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Federal Grants Hard to Manage in Distressed Cities?

(AP Photo/Carlos Osorio)

The awarding of federal grants is a difficult solution for financially distressed cities like Flint, Michigan.

According to a recent report from the General Accounting Office, the very characteristics qualifying a city such as Flint as being in “serious financial crisis” — such as Chapter 9 bankruptcy and employment decline — likewise hinder its ability to maintain the federal grants designed to help.

“Cities facing serious financial crisis or in Chapter 9 bankruptcy provide a special challenge to the federal government and its grant-making agencies,” the report notes. “On one hand, the losses of human capital, financial, and organizational capacity that can accompany such serious financial distress present municipalities with significant challenges to their ability to effectively obtain and manage federal grants.”

The General Accounting Office was asked to generate the 42-page March report by Congressman John Conyers and Senator Gary Peters with the objectives of identifying municipalities such as Flint, reviewing the federal monitoring process of these places, and using the White House Working Group’s efforts regarding Detroit as a model for assessing other distressed municipalities.

Of the four cities studied in the report — Detroit, Flint, Camden and Stockton — Flint saw the most drastic workforce reduction between 2009 and 2013 at a 44 percent reduction, impacting the amount of city staff that could help manage and oversee federal grants.

“Flint officials … told us that losing staff with critical grant management knowledge contributed to compliance problems,” the report notes. “According to staff from HUD’s Office of the Inspector General, staff turnover in Flint contributed to grant management knowledge gaps and subsequent audit findings.”

The solution to what the report calls “gaps in institutional knowledge” would be to put a “mechanism in place for staff to pass down knowledge to their successors,” though Flint Mayor Dayne Walling thinks the report missed the full picture of the situation there.

“I think the report missed how much the city of Flint has been able to acquire grants because of the master plan and new partnerships that have been put in place,” Walling told MLive.

Marielle Mondon is an editor and freelance journalist in Philadelphia. Her work has appeared in Philadelphia City Paper, Wild Magazine, and PolicyMic. She previously reported on communities in Northern Manhattan while earning an M.S. in journalism from Columbia University.

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Tags: detroitbankruptcycamdenflint