In a time when money is tight in the public sector, things become more competitive when a community is seeking money for economic development. I write grants, and know that the level of the quality of applications is higher when there is less money. 

Much of the time, the types of grants a community can apply for is dictated through the availability of local match money. Where there is an issue with raising the local match, the types of grants and availability of grants are limited.

If a community has an opportunity, it is common practice to use the local match as the initial phase of a building block program, to lessen the burden on the local entity application. That may sound contradictory, but it is not in the world of public finance, where the match can be shifted.

I will use the example of the Phoenixville north side project. For those who know Phoenixville, the north side is an area that has, over the years, endured many problems with deterioration of some of the housing stock, as well as social issues like heroin abuse and drug dealing. 

The downtown strategy called for improving the public conditions on the north side. I worked with Pamela Dunn from the “community watch” to secure match to improve Andre Thornton Park, as well as provide improved lighting and sidewalks on High Street. Without the late Ms. Dunn, none of those improvements would have happened. As an advocate for the north side, she lobbied the borough council to provide match for grant applications. The council had to put up 50 percent of the streetscape and 50 percent of the park project. The park project was $120,000 and the streetscape project was $500,000 meaning that the Borough had to put up a combined $310,000 in match money to do the projects.

Once the match was secured, we were able to go to work securing grants through the Commonwealth Department of Community and Economic Development and the Commonwealth Department of Conservation and Natural Resources for the other half of the money. Because we had the match, we were eligible for the grants, but those were not the only grants that were available for the project.

We then sought to apply for Community Development Block Grant (CDBG) from Chester County for the Streetscape, and were planning on asking for $250,000.  What we found was that there were new developments on the north side that had raised the median income, and the area was not eligible for it based upon the population demographics. It did qualify because it was an accessible path project which had an impact on the mobility of handicapped individuals. So although the “area” did not qualify, the “activity” qualified, and we matched the “local match” and used that match for the “local match” as the match. Combing those two projects enabled the borough to reduce their $310,000 match to $60,000.

We then looked at another Chester County program that provided county bond issue money for park improvements. The problem with the County money was that there was a required 15 percent local commitment, which meant that 15 percent of the entire project had to be local dollars. I tried to argue that there was a need to provide 15 percent of their dollars, rather than 15 percent of the entire project, because I felt the language was open to interpretation. I complained and was told by a staff member if I did not like it, to “take it up with the County Commissioners.”  Being a stickler for procedure and protocols, I showed up at the next commissioners meeting and asked if I could match the county money with the state money and it created some animosity toward me by some of the county parks and recreation staff. The commissioners seemed to get a grasp of what I was asking, and seemed to side with staff, while they took time to evaluate my request. 

So we had to come up with 15 percent of $120,000 instead of 15 percent of $60,000.  So our cost was $18,000 and not $9,000 as I had lobbied for with the staff person. The fact that I was directed to a higher authority enabled me to make the $9,000 match and the zero match (with the commonwealth park dollars acting as the entire match) a policy argument. 

So the match was reduced from $310,000 to $18,000 providing a savings of $292,000. We then did a park acquisition for almost $900,000, also on the north side, doing the same kind of match. In that case our local contribution was $135,000 toward the match. 

This case study shows what could be done by a community to promote economic and community development. But pledging match money does not always mean that will be the contribution that is finally agreed upon. Now this kind of finance is not for the faint of heart, because you may not get any of the other grants, and you will need to pay the entire amount of the match.  But… agencies like the combined effort, and it shows that everyone is on board with the project throughout the levels of government.

In times of tight dollars, these kinds of strategies could turn around a downtown in a few years.  The fact remains that many on a local government level are really not equipped to do this kind of financing, because it is a risk and people lose their jobs sometimes if they get a community too far out on a hook. A community needs to know and needs to understand that at anytime, that it could be the case that the entire amount may be the eventuality. 

Barry Cassidy is a freelance grant and economic development consultant. He can be reached at barrycassidy@comcast.net.