A lot of people go gaga over the whole concept of free federal grants. The moot point is, is it really free? If you were to read Jay M. Shafritz's book ‘American Government and Politics', he defines what a grant is. A grant, he says, is a gift that has certain obligations for the grantee and expectations from the grantor. A grant is no one-way street as most people looking for grants would like to believe. A grant comes to you inbuilt with the word ‘obligations'. And rightly so, wouldn't you say? Why on earth should someone give you a lot of money and then forget about it? A grant is not philanthropy pure and simple. It means you have a responsibility to fulfill certain obligations.

Why are free federal grants given? They are basically dispensed so that organizations that are involved in doing work that benefits the community have the money to carry out the work. For example, the projects could be programs that train displaced workers, or street paving projects or water conservation projects or anything for the good of the community or the society. Once a grant has been sanctioned, the organization has to make sure that their functioning has certain strict performance standards. There has to be detailed and transparent auditing and accounting and the auditing has to be done once a year at least.

The other thing about free federal grants is that every cent has got to be spent. If there is any money that is left over after the project is complete, it reverts to the Treasury. The deal is that every cent should be accounted for. The goals that are set out in the program when the grant is applied for must be followed exactly as they are specified. If there are any changes in the course of the period, they must go through government procedures and get an approval. Of course it goes without saying that time schedules must be adhered to and the project must be successfully completed.

What happens if the organization does not comply with the program goals? Then, it is likely that the ‘grantee' or the one who gets the free federal grant will have to pay a penalty. What form do these penalties take? This is said to be non-compliance and the penalties could range from economic sanctions to maybe even a prison term if it is suspected and proved that there was intentional misuse or theft of the grant money.

Who do most of the free federal grants go to? Most of the beneficiaries of this grant money are universities, colleges, states, cities, federal agencies and research organizations. The application process is done by experts who are well-versed in this. Which is why individuals usually do not qualify for them. Most organizations have special staff or get expertise from outside to prepare the applications and to monitor and administer the grants. It takes a lot of expense and time to just apply for a free federal grant. It also involves a great deal of legwork and going to and fro till it is finally approved. With so many cutbacks on federal spending, the chances of the grant being approved could be slim. The truth is that free federal grants are no cakewalk. They come with a price tag attached. The organization that gets it has to be prepared to deliver and deliver well.