PROGRAM
DESCRIPTION: Funds are for essential
community facilities (CF) with emphasis on day care and health and safety
facilities. Examples include day care centers, 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.
TYPE OF ASSISTANCE: Applicant
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. The amount of grant funds provided for a facility shall not
exceed 75 percent of the cost of developing the facility. Grants are also
limited to the amount needed for financial feasibility and no more than 50
percent of the State allocation or $50,000, whichever is greater.
ELIGIBILITY REQUIREMENTS: Applicants
are public bodies (city, township, county or special district), Indian
tribes, cooperatives, or other non-profit organizations. The service area
must be under 20,000 in population for loans and grants. Grant recipients
must have a median household income below $42,993 (2000 census).
FUND AVALIABILITY: Applications
are scored on a priority point system based upon population, median
household incomes, targeted areas as defined in the State Strategic Plan,
and if health and safety needs are being met by the proposal. In addition,
the State Director may also assign up to 15 discretionary points to the
proposal.
INTEREST RATE: Loan
interest rate depends upon the median household income of the borrower.
The rate can be as low as 4.5 percent and will usually be no higher than
commercial bonds.
TERM:
Loan term is up to the useful life of the security or 40 years, whichever
is less.
COLLATERAL: Collateral
is usually a general obligation bond if the loan is to a public body,
otherwise a note and mortgage. Repayment is from revenue from use of the
facility, and backed by taxes if a public body.
CONTACT: Visit
your local USDA Rural Development office to apply.
Minnesota
