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Uniform Grant Guidance (UGG)“Aims to reduce the administrative burden on award recipients and, at the same time, guard against the risk of waste and misuse of Federal funds.” (grants.gov)
Digital Accountability and Transparency (DATA) Act“The nation’s first open data law. It requires the U.S. federal government to transform its spending information into open data.” (datacoalition.org)
Treasury “Do Not Pay” Initiative“The purpose of this order was to reduce improper payments by intensifying efforts to eliminate payment error, waste, fraud, and abuse in the major programs administered by the Federal Government, while continuing to ensure that Federal programs serve and provide access to their intended beneficiaries.” (fiscal.treasury.gov)
Grant Reporting Efficiency and Assistance Transparency (GREAT) Act“The proposed law will transform federal grant reporting from disconnected documents into open data by directing the executive branch to adopt a standardized data structure for the information grantees must report to agencies.” (datacoalition.org)
Many local governments fall prey to not diversifying their grant portfolio, thereby, the loss of one grant will severely cripple a program. Municipalities and counties will over-rely on one grant source, failing to balance grants with other income-generators like sales and property taxes, permit fees, and court fines.
When applying for grants, be sure to apply only for grants in which you are eligible and that align with your local government’s goals. When growing your grant portfolio, use a grant research database to efficiently identify applicable federal, state, and foundation opportunities. Also, run an audit on existing income sources to determine your municipality or county’s current mix, sustainability of revenue sources, and existing or future gaps.
There are a number of people and departments involved in the grant lifecycle, especially for local governments because of the prevalence of sub-recipients. The more people included in the process, the more difficult it is to maintain internal controls, and GAO audits have identified that there are already clear deficiencies in internal controls of grant management. A lack of internal controls negatively impacts grant awarding, eligibility, proper fund allocation, and proper financial statements.
Ensure a separation of duties across key accounting processes—recording transactions, authorizing transactions, and housing program assets. Train staff appropriately on internal control processes and grant standards.
Another solution to improving internal controls is having a centralized hub for your grants. This is especially helpful for local government because sub-recipients are often involved. Instead of using disparate systems, consolidate your information on one system to consolidate information and keep everyone from your team to your sub-recipients on the same page.
Standardization and an increased focus on performance make it harder for local governments to manage grants in traditional spreadsheets and word processing documents. These tools lack the built-in reporting capabilities and organization required to efficiently meet specific and non-negotiable budgeting and reporting requirements from federal agencies.
Grant management software can simplify the process by helping you:
Capture all elements as data throughout the entire grant ecosystem
Automate financial and programmatic reporting
Receive real-time snapshots of program effectiveness and internal status reports
Manage and account for all activity down to the sub-recipient level
Easily integrate with Enterprise Resource Planning (ERP), financial and accounting, and HR/payroll systems
Consortia grants, or grants in which two or more entities work together to achieve a goal, are common in cities and counties. The public sector also benefits from working with nonprofits, particularly when executing on social service and public welfare programs. Nonprofits often have existing infrastructure and staff in place to solve specific local needs and are more agile in their operations.
An increase in participation in grant execution requires more sophisticated and organized management processes. As prime recipients, municipality and county governments must educate their sub-recipients on federal reporting guidelines and requirements, most notably those stemming from the recently enacted GREAT Act and the DATA Act. Local government must then collaborate with sub-recipients to hit timelines, deliverables, and performance requirements.
Create a shared log of responsible parties and tasks, so that all involved are aware of expectations and roles
Document project scope, expectations and intended outcomes in detail. This is especially important for multi-year projects
Record task and reporting timelines in an easily accessible, centralized location
Regularly generate reports to track sub-recipient activity and performance
Improper allocation of grant funds can lead to missed drawdown or even repayment to the funding source. A number of local governments have had to make repayments of hundreds of thousands of dollars to reconcile errors.
Monitor spend and performance regularly. Reconcile balance sheets, review bank and investment accounts, and run financial expenditure reports (e.g. expenditures by project, time/cost versus budget, cost and trend). Flag unusual activity.
Carefully read grant guidelines and acceptable use policies. Understand what types of expenses are allowable.
Limit online access to bank and investment accounts.
Keep accurate expense report and receipts for all purchases. Verify that these expenses are charged to the correct project and grant, that funds were spent within the approved timeframe, and that all supporting paperwork has been submitted. For grant-funded compensation expenses, back Time and Effort reports with accurate timesheets.
Keep all grant-related paperwork centralized, including allocation plan(s), vendor invoices, cancelled checks, travel logs, and timesheets. Use a consistent naming scheme and filing structure so that information can be easily referenced.
Ensure a separation of duties across key accounting processes—recording transactions, authorizing transactions, and housing program assets. Train staff appropriately on internal control processes and grant standards.
Stick to grant deadlines. Don’t lose potential funds because you missed an important action or date. Use a calendaring system and automated reminders to keep milestones in check.
Seek pre-approval from the grantor prior to redistributing funds, particularly if budgets or project scope change from what was presented in the original grant proposal.
