To: Board of Supervisors
From: Monica Nino, County Administrator
Report Title: Measure X Phase 2 Innovation Fund Recommendations
☒Recommendation of the County Administrator ☐ Recommendation of Board Committee
RECOMMENDATIONS:
1. RECOGNIZE and ACKNOWLEDGE all of the Phase 1 and 2 Innovation Fund applicants for their participation in this grant opportunity.
2. APPROVE Measure X Phase 2 Innovation Fund awards totaling $1,647,500 to four Phase 2 applicants listed on Attachment 1 and AUTHORIZE and DIRECT the County Administrator to negotiate and execute grant contracts with each grantee organization.
3. APPROVE recommendation of the Review Panel to reserve the unallocated balance of $322,500 for project contingencies or future grant supplementation.
FISCAL IMPACT:
The $2,000,000 Innovation Fund derives from a one-time Board allocation of Measure X sales tax revenue. Six Phase 1 planning grants of $5,000 each were awarded in May, leaving a fund balance of $1,970,000. Recommended Phase 2 grants, if approved, will reduce the fund by $1,647,500, leaving an unallocated balance of $322,500.
BACKGROUND:
On November 16, 2021, the Measure X Community Advisory Board presented a report and recommendations to the Board of Supervisors for expenditure of Measure X revenue. Among the many recommendations approved by the Board of Supervisors that day was a one-time allocation of $2 million to establish an Innovation Fund to seed pilot programs and innovative projects. The recommendation included allocating these funds to the County Administrator’s Office for development of Innovation Fund guidelines for review by the Board’s Finance Committee prior to issuing a request for proposals.
Under the guidance of the Board and its Finance Committee, the County Administrator’s Office administered a two-phase competitive bidding process seeking innovative public service programs for possible award of funds. This process was guided by the following Board-adopted principles and program priorities:
Guiding Principles:
• The first question is not ‘Is this going to work?’ but rather, ‘If it works, would it matter?’
• Unlike traditional grantmaking, intentionally seek to trade off probability of success in return for greater potential impact.
• Invest in approaches that may have a higher risk of failure, but the potential to be lasting and truly game changing if they succeed.
• Seek out ideas with transformative potential, take risks on less proven approaches, and recognize that innovation requires flexibility, iteration and, yes, even failure.
• Strive to balance rigorous analysis with intuition about a project’s potential for transformative change.
• The impact from one or two big, transformational successes in a portfolio can justify the opportunity cost of many failures.
• Recognize that money given away for social purposes is effectively gone, regardless of outcomes.
Innovation Fund Priorities:
• Projects that respond to local service needs
• Projects that improve equitable access to public services
• Projects that remove structural barriers that cause inequities and poverty
• Projects that have the potential to provide the greatest impact for every dollar spent
• Projects that have potential for transformative change rather than simply replicate safe, established programs
Proposals were invited under the following categories:
• Safe & Engaged Communities - Improving health, wellness, and public safety outcomes through community outreach/awareness, education, and engagement.
• Agriculture and Food Systems - Improving environmental health, economic profitability, and social and economic equity.
• Economic Vitality - Providing education, job training, decent jobs, and viable businesses to reduce the number of people at a poverty level.
• Clean & Sustainable (Clean and Green) Environment - Safe food and water, proper waste disposal, clean air, pest control; preventing waste.
• Reliable & Accessible Infrastructure - Modernization, technology, or equity in digital access, cybersecurity, and resilience.
With input from the Board's Finance Committee, the County Administrator convened a diverse and highly qualified 7-member review panel composed by the following individuals:
The County Administrator is deeply appreciative of the time and effort volunteered by the Panelists, all who served during both phases except for Dr. Moore, who was unavailable to fully participate during Phase 2. Many hours of study, thought, and discussion were required to develop the recommendations presented to the Board today.
Phase 1 Summary. Phase 1 was conducted from November 1, 2022 through May 23, 2023. Fourteen qualifying applications were received during Phase 1, with one applicant later withdrawing, leaving thirteen applicants. In May 2023, the Board approved the Review Panel’s recommendations to advance eight of the thirteen proposals to Phase 2. Of the eight applicants, one was subsequently disqualified, leaving seven potential Phase 2 proposals.
Phase 2 Summary. Phase 2 was initiated on June 23, 2023 following a mandatory bidders’ conference on June 22. Of the seven applicants invited to participate in Phase 2, six of the seven submitted proposals by the August 7 deadline (see Attachment C - Request for Proposals). The total amount requested by the six applicants is $2,726,737, which exceeds the current balance in the Innovation Fund by $756,737.
The Review Panel convened four times in September to interview the six applicants and review, rate, and rank proposals in accordance with the guiding principles and priorities adopted by the Board and determine funding recommendations. The rating rubric, which was communicated at the June bidders’ conference, can be found in Attachment 2. Oral presentations and interviews were conducted by the Panel on September 12 and all Phase 2 applicants participated.
The County Administrator appreciates the Panel’s careful consideration of each proposal and proffers the Panel's recommendations for four Phase 2 awards today totaling $1,647,500. The recommendations showing the proposal rankings, program summaries, and amounts requested and recommended are shown in Attachment 1. The Panel recommends that the proposed unallocated balance of $322,500 be reserved in the Innovation Fund for possible future supplementation of the recommended projects, as needed and upon approval by the Board.
The Review Panel wishes to emphasize that a recommendation of “no grant award” does not in any way signify a lack of worthiness of a proposal in terms of a valid need for services, but rather reflects the fundamental criteria for this funding designation that awards be made to innovative projects and programs that demonstrate strong consistency with defined Innovation Fund guidelines.
The County Administrator today seeks Board direction on the Phase 2 grant awards. Upon direction by the Board of Supervisors, the County Administrator will negotiate and execute grant contracts in the amounts approved and authorized by the Board today.
The County Administrator also wishes to recognize the excellent support of Buyer II Dally Aleman, who administered the online bidding process, and County Counsel Tom Geiger, who provided thoughtful advice and guidance throughout the process.
Next Steps. The precise schedule for the remaining steps will depend somewhat on the cooperation and availability of the grantees. However, the Board can be assured that the County Administrator's Office is working as efficiently as possible to complete the entire process in an expeditious manner. Following are the remaining steps:
• CAO negotiates service plans and payment provisions with each grantee;
• Contracts are drafted, reviewed by legal counsel as to form, and executed;
• Target for contract effective dates is December 1, 2023;
• Quarterly monitoring and report by CAO;
• Annual evaluation and final report to BOS (target January 2025).
CONSEQUENCE OF NEGATIVE ACTION:
None.