Posted on 1 Comment

Federal Budget Battle Unfolds, But the RFPs Just Keep Rollin’ Along

Last Sunday, I wrote about the Obama Administration’s emerging planned Federal FY 2011 Budget Cuts. Not to be upstaged and right on cue, this week the House Appropriation Committee released a press release regarding Republican plan to cut the budget, CR Spending Cuts to Go Deep, which proposes $58 Billion in “non-security discretionary spending reductions” in this fiscal year.

Curiously, some of the grant programs on the Republican chopping block mirror the Obama administration’s proposed cuts (e.g., CDBG and CSBG). Some others, which are probably of most interest to our readers and clients, are LIHEAP (I am not making this acronym up—Google it), SAMHSA (not clear which programs), CDC (no details on which programs), Rural Development Services, WIC, and $2 billion from various job training programs. The Appropriations Committee has targeted 70 grant programs for reduction this fiscal year via the next Continuing Resolution (CR), which is supposed to be adopted by March 4. The Obama Administration’s FY 2011 budget will be released this week. The Republicans will presumably lambast it. Should be an interesting few weeks. As I opined last week, while I think it likely substantial reductions to both this fiscal year and next fiscal year grant programs will result from this brouhaha, the numbers will be somewhere in the middle.

Since our crystal ball is in the shop and we can’t know the future, Seliger + Associates just keeps on keepin’ on writing proposals in response to the flood of new RFPs that continue to be issued. Here are few that have been issued in recent weeks:

The vast majority of federal RFPs are issued in the January to July timeframe. To paraphrase Oscar Hammerstein, the government grant making machinery jes’ keeps rolling along as the budget debate unfolds. If you seek federal grants, don’t give up. As in Paul Robeson sang in the revised 1938 lyrics for Ol Man River, “But I keeps laffin’/ Instead of cryin’ / I must keep fightin’; / Until I’m dyin’, / And Ol’ Man River, / He’ll just keep rollin’ along!”

Posted on 1 Comment

As Predicted in January 2010, the “R” Word, Rescission, is Finally Here

Every January for the past three years, I’ve written a post about why it’s a great time to apply for federal and state grants. Here I go again: this post explains why nimble organizations will start the New Year by kick-starting their grant writing efforts, albeit for a different reason than in past Januarys.

Now that Congress is back in session, the federal deficit and spending are at the front and center of political debates. Patrick O’Connor and Janet Hook covered this in their January 3,2011 Wall Street Journal article, “Congress Targets Spending”. They write:

. . . Republicans in the House say they plan to move on to offer a far more sweeping package of “recissions,” or elimination of spending previously approved, that will aim to bring domestic spending back to where it was before Mr. Obama became president.

Ah, there’s the “R” word, rescission.* Faithful readers will recall that I predicted this in a post I wrote almost a year ago, “Federal Budget Freeze Prospect Making You Shiver? Don’t Panic Until You Hear the “R” Word: Rescission.” As I wrote then, rescission should “strike fear into your hearts” because the potential creates vast uncertainty in federal grant writing and state grant seeking (many state grants are derived from formula federal grants). I have no idea which grant program budget authorizations, if any, will actually be rescinded—which requires making it through the House, Senate and presidential signature—but, given the tenor of the political debate, I assume at least some will.

One of the things that makes the prospect of rescissions this year so curious is the fact that Congress never adopted a FY 2011 budget, opting instead for a series of Continuing Resolutions, the latest of which will expire in March (see this recent post on the subject, “No FY 2011 Federal Budget? As Is Said in Jamaica, No Problem Mon!“). Thus, rescissions could begin in the most recent CR, which is more or less the FY 2010 budget, or may be included in a FY 2011 budget, if a budget is actually adopted in March.

For grant seekers, the important part in all of this budget mumbo-jumbo is the critical need to respond to every RFP that appears in the next few months, because the program may be rescinded or otherwise subject to the budget axe. Federal and state agencies will be scrambling to issue RFPs ahead of possible rescissions because they know that the applicant pool will become a built-in lobbying force against rescissions. Every program officers want greater budget authority, not less.

In essence, the more RFPs that are issued and the more applicants there are for programs, the lower the probability that rescissions will harm a funding agency’s program. In counterpoint, some nonprofits will be scared away from responding to RFPs because they think their funding might be rescinded. The nonprofits that apply despite the potential for rescission will have a better chance for funding, particularly if they scream at their representatives to preserve budget authority for programs of interest. Since grant applicants are not shy and elected officials, regardless of party, are inherently interested in spending OPM (“other people’s money”), there should be lots of grants for those organizations who hop on every grant bus that trundles by in the coming months.

