rural economic development loan and grant program

America’s economy rides on the wheels of small businesses.

The U.S. Small Business Administration says more than half of Americans either own or work for a small business. The contributions of these firms will be honored May 1-7 during National Small Business Week -- #DreamSmallBiz -- and USDA Rural Development is proud to join in the celebration.

As the leading federal agency working exclusively to foster economic opportunity in rural America, Rural Development knows Main Street businesses drive the rural economy. Money earned and spent at a small town “mom-and-pop” store, or a small-scale manufacturer gets re-invested locally.

This post is part of the Science Tuesday feature series on the USDA blog. Check back each week as we showcase stories and news from USDA’s rich science and research portfolio.

Though many of us don’t see farmers every day, we certainly see and benefit from the products of their farms every day. Rural America makes many cameos in urban and suburban life, from the array of foods we eat to the sweaters our Olympic and sports champions wear and the batteries that power our cars. A recent White House blog states that although Rural America provides the vast majority of food and energy benefits for the rest of the country, too many Americans in rural areas are not sharing in the nation’s economic growth. Infrastructure development, technological advancement and school improvement can contribute significantly to rural and community development strategies that could spur economic growth. USDA is committed to spreading the Nation’s prosperity to rural areas, and has a long history of funding programs aimed at promoting rural America.

In late 2011, the President announced a White House Rural Council initiative lead by the US Department of Health and Human Services (HHS) and US Department of Agriculture (USDA) to invest in rural health and link rural doctors and hospitals to financing for health IT. The initiative was designed to address the need for financing to support the adoption of health IT systems in rural communities.  Financing has been cited as one of the top challenges for rural doctors and hospitals serving remote and poor communities.

Between 2012 and 2014, the HHS and USDA led initiative generated approximately $1 Billion in rural health care financing across 13 states. These investments, funded by USDA, included grants and loans to help rural clinics and hospitals transition from paper to electronic health records (EHRs), encourage exchange of health information with health care providers and patients, and offer telehealth services.

What started as a small operation almost 40 years ago has grown into major contributor to the economy in Albert Lea, Minn.

Mrs. Gerry’s Kitchen, Inc., started on Dec. 4, 1973, in a building that occupied 1,100 square feet. Today, Mrs. Gerry’s is adding a 36,500 square-foot addition that will bring its building to over 100,000 square feet and help meet growing customer demand for its real (no flaky stuff here) mashed potatoes and other products.

As construction crews were busy putting the finishing touches on New Vision Co-op’s new grain elevator and feed mill in Magnolia, Minn., last month, USDA Rural Development State Director Colleen Landkamer and other area leaders visited the site to highlight the economic impact of the project.

“This investment by USDA means jobs and economic development opportunities,” Landkamer said.

Late last month, Deputy Under Secretary for Rural Development Doug O’Brien visited Manning, Iowa, and participated in groundbreaking ceremonies for the new Manning Regional Healthcare Center. The new hospital, which will replace a facility that was built in 1927, is receiving a $21 million loan from USDA Rural Development.

“Rural residents must have access to the best available care, and this medical campus will provide decades of service to the residents of this region,” O’Brien said. “President Obama’s plan for rural America has brought about historic investments and resulted in stronger rural communities.”

When construction is completed, Manning Regional Healthcare Center’s new 17-bed critical access hospital will also include a physician clinic and recovery center that will provide substance abuse treatment services for up to16 patients in a partial residential setting.

The City of Murdo, South Dakota, is located at the crossroads of Interstate 90 and Highway 83 in the middle of the State.  A town with a population of 500 in a county with one person per square mile; Murdo has several new businesses and recreational activities that keeps the town thriving.

An all-volunteer Murdo Development Corporation manages a local revolving loan fund started through a USDA Rural Development Rural Business and Enterprise Grant (RBEG).  From creating jobs to helping to retain them at the local golf course to funding improvements to the local grocery store, Murdo Family Foods, the loan fund has assisted in the growth of the community.

Beadle and Spink Enterprise Community (BASEC) just made its 500^th loan and through its revolving loan program has loaned over $16 million dollars to improve the economic and housing climate of part of South Dakota since 1996. BASEC (named after the two counties it serves) has less than a 1 percent default rate and has made loans to all income levels with the majority being low to moderate income applicants.  Some of the borrowers have had excellent credit histories and some not so good.  Executive Director Lori Hintz feels the key to the low default rate besides the fact that great people live in the service area, is that when times get tough, they try to work out a plan that works for them, their cash flow and their situation.