Contracts are generally awarded based on a Request for Proposals process.
Contracts can be for things like research, studies, construction, or specific services.
An award of funds, based on an approved application, to conduct an activity or program for which a private non-profit or public agency and the federal government wish to carry out and for which the former does not have the financial resources. In general, the process for getting discretionary funds is highly competitive. A grant made where the distribution of funds is based on some formula prescribed by legislation or executive direction rather than need. The formula is generally based upon such factors as population, enrollment, per capita income, or a specified need. A grant made to one entity, who then makes grants to another entity.