The American government has issued grants to entrepreneurs for over 50 years. But do all entrepreneurs know what a grant is, how to qualify for one, and the kind of grants they can get? Most of them do not!
Government grants can be defined as money given to entrepreneurs, not as entitlements or benefits that are not supposed to be paid back. Grants are given to businesses that have a goal of supporting a certain public course.
They provide a way for the government to help entrepreneurs in different parts of the country invest in certain parts of the US economy. This might be the education sector, the health industry, or even the development of infrastructure and public facilities.
Entrepreneurs are not supposed to use grants as a source of funding to buy things like property or invest in areas for personal benefit.
Who and When are Grants Appropriated?
Congress appropriates grant funding every year. You will find all the programs on the Federal Register and the Catalog of Domestic Federal Assistance (CDFA).
You will also find information on things like the program title and summary, administrative contact, application deadline, total budget, and the government department sponsoring the grant.
Different agencies in the cabinet administer the grants. They might include the departments of Homeland Security, Transportation, Education, Health, and Housing and Urban development.
Who Qualifies for a Grant?
A bigger percentage of funding for entrepreneurs is given to different government organizations from the local to the state level, academia, and nonprofit organizations. Education providers in the private and public sectors are eligible as well as research institutions and independent educational systems.
Securing a government grant as an individual is a challenge, though very much possible. However, if you are running a business that helps the general public in one way or another, you stand a greater chance of success compared to those who do not.
You also stand a greater chance of being successful if you seek to fill a void that is not being filled by anyone else. Nonprofits that seek to advance the government agenda can also be awarded grants easily.
How To Apply for a Grant
Some people think that a government grant is free money coming their way. However, it is important to note that applying for a grant and being successful is a complex process that needs expertise and a lot of time.
You also need to make commitments to ensure that you will fulfill a set of obligations for you to get the money. If you fail to meet all the obligations on schedule, you might find yourself with legal penalties.
However, this does not mean that government grants have a maturity date. The government needs to make sure that it gets something useful done with the money, or rather ROI (Return on Investment).
When applying for a grant, start by reviewing the CDFA. Here, you will get all the information you need especially on the application process and how you can use the money. You will also learn about performance and reporting requirements for all the listed programs.
You can also start by contacting the government department sponsoring the specific grant you want to apply for. They will answer all your questions and direct you on what you need to do.
Different Types of Grants
The main objective of grants is to enhance projects and programs that benefit the public. This can happen immediately or over some time. Examples of programs that succeed easily with government grants include retraining programs for people looking for jobs, programs that attract the development of depressed sections, and local infrastructure projects.
Government grants cover different sectors. These might include disaster prevention, consumer protection, training and employment, cultural affairs, legal services, education, social services, commerce and business, community and regional development, housing, natural resources, environment, food, agriculture, health, transportation, energy, technology, and science.
In conclusion, a grant is not like a loan. You will not have to pay it back. It is like a gift with no tax implications or interest. If you are running a business that meets all the requirements discussed above and needs huge amounts of money, then you can opt for a grant. You can even apply for multiple grants in a year to increase your chances of success.