Panel requests authorization to spend money it gets through grants, other activities

Benicia Community Sustainability Commission will ask the City Council on Tuesday for authority over money it generates through grants, fundraisers, profit-sharing and revolving loans as it endeavors to achieve the goals of the city’s Climate Action Plan.

A staff report, however, said that such authority would exceed powers granted other panels.

As an alternative, the report suggested that some CSC members form an independent, nonprofit organization to raise, manage and spend the money.

“In regards to fundraising, (CSC) is seeking the authority to both raise money and spend it without Council oversight,” interim Community Development Director Dan Marks wrote in a Dec. 11 report about the request, which was initially made May 19.

The CSC’s request was given to the Council July 2, during Chairperson Constance Beutel and Vice Chairperson Kathy Kerridge’s annual report on their panel, but the request wasn’t part of the Council’s agenda that night.

Beutel sent the Council a memorandum that said if the CSC funds a grant, applies for an outside grant or conducts a fundraiser, and the CSC grant has the potential to return funds, such as a percentage of profit; or if an external grant provides new funding for future allocations through the CSC or money is raised through CSC activities, “the City Council will allocate that designation of funds to the CSC for future actions.”

Marks wrote that the CSC has asked that money it raises through its direct efforts without help from staff be allocated to the panel to use in fulfilling its mission.

Should it be successful in raising money, he wrote, “it would augment the city’s efforts to implement the Climate Action Plan.”

However, there would be some impact on city employees, he wrote, as they would be responsible for tracking and administering the grants and helping the commission with activities it may undertake using that money.

City staff also would have to administer grants and track the funds, Marks wrote.

“Some outside grants include limited funding for reimbursement of administrative costs, but those administrative allocations are rarely sufficient to reimburse the city for the staff time required,” he wrote.

The additional work load also might displace other tasks, he wrote.

Should the Council agree to the CSC’s request, Marks wrote, the commission would join three advisory panels that are able to raise money or seek grants: the Parks, Recreation and Cemetery Commission, which hasn’t acted on that authority, and the Arts and Culture Commission and Human Services Board, both of which have raised money.

The ACC and HSB both seek Council concurrence before they spend donated money, Marks wrote. HSB has adopted a Council-approved policy on distribution of funds, he wrote.

That panel raises money and receives donations to support community service nonprofit organizations, and the Council ratifies how the money is to be treated, he wrote.

The ACC has the authority to receive grants, though the only ones it has obtained have come from the Community Sustainability Commission, which also were approved by the Council, he wrote. City employees have advised the ACC that participating in outside grant activities also would need Council authorization.

There’s a reason Council approval of grants is required, Marks wrote. “Grants obligate the city to undertake certain activities and have a potentially significant impact on staff resources, which can displace other city priorities,” he wrote.

“The CSC is essentially seeking authority that no other commission or board currently exercises: to have full authority over the money it raises,” he wrote, explaining that the CSC has asked to decide how the money would be spent without Council approval, so long as the donations are used in furtherance of its mission.

“As much as a commission may want, in good faith, to undertake such activities without staff assistance, it is often necessary for staff to provide some logistical and administrative assistance with these efforts,” Marks wrote — which would include tracking grant money to assure grantees are conforming with the grant’s conditions.

Currently, the city’s municipal code doesn’t allow the CSC to apply for grants without Council approval, Marks wrote, though finding grants for which the city could apply is within the panel’s authority.

“Grants almost always come with costs in regard to staff time and city priorities that should be taken into account before they are applied for,” he wrote, adding that allocation of city resources usually is the job of the Council.

The CSC has considered providing a grant to a startup company that might have a new technology or provide a service that would further Benicia’s sustainability goals, and has discussed having a profit-sharing agreement with such a company, Marks wrote.

It also has considered establishing revolving account grants, he wrote.

The city currently has no similar programs, and tracking revolving loans “would require a significant commitment of staff resources,” he wrote.

Costs as well as benefits would need to be weighed, he wrote, explaining, “Staff’s limited experience with revolving loan funds is that the costs of such programs are high, and tend to reduce or eliminate potential benefits.”

Marks wrote that if the Council authorizes the CSC to raise and spend money without Council consent, the city code must be amended and the Council would need to establish a specific policy that would state how money would be raised and spent.

But he added that city staff isn’t recommending the CSC have full authority of any money returned in profits or through revolving loans. “Additional research is needed on the costs and benefits of a city engaging in such activities,” he wrote. Even if the proposal looks appealing, “it would still involve substantial staff resources to implement, and staff believes any funds that may accrue (should) be allocated by the City Council.”

On the other hand, he wrote, if CSC members want to act on their own to raise, manage and spend money, “then the appropriate course of action would be for them to form a separate nonprofit organization.”

The Council will meet at 6 p.m. Tuesday in a closed session to discuss legal matters. The regular meeting will start at 7 p.m. Tuesday in the Council Chamber of City Hall, 250 East L St.