United States Department of Agriculture

 State Director’s Message

The State of Arizona has a long history of success in carrying forth

the USDA Rural Development mission. In the year 2001, USDA

Rural Development employees have reached out to help Arizonans

in many ways. This annual report documents the dollars loaned and

grants provided, but it is impossible to document the appreciation of

a client that now has running water in their

home or the smile on a child’s face, as her

family picks up food at a local food bank.

USDA Rural Development programs help

people with the very basic necessities of

life, such as, food, shelter and clean

drinking water. Arizona employees can be

very proud of the fact their work has made

a difference in the lives of many Arizonans.

To be successful, we must have a good

working relationship with many partners.

We have partnered with lenders, through our Guaranteed Loan

Program to help create new or expand existing businesses. We work

directly with tribal housing authorities to deliver housing loans or

grants to the reservations. We work with many nonprofit

organizations, communities, and state government to increase our

effectiveness. We will continue to expand our relationship with

existing partners, as well as, seek out new partners for the delivery

of our programs to people in our rural communities.

I would like to thank the many partners in Arizona who have worked

closely with us to expand our programs. But most of all I want to

acknowledge our dedicated employees for their commitment to the

people and businesses of rural Arizona.

EDWARD (EDDIE) L. BROWNING

STATE DIRECTOR

 Rural Development

 Annual Report -- FY 2001

 Committed to Serving Rural Arizona

Rural Development in

Arizona provided in excess

of $93 million of

assistance to rural

residents

 Rural Housing

 $66,925,198 in loans,

grants, and

guarantees were

provided to meet

growing housing

needs in rural

 Arizona

 Community Programs

 $12,348,000

advances to

rural

communities for

Water and

Waste Projects

 Over $4 million

funded for

Community Facility

Projects in rural

communities

 Business & Industry

 Over $10 million of

assistance to rural

businesses in

Arizona

 345 jobs were

saved or created
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Program Highlights

Single Family Housing

For over 50 years USDA Rural Development has

been making the American Dream come true by

providing affordable housing to rural residents. In

FY 2001, we obligated $19,056,525 through our

Direct 502 Rural Housing Program and

$26,037,680 through our Section 502 Guaranteed

Rural Housing Program. These loans helped 590

families purchase, repair or refinance a home of

their own. Of these loans, $10,172,311 to 145

families were Mutual Self-Help Housing loans.

Grants totaling $1,499,291 were made to nonprofit

organizations who provided technical assistance to

Self-Help Housing participants. Under the SelfHelp Housing Program, families work together in

small groups to construct their own homes.

Participants in this program learn construction

skills, group participation skills and are able to get

new homes with 20 percent to 30 percent sweat

equity. They obtain homeownership with a more

affordable mortgage as a result.

Home Repair Loans and Grants

Seventy-three rural families were assisted with

Section 504 Home Repair loans totaling $396,524.

One-hundred-fifty-six elderly rural families were

assisted with Section 504 Home Repair Grants

totaling $880,705 in FY 2001. Section 504 loans

and grants are made to very low income rural

residents to remove health and safety hazards and

to make other necessary repairs to their dwellings.

Grants are only made to very low-income

applicants who are 62 years old or older. Section

504 Loan and Grant funds are used for such items

as roofing repairs, plumbing repairs, electrical

repairs, structural repairs and related items.

Multi-Family Housing

There are currently 2,809 units of Multiple Family

Housing financed by Rural Development in

Arizona. This program provides low-income

families with safe housing in an apartment setting.

Depending on income some families may qualify

for assistance or subsidies to pay rent. In FY 2001,

Rural Development in Arizona assisted families

with $5,676,393 in Rural Rental Housing

Loans, $4,176,883 in Rural Housing Site Loans,

$6,398,738 in Rental Assistance to Tenants in

Multiple Family Housing, $2,224,500 in Labor

Housing Loans, and $217,488 in Housing

Preservation Grants for Rehabilitation of Very Low

Income Housing Units. Multiple Family Housing

Program Funding for FY 2001 totaled $18,694,198.

