Quick Program Reference Guide For USDA Rural Development Funding Programs VISION STATEMENT "A rural America that is a healthy, safe and prosperous place in which to live and work." MISSION STATEMENT "To increase economic opportunity and improve the quality of life for all rural Americans." TERRY BRUNNER State Director Website: www.rurdev.usda.gov December 2011
Rural Development Business and Cooperative Programs 505-761-4953 Program Objective Applicant Uses Population Loan/Grant Terms/Conditions Business and Industry Guaranteed Loans Rural Business Enterprise Grants Create jobs and stimulate rural economies by providing financial backing for rural businesses. Finance and facilitate the development of small and emerging private business enterprises. Businesses. Apply through Federal or State chartered banks, credit unions, or savings & loan associations. Public entities, private nonprofit corporations, institutions of higher education and federally recognized Native American tribal groups. Most legal business purposes except production agriculture. Include acquisition, start-up and expansion of businesses that create rural employment. Buy and develop land, establish a revolving loan fund, construct buildings and plants, purchase equipment, access streets and roads, develop parking areas, utility and service extensions, and rural distance learning networks. urbanized areas. urbanized areas. Loan guarantee. Lender and borrower negotiate terms. Interest rate tied to published rate that may change no more often than quarterly. When grant funds are used for revolving loan fund (RLF), the intermediary makes loans to businesses from its RLF on terms consistent with security offered. Intermediary Relending Program Loans Finance business facilities and community development projects in rural areas. Public entities, non-profit corporations, Native American tribes, and cooperatives. Community development projects, establishment or expansion of businesses, creation or saving of rural jobs. Rural areas and incorporated sites with populations of than 25,000. Direct loan. The intermediary makes loans to businesses from its revolving loan fund on terms consistent with security offered. Intermediary pays 1 percent for 30 years. Rural Economic Development Loans and Grants Rural Cooperative Development Grants Value Added Producer Grants Rural Business Opportunity Grants Small, Socially- Disadvantaged Producer Grant Program Finance economic development and job creation in rural areas. Establish and operate centers for cooperative development to improve the economic condition of rural areas through the development of new cooperatives and improving operations of existing cooperatives. Assist independent agricultural producers to enter into activities that add value to their crops. Finance technical assistance for business development planning in rural areas. Provide technical assistance to small, socially-disadvantaged agricultural producers through eligible cooperatives and associations of cooperatives. Rural Utilities Service-financed electric and telephone utilities. Non-profit corporations and institutions of higher education. Independent producers, farmer and rancher cooperatives, agricultural producer groups and majority-controlled, producerbased business ventures. Public bodies, non-profit corporations, institutions of higher education Native American tribes on federal or state reservations, and cooperatives with members that are primarily rural residents. Cooperatives or associations of cooperatives. Must be farmer or rancher owned and controlled business, organized and chartered as a cooperative, from which benefits are derived and distributed equitably on the basis of use by each of the farmer or rancher owners whose primary focus is to provide assistance to small, socially disadvantaged agricultural producers and where the governing board and/or membership is comprised of at least 75 percent sociallydisadvantaged producers. Business startups or expansion projects that create rural jobs. Establish operating centers for development of rural cooperatives. Planning purposes such as conducting feasibility studies or business plans; or use as working capital to help start the operations of a new venture. Technical assistance, leadership training, establishment of business support centers, and economic development plans. Technical assistance to benefit their members or other small socially-disadvantaged producers who are not members. 2 Rural areas and places with populations of 50,000 or. revolving loan fund The intermediary (electric or telephone utility) makes loans to profit or non-profit business and public bodies for rural economic development and/or job creation projects. Loans are 0 percent for 10 years. No population restriction. Applicants must meet specific selection criteria including a minimum 25 percent fund match. Grants are awarded on a competitive basis. Some funds are reserved for applicants that focus on assistance to small, minority producers through their cooperative businesses (governing board or membership at least 75 percent minority). No population restriction. Applicants must meet specific selection criteria. Grants are awarded on a competitive basis. Funds cannot be used to build facilities or purchase equipment. Funds must be matched on a dollar-for-dollar basis. urbanized areas. urbanized area. Grant Must be completed within 2 years after project has begun. Maximum award is $200,000. Grant funds must be Expended in 12 months. Technical Assistance for this program is considered an advisory service performed for the benefit of a small, socially-disadvantaged producer such as market research; product and/or service improvement; legal advice and assistance; feasibility study, business plan, and marketing plan development; and training. Technical assistance does not include the operating
