Chapter 3 of the Administrative Code addresses budget processes and procedures, while Chapter 21G governs grant procurement and awards. Neither accounts for cost of living or other service costs relating to inflation in multiple years, nor addresses the desired term length of grants.

The legislation amends the Administrative Code so the Controller will assist departments in developing two-year base budgets by anticipating cost increases for agreements with nonprofit organizations for services in subsequent years. It also establishes a City policy that grant agreements will last for multiple years when there is an anticipated need extending beyond one year, with departments considering inflation costs when developing and negotiating grant plans.

Provides a more stable funding structure for departments and grantees, enhancing long-term planning and accounting for inflation, which aligns with state efforts to extend and stabilize grant terms.

City grants have typically been issued on a yearly basis, but services are recurring, and multi-year City contracts would allow better planning. The changes also prepare the City and its grantees to handle impacts from the Minimum Compensation Ordinance and other inflation-related costs.

Departments are instructed to create multi-year agreements where service needs span more than one year and to account for inflation and cost changes in these agreements. The Controller is also instructed to incorporate inflation related to nonprofit agreements within the City's base budget.

The changes allow for informed decisions about the budget's costs and impacts, letting departments and nonprofit organizations plan for changes to program costs. It intends to streamline contracting and reduce the annual need for contract modifications related to the Cost of Doing Business (CODB) and to treat certain costs, like Civil Service salaries and benefits, in alignment with the anticipated need for services.