Comprehensive Guide to OneRD Guarantee Loan Initiative

 
OneRD Guarantee Loan Initiative
 
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Rural and Rural Areas:
Any area of a State not in a city
or town with a population of
more than 50,000 people
Urban areas contiguous to
cities and towns with
populations of 50,000 or more
are not eligible
Eligibility can be checked on
our eligibility map:
 
 
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Borrower must meet
one of the following at
the time of closing the
guaranteed loan:
 
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Requirements:
Lender must request to have LNG issued prior to completion; Agency must
concur
If project involves non-proven technologies, Lender cannot request to issue
LNG prior to completion
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Lender must provide evidence that Borrower has entered a fixed-price
construction contact
Lender must provide monthly construction reports to Agency
 
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Loan Retention:
Lender must retain a minimum of 7.5% of total loan amount in
portfolio
Guarantee Fee
One-time guarantee fee of 3% of guaranteed amount
Retention Fee
.5% of the guaranteed amount @ 12/31 of each year
Fees will be established/revised for each fiscal year
 
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Under OneRD, Lenders must be:
Domiciled in a State
Not debarred or suspended by the federal government
Inform Agency if under a consent order from a Federal or State Agency
Maintain written standards of conduct covering conflict of interest
Maintain internal audit and management control systems
Become approved in Agency’s electronic System
Must complete Level 2 E-authentication:
https://www.eauth.usda.gov/home
 
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Non-Regulated Lender serving Tribal Trust Lands (new)
Unregulated by Federal or State statutes and has a specific
mission to make loans available only to tribal trusts
Non-Regulated Lenders
Not subject to regulatory review, examination, or oversight by
Federal or State
Regulated Lenders
Organized by Federal or state statute and are subject to
supervision and credit examination by an Agency
 
 
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Non-Regulated Lending Entity
Any type of entity that does not meet the definition of a
regulated entity
Includes CDFI lenders, who are authorized and must meet
certain criteria of the U.S. Treasury
Not subject to regulatory or internal credit examination
requirements
Once approved by the Agency, can make loans across all four
programs
 
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Borrower must be:
A cooperative, corporation,
partnership, or other legal entity
organized and operated on a profit or
non-profit basis
An Indian Tribe
A public body
An individual
Borrower must engage in or
promote a business which will
provide employment or improve
the economic or environmental
climate in rural communities
 
Borrower who is an individual
must
:
Be a citizen of the US
Reside in the US after being
legally admitted for permanent
resident
Be a resident of the Republic of
Palau, Micronesia, American
Samoa, Guam, the Marshall
Islands, and the Northern Mariana
Islands
Borrower must demonstrate the
project will primarily create new
or save existing jobs for rural
US residents
 
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Purchase, development of land, associated infrastructure,
building upgrades
Business acquisitions, start-ups, expansions to create or
save jobs
Purchase of machinery and equipment
Pollution Control
Education and training facilities
Cooperatives and local food projects
 
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No longer requires tangible balance sheet equity; new
requirement to have sufficient capital or equity to mitigate ongoing
risks of business
Project must be located in a rural area with less than 50,000
people
For utility projects serving both rural and non-rural areas, the Agency will
guarantee only the amount necessary to finance the portion of the project
in an eligible rural area
Projects must be located in rural areas; except for loans to
cooperatives and for local food projects
 
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Maximum Loan Amount: $25M
Up to $40M for rural cooperatives that process value-added
agricultural commodities
Guarantee Fee: 3.0%
Periodic Guarantee Retention Fee: 0.5%
Loan Guarantee Percentage: 80%
Fee for LNG Prior to Construction: 0.5%
 
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Jennifer Sharrow – Business and Community Programs, Loan
Specialist
  
Jennifer.Sharrow@usda.gov
  
(413) 923-3243
 
Dave Brown – Business and Community Programs, Loan
Specialist
  
David.Brown3@usda.gov
  
(860) 902-5377
 
 
 
 
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The OneRD Guarantee Loan Initiative offers funding opportunities for eligible rural and rural areas, with specific criteria and requirements for borrowers, lenders, and loan issuance. The program includes options for Loan Note Guarantee (LNG) issued prior to project completion, loan retention and fees, lender eligibility, and types of lending entities involved. Eligibility details and process are available online, with a focus on supporting rural development.