Program Objective Applicant Uses Population Loan/Grant Terms/Conditions Biomass Research and Development Initiative Section 9007 Rural Energy for America Program Section 9003 Biorefinery Assistance Finance the research and development of biomass based products, bioenergy, biofuels and related processes. To reduce energy costs and consumption To assist in the development of new and emerging technologies for the development of advanced biofuels by providing guaranteed loans for the development and construction of commercial scale biorefineries or the retrofitting of existing facilities using eligible technology. Institutions of higher education, national laboratories, federal or state research agencies, private sector entities and non-profit organizations. Apply to Rural Development Ag producers and small businesses for RE and EE projects and feasibility studies. Energy audit & renewable energy assistance applicants are public bodies, institutions of higher learning, REC s & others. Individual entity, Indian tribe, or unit of State or local government, including a corporation, farm cooperative, farmer cooperative organization association of agricultural producers, National Laboratory, institution of high education, rural electric cooperative, public power entity, or consortium of any of those entities. Research and development of biomass based products, bioenergy, biofuels and related processes. Renewable energy projects, energy efficiency projects, stand alone feasibility studies, and energy audit & renewable energy assistance. Grants for the development and construction of demonstration scale biorefineries to demonstrate the commercial viability of 1 or more process for converting renewable biomass to advanced biofuels and guarantees to fund the development, construction, and retrofitting of commercial scale biorefineries using eligible technology. No population restriction Applicants must meet specific selection criteria. Grants are awarded on a competitive basis. A minimum of 20 percent cost sharing requirements apply, and may be u to 50 percent depending on nature of project. Cost share must come from non-federal sources. urbanized area 50,000 or and not in an urbanized area. Grants, and loan guarantees Guaranteed loans authorized by statue but information released to date has only been for Guaranteed loan funds. Grant 25% of eligible project costs-$2,500 min & $500,000 max renewable energy -- $1,500 min & $250,000 max energy efficiency, G-loans and combos up to 75% eligible project costs. Maximum G-loan $25 million. If loan amount is equal to or than $80 million, the maximum guarantee is 80% of principal and interest due if loan amount is grater tan $80 million but than $125 million, the maximum guarantee is 70%ofthe amount in excess of $8- million if the loan is equal to or greater than $125 million, the maximum guarantee is 60% of the entire loan amount. Interest rate is negotiated and length can be no more than 20 years. Section 9004 Repowering Assistance Section 9005 Bioenergy for Advanced Biofuels Section 6002 Rural Micro Entrepreneur Assistance Program Authorized in the 2008 Farm Bill Descriptions in boxes to the right come from the conference report To assist biorefineries to replace fossil fuels used to produce heat or power to operate the biorefineries by making payments for the installation of new systems that use renewable biomass or the new prosecution of energy from renewable biomass. To make payments to eligible producers (of advanced biofuels) to support and ensure an expanding production of advanced biofuels. To provide micro-entrepreneurs with the skills necessary to establish new rural micro enterprises; and continuing technical and financial assistance related to the successful operation of rural microenterprises. Biorefineries in existence on the date of enactment of the 2008 Farm Bill Eligible advance biofuel producer (individual or legal entity) Microenterprise development organizations such as nonprofit entities, Indian tribe, or public institution of higher education. Installation of new systems that use renewable biomass to replace use of fossil fuels Payments to support production of advanced biofuels Training & technical assistance, and/or microloans to facilitate access to capital or another related service, for the benefit of rural microentrepreneurs and microenterprises. 50,000 or and not in an urbanized area 50,000 or and not in an urbanized area urbanized area. Payments Payments Loans and grants Payments of up to $5 million or 50% of total eligible project costs, whichever is Payment rate to be determined The Agency will make direct loans to microlenders for the purpose of providing fixed interest rate microloans to rural microentrepreneurs for startup and growing microenterprises. Eligible microlenders will also be eligible to receive microlender technical assistance grants to provide technical assistance and training to microentrepreneurs that have received or are seeking a microloan under this program. 3
