Media Contact: LaJaycee Brown (202) 720-9741
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Public Contact: Dan Campbell (202) 720-6483
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USDA AND CFC TEAM UP TO EXPAND RURAL BUSINESS OPPORTUNITIES
WASHINGTON, May 5, 1999--Agriculture Under Secretary for Rural Development Jill Long Thompson today announced a new partnership with the National Rural Utilities Cooperative Finance Corporation (CFC) to help increase the number of business development projects in rural areas. The agreement will enable CFC members to participate in USDA's Business and Industry (B&I) Guaranteed Loan Program.
"By signing this Memorandum of Understanding, Rural Development will work through CFC's cooperative network to reach some of America's most needy rural communities," said Long Thompson. "This new partnership will spur business development, and we at USDA are excited that we can contribute."
CFC is a cooperative association formed by rural electric cooperatives and has been making loans specifically for rural development purposes for over a decade. CFC will provide the funding for loans made by their member cooperatives, with USDA Rural Development providing a guarantee on that loan through its B&I program.
"Cooperatives continue to play a vital role in improving the economic conditions in rural America," said Dayton Watkins, administrator for the Rural Business-Cooperative Service, the agency which administers the B&I program. "With the number of members in their association, the CFC in effect is providing an additional lender base for providing business loans in rural communities."
The B&I program provides loan guarantees that can be used for working capital, machinery and equipment, buildings and real estate, and debt refinancing. Maximum loan guarantees are: 80 percent for loans of $5 million or less; 70 percent for loans between $5 million and $10 million, and 60 percent for loans exceeding $10 million. The maximum loan amount is $25 million.
For your information on this program, contact your local Rural Development office.
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