Business & Cooperative Programs

The goal of Rural Development, Business and Cooperative Programs (BCP) is to promote a dynamic business environment in rural America. Business Programs work in partnership with the private sector and the community-based organizations to provide financial assistance and business planning. These programs help fund projects that create or preserve quality jobs and/or promote a clean rural environment. The financial resources of Business and Cooperatives Programs are often leveraged with those of other public and private credit source lenders to meet business and credit needs in under-served areas. Recipients of these programs may include individuals, corporations, partnerships, cooperatives, public bodies, nonprofit corporations, Indian tribes, and private companies.

Business & Industry Guaranteed Loan

Rural Business Enterprise Grant

Rural Business Opportunity Grant

Intermediary Relending Program

Rural Cooperative Development Grant

Rural Economic Development Loan & Grant

Value Added Producer Grant

Renewable Energy/Energy Efficiency

For additional information regarding ARRA (American Recovery and Reinvestment Act) see website: http://www.rurdev.usda.gov/recovery.html

Utah Business & Cooperative Contacts

Perry Mathews, Program Director
125 South State Street, Rm 4311
Salt Lake City, UT
Phone: (801) 524-4328 | Fax: (801) 524-4306
perry.mathews@ut.usda.gov

Lori Silva, Specialist
125 South State Street, Rm 4311
Salt Lake City, UT
Phone: (801) 524-4323 | Fax: (801) 524-4306
lori.silva@ut.usda.gov

LuAnn Wilson, Specialist
125 South State Street, Rm 4311
Salt Lake City, UT 84642
Phone: (801) 524-4322 | Fax: (801) 524-4306
luann.wilson@ut.usda.gov

Business and Industry (B&I) Guaranteed Loan

The Business and Industry (B&I) Guaranteed Loan program (See Fact Sheet) provides up to an 80% guarantee on traditional lender loans to businesses. Benefits to businesses include increased flexibility on rates and terms of local lender loans. By utilizing the secondary market, banks can offer long term fixed rate terms.

Businesses may use loan proceeds for working capital, machinery and equipment, buildings and real estate, and for certain types of debt refinancing.

B&I loans are normally available in rural areas, which include all areas other than cities & towns of more than 50,000 people and the contiguous and adjacent and urbanized area of such cities and towns.

The maximum loan amount is $10 million. However, loans of up to $25 million can be guaranteed with prior approval from the National Business Programs Administrator. Businesses in operation less than one year must provide a a proforma tangible balance sheet equity, (appraisal surplus and subordinated debt will not be included as equity items) of 20%. Existing businesses must provide 10%.

Here is a program comparison (Adobe™ PDF) between the REAP program and the B&I Guarantee program, as well as a list of regular program lenders.

For more information on this or any program offered by Rural Development, please contact your nearest Area Office.

Rural Business Enterprise Grant

The Rural Business Enterprise Grant (RBEG) program provides grants for development of revolving loan funds and to provide technical assistance to small emerging private businesses. Public bodies, nonprofit development corporations, and Federally-recognized Indian Tribal groups are eligible to apply for funds to help businesses located in areas outside any city with a population of 50,000 or more.

The following are eligible for financing through grant funds:

• Aquisition and development of land, easements, and rights-of-way.
• Construction, conversion, enlargement, repairs or modernization of building, plants, machinery, equipment, access streets and roads, parking areas, utilities, and pollution control & abatement facilities.
• technical assistance and training associated with technical assistance
• revolving loan funds
• fees for professional services
• startup operating costs and working capital as part of the revolving loan fund
• production of television programs to provide information to rural residents

For more information on this or any program offered by Rural Development, please contact your nearest Area Office.

Rural Business Opportunity Grant

The Rural Development Business Opportunity Grant (RBOG) program provides grants to conduct area-wide economic development planning. Public bodies, nonprofit development corporations, Federally recognized Indian Tribes, and rural cooperatives are eligible to apply for funds.

Eligible rural areas are those communities with 50,000 or less population. Maximum grant applications in years past were $50,000.

For more information on this or any program offered by Rural Development, please contact your nearest Area Office.

Intermediary Relending Program

The Intermediary Relending Program (IRP) provides one percent loans to nonprofit development organizations for establishment of revolving loan programs for loans to small businesses. Applications from each state are selected for funding through a nationwide competition. Assistance through the IRP program is limited to areas with a population of less than 25,000.

To be eligible for assistance, the nonprofit development corporations (intermediaries) and their loan applicants must be unable to obtain financing elsewhere at reasonable rates and terms. Additional loans can be requested until the maximum loan amount to intermediaries is determined each fiscal year. The maximum loan amount in years past was $750,000.

Intermediaries can use the funds to make loans of up to $250,000 to private or public organizations and other local businesses.

For more information on this or any program offered by Rural Development, please contact your nearest Area Office.

Rural Cooperative Development Grant

Nonprofit corporations and higher education institutions are eligible for assistance through the Rural Cooperative Development Grant (RCDG) program. Grant financing can be used to fund up to 75% of the cost required to carry out identified projects.

To be eligible, projects must benefit cooperative development projects through businesses or cooperatives in rural areas. Grants for establishing and operating centers for rural technical or cooperative development are the primary purpose of the program.

Grant funds may be used to:

• finance applied research, feasibility, environmental, or other studies
• finance collection, interpretation, and dissemination of principles, facts, or technical knowledge
• provide training and instruction
• provide loans and grants
• provide technical assistance, research services, and advisory services

For more information on this or any program offered by Rural Development, please contact your nearest Area Office.

Rural Economic Development Loan & Grant

The Rural Economic Development Loan & Grant (REDLG) program provides zero percent interest rate loans or grants to rural telephone and electric cooperatives for economic development projects in rural areas.

Like the IRP, the REDLG applications go through a nationwide competition for funding. The maximum amount of loan or grant assistance is established each fiscal year. In years past, the maximum loan was $760,000 and the maximum grant was $340,000.

The cooperatives use the grant funding to establish revolving loan programs or provide technical assistance to local business or community projects.

The cooperatives use the zero interest loan to re-loan to a business or other economic development project. The terms on the re-loaned funds are zero percent interest and 10 years repayment.

For more information on this or any program offered by Rural Development, please contact your nearest Area Office.

Value Added Producer Grant

Grants may be used for planning activities and for working capital for marketing value-added agricultural products and for farm-based renewable energy. Eligible applicants are independent agriculture producers, farmer and rancher cooperatives, agricultural producer groups, and majority-controlled producer-based business ventures. The producer who is adding value to the product must produce the majority of the product themselves. All grants require a 50% match from the producer.

For more information on this or any program offered by Rural Development, please contact your nearest Area Office.

Rural Energy for America Program - Loans and Grants

This program, originally authorized in the 2002 Farm Bill and reauthorized in 2008, is a program to help farmers, ranchers and rural small businesses purchase renewable energy systems and make energy efficiency improvements. This is done by offering a grant not to exceed 25% of the total cost of the project and a guarantee of a commercial loan not to exceed 50% of the total cost of the project.

Here is a program comparison (Adobe™ PDF) between the REAP program and the B&I Guarantee program.

For more information on this or any program offered by Rural Development, please contact your nearest Area Office.