USDA to provide $1 billion in rural business and ag producer loan guarantees

Press release

WASHINGTON —U.S. Secretary of Agriculture Sonny Perdue announced Thursday that USDA is making available up to $1 billion in loan guarantees to help rural businesses meet their working capital needs during the coronavirus pandemic.

Additionally, agricultural producers that are not eligible for USDA Farm Service Agency loans may receive funding under USDA B&I CARES Act Program provisions included in the Coronavirus Aid, Relief, and Economic Security Act.

In addition to expanding eligibility to certain agricultural producers, the changes Perdue announced allow USDA to:

• Provide 90 percent guarantees on B&I CARES Act Program loans;

• Set the application and guarantee fee at two percent of the loan;

• Accept appraisals completed within two years of the loan application date;

• Not require discounting of collateral for working capital loans, and

• Extend the maximum term for working capital loans to 10 years.

B&I CARES Act Program loans must be used as working capital to prevent, prepare for or respond to the effects of the coronavirus pandemic. The loans may be used only to support rural businesses, including agricultural producers, that were in operation Feb. 15.

USDA intends to consider applications in the order they are received. However, the Department may assign priority points to projects if the demand for funds exceeds availability.

USDA announced the expanded B&I CARES Act Program authorities in a notice published in the May 21 Federal Register, available online at https://s3.amazonaws.com/public-inspection.federalregister.gov/2020-11243.pdf .

Program funding expires Sept. 30, 2021.

Eligible applicants may contact their local USDA Rural Development State Office in the state where the project is located.

USDA is developing application guides for lenders and borrowers on the B&I CARES Act Program. The Agency also will host two webinars to provide an overview of program requirements.

To register for the webinar Wednesday, May 27, at 1:30 p.m. Mountain Time, people can visit globalmeet.webcasts.com/starthere.jsp?ei=1322642&tp_key=7a700acddd online.

To register for the webinar Wednesday, June, 3 at noon Mountain Time, people can visit globalmeetwebinar.webcasts.com/starthere.jsp?ei=1324161&tp_key=6067315417.

USDA Rural Development provides loans and grants to help expand economic opportunities and create jobs in rural areas. This assistance supports infrastructure improvements; business development; housing; community facilities such as schools, public safety and health care; and high-speed internet access in rural areas.

For more information, people can visit http://www.rd.usda.gov online.