There are no stated matching requirements for this program; however, applicants that include funds from sources other than the funding agency will receive additional points in the application evaluation process, as detailed on pages 249-250 of the FinalRule file. Lenders must also include borrower contributions in the application.
Loan fees will also apply as follows:
- Initial guarantee fee: 1 percent of the guaranteed amount
- Issuance of loan note guarantee prior to construction completion fee: 0.5 percent
Reasonable and customary fees for loan origination are negotiated between the borrower and lender.
Lenders will conduct a credit evaluation using credit documentation procedures and underwriting processes that are consistent with generally accepted prudent lending practices and also consistent with the lender’s own policies, procedures, and lending practices, as detailed on page 3 of the NOFA file.
An unspecified amount of funding is available to support guarantees of loans obtained through private lenders through this program. The total amount of funding available for the program at any given time is available online at www.rd.usda.gov.
The loan guarantee percentage is 80 percent. The maximum loan amount is $50 million.
Interest rates are negotiated between the lender and borrower. Rates may be fixed or variable; however, variable interest rates may not be adjusted more often than quarterly.
The loan term may not exceed 40 years.
Funds may not be used for:
- Portions of a project normally provided by a business or industrial user, such as wastewater pre-treatment
- Taking away customers or service areas of existing U.S. Department of Agriculture (USDA) WWD Program direct or guaranteed loan borrower
- Projects where the borrower acts to circumvent the program regulations, causing the borrower or project being eligible when, previously, the borrower or project was ineligible
- Projects involving the purchase of existing facilities in which the transaction’s purpose is to primarily retire the debt of the seller in order for the seller to continue to use the facility at a lower cost
- Motion pictures and theatrical productions
- Political or lobbying activities
- Guaranteeing loans made by other federal agencies, lines of credit, or lease payments
- Projects that the funding agency determines create, directly or indirectly, a conflict of interest
- Properties to be used for primarily commercial rental when the borrower has no control over tenants and services offered, except for industrial-site infrastructure development
- Projects that utilize technology, equipment, or systems that are not commercially available
Refer to pages 164-166 and 175-176 of the FinalRule file for additional information regarding ineligible costs.