The Federal Government issues a number of different grants for different purposes. They have been simply classified into Mandatory Grants and Discretionary Grants according to the criteria under which they are distributed.

MANDATORY GRANTS: The Federal Government are obligated to issue Mandatory Grants of a fixed amount to such institutions that demonstrate eligibility for the same based on a stringent set of prerequisites. There is thus no competition for this type of grant as anyone meeting the set criteria is issued with a Mandatory Grant upon submitting an application for it.

There is a specific formula to calculate the amount awarded which is the product of a particular sum of money and an indexed variable which depends on a variety of factors like total income, number of members in the community, etc. For example, a Mandatory Grant may be issued to a state to provide certain facilities for disabled citizens who have shown proven disability by heath certificates. Mandatory Grants may be open- or close- ended or Block grants.

Block Grant: A Block Grant are issued to carry out a certain category or group of functions. Within that category, the receivers of the grant may exercise their discretion and choose what they wish to use the grant for. Thus, a Block Grant is less stringent and provides more options and adaptability than other types of mandatory grants. It is usually issued to the State Governments.

Open Ended Grant: Open ended grants are also called “Open Ended Entitlement Grants.” They do not have a maximum amount limit. For example, an Open Ended Grant may specify a certain percentage of the total amount that a state pays towards a certain cause. If a state pays funs to a citizen, a proportion of the amount paid may be covered by the Open Ended Grant.

Close Ended Grant: Close Ended Grants are of a fixed sum of money and have a maximum amount limit, thus the term “close ended.”

DISCRETIONARY GRANTS: Discretionary Grants may be issued at the discretion of the Congress for different projects that it may decide upon. As there is no obligation for the Federal Government to issue them, there is competition between applicants for this type of grant. Each applying agency submits proposal for their project to the Federal Government which then selects who to award the grant to. This is why discretionary grants are also called “Project grants.” The amount for the grant is then negotiated by the awarders and awardees or calculated by a specified formula and a cooperative agreement is signed. Every year, the Federal Government elects to award discretionary grants that they select by a competitive selection process for a variety of projects.

Some of the types of these projects are enumerated below:

Conference Projects: The Federal Government supports workshops, seminars and symposiums to promote the dissemination and progress of knowledge and learning in the fields of scientific technology and healthcare. A conference refers to any formal and organized gathering of individuals with a specific agenda for discussion, consultation, or exchange of views about a particular topic of information.

Construction Projects: The Government undertakes to fund certain building and renovation projects.

Demonstrative Projects: The Federal Government may issue a discretionary grant to an agency that demonstrates a new procedure, product, service or mode of delivering a product.

Research Projects: Research projects are funded to further knowledge and for systematic investigation using existing data by applying scientific methods to acquire new, relevant and useful information.

Service Related Projects: Funds may be issued for the provision or regulation of various services and utilities including their setup, initiation, modification and delivery.

Training Projects: Educational grants and financial aid are provided by the Government in the form of scholarships and fellowships, usually requiring an obligatory return service in the awarding institution for a fixed period of time. These funds are awarded to needy and deserving individuals in fields that are considered to be useful to the body awarding the funds.

Funds may also be granted to educational and learning institutions to better the services they offer.

For detailed information on Federal Government Grants, visit FederalGrantsTips.com