If your nonprofit is planning to purchase property, upgrade facilities, or invest in major equipment using federal grant dollars, you’ll need more than just a solid budget—you’ll need to navigate a complex web of compliance rules that can make or break your funding eligibility. 

This practical guide written for Nonprofit Accounting Basics, YPTC Associate Nathan Oberle breaks down the technical and compliance aspects of using federal funds for capital projects. From understanding key terms like “ownership interest” and “federally-owned equipment” to mastering the nuances of procurement standards and property management, this article is a must-read for nonprofit executive directors, CFOs, and finance teams who want to stay audit-ready and compliant. 

You’ll learn: 

  • When and why prior written approval is required for capital expenditures 
  • What makes a cost allowable under federal award guidelines 
  • How to align your procurement policies with federal standards 
  • What your property management system must include to pass scrutiny 
  • The rules around asset use and disposition—and how long federal interests can last 

Plus, the article features a real-world case study of a Colorado nonprofit that successfully replaced a roof using Community Development Block Grant (CDBG) funds. It’s a clear illustration of how federal compliance plays out in practice—and how thoughtful planning can lead to successful outcomes. 

Whether you’re preparing for your next capital grant application or simply want to strengthen your internal controls, this guide offers actionable insights to help your organization protect its funding eligibility and avoid audit findings. 

Read the full article to ensure your next capital project is federally compliant from start to finish. 

Questions or comments? YPTC’s Federal Awards team provides wraparound services for government and foundation awards of every kind. Write us at federalawards@yptc.com.   


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