Certified Government Financial Manager (CGFM) 2025 – 400 Free Practice Questions to Pass the Exam

A project grant is designed to provide funding for a specific purpose over a set period. This type of grant is often awarded for particular projects or initiatives and is typically subject to strict guidelines about how the money may be spent. This funding is intended to achieve defined outcomes or objectives that are predetermined in the application process. The limited duration emphasizes the grant's focus on a particular project rather than ongoing funding.

In contrast, a formula grant allocates funding based on specific formulas, often related to criteria such as population or need, rather than for a defined project. Block grants provide a lump sum of funds to states or municipalities to use in broader categories, giving them more flexibility in how the money is spent. Discretionary grants are awarded based on the judgment of the granting agency and can also be for specific purposes, but they may not always be for a limited time, as they can sometimes fund ongoing programs.

Therefore, the defining feature of a project grant is its specificity and time-limited aspect, making it the correct answer to the question.