One possible program that’s a good target for rescission appeared in this week’s e-mail grant newsletter: HRSA’s Affordable Care Act: Health Center Planning Grants. It’s a planning grant program, which means that it won’t affect services that are already being delivered directly to people. More importantly, however, it’s also part of the Affordable Care Act, which lots of incoming congresspeople oppose, and one way to attack previously passed legislation is by refusing to fund it—or to rescind whatever money is already allocated to it. Only $10 M is available, and the maximum grant amount is just $80,000. Rescinding its funding wouldn’t cause a lot of problems but would show symbolic unhappiness about the Affordable Care Act.

* There seems to be a bit of confusion about spelling “rescission.” My spell checker likes “rescission,” but sharp-eyed readers will note the WSJ spells it “recission.” To paraphrase one of my favorite actor / singers (oh, and he also danced a bit), Fred Astaire to Ginger Rogers in “Shall We Dance”, “You like potato and I like potaeto,You like tomato and I like tomaeto; You like recission, I like rescission; Potato, potaeto, tomato, tomaeto, recission, rescission! Let’s [not] call the whole thing off!”. Given the tough economic times, it seems appropriate to think of a song from a 1937 movie.

Posted on 3 Comments

Be Nice to Your Program Officer: Reprogrammed / Unobligated Federal Funds Mean Christmas May Come Early and Often This Year

I hope faithful readers who are also federal grantees have been nice to their Program Officers, because this could be the year that Christmas comes early and often.

I recently wrote about the unfolding FY 2011 federal budget fiasco. While cruising in the droptop to Palm Spring this weekend to visit relatives, I got to thinking about the next step: what happens when the Republicans win control of at least one house of Congress? Regardless of one’s politics, this looks certain. We’ll have a lame-duck Congress for a few weeks, during which a budget is unlikely to pass, and then an all-out political brawl when the new Congress starts fulminating on January 3. I’m guessing that the budget won’t get resolved until around March, which means the feds will probably operate under Continuing Resolutions for another three to six months.

If you have a direct federal grant and have been a good boy or girl this year by obligating your grant funds, filing timely reports and doing more or less what your grant agreement calls for (e.g., offering family support services but not leasing Porsches or going on site visits to Bimini), Santa may drop in. Provided that the stars align perfectly by having a full-scale budget rumpus unfold, preventing budget adoption by the lame duck congress, the political appointees who run federal agencies (e.g., the Under Secretary of Education for Undersecretarial Affairs) will quickly realize that they need to spend existing budget authority under their Continuing Resolutions ASAP or risk losing the money when the Federal budget is finally adopted.

In some cases, this will mean hurried-up RFPs processes, like the Department of Treasury’s CDFI program, HUD’s Healthy Homes Production Production Program (open, but with short deadlines), and the Department of Education’s Talent Search program (expected to be issued 10/22 with a deadline of 12/9—see theDraft Talent Search RFP for a glimpse of Days of Future Passed.* In other cases, however, the Program Officer may skip the RFP process entirely, however, and request applications from existing grantees. If you are a grantee, don’t be surprised if you get a call or email from your Program Officer in the next few weeks or months asking for a proposal with a week or two turnaround. While you’ll have to submit a technically correct proposal and be willing to accept whatever offer is made, you’ll have no competition. Just submit the proposal, sign the contract, and off you go!

In addition to trying to spend existing budget authority, Program Officers also sometimes have returned grant funds they need to “re-program.” This happens when a grantee screws up their grant, and, assuming that the grantee hasn’t obligated (there’s that word again) their funds, the Program Officer cancels the contract and takes the unobligated money back. To avoid losing the money when the next budget arrives, the Program Officer will sometimes unload the funds on another grantee she likes.

We wrote a funded HUD Lead-Based Paint Hazard Control (LBPHC) Program grant in the FY 2009 funding round, which was one of only about 30 grants awarded. Last week, I was talking to this client, and he told me that one of the other grantees had already had their grant pulled because of inactivity. The grantee simply couldn’t get their program launched and the HUD Program Officer lost patience. This gives the LBPHC Program Officer another $2 or $3 million for re-programming. I told our client to be ready for the re-programming call—and so should you!

I’ve experienced the joy of re-programming a few times before I was a consultant. When I was Development Manager for the City of Inglewood in the 1980s (per 2Pac, “Inglewood always up to no good”, I wrote about $20 million in funded FAA grants to support redevelopment under the city’s Airport Noise Control and Land Use Compatibility (ANCLUC) program. This was during the Reagan/Congress budget battles and I was invited to submit a last minute ANCLUC proposal once or twice when my Program Officer got the shanks (note for non-golfers: this is different from “being shanked” in prison).

I’ve heard similar tales from clients and others over the years. Between re-programmed funds and the irresistible urge of Program Officers to shovel money out before the budget door slams shuts, a perfect storm for multiple Christmases is brewing. If you get such a call and feel like sharing, post a comment and we’ll keep you anonymous. Let the grant holidays begin.

* This over-the-top pretentious Moody Blues concept album reminds me of my early grant writing days, as I listened to it about a thousand times in 1970s while I scribbled proposals on to seemingly endless legal pads—not an iPad.