How Much Public Money Flows Through Private Organizations?

Jacksonville doesn't provide every public service itself.

Millions of taxpayer dollars move each year through nonprofit organizations providing everything from children's programs and healthcare to homelessness services, workforce development, neighborhood improvements and, increasingly, functions connected to maintaining public spaces.

That's not inherently a problem.

In many cases, nonprofits may be better positioned than City government to deliver specialized services.

But after examining Jacksonville's nonprofit funding structure, another question becomes increasingly important:

How much public money is moving through private organizations — and what happens to the taxpayer dollar after it gets there?

That's Part 2 of The Public Money Pipeline.

This Is Already a Very Large System

There is no single line in Jacksonville's budget labeled "money given to nonprofits."

The funding is scattered across departments, special revenue funds, federal grants, children's programs, individual Council appropriations and separately approved direct agreements.

That makes a precise citywide total more complicated than simply adding one budget column.

But the scale is clear.

For FY 2025-26, Jacksonville appropriated $7.2 million for its Public Service Grant program.

Another $5.22 million was appropriated for grants funded from opioid-settlement proceeds.

And the Kids Hope Alliance budget included more than $50 million for children's services, much of which supports outside service providers.

Those three funding channels alone represent roughly $62.5 million before separately legislated nonprofit grants, housing programs, federal subrecipient programs, healthcare agreements and other City-supported organizations are counted.

So this isn't a niche corner of Jacksonville government.

Private organizations have become an important part of how public services are delivered.

Not All Nonprofit Funding Works the Same Way

That's an important distinction.

Jacksonville actually has a formal competitive system for some nonprofit funding.

The Public Service Grant program requires nonprofits to apply, compete within designated community-need categories and undergo evaluation and scoring through the Public Service Grant Council.

The City describes the program itself as competitive funding for organizations serving Jacksonville's most vulnerable residents and community needs.

That structure creates something recognizable as procurement competition.

Multiple organizations know money is available.

They apply.

Programs are evaluated.

Funding decisions are made through an established process.

Whether the process is perfect is another question.

But there is a process.

Then there is another path.

The Direct-Contract Path

Jacksonville City Council can waive the competitive evaluated award requirement in Section 118.107 of the Ordinance Code and name the nonprofit that will receive the money.

This happens regularly.

The amounts range from relatively small neighborhood programs to substantial appropriations.

In 2024, for example, Council considered $785,000 for Goodwill Industries of North Florida's workforce training program through a direct agreement.

A separate $120,000 agreement directly selected JAX Chamber to provide business recruitment and retention services.

Both involved waiving the nonprofit competitive-selection requirement.

In 2025, Council directly funded organizations including Springfield Preservation and Revitalization Council, Melanin Collaborative Group, LISC Jacksonville, Northside Community Involvement, Downtown Vision Alliance and numerous others through individual legislation.

Later that year, Council approved $1 million for the Northeast Florida Builders Association and $2 million for Edward Waters University through legislation that expressly waived Section 118.107 to permit direct agreements with those organizations.

And in 2026, the pattern continues.

The City approved a $413,900 direct agreement with Sulzbacher for additional homeless shelter capacity.

Other recent direct nonprofit appropriations include the Salvation Army, Zawyer Sports Foundation and First Coast Crime Stoppers.

And then there is the Jacksonville Riverfront Alliance.

Direct Doesn't Automatically Mean Improper

This distinction matters.

There are legitimate reasons for government to directly select an organization.

Sulzbacher already operates major homeless facilities.

A neighborhood organization may have specialized relationships within a particular community.

A university may own the facility the City wants improved.

A nonprofit may possess expertise or infrastructure that would be difficult to duplicate.

And Jacksonville's use of direct nonprofit agreements predates Mayor Donna Deegan.

So the story isn't that City Hall discovered a secret way to avoid competition.

The Ordinance Code expressly allows Council to waive competition when Council determines there is justification.

The transparency question is different:

How often is the exception becoming the method?

And when competition is waived, what additional safeguards replace it?

The Most Interesting Finding: Sometimes the Money Moves Again

This is where the Public Money Pipeline becomes considerably more interesting.

A nonprofit receiving City money does not necessarily spend all of that money itself.

Sometimes the nonprofit becomes an intermediary.

In 2025, Jacksonville appropriated $125,000 directly to LISC Jacksonville for a Small Business Employment Re-Grant Program.

Council not only waived competitive selection to contract directly with LISC; it also waived a provision of the City's grant rules so a portion of the taxpayer money could subsequently be distributed to other organizations through the program.

Northside Community Involvement received another $125,000 for a community re-grant program.

Again, Council waived the competitive nonprofit-selection requirement.

And again, Council specifically waived the normal restriction on using City grant funds for contributions or donations to other groups so that NCI could pass portions of the taxpayer money onward.

Those transactions are important because they illustrate the second layer we've been examining.

The money doesn't necessarily stop with the organization named in the ordinance.

The pipeline can look like this:

Taxpayer → City → selected nonprofit → another private organization

And potentially:

Taxpayer → City → nonprofit → contractor or supplier

At each step, the question becomes:

What rules follow the money?

Oversight Exists — But It Isn't the Same as Competition

Jacksonville's legislation frequently assigns oversight to the City's Grants and Contract Compliance Division or another City department.

That's meaningful.

For example, SPAR's Springfield Cleanup Corps agreement is overseen by Grants and Contract Compliance, and its funding agreement specifies program budgets and reporting obligations.

