A cash grant refers to an emergency fund for financial emergencies (the equivalent to government money being available on a tight time limit to people who need it). To quote Wikipedia,:
The cash grant is typically a cash grant to a state, federal, or local government in need when the amount of funding to meet a particular budget needs is insufficient to cover full funding for the current year.
A cash grant is typically paid out by a State or federally elected agency or office of a local government. In a nutshell, when a cash grant isn’t enough to cover the costs, state or federal funding may be necessary to cover the remaining portion of operating costs.
In some cases it is a small fraction of the operating budget. If the state or local government is facing a huge shortfall in expenses, like a big power outage, this is often considered a large cash grant. If the state or local government still has money in its general fund, it may qualify for a small cash grant.
It is a misconception to think that these are “fiscal crises”. A cash grant may be called emergency fund (it’s like a reserve, but different), but it is no more “crisis-type” than the state’s reserves. Instead, cash grants are a way for the state of Missouri to reduce the amount of cash it has available to fund the state’s expenses, while at the same time helping fund local governments’ operating costs.
What do cash grants do?
Here’s a simple analogy to show you just what these money can buy: You drive by a gas station that sells gallon-jugs of gas for $1.20 with tax rebate. That sounds like a good deal to you–especially if you don’t have a car. How much does it save you?
Well, firstly, if you want to buy a quarter of a gallon of gas, you’d have to drive to the gas station (because there isn’t one) $2.70. If you wanted to buy the same kind of gallon jug you would have to drive 2.7 miles to the nearest gas station for only $1.05–which may seem like a great deal, yet it means losing about $0.50 to drive to the gas station.
And a quarter of a gallon is not enough money to pay for 1 gallon of gas. However, the state of Missouri can give you a cash grant to buy an additional gallon. Suppose you drove 6 miles to the station to buy one gallon
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