Importance of Government Funding Programs

Public funding for private institutions can be a divisive issue, but government funding programs help provide the financial support that makes American innovations possible. Governmental funding supports various aspects of American research and development in the areas of science and health. Government agencies also support American culture, including education and the arts. Forms of governmental funding include grants or cooperative agreements, which fund most of a project, and matching funds, which provides partial funding.


Education in the United States is primarily funded through government sources. The U.S. Department of Education estimates that $1.13 trillion was spent on educational funding through government funding programs during the 2010-11 school year. Most of this funding, 89.2 percent, came from state and local governments, while the other 10.8 percent of government funding came from federal agencies including the Department of Education and the Department of Health and Human Services. Secondary educational institutions, including colleges and universities, receive funding from the federal government for research and development projects. According to the Association of American Universities, collegiate research and development projects at member colleges received a total of $26.1 billion.


Government programs also play a role in funding various forms of culture and art, including literature, theater and fine arts. The National Endowment for the Humanities makes funding available for research, education and preservation projects involving the humanities. As of 2011, the National Endowment for the Humanities offered development and production grants through the America's Media Makers program as well as the Bridging Cultures program, which supports projects promoting cultural understanding. Live performance and fine arts are funded through the National Endowment for the Arts. The NEA reported that 13 percent of all funding for the arts during 2004 came from government sources, 9 percent of which came from the federal government. In 2010, the NEA awarded approximately $170,906,000 to the arts through direct endowment grants, state partnerships and other funding programs.

Health & Science

The U.S. Department of Health and Human Services and the National Institutes of Health are two of the main governmental agencies providing funding programs for health and related science projects throughout America. The National Institutes of Health, or NIH, is composed of 27 different institutes, each specializing in an area of health care. One of these agencies, the National Cancer Institute, provided approximately $5.1 billion worth of funding for cancer research during 2010. The Department of Health and Human Services also funds scholarships and training programs for students preparing for a career in a health care field.

Types of Funding

Governmental agencies provide funding to organizations and individuals in various ways. Research and development projects that do not require a high degree of governmental agency involvement typically receive grant funding. The usage of grant funds are typically monitored by the awarding agency, but the project itself is the responsibility of the grant recipient. Projects requiring federal involvement, such as the use of governmental research facilities, are typically funded through cooperative agreements. Other forms of funding awarded by the federal government include cost sharing and matching funds, which are designed to provide only a portion of a project's funding.