2016, gives some more earmark context on earmarks. This article, gives more context. Here’s a good Tweetstorm.

Note that no one is arguing that earmarks are perfect or that the process is without defect. When I’ve argued the case for earmarks to politically minded friends, they’ve told me that I’m a craven tool of corporate interests (let’s ignore the logic of that for the time being and just view it as a signaling mechanism). But earmarks are better than no earmarks; sometimes bad is an improvement over even worse. We’ve seen what happens to the quality of federal governance without earmarks to discipline congresspeople. It isn’t good. Bring ’em back. I admit publicly that I was wrong.

Here is an argument against earmarks, which I don’t find persuasive for reasons listed in the paragraphs above, but it is a reasonable view.

Getting Your Piece of the Infrastructure Pie: A How-To Guide for the Perplexed*

One of our favorite marketing sloganspie-1over the years has been, “We help you get your piece of the grant pie.” Well, Congress is cooking up the mother of all grant pies with the “infrastructure” component of President Obama’s stimulus package. If you’re wondering how your agency can get a bite of this tasty treat, you’re not alone. Peter Sanders and Christopher Conkey of the Wall Street Journal report in Mayors Struggle to Get Piece of Stimulus that even Los Angeles Mayor Antonio Villaraigosa has been unable to figure out how to get his fork in. I think Mayor Villaraigosa actually knows perfectly well how to step up to feed at the federal trough but was just being coy for a reporter not steeped in the ways of government largesse. After all, Mayor Villaraigosa was Speaker of the California House of Representatives and knows more than most about this topic. Essentially, the Mayor is unhappy that President Obama has said to no to earmarks, so he can’t just hang his favorite projects on the bill like Christmas ornaments. Instead, he and his minions will have to work for the money—no wonder he’s unhappy. For those readers not in the know, here is how the stimulus funds are likely to find their way to you . . .

Despite all the breathless reporting on the stimulus package, no story I’ve seen explains how thunder in Washington, DC will make it rain Pennies from Heaven** in Los Angeles. The answer depends on how the feds decide to get the money on the street, which will be in the bill that eventually emerges from Congress. Here are the four basic possibilities, assuming no earmarks:

1. Congress can fund programs, new or old, to be administered at the federal level through some sort of competitive RFP processes. In this case, any eligible entity can pitch any eligible project by submitting a proposal, which is more or less the way most discretionary grant dollars are distributed.

2. Congress could use the existing Economic Development Administration (EDA) Public Works and Economic Development Program to fund infrastructure and facility projects. Unlike any other federal agency, however, EDA uses a byzantine system of regional Economic Development Representatives (EDRs), which have to agree to pass your project up the food chain by inviting a “pre-application.” To get this invitation to the big dance, the project generally has to be listed in the region’s Comprehensive Economic Development Strategy (CEDS), which replaced the earlier Overall Economic Development Plan (OEDP) process. We’ve threaded our way through this particular maze many times, resulting in lots of funded EDA grants; although it’s daunting at first, it is eminently doable.

3. Congress can block grant funds to the states, who can then use existing systems to distribute the funds. For example, highway transit funds could be sent to states’ transportation departments, which could then fund projects ranked on the State Transportation Improvement Program (STIP) (see here for the California version of this). It’s not quite that simple because some regional TIPs feed into statewide TIPs, but the main point is that the project has to be on the relevant TIP(s) to get federal transportation dollars.

4. Congress can block grant funds to the states and/or large cities and counties, who can then run RFP processes to dole out the money, more or less in the way that Community Development Block Grant (CDBG) funds are distributed. For that matter, Congress could simple dump money into the CDBG pipeline, since every eligible jurisdiction already has a Consolidated Plan with dozens of prioritized projects they lack money to fund. I don’t think this will happen, because it is too simple, and where’s the fun in that?

Confused yet? Actually, all of this is fairly straight forward in the sense that the feds have to use one or more of these methods to get the money on the street. Your question involves the the best way to get in position for to catch the funds that are about to be pitched for infrastructure and facility projects. To do so, follow these easy steps:

1. Finalize the project design for any infrastructure-style project you have simmering and get as many of the permits and approvals as you can in the time you have. For example, having all environmental approvals and a building permit is ideal. Remember that federal funding typically triggers National Environmental Policy Act (NEPA) and, for those of you in California, California Environmental Policy Act (CEQA) requirements.

2. If you are a nonprofit, school district or college, see if you can entice the local city or county to be the applicant and fiscal agent for the project.

3. Develop submittal plans for all of the above options. The agencies that move fastest with the most “cooked” projects are likely to be funded.

After you’ve baked your project, lie down in a comfortable place with a good book*** while waiting for the legislation to emerge. Since we are not lobbyists, we never look at pending legislation early-bird-color-j-pegand instead wait for the sausage to be extruded. Until the stimulus bill is actually signed into law, no one can say exactly how an agency can apply. But it will be the Oklahoma Land Rush as soon as the ink is dry, so, “Start Your Engines!” As always, like Maimonides, Seliger + Associates is ready to offer a guiding hand to help you get your piece of the stimulus bill pie.

EDIT: See additional posts on this topic: Looking at the Stimulus Bill from a Grant Writer’s Perspective and Brush the Dirt Off Your Shoulders: What to Do While Waiting for the Stimulus Bill to Pass.

* My apologies to Maimonides for lifting this line.

