Funds that are given by Congress to states and localities and that are earmarked by law for specific categories are known as

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Categorical grants-in-aid are funds given by Congress to state and local governments that are designated for specific purposes, such as education, transportation, or environmental protection. The funds are earmarked by law for these specific categories and are usually accompanied by specific requirements and conditions that the states and localities must meet in order to receive the funds. This allows Congress to exert some control over how the funds are used and to ensure that they are being used for the intended purposes.

Funds That Are Given by Congress to States and Localities