Business Program Opportunities

1. Business Program Opportunities Overview of Business Programs

2. Presenters • Today’s Presenters Include: • Mark Brodziski, Director • Specialty Programs Division • Mark.Brodziski@wdc.usda.gov • John H. Broussard, Director, • Business and Industry Division • John.Broussard@wdc.usda.gov

3. Business Programs • Lillian Salerno, Acting Administrator • Pandor H. Hadjy, Deputy Administrator • Mary Ann Clayton, Asst. Deputy Administrator • John H. Broussard, B&I Division Director • William Smith, Energy Director • Mark Brodziski, Specialty Programs Director

4. Objectives • Become familiar with USDA Rural Development • RuralBusiness—Cooperative Programs: • B&I Guaranteed Loan Program • Specialty Programs Division • Energy Programs Division • Cooperative Programs

5. USDA Rural Development • The mission of USDA Rural Development is to increase economic opportunity and improve the quality of life for all rural Americans.

6. Rural Business Programs • Enhance the quality of life for rural Americans by providing leadership in building competitive businesses including sustainable cooperatives that can prosper in the global marketplace.

7. We accomplish this by: • Investing financial resources and providing technical assistance to businesses located in rural communities • Establishing strategic alliances and partnerships that leverage public, private, and cooperative resources to create jobs and stimulate rural economic activity

8. Business Programs • B&I Guaranteed Loan Program • Intermediary Relending Program • Rural Business Enterprise Grant Program • Rural Economic Development Loan and Grant Program • Rural Microenterprise Assistance Program • Rural Business Investment Program • Energy Programs

9. Business & Industry • Guaranteed Loan • made for state of the • art drilling barge used • within inland waters • of the Gulf Coast.

10. Business & Industry • Chef Paul Prudhomme’s hometown Andouille and Tasso Meat processing facility.

11. Business & Industry • Sells peanuts to Mars Candy to produce Snickers and peanut M&Ms

12. Manufacturer of outdoor wrought-iron furniture

13. FY 2012 Funding (FY 2013?) • B&I Guaranteed - $810,511,982 • IRP - $17,709,563 • RBEG - $19,405,858 • REDLG (loan) $79,000,000 • REDLG (Grant) $10,000,000 • REAP (Loan) - $32,682,089 • REAP (Grant) - $16,840,561 • VAPG (Grant) - $14,000,000 • RCDG (Grant) - $5,800,000 • RBOG (Grant) - $2,370,000

14. Specialty Programs • Intermediary Relending Program (IRP) • Rural Business Enterprise Grant Program (RBEG) • Rural Economic Development Loan and Grant Program (REDLG) • Rural Microenterprise Assistance Program (RMAP) • Rural Business Investment Program (RBIP)

15. Specialty Programs EXAMPLES OF PROJECTS

16. Franklin General Hospital, Hampton, Iowa

17. Sportsmans Resort—Tourism

18. Timeless Bridal—Retail

19. North Manufacturing—Mfg

20. Local Food Enterprise Center

21. LSU Training Mobile

23. Rural Business Enterprise Grant

24. Specialty Programs • Eligible applicants/intermediaries: • Rural public entities (towns, communities, State agencies, and authorities) • Indian tribes • Non-profit corporations • Some cooperatives for IRP • REDLG is limited to entities eligible for USDA-RUS Electric & Telecomm

25. Specialty Programs • Highlights: • Businesses and projects assisted must be located in a rural area • Matching or supplemental funding is generally required • Program funding is competitive • Applications are processed through Rural Development Area and State Offices

26. Renewable Energy Funding Opportunities

27. Rural Energy for America Program • Created in the 2002 Farm Bill as the Section 9006 program • Revised in the 2008 Farm Bill as Section 9007, Rural Energy for America Program

28. REAP – 3 programs in 1 • Energy Audits & Renewable Energy Development Assistance • Feasibility Study grants • Equipment & construction of renewable energy and energy efficiency projects

29. REAP – Part 1EA/REDA • Renewable Energy Development Assistance/Energy Audit – includes site evaluations forrural small businesses and agricultural producers to utilize more energy efficient measures and to use renewable energy technologies and resources.

