Earlier this month, Gov. Steve Sisolak announced that he was asking state agencies to reduce their 2021-2023 budgets by 12 percent. These cuts are in addition to the more than $1 billion in reductions approved this summer and are likely to compromise core services, especially in the areas of behavioral health, social services, foster care and child welfare, and education. 

Many are anticipating the federal government will approve another spending package to provide much needed assistance to states. Additionally, some have suggested that Nevada should also apply for federal grants, acknowledging that “increased federal funds receipts could relieve some pressures for State and local programs.” Unfortunately, while federal grants could provide some much-needed relief to Nevada, securing them may not be as easy as it sounds. Nevada has significant institutional challenges built up over decades.

The federal government annually distributes hundreds of billions of dollars  – roughly $750 billion in recent years – which support a broad array of services and projects that help build vibrant communities and economies. In 2019, Nevada ranked 42nd in the country in federal grants per capita ($1,786), up from 50^th in 2014.  As one report estimated, “Nevada could secure an additional $529 million dollars each year in federal funding if the state met the average funding received by neighboring western states.”

A motivated, sophisticated group of community and business leaders have been emphasizing the importance of federal grants in Nevada for at least a decade. Their efforts were preceded by Gov. Guinn’s Task Force on Tax Policy, which recommended that “Nevada’s federal funds acquisition process should be examined to determine whether an appropriate level of attention is being given to this very important function.” 

Their clarion call has started to bear tangible results. In 2015, the Legislature stood up the Nevada Advisory Council on Federal Assistance (NACFA) to advise and assist “state and local agencies with respect to obtaining and maximizing federal assistance that may be available from any agency or organization.” In 2017, the Legislature funded the development and implementation of an enterprise grant management system and allocated $200,000 annually over the biennium. The effort has been delayed (repeatedly) given the fact that “vendors just could not provide an enterprise system with full functionality for the allotted budget” and has now been “put on hold.” In 2019, the Legislature piloted a matching fund grant program (Assembly Bill 489), and infused the fund with $1 million (Senate Bill 528); this program allows applicants to meet the matching requirement included in many federal grants.   

While these recent initiatives are critical and necessary, more – much more – is needed to fully establish a grant infrastructure that will enable Nevada to secure additional federal funds needed to build strong and healthy communities and enhance our quality of life. 

First, we need to invest adequate funding to implement the much-needed enterprise grants management system that will enable users across state agencies, local governments and nonprofits to effectively communicate and coordinate, addressing one of our biggest challenges. Doing so will also enable critical data collection, analysis, and reporting on successful applications, grant dollars received, missed funding opportunities, as well as data on awards, subrecipients, and grant matching.

Second, we need to make permanent the matching grant program — and increase the appropriation. The $1 million appropriated in 2019 was expended with three applications (one application alone accounted for 85 percent of the funds). Meanwhile, another state agency, which serves some of our most vulnerable individuals, regularly returns $6-8 million in federal funds because Nevada cannot provide the match. (And as I noted previously, the Legislature did not provide an appropriation for the Aviation Trust Fund in 2019, which would allow some counties to draw down federal dollars to maintain their rural airports.)   

Third, we must prioritize and build grant procurement and administrative capacity at our key state and local agencies, including the Nevada Grant Office, and expand technical assistance. Experience suggests that many of our state agencies lack adequate grant writing capacity. And when faced with economic downturns, grant writers appear to be among the first positions cut.  This is a counterproductive choice given the urgency to pursue federal grants. 

Fourth, Nevada must streamline its federal grant acceptance and work plan approval processes to align state and federal timelines, coupled with administrative improvements to the Interim Finance Committee (IFC). Currently, state agencies must have approval from the IFC to accept a federal grant and begin performing its related work program (unless certain exemptions apply). And before being considered by IFC, state agencies must first submit their request to the Governor’s Office of Finance for review and approval. 

As a result of this two-step process and the infrequency of IFC meetings, approval may take as long as 45-115 days. Meanwhile, federal government agencies require programmatic work to begin immediately. This significant delay between announcement of a federal award and state authorization forces agencies to somehow make up time or return unspent grant funds. State agencies regularly report that these sorts of challenges result in their decision to forego applying for federal grants. 

Legislation to create a streamlined provisional approval process has been proposed in each of the last two legislative sessions, but never received the necessary support to move the proposals. To remedy this, the executive branch can immediately develop and adopt administrative process improvements, and the Legislature can then address these and other improvements in law this coming session. 

Fifth, Nevada should develop and adopt a Grant Accountability and Transparency Act, similar to that implemented by Illinois.  Elements of this act should include a commitment to: 

• Ensure federal funds supplement spending (not replace it, as is not the intent of most federal grants) by explicitly exempting federal grants from an automatic offset in the State’s Authorized Expenditures Act
• Centralize grant-monitoring and coordination activities to promote the efficient use of scarce resources
• Allocate a small share of each new federal grant (as allowable) to pay for statewide grants infrastructure so that the state’s grant work is stable and sustainable
• Increase reporting and accountability on funding opportunities (including those not pursued and awarded grants not fully expended) – all of which can be addressed by the grants management system – and
• Make subgrant application and award data transparent.

Finally, we desperately need a strategic vision to guide Nevada’s pursuit sources of revenue including federal grants. By way of example, in late 2014, the City of Detroit, after emerging from bankruptcy, launched an Office of Development and Grants and articulated a “strategic vision with funders and provide[ed] them with compelling opportunities to invest, and deliver transparency and accountability into how grant dollars enhance the quality of life” for their community. Since the office’s inception, Detroit has raised $1 billion, leveraging federal, state, and private funds. (As a point of comparison, the Mayor’s Fund for Las Vegas LIFE has raised roughly $2 million since late 2018, when it was founded). 

Strengthening Nevada’s grant infrastructure will require an investment of state resources. In the meantime, a new initiative, Nevada GrantLab, has been launched, with generous philanthropic support, to help build capacity and immediately secure new federal grants by providing grant writing services and technical assistance to nonprofits and their state and local government partners. In the six months since its founding, technical assistance efforts underwritten by the Nevada GrantLab and administered by a network of experts (including the Guinn Center) have helped state agencies and nonprofits secure more than $16.2 million in funds.  

As the Nevada economy continues to sputter, we must recognize how essential federal grants will be as a source of funding for our recovery. Admittedly, federal grants alone cannot backfill the dramatic decline in state and local revenue resulting from COVID-19. But given that federal grants fund the provision of social services, education, housing, and community development projects throughout Nevada, they are the cornerstone of an overall strategy to build strong and healthy communities. As potential federal funding for states becomes available with the anticipated next coronavirus aid package, decision makers and community leaders must further develop and implement a strategic plan for how we should leverage federal grants, additional federal aid, state revenues, foundation dollars, and private sector investment to build out a long-term vision for a strong and healthy Nevada. 

Update on Mon. 11/23/2020 at 12:52 p.m.: This piece was corrected to indicate that the Mayor’s Fund for Las Vegas LIFE has raised roughly $2 million since late 2018. The original version set the figure at less than $1 million.

Nancy Brune, Ph.D. is the founding executive director of the Guinn Center, a statewide, independent, nonpartisan policy research center. She is a senior fellow at the Boyd School of Law and serves on the Law and Leadership Program Advisory Council. Dr. Brune received her Ph.D. from Yale University and her Master of Public Policy and B.A. degrees from Harvard University. Prior to joining the Guinn Center, she was a senior policy analyst at Sandia National Laboratories, where she worked on issues of national security. You can follow her on Twitter @NancyBrune or email her at [email protected].