USDA Rural Economic Development Loan and Grant Program
Purpose
To promote rural economic development and job creation projects.
Applicant Eligibility
- Rural Utility Service (RUS) Electric and Telephone utility borrowers only.
- Financially sound organization.
- Current on all Federal debts.
Use of Loan Funds
- Business expansions and start-up venture costs, including, but not limited to, fixed assets, real estate, buildings, equipment, or working capital
- Business incubators
- Community development assistance to nonprofits and public bodies (particularly for job creation or enhancement)
- Facilities and equipment to educate and train rural residents to help economic development
- Facilities and equipment for medical care for rural residents
- Technical assistance
Maximum and Minimum Loan Amounts
- Maximum $1,000,000 ($300,000 grant maximum, requires 20% match from cooperative).
- Minimum $10,000.
Loan Terms and Repayment
- Zero-interest loan provided to the RUS borrower on a pass-through basis to the ultimate recipient (project owner).
- Maximum 10 year repayment period.
- Payments may be deferred up to two years.
- Repayment by the ultimate recipient may not be more restrictive than the repayment schedule of the RUS borrower.
- Minimum 20% supplemental financing required of ultimate recipient.
Application Process
- Meet with your local cooperation and fill out a pre-application form.
- Applications are submitted to the cooperative board for approval before being sent to the local USDA field representative.
- Applications are forwarded to the USDA Rural Development National Office for selection on a national competitive basis.
- Applications are reviewed quarterly.
Selection Factors
- Nature of the project.
- Job creation projections.
- Long-term improvements in economic development.
- Diversifying the rural economy or alleviating underemployment.
- Supplemental funds.
- Economic conditions and job creation.
- Unemployment rates.
- Per capita personal income.
- Change in population.
- Number of long-term jobs.
- Community-based economic development program.
- Plan for improving the marketable skills of people in rural areas.
- Location (rural).
- Support for program - cushion of credit payments.
- Demonstration project.
- Probability of success.
- Ownership and management of the project.
- Ultimate recipient’s business plan.
- Completeness of application.
Other USDA Programs
Selection of Funding Programs
- Community Connect Broadband Grants
- Socially-Disadvantaged Groups Grant
- Value-Added Producer Grants
- Rural Innovation Stronger Economy (RISE) Grants
- Agriculture Innovation Center Program
- Higher Blends Infrastructure Incentive Program (ethanol and biofuels)
- Revolving Funds for Financing Water and Wastewater Projects
- Rural Decentralized Water Systems Grant Program
- Rural Cooperative Development Grant Program
- Meat and Poultry Processing Expansion Program
- Rural Energy for America Energy Development Assistance Grants
- Business & Industry Loan Guarantees
Community Facilities Direct Loan & Grant Program - Distributed Generation Energy Project Financing
- Electric Infrastructure Loan & Loan Guarantee Program
- Emergency Community Water Assistance Grants
- Energy Efficiency and Conservation Loan Program
- The Energy Resource Conservation (ERC) Program
- Grants for Rural and Native Alaskan Villages
Multifamily Housing Loan Guarantees - Rural Business Development Grants
- Rural Microentrepreneur Assistance Program
Category: Assistance Programs