Grant funding is a significant and recurring source of revenue for the City. The City receives grant funds from federal and state agencies along with foundations, and other private entities. Click here for grant fund expenditure detail.
Sources of Grant Funding
Grants are received throughout the year with varying expenditure deadlines depending on the goals and fiscal calendar of the grantor. For example, grants from the federal government often follow an October to September fiscal year and are intended to be used to support programs for a specific period of time. State grant funds typically follow a July to June fiscal year.
The City allocates grant funds in adherence with grantor timetables and specifications. Therefore, although grant dollars are awarded in a specific year, grants that are intended for use over a longer period of time, such as infrastructure grants, typically may not fully be expended in the year the grant was awarded. The City budgets the entire grant award in the year it is anticipated to be awarded, and the amounts remaining at the end of that year are carried over into the next year’s budget; this funding is called carryover funding. Typically, infrastructure funding, certain public safety grants, and public health grants are multi-year appropriations from the federal and state governments; while many community development and community service grants are annual appropriations.
The below table reflects the total grant revenue in a given year, including any carryover funds from the prior year.
While the level of grant funding varies from year-to-year with the availability of grants that meet the City’s needs as well as the City’s ability to obtain those grants, the overall level of grant funding has decreased in recent years. This is primarily a result of the phase out of federal stimulus funding in 2013. From 2009 to 2013, the City received over $1.35 billion in stimulus funding from the Federal American Recovery and Reinvestment Act, which provided one-time grants to be used for a variety of job assistance programs and other community needs.
The City’s 2017 grant revenue estimate includes approximately $337 million in carryover funding, primarily in aviation and public safety grants. The total new estimated grant funding in 2017 is $1.29 billion, which includes some large grants that will be spent over multiple years. As discussed above, the City’s annual grant revenue varies by the amount of carryover funding from the previous year. Any grant funds received in 2017, but not subsequently spent in 2017, will be considered carryover funding in 2018. The current 2017 revenue estimate will be adjusted in 2018 to reflect actual revenue received and spent in 2017, while the 2018 grant revenue estimate will reflect carryover funds from 2017 as well as new grant award estimates in 2018.
Grant Funding Going Forward
The City continues to closely monitor the federal and state budgets for possible impacts to grant funding in the future.
State of Illinois Grants
On July 5, 2017, the State of Illinois passed their first full budget since 2015 for the State’s fiscal year 2018. The budget maintains grant funding for most areas, but there are 5.0 to 10.0 percent reductions in some grant funds. The City does not anticipate these minor reductions to impact city programs or services funded by these state grants. The State budget appropriates $4.17 billion for various capital projects across the State. This appropriation does not result in new funding to the City; instead it appropriates funding to capital projects previously approved and expected to be funded, at least in part, with state funding.
Federal Government Grants
A full federal budget was presented by the Trump Administration in May 2017. In its initial form, the Federal Budget for fiscal year 2018 included significant cuts to many social service programs and community development grants, such as eliminating the Community Development Block Grant (CDBG) program. As Congress reviews and changes the fiscal year 2018 budget, the City will continue to evaluate the impact on current city programs. The City is also monitoring the Administration’s proposal to increase funding for infrastructure programs, and if this funding becomes available, the City will look for opportunities to capitalize on additional infrastructure funding.