What is Categorical Grants – Today in this article we are going to discuss Categorical Grants. The United States Federal System is offering categorical grants, under the system the federal government holds power in some areas that includes military spending. Whereas the state and local government hold power in other purposes like law enforcement, roads and schools. However, the federal government can also have high influence on those areas that lie under the domain of local government. The federal government also uses the money to convince the states to collaborate and meet the national targets. Therefore the categorical grants play a vital role in meeting the national targets that are set by the federal government. Proceed further to know more about Categorical Grants.
Highlights of this Post
What Are Categorical Grants?
Categorical grants are the types of grants that are provided to the state government by the federal government. The grant is offered to the state government for a specific purpose or a semi-public purpose. But remember that the categorical grants implies that the money can only be obtained by the state or local government if they followed certain rules and regulations set by the federal government
Categorical grants can be said to be the result of the United States Federal System. The congress system has given the federal government power in some specific areas and one of them is military spending. The state and local government will have power over other areas that are law enforcement, roads and schools. The federal government also has the right to influence those areas that are under local governments. The federal government mainly aims to reach the national targets by collaborating with the state and local governments.
The Development of Categorical Grants (1862-1975)
Categorical Grants Federal Government System
As you know, the US Constitution has granted certain power to the federal government and also reserved other available powers to the individual state government. It is mainly done to ensure that the federal government does not suppress other individual state governments. It also restricts the federal government from being dominative and powerful. The Congress has also designed programs to help out the people but the problem is that they do not have the power to implement such programs at the national level.
The congress might decide that it is mandatory to use seat belts to prevent injuries, deaths and medical bills. But they will be unable to pass federal law making seat belts mandatory nationally. However, it was decades ago that all the requirements for seat belts lie with the state government. Therefore Congress has created a program that offers incentives to every state so that they can easily adopt that particular program. The incentives are generally offered in the form of cash grants. It can be a really good example of categorical grants as it helps in understanding how collaborative federalism is practiced. Another example of categorical grants is when the federal government offers money to the state to implement the seat belt program. But there are certain requirements and guidelines that must be met by the state.
The federal government is also planning to make roaches safer so that Americans can use them. The federal government can work on that without leaving the authority of the individual states. So, Categorical grants are one of the most common types of grants that are awarded to the local and state governments. But remember that there is not only one type of federal funding, there are also other types of federal grant funding.
Early Categorical Grants
The Morrill Act of 1862 helps to trace the development of categorical federal aid. It was granted by Congress that each state will be getting a portion of public property that is sold by them and it can be used to support colleges. It was known as the “Land Grant Colleges” and everything was stated under this particular law. However, these grants are by no means the first to be affirmed by the state.
However, there are also previous examples that included the pre-constitution period and there were scholarships that had offered support to education. The main aim of the Morrill Act was to support the states to train young people with agricultural and machine classes. It was basically for engineers and for the farmers. There was also a requirement : the colleges that are supported in this way must also give military instruction.
It is also important for the states to invest the principal from the land sales to provide construction, approved securities and also submit an annual report to the Congress. So, these were some of the basic elements in the categorical aid. The necessary funds were provided and exchanged for the acceptance of certain national minimum standards for a particular purpose.
4 Types of Federal Funding in The US
As you already know that the federal government offers various types of financial support to states, non-states and other organizations. The main aim of providing the grants is to support the program to benefit the public. But remember the purpose of the loan is not intended for loans to individuals or for federal aid.
Apart from that you cannot use these grants to acquire contractual services to acquire properly that can directly benefit the federal government. It is seen that the federal authorities run more than a thousand funding programs every year. Each of the programs must fall into a few separate categories that has been listed below:
Formula Grant Funding
The formula grants are mainly used for the ongoing programs that service only a specific group of people consisting of low income students and children with disabilities. However, they do not follow any competitive selection procedure for funding. But it is mainly based on some general criteria like the population size and other census criteria.
The agencies that have met the eligibility requirements will be reciting the funds within the framework of the formula that is set for funding procedure. There is an example of formula grant funding of the U.S Department of Health and Human Services also known as DHHS in short. They are a part of the Nutrition Services Incentive Program. The program has been mainly designed to offer grants to promote the delivery of nutritious meals to the elderly people in a particular area.
The formula that is used to determine the grant amount for every applicant is based on the number of meals that are served to the elderly every year in comparison to other states and regions. So, the DHHS system is followed and $0.50 per meal was calculated according to the reports.
Project Grant Funding
Project Grant Funding mainly aims to subsidize some particular services for a period of time. Once the grant is approved the funding agency directly accepts the applications from those organizations that have qualified and they can apply for the total funding. But when the application period expires, the agency will be evaluating the application of every individual and then awarding the grants to those individuals that meet the eligibility requirements.
