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U.S. Government and Civics / Unit 3: Federalism

3.5 Fiscal Federalism

3 practice questionsNot yet reviewed

Notes

The national government uses money to influence states. This is fiscal federalism.

  • Categorical grants: money for a specific purpose with strict conditions (for example, school lunch programs).
  • Block grants: money for a broad area, such as community development, with more state freedom in how it is spent.
  • Mandates: federal requirements that states must follow. An unfunded mandate comes without money to pay for it. The Americans with Disabilities Act imposed requirements on state and local governments.
  • Conditions of aid: Congress can attach strings to grants. ***South Dakota v. Dole* (1987)**: Congress could withhold 5% of federal highway funds from states with a drinking age below 21.
  • States generally prefer block grants; Congress often prefers categorical grants for more control.

Practice

The federal government gives a state money that may be used only for building bridges, with detailed rules. This is a:
How did the national government get all states to adopt a drinking age of 21?
A state complains that a new federal rule requires costly changes but provides no money. The state is objecting to:

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