An Overview on Government Grants
Let’s start this off with the basics – the government grants are, in essence, a form of financial assistance offered by a federal agency with the purpose of covering the expenses of a project that has been previously approved. The key dissociation between government grants and other forms of financial assistance resides in the fact that the funds invested by the said agencies will not require reimbursement.
Furthermore, the grantee, which is basically the individual or the organization that has been approved for the financial aid, will not be required to repay any further taxes, fees or interest to the government grantor. However, this does not entail that the government is willing to throw money out the window for every applicant that comes up with a business idea or individual in need of a personal loan.
You might not be eligible for a government grant
As it has been indicated earlier, applying for a government grant for the purpose of purchasing a new home, automobile and so on is out of the question. The federal grants are not intended to help in supplementing an individual’s income, providing medical care or other similar situations.
In addition, the same thing goes for those in search of student loans. However, the good news is that people in these situations can always apply to the other appropriate government institutions in order to receive suitable financial aid.
Furthermore, although the issues with small businesses that apply for government grants are a bit more intricate, the general rule is that federal agencies will not offer start-up loans. Chiefly, the grants will be presented to an already established company that can meet the minimum requirements for its field of work.
For example, while in the mining industry, the minimal limit of employees would be five hundred, companies in the trade industries are only required a minimum of one hundred employees on the payroll.
Alternatively yearly, the revenues figures are employed to determine the minimum prerequisites for corporations in the agriculture, retail, heavy constructions or special trades the requirements are based on. The prerequisites for small business government grants as well as the exceptions to the general rules can be viewed on the SBA website.
The categories of organizations that are eligible for government grants
The governmental authorities, may they be state, local, city-based or for a special districts, can be awarded government grants for various projects. Furthermore, in the United States the Native American Tribal Governments are also recognized among the adequate grantees.
In addition, the educational organizations and learning facilities – whether private or public – can be awarded federal grants as well. The last two categories of grantees that can receive grants from the government in case the project is feasible and the application form is filled correctly are public housing and non-profit organizations.
It is important to mention that individuals that file a government grant application for a project could be awarded the funds for its completion. However, the list of federal grants for individuals is noticeably different and subjected to more limitations compared to the ones available for organizations. Therefore, a person that files a grant application on the behalf of an organization should ensure that this aspect is specified.
Steps in applying for government grants
In order for an individual or an organization to apply for government grants, the procedure entails following the correct steps which will be discussed below.
The first task implies registering the company, organization or individual on the grants.gov website. It is important to keep in mind that the general duration of processing the registration will vary between 3 days to 2 weeks, depending on the situation.
On a side note, correctly filling out the fields in the registration forms can greatly speed up the registration. Due to the overload of grant requests, the authorities have assigned different systems to process particular types of applications, so this is an essential point to remember when filling and submitting it.
Next, potential grantees will need to download a government grant application package, complete the requested fields and send it in. Although there is not much to do but wait until the federal agency has processed the application, its progress can be monitored.
Locating a grant application among the thousands of candidates is possible using the CFDA digit series, Funding Opportunity Number, Competition ID or the assigned tracking number. This allows grantees to learn whether their request is heading in the right direction or if all signs point towards rejection.
What are the responsibilities of the grantees?
The main condition in the grant agreement is that the beneficiary takes full responsibility in using the awarded funds for the purpose they were originally granted. The initial contract cannot be changed without notifying and obtaining the written consent of the grantor. Moreover, in case an amount exceeding ten percent of the total grant fund is used to finance an alternative part of the project, the same rule applies.
Until investing the funds of the award, the grantee will be required to store them in an interest account. The full value of the interest obtained from this action will also be used in supporting the project for which the grant was issued.
Furthermore, the grantee is not allowed to divulge any details of the project to the media or the public without the consent of the federal authority that has awarded the funding. In general, these statements will be thoroughly discussed and their final form will be released only once both parties agree. In addition, the grantor will monitor the activities of the grantee handling the project closely and will require frequent reports regarding the investments, progress and other expenditures.
Should the project prove to be unfeasible when put into practice or in case the grantee decides to discontinue it, prior written notification to the federal agency needs to be submitted. It is worth mentioning that in this situation the remaining funds will need to be reimbursed in full to the grantor. Failure to comply with these standards can result in substantial fines or other legal consequences.
Maximizing the chances of being awarded government grants
In order to be informed of all the available grant opportunities, applicants should acquire the CFDA, a catalogue that includes the current offers. This listing will also prove immensely helpful in selecting the right category for a certain project and verifying the eligibility requirements or checking out the application procedures.
In addition, the CFDA also comprises of paradigms of approved government grants, so potential grantees can attain a few pointers of the do’s and don’ts. At the same time, the contact details of authorities responsible for awarding different categories of grants are included in the CFDA, so clearing any misunderstandings regarding the procedures, terms and conditions or post assistance is fairly easy.
Before submitting the government grant application, it is advisable to work out all the potential bugs in the details. The final form of the project should be near perfection in order for a potential grantee to have a shot at impressing the selective jury that decides the fate of the funds. Moreover, since the deadline of each grant can be found in the CFDA, there is no excuse for missing the final date on which the request can be sent in.
Well as a good piece of advice, although organizations generally have specialized personnel to handle the grant requests, individuals or smaller companies should consider proposal writing courses or seminars in order to boost their chances of success.