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Community Facilities Direct Loan Program 

In providing support, education, and guidance to enable rural communities to access the Community Facilities USDA grants, which has been a mainstay of rural development for many years, Flaney Capital stands shoulder to shoulder with every community. The Community Facilities Loan Program provides a source of inexpensive funding to assist with the growth of a community in an orderly way. The loan program is designed to facilitate essential community facilities that enhance the well-being of the community. It is the cheapest type of funding in our community.

by | Nov 17, 2023


Eligibility Criteria

Modern fire truck and equipment in front of rural fire station

Communities within rural regions (which can include cities, villages, townships, and even Federally Recognized Tribal Lands) with fewer than 20,000 residents based on population data from the most recent U.S. census are eligible to join.

Essential facilities that qualify for the loan include:

  • Public facilities

  • Healthcare facilities

  • Educational services

  • Local food systems

  • Utility services

  • Community support services

  • Services transportation facilities

  • Recycling and transfer centers

Utilization of Funds

The options for the use of these funds is to develop essential community facilities such as purchasing, constructing, or improving community facilities; purchasing equipment; and the advancement of funding costs and other expenditures related to the project.

The essential Community Facility Direct Loan Program is an excellent way for communities to expand and improve their infrastructure and potentially achieve orderly development in all sectors.

USDA Community Facilities Benefits

Community Club House

The US Department of Agriculture’s Community Facilities Program has served as a conduit for essential support to rural America. Each year, the program distributes tens of millions of dollars in grant assistance and low-interest loans for qualifying facilities. 

These facilities represent the backbone of community infrastructure and life, functioning as vital hubs for rural citizens. Let’s take a closer look at the types of facilities that qualify for support under the Community Facilities Program and examine how these facilities benefit rural America.

Nurturing community health

Hospitals, clinics and nursing homes are all essential health centers that help support individual and community health. These institutions not only provide much-needed medical services, but they also offer health education, programs, and other wellness initiatives that allow rural residents to receive quality medical services and access education and resources that keep themselves and their communities healthy and resilient.

Some recipient community facilities of USDA Community Facilities Program funding include hospitals, clinics and nursing homes.

Empowering economic development

Investments in public infrastructure, including community facilities in rural and airport hangars, are vital for stimulating economic growth in rural areas. Enhanced transportation infrastructure facilitates commerce, tourism, rural utilities service financing, and trade, driving economic activity and creating job opportunities for local residents.

By supporting the development of public facilities, the USDA Community Facilities Program lays the groundwork for sustainable economic development and prosperity in rural communities.

Cultivating cultural enrichment

  • Museums, libraries, community halls, and other cultural entities in the countryside provide residents with opportunities for educational and social development. These spaces provides educational programs, exhibits and entertainment that improve the lives of residents and build a sense of unity in the community. 

    The goal of the USDA Community Facilities Program through this investment in cultural infrastructure is to provoke creativity, learning as well as engagement in civil issues which in turn improves rural lives quality.

    Strengthening emergency response

    Ranging from fire departments to police stations the Municipality’s public safety services are the very core of maintaining law and order and responding to emergencies. Adequate financing of public safety infrastructure and equipment enables the provision of emergency services and ensures well-managed disasters safeguarding rural residents’ lives and property. 

    With its community funding efforts, the Community Facilities Program of the USDA is the catalyst that reinforces community defense and public safety in the rural areas of the country.

    Fostering food security and sustainable agriculture

Communtiy Facility

Fostering food security and sustainable agriculture

The local food system, including the community gardens and food banks ensure food security in rural areas. These interventions motivate farmers locally, prevent food waste, and make nutritious food available to vulnerable communities. 

The Community Facilities Program of the USDA invests in local food infrastructure and fosters food sovereignty, environmental friendliness, and community self-sufficiency which results in a sustainable rural environment.

Community Facility Grants: Choosing the Most Effective Options

School Facility

The USDA Community Facilities program provides various financing options, which will suit unique scenarios. Among these is the option of low-cost direct loans, which provide excellent and affordable financing for essential services such as schools, libraries, healthcare centers, and police stations. 

These loans provide market-competitive interest rates and have flexible terms of payment, which make them preferable for the implementation of various community development projects.

Choosing a loan is advantageous when:

  • Your project is outlined, with a fixed budget and schedule.

  • You can do it in stages without jeopardizing the financial health of your community.

  • You need to finance a capital-intensive project that will create long-term benefits for your community.

On the flip side, USDA grants are awarded for these projects free of charge and to assist in community development including infrastructure development, economic development, and delivery of essential services. 

Unlike loans, grants do not need to be repaid, and this eliminates the financial burden on community resources. On the other hand, they are a great source of diversification and have a huge positive impact on the socio-economic development of rural areas.

Choosing a grant is advantageous when:

  • Your project addresses pressing community needs that require immediate funding.

  • You lack the financial resources or revenue-generating capacity to repay a loan.

  • You’re working on a project that meets the priorities and criteria of USDA grant programs – activities that promote economic development, quality of life, or provide services to underserved populations.

Lastly, you have the option of combination financing.  This is the use of both loans and grants. The strategy combines loans (borrowing at lower rates) and grants (gifts) to access a wider range of funds, thereby improving project financing with lower costs to borrowing and adopting both capital investment and operating expenses. Choosing a combination of loans and grants is advantageous when:

  • Your investment must be made upfront but yields revenue down the road.

  • You want to minimize borrowing costs and reduce the financial burden on your community.

Your program meets the objectives and eligibility criteria of both lending and grant programs, allowing you to seek funding in both funding streams.

Terms and Requirements

Community of Houses

First of all, let’s discuss Direct Loan. The program provides terms customized for a sustainable project and a long-term success. Because your repayment terms coincide with your facility’s useful life, you know that your financial liabilities will match your income for the same period of time.

Additionally, interest rates are set based on community demographics, which means that you will enjoy stability and predictability in interest rates throughout the loan period. The best part is there are no fees charged for early payments, allowing you to keep your finances in order and a guaranteed loan anytime you need.

On the other hand the grant provides non-reimbursable funds to the eligible borrowers who are qualified for the financing. The size of your grant awards is heavily weighted by the graduated scale, with communities that have a median household income of below the national level receiving a higher rate of the fall grant funds. 

This way, you can receive the assistance you need to successfully implement your project irrespective of community size even if it is a low-income area.

It, however, is vital to mention that there are particular benchmarks for both loans and grants. The providers of loans need to have the right to give out credits, put security on them, and collect the payments. In addition, the initiatives must support child care centers and must illustrate strong community backing.

Flaney Capital’s team is here to support you throughout the process of application and makes sure you fulfill all the requirements.

Through the utilization of the USDA Community Facilities program, you can unlock the power of your community and bring in the impact of the future for the years ahead. You can learn more and even get started by contacting us today. We are in this together!

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Here are some answers to Frequently Asked Questions.

What is the interest rate?

The United States Department of Agriculture Community Facilities program establishes interest rates to be negotiated between the borrowers and the lenders. Our contribution at Flaney Capital is to link you with lenders who provide a discount rate specifically based on your project. Fixed or variable rates, our network can help you find the best terms and rates favorable to you.

What are the applicable fees?

Fees may differ among different lenders and are specifically tailored to each project. Nonetheless, we make the process transparent. As we educate borrowers on fees, we lead everyone through the USDA financing process with full information about possible costs.

At Flaney Capital, our mission is educating the local community and providing members with access to competitive financial opportunities. We help you leverage a network of reputable lenders whose interest rates and fee structures are highly competitive, ensuring a favorable outcome for your projects.

Contact us at 1-888-822-0844.

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