The 3rd Annual Conference on Community Development & Financing Kanu Me Ka Laulima Kakou March 23 – 24, 2015 Windward Community College By Timothy W. O’Connell Assistant to the State Director USDA/Rural Development

Rural Development Mission “Improve the quality of life and increasing economic opportunities in rural communities”

REGION OF RESPONSIBILITY State of Hawaii Guam Commonwealth of the Northern Mariana Islands American Samoa Federated States of Micronesia Republic of the Marshall Islands Republic of Palau

RURAL DEVELOPMENT PROGRAMS Over 40 Grant, Direct and Guaranteed Loan and Technical Assistance Programs Providing Access to Capital and Credit for Rural Communities  Housing Programs – single & multi- family housing  Community Programs – community facilities & infrastructure  Business Programs – business & energy development

Housing Programs Rural Development’s housing programs provide access to safe, decent, and sanitary housing to rural low income Hawaii residents. Through its single and multi-family housing programs, Rural Development supports communities by providing rental assistance, and loans or grants for repairing, buying, or building homes.

Housing Programs Single-Family Loan Programs Offered: Section 502 Guaranteed Homeownership Loans Section 502 Direct Homeownership Loans Section 504 Direct Repair Loans Mutual Self-Help Housing Homeownership Loans Single-Family Grant Programs Offered: Section 504 Grant Repair Program Mutual Self-Help Housing Technical Assistance Grants

Community Programs Community facilities programs: Community Facility Loans and Grants are provided to assist essential community facilities in rural areas. Through this program, Rural Development is striving to ensure that such facilities are readily available to all rural Americans.

Community Facilities Loan/Grant  Police or Fire Stations and Equipment.  Schools  Hospitals and Clinics  Rescue Vehicles  Ambulatory Care Centers  Libraries  Community Centers  Assisted Living  Water Treatment Facilities  Telecommunication-Medical or Educational

General Eligibility Criteria  Non-profit corporations  Public entities such as municipalities, county or special purpose district  Propose project must be located in rural areas with a population of 20,000 or less

Community Facility Loans Be unable to obtain funds from other sources Have legal capacity to borrow Be able to pledge security for the loans Be financially sound and able to manage facility Have a financially sound system based on taxes, assessments, system revenues, fees or other sources of income to pay all operating and maintenance expenses and to retire the debt and fund the required reserve

Community Facility Grants Grant funds are very limited Grants can be made to subsidize project development costs Grants can be made on a graduated scale of 15%, 35%, 55% and 75% of project costs Percentage based on income level and population, and financial capacity Generally limited to $50,000 or under.

Eligible Fund Purposes Purchase real estate/buildings; Construction, expansion, or renovations, to essential community facilities; Purchase vehicles and major equipment; Purchase an existing facility when necessary to improve or to prevent a loss of service; Construct buildings, roads, bridges, fences, etc…necessary for the successful operation/protection of the essential community facility.

Eligible Fund Purposes Reasonable necessary fees for: – legal – architectural/engineering – fiscal advisors – environmental – archaeological – mitigation measures – planning – establishing or acquiring rights Up to 1 year initial operating expenses, when necessary, for start-up operations.

HHSC Maui Memorial Medical Center $24.25M USDA CF Direct Loan$12,640,000 USDA Guaranteed Loan 9,001,000 Other Grant Funding 1,351,081 Applicant Funds 1,260,000 Total Project Funding $24,252,081

Explorations Foundation Kailua-Kona CF Direct Loan USDA CF Loan $5,500,000 Applicant 1,500,000 State Funds 1,500,000 Total Project $8,500,000

Seagull Schools, Inc., Oahu $750K Guaranteed and $750K CF Direct Loans

The utility programs consist of programs that allow infrastructure development. Funding activities may include developing water and wastewater systems and solid waste disposal and storm drainage in rural areas and to cities and towns with a population of 10,000 or less. Funds are available to public entities, such as municipalities, counties, special-purpose districts, and Native American Tribes. Funds may also be made available for corporations operated on a not-for-profit basis. Utility Programs

Water & Waste Water Eligibility – Municipalities – Water and/or Sewer Districts – Not for profit organizations To construct, repair, improve or expand a drinking water system To construct, repair, improve a waste water system Rural for water and waste programs is defined as a city, town or service area with a population of less than10,000.

