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# Rural Economic Development Loan & Grant Program

**Fact Sheet

Federal Register Notice

##             Overview          

**What do these programs do?**

Revolving Loan Funds

**Who may apply?**
                                  - Current Rural Utilities Service (RUS), electric or telecommunication borrower,
                                  - Any former RUS borrower that has repaid or prepaid an insured, direct or guaranteed loan under the Rural Electrification Act,
                                  - Or any not-for-profit utility that is eligible to receive an insured or direct loan under such Act.

**What is an eligible area?**

IntermediariesEligibility

**How much funding is available to local utilities?**
                                  - Maximum Grant Amount : $300,000 to establish the Revolving Loan Fund.
                                  - Up to 10 percent of grant funds may be applied toward operating expenses over the life of the Revolving Loan Fund.
                                  - Maximum Loan Amount : $2 million.

**How may funds be used?**
                                  - Business incubators.
                                  - Community development assistance to nonprofits and public bodies (particularly for job creation or enhancement).
                                  - Facilities and equipment to educate and train rural residents to help economic development.
                                  - Facilities and equipment for medical care for rural residents.
                                  - Start-up venture costs, including, but not limited to, financing fixed assets such as real estate, buildings, equipment, or working capital.
                                  - Business expansion.
                                  - Technical assistance.

**NOTE:**7 CFR, Part 4280.277 CFR, Part 4280.30

**What are the terms for the local utility?**

**What are the terms on the loan to the ultimate recipient?**
                                  - The interest rate is zero percent.
                                  - Up to 80 percent of project costs; 20 percent must be provided by the ultimate recipient or the local utility.
                                  - The local utility may incorporate interest rates or administrative loan fees after the funds have been loaned out and revolved once. First-time loans are at zero percent interest.
                                  - Repayment may be deferred up to two years for projects including a start-up venture or Community Facilities project.

**How do we get started?**

local office

**Who can answer questions?**

local office

**What law govern these programs?**
                                  - Basic Program – Code of Federal Regulations,  7 CFR, Part 4280 .
                                  - Loan/Grant Servicing – Code of Federal Regulations,  7 CFR, Part 4280  and 2 CFR Part 200.
                                  - These programs are authorized by the Rural Electrification Act of 1936.

**Why does USDA Rural Development do this?**

##             To Apply          

**NOTE:** If state specific forms are not shown above, please ensure that your state is selected in the dropdown menu above to find the State Office contact information and speak to a Business Programs Specialist before attempting to fill out any forms or applications. This will save you valuable time in your application.

RBCS How-To Apply Video Series for Applicants

You may also access the Code of Federal Regulations, 7 CFR, Part 4280.

##             Other Requirements          

There are no additional requirements.

##             Contact          

Please select your state in the dropdown menu above to find your local contact for these programs.

Persons with disabilities that require alternative means for communication should contact the U.S. Department of Agriculture (USDA) Target Center at (202)720–2600 (voice).

##             Events