Community Facilities Direct Loan and Grant Program
Applications accepted on an ongoing basis
USDA Rural Development (USDA RD)
Offers grants and low interest direct loans to help develop essential community facilities and services in rural communities. An essential community facility is a facility that provides an essential service to the local community for the orderly development of the community in a primarily rural area, and does not include private, commercial, or business undertakings. Funds can be used to purchase, construct, and/or improve essential community facilities, buy equipment, or pay necessary project costs. Examples of essential community facilities include:
- Healthcare facilities which includes hospitals, medical clinics, dental clinics, nursing homes, assisted living facilities, or facilities that offer substance use disorder (SUD) prevention, treatment, and recovery services
- Public facilities such as town halls, courthouses, airport hangars, bridges, port authorities, or street improvements
- Community support services such as child care centers, adult daycare, community centers, homeless shelters, fairgrounds, or transitional housing
- Public safety services including fire departments, police stations, prisons, police vehicles, fire trucks, and public works vehicles, or equipment
- Educational services such as schools, colleges and universities, community colleges, charter schools, vocational and technical schools, dormitories, museums, or libraries
- Local food systems such as community gardens, food pantries, community kitchens, food banks, food hubs, or greenhouses
- E-Connectivity end-user equipment such as distance learning equipment, telemedicine equipment, health information technology (HIT) equipment, internal wiring, and publicly accessible broadband capability within a facility
Amount of Funding
Grant awards are based on a graduated scale determined by the population and median household income of the service area. Smaller communities with lower household incomes are eligible for projects with a higher proportion of grant funds.
Maximum grant assistance is limited to the following amounts:
- 75% of eligible project costs when the proposed project is located in a rural community with a population of 5,000 or less and the median household income is below the higher of the poverty line or 60% of the state nonmetro median household income.
- 55% of eligible project costs when the proposed project is located in a rural community with a population of 12,000 or less and the median household income is below the higher of the poverty line or 70% of the state nonmetro median household income.
- 35% of eligible project costs when the proposed project is located in a rural community with a population of 20,000 or less and the median household income is below the higher of the poverty line or 80% of the state nonmetro median household income.
Direct loan repayment terms may not exceed the useful life of the facility, state statutes, the applicants authority, or up to 40 years, whichever is less. Interest rates are set by USDA Rural Development and are determined by the median household income of the service area. Interest rates are fixed once a project is approved.
Who Can Apply
Essential community facilities must be located in rural areas to be eligible. Under this funding opportunity, rural areas are defined as cities, villages, townships, and towns, including federally recognized tribal lands, with populations at or below 20,000 residents according to the latest U.S. Census Bureau data.
Eligible applicants include:
- Community-based nonprofit corporations with significant ties to the local rural community or region
- Public bodies
- Federally recognized tribes
Applicants must meet the following requirements:
- Have legal authority to borrow money, obtain security, repay loans, construct, operate, and maintain the proposed facilities
- Be unable to finance the project from their own resources and/or through commercial credit at reasonable rates and terms
- Facilities must serve a rural area where they are/will be located
- Demonstrate substantial community support
- Complete an acceptable environmental review
What This Program Funds
Buildings and Facilities • Capacity Building • Equipment
Application information, requirements, instructions, and forms are available on the program website.
Contact your local USDA Rural Development state office to discuss your specific project, determine which fund type best meets your needs, and start an application.
For program questions:
Contact the appropriate USDA Rural Development state office.
Topics This Program Addresses
Community Planning and Coalition Building • Healthcare Facilities • Housing and Homelessness • Infrastructure • Justice System • Schools • Teleservices and Technology