Presentation: Community Facilities Direct Loans and Grants

Rural Development
Community Facilities Direct Loans and Grants
(USDA Rural Development Community Programs)

Essential Community Facilities

• Serves the local community
• Needed for the orderly development of community
• May not include private or commmercial undertakings

Eligible Areas

• Must be located in a rural area
• Population of 20,000 or less
  - Cities
  - Towns
  - Unincorporated areas

Eligible Organizations

• Public Bodies
• Federally-Recognized Indian Tribes
• Non-Profit Corporations

Significant Community Support

• Broadly-based board representing the community served
• Public funding through taxes, fund raising, etc.
• Support by local public body

Legal Authority

• Must be able to own, operate, construct & maintain facility
• Legal ability to incur & repay debt

Test for Other Credit

• Unable to obtain credit elsewhere
• Reasonable rates and terms

Community Facilities (CF) Direct Loan

Loan Terms
- Useful life of the facility
- Maximum 40 years
- No Balloon payments
- Subject to State Limitations

CF Direct Loan Interest Rates

• Rates adjusted quarterly
• Tied to Bond Buyer Index
• Interest rates:
  - Poverty
  - Intermediate
  - Market

CF Direct Loans

• FY 2006, we provided 574 CF direct loans for over $394 million.
• FY 2006 – Average loan size - $686,882.
• In FY 2007, we have $297 million in CF Direct loan program authority.

CF Grants

• Feasibility analysis completed to determine need
• Primary used for Equipment purchases
• Grant determination – sliding scale based on population and MHI

CF Grants

• In FY 2006 – 563 CF grants made for over $17.9 million
• In FY 2006, average size grant $31,956
• In FY 2007, we have $17.9 million in grant authority

Special Initiative: Economic Impact Initiative Grants

• $17 million available in FY 2007
• Areas with extremely high unemployment & economic depression

Community Facilities - FY 2007 Appropriations

• Direct Loans: $297 Million
• Grants: $17 Million

Community Facilities Projects

Project categories in FY 2006:

• Health Care
• Public Safety
• Educational
• Public Facilities
• Other

Health of the CF Direct Loan Portfolio

• Total Outstanding Direct Loan
  - Portfolio: $2.3 Billion
  - Borrowers: 3,422
  - Loans: 4,898
• Delinquency Rate: 2% (as of 3/30/07)

Application Process

• Applicants submits pre-application to RD field office.
• Contact field office: http://www.rurdev.usda.gov
  (Click on State Office for address & phone number)

Types of Projects Financed

Examples of Health Care Facilities Financed

• Hospitals
• Assisted Living
• Nursing Homes
• Clinics
• Office Buildings (Health Care)

Examples of Public Safety Facilities Financed

• Fire Stations
• Fire Trucks
• Ambulances
• Police Stations
• Rescue and Ambulance Buildings

Examples of Educational Facilities Financed

• Public Schools
• Charter School
• Colleges
• Library
• Vocational Schools

Examples of Other Facililties Financed

• Child or Adult Day Care
• Homeless Shelters
• Domestic Violence Shelter
• Community Centers
• Office Buildings

CF Contact

Chad Parker
Mail Stop 0787
1400 Independence Avenue
Washington, DC 20250
Telephone: (202) 720-1502
Email: chad.parker@wdc.usda.gov
Website: http://www.rurdev.usda.gov

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