Project Grants: Definition & Examples

Project Grants: Definition & Examples
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  • 0:02 Definition
  • 0:52 Examples
  • 3:13 Criticisms of Project Grants
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Lesson Transcript
Instructor: Stephen Benz

Stephen has taught history, journalism, sociology, and political science courses at multiple levels, including the middle school, high school and college levels.

Project grants are like scholarship competitions. They give out federal money to states, localities, and individuals based on merit. We look at some examples in this lesson.


To understand a project grant, think of a scholarship competition. In a scholarship competition, students submit applications for university scholarships and try to highlight how good they are at something, like academics or sports. The most worthy applicants receive funding, while others may not receive any funding at all.

This same concept applies to project grants. State and local governments and even individuals submit their applications to the federal government asking for government help. The applications are then scored based upon certain criteria, and the winners of the grant are announced.

Project grants are a type of categorical grant. Projects are grants given by the federal government to state and local governments on the basis of merit. The other type of categorical grant is a formula grant. These grants, rather than being based on merit, are distributed to all states according to a formula.


An example of a project grant was the Department of Education's Race to the Top. In this program, different states submitted applications for up to $4 billion in supplemental education money. The states had to demonstrate their ability to hire great teachers and leaders, improve student achievement, improve state standards, improve charter school offerings and performance, turn around low-achieving schools, and improve instruction with data. Based on their applications, states could be scored up to 500 points.

In the first round of applications for Race to the Top grants, the states of Delaware and Tennessee were deemed to show the highest improvement in these educational categories. Consequently, Delaware was awarded $100 million and Tennessee was awarded $500 million. Many people criticized the inconsistency in scoring, and some states declined to participate in the project grant further. Indeed, many don't really think of Tennessee and Delaware as having the best education programs in the country. In subsequent rounds, other states won smaller awards. Nonetheless, the Race to Top project grant illustrates how the competitive grant process can draw criticism for being inconsistent or unfair.

Another type of federal project grant you may have heard of is the Federal Pell Grant system. This grant is given to students who meet income requirements and have not yet earned a bachelor's degree. The grants do not have to be repaid. Around five million university students are annually awarded Pell grants of up to $5,000.

Another major type of project grant is the National Endowment for the Humanities. This project grant gives grants to individuals and institutions to provide funding for further study and/or research in humanistic research. In 2014, the U.S. government allocated $146 million towards the National Endowment for Humanities.

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