Last month, FFIS hosted a workshop on building blocks for better federal funds management. Laurie Petrone—director of Rhode Island’s Grants Management Office—shared her state’s approach to managing federal funds. Rhode Island maintains a federal award catalog that tracks every federal dollar the state receives. This Special Analysis provides insights into Rhode Island’s Grants Management Office and its federal award catalog.
The federal government is providing state and local governments with nearly $729 billion in federal funds in fiscal year (FY) 2016. However, most of these funds come with strings attached. Many federal grant programs require states to contribute their own funds to the cost of a program, through matching or maintenance-of-effort (MOE) requirements. This Special Analysis provides a summary of programs with state matching or MOE requirements, based on the FFIS grants database.
The Census Bureau released state population estimates for July 1, 2015, at the end of December 2015. Using those estimates and FFIS grants database figures, states were ranked on their fiscal year (FY) 2015 per capita receipt of federal funds in a host of areas. Among the major findings are the following:
- Due to its unique relationship with the federal government, the District of Columbia ranked #1 in federal grants per capita. It was followed by Alaska, Wyoming, and New Mexico.
- Virginia received the lowest federal grants per capita, about one-third the amount received by the highest-ranking state. Other states ranking low included Utah, Florida, Kansas, and New Hampshire.
- Medicaid drives most results. Outside of Medicaid, federal grants declined between FY 2010 and FY 2015.
- The Affordable Care Act (ACA) has increased Medicaid’s role, as states that expand Medicaid see an influx of new federal funds.
- Puerto Rico ranks near the top of many grants allocated by income and poverty, but ranks last in Medicaid because of a federal cap.
The following areas also play an important role in state results:
- Income security and social services, education, and transportation are the only other categories where federal grants average more than $100 per capita.
- General government is a small category, but one program drives results for a few states: mineral leasing payments. While the average state received less than $10 per capita, Wyoming received more than $1,500, and New Mexico received $260.
This analysis is accompanied by detailed spreadsheets available to full database subscribers.
In testimony offered to the Senate Budget Committee, the Government Accountability Office (GAO) identified a host of areas where federal financial management falls short. While most of them are specific to the federal government, some involve, have implications for, or will be of interest to state fiscal managers.
FFIS demystifies the flow of federal funds to their many recipients using charts, graphs, and words. Grants 101 begins with the big picture and slowly works its way down to a more nuanced description of federal grants and how they work. It even explains why different amounts are attached to grant totals on different pages of the report.
This Special Analysis presents FY 2016 funding estimates for 52 grant programs based on appropriations actions taken by the House and Senate. It focuses on discretionary grant programs that are of most importance to states, which totaled $122 billion in FY 2015. The estimates alert states to potential risks for funding cuts or eliminations, as well as additional resources. They also may serve as a starting point for future budget negotiations. Both the House and Senate propose to reduce funding for the included programs by -$1.6 billion (-1.3%) and -$2 billion (-1.6%), respectively. This analysis excludes funding for mandatory programs, such as Medicaid, the Social Services Block Grant (SSBG), and Temporary Assistance for Needy Families (TANF). Funding levels for those programs are determined by authorizing legislation, rather than the appropriations process.
Per capita federal spending is one measure for states to assess how they fare in their fiscal relationship with the federal government. This analysis provides the most recent per capita figures, focusing on the 244 federal grant-in-aid programs tracked and included in FFIS’s Grants Database. These grants account for more than 90% of total federal grants to state and local governments. The database primarily includes formula grants and does not capture many of the small competitive grants for which states compete.
This analysis provides per capita data for federal fiscal year (FY) 2014, using the Census Bureau’s annual population estimates from July 2014. On average, the federal government spent $1,969 per person on grants to state and local governments, ranging from $4,994 in the District of Columbia to $1,265 in New Hampshire.
The federal government spends more than $500 billion on grants. While the lion’s share of funding is in formula grants to states, there are hundreds of project grants that are awarded primarily on a competitive basis to a variety of entities, including state and local governments, institutions of higher education (IHE), school districts, nonprofits, and businesses.
This Special Analysis is designed to help states identify the universe of federal grants. It provides a comprehensive listing of all federal grants awarded in fiscal year (FY) 2013 using data from USAspending.gov. It includes the following information, sorted by federal agency: grant name, Catalog of Federal Domestic Assistance (CFDA) number, type of grant, and types of entities receiving funding. Because of data shortcomings, it does not provide grant amounts but does indicate whether any entity in a state received funding for a particular grant.
