FEDERAL SECTOR REPORT

Back to the Future

The Bush Administration has opened wider the doors to federal funding for community organizations including faith-based initiatives. Welfare, education, criminal justice, and substance abuse services are among the types of services provided by such initiatives.

Through an Executive Order dated January 29th, President Bush has directed four Departments to set up Centers for Faith-Based and Community Initiatives: Education, Labor, Health and Human Services, and Housing and Urban Development. The Centers must be operational within 45 days. The purpose of the Centers will be to coordinate department efforts to eliminate regulatory, contracting, and other programmatic obstacles to the participation of faith-based and other community organizations in the provision of social services. The Centers, along with representatives from other executive departments and agencies, will collaborate with the White House Office of Faith-Based and Community Initiatives. The full text of the executive order is available at  http://www.whitehouse.gov/news/releases/20010129-3.html.

Déjà vu?

Federal social programs of the 1960s relied extensively upon community nonprofit agencies including those sponsored by faith-based organizations. This was true of the Community Action Program (Economic Opportunity Act) and vocational training programs (Manpower Development and Training Act). Jewish Vocational Services and Rev. Sullivan's Opportunities Industrialization Centers (OIC) are just two examples. In 1968, I evaluated the "Meals on Wheels" pilot demonstration program for the National Council on the Aging, which relied extensively on faith-based organizations to provide volunteers who delivered meals to the elderly.

Rethinking Opportunities

Our newsletter readers, who are generally federal contractors and grantees, will need to "think hard" before they find money in the faith-based initiatives. In fact, that is one of the underlying points of the initiative. Instead of huge streams of dollars flowing to the social welfare establishment, more modest budgets will be awarded to low-overhead organizations that rely heavily and volunteers and paid lay personnel, rather than social workers and other credentialed professionals.

Those who favor the faith-based approach contend that the high-cost social welfare establishment has failed to solve social problems. The money gets chewed up within the social welfare bureaucracy and precious little flows to people who need help. Moreover, commitment to values (faith) is often a key component to breaking out of poverty, drug abuse, criminal behavior, etc. Not everyone agrees with these tenants, but these are the types of assumptions that underlie the Administration's focus.

Forget about huge contracts or grants to help people in need. You will have to rethink the opportunities.

Finding Possibilities

If you have put on your "rethink hat" as suggested, you are ready to consider our list of possibilities.

Contractors. We have no guarantees, but it may be possible to develop contracts with federal departments for:

Grantees. While many tiny community initiatives may prefer being subgrantees to state governments or other funding "middlemen," there are a number of possibilities for moderate-sized funding.

National organizations and state associations may find roles to play as "prime grantees." This is much like the situation that I described for the National Council on the Aging, which had a national demonstration grant and distributed most of the money to community organizations providing services in places like Huntington, Columbus, and New York City.

Colleges and universities may be able to serve as mentors  for promising local initiatives that merit research, documentation, and replication in other communities. Some faith-based initiatives seem to work well, and the models may be of interest to other communities. Some federal agencies may be interested in supporting this type of model development, refinement, and dissemination.

National and state organizations, as well as universities, will need a good mechanism for working with community-based voluntary organizations (whether faith-based or other). Ideally, the support for the voluntary organizations will include grant administration (as the prime grantee), technical assistance, and telephone and/or e-mail support. The prime grantee should provide value-added services that enhance the quality, results, and cost efficiency of the work carried out by the community groups.

Commercial Products. Faith-based organizations will need support when wrestling with government forms and procedures. Among the possibilities for commercial sales to faith-based organizations might be:

• Accounting packages specifically geared to tracking federal grant funds
• Management reporting systems tailored to specific federal departments (primarily Education, Health and Human Services, Housing and Urban Development, and Labor)
• Automated grantwriting software
• Seminars

Quality and Results. During the 1960s,  many community-based organizations carried out  federally-funded programs, and some were incredibly effective while others were scandalously terrible. We hope that, in this new incarnation, the public and private sector will find ways to help community organizations to provide greater consistency in quality and results. We certainly will solve our social problems only if the much-needed voluntary help is effective.

Heterogeneous Market.  While the Executive Order signed by President Bush addresses policy and programs at the federal level, many of the U.S. funds filter through state agencies and, sometimes, local government. Don't expect to see a huge influx of federal funding directly to small community grantees. Much of the money will flow through the traditional intergovernmental channels. Hopefully, the Administration is talking with the National Governors' Association, the National League of Cities, the National Association of Counties, and the U.S. Conference of Mayors.

Personal Items

Elena and I had a great trip to Rome. I have started working on a project at the Treasury Department and continue to stay busy on another project at Department of Labor. In my spare time, I'm developing a new web site for the P2C2 Group that takes a broader approach to the Federal Sector.

CONSULTING SERVICES

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