The Strange Language of Federal Grants


Federal assistance can take the form of money, property, services, or pretty much anything of value that’s awarded to a recipient to support a public purpose. If you’ve ever applied for federal money, you know that the process can be a little “involved.” In addition to the variety of forms and documentation required with most application packages, you’re faced with common terms whose meanings aren’t exactly intuitive. Top that off with the fact that each federal department typically uses a different online system to manage its awards, and the idea of applying can be downright intimidating. This blog entry aims to make that prospect a little less daunting.

Basic Federal Grants Terms

Let’s start with the basics and clarify some of the most fundamental terms in the dictionary of federal financial assistance.

  • Grant–an award of financial assistance designed to support or stimulate a public purpose when substantial involvement by the federal government is not anticipated.
  • Cooperative Agreement–an award of financial assistance designed to support or stimulate a public purpose when substantial involvement by the federal government is anticipated.
  • Contract–an award made when the main purpose is to acquire goods or services for the federal government’s own use.

Substantial Federal Involvement

Substantial federal involvement, which distinguishes a cooperative agreement from a grant, is a somewhat subjective concept that the federal government explains in each funding announcement. Usually the funding agency will suggest ways that they could be substantially involved, but ultimately the applicant has flexibility in suggesting federal roles and responsibilities within their proposal. So think of a cooperative agreement as a sort of partnership in which the federal agency might provide technical assistance, project steering, or other meaningful input during the life of the award. Most awards made through NOAA’s National Coastal Zone Management Program and National Estuarine Research Reserve System are structured as cooperative agreements because NOAA staff provide recipients with ongoing technical assistance and access to NOAA resources.

With grants, on the other hand, communication between the awarding agency and the recipient is usually less frequent and more focused on routine matters. NOAA’s Coastal and Estuarine Land Conservation Program awards are structured as grants because applicants propose to acquire specific parcels of land for conservation purposes, with no need for NOAA involvement aside from the cash.

Federal Contracts

Although technically considered financial assistance, contracts are very different from grants and cooperative agreements. Contracts are used when the government is meeting its own needs for goods or services, such as office supplies or janitorial services. The rules applying to federal contracts, known as the Federal Acquisition Regulation (FAR), are much more detailed and lengthy than those surrounding grants, which are covered in Title 2, Part 200 of the Code of Federal Regulations.

This is obviously just the tip of the iceberg, but it’s a very big and potentially helpful iceberg, so comment if you’d like me to continue exploring the world of federal grants.