Government
grants funding is a highly confusing process, involving federal
budgets, departments, government initiatives, and transfers. Wading
through this process can be extremely confusing, and many people
give up before they've even broken the surface of the grant process.
This is a shame.
The US government
has been criticized by many who feel the government grant funding
process is far too confusing to be of actual benefit to the average
citizen. Although the government has been making progress in this
regard, it remains very difficult to make such a complex system
understandable to the average person.
How
Government grants work
Typically, government grants start with
the Federal government.
Every year, billions of dollars are allocated through the budget to
Federal grant initiatives. This money is then distributed to the
various Federal government departments, which then clarify and
solidify their unique initiatives and targets for funding.
From
there, most grant funding is then directed down to the State
government level. These funds are termed either mandatory and
discretionary grant funds. Generally speaking, State governments
then implement mandatory programs within their state, and target
more state and local level needs using discretionary funds.
Tracing this funding can be difficult.
For example, the Low Income Energy Assistance Program (LIHEAP) is a
program that is funded federally and provides a one time cash
payment to help eligible families pay their heating (or cooling)
bills. However, this cash is not provided to the individual directly
from the Federal government. Although the federal department of the
Administration of Children and Families' Division of Energy
Assistance in the Office of Community Services administers this
program at the federal level, the actual cash is given to State
governments to whom individuals apply. Other initiatives that
involve discretionary funding can be administered differently in
each State, meaning that an individual must track down the program
name and funding that their state of residence uses to administer
the grant initiative.
At the federal level,
grant programs and funding are provided through 7 financial types of
assistance and 8 non-financial types of assistance.
1) Direct Payments for Specified Use
Funds from the Federal government that
are given directly to individuals, or private firms and
institutions. These payments are then directed to a specified goal
or activity, with performance assessments built in.
2) Direct Payments with Unrestricted
Use
These funds are directly provided to
individuals who satisfy preexisting eligibility requirements. The
recipients may spend these funds any way they wish. These funds
include pension, retirement and compensation plans.
3) Formula Grants
Allocations of funds to States (or
subdivisions) in accordance with legally or administratively
prescribed distribution formulas. These are for programs of a
continual nature but not necessarily directed to a specific project.
4) Project Grants
Allocations of funds for fixed periods
of time for specific projects. Examples include scholarships,
research grants, evaluation grants, construction grants, and others.
5) Guaranteed/Insured Loans
These loan programs offer protection by
the Federal government for lenders who may suffer loan defaults by
borrowers.
6) Direct Loans
These are loans provided through
Federal dollars for a set period of time. These loans may or may not
require interest payments, but are expected to be repaid.
7) Insurance
This type of financial assistance can
be provided by the Federal government or private carriers. It is
provided as reimbursement for losses experienced under specific
conditions, and may or may not require payments of premiums.
Non-financial types of assistance include:
Sale, Exchange, or Donation of Property
and Goods; Use of Property, Facilities, and Equipment Programs;
Provision of Specialized Services Programs; Advisory Services and
Counseling Programs; Dissemination of Technical Information
Programs; Training Programs; Investigation of Complaints; and
Federal Employment Programs.
Read more about the
federal
government grants process and how grant money flows to your
State. Understand how mandatory and discretionary funding allocation
directs u s government grants.
Discover how to find
your Government Grants today with the
Able Grants
Internet Guide.
Grants Menu:
Government Grants
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