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City’s Neighborhood Opportunity Fund Has ‘Potential’ But Lacks Way To Measure Success, Watchdog Says

An audit released Wednesday says the city cannot tell if its grant program is having an impact on the South and West sides because it doesn't have measurable goals.

A packet for the Neighborhood Opportunity Fund Grant Application at Plamen Art Foundation, 6950 S. Stewart Ave., which occupies an abandoned, burnt out church in Englewood on Sept. 15, 2021.
Colin Boyle/Block Club Chicago
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CITYWIDE — The Neighborhood Opportunity Fund small grants program needs improvement, according to an audit released Wednesday from the city’s watchdog.

The grant program, managed by the city’s Department of Planning and Development, awards grants up to $250,000 for development projects supporting “commercial corridors in Chicago’s underserved neighborhoods” on the South and West sides.

Grants are used to reimburse business or property owners for the construction or rehabilitation of real estate and projects that support new or expanding businesses or cultural assets.

While the city’s Office of the Inspector General found the small grant program to be “well administered,” it also found the program does not formally measure its performance, according to the Wednesday report.

“Without measuring the program’s performance against specific goals … [Planning and Development] cannot establish whether the program actually strengthens commercial corridors in disinvested neighborhoods,” according to the Office of the Inspector General.

The office had four recommendations to tighten and improve operations of the program. Planning and Development is still working to make the recommended changes, according to the report.

Planning and Development officials were unavailable for comment Wednesday.

The Neighborhood Opportunity Fund has two programs: a small grant program awarding up to $250,000 and a large grant program awarding up to $2.5 million. The report audits the small grant program as each is managed by two different divisions within the Department of Planning and Development.

Since the program began in 2017, the small grants program has awarded $32 million to 187 grantees, according to the report. About $11 million has been paid out to recipients, with 59 projects fully completed, 80 under construction and 48 that have dropped out of the program.

The audit found the Department of Planning and Development has not collected quarterly reports from the program’s administrator, SomerCor.

The reports should have included valuable project metrics such as the total number of projects closed, vacant commercial units occupied, jobs retained and created, percentage of applications funded and more, according to the Office of the Inspector General.

“If collected and reported, this information would allow [Planning and Development] to measure performance in each of these dimensions against any established goals,” according to the report.

As a result, the Office of Inspector General has recommended the department create measurable goals, develop procedures to measure performance and seek quarterly reports from SomerCor.

In the audit, James Harbin, deputy commissioner with the department, said his staff is working with a Bloomberg Associates team to establish measurable goals and will implement an official quarterly program review.

Additionally, the audit reviewed the selection process for 24 grantees awarded in 2020. It found the Department of Planning and Development mostly complied with its selection process steps, but it was missing documentation for six of its 18 steps.

The biggest misstep was hardcopy documents from the Department of Buildings that were not kept after being reviewed. Also, applicants who replaced others who dropped out where not reviewed by the program’s advisory committee, according to the Office of the Inspector General.

Harbin said the Department of Planning and Development will create a document to track replacement projects, according to the report.

No timeline on when the changes would be completed were included in Harbin’s responses. The small grants program is accepting applications for its 2023 disbursement. Applications are due Feb. 24.

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