Cover Photo courtesy, Don Erne, 

Salmon River Rural Fire District

Business-Cooperative Programs

Business & Industry Loan Guar. $11,570,000

Business Enterprise Grants $286,000 

Business Opportunity Grants $135,000

Intermediary Relending $400,000

Value Added Producer Grants $49,835

Section 9006 Energy Grants $217,639

TOTAL $12,658,474

 

Community Programs

Water & Waste Funds $21,168,114

 includes direct loans for 

 $16.7 million, grants for

 $4.2 million and a 

 guaranteed loan for $25,000

Pre-Development Planning Grants $15,000

Native American Set Aside $700,000

 Grants

Community Facilities (CF) $7,181,000

 includes direct loans, 

 guaranteed loans grants

TOTAL $29,064,114

 

Housing Programs

Single-Family Housing $49,186,979

 including Direct & Guaranteed

 loans and grants and

 self-help programs

Mutual Self-help Housing Grant $622,000

Housing repairs $539,633

 includes over $260,000

 in grant funds

Rural Rental Programs $20,116,383

Multi-Family Housing $52,285

 Preservation Grant

TOTAL $70,517,280

 

B&I Loan 

Guarantee Brings 

Modernization to 

Lumber Mill

Wind Power to Help in 

Hydrogen Production

Liquid hydrogen is used in various 

chemical and industrial applications, 

including steel making, glass making, 

oil refi ning, computer chip manufacturing, and 

vitamin manufacturing. Additionally, efforts 

are underway to move to a hydrogen-based 

energy system, such as fuel-cell powered 

cars, rather than a petroleum-based system. 

Typically, liquid hydrogen is produced from 

reformed natural gas, a non-renewable 

resource with a high degree of price volatility.

Synthetic Energy, Inc., was created to 

develop a capacity for hydrogen production 

Carnoustie II

Offi cials of the City of Hayden were scheduled for a State sponsored 

re-paving project and discovered they could capitalize on the 

streets being torn up to complete more improvements. The City 

was approved for a CF Direct loan and were able to widen the main street, 

put in festival and pedestrian lighting, install median islands and trees and 

bury existing overhead utilities.

The City had been in need of this revitalization project for some time. The 

main street is now wide enough to allow for turning lanes; there are curbs and 

gutters, and the condition of the walkways allows for safe pedestrian traffi c. 

This was a case of form and function coming together to make a 

community an even better place to live. The changes addressed a variety of 

needs, from safety and effi ciency to beautifi cation and economics.

City of Hayden Downtown 

Revitalization

Earth Day 2005

I

daho Rural Development celebrated Earth Day in the city of St. Anthony. 

Some of St. Anthony’s existing sewer collection system was constructed of red 

clay tile about 1917. The existing wastewater collection and treatment system 

was found to be deteriorating and inadequate to meet current State requirements for 

wastewater systems. Rural Development was able to offer the assistance to correct 

the defi ciencies. 

Mike Field, State Director said “On this 35th anniversary of the fi rst Earth Day, 

USDA Rural Development is proud to participate with the City of St. Anthony to help 

ensure a healthy and clean environment for future generations in rural Idaho.”

The project is providing improved service to approximately 1,484 users and will 

serve the community for the next 30 years. 

Konkolville Lumber Company of Orofi no, founded in 

1947, knew they needed to update their mill. They 

were one of the most obsolete mills in the area. 

Their business had been successful because they focused 

on producing specialty items that sell for a premium but they 

wanted to do more. Much of their product is 1” appearance 

grade white fi r and cedar which is used by the remodeling 

market. 

Through AmericanWest Bank the Business Cooperative 

Program arranged to guarantee a loan of $3,700,000 for major 

improvements. This modernization will bring new equipment 

which will enable current employees who re-train as operators 

to increase their wage from an average of $8/hour to $14/

hour. The modernized sawmill will focus on the processing of 

utilizing renewable resources, specifi cally wind energy. With the assistance 

of a Section 9006 Energy Grant in the amount of $199,863, Synthetic Energy, 

Inc., will be developing a prototype liquid hydrogen production facility. The 

Grant will help the Company develop a wind-turbine electrical generating 

system that, in conjunction with electricity from traditional sources, will be used 

to separate hydrogen from water. The Company has a market niche in that it 

captures a renewable source of energy (wind) combined with a small amount 

of water to generate high-purity hydrogen, resulting in a high quality, lower-cost 

hydrogen production facility. 

