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Critical audit leads to changes in City Council grant process

Mayor Charlie Hales announced a new competitive process for grants awarded and overseen by City Council office on Monday.

The announcement follows a critical audit of the council grants that said the one-time special appropriation grants lacked transparency and equity safeguards.

“Portland is fortunate to have a lot of great organizations doing a lot of great things, and the City has a role in supporting those efforts,” says Hales. “However, the key to funding shouldn’t be connections; it should be creative ideas and exceptional efforts. This new process will level the playing field by inviting all ideas to be considered — not just those with Council connections.”

The Jauary 2016 audit found grants totaling $9 million to $17 million a year for the past five fiscal years that went to outside organizations for activities ranging from arts performances to social service programs. Many of these grants are for activities that don't fit comfortably into the city's bureau structure, and are administered out of the offices of the mayor and commissioners, where the staff is not trained to oversee them, according to the audit.

"The City Council does not conduct any upfront planning to define the program objectives for grants they fund, but instead provides grants directly to specific organizations and activities. There is no competition to ensure that public money is provided to organizations best able to provide the services. "Transparency of these grant awards is also limited, and it is difficult for the public to track who receives grants," says the audit, titled, "City Council Grants: No competition and limited oversight."

A previous Portland Tribune story on the audit can be read at portlandtribune.com/pt/9-news/289694-167046-audit-city-council-awards-millions-in-grants-with-no-competition-and-little-oversight.

Hales' announcement came the day before public hearings begin on the next city budget.

Special appropriation grants outside of city bureaus have historically been awarded during the annual budget process, when individual council members ask for a cause, capital cost or organization to be funded. A January 2016 audit by the City Auditor's Office highlighted the lack of competition among grant awards.

Under Hales' proposal, rather than lobbying council offices, groups will apply for funding through a competitive process.

The Office of Management and Finance will manage the new process, which requires:

• A certain amount of money will be budgeted for one-time special appropriations grants in the 2016-17 budget.

• Interested groups can apply for a portion of that money by a summer deadline.

• A committee will assess the applications — with an emphasis on equity — and recommend awards.

• By fall, City Council will approve the grant awards as a whole.

• The City will provide technical assistance for organizations drafting proposals in order to make the process as accessible as possible.

The new special appropriations grant process will be incorporated into Hales’ proposed budget, which will be released in a month or so. The council must approve it as part of the budget process.

Hearings on next year's budget are scheduled as follows:

• Tuesday, April 5, from 6:30 to 8:30 p.m., at Wilson High School, 1151 SW Vermont St.

• Tuesday, April 12 6:30 to 8:30 p.m., Alice Ott Middle School Auditorium, 12500 SE Ramona St.

In addition, a hearing on the city and Portland Development Commission budgets will be held on Thursday, May 12, from 6:30 to 8:30 p.m. at

City Hall, 1221 SW Fourth Ave.