USDA Rural Development

1. USDA Rural Development May 2011

2. USDA RD Our Mission To increase economic opportunity and improve the quality of life for all rural Americans

3. USDA - Rural Development Rural Business / Cooperative Programs Business Finance-Nine Programs

4. Business and Industry Guarantee Guarantees to local lenders 80% up to $5 million 70% up to $10 million 60% up to $25 million For starting or expanding rural businesses and cooperatives Reduces risk to lenders and raises their lending limits

5. Business and Industry Guaranteed Loans • Loans are Made by Eligible Lenders • Uses of loans: • Equipment • Construction • Working capital • Refinancing in Certain Situations

6. Rural Business Enterprise Grant(RBEG) Provides Grants to: Public Bodies (Cities) Non-Profits, Tribes All Serving Rural Areas • Grants can finance small and emerging private businesses and cooperatives, provide technical assistance or fund a revolving loan program • Commonly requests are $99,000 or less have higher priority

7. Rural Business Opportunity Grants (RBOG) • Eligible applicants: tribes, nonprofits, public bodies • Purposes: • Identify and analyze business opportunities • Provide TA to existing or prospective entrepreneurs • Conduct local or multi-county Econ. Dev. Planning • Conduct leadership training • Pay for professional services for planning or training. • Priority scoring: Applications under $50,000

8. Rural Economic Development Loan • Zero Percent Interest Loans may be made to RUS Borrowers (Electric or phone Coops) • Supplemental Funding of at Least 20% of the Zero Percent Interest Loan is Needed • $740,000 Maximum Loan

9. Rural Economic Development Grant • Revolving Loan Fund (RLF) Established by Electric or Telephone Coop • Funding for Community / Medical Facilities and Education Facilities • $300,000 Maximum Per Project

10. Value Added Producer Grants (VAPG) • Eligible: Individuals, LLC, LLP, For-Profits, or Non-Profits that are owned or controlled by Ag Producers • Deadline to be announced soon (60 day window to submit applications) • Planning Grant $100,000 • Working Capital $300,000. • There is a $1 to $1 match requirement • Must be a change in the physical state of the product

11. Changes to VAPG • Provide up to 10 % funding to beginner farmers and socially disadvantaged farmers and ranchers;
 • • Provide up to 10 % funding to local and/or regional supply networks that link producers with companies marketing their products; 
• Give priority for grants to beginner farmers, socially disadvantaged farmers and ranchers, and operators of small and medium-sized family farms; 
• Extend grant eligibility to producers who market their products within their state or within a 400-mile radius.

12. Sec. 9007: Rural Energy for America Program (REAP) Grants and Loan Guarantees for Rural Small Businesses, Farmers and Ranchers

13. Renewable Energy and Energy Efficiency Improvement • Purchase renewable energy systems (A system that producesor produces and delivers usable energy from a renewable energy source) • Energy Efficiency Improvements (Improvements to a facility or process that reduceenergy consumption)

14. REAP Program Overview • REAP– Cost Sharing • The amount of the grant shall not exceed 25% of the eligible cost of the activity funded. • The combined loan and grant made or guaranteed shall not exceed 75% of the eligible cost of the activity funded. • Only post-application costs eligible.

15. What Small Businesses are Eligible? • A private entity including a sole proprietorship, partnership, corporation, & cooperative • Citizenship • Visit http://sba.gov/size/index.html for meeting the size definition. • NOTE: Public or private non-profits are not eligible.

16. What Agricultural Producers Are Eligible? • Must directly engage in production of agricultural products. • At least 50% of gross income must be from agriculture production. • Citizenship.

17. Solar Energy Solar Powered Stock Tanks in the Powder River Basin: A Renewable Energy System for Livestock Producers Wind Energy

18. Geothermal – Direct Use • A system that uses thermal energy directly from a geothermal source • At high temperatures, can directly heat water or buildings • At lower temperatures, temperature difference between earth and air can heat and cool buildings

19. Blender Pumps • APPLICANT ELIGIBILITY  The applicant must be a rural small business or agricultural producer. For gasoline service stations with convenience stores, applicants must have total income of $27 million or less in the previous tax year. Total income is defined as gross receipts less cost of goods sold.  Current on all Federal debts. • PROJECT ELIGIBILITY  The project must be for the purchase and installation of a renewable flexible fuel blender pump system (such as mid-range ethanol blends or E85).

20. Application Deadlines • We encourage applicants to file early. • For renewable energy system and energy efficiency improvement grant applications and combination grant and guaranteed loan applications: June 15, 2011. • For renewable energy system and energy efficiency improvement guaranteed loan only applications: June 15, 2011 • For renewable energy system feasibility study and energy audits and assistance applications: June 30, 2011. • FY11 $61 million for Guarantees/ $42 million for Grants Contact Rural Development office nearest you to start the application process and get a firm bid!

21. Intermediary Relending Program • Eligible applicant: Nonprofits, Tribes, public agencies • Purpose:Start a revolving loan fund • Rates & Terms – 1% for 30 years to the intermediaries and they relend • Deadline to apply: Quarterly

22. Rural Microentrepreneur Assistance Program (RMAP) RMAP’s goal is to help new & existing rural microentrepreneurs by providing funds to development organizations for microlending and technical assistance

23. RMAP • Loans to capitalize revolving microloan funds • Grants for microlenders to assist their applicants & borrowers and to build their own capacity

25. Aberdeen (605) 224-3360 Mitchell (605) 996-1564 Pierre (605) 224-8870 Rapid City (605) 342-0301 Sioux Falls (605) 330-4515 Watertown (605) 886-8202 Yankton (605) 665-2662 www.rurdev.usda.gov/sd South Dakota RD Office Locations

26. USDA Rural Development State Office 200 4th Street SW, Federal Building Rm. 210 Huron, SD 57350-2477 (605) 352-1100 or 1-800-670-6553