Nearly $50 million in state grant funds isn’t getting to nonprofits that need them to run programs because of bureaucratic holdups and missing language from the state’s budget bill.

The process and paperwork to access those funds has also been slow going for some organizations, employees of nonprofit organizations said.

The Legislature changed the process this year and funneled all the grant money into one state office to oversee. Previously, the funds had been spread across the state government to work directly with nonprofits. The money has generally become available in July.

There’s also some concern that language in the state budget bill passed by legislators earlier this year didn’t specify what money would be set aside for grants, which may also complicate the process.

Regardless of the cause, the effect is certain: programs to help individuals with disabilities, to refurbish parts of Chinatown, to help sexually victimized children, and dozens of other initiatives can’t begin because the money isn’t yet available to nonprofit organizations.

Capitol building under construction 2022.
Problems stemming from the state budget bill may be slowing awards for some nonprofit organizations. Cory Lum/Civil Beat/2022

It’s not clear yet when that money might become available. Nonprofits contacted for this story described being in various stages of filling out paperwork.

The state Office of Community Services, overseeing more than $49 million in grants-in-aid awards this year, did not return a call seeking comment for this story.

“It’s hard to lay the blame on one individual,” said En Young, executive director of the Pacific Gateway Center and a former OCS employee. “There’s a lot of moving parts.”

The problems began with the budget bill this year, House Bill 1600. In years past, bills appropriating money for state grants in aid contained one key line, repeated for each of the dozens of awards, that said money is being appropriated “as a grant pursuant to chapter 42F,” referring to the state grants law. That line is missing from the final language of HB 1600.

The Legislature also changed how grant funds are distributed. In the past, grant awards were appropriated to various state departments to oversee funding and to work with nonprofits in their subject areas.

The Office of Hawaiian Affairs worked with Hawaiian organizations. The Attorney General’s Office worked with legal and law enforcement organizations. The Department of Agriculture worked with nonprofits supporting farmers.

This year, all of the grant funds, and therefore the responsibility for overseeing them, was put under the Office of Community Services, an office under the state Department of Labor.

The office’s budget went from $2 million annually to more than $51 million this year. Most of those funds are monies for the grant awards, according to budget documents.

Typically, after the Legislature awards a grant, there’s follow up paperwork that a nonprofit needs to complete. The department overseeing the grant also needs to ask the state Department of Budget and Finance to release those funds.

Pacific Gateway Center Executive Director En Young speaks to our ed board.
Pacific Gateway Center Executive Director En Young, who was a contract administraotr for OCS, said a myriad of issues could be delaying grant awards. Cory Lum/Civil Beat/2022

Even after a contract is signed and money actually goes out to the nonprofits, a rigorous grant monitoring process follows, which requires further follow up between the department and the nonprofit.

All those tasks apparently now fall to OCS. The Legislature also increased the number of employees in the office from four to 10, but it’s not clear how many new employees have been hired.

Young, who worked as a contract administrator at OCS, said workers there already have duties besides just overseeing the grant awards. Those duties may have also increased as the administration prepares to change hands in December.

Some nonprofits only recently received some of the follow up paperwork to continue the grant awarding process.

Sandra Pohl, executive director of the Downtown Art Center, said her organization just received some of that paperwork last week.

The arts center was awarded $150,000 to help it hire some staff as part of an effort to grow the arts community around Chinatown.

She said “it seems we’re on the right track,” but was not sure if or when funding might come.

Cara Short, executive director of AccesSurf Hawaii, along with her staff are making their first foray into the state grants process. The nonprofit previously applied for grants from the City and County of Honolulu.

AccesSurf Hawaii runs adaptive water sports programs for people with disabilities. It lost some of its volunteers who help run those programs during the pandemic and needed to train new ones or retrain returnees.

The organization was awarded $150,000 for a volunteer training program, but the program hasn’t started yet.

“We were hoping to have the ball rolling already,” Short said. “We thought it’d be in place by the fall so we can ramp up and get ready for next year.”

Even without the new state funds, Short said the organization is still running its water sports programs.

“We’d just hoped it came a little sooner,” she said of the grant awards.

An Important Note

If you consider nonprofit, independent news to be an essential service that helps keep our community informed, please include Civil Beat among your year-end contributions.

And for those who can, consider supporting us with a monthly gift, which helps keep our content free for those who need it most.

This year, we are making it our goal to raise $225,000 in reader support by December 31, to support our news coverage statewide and throughout the Pacific. Are you ready to help us continue this work?

About the Author