Desert Sage Medical Clinic

Members of the National Association of Community Health Centers 

(NACHC), as well as State and Local Offi cials were on hand for a 

ribbon cutting ceremony and open house for the newly constructed 

Desert Sage Medical Clinic. The new 7600 sq. ft. facility was made possible 

through CF Direct and Guaranteed Loans. 

Offi cials agreed that the new facility is a great success story for Glenns 

Ferry Health Centers and applauded all those involved for their hard work and 

dedication in seeing the project through. This beautiful modern facility will 

enable Desert Sage to continue to provide quality affordable health care to the 

citizens of Mountain Home.” 

Partnership Provides 

New Beginning

Because of successful partnerships 

such as the American Dream Down 

Payment Initiative, the 502 Direct 

Program, and a generous relative, Haily 

Murphy, a single mother was able to fi nd a 

home for her small family. After months of 

searching, she fi nally found the perfect home 

for herself and her son. At the time of closing 

Haily said, “I never thought that it would be 

Pursuing a Dream

large diameter sawlogs, with an increased proportion of minor species and the production of an increased percentage of highvalue niche market products. Other project funds will be used to renovate and expand an existing building to house the new 

equipment and improve the mill fl ow. Konkolville Lumber Company has sought out and developed niche products with the goal 

of higher margins and more consistent profi tability.

The face of Orofi no, in Clearwater County, has experienced a transformation. John Vaage of AmericanWest Bank puts 

it this way when speaking of the changes happening there: “The best part of this story is job creation and retention. For 

example, Brookside (senior housing facility) 39 employees, Lodge at River’s Edge (Best Western Motel) 29, Dining on 

the Edge (restaurant) 24, and Konkolville Lumber (mill) 85. You can’t overestimate the importance of 177 jobs in a town of 3,240.

 Another great aspect is the physical transformation of Orofi no. A junkyard 

on the banks of the Clearwater River became a destination motel and restaurant 

that will pump economic life into the community. A vacant lot became a 56-unit 

senior housing facility that enables its 62 residents to continue to live close to 

family and friends. These are the kind of projects that break trail for economic 

development. More growth will follow in their wake.”

Through USDA’s Rural Development Business & Industry Loan Guarantee 

Program, over $7.1 million in loan guarantees have been made to AmericanWest 

Bank for the restaurant, lumber mill, senior housing facility, and motel. Other 

USDA RD programs have contributed over $100,000 in grant funds, including 

a $25,183 grant in June of 2005 to the Clearwater Economic Development 

Association (CEDA) in Lewiston, which added much needed dollars to their 

micro-loan revolving fund.

The Fountain at Dining on the Edge

possible for me to buy a house on my own.” She is excited to begin her 

future in her beautiful home. USDA Rural Development is happy to be a part 

of this new beginning for Haily and her family.

First Section 538 in Idaho

A Guaranteed Rural Rental Housing Loan added 32 affordable 

housing units to this facility in Shelley, Idaho. It was the fi rst Section

538 Guaranteed Loan in Idaho and provided $770,000 for this 

much needed multi-family housing complex. Tom Mannschreck, 

president of Tomas Development, Carnoustie’s developer, said, 

“Shelley appears to be experiencing signifi cant growth, and we are just happy 

to be a part of it.”

“I have so much to be grateful for . .

 I cannot thank you enough for what you

 have given to me and my daughter.”
2005 Annual Report

u sd a

ru r a l d e v e lo pm en t

id aho

On May 11, 2005, USDA Rural Development celebrated 70 years of service to America. Much has 

changed since 1935 when the crisis was the Depression, our mission was agricultural stabilization, and 

the cutting edge was rural electrifi cation. Today, rural America is dynamic and diversifi ed; the cutting 

edge is broadband and renewable energy. Our Rural Development mission is increasing economic 

opportunity and improving the quality of life in rural America. But from 1935 through today, one thing 

has remained constant: the commitment of the men and women of USDA Rural Development to the 

future of rural communities. 

