Definition of Federal Grants

A highly sought-after commodity in modern times, free money in the form of a grant may fund simple projects such as a survey of the population numbers of various organisms in a small stream of water, to supporting major research laboratories seeking advancements in new technology. A myriad of public and private agencies disperse grants in the United States, with billions of taxpayer dollars funneled through agencies of the federal government.

Identification

The U.S. federal government stipulates that federal grants in particular "are not benefits or entitlements." However, grants, whether in the form of money, land, scholarships or tangible material are synonymous with gifts. A grant may be called an allowance, an award, a bequest, contribution, donation, endowment, gift, scholarship, stipend, subsidy or simply funding. Whatever the terminology used, a grant does not have to be repaid.

Function

The U.S. government through directives from the Congress provides funds to a number of federal agencies that in-turn disperse grants for various projects. Although the federal government stipulates that grants are not awarded directly to individuals, government agencies may award funding for projects that meet the particular agency's guidelines, which in turn supports the individuals involved and working on the project. For example, the National Endowment for the Arts awards grants that support artists and the Department of Education provides funding for a college education to many individuals through the Pell Grant Program.

Considerations

The Federal Financial Assistance Management Improvement Act of 1999, otherwise known as Public Law 106-107, was passed by the U.S. Congress to streamline and improve the means by which federal funds are awarded and dispersed through the hundreds of grant programs. A Grants Policy Committee was established to implement and oversee the legislation under the auspices of the Federal Chief Financial Officers Council.

Significance

In 2010, twenty-six major federal government agencies awarded grants including all the cabinet-level departments of the executive branch of government -- agriculture, commerce, defense, education, energy, health and human services, homeland security, housing and urban development, interior, justice, labor, state, transportation, treasury and veterans affairs.

Federal Grants to the States

Additionally, the federal government awards a huge number of grants to the states as well as municipal government agencies. Data collected and maintained by the U.S. Census Bureau shows that federal grants dispersed by the states range from funding extension services through the Department of Agriculture, economic development through the Department of Commerce, subsidizing emergency shelters through the Department of Housing and Urban Development, to sport fish restoration through the Department of the Interior's Fish and Wildlife Service agency.

References

• Grants.gov: What is a Grant?
• Grants.gov: Agencies that Provide Grants
• Federal Chief Financial Officers Council: About the Grants Policy Committee
• U.S. Census Bureau: Federal Aid to States for Fiscal Year 2009
• The White House: Federal Financial Accountability and Transparency Act of 2006
• U.S. Government Printing Office: Public Law 106-107 - Nov. 20, 1999