Categorical grants refer to money given for a specific purpose that comes with. Congress in 1994 changed many federal grants into block grants.
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categorical grants
Grants in aid are grants to states to achieve a public project or service. Categorical grants are grants that are given to states for a SPECIFIC PURPOSE. Block grants are given to states for a GENERAL purpose.
Ronald Reagan
State and local governments often prefer categorical grants because they provide specific funding for designated programs or purposes, which can help ensure that resources are used for particular needs. However, categorical grants come with more restrictions and requirements compared to block grants, which offer greater flexibility in how funds can be utilized. The preference can vary based on the specific needs and priorities of the government in question; some may favor the autonomy provided by block grants. Ultimately, the choice between the two types of grants depends on the context and intended use of the funds.
Grants in aid are grants to states to achieve a public project or service. Categorical grants are grants that are given to states for a SPECIFIC PURPOSE. Block grants are given to states for a GENERAL purpose.
Project and formula
Categorical-formula grants
An example would be Head Start or the Food Stamp program.
Categorical grants are the main source of federal aid to state and local government, can be used only for specific purposes and for helping education or categories of state and local spending.Categorical grants are distributed either on a formula basis or a project basis. For project grants, states compete for funding; the federal government selects specific projects based on merit. Formula grants, on the other hand, are distributed based on a standardized formula set by Congress.During the development of the Interstate Highway System, congressional grants provided roughly 90% of the funding. Categorical grants may be spent only for narrowly defined purposes and 33% of categorical grants are considered to be formula grants. Examples of categorical grants include Head Start, the Food Stamp Program, and Medicaid.
money givin to states for a specific purpose