During the 1980s, federal spending for procurement, particularly defense procurement, retirement and survivors' benefits, medical benefits, and agricultural assistance payments grew dramatically, while spending for grants and salaries and wages lagged. But, the overall distribution of funding between metropolitan and nonmetropolitan areas remained fairly stable. Per capita federal funding, excluding loans, was approximately 7% above the national average in metro counties and approximately 18% below the national average in nonmetro counties in both fiscal years 1980 and 1985. This booklet reports in detail the metro/nonmetro distribution of federal funds and distribution of federal funds by type of state, providing numerous tables and graphs. It interprets the data in terms of costs of federal funds, benefit spillovers, income and employment effects, and loans versus spending, taking into account metro/nonmetro reporting biases. The report concludes that federal funds provide a smaller stimulus for economic development in nonmetro counties than in metro counties. Nonmetro areas rely much more heavily on income redistribution programs. Developmental impact of federal funding in nonmetro areas would be greater if they received their share of funds from a different mix of programs. This report contains 13 references and many tables. (DHP)