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The Tools of Government: Grants. David R. Beam & Timothy J. Conlan. Defining the Tool: Grants. Defining Features Stimulating or supporting Founded in land grants Primarily cash payment Directed toward other levels of government, nonprofit organizations, universities, or individuals

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the tools of government grants

The Tools of Government: Grants

David R. Beam & Timothy J. Conlan

defining the tool grants
Defining the Tool: Grants
  • Defining Features
    • Stimulating or supporting
    • Founded in land grants
    • Primarily cash payment
    • Directed toward other levels of government, nonprofit organizations, universities, or individuals
  • Relation to Key Tool Features
    • Directness: “The principle indirect tool”
    • Automaticity: High level due to reliance on other entities
    • Coerciveness: Generally non-coercive
    • Visibility: Fairly visible
defining the tools grants
Defining the Tools:Grants
  • Design Features and Major Variants
    • Scope of Purpose: Categorical Grants, Block Grants, and General Purpose Assistance
    • Method of Allocation: Formula (continuous, prescribed by law) & Project Grants (fixed period, specific project or service)
    • Degree of Federal or Donor Control: Application process and financial audits
    • Other Design Features: Recipient variation and “pass through grants”
patterns of grants use
Patterns of Grants Use
  • Current Extent
    • Most widely used policy tool of American Federal Government
    • 928 funded grant programs amoung the 1,412 federal assistance programs in 1999
  • Nonfederal Grants
    • Numerous grants from states to their localities
    • Grants and “pass through grants” generated from state receipts
    • In 1996, 30% of the $248 billion in state aid was pass-through federal funding
  • International Experience
    • Comparably the US relies more heavily on Categorical Grants
    • There has been an international shift to Block and General Grants
patterns of grant use
Patterns of Grant Use
  • Recent Trends in the United States
    • Grant Growth: Significant growth since mid-nineteenth century with bursts in the 1930’s, 1956, 1960’s and 1990’s
    • More Payments to Individuals: Nearly all growth has been in the form of individual payments such as Medicaid, welfare aid, and housing assistance
    • The Erosion Flexible Funding: While the number of block grants has increased the proportion of federal aid has not
    • Growing Mandates: Crosscutting requirements and crossover sanctions
    • Research Grant Trends: On the rise since WWII and it is an important component of external funding streams for institutional research and development
basic mechanics of grant in aid
Basic Mechanics of Grant In Aid
  • Authorization
    • Administering organization
    • Description of supported activities
    • Eligibility
    • Distribution of funds
  • Allocation: Application, Selection, and Awarding
    • Regulations
    • Marketing
    • Application
    • Application Review
    • Award Process
  • Post Award Management and Assessment
    • Program implementation
    • Monitoring and evaluation
tool selection theory and practice
Tool Selection: Theory and Practice
  • Rationale for the Use of Grants
    • Constitutional Considerations: Grants judged by federal government as appropriate tool for handling domestic functions
    • Administrative Rationales: Justified on basis of administrative efficiency
    • Economic Theory: The federal government possesses the strongest and “fairest” revenue source
  • Political Considerations
    • Effective way to bring states into federal programs
    • Addresses specific concerns of interest groups on federal level
    • Centralization of American Government
tool selection theory and practice1
Tool Selection: Theory and Practice
  • Systemic Concerns: Reducing Duplication and Confusion
    • Grant Consolidation: Categorical grants to block grants
    • Grant Simplification: Simplify and Standardize administrative procedures
    • Trade-off Proposals: 100% cost shift between state and federal level
  • Inefficient Allocation of Funds
    • Adherence to the “Robin Hood” tax system
  • Individual Program Concerns
    • Delays in Spending Funds: Money is not always spent
    • Improper Expenditure Funds: Money not spent where intended
    • Failure to Achieve Objective: Desired results are not always met
overall assessment
Overall Assessment
  • Legitimacy:High in political legitimacy
  • Effectiveness:Moderate- some programs are very effective while others are hard to gauge
  • Efficiency:Grants are poor in efficiencydue to the difficulty in tracking funds
  • Equity:The wide distribution rather than need based distribution leads to poor equity ratings
  • Accountability:There are many complexities leading to a poor rating
future directions
Future Directions
  • More of the Same:Expect that grants in the United States will continue to grow
  • Recurring Cycles of Growth and Reform:With expected growth there needs to be significant reform in terms of implementation, efficiency, and evaluation
  • Shift from Grants to Other Tools:There will be other domestic policy tools which will compete for dominance with grants