USDA Rural Economic Development Loan and Grant Programs for Fiscal Year 2024
OPPORTUNITY:
The Rural Business-Cooperative Service (RBCS or Agency), a Rural Development (RD) agency of the United States Department of Agriculture (USDA), invites applications for loans and grants under the Rural Economic Development Loan and Grant Programs (REDLG or Programs) for fiscal year (FY) 2024, subject to the availability of funding. This notice is being issued before the passage of an FY 24 Consolidated Appropriations Act, which may or may not provide funding for this program. It allows applicants sufficient time to leverage financing, prepare and submit their applications, and give the Agency time to process applications within FY 2024.
DESCRIPTION:
The Rural Economic Development Loan and Grant programs fund rural projects through local utility organizations. USDA provides zero-interest loans to local utilities, which they, in turn, pass through to local businesses (ultimate recipients) for projects that will create and retain employment in rural areas. The ultimate recipients repay the lending utility directly. The utility is responsible for repayment to USDA.
USDA grants local utility organizations that use the funding to establish Revolving Loan Funds (RLF). Loans are made from the revolving loan fund to projects that create or retain rural jobs. When the revolving loan fund is terminated, the grant is repaid to USDA.
The local utility passes the funding to ultimate recipients for such eligible projects as:
- 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.
Local Utility organizations may use funds to lend for projects in rural areas or towns with fewer than 50,000 residents.
COST SHARING:
For REDL loans, either the Ultimate Recipient or the Intermediary must provide supplemental funds for the Project equal to at least 20 percent of the loan to the Intermediary.
For REDG grants, the Intermediary must provide supplemental funds to capitalize the Revolving Loan Fund, equal to at least 20 percent of the Grant to the Intermediary.
ELIGIBLE APPLICANTS:
- 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
- Any not-for-profit utility that is eligible to receive an insured or direct loan under the Rural Electrification Act
FUNDING AVAILABLE AND APPLICATION WINDOW:
FUNDING AVAILABILITY: Estimated $90 million
Maximum Grant Amount: $300,000 to establish the Revolving Loan Fund
Maximum Loan Amount: $2 million
APPLICATION DEADLINE: Competitions for the available loan and grant funds will be made quarterly for applications that are received no later than 11:59 p.m. Eastern time on the first Quarter, September 30, 2023; Second Quarter, December 31, 2023; Third Quarter, March 31, 2024; and Fourth Quarter, June 30, 2024.
