Over the past couple of weeks, we’ve been seeing some long-awaited funding decisions. If you’ve been hearing nothing but crickets about federal grants you submitted months ago, now is the time to be on the lookout. (It is also time to be watching our Grant Round Up closely.)
With the passage of a half-dozen appropriations bills last month, many agencies are finally making decisions on grant programs that have been gathering dust. We have been a little surprised by how many questions we’ve gotten about the reason for the holdup.
The federal budget process has significant implications for grant award timelines due to its influence on the availability and distribution of funds across various federal agencies and programs. Here’s a short civics lesson on the budget process and how it impacts these timelines:
Step 1: Preparation of the President's Budget Proposal
This typically starts at least a year before the fiscal year begins on October 1. Agencies submit their budget requests to the Office of Management and Budget (OMB). During this period, agencies plan their programs and determine funding needs, including allocations for grants. Uncertainties in funding requests can delay the planning of new grant programs.
Step 2: Submission and Congressional Action
The President submits the budget proposal to Congress by the first Monday in February. In theory, Congress reviews, modifies, and approves budget resolutions. The debates and decisions in Congress can lead to shifts in funding priorities. Delays in Congress (e.g., failure to pass appropriations bills on time) can directly delay the availability of funds for grants, postponing grant announcements and application processes.
Step 3: Appropriations
Congress must pass appropriations bills to allocate funds to specific federal agencies and programs. Again, theoretically, this process should conclude by the end of the fiscal year on September 30. If appropriations are delayed or if a continuing resolution (CR) is passed instead, agencies may not know their final budget allocations, affecting their ability to announce and award grants. Under a CR, agencies typically operate under the previous year's funding levels, which can restrict their ability to fund new initiatives or expand existing programs.
Step 4: Agency Allocation
Once appropriations are clear, agencies allocate funds internally and prepare to distribute them. Delays in this phase can further push back grant announcements. Agencies might also revise funding amounts based on the final budget, affecting the scale or scope of grant opportunities.
Step 5: Grant Announcement and Application
After internal allocations, agencies announce available grants. Timing of announcements is contingent on prior steps. Any delay up the chain can result in delayed grant opportunities and shorter application windows, which can challenge grant seekers.
Step 6: Review and Award
Following the application deadline, proposals are reviewed—a process that can take several months. The start of this phase depends on the completion of all prior steps. Delays in funding decisions mean delays in project start dates and potential rescheduling of project activities.
Key Takeaways
We aren’t going to get up on our soapbox about federal budget brinkmanship. But we will point out that the federal budget process is inherently political and subject to negotiation, which can introduce variability and delays into grant timelines. For organizations reliant on federal grants, understanding this process is crucial for planning and expectations management. Awareness of potential delays can help in strategizing submissions and preparing for possible funding gaps.
It is important for grant-reliant organizations to follow the budget process. When the budget process goes sideways, we can expect delayed awards and compressed competitions. If this is going to put your organization in a bind, you should reach out. We can provide the support you need to meet the tightest deadlines.