Agriculture Secretary Tom Vilsack today unveiled an innovative partnership with community development organizations from across the country, providing $401 million of Community Facilities program funds to recipients with a track record of successful programs to help reduce poverty in some of the nation’s poorest and most isolated rural communities. Twenty-six community development organizations have been approved to draw upon the funding to provide long-term, low-interest financing to be “re-lent” to local entities to build, acquire, maintain or renovate essential community facilities. The funds also can be used for capacity building and to finance essential community services, such as education, health care and infrastructure.
“This effort builds on our commitment to lifting up the economic prospects of communities that have not benefited from the revitalization of rural America,” Vilsack said. “By engaging with local and national partners, private-sector financial institutions and philanthropic organizations, USDA will inject a game-changing level of investment capital to reduce poverty in targeted rural areas where the capacity for growth has not been realized. As we have seen with the Obama Administration’s Promise Zone initiative and USDA’s StrikeForce effort, targeted, place-based investments can have a real impact on reducing poverty. This funding adds another important tool in that fight.”
The financing has two unique features. First, private financial institutions, including Bank of America and others, will be providing guarantees for a portion of the loans. Second, the recipient community development organizations, or “re-lenders,” may also have an opportunity to secure grants provided by seven of the nation’s premier philanthropic organizations through a $22 million fund to assist in managing and capacity building. The Mary Reynolds Babcock Foundation will manage this grant fund.
CEN-TEX Certified Development Corporation received a $5 million Community Facilities loan to re-lend the funds for eligible community facility projects primarily in persistent poverty counties and high poverty areas in rural Texas.
“USDA is pleased to provide Community Facilities funding to CEN-TEX Certified Development Corporation to help communities in rural Texas create jobs, stimulate local economies and provide improved public services to their residents,” said Paco Valentin, USDA Texas State Director. “This funding will help rural areas keep pace with the needs of their rising populations.”
Since 2009, USDA Rural Development has funded nearly 9,200 community facilities such as schools, public safety and health care facilities; invested nearly $13 billion to start or expand nearly 112,000 rural businesses; helped 1.1 million rural residents buy homes; and helped bring high-speed Internet access to nearly 6 million rural residents and businesses. USDA also has invested $31.3 billion in 963 electric projects that have financed more than 185,000 miles of transmission and distribution lines serving 4.6 million rural residents. For more information, visit www.usda.gov/results.
To read more about USDA’s investments in rural America and its successful turnaround, visit USDA's entry on Medium.com, Rural America Is Back in Business.