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WEDA Winter Conference January 11, 2011

WEDA Winter Conference January 11, 2011 . Community Programs Funding FY 2010. WEP CF Direct Loan $7,148,000 $1,820,000 Grant 2,429,000 97,000 Guaranteed 891,000 1,280,000 ** Match is not required, but leveraging is encouraged to maximize our allocations. .

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WEDA Winter Conference January 11, 2011

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  1. WEDA Winter ConferenceJanuary 11, 2011

  2. Community ProgramsFunding FY 2010 WEP CF • Direct Loan $7,148,000 $1,820,000 • Grant 2,429,000 97,000 • Guaranteed 891,000 1,280,000 **Match is not required, but leveraging is encouraged to maximize our allocations.

  3. Funding Example WWDC Loan $1,048,000 WWDC Grant 1,248,000 State Funding = 44.7% MRG 1,000,000 AMG 1,887,239 RD Funding = 40.8% SRLF 1,406,761 RD Loan 3,000,000 Applicant Funds = 14.5% RD Grant 3,000,000 Applicant 2,130,000 Total Cost $14,720,000 Rural Utilities Program

  4. Community Facilities Programs • Guaranteed Loans • Direct Loans • Grants Community Facilities Programs

  5. What is an essential Community Facility? • One that is needed for the orderly development of the community. • Serves the local community and is a function that is typically provided by some branch of government. • This cannot include any private or commercial undertakings. Community Facilities Programs

  6. WHO MAY RECEIVE ASSISTANCE ? • Public Bodies: • Cities, Counties or Special Purpose Districts • Indian Tribes • Non-Profit Corporations • Population Limits: • Towns up to 20,000 population (2000 Census) • In Addition, Borrowers must: • Have the legal authority to borrow and repay loans, to pledge security for loans, and to construct, operate, and maintain the facility or services. • Be financially sound and be able to organize and manage the facility effectively. • Be unable to obtain needed funds from other sources at reasonable rates and terms. Community Facilities Programs

  7. Authorized CF Loan/ Grant Purposes • To construct, enlarge, extend, or otherwise improve essential community facilities providing essential service primarily to rural residents. • Heath Services • Community, Social, or Cultural Services • Transportation Facilities • Industrial Parks

  8. CF Maximum Loan, Rates, and Terms • No maximum dollar amount. Loan based on applicant’s needs and ability to repay. • Interest Rates are dependent upon Median Household Income for the service area - rates are set quarterly based on the current GO Bond index. Lowest rate available 4.25%. • Maximum Term - 40 years, State Statute, or useful life of facility, whichever is less

  9. CF Grants *Grant assistance may be available for up to 75% of project costs. A scale has been developed to predetermine grant funding limitations based on population and income. Most communities in Wyoming only qualify for 15 to 35% grant assistance. * Further limited to the minimum amount sufficient to provide economic feasibility to the proposed project and either $50,000 or 50 % of a States annual allocation whichever is greater.

  10. Rural Utilities Programs • Water and Waste Disposal Loan and Grant • Water and Waste Disposal Loan Guarantee • Solid Waste Management Grant Rural Utilities Program

  11. Water and Environmental Programs (WEP) • Water & Waste Disposal Loans/Grants • Solid Waste Management Grants • Technical Assistance & Training Grants • Rural Water Circuit Rider/Technical Assistance • Wyoming Association of Rural Water Systems (WARWS) • Midwest Assistance Program (MAP)

  12. WEP - Eligibility Criteria • Non-profit Associations, Indian Tribes & Public Entities - municipalities, counties, special purpose districts and authorities, joint powers boards • Rural areas / service area with populations of less than 10,000 • Be unable to obtain credit elsewhere

  13. WEP - Eligibility Criteria (Continued) • Have the legal capacity to borrow and repay the loan, to pledge security, to own and operate the proposed system • Be financially sound and able to manage the facility effectively.

  14. WEP Authorized Loan/Grant Purposes • Construct, repair, improve, expand, or otherwise modify rural water supply and distribution including pipelines, hydrants, pumping stations, treatment, and storage • Acquire water supply or water rights (i.e..: reservoirs, wells)

  15. WEP Authorized Loan/Grant Purposes (Continued) • Construct, repair, improve, expand, or otherwise modify waste collection, pumping, treatment, or other disposal facilities • Related soft costs (i.e.: engineering, legal, ROWs, land acquisition, bond counsel, accounting costs)

  16. WEP Maximum Loan, Rates, and Terms • No maximum dollar amount. Loan based on applicant’s needs and ability to repay. • Interest Rates are dependent upon Median Household Income for the service area - rates are set quarterly based on the current GO Bond index. Lowest rate available 2.50%. • Maximum Term - 40 years, State Statute, or useful life of facility, whichever is less

  17. WEP Loan and Grant Limitations • Grants awarded where necessary to help achieve reasonable user rates: • Maximum grant consideration is 75% where MHI is below $30,215 (poverty level) Must alleviate health and safety issues. • Maximum grant consideration if 45% where MHI is between $30,215 to $37,769 (intermediate level) • No grant funds where MHI is $37,769 or greater (market rate)

  18. THE PROCESS • PRE-APPLICATION PHASE: • Determine Applicant’s eligibility (review of organizational documents) • ENVIRONMENTAL REVIEW PROCESS Environmental assessment of project location (30 - 120 days depending on type of Class Action) Agency prepares for CF and independent consultant for WEP • FORMAL APPLICATION PHASE: • Preliminary Engineering/Architectural Report (PER) to determine project feasibility • formalize agreements with architect or engineer • Financial Feasibility Study • Public Meeting - Community Consensus • Funds Obligated, letter of Conditions issued • Interim financing Arrangements made for construction period • loan closed and funds disbursed after final inspection and acceptance of project

  19. Criticisms of RD Funding • RD review of project scope, design, and costs in addition to DEQ’s approval • Environmental- Mitigation measures to protect farmland, wetlands, and floodplains • Requirement for Municipal Bonds for Public Bodies- 10% Debt Reserve Fund (Revenue Bond)

  20. Advantages of RD Funding • Low interest rates • Longest fixed rate term available • Matching funds for State Grants • Commitment prior to authorizing design • No fees for RUS services • RUS’s commitment to customer service • No pre-payment penalties

  21. Best Practices for RD Funding • Get RD involved early in the project development! • Board/ Council needs to be engaged in the process. • Communication is critical.

  22. Thank you! • Contact Information: Alana Cannon Community Programs Director USDA Rural Development PO Box 11005 Cheney Federal Building Casper, WY 82602 307.233.6709

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