Total Rural Housing funding in rural Arizona

for Fiscal Year 2001 was $66,925,198.

Community and Business Programs

Through the delivery of its Community and

Business Programs, Rural Development provides

loan and grant assistance for a variety of

Community Infrastructure and Business

Development projects in rural Arizona. Recipients

of Rural Development programs include public

bodies, special purpose districts, nonprofit

organizations, tribal entities and small businesses. 

The following is a summary list of FY 2001

Program Highlights.

Water and Wastewater Program

The Water and Wastewater Program offers

assistance to needy rural communities for the

development or improvement of existing water or

wastewater facilities. This past year 17 water, 8

wastewater and 1 solid waste projects for a total of

$9,112,380 was funded in rural Arizona. These

projects provided much needed water systems. In

some cases, water service for the first time to an

estimated 3,900 homes and commercial businesses

with an equivalent of over 13,700 individuals. The

sewer system projects provided central sewer

service to households that previously had

inadequate and failing individual systems. Through

the solid waste program funding was provided to

purchase a fleet of new solid waste collection

trucks for a tribal community that previously had a

fleet of trucks in disrepair.
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Community Facility Program

The Community Facility Program helps

communities build or expand essential community

facilities in rural areas. This past year Arizona

Rural Development funded 13 community facility

projects for a total of $4,425,740 in loans, grants

and guarantees to commercial lenders. Some of

this year’s projects consisted of funding for a new

school, 2 multi-purpose buildings on a tribal

village, a bridge, police station, an assisted living

facility and improvements for a dialysis center that

will serve 2 remote tribal communities.

Business and Industry Guaranteed

Program

The B&I Programs help provide jobs and stimulate

small rural businesses’ development by providing

financial backing to commercial lenders for rural

businesses. This year Arizona Rural Development

provided guaranteed loan funding for 8 businesses

for a total of $8,993,137 resulting in over 160 new

jobs being created or saved. A variety of projects

were funded which include a medical facility,

mobile home park, hospice facility, educational

institute, 2 gas service stations, storage facility, and

a direct loan to an assisted living facility.

Rural Business Enterprise

Grant Program

This program is designed to assist in the

development of small and emerging businesses and

creation of new job opportunities in rural

communities. This year Arizona funded 7 RBEG

grants totaling $609,620. The project included

activities, such as, funding a technical assistance

project, a revolving loan fund project and a ram

exchange program. This program will provide

assistance to an estimated 130 businesses and will

result in creating 85 new jobs and sustain

employment for an additional 21 positions.

Other Funding Assistance Programs

This year Arizona received funding under a new

Rural Business Opportunity Grant Program

designed to provide area-wide planning to identify

business development opportunities in rural areas.

Last year Arizona funded 2 grants totaling $49,750

for economic planning for a tribal project and for

conducting an economic feasibility study for a

small rural community. A Rural Enterprise

Opportunity Grant was also made in the amount of

$199,000 to a major education facility to provide

assistance for area-wide planning and setting up a

hands-on self-help training program for the

development of cooperatives in rural areas

Empowerment Zone/Enterprise

Communities

Arizona is home to 2 Enterprise Communities

comprised of the Arizona Border Region Enterprise

Community (AZBREC) and the Four Corners

Empowerment Zone(4CEZ). The AZEBREC is

comprised of 3 border communities, while the

4CEZ represents 23 communities located on the

Navajo Nation in Arizona, New Mexico and Utah.

These communities receive technical assistance

from Rural Development personnel in

implementing of their strategic plans by use of a

benchmark system. Funding assistance is provided

through the Office of Community Development on

a yearly basis and is administered through the

Arizona Rural Development State Office. This

year the 4CEZ received funding assistance in the

amount of $250,000 for implementation of various

economic development projects identified in their

strategic plan.

306-C Colonia Programs

The State of Arizona is 1 of 4 states along the U.S.

