Community Facilities Guaranteed Loan Program in Iowa

PROGRAM STATUS:

Open

One RD Guarantee

Beginning Oct. 1, 2020, this program will be streamlined under the OneRD Guarantee Loan Initiative. For more information, visit www.rd.usda.gov/onerdguarantee

Fees and Population Factsheet | PDF

What does this program do?
This program provides loan guarantees to eligible private lenders to help build essential community facilities in rural areas.
An essential community facility is defined as 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.

Who may apply for this program?
Private lenders may apply for a loan guarantee on loans made to an eligible borrower that is unable to obtain the needed commercial credit on reasonable terms without the guarantee.  
Eligible borrowers:

What is an eligible area?

Rural areas include any area other than a city or town with a population of greater than 50,000 inhabitants and any urbanized area contiguous and adjacent to that city or town based on the latest U.S. Census Data.  Check an eligible rural area

How may funds be used?|
Each year the Agency will reserve funds for projects located in rural areas with a population of not more than 20,000 inhabitants based on the following reservation of funds schedule:
(1)   100% of the first $200,000,000 made available
(2)   50% of the next $200,000,000 made available
(3)   25% of all amounts exceeding $400,000,000 made available

Funds can be used to purchase, construct, and / or improve essential community facilities, purchase equipment and pay related project expenses.

Examples of essential community facilities include:

  • Health care facilities such as hospitals, medical clinics, dental clinics, nursing homes or assisted living facilities
  • Public facilities such as town halls, courthouses, airport hangers or street improvements
  • Community support services such as child care centers, community centers, fairgrounds or transitional housing
  • Public safety services such as fire departments, police stations, prisons, police vehicles, fire trucks, public works vehicles or equipment
  • Educational services such as museums, libraries or private schools
  • Utility services such as  telemedicine or distance learning equipment
  • Local food systems such as community gardens, food pantries, community kitchens, food banks, food hubs or greenhouses

For a complete list see Code of Federal Regulations 7 CFR 3575.24.

What are the terms of a loan guarantee?

  • Maximum guarantee = 90% of the eligible loan
  • One-time guarantee fee = 1.5% of principal loan amount times the % of guarantee
  • Annual renewal fee = .5% of outstanding principal as of December 31st times % of guarantee.
  • Repayment term: useful life of the facility, state statute or 40 years, whichever is less and is negotiated between the lender/borrower, subject to USDA approval
  • Interest rates: fixed or variable as negotiated between the lender/borrower, subject to USDA approval
  • Loan note guarantee issued upon project completion/when conditions are met
  • Combination of guaranteed loans, direct loans, grants and commercial financing may be used to finance one project if all eligibility and feasibility requirements are met
  • Balloon payments and renewable notes are prohibited

Are there additional requirements?

  • Applicants must have legal authority to borrow money, obtain security, repay loans, construct, operate, and maintain the proposed facilities
  • Applicants must be unable to finance the project from their own resources and/or through commercial credit at reasonable rates and terms
  • Tax exempt financing is not eligible for this program
  • Lender responsible for determining credit quality and economic feasibility of proposed loan; adequacy of equity, cash flow, security, history and management capabilities
  • Facilities must serve rural area where they are /will be located
  • Project must demonstrate substantial community support
  • Environmental review must be completed/acceptable

Who will service the loan?
The private lender that makes the loan will service the loan.

How do we get started?

  • Lenders: contact your local RD office for details on how to become an approved lender
  • Borrowers: ask your private lender if they participate in USDA Loan Guarantee Programs
  • Applications for this program are accepted year round
  • Program resources are available online (includes forms needed, guidance, certifications)

 
Who can answer questions?
Contact your local RD office.

What governs this program?
Fees and Population FY20 Notice
Code of Federal Regulation, 3575 Subpart A.

NOTE: Because citations and other information may be subject to change please always consult the program Instructions listed in the section above titled "What Law Governs this Program?" You may also contact your local office for assistance.

Application Documents:

  • SF 424, Application for Federal Assistance

  • RD 3575-1, Application for Loan and Guarantee

  • Applicant’s Organizational Documents (Nonprofit Organizations Only)

  • List of the Board of Directors/Officers

  • Evidence of Community Support from the affected local government body (Nonprofit Organizations Only) IA Sample A-3

  • Applicant’s current and previous year’s financial and income statements (RD 442-2 and RD 442-3 or similar format may be used)

  • Applicant’s operating budget for the current fiscal year((Form RD 442-2 or similar format may be used)

  • Lender’s disclosure of conflicts of interest, if applicable

  • Environmental Assessment - Please contact your local area office to determine the level of environmental assessment required.  Early submittal recommended. Funding cannot be determined until environmental review is complete.

