Rural Electrification Loans and Loan Guarantees (10.850)
Program
10.850 Rural Electrification Loans and Loan Guarantees
Federal Agency
RURAL UTILITIES SERVICE, DEPARTMENT OF AGRICULTURE
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 central station 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 not receiving central station electric service, and 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
None. This program is excluded from coverage under OMB Circular No. A-87, "Cost Principles for State, Local and Indian Tribal Governments."
Application and Award Process
Preapplication Coordination
Applicants must supply environmental impact information to determine whether an environmental impact assessment or an environmental impact statement will be required. This program is excluded from coverage under E.O. 12372 and OMB Circular No. A-102, "Grants and Cooperative Agreements with State and Local Governments."
Application Procedure
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
None.
Range of Approval/Disapproval Time
Appeals
Not applicable.
Renewals
Not applicable.
Assistance Considerations
Formula and Matching Requirements
Under certain conditions, obtaining an RUS insured electric loan 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.
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.
Post Assistance Requirements
Reports
RUS borrowers must submit to the Rural Utilities Service regularly scheduled operating reports showing financial condition and operating progress.
Audits
In accordance with the provisions of OMB Circular No. A- 133 (Revised, June 24, 1997), "Audits of States, Local Governments, and Nonprofit Organizations," nonfederal entities that expend financial assistance of $300,000 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
From October 1999 to September 30, 2001, 51 direct loans and 100 loan guarantees were made.
Financial Information
Account Identification
12-1230-0-1-271; 12-4230-0-3-271.
Obligations
(Direct Loans) FY 02 $416,536,557; FY 03 est $916,500,000; and FY 04 est $915,486,465. (Guaranteed FFB) FY 02 $1,700,000,000; FY 03 est $1,700,000,000; and FY 04 est $1,700,000,0000.
Range and Average of Financial Assistance
Fiscal year 2001: Direct Loans - $443,000 to $103,000,000; $8,167,383 average. Direct, FFB guarantees - $698,000 to $269,940,000; $17,000,000 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
Administrator, Rural Utilities Service, Department of Agriculture, Washington, DC 20250-1500. Telephone: (202) 720-9540. Use the same number for FTS.
Web Site Address
Examples of Funded Projects
Not applicable.
Criteria for Selecting Proposals
Not applicable.
