3.3

Study Notes

Federal grants have evolved over time, starting with land grants in the Articles of Confederation
Intergovernmental grants are financial incentives for states to achieve national goals
Grants are often likened to a "carrot" incentivizing actions
Unfunded mandates are federal requirements with little or no compensation for the implementing costs. These are likened to "sticks" due to their coercive nature
In the early 1800s, land grants were the primary way the federal government supported states, funding infrastructure projects, such as roads, canals, and railroads
Land grants supported the creation of numerous universities across the country (land-grant institutions), including Oklahoma State University and the University of Delaware
Cash grants replaced land grants as the chief form of federal intergovernmental transfer in the 20th century
Federal cash grants come with strings attached, ensuring public funds are used for national objectives (Categorical grants)
Categorical grants have stringent administrative criteria and often require matching funds. Examples include Medicaid and food stamp programs

Categorical Grants: These grants have strict administrative criteria and limited the use of grant funds. Examples include Medicaid and food stamp program. Often require matching funds as well
Block Grants: Grants with less stringent federal administrative conditions that provide recipients more flexibility in how funds are spent. Examples include Workforce Investment Act. and the Surface Transportation program
General Revenue Sharing: Least restricted grants, allowing recipients to use funds based on local needs.

Federal grants grew significantly in the 1960s and 1970s
The increase of grants in the 1990s and 2000s was primarily due to the increase in money going to Medicaid
Health care related programs are a large portion of federal grant expenses in 2014

Categorical grants are favored by the federal government to transfer funds to states because they have greater control, often tied to projects or outcomes
Block grants are an alternative with greater flexibility
The terrorist attacks of September 11, 2001 motivated increased federal grant programs related to homeland security but few were block grants
Categorical grants are more well-established and offer the benefit of federal supervision over implementation

Unfunded mandates are federal laws that compel state and local governments to comply with certain standards and carry out certain obligations without providing adequate financial support.
Mandate laws are often implemented in areas such as environmental protection, civil rights, education, and homeland security.
Cross-cutting mandates result in the suspension or reduction of federal grants if mandates are not met
Example: the Clean Air Act

The Real ID Act of 2005 set standards for driver’s licenses and state-issued identification cards, requiring these to have specific features and to follow set formats and security measures with significant costs to the states to implement
The Clery Act of 1990 mandated that universities and colleges reveal data about campus crime occurrences, influencing and raising security awareness on college campuses, and how they respond.