What Is the Purpose of This Program?
This program offers reasonably priced funding for the construction of necessary Grants to Communities facilities in rural areas. A facility that offers a necessary service to the community for the orderly development of the community in a predominantly rural area is referred to as an essential community facility; private, commercial, or business endeavors are not included in this definition.
For This Program, Who May Apply?
Among the eligible borrowers are:
Governmental organizations
Neighborhood-based nonprofit organizations
Tribes with federal recognition
What Area Qualifies?
This program is available to rural areas, which include cities, villages, townships, and Federally Recognized Tribal Lands, with 20,000 or fewer residents based on the most recent U.S. Census data.
How Might Money Be Put To Use?
The money can be used to build, buy, or renovate necessary community facilities, buy equipment, or cover project-related costs.
Among the necessary community amenities are:
Healthcare facilities include assisted living communities, nursing homes, dental offices, and hospitals.
Town halls, courtrooms, airport hangars, and street upgrades are examples of public facilities.
Childcare facilities, community centers, fairgrounds, and transitional housing are examples of community support services.
Services related to public safety include fire departments, police stations, jails, police cars, fire trucks, and equipment for public works.
Services for education like libraries, museums, and private schools
Equipment for distance learning or telemedicine are examples of useful services.
Community gardens, food pantries, food banks, food hubs, food banks, and greenhouses are examples of local food systems.
See the Code of Federal Regulations, 7 CFR, Part 1942.17(d) for loans and 7 CFR, Part 3570.62 for grants, for an exhaustive list.
Which Types of Funding Are Offered?
Grants for low-interest direct loans
a mix of the previous two as well as our loan guarantee scheme. If all eligibility and feasibility requirements are satisfied, these may be paired with commercial financing to fund a single project.
Which Financial Priorities Exist?
Priority point system determined by median household income and population
tiny towns with fewer than 5,500 residents
Grants to Communities classified as low-income if their median household income is less than 80% of the state’s nonmetropolitan median.
Which Terms Are These?
Money is given out via a competitive procedure.
Straight Loan:
The length of the loan repayment terms cannot exceed 40 years, the facility’s useful life, state law, or the applicant’s authority, whichever is less.
Interest rates are set by Rural Development; contact us for current rates and further details.
The interest rate is determined for the life of the loan after it has been approved and is determined by the population of the community and the median household income of the service area.
There are no early payment penalties.
To find out more about the current interest rates that are relevant to your project’s grant approval, get in contact with us.
The applicant must be eligible for grant assistance, which is given out progressively; smaller communities with the lowest median household income are eligible for projects that receive a larger share of grant funds. Grants will only be available for the following percentages of eligible project costs: If the proposed project is located in a rural community with 5,000 or fewer residents and the median household income in the proposed service area is less than the federal poverty level or 60% of the state’s nonmetropolitan median household income, then a maximum of 75% will be applicable.
The Main Proposes of the Project
If the proposed project is located in a rural Grants to Communities with fewer than 12,000 residents and the median household income in the proposed service area is less than 70% of the federal poverty line or the state’s nonmetropolitan median household income, then a maximum of 55% will apply.
A Maximum Of 35 Percent In The Following Circumstances
The proposed service area’s median household income is 80 percent of the state’s nonmetropolitan median household income, or the project is located in a rural community with 20,000 or fewer residents.
15% at most in the following circumstances: the proposed service area’s median household income falls below 90% of either the federal poverty line or the state’s nonmetropolitan median household income, or the project is located in a rural community with 20,000 or fewer residents. The proposed project needs to meet both of these percentage requirements.
- There are additional restrictions on grants.
- There must be grant money accessible.
Do Any Other Prerequisites?
To borrow funds, obtain security, repay loans, and build, run, and maintain the proposed facilities, applicants must be legally authorized to do so.
The project Grants to Communities cannot be funded by the applicants using their own funds or commercial credit at fair interest rates and conditions.
The facilities where they are or will be located must serve the rural area.
The project needs to show strong community support.
The environmental review needs to be finished or approved.
How Do We Begin?
To discuss your unique project, get in touch with your local office.
We accept applications for this program all year long.
Online program resources are accessible (include necessary forms, guidance, and certifications)
If your company does not already have a Unique Entity ID number, request one. Getting your number shouldn’t take longer than a few working days.
If you haven’t already, register your Grants to Communities organization with the System for Award Management (SAM). It costs nothing to register, but there are a few steps you must take.
Who is qualified to respond to inquiries?
Speak with the local RD office.
What Rules This Particular Program?
Grants: 7 CFR Part 3570, Subpart A
Direct Loans: 7 CFR Part 1942, Subpart A
Jack, a U.S.-based freelance writer with a wealth of experience in the loan and subsidy industry, is more than just a wordsmith. Driven by a passion for financial education and consumer empowerment, he founded cuploanprogram.online. This blog serves as a platform for his expert advice and insights, aiming to demystify loan programs and promote fair and transparent lending practices for all.