Federal Grants

Several decades past, the U. S. Congress passed a bill allocating a specific percentage of all federal revenue collected be given back to its citizens in the form of federal government grant money to “support the public good of the United States”, and thus was born what we now call federal grant money. Also called federal funding opportunities, grants from the federal government are available in almost all areas to support the public good benefiting its citizenry. Here, we take a quick look at the history of federal grant money, who is eligible to apply and what the money can be used for.

The U. S. federal government actually began awarding federal government grants prior to the drafting of the U.S. Constitution. One of the first instances of use of federal government grant money was outlined in the Articles of Confederation and was used to purchase land. In order to expand and protect its interests, the federal government continuously provided financial aid to states and local governments to help deal with things like natural disasters, civil disturbances, westward expansion, and more. The federal grant system that we know today began to truly take form in the late 1800’s to early 1900’s.

During the Great Depression, the Roosevelt Administration worked with Congress to expand the federal grants-in-aid-system by instituting programs designed to provide social relief, financial reform, and bolster personal economic recovery. It was within this time period the massive interstate highways were constructed, thus providing hundreds of thousands of jobs for the unemployed nationwide using federal grant money.

Entities eligible to apply for and receive federal government grant money are grouped into six important categories:

  • State governments – to aide in the support of the state;
  • Local governments – to aide in the support of urbanization and infrastructure as well as assure public health and safety;
  • Territories and possessions – to assure national security;
  • Indian Tribal governments – to assist in land development, education and provide economic assistance;
  • Non-profit organizations and institutions – to help disseminate funds to address social disparities, and to;
  • Private individuals and business owners – to help assure public and private commerce.

As you can see, federal grants are available in all areas designed to provide for the greater good of the public.

The federal government allocates federal government grant money for use in four broad, but important categories:

  • Formula Grants – This type of federal grant assistance includes transportation and infrastructure development as designated by Congress. A good example is the Community Development Block Grant Program.
  • Project Grants – This type of grant supports funding of specific projects. Project grants can include fellowships, education scholarships, and research grants. The NIH and NSF are two of the largest arms of the federal government system offering these types of opportunities
  • Direct Payments for Specified Use – This type of federal grant supports payments made directly to individuals, private businesses, and private institutions.
  • Direct Payments with Unrestricted Use – This type of federal grant supports payments to beneficiaries who satisfy federal eligibility requirements in retirement, pensions and other programs within the federal employee pension system.

Even in harsh economic times, as mandated by law, the government still has federal funding opportunities available for those who qualify. It’s easy to become acquainted with the federal funding guideline process to research and apply for federal grant money.