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Different Types of Government Grants

Now the government grants you will be applying for can typically be classified into two main categories. The first kind is the general purpose or operating support grants. They are given when funds to operate or support the general expenses of running your business are needed. These type of operating grants occur when the lender supports the organizations' goal and invests in to make the most of the grant money.

The second category of grants can be broken down into development or program grants. These types of government grants are used to support not only the procedures but also the processes in the progress of the campaign. These can include planned activities targeted to get positive feedback.

Government grants can be broken down even further into the common kinds of project grants, here are some of them:

1.) Planning grants

If you already have a business or you're currently starting to plan your business you may already know that a lot of money and time can be spent in getting your plans underway. To be successful in obtaining this type of grant it would be best to research whatever is needed, consult with the people involved, strategize a plan of attack before ever attempting to sit down and write your grant proposal.

2.) Start-up grants

Also known as seed money, start-up grants assists an organization during its first couple of years. It is like a push for the business venture to do well without worrying about financial resources. These grants are often for more than a year and it decreases as each year pass as your business grows. This is because the funder expects the company to slowly get into its feet as time goes by.

3.) Facilities and equipment grants

These grants can also be known as "brick and mortar" or capital grants, these grant help the company purchase the physical assets for your business. The physical assets can include things such as the building itself, computers or even a vehicle. In your proposal for this grant you must defend the acquisition you are requesting the money for. Meaning you need to thoroughly explain how this purchase will be of service to your business and your clients. Funders will also require that the applicant makes a report on their progress, and they will double-check whether or not your company is able to maintain your facilities and or equipment over time.

4.) Endowment grants

Non-profit charities have money set aside that they use to invest and earn interest in the future. The principal sum remains untouched because they only spend the interest. These are endowment grants and are rampant with charities like hospitals and colleges. The fund-raising efforts for the benefit of hospitals and colleges start from these kind of grants. But the government makes sure that the interest of the principal sum or the endowment remains the same so that there is no need for the endowment to meet the annual operating costs.

5.) Program related investments or PRIs

Now everyone typically associates the IRS with taking your paycheck however the IRS not only allows grants to foundations, they also permit foundations to make loans through Program Related Investments or PRI's. The PRIs that have been approved are projects that met the requirements to be eligible for grant support. Usually, they are met at a low or sometimes zero interest. But because it is a loan, PRIs must be paid back by the organization. Often times, PRIs are the alternate fuel.