Federal rule-making is one of those inside-the-Beltway issues that rarely make headlines, but it often changes things significantly for anyone affected by it. For grantees of AmeriCorps, new rules may force an emphasis on fund raising and efficiency that, some fear, will shut some of them out of future funding.
Corporation for National and Community Service CEO David Eisner, appointed by President Bush in 2003, has heard the concerns. After enjoying a record AmeriCorps appropriation from Congress this year ($441 million), Eisner is walking a razor wire between the worries of his grantees and the wishes of a conservative-led Congress that is wary of the agency’s past financial blunders and of a stable of grantees that were first funded during the Clinton administration.
CNCS submitted its new rules for public comment in August, and the field responded by questioning the ability of programs to meet new requirements and the diminished role of states in the grants process. So far, leaders at CNCS and at AmeriCorps-funded programs – represented largely by the Save AmeriCorps coalition – have impressed each other with their willingness to work toward a middle ground. The next move is up to CNCS.
The new rules would make significant changes in the amount of support CNCS could give an AmeriCorps program. They stem from demands by Bush and some House Republicans that CNCS bring more structure and accountability to the way it selects and funds programs, and that grantees increase the amount of money they raise from the private sector.
Currently, CNCS can provide a grantee with up to 85 percent of its costs for each AmeriCorps member (now $12,400 per year) and up to 67 percent of the total operating cost for its AmeriCorps program.
The new rules would require grantees to gradually decrease their reliance on CNCS money. By the 10th year of funding from the agency, an organization would have to provide 50 percent of its combined member and operational costs. Only money from nonfederal sources could count in that figure.
Grantees would report their financial information to the state service commissions and national direct groups, who administer volunteers to organizations in more than two states. Those entities would then report to CNCS.
Eisner hopes that putting a graduated scale in place will make it easier for grantees to leverage funding from the private sector and foundations. “We’re looking to understand the extent to which increasing the match actually helps fund raising, in the same way that when you give somebody a challenge grant it’s easier for them to match it than it is for them to raise it independently,” Eisner says.
Another rule adjustment would place a premium on cost efficiency when selecting applicants to fund.
Grant selections would be based on the same three criteria as they are now: program design, organizational capability and cost effectiveness. But cost effectiveness would account for 25 percent of the criteria, an increase of 10 percentage points, reducing program design from 60 percent to 50 percent.
“All things being equal,” the proposal says, “an applicant proposing a lower cost per full-time employee will be more advantaged in the selection process.”
Stakeholders in the process worry that these adjustments will crowd out vulnerable organizations that have little experience raising funds or that choose more expensive service models.
“They have to be careful not to turn AmeriCorps into a champion grant-writing process,” says Kyle Caldwell, chairman of the American Association of State Service Commissions, referring to the higher weighting of cost efficiency.
The coalition opposes the greater emphasis on cost because it says that would place an unfair burden on some organizations, such as those using disadvantaged AmeriCorps volunteers instead of college students or graduates. Because disadvantaged youths require more training and support and are more likely to leave AmeriCorps early for jobs or school, programs that use them are likely to have higher costs.
“AmeriCorps … is not a one-size-fits-all program,” says a position paper from Save AmeriCorps to CNCS. “Some models will inevitably be more expensive than others because of the nature of the service they perform, whom they recruit to do the service, [and] where the service is done.”
There are similar concerns about the idea of having one fund-raising match level for organizations that serve a wide range of populations. Sally Prouty, president of the National Association of Service and Conservation Corps and a founding member of Save AmeriCorps, says the coalition believes it has not been given enough data – despite several requests – to determine whether the corporation’s faith in higher matching is misplaced.
“The corporation has information that led them to think that this is possible,” Prouty says. “If we’re looking at the same information, we can reach informed conclusions.”
Eisner says data to back up the match proposal are public. Nineteen percent of grantees already match more than 50 percent of their AmeriCorps money with other funding, he says, and nearly 70 percent match 30 percent or more.
But there are doubts that the private sector would support half the funding for the entire network of AmeriCorps programs. Save AmeriCorps’ position paper says that nationally, only 13 percent of private giving goes toward human services or “public-society benefit.”
“We do not get the kind of money we would like from the private sector,” says Shirley Sagawa, a consultant and a chief architect of AmeriCorps in the Clinton administration. “Barring a sea change in terms of foundation priorities, my fear is the rules are going to result in cheap programs that aren’t good and programs that serve populations that aren’t the neediest.”
The most vulnerable programs appear to be those in rural areas, such as Appalachia Cares in Rutledge, Tenn. The agency sends its volunteers to 11 rural school districts to do service-learning projects with students.
Director Trenna Brown says that of all the federal grants going to her host agency, the Clinch Powell Resource Conservation and Development Council, the AmeriCorps project already has the level of matching funds.
“I do not think we would survive” under the new rules, Brown says. “There is only so much cash we can leverage out there in this community.”
Critics say the new regulations would also grant a larger amount of discretion to the corporation, taking power away from the state commissions, which would have a percentage of their funds reserved for new applicants. That percentage could change any time, at the discretion of the corporation.
If the rules provide more flexibility at the federal level, Caldwell says, “it changes the commissions from partners to more of a pass-through.” Save AmeriCorps writes that leaving more money open each year for new applicants approved by the corporation would undermine “the states’ role in determining proper local balance.”
Sagawa sees a trace of irony in a Republican-led agency, pressured by Republican congressmen, moving to centralize power for the program. “When we were putting the AmeriCorps legislation together, there was a lot of pressure from conservative legislators to put more money through the states,” she recalls. “It was a compromise that the Clinton people made to let states control two-thirds of the funding.”
Despite considerable distance between them on the rules, both sides say they’re pleasantly surprised that they’ve maintained an objective tone in the discussions.
Grantee representatives say while they don’t like a lot of the proposed changes, Eisner’s approach to making them has been exemplary. “I’ve been in David’s shoes, so I know what kind of line he’s trying to walk,” Sagawa says.
Eisner won over many grantees by holding an initial public comment period just on the ideas suggested for rules, then modifying or eliminating some of the least popular proposals.
“We appreciate the removal of the sunset provisions from the rules,” says Caldwell, referring to a rule proposed by House Republicans that would have set time limits on how long a program could participate in AmeriCorps. “We applaud the thoroughness and openness with which they’ve conducted rule making.”
Eisner praises the ability of national representatives to speak to the needs of the field at large and for their respective niches.
“The field appears to be maturing on a lot of different levels,” he says. “The national directs and state organizations are able to talk with each other. They, of course, can’t use federal funds for lobbying, but at the same time they seem to have found a voice. Save AmeriCorps has been a big piece of that.”
Save AmeriCorps was formed by a group of Washington AmeriCorps advocates during the funding crisis of 2003. It has since grown to include more than 100 regularly involved members, ranging in size from national programs like City Year and Public Allies to the Susanna Wesley Family Learning Center in East Prairie, Mo. Its efforts helped engineer strong support for $200 million in emergency funding in the Senate, but failed to secure support in the House.
The coalition has steadily gained clout since then, while tempering its influence over any one member by remaining a loose network. Nobody serves as its spokesman, leaving position papers and press releases to stand as statements of its members’ unanimous interests.
The coalition’s website includes statements of support on its rule positions from every corner of youth work: private companies, foundations and nonprofits and from 24 U.S. senators.
“These are just draft proposals. The purpose was to get as much comment as possible,” Eisner says. “We’re receiving a tremendous amount, and the quality of the comments has been very high.”