Rural Electrification Loans and Loan Guarantees (10.850)
Program
10.850 Rural Electrification Loans and Loan Guarantees
Federal Agency
Agency: Department of Agriculture
Office: Rural Development
Authorization
Rural Electrification Act of 1936, as amended, 7 U.S.C. 901-950.
Program Number
10.850
Last Known Status
Active
Objectives
To assure that people in eligible rural areas have access to electric services comparable in reliability and quality to the rest of the Nation.
Types of Assistance
DIRECT LOANS
Uses and Use Restrictions
Long-term, direct loans and loan guarantees to qualified organizations for the purpose of supplying or improving inadequate or unreliable electric services on a continuing basis in rural areas.
Eligibility Requirements
Applicant Eligibility
Rural electric cooperatives, public utility districts, power companies, municipalities, and other qualified power suppliers including those located in the U.S. Territories.
Beneficiary Eligibility
Persons in rural areas who do not have electric service, have inadequate or unreliable electric service, or those currently served through RUS financing. Rural areas are defined in the Rural Electrification Act as any area of the United States not included within the boundaries of any urban area as defined by the Bureau of the Census. Such term shall be deemed to include both the farm and nonfarm populations.
Credentials/Documentation
No Credentials or documentation are required. This program is excluded from coverage under OMB Circular No. A-87.
Application and Award Process
Preapplication Coordination
Preapplication coordination is required. An environmental impact statement is required for this program. An environmental impact assessment is required for this program. This program is excluded from coverage under E.O. 12372.
Application Procedure
This program is excluded from coverage under OMB Circular No. A-102. This program is excluded from coverage under OMB Circular No. A-110. Applications for direct loan and loan guarantees are made by resolution of the board of directors of the borrowing organization. Information on submitting applications is contained in 7 CFR Part 1710 and 1714. This program is excluded from coverage under OMB Circular No. A-110, "Uniform Administrative Requirements for Grants and Agreements with Institutes of Higher Education, Hospitals and other Nonprofit Organizations."
Award Procedure
Depending on the amount of the application, the RUS Administrator, Assistant Administrator, or appropriate Regional Director makes the final decision on approval of the loan upon a finding that it is economically feasible and serves the purposes of the Rural Electrification Act. Borrowers and Members of Congress are notified of the approval of a loan or loan guarantee directly, and the public is notified through normal media communications.
Deadlines
Not Applicable.
Range of Approval/Disapproval Time
Direct loans are approved generally on an average of 3 to 6 months as funding becomes available. Loan guarantees are approved generally on an average of 9 to 12 months.
Appeals
Not Applicable.
Renewals
Not Applicable.
Assistance Considerations
Formula and Matching Requirements
This program has no statutory formula.
Matching Requirements: Under certain conditions, obtaining a municipal rate will require obtaining a concurrent loan (of 10, 20, or 30 percent of the total amount required) from a supplemental financing source. The factors used for determining the amount of concurrent financing required are set forth in 7 CFR 1710.110.
MOE requirements are not applicable to this program.
Length and Time Phasing of Assistance
Direct loans are generally made for a period up to 35 years, that approximates the expected useful life of the facilities financed. Provision is normally made for advances to be completed within 4 years, but this period is subject to extension if required. Advances of funds are made as required by the borrower. The terms and conditions of loan guarantees are negotiated between the borrower and the non-RUS lender, subject to RUS approval. See the following for information on how assistance is awarded/released: Direct loans are generally made for a period up to 35 years, that approximates the expected useful life of the facilities financed. Provision is normally made for advances to be completed within 4 years, but this period is subject to extension if required. Advances of funds are made as required by the borrower. The terms and conditions of loan guarantees are negotiated between the borrower and the non-RUS lender, subject to RUS approval.
Post Assistance Requirements
Reports
Program reports are not applicable. Cash reports are not applicable. RUS borrowers must submit to the Rural Utilities Service regularly scheduled operating reports showing financial condition and operating progress. Expenditure reports are not applicable. Performance monitoring is not applicable.
Audits
This program is excluded from coverage under OMB Circular No. A-133. In accordance with the provisions of OMB Circular No. A-133 (Revised, June 27, 2003), "Audits of States, Local Governments, and Nonprofit Organizations," nonfederal entities that expend financial assistance of $500,000 or more in Federal awards will have a single or a program-specific audit conducted for that year. All other RUS borrowers have their books audited annually by a Certified Public Accountant. Information on audits of RUS borrowers is contained in 7 CFR Part 1773.
Records
RUS borrowers keep the records prescribed for utility companies by the RUS uniform system of accounts, and by sound business practices.
Program Accomplishments
Not Applicable.
Financial Information
Account Identification
12-4230-0-3-271; 12-1230-0-1-271.
Obligations
(Direct Loans) FY 08 $99,300,000; FY 09 est $100,000,000; FY 10 est $100,000,000. (Guaranteed/Insured Loans) FY 08 $6,500,000,000; FY 09 est $6,500,000,000; FY 10 est $6,500,000,000
Range and Average of Financial Assistance
Direct Loans: $772,000 to $1,000,000,000 $23,664,000 Average.
Guaranteed FFB: $334,600 to $82,448,000 $12,924,000 average.
Regulations, Guidelines and Literature
7 CFR XVII. RUS publishes and issues upon request bulletins bearing on the financing, construction, operation, and maintenance of rural electric systems. Also available are annual statistical summaries; and the Rural Electrification Act of 1936, as amended.
Related Programs
10.854 Rural Economic Development Loans and Grants
Information Contacts
Regional or Local Office
None.
Headquarters Office
Rural Utilities Service Department of Agriculture, Washington, District of Columbia 20250-1500 Phone: (202) 720-9540
Web Site Address
Examples of Funded Projects
Not Applicable.
Criteria for Selecting Proposals
Not Applicable.
