Consideration and recommendation of FY 2025-2026 Council Discretionary Grant Funds and provide direction for the disbursement of the funds to various organizations (Estimated time - 30 min)

Consider applications submitted as part of the Fiscal Year 2025-2026 Council Discretionary Grant Program and provide funding recommendations to staff:

1. Provide direction regarding the total amount of funding to allocate for FY 2025-2026 Council Discretionary Grants to include in the budget for adoption in June; and

2. Provide direction regarding how to distribute the funds allocated to the eligible applicants who applied for a FY 2025-2026 Discretionary Grant.

Background 

The City of Carmel-by-the-Sea recognizes the important role that local nonprofit organizations and Carmel schools play in enhancing the well-being of the community. In support of these efforts, the City historically allocates funding for Discretionary Grants as part of the annual budget process. 

In 2017, the City Council adopted the City Council Discretionary Funds Grant Program Policy ("Grant Policy," Attachment 1) to establish a clear and consistent framework for organizations seeking support, and to assist the Council in making funding decisions that prioritize public benefit.

To be eligible for funding, applicants must:

• Be located within or serve the Carmel-by-the-Sea community;

• Be a nonprofit 501(c) organization or Carmel school;

• Directly provide the services for which funding is sought;

• Have no outstanding debt owed to the City; and

• Not be financially dependent on City funding for operational needs.

The Grant Policy also outlines specific exclusions, such as scholarships, political activities, debt payments, and general operating expenses like salaries and utilities.

Executive Summary

The Council Discretionary Grant Program operates on an annual cycle, with the overall funding amount determined by Council during the budget process. Although not all applications are guaranteed funding, applications are evaluated for eligibility, completeness, and the positive impact on the community.

For the FY 2025–2026 Grant Cycle:

• The application period ran from February 5 to March 21, 2025.

• Outreach efforts included postings on the City’s website, the Friday Letter, the Pine Cone newspaper, and targeted email notifications.

• Staff received 19 applications requesting a total of $53,600 — a higher volume than usual.

• A preliminary budget of $36,000 is proposed for grant funding, subject to Council’s final decision.

Application Review Process 

The City Clerk conducted an initial eligibility review of each application based on the Grant Policy criteria. All 19 applicants met the eligibility requirements, and a summary of the grant applications received is included as Attachment 2. Due to the large volume of grant applications received, the applications are included as Attachment 3, and the supporting documents submitted with each application (IRS Letter, Current Operating Budget, Past 2 Years of Financial Statements) are available from the City Clerk's office upon request. 

Staff evaluated applications based on the number of Carmel-by-the-Sea residents served, the level of community need addressed, and alignment with Council priorities.  Staff recommends awarding partial funding to all eligible applicants, grouped by service or priority category.

Funding Recommendation

The table below summarizes staff's recommended funding allocations by category:

Fiscal Impact

A preliminary allocation of $36,000 has been identified in the FY 2025–2026 budget for the Council Discretionary Grant Program. The staff’s recommended allocation total of $30,000, providing flexibility for any Council-directed adjustments, as well as reserving funding for likely off-cycle funding requests after budget adoption. 

Recommendation:

Staff requests that the City Council:

1. Confirm the total funding allocation for the FY 2025–2026 Council Discretionary Grants; and

2. Provide direction on the distribution of grant awards to eligible applicants, either by approving staff's proposed funding amounts, or providing alternative direction. 

None for this action. A preliminary $36,000 is allocated for FY 2025-2026 Council Discretionary Grants, subject to change upon direction from Council. Funds will be disbursed post-budget adoption, after July 1, 2025.

In June 2024, City Council allocated $36,000 for Discretionary Grant Funds for the FY 2024-2025 Budget.