Community Facilities Direct Loan and Grant

This program provides affordable funding to develop essential community facilities in rural areas. An essential community facility is defined as a facility that provides an essential service to the local community for the orderly development of the community in a primarily rural area, and does not include private, commercial, or business undertakings.

Eligible Borrowers

1. Eligible borrowers include:

A. Public bodies

B. Community-based non-profit corporations

C. Federally recognized Tribes

2. Applicants must have legal authority to borrow money, obtain security, repay loans, construct, operate, and maintain the proposed facilities.

3. Applicants must be unable to finance the project from their own resources and / or through commercial credit at reasonable rates and terms.

4. Facilities must serve rural area where they are/will be located.

5. Project must demonstrate substantial community support.

6. Environmental review must be completed/acceptable.

7. Applicant must be eligible for grant assistance, which is provided on a graduated scale with smaller communities with the lowest median household income being eligible for projects with a higher proportion of grant funds. Grant assistance is limited to the following percentages of eligible project costs:

A. Maximum of 75 percent when the proposed project is:

Located in a rural community having a population of 5,000 or fewer; and

The median household income of the proposed service area is below the higher of the poverty line or 60 percent of the State nonmetropolitan median household income.

B. Maximum of 55 percent when the proposed project is:

Located in a rural community having a population of 12,000 or fewer; and

The median household income of the proposed service area is below the higher of the poverty line or 70 percent of the State nonmetropolitan median household income.

C. Maximum of 35 percent when the proposed project is:

Located in a rural community having a population of 20,000 or fewer; and

The median household income of the proposed service area is below the higher of the poverty line or 80 percent of the State nonmetropolitan median household income.

D. Maximum of 15 percent when the proposed project is:

Located in a rural community having a population of 20,000 or fewer; and

The median household income of the proposed service area is below the higher of the poverty line or 90 percent of the State nonmetropolitan median household income. The proposed project must meet both percentage criteria. Grants are further limited.

8. Funds must be used to purchase, construct, and / or improve essential community facilities, purchase equipment and pay related project expenses.

Examples of essential community facilities include:

Health care facilities such as hospitals, medical clinics, dental clinics, nursing homes or assisted living facilities

Public facilities such as town halls, courthouses, airport hangars or street improvements

Community support services such as childcare centers, community centers, fairgrounds or transitional housing

Public safety services such as fire departments, police stations, prisons, police vehicles, fire trucks, public works vehicles or equipment

Educational services such as museums, libraries or private schools

Utility services such as telemedicine or distance learning equipment

Local food systems such as community gardens, food pantries, community kitchens, food banks, food hubs or greenhouses

National Architect Requirements

Applicants, at the earliest possible time, should provide a Preliminary Architectural Feasibility Report, including the Cost Estimate, for the review by the RD Area Loan Specialist and RD State Architect. These two documents are needed to determine the project's feasibility. RD's State Architect will evaluate and provide architectural/construction guidance to the Applicants and their Architects, for RD financed architectural projects, in the following areas:

Initial site visit & evaluation of the proposed project

Preliminary Architectural Feasibility Report

Agency concurrence of Owner/Architect Agreements

Agency acceptance of Plans & Specifications

Agency concurrence of Construction Contract documents

Construction & construction monitoring

To start the application, please select the type of your project: