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Business Programs | Cooperative Development Programs | Homeownership Programs | Rental Housing Programs | Community Facilities Programs | Water and Waste Program | Telecommunications Program | Electric Program | Management Initiatives | Resource Summaries
Telecommunications leverage ratio is available from RUS form 479, Part F, Funds Invested in Plant During Year. The ratio is derived using total non-RUS loan funds expended for telecommunications plants versus RUS loan funds expended for the same period. Information on the number Schools receiving transmission facilities for DL applications comes from RUS Form 493c, Loan Funds data. (Information collected from the loan design, submitted with the application, and compiled in RUS Form 493c for each borrower).
While this information is provided by the applicant and is not subject to audit, it is considered to be sufficiently accurate for management’s purposes and for the purposes for which it is being used.
Electric Distribution Direct Loans. These loans are made to finance electric distribution facilities. The interest rates are tied to the economic conditions of the areas served and the costs of providing service to that area. Most loans are made at an interest rate tied to a published index of municipal interest rates. Most RUS-financed systems eligible for the municipal rate loans are also eligible to have their interest rate capped at 7 percent. RUS-financed systems that serve in more distressed areas can qualify for loans at a hardship rate of 5 percent. Factors taken into account include consumer density, extremely high residential rates or large rate disparity, and per capita income levels. RUS electric borrowers provide service in the vast majority of the poorest non-metropolitan counties and the non-metropolitan counties experiencing the greatest out-migration.
RUS provides only part of the financing needs for most distribution systems. The borrower obtains the balance from the private sector. Generally, borrowers supply approximately 50 percent of their capital needs with internally generated funds. Of their remaining capital needs, RUS provides approximately 70 percent and the private sector provides 30 percent. RUS has recently streamlined procedures for sharing the Government’s lien to better accommodate these systems.
Guaranteed Loans. RUS guarantees loans made by the Federal Financing Bank (FFB), CoBank -National Bank for Cooperatives and National Rural Utilities Cooperative Finance Corporation (CFC) to finance electric generation, transmission and distribution facilities. The interest rate on FFB loans is based on the Treasury’s cost of money plus 1/8 percent. Most loans are made for 35 years and are secured by the borrower’s electric system assets. In order to ensure the availability of capital to maintain their electric infrastructure, many borrowers apply for RUS loans every few years.
Program Activity: Electric Program | FY 1998 | FY 1999 | FY 2000 | FY 2001 |
|---|---|---|---|---|
Program Level | $925m | $1.566b | $2.115b | $1.550b |