Grants are an excellent way for organizations and nonprofits to secure essential funding to continue offering services and resources to audiences. Unlike loans, grants benefit many types of organizations because you won’t have to repay them. Many types of organizations provide comprehensive grants that can support various budgets. Understanding the different types of grants and where they come from can help your organization find the right funding for your needs.
Depending on your needs and eligibility, organizations can apply for various federal grant types. The four most common types of grants for federal funding can support many causes and proposals, allowing groups to receive the essential funding they need for their projects.
Also called discretionary funding, competitive grants require organizations to compete with other organizations for the same funds. Your organization will submit an application outlining your cause and budget, and the federal agency allocating funds will determine if you qualify and how much you will receive. While many regulations and factors will exist to help determine eligibility, organizations will have teams reviewing applications to make final calls.
When federal government agencies make these grants available, they will issue two types of documents to alert interested organizations — Notice of Funds Availability (NOFA) or Funding Opportunity Announcement (FOA). These notifications will outline the agency’s specific requirements for eligibility and applications, so you can determine if you fit their profile and have the resources and information to complete an application.
Examples of competitive grants include those for music and arts programs at schools. Institutions are not guaranteed funds, but the application allows them to plead their case and argue for the program’s benefits. After review, only a limited amount of schools will receive funding.
Formula grants are non-competitive funding, meaning all eligible organizations can receive some portion of funding. How well they match qualifications will determine how much money they receive. The formula created for this grant type will often include qualifier thresholds to help agencies allocate funds appropriately and fairly. The qualifiers might be factors such as:
Some common examples of this grant type include public projects, like public schooling and transportation. Various districts and localities qualify for this kind of program, but a big city with more people to serve would generally require more funding than smaller towns with a lower population density.
Pass-through grants outline the process by which organizations receive their money. The funds originally come from the federal government, but the government divvies those up to the state governments and gives them the power and authority to allocate funds from there.
State governments can use this grant type to support organizations, local governments and other state agencies through a competitive or formula grant system. The states also hold the power to determine how much organizations receive.
Continuation grants are for organizations that have already received federal funding and need more to complete the project. These are typically for long-term ventures that require several steps to complete. Other grants, like formula grants, automatically qualify as continuation grants so organizations can continue offering essential services to their audience.
When applying for this type of grant, you will have to show how you were able to perform with past funding. Data about your accomplishments and progress can prove you can responsibly use federal funds while showing you need more money.
Funding for these projects will also depend on available resources. While these grants are often non-competitive, limited funds might decrease how much organizations receive through continuation grants. Further, your organization must remain compliant and eligible to continue to receive funds. If you stop meeting thresholds or completing specific operations, you might no longer qualify for continuation funds.
Some examples of continuation grants include human services programs. These organizations often use continuation grants to support their annual endeavors and continue helping their communities. Using data like the number of individuals served and improvement rates can show there is a continuing need for the program to help organizations secure these grants.
While those were the four main types of federal grants, organizations and individuals can find other types of grant funding options provided by the government and other entities. While federal grants are often comprehensive and supportive, organizations can diversify their options with other grants.
Block grants are another type of federal funding specifically for state and local governments. These organizations and agencies can use block grants for more general improvement projects in their localities as long as projects fit the category of the received fund.
Block grants include general categories, like public health, law enforcement or social services. What local and state governments develop for these categories is up to them, but the money received from these funds must go to something under the designated purpose. This system allows states and local governments more flexibility and control over their projects to help their local communities and populations while still meeting some requirements and qualifications set by the federal government.
Research labs and higher education institutions require funding to complete essential research that advances innovation and technology. Organizations can apply to federal, state and private research grants to help them afford new equipment, teams and assistants, access and subscriptions to journals, conference fees and more. These grants are often competitive, requiring researchers and teams to argue for their project’s necessity and relevance.
Some research organizations will offer grants for various subjects, allowing more organizations to find the funding they need for their lab. While science is a common subject for grants and funding, social science, education, technology and business can find grants that support research ventures in these fields. Organizations might even fund undergraduate and graduate research, offering opportunities for students to contribute to discoveries and innovation.
Private grants are like other types, but they come from non-government organizations, like nonprofits and companies. Many corporate organizations offer private grants to provide more opportunities for organizations to get funding for their various projects and initiatives. Because they have fewer regulations required for them, you might have fewer restrictions and qualifications to meet, making it easier to be eligible for these grants.
Private grants benefit many organizations by allowing teams to partner with local or corporate businesses. Organizations can list their grant providers as project sponsors, allowing more marketing and advertising for private donors and grants. Recipients can also benefit because receiving private grants paired with other financing options and federal grants can prevent them from taking out loans they cannot repay.
