The U.S. Department of Agriculture (USDA) Rural Development is making available up to $1 billion in loan guarantees nationwide to help rural businesses meet their working capital needs during the coronavirus pandemic. Funding is also available to agricultural producers that are not eligible for USDA Farm Service Agency loans.
The Business & Industry (B&I) Program increases access to capital for rural businesses by guaranteeing loans made by private lenders. Loans receiving a guarantee under provisions that were included in the Coronavirus Aid, Relief, and Economic Security (CARES) Act must be used as working capital to prevent, prepare for, or respond to the effects of the coronavirus pandemic. The Business & Industry CARES Act Program may be used only to support rural businesses, including agricultural producers, that were in operation on February 15, 2020.
In addition to expanding eligibility to certain agricultural producers, the new CARES Act portion of the B&I Program allows USDA to:
- Provide 90 percent guarantees on B&I CARES Act Program loans;
- Set the application and guarantee fee at two percent of the loan;
- Accept appraisals completed within two years of the loan application date;
- Not require discounting of collateral for working capital loans; and
- Extend the maximum term for working capital loans to 10 years.
Rural Development intends to consider applications in the order they are received. However, the agency may assign priority points to projects if the demand for funds exceeds availability.
Applications will be accepted through September 15, 2021, or until funds are expended.
To discuss a potential application, contact Nathan Brown, Business and Cooperative Programs Specialist, (541) 801-2685. Additional information is also available on page 31139 of the May 22, 2020, Federal Register.