A mandatory grant is Federal financial assistance award with specific eligibility criteria imposed by Federal statute.
Mandatory Grant Programs
A mandatory grant, unlike a discretionary grant, is awarded based on specific criteria set by Federal legislation. A formula grant is a type of mandatory grant.
505 DM 2 Department of the Interior: Procurement Contracts, Grant and Cooperative Agreements
C. Mandatory Grant - A grant program in which the Federal agency is required to make an award based on prerequisites specified by statute or implementing program regulations, e.g., an entity submits an acceptable State Plan or application that meets the eligibility and compliance requirements of the statutory and regulatory provisions of the grant program. There is generally no competition for funds among eligible entities in mandatory grants.
U.S. Fish and Wildlife Service: Issuing a New Financial Assistance Award Guidance (October 5, 2018)
Mandatory program: A program with an authorizing statute requiring the government to make an award to each eligible entity under the conditions and in the amount (or based on the formula) specified in the statute. Under mandatory programs, no competition for funds among eligible entities is required.