Human Services Commission recommends no administrative cap for 2026 grant cycle

The City of Lacey Human Services Commission voted May 7 to recommend that the city council approve Option 3 for the 2026 human services grant program, a proposal that removes an administrative-cost cap while setting maximum awards at $30,000 for service projects and $50,000 for capital projects.

Michelle Chavez, the city’s human services coordinator, presented the staff recommendation and said Option 3 would also add rubric points for how many Lacey residents an applicant serves and for alignment with the commission’s priority areas. “We’re recommending not to have a limit on that and then adding points for the number of Lacey residents served and adding points for the priority areas,” Chavez said during the meeting.

Why it matters: The decision affects how the commission distributes a roughly $300,000 program budget and how nonprofits budget staff and overhead. Commissioners debated whether unrestricted administrative percentages could divert funds from direct services, and they agreed to collect better data before setting a future cap.

Commission discussion and safeguards: Commissioner Lester Dixon said he preferred limiting administrative costs so more grant dollars reach direct services, noting concerns that high administrative percentages would reduce service funding. “I kind of like option one or two with a cap on the ad because I prefer the group provide more of the dollars to the services,” Dixon said. In response, Chavez said staff will add an unscored, required budget question asking applicants to report what percentage of their requested award would cover administrative costs, and to collect actual administrative expenditure data in post-award reporting.

Commissioner Angelina Goldwell said she supported continuing without an administrative cap for now to allow the commission to gather data. “I agree with the consensus of the group of leaving it without a cap for another year of evaluation,” Goldwell said. Commissioners said the reporting requirement will help the commission evaluate whether to adopt a cap in a future cycle.

Process and next steps: Commissioners moved and seconded a recommendation to forward Option 3 to city council; the motion carried by voice vote. Staff plans to present the recommendation to city council on May 26, open applications in June, hold applicant presentations in July and return funding recommendations to council in August for awards to begin Sept. 1, 2026. Staff said last year’s Community Development Block Grant (CDBG) allocation is about $350,000 annually and that the local human services grant program budget is typically in the low hundreds of thousands.

What was decided: The commission recommended city council approve Option 3 (no administrative cap; max awards $30,000 service/$50,000 capital; no minimum ask; rubric points for Lacey residents served and priority areas). Staff will add a required budget question asking applicants to report anticipated administrative percentages and will collect actual administrative-cost reporting from awardees to inform future policy.

The commission adjourned at 6:38 p.m.