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RLF Conference April 10, 2007 11:15 AM: Track 1: How to Establish an RLF – Sources of Funding

RLF Conference April 10, 2007 11:15 AM: Track 1: How to Establish an RLF – Sources of Funding Randy Frescoln Business – Cooperative Program Director USDA Rural Development. Funds established. Revolving Loan Funds (RLF) are established through three USDA Rural Development Programs

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RLF Conference April 10, 2007 11:15 AM: Track 1: How to Establish an RLF – Sources of Funding

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  1. RLF Conference April 10, 2007 11:15 AM: Track 1: How to Establish an RLF – Sources of Funding Randy Frescoln Business – Cooperative Program Director USDA Rural Development

  2. Funds established • Revolving Loan Funds (RLF) are established through three USDA Rural Development Programs • Rural Business Enterprise Grant (RBEG) • Rural Economic Development Grant (REDG) • Intermediary Relending Program (IRP)

  3. Rural Business Enterprise Grant Established by nonprofit organizations and public bodies without an established commercial loan portfolio. • To assist small and emerging private business enterprises. • RLF size is typically smaller - $50,000 - $70,000

  4. Rural Economic Development Grant Established by Rural Electric Cooperatives and Rural Telephone Companies who borrower funds from the Agency’s Utility Programs. • To promote rural economic development and job creation projects. • RLF size is typically $300,000 - $400,000

  5. Intermediary Relending Program LOAN vs. Grant (1% - 30 years) • Established by nonprofit and public bodies with lending experience and existing commercial loan portfolio. • To alleviate poverty and increase economic activity and employment in rural communities. • RLF size is usually larger > $500,000

  6. In general, all Agency RLFs: • Include matching funds • Are administered in accordance with a RLF plan • Are used to provide gap financing • Require periodic reports to the Agency • Require ongoing oversight by the Agency

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