Community Programs
Community Facilities Guaranteed Loans

Community Facilities Guaranteed Loans provide funding for essential community facilities (CF) such as day care, hospitals, schools, clinics, roads, fire halls, etc. Applicants can be public bodies (city, township, county or special district), Indian Tribes, cooperatives, or other non-profit organizations. Projects must be located in rural areas and do not include cities and villages with populations in excess of 20,000. Applications are selected into the funding cycle based upon a statewide priority point system. Terms are a maximum of 40 years or the useful life of the facility, whichever is less; and interest is negotiated between the lender and borrower. No marginal loans can be guaranteed. However, the borrower must be unable to obtain credit at any reasonable rates and terms from other sources. No guarantee can be made to a Federal or State agency, or for a tax-exempt obligation. Collateral must be adequate, and may be (not limited to) revenue bonds, pledge of taxes or assessments, land, easements, rights, buildings, machinery and equipment, accounts receivable, and assignment of leases. Appraisals are required.

More information about this program can be found in either the Community Facilities Guaranteed Fact Sheet for Borrowers or the Community Facilities Guaranteed Fact Sheet for Lenders.

To apply, Contact our State Office or click here for application materials.

 

Community Facilities Direct Loans

Community Facilities Direct Loans and Grants provide funding for essential community facilities (CF), such as municipal buildings, day care centers, and health and safety facilities. Examples include fire halls, fire trucks, clinics, nursing homes, and hospitals. CF loans and grants may also be used for such things as activity centers for the handicapped, schools, libraries, and other community buildings. Applicants must be unable to borrow money elsewhere at rates and terms to make the project affordable. Leveraging is highly recommended due to limited CF allocations.

Applicants are public bodies (cities, townships, counties, or special districts), Indian Tribes, cooperatives, or other non-profit organizations. Based on 2010 Census, cities and villages must be under 20,000 in population for loans and grants. Grant recipients must have a median household income below $50,795. Applicants, other than municipalities, must show broad based community support. Applications are scored on a priority point system based upon population, median household incomes, and if health and safety needs are being met by the proposal. The amount of grant funds provided for a facility shall not exceed 75% of the cost of developing the facility. Grants are limited to no more than 50% of the State allocation or $50,000, whichever is greater. Maximum loan term is for 40 years or the useful life of the security, whichever is less.  The interest rate is dependent on the median household income of the borrower. The lowest current rate is 4.50%. Collateral is usually a revenue bond, if the loan is to a public body, otherwise a note and a mortgage. Repayment is from revenue use of the facility and backed by taxes if a public body.

More information about this program can be found in the Community Facilities Direct Brochure.

To begin the application process, download the Community Facilities Direct Pre-Application.