Monday, March 7, 2022

NYC Community Trust Taking Over Administration Of Annual $150 Thousand Roosevelt Island Public Purpose Fund Grants To Local Non Profit Organizations From RIOC - Applicants And RIRA Worried New Eligibility Criteria May Exclude Some Local Groups

Since at least 2008, the Roosevelt Island Operating Corp (RIOC) delegated review of RIOC Public Purpose Fund (PPF) grant applications from Roosevelt Island non profit organizations to the Roosevelt Island Residents Association (RIRA) subject to final approval by the RIOC Board. As reported in 2015, according to the RIRA PPF Ad Hoc committee:

This Ad Hoc Committee was established as part of a RIRA Common Council community service effort to assist the Roosevelt Island Operating Corporation (RIOC) in the review of grant applications submitted by Island-based nonprofits for Public Purpose Funds (PPF). The activities of this Committee have evolved over time. The Committee makes a recommendation to RIOC and the RIOC Board of Directors is the final decision-maker regarding the distribution of funds that support qualified Island nonprofit organizations. The Committee recommends funds that would benefit Roosevelt Island residents, enhancing their quality of life through, for example, education, artistic and cultural enrichment, improved health and activity and a better environment....

                                                              Image of 2020 RIRA PPF Committee

Over the years, there have been some complaints by specific groups about the RIRA PPF committee recommendations and some modification of RIRA recommendations by the RIOC Board but for the most part RIRA has done a good job as acknowledged by RIOC.

But, the RIOC PPF process has changed starting this year. 

The Roosevelt Island Operating Corp (RIOC) Board of Directors approved delegating the administration of Public Purpose Fund (PPF) Grants to the NYC Community Trust (NYCT)  during the October 28, 2021 RIOC Board of Directors meeting (Video of discussion here)

According to this excerpt from an October 20, 2021 memo by RIOC General Counsel Gretchen Robinson to RIOC President Shelton Haynes:

Public Purpose Funds (“PPF”) grants were first awarded in 1989 when New York State established the fund to support community uses. In line with RIOC’s mission and core values, RIOC issues PPF grants to local non-profit organizations that dedicate those funds to services, programs, and projects, that benefit and enrich the Roosevelt Island community. 

The application process requires grant applicants to submit a budget along with their desired award amount. At the conclusion of the grant application process, the Board of Directors vote to approve the purpose for which the grant is sought, and the award amount to be distributed to each applicant. ... 

... RIOC is seeking Board approval to enter into a one-year contract – and two one-year options to renew – with NYCT for the purpose of providing grant administration and monitoring services for RIOC’s Public Purpose Funds Grant Program. This contract will include a pre-funding authorization for public purpose funds in the amount of $450K; along with additional funding for grantee governance and finance best practices education in the amount of $50K; for a contract service fee of $25K per each grant cycle.

Here's the full memo.

There is no current provision for RIRA participation with the NYCT administration of Roosevelt Island PPF grants process.

On February 7, 2022, NYCT informed past Roosevelt Island Public Purpose Fund recipients:

... The New York Community Trust (The Trust) is a public charity founded in 1924. As a grantmaking foundation, The Trust connects past, present, and future generous New Yorkers with vital nonprofits working to make a healthy, equitable, and thriving community for all. Since 1989, The Roosevelt Island Operating Corporation (RIOC) has provided public purpose funding to local nonprofits to benefit Roosevelt Island residents. In January 2022, RIOC asked The Trust to administer the public purpose grants and created the Roosevelt Island Public Purpose Fund. The Fund will support Roosevelt Island nonprofits that provide direct services or benefits to Roosevelt Island residents.

The Fund expects to award up to $150,000 total through one-year grants of up to $20,000 to eligible nonprofits. Proposals are due at 12pm noon Eastern on March 14, 2022. Notification of award status will be made by May 2022....

Here's the Roosevelt Island Public Purpose Fund Call For Proposals from NYCT.

On March 4, I asked NYCT: 

"I'm preparing an article on the new Roosevelt Island Public Purpose Funds (PPF) process that is being managed for the first time by the NYC Community Trust.

Several of the new eligibility criteria appear to exclude previous PPF Roosevelt Island non profit organizations grant recipients from receiving PPF funds this year or if still eligible at a greatly reduced amount from prior years.

Many Roosevelt Island non profit organizations have expressed unhappiness and confusion with the new eligibility criteria....

... Below are some of the concerns raised by the Roosevelt Island Residents Association (RIRA) excerpted from their recent letter to RIOC President Shelton Haynes:

"... We have several concerns with NYCT: the financial accounting is now worse, not better; the procurement process suffers from unfairness; the criteria is discriminatory, with a bias towards very large organizations, and eliminates smaller and prior PPF awardees; and so on. Here are specifics:

  • ●  Short notice bidders meeting: RIOC announced the PPF application process to the Island on the afternoon of February 16. Embedded in those links was a bidders meeting scheduled for less than 24 hours later. Scheduling in that time frame is difficult, especially when an RFP requires accounting and legal staff review, and choosing the right person with prepared questions to answer the call for a bidders meeting. Some organizations were not able to attend. Some organizations were not prepared for the meeting. A 24 hour turn around for such an important meeting is unfair to the non-profits involved.

