Finance proposes grant-monitoring agreement to increase transparency on city-funded grants

Finance staff presented a proposed grant-monitoring agreement the city would apply to recipients of city-funded grants and contributions. The proposed covenants would require recipients to use funds only for approved program purposes (not personal expenses), maintain good standing with the state and Franchise Tax Board, carry insurance as appropriate for the program, provide a performance report summarizing attendance and program outcomes, submit itemized financial reports (invoices/receipts), and retain grant-related records for three years.

Finance staff said reimbursement requests must align with the period of performance stated in the grant application and that recipients should return unspent funds to the city. Staff also noted the city would verify recipient standing on state and Franchise Tax Board websites and that failure to comply could affect future eligibility.

Council members and some public commenters asked whether the city would provide templates and rubrics for performance and financial reports; finance staff said templates could be provided while allowing recipients flexibility to use existing reporting formats when those meet the city's requirements. Commenters also urged that city staff provide more active guidance to grant-review committees earlier in the process to reduce downstream inconsistencies in scoring and eligibility decisions.

Staff said the policy applies to grants and city-funded programs and is intended to improve transparency and accountability with limited exceptions for allowable operating costs when specifically justified in an application. The council did not take final action; staff will finalize template materials and provide follow-up guidance to grant-review bodies.