USDA Rural Development - Iowa Busines and Cooperative Programs

Committed to the future of rural communities

Iowa

Business - Cooperative Programs www.rurdev.usda.gov/rbs/index.html (Click on the program title to go to the fact sheet for more information)

Program Objective Applicant Uses Population Loan/Grant Terms/
Conditions

Business and Industry Guarantee Loans Create jobs and stimulate rural economies by providing financial backing for rural businesses. Business applies through Federal or State Chartered banks, credit unions, savings & loan associations. Most legal business purposes including acquisition, start-up and expansion of businesses that create rural employment. All areas except cities of more than 50,000 and their contiguous and adjacent urbanized area. Loan guarantee Lender and borrower negotiate terms Interest rate tied to published rate that may change no more often than quarterly.

Rural Business Enterprise Grants Finance and facilitate the development of small and emerging private business enterprises. Public bodies; private nonprofit corporations and federally recognized Native American tribal groups apply to Rural Development. Buy and develop land, construct buildings, plants, equipment, access streets and roads, parking areas, utility and service extensions, rural distance learning networks, and establish a revolving loan. All areas except cities of more than 50,000 and their contiguous and adjacent urban or urbanizing areas. Grant When grant funds are used for revolving loan fund (RLF) the intermediary makes loans to businesses from its RLF on terms consistent with security offered.

Intermediary Relending Program Loans Finance business facilities and community development projects in rural areas. Public bodies, nonprofit corporations, Native American tribes, and cooperatives apply to Rural Development. Community development projects, establishment or expansion of businesses, creation or saving rural jobs. Rural areas and incorporated places with populations of less than 25,000. Direct loan The intermediary makes loans to businesses from its revolving loan fund on terms consistent with security offered. Intermediary pays 1% for 30 years.

Rural Economic Development Loans and Grants Finance economic development and job creation in rural areas. Rural Electric and Telephone Cooperatives who are RUS (Rural Utility Service) borrowers. Business startup or expansion projects that create rural jobs. Rural areas. Places with populations of 2,500 or less receive priority. Direct loan and revolving loan fund grant. The intermediary, electric or telephone utilities, make loans to profit or non-profit business and public bodies for rural economic development and/or job creation projects. 0% Loans - 10 yrs.

Rural Cooperative Development Grants Establish and operate centers for cooperative development to improve the economic condition of rural areas through the development of new cooperatives and improving operations of existing cooperatives. Nonprofit corporations and institutions of higher education apply directly to Rural Development National Office. Establish operating centers for development of rural cooperatives. All areas. Grant Applicants must meet specific selection criteria including a minimum 25 percent fund match. Grants are awarded on a competitive basis. Some funds reserved for applicants that focus on assistance to small, minority producers through their cooperative businesses (governing board or membership at least 75 % minority).

Value-Added Agricultural Product Market Development Grant Program To assist independent agricultural producers enter into value-added activities. Independent producers,farmer and rancher cooperatives, agricultural producer groups, and majority-controlled producer-based business ventures- apply to RD State Office. Funds can be used for planning purposes such as conducting feasibility studies or feasibility business plans or it can be used as working capital to help start the operations of a venture. All areas Grant Applicants must meet specific selection criteria. Grants are awarded on a competitive basis. Funds cannot be used to build facilities or purchase equipment. There is a dollar for dollar matching requirement.

Rural Business Opportunity Grant Finance technical assistance for business development planning in rural areas. Public bodies, non-profit corporations, Indian tribes on Federal or state reservations and cooperatives with members that are primarily rural residents. Technical assistance, leadership training, establish business support centers, economic development plans. All areas except cities of more than 50,000 and their contiguous and adjacent urbanized area. Grant Applicants must meet specific selection criteria. Grants are awarded on a competitive basis. Funds cannot be used to build facilities or purchase equipment. There is a dollar for dollar matching requirement.

Renewable Energy Systems and Energy Efficiency Improvements Program To reduce energy costs and consumption. Ag producers and small businesses. Equipment, construction or improvements, energy audits, permit & professional fees, feasibility studies, business plans, and retrofitting. All areas except cities of more than 50,000 and their contiguous and adjacent urbanized area. Grants, eventually loans and loan guarantees. Grant will not exceed 25% of eligible project costs with $2,500 minimum with maximum of $500,000 renewable energy and $250,000 energy efficiency.

Summary of Purposes for Business - Cooperative Programs

A bullet in the table below indicates program funds may be used for that purpose.

