Water and Waste Direct Loan and Grant Program

What is the purpose of the program? Who is eligible to apply? How can funds be used? How much assistance can our group apply for?           What are the rates and terms? What are the security requirements? When can we apply for assistance? How will our application be evaluated? How do we apply?

What is the purpose of the program?  return to top
The Water and Waste Direct Loan and Grant program is designed to assist in the development of water and waste systems in financially needy rural communities, resulting in reasonable user costs for rural residents and businesses.

Who is eligible to apply?  return to top

• Eligible organizations include:
• Community based non-profit corporations
• Public bodies, such as municipalities, counties, and special purpose districts
• Federally recognized Native American Tribes
• Facilities must be located in rural areas with less than 10,000 residents.

How can funds be used under this program?  return to top

• Funds can be used for:
• Purchase, construct, enlarge, extend and/or improve rural drinking water, sanitary sewage, solid waste disposal, and storm wastewater disposal facilities
• Purchase major equipment related to the project
• Pay related project expenses, such as legal, engineering, architectural, and environmental fees
• Examples of recently funded projects:

How much assistance can our group apply for?  return to top

• Maximum loan limits are determined by project feasibility.
• Grant funds are limited to the amount needed to result in reasonable user costs for those communities whose median household income is equal to or below the statewide nonmetropolitan median household income.

What are the rates and terms of this financial assistance?  return to top

• Interest rates are fixed and are based on the median household income of the service area and the type of project. Contact your local Rural Development Office to determine the interest rate for your area.
• Loan repayment terms may not exceed the applicant's authority (under state law or organizational structure), the useful life of the facility, or a maximum of 40 years. Where grant funds are used, the loan will be for the maximum term permitted.

What are the security requirements of this financial assistance?  return to top

• Loans will be secured by the best security position available, and must be adequate to protect the Government's interest during the lifetime of the loan.
• Security can include the following:

           General obligation bonds                               Revenue bonds
           Pledges of taxes or assessments                    Assignment of facility revenue
           Land and buildings                                        Machinery and equipment
           Accounts Receivable                                    Assignments of leases or leasehold interest

When can we apply for assistance?  return to top

• Applications are accepted year round.

How will our application be evaluated?  return to top

• Population of the area served
• Income of the area served
• Reason project is needed
• Amount of leveraged funds
• Request for construction cost overruns on previously approved projects

How do we apply?  return to top

• Applicants are strongly encouraged to contact their local Rural Development Office to discuss potential projects.
• Rural Development Application materials are available online.

Please send any comments or suggestions to:
keith.bastow@ia.usda.gov
Iowa Rural Development
Revised on: April 15, 2008