    RequestedAction: The bidding process should be restarted with appropriate advanced announcement.

  • ●  Unfair bidding process: During the bidders meeting, the elements of the RFP were presented and the meeting recorded. However, once the presentation ended, the Q&A was NOT recorded. This is unfair and discriminatory as some bidders are receiving different sets of information about the bidding process, or may have benefited from the answers provided to their peers. It is normal during the procurement process for all bidders to hear all questions and all bidders to hear all answers. In addition, it has been reported to us that bidders have had direct communications with NYCT staff, yet other bidders have not been informed of those questions and answers. We believe the State procurement rules provide a fairer process, not NYCT. RequestedAction: The bidding process should be restarted with appropriate transparency and fairness.

  • ●  Maximum 30% operational costs: For some organizations, the RIOC PPF grant is 60-99% of their operating budget. These are organizations that have done good work for the Island. The NYCT criteria discriminates against these organizations, and their rationale is unclear.

RequestedAction: This criteria should be removed.

  • ●  At least 4 directors, with one a staff member. Island organizations have operated according to NYS law, which requires 3 directors. This is a burden and a hazard for Island organizations, potentially making their governance worse. It's not that the organizations need an extra member, it's that NYCT is asking (and has asked) Island organizations to change their board configurations with 4 weeks notice. How does such a board now rank and compete among other applicants? Previously it was an experienced board with 3 members, now it is an inexperienced and new board with 4 or 5 members. NYCT has not considered the consequences of their criteria and the discriminatory affect upon applicants. Furthermore, if applicants don't comply with this criteria, they must use a fiscal sponsor, which just wastes valuable money as a "pass-thru" and provides no purported benefit regarding board structure. Requested Action: This criteria should be removed.

  • ●  Project budgets. This particular accounting technique does not seem to be effective, as organizations that provide scholarships would, in effect, have negative budgets, which would cause them to be less competitive.
    RequestedAction: Simple organizational and expense accounting should be required.

  • ●  Up to $10 million organizations can participate. RIRA has steadfastly questioned why large organizations should be allowed to compete and take away from small organizations. For example, $10,000 PPF money is 0.1% of a $10 million organization. Surely every $10 million not-for-profit can squeeze 0.1% from their budget to provide a service. Meanwhile small Island organizations struggle for such funds. For decades, RIRA has provided more scrutiny on such large organization requests and have insisted that those organizations internally match (at a higher ratio) the funds they are requesting as PPF is a zero-sum game: what you give to the large organization takes away from the small organization.

    RequestedAction: For large organizations (over$1million), the criteria should be changed to a sliding scale: for every $1 million in operating budget at $1 million and above, the organization must provide an additional 1:1 match of PPF funds up to 5:1 match, e.g., $1 million organization provides 1:1 match, $3 million organization 3:1 match, $7 million organization 5:1 match.

  • ●  No capital expenditures. In fact, capital purchases provided very high value, e.g., one organization would purchase a van that was shared by other organizations. Although there are few of these kinds of projects, they are highly desirable for the long-term benefit.
    Request Action: Remove this restriction.

  • ●  Project must be different from last year. For many organizations, they provide consistent services, such as activities, summer camps, growing plants, and so on. This discriminates against those organizations providing regular services that the community needs.
    Request Action: Remove this restriction.

  • ●  Payments are one-time, lump sum, with no monitoring. Purportedly, the main purpose of RIOC handing this to NYCT was RIOC's disinterest in, or inability to do accounting and contract administration. With NYCT, once the applicant is awarded, there is a lump sum payment of the whole amount - no monitoring or partial payments like RIOC used to do.

    RequestedAction: NYCT must do project accounting and monitoring, and disburse partial payments.

  • ●  Unclear what community review is. The NYCT effort has not made it clear what "community review" is. NYCT has little/no experience on Roosevelt Island, nor with our community.

The RIRA PPF committee should do community review of applications. Requested Action: Assign RIRA PPF committee the community review.

Does NYC Community Trust have any comment on the new PPF process and eligibility criteria for the upcoming Roosevelt Islander Online article on subject."

NYCT spokesperson Marty Lipp replied March 5:

The New York Community Trust was asked by RIOC to administer its public purpose fund and to make sure the funding was awarded fairly and has maximum impact for the community. We brought to this process nearly a century of grantmaking expertise awarding nearly $5 billion across the five boroughs as well as Long Island and Westchester, working with thousands of nonprofits, large and small. 

