Capital grants are financial transfers from senior governments to municipalities designated for infrastructure and capital projects. These grants help fund construction of buildings, roads, water systems, transit, and other major physical assets. Unlike unconditional grants that municipalities can use flexibly, capital grants typically come with conditions specifying eligible uses. Capital grant programs at both federal and provincial levels have various names, criteria, and application processes. Municipalities often rely on capital grants for major projects, as property tax revenue alone cannot fund large infrastructure investments. Grant program changes significantly affect municipal capital planning and project timing.