HdL can simplify the tedious process of negotiating your indirect cost rate and reviewing your grant portfolio to maximize and sustain your grant funding.

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Imagine being awarded a federal grant and not utilizing the full amount. It’s preposterous because you would never leave money on the table! Now imagine the other extreme – your agency is awarded a federal grant, but the ongoing cost of the implemented program is millions more than what was awarded. Unfortunately, this fundamental lack of strategy and awareness is commonplace. 

General fund hidden costs grant funds HdL CompaniesMany agencies are adept at the grant management process – searching for funding opportunities, checking eligibility, applying, application tracking, accepting and implementing the grant, and finally, completing financial and programmatic reports to closeout. Spending grant dollars on direct program cost is the easy part. However, it’s quite common to overlook the true cost of programs – to go beyond the basic expenditures of a program and consider the hidden costs associated with staff hours, payroll, IT services, etc. While not identified with a specific grant project function, these expenses are necessary. The General Fund certainly feels the burden, but it is disguised among all General Fund expenses. Exposing these hidden costs is the first step toward maximizing and sustaining grant funding, making sure that your agency is getting all the money it’s entitled to. 

Maximize Grant Funding

Today, an unprecedented amount of money is flowing to keep local governments and their business communities thriving through federally funded grant programs. Unfortunately, with ever-evolving legislation (e.g. 2CFR guidelines, ARPA funding, etc.), a tight labor market, and a lack of resources, it’s hard to keep track of all the opportunities available. Congress has provided $5.7 trillion in fiscal support since early 2020.

The bad news is...

$800 billion remains unspent or uncommitted, according to the Committee for a Responsible Federal Budget.

The good news is...

OMB guidelines related to grant expenditures have changed over the last few years, landing on more lenient allowability for recovering indirect (hidden) costs spent from the general fund.

The even better news is... 

This allowability is above and beyond Admin Caps and costs… meaning that if your agency has past grant awards that were not fully drawn down, the remaining award dollars can be used as reimbursement for indirect costs incurred, thus maximizing your agency’s grant funding!

Cost allocation grant management HdL Companies

Sustainable Grant Funding

Once the grant dollars have been maximized, it’s time to ensure the programs born from grant awards are sustainable and not short-lived. For example, several years ago the Department of Justice handed out police body camera grants. Many agencies embraced the opportunity for more transparency within their communities and implemented a body camera program. Unfortunately, many unplanned costs occurred – city attorney hours spent in litigation, city clerk hours spent responding to open records requests, IT’s need for additional storage for camera footage, etc. The program ended up costing millions more than the grant awarded and created a situation that was unsustainable in the long-term. In similar scenarios, agencies are forced to find revenue elsewhere (oftentimes by increasing taxes) or discontinue the program. Awareness of the true cost of a program will facilitate informed decisions when applying for grants and put your agency on the road to sustainability.

Indirect cost recovery is complex, which is why it’s time to start having these conversations within your agency. In a recent poll of 200 counties, cities, and special districts, 59% claimed a lack of understanding and intimidation as their biggest challenges when it comes to maximizing grant funding. Agencies can’t afford to miss out on any funding. Knowing what you’re actually spending on programs and services is vital to transparency, accountability and fiscal health.

HdL is the only provider to manage the indirect cost recovery process from beginning to end. To review your grant portfolio and determine any and all available grant funding going back two years, contact SME This email address is being protected from spambots. You need JavaScript enabled to view it..

 

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