To assure that people in eligible rural areas have
access to electric services comparable in reliability and quality to the rest
of the Nation.
TYPES OF ASSISTANCE:
Direct Loans. Place Cursor Here for Definition
USES AND USE RESTRICTIONS:
Long-term, direct loans and loan guarantees to qualified organizations for the
purpose of supplying or improving central station electric services on a
continuing basis in rural areas.
ELIGIBILITY REQUIREMENTS:
Applicant Eligibility: Rural electric cooperatives,
public utility districts, power companies, municipalities, and other qualified
power suppliers including those located in the U.S. Territories.
Beneficiary Eligibility: Persons in rural areas
not receiving central station electric service, and those currently served
through RUS financing. Rural areas are defined in the Rural Electrification
Act as any area of the United States not included within the boundaries of any
urban area as defined by the Bureau of the Census. Such term shall be deemed
to include both the farm and non-farm populations.
Credentials/Documentation: None. This program is
excluded from coverage under OMB Circular No. A-87, "Cost Principles for
State, Local and Indian Tribal Governments."
APPLICATION AND AWARD PROCESS:
Pre-application Coordination: Applicants must supply
environmental impact information to determine whether an environmental impact
assessment or an environmental impact statement will be required. This program
is excluded from coverage under E.O. 12372 and OMB Circular No. A-102,
"Grants and Cooperative Agreements with State and Local
Governments."
Application Procedure: Applications for direct
loan and loan guarantees are made by resolution of the board of directors of
the borrowing organization. Information on submitting applications is
contained in 7 CFR Part 1710 and 1714. This program is excluded from coverage
under OMB Circular No. A-110, "Uniform Administrative Requirements for
Grants and Agreements with Institutes of Higher Education, Hospitals and other
Nonprofit Organizations."
Award Procedure: Depending on the amount of the
application, the RUS Administrator, Assistant Administrator, or appropriate
Regional Director makes the final decision on approval of the loan upon a
finding that it is economically feasible and serves the purposes of the Rural
Electrification Act. Borrowers and Members of Congress are notified of the
approval of a loan or loan guarantee directly, and the public is notified
through normal media communications.
Deadlines: None.
Range of Approval/Disapproval Time: Direct loans
are generally approved in 12 to 18 months as funding becomes available. Loan
guarantees are approved in about 3 months.
Appeals: Not applicable.
Renewals: Not applicable.
ASSISTANCE CONSIDERATIONS:
Formula and Matching Requirements: Under certain
conditions, obtaining an RUS insured electric loan will require obtaining a
concurrent loan (of 10, 20, or 30 percent of the total amount required) from a
supplemental financing source. The factors used for determining the amount of
concurrent financing required are set forth in 7 CFR 1710.110.
Length and Time Phasing of Assistance: Direct
loans are generally made for a period up to 35 years, that approximates the
expected useful life of the facilities financed. Provision is normally made
for advances to be completed within 4 years, but this period is subject to
extension if required. Advances of funds are made as required by the borrower.
The terms and conditions of loan guarantees are negotiated between the
borrower and the non-RUS lender, subject to RUS approval.
POST ASSISTANCE REQUIREMENTS:
Reports: RUS borrowers must submit to the Rural
Utilities Service regularly scheduled operating reports showing financial
condition and operating progress.
Audits: In accordance with the provisions of OMB
Circular No. A- 133 (Revised, June 24, 1997), "Audits of States, Local
Governments, and Nonprofit Organizations," nonfederal entities that
expend financial assistance of $300,000 or more in Federal awards will have a
single or a program-specific audit conducted for that year. All other RUS
borrowers have their books audited annually by a Certified Public Accountant.
Information on audits of RUS borrowers is contained in 7 CFR Part 1773.
Records: RUS borrowers keep the records
prescribed for utility companies by the RUS uniform system of accounts, and by
sound business practices.
Obligations: (Direct Loans) FY 01 $416,536,557;
FY 02 est $916,500,000; and FY 03 est $915,486,465. (Guaranteed FFB) FY 01
$1,700,000,000; FY 02 est $1,700,000,000; and FY 03 est $1,700,000,0000.
Range and Average of Financial Assistance: Fiscal
year 2001: Direct Loans - $443,000 to $103,000,000; $8,167,383 average.
Direct, FFB guarantees - $698,000 to $269,940,000; $17,000,000 average.
From October 1999 to September 30, 2001, 51 direct loans and 100 loan
guarantees were made.
REGULATIONS, GUIDELINES, AND LITERATURE:
7 CFR XVII. RUS publishes and issues upon request bulletins bearing on the
financing, construction, operation, and maintenance of rural electric systems.
Also available are annual statistical summaries; and the Rural Electrification
Act of 1936, as amended.
INFORMATION CONTACTS:
Regional or Local Office: None.
Headquarters Office: Administrator, Rural
Utilities Service, Department of Agriculture, Washington, DC 20250-1500.
Telephone: (202) 720-9540. Use the same number for FTS.