An example of the project grant funding is the operation carried by the U.S Department of Justice and the Mental Health Collaboration Program. The program mainly provides grants to the states, local government and other organizations.
The program mainly aims to improve and access mental health services for the criminals who are suffering from illness. After that the applicant agency offers a statement on how the project will be carried on and meet the objectives set by the program. About 20 to 30 applicants are chosen for the scholarship who scored the highest marks.
Categorical Scholarship Grants Funding
The definition of Categorical grant is that it is a type of grant that is designed for the government institutions and agencies. This grant has a very special purpose to serve. However, to receive the categorical scholarship the application needs to meet the eligibility requirements. Some examples of the categorical grant funding are Asbestos Removal Programs, Forestry Assistance Programs, Magnet School Programs, and Head Start Programs. Categorical scholarship are mainly awarded by following two ways:’
Project Grants
These are competitive grants that are proposed by the local government to attract government funding. They do not distribute money according to the formula. One example of project funding was the Ministry of Education’s Race to the Top. In that particular program, the state competes for educational money to make changes in the education system.
The changes eliminated a number of charter schools and also adopted Common Core Standards. It also aims to improve the underperforming schools. Many states have competed to get the money but the funds were only provided to those states that have won the competition.
Formula Grants
The total funding highly depended on the congress where they wanted to spend it. After that the money is distributed in all the states following the formula. For example, food stamps are a national program that is offered to the low income people so that they can get free food. The national government had spent over $75 billion on providing grocery stamps annually.
However, there are some states that have impoverished in comparison to the other states. The formula is used in distributing the grants to the states. It can be possible that some states might be receiving more funds in comparison to the others.
Difference Between Block Grants Vs Categorical Grants
A careful examination has been done on block scholarship and categorical scholarship to find out their differences and similarities. The Categorical grants are federal grants that are offered to the startle and other local governments so that they can collaborate for a particular purpose and program.
The block grants are more flexible in comparison to the categorical grants. But the categorical grants are very specific and more competitive. However, specific restrictions are imposed on the categorical grant whereas the block grants do not have many restrictions. The block grants are mainly offered to the local government whereas the categorical grants are offered to the state and municipality.
How do categorical grants increases federal power
The national government has played a big role in influencing and encouraging the states to administer the federal policies. The grants by the federal government is used to promote cooperation between the states and also for proper implementation of federal policies.
In the second half of the 20th century it has been identified an increase of expenditure on the categorical aids. Therefore it is seen that the role of the nation government in the federal balance is increasing rapidly.
The categorical grant programs have been set by the political actors in the national government that have helped in improving flexibility and discretion of the state governments.
The Politics Of Categorical Grants in Aid
When the Republicans took over the presidency after Congress in 1994 a treaty with America was handed over to control all the federal programs run by the states. It was mainly done to replace the categorical scholarship programs with the block funding programs. Two examples of crime policy and social reform has been stated below:
Decentralization of Crime Policy
After the Congress were defeated, The Republicans can change some of the specific programs and grants for state and local government. These sets of programs were under Clinton’s administration crime law with block grants to the states. This particular way has helped them to find crime on their own discretion.
Decentralization in Welfare Reform
The Republicans have also changed the state welfare program “Aid to Families With Dependent Children ” (ADFC) with “ Temporary Assistance for Needy Families “also known as TANF. It has helped the stated government block grants to reform their own welfare systems.
Conclusion
I hope the article has provided you with all the necessary information about Categorical Grants. So, you can clearly see that categorical aid is one of the main sources of federal government aid that is offered to state and local governments. The grants are awarded for a specific purpose and it can be only used for that particular purpose. As we have already learned in the article that it is not mandatory for the states to accept a categorical grant. But when they need a categorical grant they need to follow the rules and regulations to withdraw funds. We have also noticed the fundamental differences between block grant and categorical grants. Thanks for reading this article. I hope you have a great day ahead! If you are looking for information about grants for felons please check this article 10 grants for felons.
Frequently Asked Question
We are going to answer some of the most frequently asked questions on Categorical Grants. Go through the questions and answer to gain additional knowledge.
What do you mean by Categorical Grants?
Categorical grants are the types of grants that are provided to the state government by the federal government. The grant is offered to the state government for a specific purpose or a semi-public purpose.
Is it mandatory for the states to accept Categorical Grants?
No, it is not mandatory for the states to accept Categorical Grants. But if they need Categorical grants then they need to abide by the rules and regulations.
What is the difference between block grants and categorical grants?
The block grants are more flexible in comparison to the categorical grants. But the categorical grants are very specific and more competitive.