Rural Development Housing Programs 505-761-4973 Art Garcia Program Director Program Objective Applicant Uses Population Loan/Grant Terms/Conditions Safe, well-built, affordable Direct loan. homes for rural Americans. Single Family Home Ownership Direct Loans (Section 502) Single Family Home Ownership Direct Repair Loans and Grants (Section 504) Single Family Home Ownership Guaranteed Loans (Section G-502) Mutual Self-Help Home Ownership Loans (Section 523) Mutual Self-Help Housing Grants (Section 523) Rental Housing for Families and Elderly Direct Loans (Sections 515) Rental Housing for Families and Elderly Loan Guarantee (Section 538) Housing Preservation Grants (Section 533) To help very-low-income applicants remove health and safety hazards or to repair their homes. Assist eligible applicants in buying their homes by guaranteeing loans made by private lenders. Individual incomes not to exceed 115% of area median income Individual homes built by a group of applicants with construction guidance provided by a non-profit organization. Assist lower income families in building their own homes. Safe, well-built, affordable rental housing for very low, low to moderate income households. Rents are based on 30% of adjusted household income To construct rental housing for households whose incomes at initial occupancy do not exceed 115% of median income Repair and rehabilitate individual or rental housing owned or occupied by very-low and low-income rural families. Families and individuals. Apply to Rural Families and individuals who currently own their home. Apply to Rural Families and individuals. Apply to lender. Families/individuals apply to Rural Loan applications are processed on an individual basis for each participating family. Non-profit organizations and public entities. Apply to Rural Individuals, limited profit and non-profits and Tribal entities. Apply to Rural Individuals, limited profit and non-profits and Tribal entities. Apply to intermediary lender. Public bodies, non-profits and Tribal entities. Apply to Rural Buy, build, improve, repair or rehabilitate a rural home to become the applicant s permanent residence. Repair or replace roof, winterize, purchase or repair heating systems, structural repair, disability accessibility, water and sewage connect fees, and similar uses. Purchase new or existing home. Construction of a new home, in part by the applicant, under supervision. Technical assistance to qualify and supervise small groups of families to build each other s homes. New construction or substantial rehabilitation of rental housing. New construction or substantial rehabilitation of rental housing Operates a program which finances repairs/rehabilitation activities for single family or rental properties population of 20,000 or and under certain conditions towns and cities between 20,000 and 25,000 Rural communities with populations of 10,000 or. Eligible areas are tied to the State s Place List published annually in the NOFA. Rural communities with populations of 10,000 or Rural areas in non MSA communities with populations of 10,000 or. Loan guarantee. Direct loan. Direct loan Loan Guarantee Up to 100 percent of market value or cost whichever is. Loan amortized for 33/38 years. Applicant may be eligible for payment assistance (subsidy) on the loan. Loan terms to 20 years at 1 percent. Assistance to individual may not exceed $20,000. Grants only available to very-low-income applicants 62 years or older who cannot afford to pay 1 percent loan. 30 year, fixed rate. Interest rate negotiated between lender and borrower. Loans to 100 percent of market value. Individual families receive a direct loan from Rural Participating non-profit housing organization acquires a grant to hire a supervisor and pay other administrative expenses. Grant agreement. Applications accepted under a NOFA. Finance up to 100% of total development cost for non-profits; 97% limited profits and 95% for applications with lowincome housing tax credits. Interest rate reduced to 1% for proposals operating on a limited profit basis. Financed 30-year term with a 50 year amortization. Application accepted under a NOFA. Up to 90% loan guarantee to eligible lenders, maximum loan 40 yrs. Rate Fixed negotiated between lender and borrower. Applications accepted under a NOFA. Grant agreement. A two year program, highly competitive. Farm Labor Housing (Sections 514 & 516) Safe, well-built, affordable rental housing for occupancy by farm workers. Individuals, public, private non-profit, Tribes and association of farmers/ cooperatives. Apply to Rural New construction or substantial rehabilitation of rental housing. No population restriction. Application accepted under a NOFA. Can finance up to 100% of total development cost (TDC) to non-profit or 95% to limited partnerships w/low income housing tax credits. Term 33 yrs at 1 percent interest. Grants up to 90% of TDC available only to non-profits. 4
