What is a categorical grant?

A categorical grant is a type of grant funding provided by the federal government to state and local governments, as well as non-profit organizations, for specific purposes or projects.

Categorical grants are usually restricted to a particular area, such as education, transportation, or healthcare. The funds must be used for the specific purpose outlined in the grant agreement and cannot be allocated for other purposes.

These grants typically have strict guidelines and requirements that must be met in order to receive and continue funding. They may also require matching funds from the receiving entity, ensuring a level of commitment and investment in the project.

Categorical grants can be beneficial as they provide targeted funding for important programs and initiatives, but can also be restrictive in terms of flexibility and autonomy for the recipient.