Together, America Prospers 

OneRD Guarantee Loan Initiative: 

Community Facilities Guaranteed Loan 

What does this 

program do? 

This program provides loan 

guarantees to eligible lenders 

to develop essential community 

facilities in rural areas. An essential 

community facility is defined as 

a public improvement, operated 

on a non-profit basis, needed 

for the orderly development of a 

rural community where the rural 

community is a city or town, or its 

equivalent county or multi-county 

area. The term “facility” refers 

to both the physical structure 

financed, and the resulting service 

provided to rural residents or 

rural businesses. 

Who may apply for 

this program? 

Lenders who have the legal 

authority, financial strength and 

sufficient experience to operate a 

successful lending program. This 

includes lenders that are subject to 

supervision and credit examination 

by the applicable agency of the 

United States or a State, including: 

• Federal and State chartered banks 

• Farm Credit Banks with direct 

lending authority 

• Bank for Cooperatives 

• Savings and Loan Associations 

• Savings banks 

• Mortgage companies that are 

part of a bank-holding company 

• The National Rural Utilities 

Cooperative Finance Corporation 

• Credit unions 

• State Bond Banks or State 

Bond Pools 

Other non-regulated lending 

institutions may also be approved 

by the Agency under the criteria of 

the OneRD regulation. 

Who may qualify for these 

loan guarantees? 

Eligible borrowers are: 

• Public bodies 

• Indian Tribes on Federal and 

State reservations 

• Federally-recognized Tribes 

• Non-profit organizations 

Additional entities may be eligible for 

other types of loan guarantees under 

the OneRD Guarantee Loan Initiative. 

What is an eligible area? 

• Rural areas with populations of 

50,000 residents or less, which 

excludes certain populations 

pursuant to 7 U.S.C. 1991(a)(13)(H)*, 

based on the latest decennial census 

of the United States and not in the 

urbanized area contiguous and 

adjacent to that city or town. 

• The lender may be located anywhere 

in the United States. 

• Check an eligible rural area. 

*Exclusion of incarcerated populations. 

Populations of individuals incarcerated 

on a long-term or regional basis shall not 

be included in determining whether an 

area is “rural” or a “rural area”. 

How may funds be used? 

Each year the Agency will reserve funds 

for projects located in rural areas with 

a population of not more than 20,000 

inhabitants based on the following 

reservation of funds schedule: 

1. 100% of the first $200,000,000 

made available 

2. 50% of the next $200,000,000 

made available 

3. 25% of all amounts exceeding 

$400,000,000 made available 

Funds can be used to construct, 

enlarge, extend or otherwise improve 

essential community facilities. Guarantee 

funds can also be used for refinancing 

the debt of an essential community 

facility. Examples of essential community 

facilities include: 

• Health care facilities and services, 

including but not limited to hospitals 

• Fire, rescue, and public safety 

facilities and services 

• Community, public, social, educational, 

or cultural facilities or services 

• Transportation facilities such as 

streets, bridges, roads, ports, 

and airports 

• Certain utility projects when not 

eligible for Rural Utilities Service 

financing, gas distribution systems, 

recycling and transfer centers 

or stations 

• Telecommunications end-user 

equipment when related to public 

safety, medical, or educational 

telecommunication links when 

not eligible for Rural Utility 

Services financing 

• Water infrastructure facilities 

such as levees, dams, reservoirs, 

inland waterways, canals, and 

irrigation systems 

• Purchase and installation of 

renewable energy systems for use 

by an essential community facility 

(conditions apply) 

• Land acquisition and necessary 

site preparation including access 

ways and utility extensions to and 

throughout an industrial park site 

• Community parks, community activity 

centers, and similar types of facilities 

For a complete list see Code of Federal 

Regulations 7 CFR 5001.103(a) and 

5001.121(a). 
 

OneRD Guarantee Loan Initiative: 

Community Facilities Guaranteed Loan Initiative 

What may loan guarantee funds 

NOT be used for? 

• Lines of credit. 

• Owner-occupied and rental housing. 

• Golf courses or golf course 

infrastructure. 

• Racetracks or gambling facilities. 

• Facilities used for inherently 

religious activities. 

• Projects that create, directly or 

indirectly a conflict of interest. 

• Inherently commercial enterprises. 

For a complete list see Code of 

Federal Regulations 7 CFR 5001.115, 

5001.116, and 5001.122. 

How do we get started? 

• Applications are accepted from 

lenders through USDA local offices 

year-round. 

• Interested borrowers should inquire 

about the program with their lender. 

• Lenders interested in participating 

in this program should contact the 

USDA Rural Development Community 

Programs Director in the state where 

the project is located. 

Who can answer questions? 

Contact the local Rural Development 

office that serves your area. 

What governs this program? 

Code of Federal Regulations, 

7 CFR 5001. 

NOTE: Because citations and other information may be subject to change 

please always consult the program Instructions listed in the section above titled 

“What Law Governs this Program?” You may also contact your local offce 

for assistance. USDA is an equal opportunity provider, employer, and lender. 

September 2020