JRA's agreement is overseen by the Parks, Recreation and Community Services Department.

But oversight and procurement answer different questions.

Oversight asks:

Did the organization spend the money on the approved purpose?

Did it provide the required service?

Did it submit reports?

Did it comply with its grant agreement?

Competitive procurement asks something else:

Who had the opportunity to perform the work in the first place?

Was the marketplace tested?

Were other qualified providers considered?

Was price compared?

And when a nonprofit subsequently hires a contractor, who decides which contractor gets the business?

Those questions become increasingly important as nonprofits assume roles that look less like traditional charitable grants and more like ongoing public-service delivery.

JRA Illustrates Why the Distinction Matters

The Jacksonville Riverfront Alliance provides an unusually clear example.

The City directly selected JRA for a potentially 10-year relationship involving operation, maintenance and programming of downtown riverfront parks.

The final legislation appropriated $570,159 directly to JRA, plus another $1 million for downtown park maintenance, and expressly waived Section 118.107 to permit the direct agreement.

As we reported in Part 1, JRA Vice Chairman Mike Zaffaroni owns Liberty Landscape Supply, an established City landscaping contractor.

There is presently no evidence that Liberty has received work through JRA.

But if JRA eventually purchases landscaping services, irrigation work, plant material or other maintenance services from private companies, the unanswered question is what competitive process governs those purchases.

That's why this series is not ultimately about one nonprofit or one landscaping company.

JRA simply makes the structural question easy to see.

There Are Good Reasons to Use Nonprofits

Jacksonville shouldn't necessarily perform every service internally.

Consider homelessness.

Organizations such as Sulzbacher already possess facilities, staff and specialized knowledge that City government would have to recreate at significant cost.

Consider children's programs.

Kids Hope Alliance relies heavily on community providers because those organizations already operate within neighborhoods and populations KHA is trying to reach.

Consider healthcare.

Jacksonville's safety-net programs rely on established nonprofit clinics rather than expecting City Hall to operate medical facilities itself.

And federal housing and community-development programs routinely use nonprofit subrecipients selected through application processes. The City's Housing and Community Development Division requires nonprofit applicants to participate in a formal application and technical-assistance process.

The question isn't whether nonprofits belong in government service delivery.

They clearly do.

The question is what accountability structure accompanies the money.

Competitive Programs Demonstrate That Another Model Exists

That's what makes the Public Service Grant program useful as a comparison.

Jacksonville already knows how to create a competitive nonprofit funding process.

For FY 2024-25 and FY 2025-26, the City set aside $7.2 million annually for Public Service Grants. Organizations compete, applications are scored and grant awards are subject to City oversight.

That doesn't mean every City grant should go through PSG.

Different programs require different structures.

But it demonstrates that Jacksonville recognizes an important principle:

Nonprofits can compete for public funding just as private contractors compete for public contracts.

So when Council decides not to use competition, the public deserves to understand why.

And when the recipient subsequently distributes public money to someone else, the public deserves to understand how that decision is made too.

The Pipeline Can Become Difficult to See

This may ultimately be the biggest transparency challenge.

When Jacksonville hires a company directly, residents can usually identify the City solicitation, the successful bidder and the contract amount.

When Jacksonville awards money competitively through Public Service Grants, there is an identifiable application and evaluation process.

But as public money moves through additional private organizations, the transaction can become harder for an ordinary taxpayer—or a competing business—to follow.

Did a subcontractor compete?

How many bids were received?

Who evaluated them?

Was a board member associated with one of the bidders?

Was that relationship disclosed?

Was the contract subsequently renewed?

Was its price ever tested against the market again?

Those aren't accusations of misconduct.

They're questions about visibility.

The farther the taxpayer dollar travels from City Hall, the easier it can become for the public to lose sight of how the final spending decision was made.

And There Is Another Stakeholder: Competing Businesses

This isn't only about taxpayers.

Public money creates business opportunities.

Jacksonville has thousands of businesses providing construction, landscaping, technology, food service, professional consulting, maintenance and other services nonprofits may need.

If the City procures a service directly, many of those companies have an established mechanism for learning about the opportunity and competing.

If a City-funded nonprofit procures the same service privately, do they have the same opportunity?

Maybe they do.

Maybe the nonprofit solicits multiple proposals and maintains rigorous conflict rules.

But unless those requirements are visible, businesses on the outside may never know the work existed.

That's why transparency protects two groups simultaneously.

It helps taxpayers understand where their money went.

And it helps qualified businesses know they had a fair opportunity to compete for it.

The Question Isn't Whether Jacksonville Should Fund Nonprofits

It should, when nonprofits can effectively serve a legitimate public purpose.

Nor does direct contracting automatically mean taxpayers are receiving poor value.

A directly selected nonprofit may be the most capable organization available.

But public procurement isn't simply about reaching the right result.

It's also about demonstrating how the result was reached.

Jacksonville is already moving tens of millions of dollars through nonprofit organizations every year.

Some funding is competitively awarded.

Some is directly appropriated.

Some nonprofits perform the work themselves.

Others pass portions of City money onward through re-grants or contracts.

That creates a public-money pipeline that is larger and more complicated than any single budget line can show.

And it leads directly to the next question in this series:

Once Jacksonville writes the nonprofit check, who ultimately gets the money?

Clears: Do Jacksonville's Procurement Rules Follow the Money?

The Public Money Pipeline Part IV

The Public Money Pipeline Part III

The Public Money Pipeline Part II

The Public Money Pipeline Part I