Funding Review Advisory Committee hears city and nonprofit leaders on human-services funding crunch

Columbus — City staff and nonprofit leaders told the Funding Review Advisory Committee on Oct. 25 that demand for human-services has risen sharply while federal pandemic funding and some grant streams are ending, leaving local leaders to consider new revenue and program approaches.

Hannah Jones, deputy director of community development for the city Department of Development, described changes the city has made to its grant programs — including moving from a $5,000,000 annual bed-tax allocation to $10,000,000 and shifting to three-year, flexible operating grants — and said the city is emphasizing trust-based investments and programs like Accelerate and Elevate to provide more flexible operational support.

The comments mattered because the nonprofit sector provides a large share of social services in Columbus and Franklin County and is warning of an immediate shortfall if federal support shrinks. Michael Kory, executive director of the Human Service Chamber of Franklin County, told the committee his organization represents more than 220 nonprofits and that demand for services has jumped 72% since January. He said many member organizations reported they cannot meet current demand and that multiple federal policy changes could further reduce funding.

Jones said the city’s competitive grant process began in 2015 and has evolved: earlier rounds were program-specific and sometimes legacy-based, while recent rounds prioritize multi-year operational support. “We moved away from programmatic funding and towards flexible capacity-building services,” Jones said, adding the three-year cycle gives nonprofit partners more time to plan. She also highlighted the city’s focus on households the city calls ALICE — asset-limited, income-constrained, employed — noting that the number of such households in Franklin County has grown 41% since 2010 and that, as presented at the meeting, a family of four in childcare needs roughly $90,000 a year to break even and about $147,000 to move toward stability.

Kory described the region’s nonprofit sector as a substantial economic engine and safety net: membership organizations collectively generate more than $2 billion in annual revenue and employ more than 22,000 people, he said. But he warned of a “supply and demand” crisis. “Today, before a lot of the federal things have hit, a vast majority of our members can’t meet the current demand,” Kory said. He listed immediate pressures including the winding down of ARPA and CARES-era funds; a reported executive order and federal review of grantmaking tied to diversity, equity and inclusion; and proposed federal budget cuts to Medicaid and SNAP that he said could reduce funding available to clients and to service providers.

Kory recounted that local governments moved ARPA and CARES funds quickly during the pandemic — he cited $20 million allocated locally in 2020, $15 million from the city and $5 million from the county — but said those emergency sources are ending. He also summarized survey findings the chamber shared with the committee: demand up 72% since January; 54% of respondents said they expected a budget deficit at the time of the survey; and 37% reported difficulty hiring and retaining staff (an improvement from prior years). He cautioned that Medicaid reimbursement increases (noted at 7.6% in the chamber’s slide) were “ominous” given potential federal cuts.

Committee members asked for concrete options for new local revenue. Kory and Jones discussed possibilities without endorsing a single approach: longer grant cycles, reallocating or reprioritizing local funds, exploring marijuana-related revenue, targeted levies or other local levies, and partnering with philanthropy and business. Kory said some communities are convening public, private and philanthropic partners to pursue solutions and that outside experts (including public-finance advisers) could help the committee evaluate options. “There are lots of arrows in our quiver,” Kory said. “Some are small and fast; some are large and will take time.”

Members also pressed on sector capacity: workforce turnover and wage pressures, the potential role of mergers, and whether social-enterprise models could provide revenue. Kory said mergers and earned-income strategies are among the tools nonprofits are considering but warned they are not a full solution to large funding gaps; several organizations are exploring retail, fee-for-service and other enterprise activities but those typically take time to scale. Jones and Kory both emphasized prevention and upstream investments — for example, housing and workforce supports — as a way to reduce emergency demand over time.

No formal committee votes were recorded during the presentation. Committee chair Sandy (identified in the meeting transcript as the convenor) thanked the presenters and said staff and committee members would continue the discussion in follow-up meetings. The packet referenced a Cohere consulting report that provided phased funding estimates; Kory said the chamber would provide clarifications from Cohere about the scope and assumptions behind its dollar estimates.

The Funding Review Advisory Committee did not adopt new policies at the session; presenters and committee members signaled further work with city staff, county partners, philanthropy and public-finance advisers to identify and vet specific local revenue and programmatic options.