Rural Economic Development
Loan and Grant Program

Zero Interest Loans To Business And Industry Through Your Local EMC

PROGRAM DESCRIPTION: Purpose is to develop projects that will result in a sustainable increase in economic productivity, job creation, and incomes in rural areas. Projects may include business start-ups and expansion, community development incubator projects, medical and training projects, and feasibility studies. Ineligible purposes are those that directly benefit the borrower, conflicts of interest, and costs incurred prior to the application.

ELIGIBILITY REQUIREMENTS: Applicants are located in the service area of an Electric Membership Cooperative (EMC) that is a current or pre-paid member and RUS telephone borrowers. The majority of the beneficiaries must be in a rural area of fewer than 2,500 in population.

FUND AVAILABILITY AND MAXIMUM AMOUNTS: Funding is either a zero-interest loan or a grant to the borrower, which in turn is relent as a zero interest loan. The maximum amount available varies each year. In fiscal year 2002- 2003, it is $450,000 for the pass-through loan (Business and Industry Loans) and $200,000 for the grant. The minimum is $10,000.

TERMS: For a zero-interest loan, the borrower will sign a promissory note with a term not to exceed 10 years. Principal may be deferred up to two years. All loans will be secured. The borrower must have a specific recipient at the time of application. All loans to this recipient will be at zero interest repayment by the recipient and will ordinarily equal the term of the loan to the borrower.
Grant funds must be matched 20% up-front by the borrower. These accounts will be used as zero interest (initially) revolving loans for: community development for public bodies and non-profits; business incubators owned by non-profits; facilities and equipment for education, training or medical care of rural residents. Funds from other sources must at least equal 20% of the loan or grant amount.

For your grant application preparation and further questions please contact:

Lumbee River Electric Corporation
PO Box 830
Red Springs, NC 28377
(910) 843-4131 or (800) 683-5571

Timothy Locklear
Manager of Key Accounts & Business Development
(910) 843-7906
tim.locklear@lumbeeriver.com