1.2.3 Federal Grants $ 2.082 billion in 2002

An important source of revenues to the state is federal government grants. Alaska has historically been near the top of the states in federal grants per capita and has led other states by a large margin in recent years. These grants fund more than a quarter of the operating budget and most of the capital budget. Each grant comes with a specific purpose. For example, a large share of the capital grants are for transportation projects. The state can choose which projects to construct but must use the grant proceeds in ways prescribed by the federal government.