Private grants also offer more diverse options to organizations. You can find private investors and providers who care about various causes and ventures, allowing your organization to apply more strategically to grants you have higher chances of receiving.
However, private grants might have fewer funds available and can still be highly competitive. Like federal organizations, corporate and private donors will publish notices online when grants open, so they can receive plenty of applications. Limited budgets that depend on company profits might decrease the amount they can spend on any given project, even if you meet their requirements.
When applying for federal and other types of grants, your teams should compile all essential documents in your application and submit them by due dates for sponsors to consider your organization and cause. Various strategies can strengthen your chances of receiving the funding your organization needs to continue offering your services.
The main reason organizations get denied grant funding is because they apply for grants they don’t qualify for. Government and private entities will carefully outline their eligibility requirements for applicants, from the essential documents to qualifying factors, like population thresholds and operation levels. Many grant providers target specific industries and applications for their grants, like science and technology or human services organizations.
When you want to optimize your chances of grant approval, you can streamline operations by limiting your applications to only those you meet all eligibility requirements for.
Grants can be comprehensive, requiring several documents and proof to complete the application and prove to providers that you meet their qualifications. Most grants will include a public burden statement with their description and information. This statement will outline how much work it will take to complete a successful application and how long it will take. It can help organizations determine if they have the resources and time to submit this application to better optimize their operations and hard work.
This statement will also tell you how detailed your application must be. While some grants might just require some examples and a general summary of operations, others will need historical data, which can take more time and effort to compile. By assessing the public burden statement, you can choose grants that match your capabilities and available time.
Many grant providers choose specific types of projects to receive their grants. This grant history can create a pattern that interested organizations can use to determine if your project and organization are the right fit for approval. Grant providers and federal organizations often publish past grant recipients. You can review these databases to determine if your organization matches what they are looking for.
Referring to past funding recipients can shed more light on a grant’s requirements and qualifying factors. Reviewing past recipients can determine if your organization matches what they are looking for beyond just the baseline. You can better tailor your applications to meet their qualifications and optimize your efforts for stronger results.
Because grants have such specific qualifications and eligibility requirements, grant providers will get several applications from similar organizations. They will often look for organizations that stand out and get their attention or show they are doing something different than others. When applying for grants, especially competitive ones, you can help your application better catch the attention of reviewers by highlighting what makes your organization unique.
For example, many local governments in more rural areas will apply for funding to help support public services and projects. However, the struggles of small, rural areas are often similar to other locations, making it challenging for local governments to get attention with the same narrative proposed by other localities. Instead, these agencies can outline the specific and unique challenges that their area is facing to increase their chances of receiving funding.
When determining your distinguishing factor, consider the individuals you serve. What makes them choose your organization over others? It is likely you provide services and care they cannot get through other resources, making yours more unique and impactful to their daily lives.
Another way you can increase your competitiveness is to create a narrative with your application. Tell a compelling story beyond dry data to give grant providers a more nuanced depiction of your organization, operations and the individuals you help. A mix of data and storytelling can create an impactful and comprehensive application that meets eligibility standards and stands out from other applicants.
Because grant reviewers have so many applications to sort through, make a better first impression by making your application and proposal concise and easy to read. When teams can efficiently review your application, they can better stick to their schedule and quickly determine funding allocation and divisions.
With a concise and clear grant proposal, you quickly communicate your point to reviewers while still including the essential details to help your organization stand out. Your format should support your application’s brevity while optimizing clarity. Details like bullet points, page numbers, a table of contents, and graphics make your application more scannable for review teams, so they can quickly find and look over essential information they need to make an informed decision.
Whether you are applying for a grant for the first time or a continuation grant, your past performance data can support your needs. For example, you might show how your audience has increased over the past years, helping support your argument for funds to expand your facilities, equipment or marketing campaigns. This information can provide the evidence review teams need to distinguish your organization from others while strengthening your argument.
Continuation grants often require historical data. You must prove that you are meeting the requirements needed for continued funds, like population and service thresholds. Historical data from the time since you received the first grant can show that you still need the funds to continue providing essential services or complete your project.
You need the right tools and resources when applying for federal, state, or private funding for your organization. IGX Solutions offers IntelliGrants® IGX — an intuitive grant application management solution you can personalize to your needs. The solution increases organizational visibility, allowing you to better track and understand grant application status and progress. The centralized system keeps all information organized in one place for increased access and streamlined operations.
Request a demo below or contact us to discover how IntelliGrants IGX can help your organization manage and secure new and continuation grants.