Rural Development Community Programs (Utility and Community Facilities Programs) 505-761-4954 Martha Torrez Program Director Program Objective Applicant Uses Population Loan/Grant Terms/Conditions Water and Waste Disposal Loans and Grants Provide infrastructure for rural areas. Public entities, counties, Native American tribes, and non-profit corporations. Build, repair, and improve public water systems, and waste collection and treatment systems. Also finance other related costs. Rural areas, cities, and towns with up to 10,000 Interest rates are set quarterly based on an index of current market yields for municipal obligations. Repayment period is a maximum of 40 years. Grant funds may be available. Water and Waste Disposal Loan Guarantees Provide infrastructure for rural areas. Public entities, counties, Native American tribes, and non-profit corporations. Construct, repair, modify, expand, improve water supply and distribution systems, and waste collection and treatment systems. Also finance other related costs. Rural areas, cities, and towns with up to 10,000 Loan guarantee. Eligible lenders obtain up to a 90 percent guarantee on loans they make and service. Lenders should contact Rural Development Area or State Office. Solid Waste Management Grants Provide technical assistance and/or training to help communities reduce the solid waste in streams and the earth. Non-profit organizations, public entities and counties Provide technical assistance and training to reduce pollution of water resources and improve management of solid waste facilities; reduce solid waste in streams. Rural areas, cities and towns with up to 10,000 Projects are funded based on selection at the national level. Applications are accepted from October 1 to December 31 of each year. Rural Broadband Loans and Loan Guarantees Electric and Telecommunications Loans and Guarantees Distance Learning and Telemedicine Loans and Grants The deployment of broadband service to eligible rural communities. Provide financial aid through direct and guaranteed loans for electric and telecommunications services. Development and deployment of advanced telecommunication services throughout rural America to improve education and health care. Legally organized entities providing or proposing to provide broadband service in eligible rural communities. Cannot serve more than 2 % of the telephone subscriber lines installed in the U.S. Non-profit and cooperative associations, public bodies, counties, and other utilities. Incorporated entities, including municipal corporations, counties, on a for profit or notfor-profit basis, that operate rural schools, libraries, health care clinics and other organizations that operate educational or health care facilities. The construction, acquisition, and improvement of broadband transmission facilities and equipment; land and buildings used in providing broadband service; and the refinancing of Telecommunications Program debt. Generation, bulk transmission facilities, and distribution of electric power. Enhance 911 emergency service, digital switching equipment, fiber optic cable, along with traditional main system telecommunications service. Equipment for classrooms: cameras, video monitors, computers, and LAN. Also for physician consultation, radiology, ex-ray scanners, and digital microscopes. Eligible rural communities with a population of 20,000 inhabitants or. The community cannot be located in a standard metropolitan statistical area. Electric: Rural areas as defined by the U.S. Census. Telecommunications: Rural areas with populations of 5,000 or. Rural areas with populations of 20,000 or. Direct loans and loan guarantees. Direct loan or loan guarantee. Direct loan and/or Loans are made at the Treasury rate of interest at the time of the advance for a period equal to expected composite economic life of the assets financed. Loans are guaranteed at the interest rate set by the private lender for no more than 80 percent of the principal amount. Interest rates are established in accordance with 7 CFR 1745. Matching funds are required. Community Facilities Provide essential community facilities for rural communities. Public bodies, counties, nonprofit organizations, and Native American tribes. Build facilities and purchase equipment for fire and rescue, telecommunications, schools, libraries, hospitals, etc. Rural areas, cities, and towns with up to 20,000 Direct loan or loan guarantee, Up to 100% of market value. Applicant applies through an eligible lender who then applies to Rural Development for a guarantee of up to 90%. 40 year maximum term or life of security. 5
Contact Information State Office USDA Rural Development 6200 Jefferson NE Room 255 Albuquerque, NM 87109 505-761-4950 Terry Brunner State Director terry.brunner@nm.usda.gov Website: www.rurdev.usda.gov Business & Cooperative Programs Director: (505) 761-4953 terry.brunner@nm.usda.gov Community Programs Director: Martha Torrez (505) 761-4955 martha.torrez@nm.usda.gov Rural Housing Programs Director: Art Garcia (505) 761-4944 arthur.garcia@nm.usda.gov Field Offices Aztec 1427 West Aztec Blvd Suite 1 Aztec, NM 87410 505334-3090 Extension #4 Las Cruces 2510 N. Telshor Blvd. Las Cruces, NM 88011 575-522-8775 Extension #4 Los Lunas 2600 Palmilla Road Suite C Los Lunas, NM 87031 505-865-4643 Extension #4 Roswell 1011 Atkinson Ave. Roswell, NM 88203 575-622-8745 Extension #4 Las Vegas 1927-A North 7 th Street Las Vegas, NM 87701 505-425-3594 Extension #4 USDA is an equal opportunity provider and employer. To file a complaint of discrimination, write: USDA, Office of the Assistant Secretary for Civil Rights, Office of Adjudication, 1400 Independence Ave., SW, Washington, DC 20250-9410 or call (866) 632-9992 (Toll-free Customer Service), (800) 877-8339 (Local or Federal relay), (866) 377-8642 (Relay voice users). 6