Program Program Use of Funds Purpose

Land & Building Machinery & Equipment Working Capital Infrastructure Training/
Technology

Business & Industry - Guaranteed loan

Rural Business Enterprise Grant

Intermediary Relending – Loan

Rural Economic Development Loan

Rural Economic Development Grant

Rural Cooperative Development Grant

Value-Added Producer Grants

Rural Business Opportunity Grant

Renewable Energy Systems and Energy Efficiency Improvements Program

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Please send any comments or suggestions to:
keith.bastow@ia.usda.gov
Iowa Rural Development
Revised on: Fefruary 16, 2005

Program	Objective	Applicant	Uses	Population	Loan/Grant	Terms/ Conditions
Business and Industry Guarantee Loans	Create jobs and stimulate rural economies by providing financial backing for rural businesses.	Business applies through Federal or State Chartered banks, credit unions, savings & loan associations.	Most legal business purposes including acquisition, start-up and expansion of businesses that create rural employment.	All areas except cities of more than 50,000 and their contiguous and adjacent urbanized area.	Loan guarantee	Lender and borrower negotiate terms Interest rate tied to published rate that may change no more often than quarterly.
Rural Business Enterprise Grants	Finance and facilitate the development of small and emerging private business enterprises.	Public bodies; private nonprofit corporations and federally recognized Native American tribal groups apply to Rural Development.	Buy and develop land, construct buildings, plants, equipment, access streets and roads, parking areas, utility and service extensions, rural distance learning networks, and establish a revolving loan.	All areas except cities of more than 50,000 and their contiguous and adjacent urban or urbanizing areas.	Grant	When grant funds are used for revolving loan fund (RLF) the intermediary makes loans to businesses from its RLF on terms consistent with security offered.
Intermediary Relending Program Loans	Finance business facilities and community development projects in rural areas.	Public bodies, nonprofit corporations, Native American tribes, and cooperatives apply to Rural Development.	Community development projects, establishment or expansion of businesses, creation or saving rural jobs.	Rural areas and incorporated places with populations of less than 25,000.	Direct loan	The intermediary makes loans to businesses from its revolving loan fund on terms consistent with security offered. Intermediary pays 1% for 30 years.
Rural Economic Development Loans and Grants	Finance economic development and job creation in rural areas.	Rural Electric and Telephone Cooperatives who are RUS (Rural Utility Service) borrowers.	Business startup or expansion projects that create rural jobs.	Rural areas. Places with populations of 2,500 or less receive priority.	Direct loan and revolving loan fund grant.	The intermediary, electric or telephone utilities, make loans to profit or non-profit business and public bodies for rural economic development and/or job creation projects. 0% Loans - 10 yrs.
Rural Cooperative Development Grants	Establish and operate centers for cooperative development to improve the economic condition of rural areas through the development of new cooperatives and improving operations of existing cooperatives.	Nonprofit corporations and institutions of higher education apply directly to Rural Development National Office.	Establish operating centers for development of rural cooperatives.	All areas.	Grant	Applicants must meet specific selection criteria including a minimum 25 percent fund match. Grants are awarded on a competitive basis. Some funds reserved for applicants that focus on assistance to small, minority producers through their cooperative businesses (governing board or membership at least 75 % minority).
Value-Added Agricultural Product Market Development Grant Program	To assist independent agricultural producers enter into value-added activities.	Independent producers,farmer and rancher cooperatives, agricultural producer groups, and majority-controlled producer-based business ventures- apply to RD State Office.	Funds can be used for planning purposes such as conducting feasibility studies or feasibility business plans or it can be used as working capital to help start the operations of a venture.	All areas	Grant	Applicants must meet specific selection criteria. Grants are awarded on a competitive basis. Funds cannot be used to build facilities or purchase equipment. There is a dollar for dollar matching requirement.
Rural Business Opportunity Grant	Finance technical assistance for business development planning in rural areas.	Public bodies, non-profit corporations, Indian tribes on Federal or state reservations and cooperatives with members that are primarily rural residents.	Technical assistance, leadership training, establish business support centers, economic development plans.	All areas except cities of more than 50,000 and their contiguous and adjacent urbanized area.	Grant	Applicants must meet specific selection criteria. Grants are awarded on a competitive basis. Funds cannot be used to build facilities or purchase equipment. There is a dollar for dollar matching requirement.
Renewable Energy Systems and Energy Efficiency Improvements Program	To reduce energy costs and consumption.	Ag producers and small businesses.	Equipment, construction or improvements, energy audits, permit & professional fees, feasibility studies, business plans, and retrofitting.	All areas except cities of more than 50,000 and their contiguous and adjacent urbanized area.	Grants, eventually loans and loan guarantees.	Grant will not exceed 25% of eligible project costs with $2,500 minimum with maximum of $500,000 renewable energy and $250,000 energy efficiency.

Program	Land & Building	Machinery & Equipment	Working Capital	Infrastructure	Training/ Technology
Program	Program Use of Funds Purpose
Business & Industry - Guaranteed loan
Rural Business Enterprise Grant
Intermediary Relending – Loan
Rural Economic Development Loan
Rural Economic Development Grant
Rural Cooperative Development Grant
Value-Added Producer Grants
Rural Business Opportunity Grant
Renewable Energy Systems and Energy Efficiency Improvements Program