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Grants are non-repayable funds or products disbursed or given by one party (grant makers), often a government department, corporation, foundation or trust, to a recipient, often (but not always) a nonprofit entity, educational institution, business or an individual. In order to receive a grant, some form of "Grant Writing" often referred to as either a proposal or an application is required.
Most grants are made to fund a specific project and require some level of compliance and reporting. The grant writing process involves an applicant submitting a proposal (or submission) to a potential funder, either on the applicant's own initiative or in response to a Request for Proposal from the funder. Other grants can be given to individuals, such as victims of natural disasters or individuals who seek to open a small business. Sometimes grant makers require grant seekers to have some form of tax-exempt status, be a registered nonprofit organization or a local government.
For example, tiered funding for a freeway are very large grants negotiated at government policy level. However smaller grants may be provided by a government agency (e.g. municipal government).
Project-related funding involving business, communities, and individuals is often arranged by application either in writing or online.
In the United States, grants most often come from a wide range of government departments or an even wider range of public and private trusts and foundations. According to the Foundation Center these trusts and foundations number in excess of 88,000 and disperse in excess of $40 billion every year. Trusts and Foundations are a little more complex to research and can be found through subscription-based directories.
Most often, education grants are issued by the government to students attending post-secondary education institutions. In certain cases, a part of a government loan is issued as a grant, particularly pertaining to promising students seeking financial support for continuing their educations.
Grant compliance and reporting requirements vary depending upon the type of grant and funding agency. In the case of research grants involving human or animal subjects, additional involvement with the Institutional Review Boards (IRB) and/or Institutional Animal Care and Use Committee (IACUC) is required.
- National Aeronautics and Space Administration (NASA) : NASA receives and evaluates both solicited and unsolicited grant proposals. The NASA Shared Services Center (NSSC) currently awards all new grants for NASA HQ, GSFC, NMO, Stennis and Dyrden. Awards are made in accordance with the NASA Grants and Cooperative Agreement Handbook
- National Institutes of Health (NIH)
- The Center for Scientific Review (CSR) is the focal point at NIH for the conduct of initial peer review of grant and fellowship applications. It implements ways to conduct referral and review.
- The Office of Extramural Research (OER) provides guidance to institutes in research and training programs conducted through extramural (grant, contract, cooperative agreement) programs.
- National Science Foundation (NSF)
- Most NSF grants go to individuals or small groups of investigators who carry out research at their home campuses. Other grants provide funding for mid-scale research centers, instruments and facilities that serve researchers from many institutions. Still others fund national-scale facilities that are shared by the research community as a whole.
- The NSF receives about 40,000 proposals each year, and funds about 10,000 of them. Those funded are typically the projects that are ranked highest in a merit review process. These reviews are carried out by panels of independent scientists, engineers and educators who are experts in the relevant fields of study, and who are selected by the NSF with particular attention to avoiding conflicts of interest. (For example, the reviewers cannot work at the NSF itself, nor for the institution that employs the proposing researchers.) All proposal evaluations are confidential (the proposing researchers may see them, but they do not see the names of the reviewers).
The European Commission provides financing through numerous specific calls for project proposals. These may be within Framework Programmes. Although there are many 7 year programmes that are renewed that provide money for various purposes. These may be structural funds, Youth programmes and Education programmes. There are also occasional one-off grants to deal with unforeseen aspects or special projects and themes. Most of these are administered through what are called National Agencies, but some are administered directly through the Commission in Brussels. Due to the complexity of the funding mechanisms involved and especially the high competitiveness of the grant application processes (14%) professional Grant Consulting firms are gaining importance in the grant writing process.
Another funding body in Europe is the European Council. Similarly there are calls and various projects that are funded by this Council.
Grant-giving organizations in Ireland include the Irish Research Council for Science, Engineering and Technology and Science Foundation Ireland for research grants.
Denmark has an educational universal grant system, SU (Statens Uddannelsesstøtte, the State Education Fund). It is available to all students from 18 years of age, with no upper limit, who are currently taking courses. There are two systems of SU.
- Youth Education (Ungdomsuddannelse), available to all students in pre-university education (upper secondary education).
- Higher Education (Videregående Uddannelse), available to all students in post-secondary (higher education), is a coupon grant valid for 5 years and 10 months from beginning higher education.
In addition to the government grant scheme, more than 35,000 grants in Denmark exists, which is the second largest number of foundations in Europe by country. The foundations are estimated to possess 400 billion Danish kroner (US$60 billion) in accessible funds.
In Poland there exist two major grant organisations, both founded by the government:
- National Science Centre
- The National Centre for Research and Development
Foundation for Polish Science also offers different kinds of scientific grants for distinguished scholars, both Polish citizens and foreigners.
Grants are made available in the United Kingdom for a variety of business, charitable and research purposes. The biggest grant distributors are government departments and agencies which offer grants to third party organisations (often a charitable organisation) to carry out statutory work on their behalf.
Other major grant distributors in the United Kingdom are the National Lottery, charitable trusts and corporate foundations (through Corporate Social Responsibility policies). For example, Google contributes to the grants process through its Google Grants programme, where any charitable organization can benefit financially from free Google Ads advertising if they share Google's social responsibility outcomes.
Grants are time limited (usually between one and three years) and are offered to implement existing government policies, to pilot new ways of doing things or to secure agreed outcomes. A grant will usually only be given for a specific project or use and will not usually be given for projects that have already begun.
Over the years the discipline of writing grant bids has developed into a specialised activity. Many organisations employ fundraising professionals to carry out this work. In the United Kingdom the fundraising profession is governed by The Institute of Fundraising. The grant writing process generally includes search, proposal and accounting for competitive grant funds. Traditional search methods - for example referring to the Charities Aid Foundation Directory of Grant Making Trusts - are quickly becoming replaced by online fundraising tools.
Econometric evidence show public grants for firms can create additionality in jobs, sales, value added, innovation and capital. For example, this was shown to be the case for large public R&D grants, as well as for public grants for small and medium sized firms or tourism firms.
- "Foundation Center". Foundation Center. 2012-11-16. Retrieved 2013-01-09.
- "Government Grants for College". School Grants Guide. Retrieved 9 June 2012.
- "NASA Grants and Cooperative Agreement Handbook". NASA. Retrieved 17 September 2015.
- "Horizon 2020 statistics - Horizon 2020 - European Commission". Horizon 2020. Retrieved 2016-10-22.
- "Danish Education Support Agency". Statens Uddannelsesstøtte. Archived from the original on 6 June 2012. Retrieved 9 June 2012.
- "Small business finance". Bexfinance.com. 2011-10-03. Retrieved 2013-01-09.
- Howell, Sabrina T. (2017). "Financing Innovation: Evidence from R&D Grants". American Economic Review. 107 (4): 1136–1164. doi:10.1257/aer.20150808.
- Dvouletý, Ondřej; Srhoj, Stjepan; Pantea, Smaranda (2020). "Public SME grants and firm performance in European Union: A systematic review of empirical evidence". Small Business Economics: 1–21. doi:10.1007/s11187-019-00306-x.
- Srhoj, Stjepan; Vitezić, Vanja; Walde, Janette (2021). "Do small public grants boost tourism firms' performance?". Tourism Economics: 1–18. doi:10.1177/1354816621994436.