by Alex Saric
The U.S. Office of Management and Budget (OMB) estimates federal grants to states and local governments in FY2019 totaled nearly three quarters of a trillion dollars. To put that in perspective, the US GDP that year was just over $21 trillion and federal spend was $4.4 trillion, making grants roughly 17% of the total federal budget.
Federal grants often make up a large portion of any state, county or municipal budget. In some cases grants contribute as much as half of annual expenditures. The mission critical nature of grants becomes clear, for instance, when one considers state agendas are driven by focus priorities (such as response to the Covid pandemic).
In order to address broad, influential priorities like emergency management or public safety, administrations must find ways to deliver necessary funding. Typically they’re presented with three options; increase taxes, increase fees, or pursue federal resources.
Obviously, increasing access to and utilization of federal funds is preferable to increasing constituency tax burden. The best way forward, therefore, would be the aggressive pursuit of federal programs and federal resources. The management of these programs is ultimately what defines the success of the intended economic impact.
Solicitation, award and distribution of grant funding requires significant effort from government administrators and experts in the areas of grants compliance. Alternatively, applicants must dedicate many hours (often hundreds) into writing and submitting grant applications with often unpredictable results. When a grant is awarded, many recipients have difficulty managing and tracking funds.
They may lack resources required to meet programmatic and financial reporting requirements or mitigate the many risks of non-compliance. With limited staff and budget restrictions, recipients quickly find there aren’t enough resources to manage the full lifecycle of the grant. Inefficient, often disparate systems, as well as duplicative processes add to that complexity. The management process is often inefficient, and worse, subject to waste, fraud and abuse.
To reduce inefficiencies and fraud, grant activities are governed by several regulations including these two relatively recently enacted laws:
In response to the changing landscape of legislation and accountability requirements, there’s been a movement towards normalizing and standardizing these processes. Replacing inefficient legacy systems and manual processes with technology capable of automating the entirety of the grants process has become the goal. Automation can deliver improved forecasting, monitoring and collaboration in addition to a more predictable and sustainable means of managing federal resources.
Earlier this month, the American Rescue Plan Act of 2021 was signed into law. The $1.9 trillion stimulus package provides the country’s public health workforce needed support totaling nearly $93 billion. Some of this funding will be distributed by HHS to state and local health departments tasked with providing regional Covid-19 management. Other notable provisions include:
The stimulus funding and projects it will benefit will require responsible management, stewardship and oversight for years to come.
Grant solicitations are much like procurement solicitations in that, to be successfully managed, require contracts, budget tracking, purchase orders, invoicing, and audit preparedness.
Ivalua’s grant solution enables grantors, applicants, and awardees to perform these activities effectively and efficiently. Developed natively on Ivalua’s industry leading procurement platform, the grants package provides grant managers:
With the passage of the American Rescue Plan Act of 2021 and its impact on the volume of funding being managed at all levels of government, the need for improved processes and technology has never been greater.
Sean has worked directly with hundreds of clients in both the public and private sectors to deliver value in strategic supply management. As the leader of the Public Sector practice at Ivalua, he ensures clients are getting full value from the Ivalua Source-to-Pay Solution at the local, state, and federal levels. Sean advises C-Level executives on a regular basis and has been featured in a variety of books (Essentials of Supply Chain Management), newspapers (USA Today), and internet media sites (Yahoo! News).
Prior to joining Ivalua, Sean held sales and operational leadership roles in several supply chain technology organizations. Sean also worked as an executive in a “Big 6” consulting firm and served for 8+ years as a Flight Officer in the US Navy. Sean has a Bachelor of Science Degree from Vanderbilt University and a Masters in Business Administration from San Diego State University.
Tom has more than 20 years’ experience in sales and a strong background in consultation and delivery of spend management solutions. He’s led successful large-scale public sector digital modernization projects and partners with state and local governments in support of their procurement transformation initiatives. His experience spans various key areas of procurement, supply chain, grants management and government funding. Tom has a Bachelor of Arts Degree in Philosophy from St. John’s University and has completed graduate level coursework in the area of Public Policy.
Alex has spent over 15 years of his career evangelizing Spend Management, shaping its evolution and working closely with hundreds of customers to support their Digital Transformation journeys. As CMO at Ivalua, Alex leads overall marketing strategy and thought leadership programs. Alex also spent 12 years at Ariba, first building and running the spend analytics business as General Manager. He then built and led Ariba’s international marketing team until successful acquisition by SAP, transitioning to lead business network marketing globally. Earlier, Alex was a founding member of Zeborg (acquired by Emptoris)where he developed vertical Procurement applications. He began his career in the U.S. Cavalry, leading tank and scout platoons through 2 combat deployments. Alex holds a B.S. in Economics from the U.S. Military Academy at West Point and an international M.B.A. from INSEAD.
You can connect with Alex on Linkedin