Telecom Programs Broadband Loans (Direct and Guaranteed) – Eligible entities include: Private, Public, and Tribes Community Connect Grants – Nationally Competitive Distance Learning and Telemedicine Loans & Grants – Equipment, hardware, software – Grants Nationally Competitive & Require min 15% match

Business Programs  Business & Industry (B&I) Guaranteed Loan  Intermediary Relending Program (IRP) Loan  Rural Business Enterprise Grant (RBEG)  Rural Business Opportunity Grant (RBOG)  Rural Cooperative Development Grant (RCDG)  Rural Energy for America Loan & Grant Program(REAP)  Rural Economic Development Loan and Grant (REDLG)  Rural Micro-entrepreneur Assistance Program (RMAP)  Small Socially Disadvantaged Producer Grant Program (SSDPG)  Value-Added Producer Grant (VAPG)

Rural Energy for America Program Agricultural producer (individual or entity), Rural small business (in accordance with SBA’s small business size standards Purchase of a renewable energy system or to make energy efficiency improvements Located in a rural area

Grants request can be up to 25% of project costs Renewable Energy: Minimum grant request: $2,500 Maximum grant request: $500,000 Energy Efficiency Minimum grant request: $1,500 Maximum grant request: $250,000 Guaranteed loans… Rural Energy for America Program

Business & Industry (B&I) Guaranteed Loan Program

B&I: Eligible Businesses Retail Wholesale Hotels & Motels Nurseries Timber & Forestry Manufacturing Service Nonprofits Vertically integrated agri-business (e.g. wineries)

Under the B&I program, Rural Development can provide guarantees for loans up to $25 million that a bank makes subject to: – Up to 80 % for loans of $5 million or less – Up to 70% for loans over $5 million to $10 million – Up to 60 % for guaranteed loans over $10 million – Working capital – up to 7 years (no lines of credit) – Equipment – up to 15 years – Real estate – up to 30 years

Keaau, Hawaii $5.0 Million ARRA B&I Guaranteed Loan for Big Island Biodiesel, Inc. Construction of a 2.6 million gallon biodiesel plant, diverting 2.5 million gallons used cooking oil from landfills and creating 12 jobs.

Kailua-Kona, Hawaii $5.5 Million B&I Loan to Cyanotech Corporation Funds financed capital improvements and saved and created a total of 79 jobs.

Rural Business Enterprise Grant (RBEG) Rural Business Opportunity Grant (RBOG) Small Socially Disadvantaged Producer Grant Program (SSDPG) Value-Added Producer Grant (VAPG) Other Business Programs

Rural Business Enterprise Grant (RBEG) To support the development of small and emerging private business enterprises in rural areas. Eligibility--Public bodies and private nonprofit corporations serving rural areas. The end result of the project must finance or develop a small and emerging private business enterprise.

Rural Business Opportunity Grant (RBOG) Promoting economic development that is sustainable over the long term through local effort without subsidies or external support and that leads to improvements quality as well as the quantity of economic activity in the community. Eligibility: Public bodies, nonprofit corporations, and certain types of cooperatives. Purposes: Business plan and feasibility studies; training; technical assistance.

Rural Cooperative Development Grant (RCDG) Fund an entity/center that provides technical assistance to cooperative organizations. Eligible Applicants: Non-profits and/or higher education institutions.

Small Socially Disadvantaged Producer Grant (SSDPG) Provide technical assistance to small, socially disadvantaged agricultural producers. Eligible Applicants—agricultural cooperatives, Cooperative Development Centers or groups of cooperatives. Non-matching.

Value-Added Producer Grant To help agricultural producers enter into value-added activities. Funds are for economic planning or working capital activities related to the processing and/or marketing of value-added agricultural products. NO EQUIPMENT! Eligible Applicants: Independent Producer, Agricultural Producer Group, Farmer or Rancher Cooperative, Majority Controlled Producer-Based Business Maximum Grant Award: –Planning - $75,000 –Working Capital - $200,000 –50% matching requirement

1.Read the directions (also called a NOFA/NOSA/RFP/Regulation). 2.Follow the directions. 3.See #1. 4.If questions—ASK. Don’t assume. 5.Start early. 6.See #1. 7.If you at first don’t succeed, try again. See #1. Grant/Proposal Writing Tips

Will it Fit? What type of grant is the best fit for my project? What does the NOFA/NOSA require? How many years will it take to complete the project? Will the grant allow for that period? Identify special requirements in the program announcement or request for applications. Identify budget information needed and all resources supporting the request.

Am I Ready? Is the project well-defined and concise? How important is the project to the community? What is the evidence? If the request is unsuccessful, what will be the consequence or alternative? Does the project support a Strategic Plan or community initiative? Does my cover letter address the importance of project selection for our community?

Doing Your Homework Have I addressed the review criteria for the grant type? What documentation is needed? Is the project summary persuasive and innovative, is it believable? Do I need a feasibility or market study to support the success of the project? Do I have reasonable estimates of expenses, confirmed from the source? What are the common review problems? What are the common reasons that prevent funding?

Getting it Done How will your organization provide support to the success of the project? Provide all (but only necessary) information and other requirements. Be concise – more is not necessarily better. Be thrifty – if you need a roller skate, don’t ask for a Rolls Royce. Don’t wait until the last minute to submit your application!

Getting it Done Confirm the address and contact person where the application is to be sent. Submit complete applications in one package. Confirm receipt of your complete application. Be patient.

And Finally… Dun & Bradstreet Data Universal Numbering System (DUNS) To get a DUNS number, call or go to System for Award Management (SAM) Register your DUNS number at:

So if you’ve got a viable rural project that needs financial assistance… USDA Rural Development wants to be your cooperative financial partner.