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Description:

This grant program is used to support the development of small emerging private business enterprises in rural areas. A rural area can include all the territory in a state that is not within the outer boundary of any city having a population of 50,000 or more and its immediately adjacent urbanized and urbanizing area. Small and emerging businesses would generally employ 50 or fewer new employees and have less than $1,000,000 in projected annual gross revenues. 

Who Is Eligible?

These grants can be made to public bodies and private nonprofit corporations that serve rural areas. Applications will be scored and will compete for funding based on supporting documentation related to the service area's population and economic conditions, the applicant's rural development experience, commitments of qualifying business establishment/expansion, non-federal funds committed to the project, and most importantly, the creation of jobs.  For-profit companies cannot apply directly for funding under this program.

Grants, except those for television demonstration programs, will only be made when there is a reasonable prospect that they will result in "development" (job creation) of small/emerging private business enterprises. 

Grant Purposes:

Grant funds must be used to finance and develop small and emerging private business enterprises in rural areas. The following 
is a list of some of the eligible purposes: 

1.    Acquisition and development of land, easements, and rights-of-way.
2.    Construction, conversion, enlargement, repairs or modernization of buildings, plants, machinery, equipment, access streets and roads, parking areas, utilities, and pollution control and abatement facilities.
3.    Providing financial assistance to third parties through a loan, which could include loans for start-up operating cost and working capital.
4.    Technical assistance (problem solving function) for an existing small business wishing to expand, which, if positively resolved, will result in growth/expansion and job creation and, training, when necessary, in conjunction with the technical assistance.
5.    Reasonable fees and charges for professional services necessary for the planning and development of the project including packaging.     Services must be provided by individuals licensed in accordance with appropriate state accreditation associations.
6.    Refinancing of debts exclusive of interest incurred by or on behalf of an association before an application for a grant when all of the following conditions exist:

    a.     The debts were incurred for the facility or service to be installed or improved with the grant.
    b.    Arrangements cannot be made with the creditors to extend or modify the terms of the existing debt.

7.    Creation, expansion, and operation of rural distance learning networks or rural learning programs that provide educational instruction or job training instruction related to potential employment or job advancement for adult students.

What Can You Not Do With These Funds?

* To produce agriculture products through growing, cultivation, and harvesting either directly or through horizontally integrated livestock operations except for commercial nurseries, timber operations, or limited agricultural production related to technical assistance projects.
* To finance comprehensive type planning. This does not preclude the use of grant funds for planning for a given project.
* For loans by grantees when the rates, terms, and charges for these loans are not reasonable or the loans would be for ineligible purposes as described above.
* For programs operated by cable television systems.
* To fund a part of a project which is dependent on another funding source unless there is a firm commitment to ensure completion of the project.

Other Criteria:

Applicants for grants to establish a revolving loan fund must include details about the applicant's experience operating a 
revolving loan fund, proposed projects, applicant's financial ability to administer the fund, and plans for leveraging.

FY 2007 Allocation

FY 2007 applications are not being accepted.  Applications for this year were due in by March 1, 2007..

Grant Amount:

Based on need and availability of funds. Generally, grant requests for less than $100,000 qualify for the maximum number of priority 
points. 

Where Do You Apply?

Individuals may contact their local Rural Development Area Office. To obtain additional information and/or to request an 
application, please click here

Last Updated : August 15, 2007