30. REAP - Part 1 - EA/REDA • Eligible applicants • Governmental (State, Tribal and Local) • Institutions of Higher Education • Electric cooperatives • Public power entities

31. Renewable Energy Systems Wind Solar Geothermal Biomass Hydro Power Hydrogen Energy Efficiency Improvements Buildings Industrial (Equipment) **Replacement** REAP – Parts 2 & 3

32. Feasibility Study Grants • Up to 25% of eligible project costs • Maximum: Lesser of $50,000 or 25% of cost • Minimum: None • Determine Feasibility of Renewable Energy Systems

33. Agricultural Producers Directly engaged in ag production 50%+ of gross income comes from ag production Electric Cooperatives (considered a small business as long as annual electric output is < 4 million MW hours) Rural Small Businesses Must meet SBA small business size standards Use NAICS code for industry type: http://www.sba.gov/size/index.html REAP – parts 2 & 3 Eligibile Applicants

34. Renewable Energy • Energy derived from a wind, solar, biomass, or geothermal source; or hydrogen derived from biomass or water using wind, solar, biomass, or geothermal energy sources • Renewable energy system • A system that produces or produces and delivers usable energy from a renewable energy source.

35. Energy Efficiency Improvement • Improvements to a facility, building, or process that reduces energy consumption, or reduces energy consumed per square foot.

36. Eligible Costs • This program is for bricks and mortar projects, so the majority of funds should go towards: • Post application purchase & installation of equipment • Post application construction or project improvements

37. Renewable Energy Examples • Solar installation to provide power to a rural small business or farm operation • Wood burning furnace to supply heat to the farm/construction shop • Anaerobic digester for a dairy operation to capture methane, convert it to electricity, and to sell to the local utility • Wind turbines producing electricity to power livestock buildings

38. Energy Efficiency Improvement Examples • Replace a grocery store’s coolers and freezers with high efficiency models. • Replace ventilation system in dairy barn • Purchase a high efficiency grain dryer to replace an older dryer. Applicant could be an agricultural producer or small grain elevator. • Replace old inefficient furnace in retail shop with high efficiency HVAC system.

39. Common Inquiries which are INELIGIBLE • Residential improvements • Most common request – Solar to power home on a farm • Projects for Schools, Communities or not-for-profits • Landfill projects (methane gas extraction) • Research and Development projects

40. Types of Financial Assistance • Grant Only • Up to 25% of total eligible costs • Guaranteed Loan Only • Up to 75% of total eligible costs • Combination Grant & Guaranteed Loan (Combo) • Up to 75% of total eligible costs (grant cannot exceed 25%)

41. Renewable Energy Minimum grant - $2,500 Maximum grant - $500,000 Minimum loan - $5,000 Maximum loan – $25 million Energy Efficiency Minimum grant - $1,500 Maximum grant - $250,000 Minimum loan - $5,000 Maximum loan – $25 million Funding Limits

42. REAP Projects

43. Cooperative Programs • Value Added Producer Grant (VAPG) • Rural Cooperative Development Grant (RCDG) • Rural Business Opportunity Grant (RBOG)

44. Value-Added Producer Grant Purpose: The Value-Added Producer Grant (VAPG) Program is intended to provide grant funds to agricultural producers for planning activities and working capital expenses to assist them in receiving a greater share of the consumer’s dollar for value-added agricultural products

45. Value-Added Producer Grant • VAPG Applicant Eligible Entities: • Independent Producer • Farmer or Rancher Cooperative • Agricultural Producer Group • Majority-Controlled Producer-Based Business Venture

46. VAPG Product Eligibility • Change in physical state (e.g. lamb chops, diced tomatoes) • Differentiated production or marketing (e.g. organic) - must reference a business plan • Product segregation (e.g. identity-preserved corn) • Farm-based renewable energy • Aggregation and marketing as a locally produced agricultural food product

47. VAPG Purpose Eligibility • Planning Grants ($100,000 maximum) - activities to determine the viability of a potential Value-Added venture including feasibility studies, marketing strategies, business plans and legal evaluations. • Working Capital Grants ($300,000 maximum) - to provide funds to operate ventures and pay the normal expenses of the venture including salaries, utilities, inventory, packaging, labels, and marketing expenses.

48. Rural Cooperative Development Grant Purpose: The Rural Cooperative Development Grant (RCDG) Program is intended to provide grant funds for establishing and operating Rural Cooperative Development Centers.

49. Rural Cooperative Development Grant Program Overview: • Provides grant funds for establishing and operating Rural Cooperative Development Centers. • Eligible applicants are non-profit organizations and institutions of higher learning. • Required matching funds equaling 25 percent of total project costs. • Maximum grant size $175,000

50. Rural Cooperative Development Grant Development Activities: • Startup, expansion or operational improvement of a cooperative. • Development activities include technical assistance, and research, educational, and advisory services. • Operational improvement includes making a cooperative more efficient or better managed.