Conditional funding (also called conditional grants or tied transfers) is money from senior governments that comes with requirements about how it must be used. Unlike unconditional funding that recipients can use flexibly, conditional funding specifies eligible uses, reporting requirements, and sometimes matching contributions. Federal infrastructure programs typically provide conditional funding—money can only build eligible project types and municipalities must demonstrate compliance. Conditions allow funders to ensure money achieves intended purposes, but recipients may prefer flexibility to address local priorities. Debates about conditional versus unconditional funding reflect tensions between accountability for how public money is spent and local autonomy to set priorities.