Sioux Falls is changing how it provides subsidy funds to businesses and nonprofits. This comes in response to expected drops in property tax revenue.
Subsidy agreements with outside organizations used to be embedded in city budgets and directed to those organizations. Now, Sioux Falls is shifting to a more competitive model through a Request for Proposal, or RFP, process. That gives any organization the chance to compete for city funds.
Shawn Pritchett is the Director of Finance for the City of Sioux Falls. He said the move adjusts to expected revenue shortfalls, provides more accountability over funds and puts dollars where the city wants them.
“It also allows us to refocus our city priority areas and making sure that the organizations that we’re funding are aligning with what the city priorities are going forward,” Pritchett said.
Those priorities are separated into three areas: the first is at-risk populations, the second is culture, arts and community programming and the third is economic vitality and growth. Pritchett said there will be RFPs issued for all three areas.
The city is encouraging all organizations to apply, including those who have previously received funds. Pritchett said that includes nonprofits and organizations teaming up on proposals.
“Our hope is that organizations will come together with joint applications because the key thing with an RFP process is we can only award to one entity or one proposal for each of the scope of work,” Pritchett said.
He added that exact fund amounts aren’t known yet.
“We’ve proposed a certain amount of pool of money," Pritchett said. "That’s subject to an amendment by the city council if they choose to change the amounts that are allocated to each of the three areas.”
There’s approximately $1.2 million across the three target areas in the Sioux Falls budget right now. Pratchett said he expects a budget approval on Sept. 9, and the city would issue a formal RFP accordingly.
He said informational work sessions are being held on Thursday, Sept. 4 in City Hall from 2-5 pm for stakeholders and interested entities to attend.
Those will be broken down into three different, one-hour sessions. The first hour focuses on the at-risk population RFP, the second on the culture, arts and community programming RFP and the third on the economic vitality and growth RFP.