** This is one of my favorite, if somewhat disturbing, movies from the early 1980s—another time of recession. The movie harkens back to the Depression, making it great viewing for the current economic meltdown. To paraphrase another song from the ’30s, “Brother, can you spare a trillion.”

*** I’ve been reading Love in the Time of Cholera. Nothing like Gabriel García Márquez to get me in the mood for the magical realism of the federal grant making process.

Stuck on Stupid: Hiring Lobbyists to Chase Earmarks

A faithful Grant Writing Confidential reader and fellow grant writer, Katherine, sent an email wanting my take on a public agency hiring a lobbying firm to seek federal earmarks. For those not familiar with the term, it means getting a member of Congress to slip a favored local project into a bill, bypassing normal reviews and restrictions. The Seattle Times recently ran a nice article on the subject featuring our own Representative Jim McDermott, who is skilled at the art of earmarks. The only member of Congress I know doesn’t push earmarks is John McCain. For the rest of Congress, earmarks are a way of funneling money into often dubious projects, such as the infamous Bridge to Nowhere.

Back to the local school district where Katherine lives, which decided to hire a DC lobbying firm for $60K/year to get earmarks. She suspects this is a scam. I have no idea whether this particular lobbying firm is up to no good, but in my experience hiring lobbyists to chase earmarks will make the lobbyists happy and lead to lots of free lunches and dinners for public officials visiting DC to “confer” with their lobbyist and legislators, though it is unlikely to end with funding.

A small anecdote will demonstrate this phenomenon. About 20 years ago, when I was Development Manager for the City of Inglewood,* I was directed by the mayor via the city manager to contract with a particular DC lobbying firm to chase earmarks. Since the city manager and I knew this was likely a fool’s errand, we agreed to provide a token contract of $15K. I accompanied the mayor and a few others to DC for the requisite consultation with the firm. About 10 in morning, we strolled from the Mayflower Hotel over to K street, where all the lobbyists hang out, and were ushered into a huge conference room with a 25 foot long table.

Over the next two hours or so, just about every member of the firm wandered in to opine on potential earmarks. Around 12:30, we all repaired to an expensive DC restaurant (are there any other kind?) for steaks and cocktails. We had a fine meal and I met then former Vice President Walter Mondale, who had morphed into a lobbyist himself and was taking his clients out for lunch. When I got back to Inglewood, I received an invoice from our lobbyist which exceeded the contract amount. Our contract paid for less than one meeting in DC and resulted in no earmarks. But I had a great time, since it is always fun to visit DC using somebody else’s money.

That experience schooled me on earmarks and about why Inglewood had gone about acquiring them in the wrong way. If a public agency wants to try for an earmark, the agency can do so just by contacting the chief field deputy for Senator Foghorn Leghorn. Congressional field deputies know all there is to know about the earmark process. If your representative is in a mood to support your project (e.g., needs help to get re-elected and wants to say they are standing up for schools), they will fall all over themselves directing their staff to push the earmark. If they don’t want to for some reason, all the lobbyists in the world won’t force the issue. In that situation, the school district might just as well use the money to buy lotto tickets in hopes of funding the project, rather than hiring a lobbyist. Furthermore, going through the congressional field office will avoid the EDGAR problems described below.

Another problem is that if you have almost all of the 535 members of Congress promoting various earmarks, the chances of your particular project being included are pretty slim. This is another reason we don’t recommend pursuing earmarks. If Katherine’s school district really wants to fund education projects, this is not the way to go about it. Instead, they should hire an experienced grant writing firm, like Seliger + Associates, to help them refine and prioritize project concepts, conduct grant source research, and start submitting high quality, technically correct proposals. If the concepts have merit, they will eventually be funded. The Department of Education and others provide billions of dollars in actual grant funds every year. This is a larger, more reliable source of funding than earmarks.

Finally, if an organization is lobbying, it can end up closing off grant funds. The “Education Department General Administrative Regulations” (EDGARs) govern grants and contracts made through the Department of Education, and they’re designed to prevent corruption, kickbacks, and the like. Subpart F, Appendix A, deals with lobbying. It says:

The undersigned certifies, to the best of his or her knowledge and belief, that:
(1) No Federal appropriated funds have been paid or will be paid, by or on behalf of the undersigned, to any person for influencing or attempting to influence an officer or employee of an agency, a Member of Congress, an officer or employee of Congress, or an employee of a Member of Congress in connection with the awarding of any Federal contract, the making of any Federal grant, the making of any Federal loan, the entering into of any cooperative agreement, and the extension, continuation, renewal, amendment, or modification of any Federal contract, grant, loan, or cooperative agreement.

And so on, which you can read if you’re a masochist. EDGAR basically means that an agency which pursues lobbying can end up screwing itself out of the much larger and more lucrative grant world.

Katherine has also found questionable math regarding the particular lobbyists’ probable efficiency, and the lobbyist also makes the dubious claim that it has a “90% success rate.” But what does “success” mean in this context? Does that mean 90% of clients get some money? If so, how much? And from who? And through which means? Seliger + Associates doesn’t keep “success” numbers for reasons explained in our FAQ. We constantly see grant writers touting their supposed success rate and know that whatever numbers they pitch are specious at best for the reasons described in the preceding link.

Public agencies hiring lobbyists for earmarks is often a case of being stuck on stupid.

* “Inglewood always up to no good,” as 2Pac and Dr. Dre say in California Love.