25-1276 : City of Buffalo - Discretionary Fund Policy - Fiscal Year 2026

This agenda item concerns the City of Buffalo's Discretionary Fund Policy for Fiscal Year 2026. The policy outlines guidelines for the use of "Neighborhood Initiatives" accounts, which are designated for expenses benefiting the public, such as supporting community groups and events to enhance quality of life.

Key Policy Points:

• Contractual Requirements: All procured goods or services must be under a dual-executed contract approved by the City's Law Department, including proof of insurance, permits, licenses, IRS designations, a defined scope of services, an operating budget, and a conflict of interest statement if applicable.
• Funding Limits: Contracts to any single recipient cannot exceed $50,000, including amendments. No exceptions will be granted.
• Reporting and Compliance: Recipients must submit a discretionary funding grant budget and expenditure summary report with invoices, proof of payment, and supporting documentation. Failure to comply before new requests or by fiscal year-end will result in no additional funding until compliance is achieved. Receipts must be submitted within 30 days of expenditure, and contracts not closed within a year of receiving funding are ineligible for future funding until cleared.
• Fund Management: Discretionary Funds must be listed by District, not as one aggregate fund. Unencumbered funds will not roll over to the next fiscal year and will be returned to the General Fund.
• Prohibited Uses: Funds cannot be awarded to organizations employing elected officials, their staff, or family members in decision-making roles. Grants are for Not-For-Profit Organizations located within Buffalo, must not be the sole significant funding source, and must be for activities open to all residents. Loan programs, scholarships, and fundraisers are not eligible.
• Procurement: Procurement of goods above $10,000 requires an informal bidding process, with preference for local companies where feasible. Procurement over $20,000 must follow the City's standard procurement process. Capital purchases are prohibited effective July 1, 2025.
• Public Officers Law: The policy references Public Officers Law §73-b, prohibiting elected officials or candidates from appearing in advertisements paid for with city funds.
• Unallowable Costs: Specific unallowable costs include sales tax, tickets for social fundraising events, patronage advertisements, and rehabilitation/improvement to private property structures. Snow removal, lawn mowing, yard maintenance, and residential/commercial repairs are also excluded.

This policy has been in discussion and tabled by the Finance Committee multiple times since July 2025, with the next scheduled review on January 13, 2026.