  • Preliminary Architectural/Engineering Report – including project plans, cost estimates and projected sources of funds.

  • Financial Feasibility Report

  • Lender’s credit evaluation including a narrative statement outlining the organization’s services, scope of operation, geographical area served and any management agreements/leases.

  • Proposed loan agreement

  • Appraisal (if required by lender)

  • Credit Report (if required by lender)

  • AD-3030, Representation Regarding Felony Conviction or Tax Delinquent Status (Nonprofit organizations only)

    Survey on Ensuring Equal Opportunity for Applicants (optional)

NOTE: If state specific forms are not shown above, please ensure that your state is selected in the dropdown menu above to find the State Office contact information and speak to a Community Programs Specialist before attempting to fill out any forms or applications. This will save you valuable time in your application.

Interest Rates

Interest rates are negotiated between the lender and the borrower, subject to USDA approval.

National Architect Requirements:

Individual states may have particular requirements based on state and local regulations. Please select your state in the dropdown menu above to find your local contact for this program.

National Engineering Requirements:

Individual states may have particular requirements based on state and local regulations. Please select your state in the dropdown menu above to find your local contact for this program.

State Environmental Requirements:

Environmental Assessments

Air Quality

Project emissions, including those created by potential secondary beneficiaries, shall be examined for conformance to the Clean Air Act and the Environmental Protection Agency's National Primary and Secondary Ambient Air Quality Standards.
Iowa has two "non-attainment" areas. The following link from EPA lists all the nonattainment areas: http://www.epa.gov/airquality/greenbook/

For questions contact Air Quality Helpline with Iowa DNR: (877) AIR-IOWA (247-4692).
If the proposal will emit large quantities of air pollutants, contact your Rural Development loan specialist and provide the information from Iowa DNR's Air Quality Section. Specialists will review the information to ascertain the level of environmental review required.

To determine emissions from other facilities in the project area check the EPA website at www.epa.gov/echo/, then:

1. Click on "Air data", in the Facility Characteristics check the "other minor" box.


2. In the Geographic Location boxes click on region 7, State IOWA, and fill in county name, and search. Print out page for file.

Air permits can be viewed at: http://www.iowadnr.gov/air/prof/const/const.html

Approved Coastal Zone Management Area
Iowa does not have any coastal zone management areas. http://coast.noaa.gov/czm/mystate/

Coastal Barrier included in Coastal Barrier Resources System Natural Landmark
Iowa does not have any coastal barrier areas. http://www.fws.gov/cbra/Maps/index.html#LocatorMaps.


Natural Landmark
The National Park Service web site can be found at: www.nps.gov. Under “Find a Park,” click on Iowa to locate national monuments, national historic sites, and historic trails.

Place printout from the website in the file.


Prime Forest Lands
There are no national prime forest lands in Iowa. http://www.fs.fed.us/maps/forest-maps.shtml

For State Forests: Check the DNR website at http://www.iowadnr.gov/Destinations/StateForests.aspx.

Place a printout from the website in the file.

Prime Rangeland
Iowa does not have any prime range land areas. http://www.fs.fed.us/maps/forest-maps.shtml.


Sole Source Aquifer Recharge Area
Iowa does not have any designated sole source aquifers as referenced at the EPA website www.epa.gov/safewater/sourcewater/pubs/qrg_ssamap_reg7.pdf


Wild or Scenic Rivers
Iowa does not have any Wild and Scenic River as defined under the Wild and Scenic Rivers Act of 1968 (16 U.S.C. 1271) as referenced at the National Park Service website www.rivers.gov.

The State of Iowa and the Nationwide Rivers Inventory have designated several areas as protected waterways. View the list at http://www.nps.gov/ncrc/programs/rtca/nri/states/ia.html.

 

Wilderness (designated or proposed under the Wilderness Act)

Iowa has no national wilderness areas.

You may access information national wilderness areas and related state areas at the following sites:

WILDERNESS AREA: www.wilderness.net

The Forest Service, Bureau of Land Management, Fish & Wildlife Service, and National Park Service are charged with stewardship of Wilderness Area lands while providing for appropriate human use and enjoyment. To find out more about these special places, see the site above, which is jointly managed by the University of Montana and the four federal agencies that manage wilderness areas. This is an interactive site where you may type in an address to determine if there is a wilderness area within the area of a proposed project.

• In the left column select “Maps, Data and Images” / select Maps / Under “Online Maps” in the first paragraph, select “GIS Maps” / top header of the website, Choose one of two options for your search.
• Zoom by Typing or Select a Wilderness.
• Find a Place / City / Road.
• Select “Go” which takes you to the area of interest – Along the bottom of the page is the color codes for “Wilderness Managed By ……………”
• Gear symbol in the top right hand corner allows you to save and / or print the map as a source document for the environmental report.

