<P> In the United States, federal grants are economic aid issued by the United States government out of the general federal revenue . A federal grant is an award of financial assistance from a federal agency to a recipient to carry out a public purpose of support or stimulation authorized by a law of the United States . </P> <P> Grants are federal assistance to individuals, benefits or entitlements . A grant is not used to acquire property or services for the federal government's direct benefit . </P>

Federal monies provided to state and local governments for a narrowly defined purpose