Financing Resources

Rural Business Development Grants

What does this program do?

This program is a competitive grant designed to support targeted technical assistance, training and other activities leading to the development or expansion of small and emerging private businesses in rural areas which will employ 50 or fewer new employees and has less than $1 million in gross revenue. Programmatic activities are separated into enterprise or opportunity type grant activities.

Who may apply for this program?

Rural public entities including, but not limited to:

  • Towns
  • Communities
  • State agencies
  • Authorities
  • Nonprofit corporations
  • Institutions of higher education
  • Federally-recognized Tribes
  • Rural cooperatives (If organized as a private nonprofit corporation)

What is an eligible area?

RBDG funds must be used for projects benefitting rural areas or towns outside the urbanized periphery of any city with a population of 50,000 or more. Check eligible areas.

How much funding is available?

There is no maximum grant amount; however, smaller requests are given higher priority. Generally, grants range from $10,000 to $500,000. There is no cost sharing requirement. Opportunity grants are limited to up to 10 percent of the total RBDG annual funding.

How may funds be used?

Enterprise grants must be used on projects to benefit small and emerging businesses in rural areas as specified in the grant application. Uses may include:

  • Training and technical assistance, such as project planning, business counseling/training, market research, feasibility studies, professional/technical reports, or product/service improvements
  • Acquisition or development of land, easements, or rights of way; construction, conversion, renovation of buildings; plants, machinery, equipment, access for streets and roads; parking areas and utilities
  • Pollution control and abatement
  • Capitalization of revolving loan funds, including funds that will make loans for start-ups and working capital
  • Distance adult learning for job training and advancement
  • Rural transportation improvement
  • Community economic development
  • Technology-based economic development
  • Feasibility studies and business plans
  • Leadership and entrepreneur training
  • Rural business incubators
  • Long-term business strategic planning

Opportunity grants can be used for:

  • Community economic development
  • Technology-based economic development
  • Feasibility studies and business plans
  • Leadership and entrepreneur training
  • Rural business incubators
  • Long-term business strategic planning

How are applications evaluated?

All applications are evaluated based on:

  • Evidence showing job creation at local businesses;
  • Percent of non-federal funding committed to the project;
  • Economic need in the area to be served;
  • Consistency with local economic development priorities;
  • Experience of the grantee with similar efforts; and

Other factors described in the current Notice of Solicitation of Applications (NOSA), if one is published.

How do we get started?

  • Applications are accepted through USDA Rural Development’s local or State offices once per year. Applicants are advised to view program information specific to your local or State office to learn about local application timelines, concept paper requirements, etc.
  • Grant awardees will need to complete required paperwork and comply with the terms and conditions of the award.  Contact your local or State office for details.

 Who can answer questions?

 What governs this program?

  • Basic Program – 7 CFR Part 4280, Subpart E.  This program is authorized by the Consolidated Farm and Rural Development Act (ConAct)

What governed the predecessor programs of Rural Business Enterprise Grants (RBEG) and Rural Business Opportunity Grants (RBOG), as well as all awards given before FY 2015?

  • RBEG Basic Program - RD Instruction 1942-G
  • RBOG Basic Program - 7 CFR Part 4284
  • This program was authorized by the Consolidated Farm and Rural Development Act (ConAct)

Why does USDA Rural Development do this?

This program provides grants for rural projects that finance and facilitate the development of small and emerging rural businesses, help fund distance learning networks, and help fund employment-related adult education programs. To assist with business development, RBDGs may fund a broad array of activities.

Category: USDA Rural Development, Federal Incentives

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