The AI Opportunity in Grants Management

By Anand Trivedi, REI Systems’ AI Offering Lead and Munish Satia, Enterprise Architect, REI Systems

The landscape of federal grantmaking is vast and complex, with billions of dollars distributed annually to support critical initiatives across the nation. In fiscal year 2023 alone, the U.S. government awarded over $1 trillion in grants, underscoring the massive scale and importance of this process. However, with such enormous sums come significant challenges that federal agencies must navigate.

Currently, many agencies grapple with inefficiencies in grant processing, difficulties in ensuring compliance, and struggles to effectively evaluate program outcomes. These challenges can lead to delays in fund distribution, increased administrative burden, and potential misuse of resources. REI’s Grants Management Survey 2024 covering more than 15,000 grants management professionals indicated that on an average, a Grant Manager spent almost 36% of their time on administrative requirements monitoring. Moreover, the sheer volume of grant applications and the complexity of program requirements often overwhelm agency staff, making it difficult to provide timely and personalized support to applicants and grantees, ultimately resulting in increased Grantee burden This issue is further exacerbated due to the most significant challenge of retaining or attracting well-qualified grant management staff as cited by over 40% of the respondents in our survey.

This is where Artificial Intelligence (AI) emerges as a game-changing solution. By leveraging AI in grants management, federal agencies can dramatically improve program effectiveness, enhance process efficiency, and elevate customer experiences. Not only can AI enhance the overall quality of grant programs by enabling more informed decision-making, improving the targeting of resources, and facilitating better oversight, but also it can save millions of dollars by reducing administrative costs, minimizing errors, and identifying potential fraud or misuse of funds more effectively.

By embracing AI, federal agencies can transform their grantmaking processes from reactive to proactive, from manual to automated, and from siloed to integrated. This shift not only promises to streamline operations but also to maximize the service impact of every grant dollar spent, ultimately leading to more effective public services and better outcomes for communities across the nation.

AI Applications Across the Grants Lifecycle

The potential for AI to revolutionize grants management spans the entire lifecycle, from pre-award to post-award stages. Here are some use cases: (View PDF version here)

By implementing AI solutions across the grants lifecycle, federal agencies can enhance their grantmaking processes:

• Improved Staff Productivity: Automation of routine tasks through data analysis and pattern recognition allows employees to focus on high-value activities requiring human judgment and expertise.
• Enhanced Grantee Experience: Grantees benefit from a more streamlined, responsive, and personalized experience.
• Better Decision-Making: Agencies gain faster, more accurate insights to inform decision-making and policy development through AI-enabled grants arena landscaping.
• Risk Reduction: Predicting risks and detecting anomalies helps reduce waste and abuse, ensuring effective use of grant funds.

At HRSA, REI has leveraged its 20+ years of experience in building and maintaining Grants Management Systems and its expertise in AI to carefully identify 12 most impactful AI use cases across various steps of the Grants lifecycle such as planning, application, review, selection, award, post-award, and close-out. These cover integrating capabilities spanning across both traditional and generative AI and involve technical solutions ranging from semantic search, recommendation engines, chatbots, and intelligent RPA, among others. Structurally, these use cases have helped the agency deliver superior grantee experience, improve internal staff productivity, and enhanced data-driven decision-making.

Mitigating Risks in AI-Powered Grants Management

While AI offers substantial benefits in grants management, it’s crucial to address specific risks. At REI Systems, we stay ahead of these challenges and actively work to mitigate them through our responsible AI approach.

• Data Privacy and Security: We use robust encryption, access controls, and data anonymization techniques, along with FedRAMP-approved tools, to ensure security.
• Algorithmic Bias: We use diverse training data sets, regularly audit our models for bias, and implement fairness constraints in our algorithms to ensure ethical AI.
• Transparency and Explainability: We develop explainable AI models that provide clear rationales for their recommendations, ensuring accountability in government decision-making.
• Over-reliance on AI: Our AI systems are designed to augment, not replace, human decision-making, providing decision support tools that empower staff rather than dictate outcomes.
• Data Quality and Consistency: We ensure data quality and consistency through rigorous validation and cleansing processes and develop AI models that can handle data inconsistencies gracefully.
• Regulatory Compliance: We stay updated on emerging regulations and guidelines to ensure our AI solutions remain compliant with all relevant federal and agency-specific requirements.

By proactively addressing these risks, REI Systems ensures that our AI-powered grants management solutions deliver enhanced efficiency and effectiveness while maintaining the highest standards of fairness, transparency, and compliance. At HRSA, we are closely collaborating with the office of the CIO in enabling them to strengthen AI governance, building an agency specific AI risk management framework, and building systems and practices to adopt AI responsibly.

REI Systems: Leading the Way in AI-Powered Grants Management

At REI Systems, we lead in AI-driven transformation in grants management. Our expertise in federal grantmaking and cutting-edge AI capabilities allow us to develop tailored solutions for government agencies. We ensure our AI solutions fit seamlessly into existing workflows while driving meaningful improvements.

Our approach to AI implementation is value-focused and responsible (see figure 2 below). We identify the most low-hanging opportunities that balance value creation with feasibility and risk to deliver quick wins in diverse grants management contexts. Our solutions align with the principles of fairness, transparency, and ethical use of technology in government.

Figure 1: REI’s Mindful Approach to Leveraging AI for Grantmaking

As we move forward, REI Systems is committed to partnering with our federal clients to navigate the AI journey responsibly, ethically and effectively. We are actively developing and refining AI-powered features for our grants management systems, focusing on practical application and measurable impact. Our goal is to leverage AI to enhance the grantmaking process, improve outcomes for grantees and beneficiaries, and help our clients achieve their mission objectives more effectively. Some of Grants Management AI use cases we have developed or are actively working on include:

HRSA Post-award Grantee Risk Assessment: By leveraging single audit data and historical outcomes, such as drawdown restrictions, this proof-of-concept (PoC) predicts grantee risks using predictive analytics.

HRSA Electronic Handbooks (EHBs) Recommendation Engine: By analyzing logs and transactional data on the HRSA activity page, we provide next action recommendations to users based on user-based activities and reports to enhance user experience and streamline navigation.

GovGrants 3.0 Chatbot: We are integrating a comprehensive conversational AI agent or chatbot within GovGrants, our SaaS, Cloud-based, full life cycle grants management solution being used by several federal, state, and local agencies to manage grants worth more than $20B. This will significantly enhance the system user and grantee experience while fostering improved grants management efficiency.

By combining our deep domain knowledge in grants management with cutting-edge AI technologies, REI Systems is poised to help federal agencies unlock new levels of efficiency, insight, and impact in their grantmaking efforts. We invite our clients and partners to join us on this exciting journey as we work together to shape the future of grants management, harnessing the power of AI to create more effective, responsive, and impactful government programs.

Contact us at info@REIsystems.com to get started on your transformative AI journey.