Rural Business Enterprise Grants (RBEG)

Providing grants for assisting small and emerging rural businesses through nonprofits and public bodies

The purpose of the Rural Business Enterprise Grants (RBEG) program is to finance and facilitate the development of small and emerging private business enterprises in rural areas through grants to public bodies, nonprofits, and federally recognized Indian Tribal groups. This includes starting and operating revolving loan funds, business incubators, and industrial parks.

Grant funds may also be used for the acquisition and development of land and the construction of buildings, plants, equipment, access streets and roads, parking areas, and utility and service extensions; refinancing; fees for professional services; technical assistance and training; startup operating costs and working capital through a loan from a revolving loan fund, providing financial assistance to a third party; production of television programs to provide information to rural residents; and creating, expanding, and operating rural distance learning networks.

Application and Financial Information
Applicants must submit supporting data before making a formal application. After determining the order of funding priorities, the Rural Business – Cooperative Services office will tentatively determine eligibility and request applicants to submit formal applications.

Application forms are available from and may be filed in any state USDA Rural Development office, but applications are usually processed in a district or area office. Grant amounts are based on need and available appropriate funds. The funding level in Fiscal Year 2003 was $51.4 million.

Eligibility, Uses, and Restrictions
The RBEG program is for nonprofits and public bodies to assist small and emerging businesses in rural areas. A rural area is defined as any area other than a city or town that has a population of more than 50,000 and the urbanized area contiguous and adjacent to such a city or town. Public bodies include incorporated towns and villages, boroughs, townships, counties, states, authorities, districts, and Native American Tribes on federal and state reservations, and other federally recognized Indian Tribal groups in rural areas.

RBEG funds cannot be used for agricultural production (through growing, cultivation, and harvesting directly or through horizontally integrated operation), area-wide planning; loans by grantees with unreasonable terms, rates, and charges; development of a proposal that could pull business activity or jobs away from one area to another; development of a proposal that could result in an area with too many goods or materials and not enough demand.

All funded projects are subject to an environmental assessment in accordance with the National Environmental Policy Act. Applicants for grants to establish a revolving loan fund must include details on their experience operating a revolving loan program, proposed projects, and financial ability to operate a revolving fund, and plans for leveraging.

Contact
To receive an application, contact one of the 47 USDA Rural Development State Offices where the project is located.

Amy Cavanaugh
National Program Office
USDA, Rural Business-Cooperative Service (RBS)
Room 6868 South Building, Stop 3225
Washington, DC 20250
Phone: (202) 720-1400; Fax: (202) 720-2213

Internet
www.rurdev.usda.gov/rbs/busp/rbeg.htm

Last Updated January 24, 2005