In addition to distributing the grants in an efficient and effective manner, we want to help nonprofits submit strong applications with an eye toward strengthening their internal processes so they can flourish. But we know that our due diligence requirements may be new to some. Toward that end, we also are providing a series of workshops and coaching sessions for Roosevelt Island nonprofits on good governance and financial practices led by an expert nonprofit management provider. We hope that this workshop series and the individualized assistance we are providing will help applicants emerge stronger and better equipped to secure additional funding from new sources. 

We also hear the community’s concern about timeline. This program was launched quickly with the goal to distribute grants as soon as possible to organizations who rely on them. We understand that some nonprofits may only have three board members currently. Therefore, we are extending the date by which organizations must add a fourth member to the end of the grant period, and are happy to work with nonprofits on that effort over the course of the year. 

We have reached out and given one-on-one technical assistance to past grantees. We have created a streamlined and simplified payment process that will lighten the administrative burden on nonprofits. We are confident that the grants will support important work for Roosevelt Island in the coming year. All Roosevelt Island nonprofits are welcome to apply and we encourage them to do so. 

What follows are The Trust’s comments regarding the itemized concerns in the RIRA letter that the Islander shared with us (numbered for clarity): 

1) The Trust emailed all past grantees that the grant opportunity was open, and invited them to the informational webinar ten days prior to the meeting. 

2) We reached out to past grantees and have had one-on-one discussions to ensure their questions were answered. We continue to be available via phone and email to answer questions from all prospective applicants. 

3) Having made thousands of grants to nonprofits of all sizes over the years, The Trust staff believe that nonprofits should have diverse funding sources to maintain their viability over the long term. 

4) The Trust is not asking nonprofits to dismiss current board members. While New York State requires nonprofits to have three board members, the Better Business Bureau recommends five. In its experience, The Trust understands that it can be challenging for smaller nonprofits to recruit five, and therefore its requirement is four board members. We are happy to work with nonprofits to achieve this board expansion within the yearlong grant period, if that nonprofit’s application is awarded. We believe the free nonprofit workshops provided through this fund will additionally strengthen governance practices for all organizations. 

5) As part of the application materials, and in line with our standard practice, we request a project-specific budget from applicants that includes income and itemized expenses. We also request an overall budget for the organization. A scholarship, for example, would be itemized as an expense. Any nonprofit can address specific queries with our staff. 

6) The Trust is prioritizing grantmaking to nonprofits with budgets below $10 million, which includes smaller nonprofits. 

7) Because the grants are generally small, they cannot be used for brick and mortar capital projects. However, equipment purchases, such as a van, are an allowable project expense if they ensure a group can deliver its service. If a nonprofit has any questions about specific expenses, we are glad to speak with them. 

8) This program will make project grants to both existing and new programs. Nonprofits can submit applications for existing programs that they have run in prior years. We additionally expect and encourage nonprofits to include administrative or overhead expenses in their project budgets. 

9) The Trust believes that nonprofits, particularly smaller ones, can best fulfill their missions when their administrative burden is reduced. Best practice for grants of this size is to disburse grants upfront in one payment, which helps nonprofits with planning and cashflow. Grantees’ work will be monitored through a single, final report at the end of the term of the grant. Trust staff conduct additional financial due diligence reviews on the front end before making a grant, rather than on the back end as may have been the past practice. 

10) The Trust has nearly a hundred years of experience working with New York City community-based organizations. We have enlisted a review committee composed of five Roosevelt Island community members who will review every proposal and recommend grants to The Trust. 

We encourage any nonprofits with questions to reach out to us, and to review the Request for Proposals, to which we have recently added a Frequently Asked Questions section. 

Here is the full RIRA letter sent to RIOC President Shelton Haynes

and discussion of the Public Purpose Fund grants during March 2 RIRA Common Council meeting Public Session.

RIOC has not responded to request for comment.  

UPDATE 3/10 - I asked NYCT:

... who are the 5 Roosevelt Island residents selected for the Community Review process and what criteria was used to select them?
NYCT Trust spokesperson Marty Lipp answered:
The New York Community Trust searched for and selected committee members to the Roosevelt Island Public Purpose Fund based on the following criteria: they live or work on Roosevelt Island; have deep experience and expertise in the nonprofit and/or public service sector; have no known conflicts of interest with past PPF grantees; and reflect age, gender, and racial diversity. Aligned with best practices to maintain a fair and objective review process, we will announce the committee members in May when we announce the grant recipients.

I followed up:

In the interests of openness and transparency why are you not announcing the members of the review committee now. The members of the Committee may have conflicts that NYC Community Trust is not aware. 

By making the names public now, any potential conflict can be vetted by the community and addressed now. Are any Committee members married or otherwise part of Rioc board or staff families? .... How many of the 5 work but do not live on Roosevelt Island.  

Mr Lipp replied:

My earlier response sums up what we have to say at this point about the evaluation committee members and the process for choosing them. 

We understand that this is a new process for the Island. If prospective applicants have any questions, they can contact The Trust directly as outlined in the RFP (as many already have) for guidance and assistance.