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  1. OneRD Guarantee Loan Initiative

  2. Eligible Areas Rural and Rural Areas: Any area of a State not in a city or town with a population of more than 50,000 people Urban areas contiguous to cities and towns with populations of 50,000 or more are not eligible Eligibility can be checked on our eligibility map: http://eligibility.sc.egov.usda.gov/eligibility/welcomeAction.do

  3. Balance Sheet Equity (B&I) Borrower must meet one of the following at the time of closing the guaranteed loan:

  4. Loan Note Guarantee (LNG) Issued Prior to Project Completion Now available across all programs Requirements: Lender must request to have LNG issued prior to completion; Agency must concur If project involves non-proven technologies, Lender cannot request to issue LNG prior to completion Lender pays 0.5% fee upon requesting LNG Lender must provide evidence that Borrower has entered a fixed-price construction contact Lender must provide monthly construction reports to Agency

  5. Loan Retention/Fees Loan Retention: Lender must retain a minimum of 7.5% of total loan amount in portfolio Guarantee Fee One-time guarantee fee of 3% of guaranteed amount Retention Fee .5% of the guaranteed amount @ 12/31 of each year Fees will be established/revised for each fiscal year

  6. Lender Eligibility Under OneRD, Lenders must be: Domiciled in a State Not debarred or suspended by the federal government Inform Agency if under a consent order from a Federal or State Agency Maintain written standards of conduct covering conflict of interest Maintain internal audit and management control systems Become approved in Agency s electronic System Must complete Level 2 E-authentication: https://www.eauth.usda.gov/home

  7. Types of Lending Entities Non-Regulated Lender serving Tribal Trust Lands (new) Unregulated by Federal or State statutes and has a specific mission to make loans available only to tribal trusts Non-Regulated Lenders Not subject to regulatory review, examination, or oversight by Federal or State Regulated Lenders Organized by Federal or state statute and are subject to supervision and credit examination by an Agency

  8. Non-Regulated Lending Entity Non-Regulated Lending Entity Any type of entity that does not meet the definition of a regulated entity Includes CDFI lenders, who are authorized and must meet certain criteria of the U.S. Treasury Not subject to regulatory or internal credit examination requirements Once approved by the Agency, can make loans across all four programs

  9. Business & Industry Loan Guarantee Program

  10. Business and Industry (B&I): Eligible Borrowers Borrower who is an individual must: Be a citizen of the US Reside in the US after being legally admitted for permanent resident Be a resident of the Republic of Palau, Micronesia, American Samoa, Guam, the Marshall Islands, and the Northern Mariana Islands Borrower must demonstrate the project will primarily create new or save existing jobs for rural US residents Borrower must be: A cooperative, corporation, partnership, or other legal entity organized and operated on a profit or non-profit basis An Indian Tribe A public body An individual Borrower must engage in or promote a business which will provide employment or improve the economic or environmental climate in rural communities

  11. Business and Industry: Eligible Projects Purchase, development of land, associated infrastructure, building upgrades Business acquisitions, start-ups, expansions to create or save jobs Purchase of machinery and equipment Pollution Control Education and training facilities Cooperatives and local food projects

  12. Business and Industry: Loan Highlights No longer requires tangible balance sheet equity; new requirement to have sufficient capital or equity to mitigate ongoing risks of business Project must be located in a rural area with less than 50,000 people For utility projects serving both rural and non-rural areas, the Agency will guarantee only the amount necessary to finance the portion of the project in an eligible rural area Projects must be located in rural areas; except for loans to cooperatives and for local food projects

  13. Business and Industry: Loan Highlights (cont.) Maximum Loan Amount: $25M Up to $40M for rural cooperatives that process value-added agricultural commodities Guarantee Fee: 3.0% Periodic Guarantee Retention Fee: 0.5% Loan Guarantee Percentage: 80% Fee for LNG Prior to Construction: 0.5%

  14. USDA Local Contacts Jennifer Sharrow Business and Community Programs, Loan Specialist Jennifer.Sharrow@usda.gov (413) 923-3243 Dave Brown Business and Community Programs, Loan Specialist David.Brown3@usda.gov (860) 902-5377

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