What types of federal grants are made to state and local governments and how do they work? Q.What types of federal grants are made to state and local governments and how do they work? A.The federal government distributes grants to states and localities for many purposes. Some grants are delivered directly to these governments, but others are “pass-through” grants that first go to state governments, who then direct the funds to local governments. Some federal grants are restricted to a narrow purpose, but block grants give governments more latitude in spending decisions and meeting program objectives. Regardless of type, the bulk of all federal grants are related to health care. Read more about What types of federal grants are made to state and local governments and how do they work?
What are municipal bonds and how are they used? Q.What are municipal bonds and how are they used? A.Municipal bonds (a term that encompasses both state and local government debt) are obligations that entitle owners to periodic interest payments plus repayment of principal at a specified date. States and localities (cities, townships, counties, school districts, and special districts) issue bonds primarily to pay for large, expensive, and long-lived capital projects. Read more about What are municipal bonds and how are they used?
What are state rainy day funds and how do they work? Q.What are state rainy day funds and how do they work? A.Rainy day funds, also known as budget stabilization funds, allow states to set aside surplus revenue for use during unexpected deficits. Every state has some type of rainy day fund, though deposit and withdrawal rules vary considerably. Read more about What are state rainy day funds and how do they work?