U.S. Department of Agriculture Rural Development Water & Sewer Loan/Grant Program Community Facility Loan/Grant Program
Community Programs Rural Development has two programs for rural communities: o o Community Facilities (town halls, fire halls, DPW buildings, fire trucks, police cars, libraries, etc.) Water & Waste (water & sewer projects) Website - http://www.rurdev.usda.gov/mi/
In 2012, for all programs, USDA Rural Development invested approximately $950 million in Rural Michigan. Programs include: o Water & Waste o Community Facilities Loans and Grants o Telecommunications, Distance Learning Grants, Broadband o SFH Direct & Guaranteed Home Loans o Home Repair Grants & Loans o MFH Direct & Guaranteed Loans o MFH Rental Assistance o MFH Housing Preservation Grants o Guaranteed Business and Industry Loans o Renewable Energy Grants
Community Programs Community Facilities: eligible entities include: Public bodies, non-profits, & tribes located in communities or a service area less than 20,000 population. Water & Waste: eligible applicants include: Public bodies, tribes, non-profits located in communities or a service area less than 10,000 population.
2012 Water & Waste/Community Facility Totals Loan $105,679,000 Grant $11,521,672 TOTAL - $117,200,672 Water & Waste approximately 24,117 residents benefited from 36 projects Community Facilities 84 equipment and/or construction projects in over 70 communities.
Water/Sewer & Community Facility Fun Fact $590,208,000 Water & Sewer Loan Portfolio 12/31/2012 $548,715,000 Water & Sewer Loan Portfolio 12/31/2011 Increase - $41,493,000 $154,715,000 Community Facilities Portfolio 12/31/2012 $143,393,000 Community Facilities Portfolio 12/31/2011 Increase - $11,322,000 Total - $52,815,000 Increase to outstanding loan portfolio represents loans closed and cash advanced to construction of projects or purchase of equipment.
2013 Levels of Funding: Expected Water & Waste 2013 Regular Allocation : Direct Loan: $27,235,000 Direct Grant: $ 9,135,000 Expected Community Facilities 2013 Regular Allocation: Loan: $31,714,000 Guarantee: $ -0- Direct Grant: $ 214,000 Economic Impact Initiative Grant: $ -0- Under Continuing Resolution until March 2013.
Pending Applications Backlog of CF and WEP projects seems to be easing. Loan and grant funds are not as limited as last fiscal year MI application backlog - 18 Water & Sewer Projects = $ 51,571,000-37 CF loans & 37 CF grants = $ 50,948,000 Nationwide application backlog - 1,242 Water & Sewer Projects = $3,960,141,716-842 CF loans & 930 CF grants = $2,472,089,591 Much pressure on the states to get ARRA funded projects under construction and the money expended by 9/30/13!!
CHALLENGES TO LIMITED FUNDING! REFINANCING EXISTING DEBT- o Limited to <50% of total project. o Refinancing previous debt is an eligible for loan funds only. o However, refinancing projects does not provide new environmental/public health benefits to water quality. o If a portion of your project includes refinancing, you will receive two expected funding timeframes one without refinancing and one with refinancing.
CHALLENGES TO LIMITED FUNDING! LEVERAGING Funds from other sources including: CDBG SRF/DWRF MDOT DDA Applicant s general and/or enterprise funds The percentage of leveraging may give your project priority over another project by assigning additional priority points!
Remaining ARRA Issues ting 9/30/2013 New date for all ARRA funds to be expended. Waivers will be required for those projects not under construction by 7/31/2012. For those currently under construction, waivers will also be required if construction will be delayed past 7/31/2013.
CF and WEP Loan Terms o Up to maximum 40 year loans, dependent upon the life of facility, State/Local laws, or Repayment ability o CF Equipment and/or vehicle loans are normally 15 years or less when using Act 99 Installment Purchase Agreement very dependent upon the useful life of the equipment being purchased. o Capital Improvement Bonds have a 30 year limit. o Revenue, Junior Lien Revenue & Special Assessment bonds have a 40 year limit.
WEP Interest Rates Updated on a quarterly basis Current interest rates 1/1/2013 3/31/2013 Poverty Interest Rate o MHI of less than $36,614 with a third-party documented violation of a health or sanitary standard 1.875% Intermediate o MHI between 36,615 - $45,768 2.500% Market o MHI over $45,769 3.125% You get the best interest rate at the time of loan closing!
WEP Rule of Thumb for Grants The monthly user rate must be at least 1.5% of MHI (median household income). Example: Three communities with 500 EDUs with identical projects but with different MHIs. O&M, Repair, Replacement & Improvement reserve, bond reserve, and debt repayment total $270,000/year or $45 user rate/month. Community #1 MHI is $27,461(x 1.5% /12) = $34.33 monthly user rate - Grant eligible. Community #2 MHI is $35,500 (x1.5%/12) = $44.38 monthly user rate Grant eligible. Dependent upon grant funds availability. We may urge the community to fund the project as a loan only to expedite funding of the project. Community #3 MHI is $38,500 (x.15%/12) - $48.13 monthly user rate - Not eligible for grant funds.
CF Interest Rates Updated on a quarterly basis Current interest rates 1/1/2013 3/31/2013 Poverty Interest Rate o MHI of less than $36,614 with a third-party documented health or safety issue 4.500% Intermediate o MHI between 36,615 - $45,768 3.875% Market o MHI over $45,679 3.125%
CF Rule of Thumb for Grants MHI Population Legal % Grant less than of or less than Maximum Recommended HHS Poverty Level $20,650 5000 75% 70% 60% of state MHI $27,461 5000 75% 55% 70% of state MHI $32,037 12000 55% 40% 80% of state MHI $36,614 20000 35% 25% 90% of state MHI $41,191 20000 15% 10% State MHI $45,768
Grant Funding Programs Predevelopment Planning Grants Not funded under CR Funding Limit - $25,000 or 75% of the project cost, whichever is less. Available to communities under population of 10,000 Restricted to communities with MHI below 80% of SNMHI or $36,614 Grant pays for the costs associated with developing a complete application (Preliminary Engineering Report, Environmental Report, draft Engineering Agreement, and other application documents) for a proposed project AND must be agreed to and accepted by the Agency prior to disbursement. Applicants must prove that they are unable to pay these development costs on their own. PPG funds cannot be used to pay for work already completed. Costs incurred prior to grant approval will not be considered eligible. If the Agency does not provide additional funds for any portion of the proposed project, the grant will not need to be paid back.not require repayment.
New Grant Funding Program! SEARCH Grant Not funded under CR Program parameters are the same as the PPG except: Only available to communities under population of 2,500 Funding Limit - $30,000 or 100% Grant funding, whichever is less
Other Miscellaneous Items Rural Development accepts applications year round and can fund projects any time, subject to funding availability and approval of the federal budget. If project is not selected for funding, the project remains on our application list until withdrawn by the applicant. For those pending applications, it is strongly suggested that either the applicant or the engineer keep us informed on any changes of project scope and amount of funds needed. Rural Development projects funded with our regular allocation are not required to comply with Davis Bacon.
St Clair County Village of Avoca/ Kenockee Twp Sewer Project $2,200,000
Grant WWTP Expansion Project $2,862,000
City of Essexville - $7,485,000 Hampton Township - $18,000,000 Separate/joint sewer improvement project
300 Horsepower Directional Boring Rig Project involved directional boring a 24 force main under the Saginaw River. The bore took 2 weeks. Max depth was 50 feet below the bottom of the river bed.
Harbor Beach Area District Library Building Addition
Village of Bangor Police Vehicle
Boyne EMS Rescue Vehicle