Rural Utilities Service Implementation of the SUTA Initiative

The Rural Utilities Service (RUS), a Rural Development policy, planning and lending agency of the USDA is implementing the Substantially Underserved Trust Area ("SUTA") provisions of the Food, Conservation & Energy Act of 2008 (2008 Farm Bill). The SUTA provisions give the RUS new tools to finance improvements in electric, telecommunications, water and sewer infrastructure in underserved tribal communities.

The statute gives the RUS discretionary authority to offer interest rates as low as 2%; waive non-duplication requirements; waive matching or credit support requirements; extend repayment terms and give eligible applications the highest funding priority when projects serve substantially underserved trust territories.

On October 14, 2011, RUS issued a proposed rule affecting RUS loans and grants to construct, acquire, or improve utility infrastructure in substantially underserved trust areas. The proposed rule is designed to implement Section 906 F of the Rural Electrification Act (7 U.S.C. 960f) by providing a process for eligible applicants to request SUTA consideration. A link to the rule’s federal register notice is below. The agency has set January 17, 2012 as the deadline for comments on the proposed rule.

SUTA provisions have been in effect since March 2011 for the RUS broadband loan program. The proposed rule would extend discretionary SUTA authorities to the RUS Electric, Telecommunications, Broadband, and Water and Environmental Programs.

Implementation of the SUTA provision is critical to USDA’s broader efforts to make all programs more accessible to tribal governments and communities, residents of Hawaiian homelands, Alaskan Natives, and Pacific Islanders.

SUTA implementation is part of a long-term strategy to assist tribes in meeting their unique utility infrastructure needs and improve economic development and quality of life.

RUS and Rural Development officials conducted over 30 tribal consultations on the SUTA provision prior to proposing a rule to implement SUTA. The consultation process was very informative and helped enhance the agency’s relationship with federally recognized tribes. The SUTA consultations also demonstrated USDA’s commitment to President Obama’s November 5, 2009 Memorandum on Tribal Consultation, which stated that tribal consultation is “a critical ingredient of a sound and productive Federal-tribal relationship.”

The Secretary of Agriculture has delegated the authority to implement the SUTA initiative to the RUS Administrator. Comments on the proposed SUTA regulation may be filed electronically through http://www.regulations.gov. Simply follow the instructions for submitting comments or you may send your comments by mail to: Michele Brooks, Director, PDRA, USDA Rural Development, 1400 Independence Avenue, STOP 1522; Room 5159, Washington, DC 20250–1522.

SUTA-related Documents

If you would like more information about RUS or other USDA Rural Development Programs please contact Tedd Buelow, Native American Coordinator, USDA Rural Development at tedd.buelow@wdc.usda.gov. You can also mail questions and suggestions to Mr. Buelow atUSDA Rural Development, Attention: Tedd Buelow, Denver Federal Center, Building 56, Room 2300, PO Box 25426, Denver, CO 80225-0426. Tedd can be reached by phone at (720) 544-2911.