Business and Industry Loans

 

The purpose of the B&I Guaranteed Loan Program is to improve, develop, or finance business, industry, and employment and improve the economic and environmental climate in rural communities.

General information about this opportunity
Last Known Status
Active
Program Number
10.768
Federal Agency/Office
Agency: Department of Agriculture
Office: Rural Business-Cooperative Service
Type(s) of Assistance Offered
GUARANTEED/INSURED LOANS
Program Accomplishments
Not Applicable.
Authorization
Consolidated Farm and Rural Development Act, Section 310B, 7 U.S.C 1932, Section 310B, 7 U.S.C 1932.
Who is eligible to apply/benefit from this assistance?
Applicant Eligibility
A borrower may be a cooperative organization, corporation, partnership, or other legal entity organized and operated on a profit or nonprofit basis; an Indian tribe on a Federal or State reservation or other Federally recognized tribal group; a public body; or an individual.
Beneficiary Eligibility
N/A.
Credentials/Documentation
A complete application containing such items as credit reports, financial statements, and appraisals are required as part of the application. This program is excluded from coverage under OMB Circular No. A-87. This program is excluded from coverage under 2 CFR 200, Subpart E - Cost Principles.
What is the process for applying and being award this assistance?
Pre-Application Procedure
Preapplication coordination is not applicable. An environmental impact assessment is required for this program. This program is eligible for coverage under E.O. 12372, "Intergovernmental Review of Federal Programs." An applicant should consult the office or official designated as the single point of contact in his or her State for more information on the process the State requires to be followed in applying for assistance, if the State has selected the program for review.
Application Procedure
This program is excluded from coverage under 2 CFR 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards. This program is excluded from coverage under OMB Circular No. A-102. This program is excluded from coverage under OMB Circular No. A-110. Complete the requirements of RD Instruction 4279-B, section 4279.161(b).
Award Procedure
Applications are funded on a first-come first served basis according to priority points procedures outlined in RD Instruction 4279-B, section 4279.155.
Deadlines
Contact the headquarters or regional office, as appropriate, for application deadlines.
Approval/Disapproval Decision Time
Applications typically take 60 days to approve.
Appeals
Denial for program assistance is appealable.
Renewals
Not Applicable.
How are proposals selected?
Businesses must demonstrate the ability to repay the loan. Existing businesses must have 10 percent tangible balance sheet equity and new businesses must have 20 percent tangible balance sheet equity.
How may assistance be used?
The program guarantees lenders’ loans for real estate, machinery and equipment, working capital, and debt refinancing. Assistance is limited to rural areas. Some loan purposes such as golf courses, gambling, and agricultural production are restricted or limited. Guaranteed loan funds in the amount of 5 percent of the funds available each year through FY 2018 will be set aside for the locally or regionally produced agricultural food products initiative. Guaranteed loans are the only type of assistance under this program. For FY2014 the maximum guarantee fee was increased to 3%. A borrower may be a cooperative organization, corporation, partnership, or other legal entity organized and operated on a profit or nonprofit basis; an Indian tribe on a Federal or State reservation or other Federally recognized tribal group; a public body; or an individual. Guaranteed loan funds in the amount of 5 percent of the funds will be available each year until Management changes. These funds will be set aside for the locally or regionally produced agricultural food products initiative. Guaranteed loans are the only type of assistance under this program. For FY2013 the annual guarantee fee was increased from 1% to 3%.
What are the requirements after being awarded this opportunity?
Reporting
Guaranteed borrowers and guarantors are required to submit financial statements annually. No cash reports are required. No progress reports are required. Yes, but as part of the overall financial reporting requirement. Not duplication. The Agency monitors the number of jobs created and/or saved by the borrower.
Auditing
In accordance with the provisions of 2 CFR 200, Subpart F - Audit Requirements, non-Federal entities that expend financial assistance of $750,000 or more in Federal awards will have a single or a program-specific audit conducted for that year. Non-Federal entities that expend less than $750,000 a year in Federal awards are exempt from Federal audit requirements for that year, except as noted in 2 CFR 200.503. In accordance with the provisions of OMB Circular No. A-133 (Revised, June 27, 2003), "Audits of States, Local Governments, and Non-Profit 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. Nonfederal entities that expend less than $500,000 a year in Federal awards are exempt from Federal audit requirements for that year, except as noted in Circular No. A-133.
Records
The lender is required to maintain a complete loan file no differently than it would keep for a borrower without a guarantee. This includes annual financial statements, correspondence, servicing actions, etc. The file may be inspected at the Agency’s request.
Other Assistance Considerations
Formula and Matching Requirements
Statutory Formula: 7 CFR Parts 4279 and 4287.
This program has no matching requirements. This program has no matching requirements. This program has MOE requirements, see funding agency for further details.
This program has MOE requirements, see funding agency for further details.
Length and Time Phasing of Assistance
Assistance is available each fiscal year until September 30 or until expended, whichever occurs first. See the following for information on how assistance is awarded/released: Lender’s loans are guaranteed so funds are not really “released”.
Who do I contact about this opportunity?
Regional or Local Office
See Regional Agency Offices. Regional Agency Offices: http://www.rd.usda.gov/contact-us/state-offices.
Headquarters Office
B&I Processing Branch U.S. Department of Agriculture
Rural Business-Cooperative Service
1400 Independence Ave SW, Stop 3224, Washington, District of Columbia 20250-3224 Phone: 202-690-4103
Website Address
http://www.rd.usda.gov/programs-services/business-industry-loan-guarantees
Financial Information
Account Identification
12-0403-0-1-452; 12-4155-0-3-452.
Obligations
(Guaranteed/Insured Loans) FY 14 $1,084,020,173; FY 15 est $590,800,000; and FY 16 est $758,200,000
Range and Average of Financial Assistance
No Data Available.
Regulations, Guidelines and Literature
The Business and Industry Guaranteed Loan Program regulations are being updated. The regulation is in the final clearance process and it is anticipated that the regulation will be published in the 1st quarter of FY 2016.
Examples of Funded Projects
Fiscal Year 2014: No Current Data Available Fiscal Year 2015: No current data available. Fiscal Year 2016: No Current Data Available

 


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