The federal government sent $1.26 trillion to state and local governments in FY2022, primarily through grants. States distributed $662 billion to local governments, while nonprofits received $294 billion in government grants that year.

Grantmaking is essential to turning public policy into local action. Today, state agencies use grants to equip organizations to do everything from improving rural health and preventing homelessness to expanding broadband access and spurring economic development.

Most agencies already have a system for the transactional side of moving funds. There’s software for tracking the applications, awards, drawdowns, and procurement. The financial machinery of a grant is mature. But it wasn’t built to answer the question that matters most: Is the money working?

Beyond transactions and compliance, that’s a question about grantee needs and performance.

The answers to whether grants are working are scattered across spreadsheets, inaccessible shared drives, and a handful of annual reports.

But grantees are people, often working at community organizations, faith-based organizations, and other nonprofits, ranging from three employees to thousands. Today’s grant management systems don’t connect with those doing the work.

Does the executive director who inherits a grant midstream have what she needs? Can a frontline public servant get an answer in two days? When federal guidance shifts, is there any mechanism to broadcast the change to everyone who needs to know? Does the grantee have the organizational capacity to do this again, or is it being held together by one person who could leave?

Source link