What is the difference between a grant award and a cooperative agreement?

The federal government makes awards for financial assistance through both grants and cooperative agreements.  A cooperative agreement is distinctly different from a grant in that it provides for “substantial involvement” between the Federal agency or pass-through entity and the grant award recipient.

In general terms, “substantial involvement” refers to the degree to which federal employees are directly performing or implementing parts of the award program. In a grant, the federal government provides oversight and monitoring but is not directly involved in the project. In a cooperative agreement, federal employees participate more closely in project activities, often working side-by-side with the grantee. The specific ways this involvement is integrated varies by Federal agency.