Northeastern SPPUA students and alumni at “Leaving Money on the Table: The Challenge of Unspent Federal Grants” in Washington D.C. Photo courtesy of the Lincoln Institute of Land Policy
By Betsy Gardner
Last month I had the honor of representing my fall 2016 capstone group at “Leaving Money on the Table: The Challenge of Unspent Federal Grants,” a Washington D.C. roundtable co-hosted by the Lincoln Institute of Land Policy.
In 2008, the Government Accountability Office (GAO) found $994 million “left on the table” in the form of undisbursed federal grants. This means that almost $1 billion intended for block grants, infrastructure, education, and other municipal priorities is sitting unused in grant accounts. Why is this happening? It could be the result of funds that have been awarded by a federal agency but have not yet been drawn down by the grantee, or grants that have yet to be formally “disbursed” by a federal agency.
Although the GAO and a few senators have highlighted their concern regarding unspent funds, this issue has not been very thoroughly researched and is just beginning to receive more comprehensive attention. Therefore, the Lincoln Institute of Land Policy, an independent nonpartisan organization focused on land use planning and municipal finance, tasked our capstone team, composed of four students from the School of Public Policy and Urban Affairs (SPPUA) at Northeastern University, to research federal grant oversight and administration practices in cities. Team members include Joe Russo, Annaise Fourneau, Andrew Bryant, and myself.
The investigative report we wrote included a literature review, four city case studies and a matrix of recommendations based on our research findings. Our team explored the issue of unspent grant money from a municipal perspective and sought to identify the root causes of the unspent funds in order to inform training and education around the best methods for federal grant management, utilization, and close out.
Our methodological approach classified cities by geography, fiscal health, financial practices, and dependency on federal grant awards. This diverse picture gave snapshots of a recovering city, responsible city, regional city, and responsive city. We classified the cities based on data from federal and city audits, reports by the GAO and Congressional Research Service, and the Fiscally Standardized Cities database. Additionally, we conducted interviews with public officials, consultants, and experts on municipal fiscal health.
Our initial research led to a matrix of recommendations in three areas: organizational capacity, audit and oversight, and information technology. Despite the varied classifications, each case study city experienced challenges in those three areas, which prevented them from using the federal funding they were awarded.
On March 7, the Lincoln Institute co-hosted “Leaving Money on the Table: The Challenge of Unspent Federal Grants” with the Pew Charitable Trusts and the Council of Development Finance Agencies to deepen the discussion among various levels of government, nonprofits, and the private sector. The goal was to explore the challenges of unspent federal grants in the context of the intergovernmental transfers system in the United States. I presented on the first panel, “The Federal Grant Process and Emerging Scholarship,” with Tom Jones, of the GAO, and Natalie Keegan, of the Congressional Research Service. Jenna DeAngelo, a program manager at the Lincoln Institute and recent SPPUA alumna, moderated the panel.
Our capstone team’s original research was of particular interest at the roundtable, as it provided a perspective that was lacking in both the academic community and the federal government, and shed some much-needed light on the reasons why some grant money isn’t being spent.
A consistent theme from the day was the immense work still to be done on unspent grants. All of the panelist and the audience were energized and passionate about continuing the effort sparked by Lincoln’s leadership on this issue. Over the course of the day many attendees spoke with myself, Joe Russo and Annaise Fourneau, about the importance of our research. Andrew Bryant, the fourth member of our group, was not able to attend the event as he is in active Army duty at Fort Leavenworth in Kansas.
Although we graduated in December 2016, this important work continues to be carried forward by a current group of SPPUA students, who are surveying cities’ federal grant challenges as part of their spring capstone project with the Lincoln Institute. It will be very exciting to see how all our work raises awareness and contributes solutions to the challenges of unspent federal grants.
Betsy Gardner is a graduate of the MS in Urban and Regional Policy Program, and currently works in Boston as a facilitator, consultant, and mediator. She specializes in conflict resolution and women’s economic development. Betsy has worked with the New England Patriots, MIT Sloan School of Management, the U.S. Coast Guard, Major League Baseball, and the Massachusetts Attorney General’s Office.