Jackson Free Press

The Jackson City Council grudgingly approved about $45,000 of payments to the U.S. Treasury Department Tuesday after the city failed to manage two federal law-enforcement grants. The council voted 6-0, with Ward 3 Councilman Kenneth Stokes absent, approving a $40,394 payment to the U.S. Treasury Department because the city misspent money from a 2004 local law-enforcement grant, and another $4,687 repayment of a 2002 local law-enforcement grant. The action increased the city claims docket from $2,304,563 to $2,349,645.

Jackson Assistant Chief Administrative Officer Valerie Nevels told the council during a Monday budget meeting that the city has utterly lost track of its state and federal grants. Nevels' report was a sobering follow-up to her March 31 presentation on the city's inability to manage grant money.

"[N]obody is minding the store," Nevels told the council on Monday, inciting discomfort and trepidation among council members.

Nevels explained that the city has no centralized system for keeping track of grants for which the city has applied. To make matters worse, the steady loss of personnel, coupled with administrators' inability to debrief exiting staff who are working the grants, assures that grant money lies in limbo for months at a time, or risk being overspent. According to Nevels, former employees may even vacate their office without informing superiors which grants are still active and where the files are.

Most grants secured by the city must be spent for specific projects, such as hiring more police officers or purchasing equipment. The city must prove to grant suppliers that it is both spending the money and doing so on the designated project. However, the city has been leaving oversight to an uncommitted number of people—usually the same person who applied for the grant.

Nevels gave a PowerPoint presentation to the council revealing how the city is not following existing policies and procedures, that it is not training employees charged to deal with grants, and that it is failing to keep up with grant compliance and expense tracking.

The issue has been brewing for months. Nevels told the council that external auditors had criticized the city as far back as 2002 for not having a city-wide grant management system and for its failure to "file for grant reimbursements on a timely basis." In fiscal-year 2004, auditors noted the city's penchant for over-reporting federal grant expenditures, and cited the city for "failure to follow established procedures as required by the Davis Bacon Act."

The city established the External Funds Monitoring Unit in 2005 to monitor federal and state money coming in, but was still falling short of providing adequate grant oversight under the Melton administration in 2006, Nevels said.

Former Mayor Harvey Johnson Jr., said he had established an Office of Grants Management during his first year of office, and did not recall any citation regarding the city's procedural failures regarding the Davis Bacon Act.

Ward 7 Councilwoman Margaret Barrett-Simon told the Jackson Free Press at Nevels' earlier presentation that the city needed to put grant management under one easily accessible system.

"The city has got to keep better track of this," Barrett-Simon said. "We can't afford these mishaps, certainly not now with the state of the city's finances."

Nevels suggested a number of solutions, such as putting all grant proposals before a department director, CAO such as herself, or internal audit person for approval before proposal submission, and then maintaining an official organized project file. Nevels also recommended that the city's internal audit department set up a system to alert affiliated city employees of deadline dates connected to a grant.

Nevels also suggested the city adopt an overall policy of enforcing timely spending of grant money, putting an end to equipment purchases within 90 days of the grant's expiration date and grill outgoing employees for any information they have on active grants, among other proposals.

Budget Committee Chairman Marshand Crisler acknowledged last month that the well of federal grant money is drying up as the national economy worsens and more cities compete for money.

"If we are to keep making use of these funds, we have to set a better example of our ability to manage them," Crisler said.