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Catalog of Federal Domestic Assistance

Program Descriptions

10.854:  Rural Economic Development Loans and Grants

Objectives:  To promote rural economic development and job creation projects, including funding for project feasibility studies, start-up costs, incubator projects, and other reasonable expenses for the purpose of fostering rural development.

PROGRAM AND AWARD	FINANCIAL AND INFORMATION CONTACTS
ELIGIBILITY REQUIREMENTS	FINANCIAL AND ADMINISTRATIVE INFO.
APPLICATION AND AWARD PROCESS	INFORMATION CONTACTS
RELATED PROGRAMS	ASSISTANCE CONSIDERATIONS
PROGRAM ACCOMPLISHMENTS	POST ASSISTANCE REQUIREMENTS

10.854 ELIGIBILITY REQUIREMENTS:

Applicant Eligibility:  Electric and phone utilities that have current loans with the Rural Utilities Service (RUS) or Rural Phone Bank loans or guarantees outstanding and are not delinquent on any Federal debt or in bankruptcy proceedings.

Beneficiary Eligibility:  Rural/General Public.

Credentials/Documentation:  This program is excluded from coverage under OMB Circular No. A-87.

10.854 APPLICATION AND AWARD PROCESS:

Preapplication Coordination:  Application Form: OMB Standard form 424. This program except for feasibility studies is eligible for coverage under E.O. 12372 "Intergovernmental Review of Federal Programs." The RUS utility should consult the office or official designated as the single point of contact in his or her State for more information on the process the State requires to be followed in applying for assistance, if the State has selected the program for review. This program is excluded from coverage under OMB Circular No. A-102. An environmental review is conducted by the agency for the projects. An environmental assessment without scooping is occasionally required.

Application Procedure:  Submit application as described in 7 CFR 1703.34, no State plan required.

Award Procedure:  RBS selects projects to be funded. The funds pass through the RUS utility to rural economic development projects.

Deadlines:  Applications may be filed on any working day during the month.

Range of Approval/Disapproval Time:  Open ended.

Appeals:  Not applicable.

Renewals:  Renewal of same application for one year. Submit new or revised application as often as desired.

Criteria for Selecting Proposals:  See 7 CFR 1703.46.

Examples of Funded Projects:  Establishment or expansion of factories or businesses, medical facilities, industrial development parks, business incubators for rural economic development activities and other job creation projects. Grants were used to establish revolving loan funds.

Range and Average of Financial Assistance:  (Loans) for FY 1999, $10,000 to $450,000; $375,000 average. (Grants) for FY 1999, $10,000 to $330,000; $260,000 average. Maximum limits for FY 2000: Loans $450,000; Grants $200,000.

10.854 RELATED PROGRAMS:

None.

10.854 PROGRAM ACCOMPLISHMENTS:

From May 1989 to September 30, 1999, 564 loans totaling $120,338,000 and 208 grants totaling $63,486,865 were made. They created 24,498 jobs and were leveraged with $1.02 billion in supplemental capital.

10.854 FINANCIAL AND ADMINISTRATIVE INFO:

Federal Agency:  RURAL BUSINESS-COOPERATIVE SERVICE, (DEPARTMENT OF AGRICULTURE )

Type of Assistance:  Direct Loans; Project Grants.

Obligations:  (Loans) FY 99 $15,000,100; FY 00 est $15,000,000; and FY 01 est $15,000,000. (Grants) FY 99 $11,000,000; FY 00 est $4,000,000; and FY 01 est $4,000,000. (Note: Grants to establish Revolving Loan Fund Programs.)

Budget Account Number:  12-4230-0-3-271; 12-3108-0-1-452; 12-3105-0-1-452.

Authorization:  Rural Electrification Act of 1936, as amended, Title III, 7 U.S.C. 930-940c.

Regulations, Guidelines, and Literature:  7 CFR 1703, Subpart B and the Rural Electrification Act of 1936.

10.854 INFO CONTACTS:

Regional or Local Office:  Consult your local phone directory for RD District Office number. If no listing, get in touch with appropriate Rural Development State Office listed in Appendix IV of the catalog.

Headquarters Office:  Director, Specialty Lenders Division, Rural Business-Cooperative Service, Department of Agriculture, Washington, DC 20250. Phone: (202) 720-1400. Use the same number for FTS. (Home Page)

(See Appendix IV for more contact info.)

10.854 ASSISTANCE CONSIDERATIONS:

Formula and Matching Requirements:  This program requires supplemental funds in the amount of 20 percent of the RBS application amounts.

Length and Time Phasing of Assistance:  Not applicable.

Uses and Use Restrictions:  Projects which promote rural economic development and job creation. For fiscal year 2000, maximum amount of grant is $200,000; maximum amount of loan is $450,000. Maximum term of loan is ten years at zero interest rate.

10.854 POST ASSISTANCE REQUIREMENTS:

Reports:  Reporting need established in 7 CFR 1703, Subpart B.

Audits:  Financial audit of the RUS utility is required.

Records:  Record retention requirements established in 7 CFR 1703, Subpart B.