Drive Clean Rural VA: USDA Community Facilities Direct Loan and Grant Program

May 3, 2022

As part of the Drive Clean Rural USA project, Virginia Clean Cities can provide free technical assistance, access to demonstration vehicles, help with the promotion of regional jobs and business growth, and promotion of fleet leadership to participating rural fleets. Through this program, the Virginia Clean Cities Team can help fleets assess alternative fuel options, create a 5-10-year plan that makes financial sense and can be realistically implemented, and connect fleets to funding opportunities and incentives.

When it comes to transitioning a fleet to alternative fuels, the upfront costs of the vehicles and infrastructure can be a barrier, especially for rural and small communities that do not have large annual budgets. The lower prices of alternative fuels and their reduced maintenance costs make the total cost of ownership for alternative fuel vehicles lower than their petroleum-powered counterparts. However, these cost savings do not kick in for fleets until they have been operating the vehicles. Grants or low-interest loans, such as those offered by the USDA Community Facilities Direct Loan and Grant Program can be a great way to reduce the upfront costs that fleets will bare as they wait for the cost savings for the alternative fuels to begin accumulating.

On April 19th, 2021 Virginia Clean Cities was joined by RD Virginia State Director, Perry Hickman, and Community Programs Specialist, Barabara Hodges, of USDA Rural Development to discuss the USDA Community Facilities Direct Loan and Grant Program. This program provides affordable funding to develop essential community facilities in rural areas and can be a great way for rural fleets to transition to alternative fuels!

Public bodies, community-based non-profit corporations, and federally-recognized tribes in rural areas including cities, villages, townships and towns including Federally Recognized Tribal Lands with no more than 20,000 residents according to the latest U.S. Census Data are eligible for this program.

For more information on this program, take a look at the program fact sheet, view the recorded webinar below, review the presentation slides, take a look at the Q&A from the session, and reach out to your local rural development office (contacts listed below).


Q- What is the general timeline that a community might expect to receive funding?

A- It will depend on when the community reaches out to their local USDA Rural Development office. Their office’s fiscal year begins on October 1st, and if at that time there is no budget in place they will be operating on a continuing resolution. When their office has been allocated funding for the year they are better able to estimate the timelines for funding. They also need to consider priority areas for funding, such as areas with lower incomes and smaller populations. Projects only requesting loans can often be funded fairly quickly. It will also depend on the type of project, construction projects will require more time and planning than the equipment project due to environmental review processes required for construction projects.

Q- In the presentation, it was mentioned that the grants are typically in high demand, is there a certain time of year that you see that the grants have already been assigned for communities to know when they should be planning to try to get their applications in?

A- Our fiscal year ends on September 30th and the remaining Community Facility Direct Loan and Grant Program funds that have not been used by state area USDA offices are pooled by the National office in early August. Applications are accepted year-round, but funding can run low especially when we reach the June or July timeframe.

Q- Is the program rolling? If an application is submitted for funding when funding is low would they be able to apply the next year with the same project?

A- Yes, this is a rolling application program. If an applicant applies at a time when funding has already been allocated, the program will keep the applicant’s application active for the next funding cycle.

Q- Are school fleets eligible for funding say for electric school buses?

A- Since public school districts are considered public bodies, they would be an eligible applicant as long as the school is serving those rural communities defined in the program guidance.

Q- Can this funding be combined or supplemented by other federal funding programs?

A- Leveraging funds with other federal, state, or local programs is encouraged! The more funds you get to support a project the further this program can go to support rural communities.

Q- For programs such as the EPA’s upcoming Clean School Bus Program that will initially open as a rebate, would it be possible for an eligible rural school district to use the loan portion of this program to purchase an electric bus and then use the rebate when it comes in from the EPA to pay off the loan?

A- Yes, one of the benefits of this loan and grant program is that there are no pre-payment penalties! So, say for instance a public body finances with this program and then comes into a large windfall of funds through some source, such as a rebate program, they can use it to pay off their outstanding balance on their RD loan.

Q- You mentioned that the cost of charging stations could be covered, could this also cover installation costs like trenching and expansion of electrical capacity?

A- If an application for this program goes beyond equipment cost to something that would involve construction and the disturbance of the soil the project becomes a more complex process as it will invoice more complex environmental requirements. This would need to be addressed on a case-by-case basis. When you get into projects that have environmental and feasibility study requirements, those requirements can extend the project timeline and be costs to consider early in the planning process. It is best to contact the office that serves your county as early as possible in your planning process.

Rural Development- Community Facilities Local Contacts

Area 1- Lebanon Virginia Sub-Office

Robert Hilt, Community Programs Area Specialist Lebanon, Virginia (276) 415-3522   USDA Service Center-Lebanon 140 Highland Drive, Suite 5 Lebanon, VA 24266-4632 Jason Harter, Community Programs Area Specialist Lebanon, Virginia (276) 415-3521   USDA Service Center-Lebanon 140 Highland Drive, Suite 5 Lebanon, VA 24266-4632
  Craig Barbrow, Area Director Wytheville, Virginia (276) 484-9384   USDA Service Center-Wytheville 100 USDA Drive  Wytheville, VA 24381-8366

Area 2- Lynchburg Area Office

Cindy Bomar, Community Programs Area Specialist Lynchburg, Virginia (434) 439-3589   USDA Service Center-Lynchburg  20311-A Timberlake Road Lynchburg, VA 24502 David Worley, Area Director Lynchburg, Virginia (804) 382-4527   USDA Service Center-Lynchburg  20311-A Timberlake Road Lynchburg, VA 24502

Area 3- Harrisonburg Area Office or the Culpeper Sub-Office

Cindy Hines, Community Programs Area Specialist Harrisonburg, Virginia (540) 534-3060   USDA Service Center-Harrisonburg 1934 Deyerle Ave, Suite D Harrisonburg, VA 22801 Daniel Wanamaker, Community Programs Area Specialist Culpeper, Virginia (540) 317-7734   USDA Service Center-Culpeper 351 Lakeside Drive Culpeper, VA 22701  
Steven Davis, Area Director Harrisonburg, Virginia (540) 534-3064   USDA Service Center-Harrisonburg 1934 Deyerle Ave, Suite D  Harrisonburg, VA 22801

Area 4- Courtland Area Office or the Richmond Sub-Office

Peggy Jordan, Community Programs Area Specialist Courtland, Virginia (757) 346-3158   USDA Service Center-Courtland 22329 Main Street Courtland, VA 23837   Tara Delaney, Community Programs Area Specialist Richmond, Virginia (804) 287-1599   USDA Richmond State Office 1606 Santa Rosa Road, Suite 238 Richmond, VA 23229
Myron Wooden, Area Director Courtland, Virginia (757) 346-3162   USDA Service Center-Courtland 22329 Main Street Courtland, VA 23837