Rural Economic Development Loan Program:
PURPOSE
The Rural Economic
Development Loan Program provides zero interest loans to electric and telephone
utilities to re-lend loan monies in rural communities to promote rural economic
development and job creation projects.
ELIGIBILITY
Community Program electric & telephone utilities not delinquent on any federal debt or in bankruptcy proceedings.
INELIGIBLE
Any electric or telephone purpose
Any electric or telephone operation
Paying salaries of any employee or owner of the utility or its affiliates
Any operations affiliated with the utility without prior written approval
Retiring or refinancing any project debt incurred prior to receipt of the completed application by Rural Business & Cooperative Program Office
Project costs incurred prior to receipt of a complete application by the Rural Business & Cooperative Program Office
Projects located in areas covered by the Coastal Barrier Resources Act or projects which would adversely impact the environment
Purchasing community television antenna systems or facilities unless in conjunction with educational or medical entities and projects
Any purchase or lease of any real property, materials, equipment or services from the Community Program’s electric or telephone utility or significant stockholders, officers, managers, or close relatives thereof without the Rural Business & Cooperative Program Administrator’s prior written approval
Any project in which any electric or telephone utility director, officer, manager, stock-holder, or relative thereof has an ownership interest or which would, in the judgment of the Rural Business & Cooperative Program Administrator, present a potential for or the appearance of a conflict of interest
FUND USE
Business Startups
Incubator Projects
Business Expansions
Project Feasibility Studies
Projects resulting in job creation & economic growth in rural communities
RATES
Zero-interest loan
TERMS OF REPAYMENT
Principle repayment may be deferred for a period of up to two years by Rural Business & Cooperative Program
Repayment terms on a loan to a utility are based on the nature of the project. Ordinarily, the term, including any principle deferment period, will not exceed ten years
MAXIMUM LIMITS
3 percent of projected total funds available during the fiscal year rounded to the nearest $10,000
RESTRICTIONS
Supplemental funding may be provided by the project owner in the form of cash, private sources, state and local government sources, or the Community Programs utility
A project will not be selected unless supplemental funding is provided in an amount equaling at least 20 percent of the amount of the zero-interest loan funds provided by the Rural Business & Cooperative Program
APPLY TODAY
To get started
today contact the USDA Rural Development –