USDA Rural Development Announces Coastal Enterprises, Inc. will receive $20 Million Loan to Reduce Rural Poverty

Please note that CEI is finalizing program details for the USDA loan award. Please check back for more information or call 207-504-5900. 

Oct. 6, 2016 (Berea, KY) – Agriculture Secretary Tom Vilsack today unveiled an innovative partnership with community development organizations from across the country, providing $401 million of Community Facilities program funds to recipients with a track record of successful programs to help reduce poverty in some of the nation’s poorest and most isolated rural communities. Twenty-six community development organizations have been approved to draw upon the funding to provide long-term financing to be “re-lent” to local entities to build, acquire, maintain or renovate essential community facilities. The funds also can be used for capacity building and to finance essential community services, such as education, health care and infrastructure.

“This effort builds on our commitment to lifting up the economic prospects of communities that have not benefited from the revitalization of rural America,” Vilsack said. “By engaging with local and national partners, private-sector financial institutions and philanthropic organizations, USDA will inject a game-changing level of investment capital to reduce poverty in targeted rural areas where the capacity for growth has not been realized. As we have seen with the Obama Administration’s Promise Zone initiative and USDA’s StrikeForce effort, targeted, place-based investments can have a real impact on reducing poverty. This funding adds another important tool in that fight.”

In Maine, Coastal Enterprises, Inc. (CEI) of Brunswick has been selected to receive a Community Facility Direct Relending Program Loan in the amount of $20,000,000 for relending in rural communities in Maine and other states.

Congresswoman Chellie Pingree said, “Maine people are hardworking, creative and full of ingenuity, but too often rural areas just don’t get the investment and don’t have access they to capital that they need to build the local economy.  This money is going to help make sure that the resources we have in rural Maine can be put to work creating jobs for the community.  This is a great economic development investment and is going to pay real dividends for Maine.”

USDA Rural Development State Director Virginia Manuel said, “I am thrilled with this landmark $20 million investment by USDA Rural Development in Coastal Enterprises Inc. The long-standing partnership USDA Rural Development has with CEI represents the immense value of the organization and its vital role in supporting our rural Maine communities. This significant funding will enable CEI to bolster opportunity to our vibrant communities through relending, thereby supporting essential community facilities that Maine’s rural residents rely on.”

“CEI is best-known across Maine as a mission-driven business lender, but vibrant rural communities need more than individual businesses to thrive. They also need community resources that contribute to quality of life and help to retain and attract families and entrepreneurs,” said Betsy Biemann, CEI’s chief executive officer.  “CEI has financed childcare centers, a non-profit school serving youth with behavioral challenges, federally-qualified health centers and other non-profit facilities, and looks forward to working with the USDA Rural Development to channel more funding to facilities like these in small urban centers and rural communities in Maine and in other regions of the U.S.”

As a Re-Lender, CEI will loan funds to applicants primarily for projects in or serving high poverty areas or persistent poverty counties eligible under the Community Facility Loan Program. CEI’s rural lending maintains a focus on micro and small businesses, including natural resources-based industries, as well as community facilities (such as health care, childcare, arts, and social services), affordable housing, renewable energy and microlending. Of the current $39.1 million loan portfolio, $26.9 million, or 68%, is invested in rural regions.

Eligible applicants for the loans financed through the Community Facilities Re-Lending Program may use the funds from CEI to purchase, construct, and/or improve essential community facilities, purchase equipment, and pay related project expenses. Examples of allowable facilities include: health care facilities (such as hospitals, medical or dental clinics, or assisted-living facilities); public facilities such as town halls or courthouses; street improvements; community support facilities such as child care or community centers, fairgrounds, or transitional housing; public safety facilities; and educational facilities such as museums, libraries, colleges, and public or private schools.

Coastal Enterprises, Inc. is a mission-driven lender and investor specializing in rural economic development in Maine and the U.S. Since 1977, CEI and its subsidiaries have provided nearly $1.2 billion in financing to over 2,500 enterprises with over 33,000 jobs; created/preserved over 1,800 units of affordable housing; provided training and counseling to nearly 50,000 individuals and businesses; and created/preserved over 5,800 child care slots. CEI was the first organization in Maine certified by the U.S. Treasury Department as a Community Development Financial Institution and is a NeighborWorks Organization, and a member of the Federal Home Loan Bank of Boston.

The Community Facility Direct Relending Program has two unique features. First, private financial institutions, including Bank of America and others, will be providing guarantees for a portion of the loans. Second, the recipient community development organizations, or “re-lenders,” may also have an opportunity to receive grants provided by seven of the nation’s premier philanthropic organizations through a $22 million fund to assist in managing and capacity building. The Mary Reynolds Babcock Foundation will manage this grant fund.

Vilsack made the announcement at Berea College, which has received USDA funding to help businesses become more energy efficient. Earlier this year, the town of Berea received a $10 million Community Facilities loan to renovate and expand the city hall and public safety facilities.

The project is led by the U.S. Department of Health and Human Services in collaboration with USDA, the Department of Labor, the Corporation for National and Community Service, the Appalachian Regional Commission, the Delta Regional Authority, the Annie E. Casey Foundation, the W.K. Kellogg Foundation and other philanthropic partners. The members of this public/private partnership have selected 10 local and tribal communities and placed AmeriCorps VISTA members there to provide technical assistance and capacity-building resources to reduce child poverty. At a White House Rural Forum convened in State College, Pa., earlier this week, the partners announced that the AmeriCorps VISTA members will remain in the 10 communities for a second year.

USDA expects the financing announced today will serve as a catalyst for additional investment. Many of the community developers already have established relationships with other private and philanthropic funders. The ability to relend money could foster greater leveraging of private and philanthropic investments in rural communities.

USDA Rural Development has a $215 billion loan portfolio and offices in every state in the nation. The agency annually invests $30 billion, on average, in rural communities.

Since 2009, USDA Rural Development (@USDARD) has funded nearly 9,200 community facilities such as schools, public safety and health care facilities; invested nearly $13 billion to start or expand nearly 112,000 rural businesses; helped 1.1 million rural residents buy homes; and helped bring high-speed Internet access to nearly 6 million rural residents and businesses. USDA also has invested $31.3 billion in 963 electric projects that have financed more than 185,000 miles of transmission and distribution lines serving 4.6 million rural residents. For more information, visit www.usda.gov/results.

To read more about USDA’s investments in rural America and its successful turnaround, visit USDA’s entry on Medium.com, Rural America Is Back in Business.

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USDA is an equal opportunity provider, employer and lender.

 

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