STATE WILDLIFE MANAGEMENT AREA: http://www.iowadnr.com/wildlife/wmamaps/index.html
• Click on the appropriate county on the left-hand side of the screen.

STATE PRESERVE: http://www.iowadnr.gov/Destinations/StatePreserves.aspx


STATE PARK OR RECREATION AREA: http://www.iowadnr.gov/Destinations/StateParksRecAreas.aspx

National Environmental Requirements:

Rural Development environmental requirements can be found here: RD 1970 Environmental Policies and Procedures. Benefits of the 1970 environmental regulations are described here: 7 CFR 1970 Benefits.

There are no other additional requirements at the national level. If there are additional state-specific requirements they will be listed above.

There are currently no events scheduled.

Kate Sand
Community Programs Director in Iowa
ph: 515-284-4459
Kate.Sand@usda.gov

Area Office Contacts
 
Area 1 - Iowa Falls Area Office
 Randy Hildreth, Area Director
 840 Brooks Road
 Iowa Falls, IA 50126
 Phone: 641-648-5181 Ext. 4 Fax: 866-255-6573
 
Counties Served: Butler, Cerro Gordo, Floyd, Franklin, Grundy, Hardin, Marshall, Mitchell, Tama and Worth
 
Area 2 - Waverly Area Office
 Randy Hildreth, Area Director
 1510 3rd Street, SW
 Waverly, IA 50677
 Phone: 319-352-1715 Ext. 4 Fax: 866-255-6573
 
Counties Served: Allamakee, Black Hawk, Bremer, Buchanan, Chickasaw, Clayton, Delaware, Fayette, Howard and Winneshiek

Area 3 - Tipton Area Office
 Randy Campbell, Area Director
 127 West South Street
 Tipton, IA 52772
 Phone: 563-886-6006 Ext. 4 Fax: 866-255-6573
 
Counties Served: Benton, Cedar, Clinton, Dubuque, Iowa, Jackson, Johnson, Jones, Linn and Scott
 
Area 4 - Mt. Pleasant Area Office
 Randy Campbell, Area Director
 709 S. Iris Street, Suite 103
 Mount Pleasant, IA 52641
 Phone: 319-986-5800 Ext. 4 Fax:  855-251-2237
 
Counties Served: Des Moines, Henry, Jefferson, Keokuk, Lee, Louisa, Muscatine, Van Buren and Washington
 
Area 5 - Albia Area Office
 Randy Campbell, Area Director
 1709 South "B" Street
 Albia, IA 52531
 Phone: 641-932-3031 Ext. 4 Fax: 855-251-2237
 
Counties Served: Appanoose, Davis, Jasper, Lucas, Mahaska, Marion, Monroe, Poweshiek, Wapello and Wayne
 
Area 6 - Indianola Area Office
 Randy Campbell, Area Director
 909 East 2nd Aveune, Suite C
 Indianola, IA 50125
 Phone: 515-961-5365 Ext. 4 Fax: 855-251-2238
 
Counties Served: Adair, Clarke, Dallas, Decatur, Guthrie, Madison, Polk, Ringgold, Union and Warren

Area 7 - Atlantic Area Office
 Randy Campbell, Area Director
 511 West 7th Street
 Atlantic, IA 50022
 Phone: 712-243-2107 Ext. 4 Fax: 855-251-2238
 
Counties Served: Adams, Audubon, Cass, Fremont, Harrison, Mills, Montgomery, Page, Pottawattamie, Shelby and Taylor

Area 8 - Le Mars Area Office
 Randy Hildreth, Area Director
 1100 12th Street SW, Suite C
 Le Mars, IA 51031
 Phone: 712-546-5149 Ext. 4 Fax: 855-251-2245
 
Counties Served: Cherokee, Crawford, Ida, Lyon, Monona, O'Brien, Osceola, Plymouth, Sioux and Woodbury

Area 9 - Storm Lake Area Office
 Randy Hildreth, Area Director
 1619 North Lake Avenue
 Storm Lake, IA 50588
 Phone: 712-732-1851 Ext. 4 Fax: 855-251-2245
 
Counties Served: Buena Vista, Calhoun, Carroll, Clay, Dickinson, Emmet, Greene, Palo Alto, Pocahontas and Sac

Area 10 - Humboldt Area Office
 Randy Hildreth, Area Director
 1301 6th Avenue North, Suite 1
 Humboldt, IA 50548
 Phone: 515-332-4411 Ext. 4 Fax: 855-251-2245
 
Counties Served: Boone, Hamilton, Hancock, Humboldt, Kossuth, Story, Webster, Winnebago and Wright