USDA Rural Economic Development Loan and Grant Program
To promote rural economic development and job creation projects.
- 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-ups.
- Community development projects.
- Business incubator projects.
- Project feasibility studies.
- Advanced telecommunications and computer networks for medical and educational services.
- Community antenna television systems or facilities (with restrictions).
Maximum and Minimum Loan Amounts
- Maximum $1,500,000 ($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.
- Applications are submitted to your local field representative.
- Applications are forwarded to the USDA – Rural Development National Office for selection on a national competitive basis.
- Applications are reviewed quarterly.
- 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.
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