Mexico border that receives 306-C Colonia funding

for water and waste projects. This program is

designed to assist the most needy communities with

water and sewer infrastructure improvements, as

well as, providing grant assistance to qualifying

individuals for home improvements to remove

health or sanitary conditions. This year 7 water and

3 waste water projects totaling $2,434,000 were

funded in various designated Colonia communities.

An additional 91 individual homeowners received a

total of $360,471 in grants for home repair projects.
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Our country stands united as we report on a unique and challenging year for the

Department of Agriculture. In the wake of the tragedies of September 11th, we have worked to ensure

the protection of our food supply, employees, customers, facilities and programs. As president Bush

has said, “We will not waver; we will not tire; we will not falter; and we will not fail. Peace and

freedom will prevail.”

During the past year, we faced many challenges, but many opportunities as well. As our New

Administration has taken hold, USDA’s Rural Development undertook many efforts to assist and

strengthen our rural communities. These efforts included: 950 communities approved for $1.4 billion

in loan and grant funds to establish or improve drinking water or waste disposal systems for more than

a million rural residents; 43,000 families received loans to purchase a home, allowing them to realize

their dream of owning their own home and contributing to an all time high in our nation’s

homeownership rate; and nearly $15 million in grant funds were provided to distance learning projects

encompassing over 590 educational institutions, and $11.5 million for 41 telemedicine projects

involving nearly 236 medical facilities, bringing greater access for rural residents to much needed

educational and medical services.

Over the years, we have made great strides to better serve our customers. In September, we unveiled a

new report, “Food and Agricultural Policy: Taking Stock for the New Century.” This study focuses on

the challenging role of agriculture and rural development and how we can work together to provide

new opportunities and greater economic growth for this nation’s farmers, ranchers and rural

communities. I encourage you to review this report from the USDA’s website at www.usda.gov.

Residents in Arizona and from all across this nation are what truly makes America great. We can

continue to build on our successes in strengthening our rural communities. And, our Rural

Development employees stand ready to assist in anyway they can.

ANN M. VENEMAN

Secretary of Agriculture

Casa Grande Local Office, 115 E. First Street, Suite 1, Casa Grande, AZ 85222, (520)836-1960/(520)836-1297 fax

Flagstaff Sub-Office, 1585 South Plaza Way, Suite 120, Flagstaff, AZ 86001, (928)774-2401/(928)774-2780 fax

Holbrook Local Office, 51 West Vista, Suite 5, Holbrook, AZ 86025, (928)524-2771/(928)524-6609 fax

Kingman Local Office, 101 East Beale Street, Suite B, Kingman, AZ 86401, (928)753-6181/(928)753-3254 fax

Nogales Local Office, 2585 North Grand Avenue, Suite 5, Nogales, AZ 85621, (520)281-0221/(520)281-1460 fax

Phoenix Local Office, 3150 North 35th Avenue, Suite 6, Phoenix, AZ 85017, (602)353-0378(602)353-0906 fax

Prescott Valley Local Office, 8841 Florentine, Suite B, Prescott Valley, AZ 87314, (928)759-9301/(928)759-9284 fax

Safford Local Office, 305 East 4th Street, Safford, AZ 85546, (928)428-0635/(928)428-4284 fax

St. Michaels Local Office, St. Michael’s Professional Plaza, Highway 264, P.O. Box 859, St. Michaels, AZ 86511, (928)871-5038/(928)871-4530

Tucson Local Office, 4650 North Highway Drive, Suite 1, Tucson, AZ 85705, (520)887-4505/(520)888-1467/(520)888-1467

Willcox Local Office, 658 North Bisbee Avenue, Willcox, AZ 85643, (520)384-3529/(520)384-2735 fax

Yuma Local Office, 2450 South 4th Avenue, Suite 401, Yuma, AZ 85364, (928)726-4707/(928)341-1499 fax

Annual Report From Secretary Of Agriculture