Believe it or not, the federal government provides more money to states and local governments through grants than it does through contracts (and that even includes the contracts from the Department of Defense).
Over the last few years, hundreds of billions of dollars have been made available, directly or indirectly, to benefit states and local governments. This includes grants that were part of the American Rescue Plan Act, which appropriated $350 billion in state and local fiscal recovery funds to help with the COVID-19 pandemic; the Bipartisan Infrastructure Law, which provides $1.2 trillion for transportation and infrastructure projects including $550 billion for “new” efforts; and the $53 billion CHIPS and Science Act, intended to ensure that the United States remains competitive in the design and manufacture of advanced computer chips.
It would seem that states and local governments merely need to bring their buckets down to this enormous well of federal dollars and they’d be able to pull up all the money they’ve ever dreamt of having. But things are much more complicated than that.
- Publication date: June 2024
- Authors: Katherine Barrett and Richard Greene