Over the years—most often during periods of federal budget retrenchment—analysts have considered whether the federal government and states should “swap” responsibilities. That is, whether the federal government should reduce or eliminate its grants in one program area, and redirect those resources into another. Such sorting out holds the promise of allowing the entity with full funding responsibility over an area to improve its efficiency and effectiveness. For states, it could provide flexibility that federal oversight typically precludes, and reduce or eliminate costly and often-burdensome requirements that accompany most federal assistance.
During the Reagan administration, it was suggested that states assume full funding responsibility for the major welfare program (Aid to Families with Dependent Children) while the federal government would take full responsibility for Medicaid. In retrospect, this would have been an excellent deal for states, but it never gained traction.
We are now in another period of federal budget retrenchment. Due to efforts to reduce the federal budget deficit, most federal grant programs outside those designated as “mandatory” have seen level funding at best, and sometimes significant reductions, especially in inflation-adjusted terms. The prospect of swapping greater federal responsibility in one program area for greater state responsibility in another is gaining renewed interest.
To understand the potential impact of federal-state responsibility swaps, it is necessary to consider the importance of federal funding in each of the major categories of public spending. This Special Analysis examines the major areas of state-federal fiscal relations, and provides background information on states’ reliance on federal funds in a host of program areas.
A state that chooses to create a grants office typically does so with the primary goals of managing and maximizing federal grant funds. While these are important objectives, the benefits of a grants office extend beyond these dollar-driven missions.
grants office can ensure that the state’s policy goals are understood by
state agency personnel who are best-positioned to pursue grant funds to
help meet those goals.
state agency staff, there will be a place to turn when federal and state
auditors ask compliance questions related to federal grants. Compliance
rules are complicated, and in 2014 all administrative circulars are being
replaced by new guidance. Even experts will have to update their grants
grants office can give local governments and nonprofits a single place to
go to identify grant opportunities from all funding sources, and to
receive technical assistance.
governments, nonprofits, and others can work with a grants expert in each
state agency who can provide subject-specific advice. They can also
identify people in their own communities already working in the grants
field who are potential partners or resources for technical assistance.
grants office can provide free training for anyone, not just staff in
state agencies, on how to find, win, and manage grants. By providing this
training, peer interaction will increase across agency and jurisdictional
lines, further improving the odds of program success.
and legislative staff can benefit by having a place to direct constituents
seeking advice on where to look for funding.
- A grants
office creates a pool of experts across state agencies to tap when a new
priority requires significant grant writing (e.g., Affordable Care Act
[ACA]) or grants management services (e.g., American Recovery and
Reinvestment Act [ARRA]).
- A grants office can be part of a system for reviewing requests for letters of support on grant applications.
Under the Budget Control Act of 2011 (BCA, P.L. 112-25) and subsequent legislation, mandatory programs covered by sequestration are subject to across-the-board (ATB) cuts in FYs 2013-2023. While a majority of mandatory funding awarded to states is exempt from sequestration, there are a number of mandatory programs that are subject to the ATB cuts. Specifically, 24 grants tracked by FFIS in its Grants Database fall into this category. This Special Analysis provides background on mandatory sequestration and highlights the different approaches taken by federal agencies to implement it.
Per capita federal spending is one measure for states to assess how they fare in their fiscal relationship with the federal government. This analysis provides the most recent per capita figures, focusing on the 242 federal grant-in-aid programs tracked and included in FFIS’s Grants Database. These grants account for 90% of total federal grants to state and local governments. The database primarily includes formula grants and does not capture many of the small competitive grants for which states compete.
This analysis provides per capita data for federal fiscal year (FY) 2013, using the Census Bureau’s annual population estimates from July 2013. On average, the federal government spent $1,871 per person on grants to state and local governments, ranging from $4,815 in the District of Columbia to $1,187 in Nevada.
Many states are seeking ways to assess how they fare in their fiscal relationship with the federal government and strengthen their efforts to maximize federal dollars. A handful of states have set up centralized grant offices to measure their progress and identify new funding opportunities. Others are evaluating whether to do so or have decided to track and monitor federal funds through existing structures.
There are a number of ways to evaluate federal spending. To give states a sense of their standing, the table below shows per capita federal spending for grants tracked by FFIS. While FFIS does not track every grant dollar going to state and local governments, it captures more than 90% of the total. This Special Analysis examines existing data sources and identifies steps to maximizing federal grants.