USDA Rural Development

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USDA Rural Development

• 2008 Pacific Aviation Directors Workshop
• Saipan, CNMI
• April 1, 2008

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Who is Rural Development?

• Farmers Home Administration
• Rural Economic Community Development
• Rural Development Administration
• Rural Electrification Administration

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Mission Statement

• Increase economic opportunity in rural America
• Improve the quality of life in rural America

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Rural Development

• Over 40 grant, direct loan, and guaranteed loan
  programs to finance housing, businesses, and
  infrastructure in rural areas.
• Program Areas
• Rural Housing Programs
• Rural Utility Programs
• Rural Business and Cooperative Programs

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Rural Housing Services

• Community Facilities (CF) Program
• Programs designed to develop and improve
  essential community facilities and services for
  public use in rural areas.
• Direct and Guaranteed loans and grants are
  available

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Community Facilities Program

• Health care facilities include hospitals, nursing
  homes, assisted living, clinics and telemedicine.
  
• Public safety facilities include police, fire
  rescue facilities, fire stations and prisons.
• Public service facilities include airports,
  community buildings, courthouses, public
  maintenance buildings, roads, bridges, libraries,
  schools and distance learning.

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Eligible purposes
Construction Expansion Renovation and
improvements Equipment and vehicle acquisition
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ELIGIBLE ORGANIZATIONS

• Public Bodies
• Federally Recognized Indian Tribes
• Non-Profit Corporations

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Community Facilities

• Interest Rates
• Guaranteed loans - negotiated between the lender
  and the borrower, fixed or variable.
• Direct loan - interest rate currently ranges from
  4.5 to 5.0.
• Loan Terms
• The useful life of the facility, but not to
  exceed State Statute or forty (40) years,
  whichever is less.

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Rural Housing Services

• CF Guaranteed Loans
• Rural Developments CF Guaranteed Loan program
  partners with lending institutions to provide
  loans for essential community facilities.
• A guaranteed loan is often made in combination
  with a direct loan, but can also be made alone.

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PERCENT OF GUARANTEE

• The Guarantee is negotiated between the lender
  and the agency.
• The maximum guarantee is 90.
• The lender must retain 5 of the total loan from
  the unguaranteed portion.
• Cannot guarantee tax exempt issues.

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Rural Community Development Initiative (RCDI)

• Program started in Fiscal Year 2000
• Encompasses all Rural Development
• programs.
• Administered by Community Programs Division

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What is RCDI?

• A grant program to develop the capacity and
  ability of
• nonprofit organizations, low-income rural
  communities, or federally recognized tribes,
• in the areas housing, community facilities, or
  community and economic development.

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RCDIAssistance Delivery System

• Rural Development
• Intermediary (Grantee)
• Recipient
• Beneficiary

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Funding

• Annual allocation of 6,000,000
• Minimum grant request - 50,000
• Maximum grant request 300,000

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Technical Assistance

• Skilled help to improve the recipients ability
  to undertake community development projects.
• The intermediary must provide a program of
  technical assistance to the recipient.

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Eligible/Ineligible Purposes

• The following slides provide examples of
• eligible and ineligible purposes these are
• not all-inclusive.

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Eligible Purposes

• Provide training programs
• Hire staff to implement RCDI-eligible purposes
• Home-ownership education

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Eligible Purposes

• Purchase computer, printer, and software at
  recipient level
• Training for business entrepreneurs
• Improve organizational capacity through
  management training

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Eligible Purposes

• Financial Management
• Strategic planning
• Train the Trainer concept

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Ineligible Purposes

• Purchasing real estate
• Construction, renovations, or any
  construction-related activities

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Ineligible Purposes

• Paying general operating expenses
• Funding Individual Development Accounts (IDAs)

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Intermediary

• A private, nonprofit or public (including tribal)
  organization, that,
• provides a program of technical assistance to
  recipients.

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Intermediary Requirements

• Must have been organized for a minimum of 3
  years.
• Expertise in providing technical assistance to
  the types of recipients in their proposal.
• Utilize funds within 3 years.

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Intermediary Requirements

• Must use funds to develop the capacity and
  ability of recipient through a technical
  assistance program.
• Provide matching funds in an amount equal to the
  grant amount.
• No restriction on intermediary location.

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Matching Funds

• Cash or confirmed funding commitments.
• Must be used for the same purposes as the RCDI
  grant funds.
• Will be used in equal proportions with RCDI
• grant funds.

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Matching Funds

• Must be actual dollars spent on the program.
• Salaries cannot be used as a match.
• NO in-kind contributions.

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Recipient

• The entity that receives the technical assistance
  from the intermediary.
• Eligible recipients are
• Nonprofit organizations
• Low-income rural communities
• Federally recognized tribes

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Recipient Requirements

• Nonprofit organizations valid documentation of
  nonprofit status
• Low-income rural community a median household
  income at or below 80 percent of the State or
  national MHI
• Federally recognized tribes listed in Federal
  Register Notice

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Beneficiary

• Entities or individuals that ultimately
• receive benefits from assistance provided
• by the recipient.

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Section 9006 Rural Renewable Energy and Energy
Efficiency Program

• Program designed to assist farmers, ranchers and
  rural small businesses with energy projects.
• Provides guaranteed loans and/or grants for
  renewable energy and/or energy efficiency
  projects.

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Who is Eligible?

• Rural small businesses and agricultural producers
  can apply
• Rural All of the Western Pacific
• Agricultural Producer -- An individual or
  entity directly engaged in the production of
  agricultural products (including farming or
  ranching) that gets 50 of their gross income
  from the operations

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Who is Eligible?

• Small Business Must meet Small Business
  Administration (SBA) small business size
  standards
• www.sba.gov/size/indextableofsize.html
• Non-profits are excluded.

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What Projects are Eligible?

• Any renewable energy or energy efficiency project
  as defined in the law.
• Biomass, Anaerobic Digester, Geothermal (electric
  generation and direct use), Hydrogen, Wind, Solar
  (photovoltaic and thermal) and
• Energy Efficiency Improvements--improvements to a
  facility, building, or process that reduces
  energy consumption, or reduces energy consumed
  per square foot.

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What Projects are Eligible?

• Grants request can be up to 25 of project costs
• Renewable Energy
• Minimum grant request 2,500 (10,000 project)
• Maximum grant request 500,000 (2,000,000
  project)
• Energy Efficiency
• Minimum grant request 1,500 (6,000 project)
• Maximum grant request 250,000 (1,000,000
  project)

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Contact Information

• USDA Rural Development
• Western Pacific Area Office
• FHB Building, Suite 303
• 400 Route 8
• Hagatna, GU 96910
• Phone [phone]
• Joseph M. Diego, Area Director
• Bernadette J.U. Balajadia Area Specialist
• Steve Cruz, Area Specialist
• Web Site http//www.rurdev.usda.gov/rhs/

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Questions