Public dollars for nonprofits scrutinized, funding announced
Increased scrutiny and accountability have forced the hand of the Jacksonville City Council to change the way in which it funds local nonprofits. In the process of implementing change, however, the Public Service Grants (PSG) process that provides funds to help Jacksonville’s most vulnerable adults and families has been upended.
On Sept. 28, 2021, when City Council approved requests for pandemic-related economic harm from nonprofits run by four of its council members, some community members, including The Community Foundation for Northeast Florida and the PSG Council, cried foul. The perception was that council members were using their position to fund pet projects.
The Community Rehabilitation Center, a nonprofit run by Council member Reggie Gaffney, received $500,000. Clara White Mission run by Ju’Coby Pittman, also a Council member, received $100,000, as did Read USA run by Terrance Freeman and Boys and Girls Club of Northeast Florida where Kevin Carrico is vice president.
By receiving those funds directly from City Council, those nonprofits circumvented the work of the PSG Council, the advisory body of 15 community volunteers that was formed by the city of Jacksonville in 2016 to ensure that tax dollars are wisely spent. These volunteers commit countless hours of their time to screen and vet detailed applications from nonprofits.
The public backlash caused the City Council to propose legislation to require nonprofit organizations that employ City Council members to compete for city grants in the same public service grant (PSG) process that other nonprofits must follow. In addition, those nonprofits must now turn over financial documents about their operations if they want city dollars. The legislation also adds reporting requirements for council members’ roles, as well as that of their spouses and children, in nonprofits. On Nov. 22, 2021, the legislation passed 14-1.
Early in 2022, Matt Carlucci, who is the City Council liaison with the PSG Council, introduced legislation that would set aside $7 million for the PSG Council to distribute to nonprofits, a major increase in funding over the PSG Council’s previous budget.
“City administration said it could only do $5 million, so we split the difference at $6 million, still a significant increase over the $3.5 million given to the PSG Council for distribution in 2021,” said Carlucci.
The increased PSG budget generated excitement and hope in the nonprofit community and elicited a record number of program applications — 74 programs totaling $9.1 million in requests, according to Beth Mixson, PSG Council vice chair.
“In previous years, there was great frustration and disappointment when agencies scoring in high 80s and 90s out of 100 were not funded due to funds being awarded to higher scoring agencies,” Mixson said.
While the new PSG process rule was well-intended, it did cause an unintended wrinkle this year. Nonprofits that had been receiving direct contracts without competitive evaluation now needed to apply to the PSG Council by its July 1 deadline, just like the other nonprofits. When some failed to do so, City Council members expressed concern that these organizations would receive no public funds from the 2022-23 city budget to provide their services.
In response, city administration suggested that two separate rounds — one for those previously funded through the PSG process and a second for those who had been receiving direct contracts — should be created, with $4 million for the first round and $2 million for the second.
The PSG Council expressed concern that the 74 nonprofits that had already applied would not be able to apply in the second round. They questioned why City Council asked to have more applications included without increasing the $6 million available for public service grants.
“The nonprofits who had previously received direct funding from the city requested a total of $1.8 million from the PSG Council, essentially meaning that the pot of money available to all other nonprofits barely increased at all,” said Mixson.
City Council members who wanted to give additional nonprofits an opportunity to apply argued that doing so gives the city a more competitive group of proposals possible for delivering services to those most in need in Jacksonville. Some City Council members and PSG Council members have expressed concern that favoritism to certain nonprofits may be at play.
Carlucci encouraged the PSG Council to agree that, only for this first year after the new legislation change, the application process should be opened up again for the first week of October “just in the off chance that somebody was a direct contract receiver and not used to how to apply through the PSG process.”
Agencies that missed the original deadline could submit applications in a second window during the first week of October, but agencies that had already submitted applications could not resubmit enhanced applications. The PSG Council approved the compromise 9-5.
“The [PSG] Council looked at the situation as the lesser of two evils,” said Bob Baldwin, PSG Council chair. “We thought [Carlucci’s] proposal would be better than a two-step process and two levels of funding.”
“I believe the City of Jacksonville must support and enforce a process that is fair to nonprofits who follow the rules, to taxpayers who expect their hard-earned dollars to be spent equitably and to the hardworking volunteers [on the PSG Council] who committed many hours of work in good faith to the process,” said Nina Waters, president of The Community Foundation for Northeast Florida.
“This was an issue that was always going to be resolved in City Council, so you have to appreciate both the administration’s willingness to work with the PSG Council and the PSG Council’s attempt to stick to the process. Compromises are rarely pretty,” said Rena Coughlin, CEO of the Nonprofit Center of Northeast Florida.
The new deadline was Oct. 7. The City of Jacksonville Public Affairs Office reported that the following 11 agencies submitted PSG grant proposals during the second application period: Northside Community Involvement Inc., Yoga 4 Change, READ USA Inc., The Jericho School for Children with Autism, The Villages of Hope, Edward Waters University, Cathedral District, Total Beauty Institute, Revitalize Arlington Inc., M.A.D. D.A.D.S. Jacksonville and Catholic Charities Bureau Inc.
Of these 11, three had been receiving direct contracts from the city prior to this year. During review, the PSG Council has denied Edward Waters College’s application for its New Town program. M.A.D. D.A.D.S. Jacksonville and READ USA, Inc. also applied for PSG funding for the first time this year.
“Sometimes direct contracts are a good thing, but the number of organizations getting direct contracts was getting out of hand. People should compete and the best should be awarded the dollars,” Carlucci said.
“There are cases in which direct allocations to nonprofits are necessary,” Mixson said. “Examples would be Hubbard House that helps victims of domestic abuse and Jacksonville Legal Aid. They both provide unique services limited by the state to one agency per area.”
Over the years, the PSG Council has shifted its focus from funding a broad swath of human services agencies to now focusing on acute services like homelessness, prevention services such as rent assistance and parenting classes, and diversion services served through case management.
The agencies decide in which categories their various services best fit and then submit a separate application for each service. Their services must serve adults and families, but not children. Agencies that are seeking funding for services for children only can apply to Kids Hope Alliance, which is also funded by the city.
On Nov. 15, the PSG Council voted to allocate funds to 52 programs for Jacksonville nonprofit organizations, totaling $6 million. The awardees were broken down into three categories: Priority Need A (“Acute,” which received 30% of funding), Priority Need B (“Prevention and Diversion,” with an allocated 40% of funding) and Priority Need C (“Self-Sufficiency and Stability,” with 30% of funding). For a full list of PSG recipients and their allocated funds, please visit www.coj.net/departments/finance/office-of-grants-and-compliance/public-service-grants and select “FY 23 PSG Awards.”
By Karen Rieley
Resident Community News
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