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USDA offers rural development loan programs

In the midst of the most difficult economic time in recent memory, Archuleta County governmental entities, non-governmental organizations (NGOs) and individual residents can take advantage of over 40 loan programs made available through the USDA’s Rural Development program.

All programs are specific to rural areas with populations of 50,000 or less for some programs, populations of 20,000 or less for others.

“In Fiscal Year 2009, we invested over $400 million statewide through our programs,” said Amy Mund, public information coordinator for the USDA’s Rural Development program.

For individual residents, most of the programs involve grants or loans to either provide low-cost housing or make improvements to existing housing. Several programs are in place to assist low-income families build homes, either through grant programs or through low-interest loans.

For instance, Single Family Home Ownership Direct Loans (Section 502) exists to help low-income families “Buy, build, improve, repair or rehabilitate rural home as the applicant’s primary residence” with a loan of up to 100 percent of the market value on either the cost of rehabilitating an existing structure or cost of constructing a new home. The loan is amortized for a period of 33-38 years and applicants may be eligible for payment assistance on the loan.

Other loan programs are also available to low-income families, negotiated with a lender, at a fixed 1-percent interest rate.

Grants and loans also exist for low-income families to help in home repairs (roofs, heating systems, structural repairs, etc.), as well as winterization and energy efficiency improvements.

A few of the USDA’s Rural Development housing programs are set aside for organizations (such as non-profits), one offering grants for cooperative housing construction in which low-income families assist one another in building each other’s homes. A grant program that could be of interest to the newly formed Pagosa Springs Economic Development Corporation is the Rural Community Development Initiative which states that, “(F)unding used to build capacity of ultimate recipients to undertake projects for housing and economic development in rural areas.”

The Pagosa CDC might also take interest in a few of the USDA’s Rural Development business and cooperative programs, such as Rural Business Enterprise Grants (“Buy and develop land, establish a revolving loan fund, construct buildings, plants, equipment access streets and roads, parking areas, utilities and service extensions, and rural distance learning networks.”) as well as Intermediary Relending Program Loans which provides for “Community development projects, establishment or expansion of businesses, creation and saving of rural jobs.” Likewise, the Rural Business Opportunity Grants program could provide seed money for PS CDC endeavors as it provides for the establishment of economic development plans as well as technical assistance, leadership training and developing support for small business through community economic development.

Not all of the business and cooperative programs are specified for non-profits or other NGOs and are available to local business owners. The Business and Industry Guarantee Loans program is available for business and start-up and expansion for the purpose of creating jobs in rural areas. Likewise, the Value-Added Agricultural Product Market Development Grant program is available to independent agricultural based businesses to “enter into activities that add value to their commodities” and offer grants for conducting feasibility studies or working capital for proposed ventures.

The USDA’s Rural Development community programs are specified for public entities, as well as NGOs and non-profits. In fact, the Pagosa Springs Sanitation and General Improvement District recently took steps to apply for a combination of a grant and loan offered by this program to fund a new wastewater treatment plant.

“The competition is pretty keen,” said Pagosa Springs Town Manager David Mitchem. “My understanding is that a lot of folks are applying for that money.”

Nonetheless, Mitchem was confident that the district stood a good chance in securing the USDA Rural Development funds based on need and progress on the project.

“On that basis (need), we’ll compete strongly and as far as shovel-ready, we’ll compete strongly,” Mitchem said.

Likewise, the Town of Pagosa Springs has also looked into pursuing the Rural Broadband Loans and Grants Guarantees program to help offset the expense of a required match for the recently awarded grant from the Colorado Governor’s Energy Office.

With over 40 loan and grant opportunities available through the USDA’s Rural Development programs, dozens more exist to assist Archuleta County residents, small businesses and public entities, NGOs and non-profits — many more than can be listed here. For a complete list of programs, visit www.rurdev.usda.gov/Home.html and click on links to programs of interest. For questions regarding community programs, call USDA Area Specialist Duane Dale at (970) 565-8416, Ext. 4. Questions regarding business and cooperative questions can be answered by calling USDA Area Specialist Linda Johansen at (970) 589-5661, Ext. 116.

Answers regarding either community or business and cooperative programs, as well as assistance in pursuing loan or grant opportunities, are offered through the Region 9 Economic Development District of Southwest Colorado, Inc., by calling 247-9621.

Finally, applicants interested in pursuing grants or loans for the USDA’s Rural Development single family and multi-family housing programs can be answered by calling Tiffany Huff at (970) 565-8416, Ext. 4.

jim@pagosasun.com