The future holds challenges, but it also holds great promise. As you plan for the future, USDA Rural 

Development is here to support you and your community. We are locally based; as your neighbors, our 

employees are rooted in your communities and share your values and concerns, just as we have since 

1935. We are proud of Rural Development’s record of achievement throughout the past 70 years and we 

look forward to working with you to bring increased opportunities to Idaho as we work together to build 

an even stronger rural America. 

One of the biggest challenges facing our nation is the need for renewable energy. In our ongoing 

effort to promote development of new energy sources, USDA Rural Development in 2005 funded 

154 renewable energy grants and two renewable energy loans totaling $32.3 million. Additionally, 

through the Value Added Producer Grant program, Rural Development provided $2.8 million for 30 

more energy related projects.

From wood fi red generating plants to wind turbines, biofuel production and anaerobic digesters, 

USDA Rural Development is fi nancing new sources of renewable energy while offering farmers and 

ranchers a potential new source of income. 

I’m proud of the job our employees do every day. They’re highly skilled, dedicated, and truly 

“Committed to the Future of Rural Communities.”

Mike Johanns

Secretary of 

Agriculture

Thomas Dorr 

Under Secretary 

USDA Rural Development

USDA RURAL DEVELOPMENT

Committ ed to the future of rural communiti .

A not e fr om Idaho State Dire or, Michael A. Field . . . Fellow Idahoans:

We are pleased to report on the activities of Idaho USDA Rural Development for Fiscal Year 2005.

In this annual report, you’ll fi nd information about how USDA Rural Development programs have 

helped rural communities in our state. We hope it will give you a better idea of how we are fulfi lling 

our mission of providing assistance, by partnering with local residents, to create new economic and 

social opportunities in their communities.

Helping to create quality jobs, housing, safe drinking water, and reliable and modern infrastructure 

for rural communities remains a top priority. Rural Development employees in Idaho are working in 

partnership with federal, state, tribal and local government offi cials as well as the private sector to make 

certain our fi nancial resources are invested wisely. 

Investment in Rural Idaho - FY 2005

Housing - $70,515,280

Community Programs - $29,064,114

Business Cooperative - $12,658,474

Community Connect/DLT - $487,661

Electric Program - $60,570 

Area and 

State 

Offi ce

Locations Northern Idaho - Area I

7830 Meadowlark Way, Ste. C3

Coeur d’Alene, ID 83815

(208) 762-4939 FAX: 762-9799 

Western Idaho - Area II

2208 East Chicago, Suite C

Caldwell, ID 83605

(208) 459-0761 FAX: 459-0762 

Eastern Idaho - Area IV

725 Jensen Grove Dr., Suite 1

Blackfoot, ID 83221

(208) 785-5840 FAX: 785-6561 

Central Idaho - Area III

1441 Fillmore, Suite C

Twin Falls, ID 83301

(208) 733-5380 FAX: 734-0428 

Idaho State Offi ce

9173 West Barnes Dr., Suite A1

Boise, ID 83709

(208) 378-5600 FAX: 378-5643 

USDA is an equal opportunity provider, 

“USDA is an equal opportunity provider, employer and lender. To fi le a 

complaint of discrimination write USDA, Director, Offi ce of Civil Rights, 

1400 Independence Avenue, SW, Washington, DC 20250-9410 or call 

(800) 795-3272 (voice) or (202) 720-6382 (TDD).”

Northern Idaho - Area I

7830 Meadowlark Way, Ste. C3

Coeur d’Alene, ID 83815

(208) 762-4939 FAX: 762-9799 

ern Idaho - Area II

2208 East Chicago, Suite C

(208) 459-0761 FAX: 459-0762 

Eastern Idaho - Area IV

725 Jensen Grove Dr., Suite 1

Blackfoot, ID 83221

(208) 785-5840 FAX: 785-6561 

(208) 733-5380 FAX: 734-0428 

9173 West Barnes Dr., Suite A1

(208) 378-5600 FAX: 378-5643 

We want to thank our private, nonprofi t, and government partners who have participated with us in these projects. With their 

assistance, we have been able to help rural residents statewide.

We recognize that the best solutions to rural problems are developed by those on the ground. We stand ready to assist Idaho’s rural 

communities by being an active participant in their growth.

Sincerely

Michael A. Field

State Director