Rural Business Development Grants

What does this program do?

RBDG 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 that have fewer than 50 employees and less than $1 million in gross revenues. 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

What is an eligible area?

RBDG funds must be directed 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 for enterprise type grants; however, smaller requests are given higher priority.  Generally, grants range from $10,000 up to $500,000.  There is no cost sharing requirement.   Opportunity type grant funding is limited to a maximum award of $50,000 for unreserved funds.  Total opportunity type grant funding is limited statutorily to up to 10% of the total RBDG annual funding.

How may funds be used?

Enterprise type grant funds 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 streets and roads, parking areas, 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 type grant funding must be used for projects in rural areas and they 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 for competitive funding?

RBDG applications compete at the state office level, which are dependent on appropriations.

All applications are evaluated based on:

• Evidence showing job creation to occur with local businesses;
• Percent of nonfederal 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.