The Rural Development/SCTDD Intermediary Relending Program (IRP) Loan Fund can provide competitive rate loans for economic development projects in the thirteen counties included in the South Central Tennessee Development District. These funds must be used in conjunction with other financing sources and can be used only to fill the gap between the amount of financing required for a project and what is available from other sources (both equity and debt). Projects located throughout the thirteen county SCTDD area are eligible with the exception of projects located within the corporate limits of cities with population of more than 25,000. The only city in our region with more than 25,000 is the City of Columbia.

Funding Source: Rural Development - United States Department of Agriculture (formerly Farmers Home Administration)

Administration and Approval: Revolving Loan Fund Committee - South Central Tennessee Development District

Applicant: Any business that proposes to create jobs and increase its capital investment in the community and can identify a financing gap in its project. The unit of government - either city or county - in which the project will be located, must support the project.

Interest Rate: Competitive rates either tied to New York Prime or fixed..

Terms: Buildings - 10 to 15 years

Machinery and Equipment - 5 to 7 years

Working Capital - 3 to 5 years

Funding Availability: Approximately $2.5 million for the SCTDD area.

The maximum amount of IRP funds per project is limited to $250,000 or 75% of the total project costs, whichever is less and at least one new job must be projected for each $5,000 in IRP funds requested.

Items that must be supplied by the business being assisted:

1. Profile sheet on the business including name, address, legal organization, years in business, accountant, nature of product, and description of the project.

2. Employment Projections including the number and types of jobs to be created by the project.

3. Letter of Intent detailing reasons for the proposed project, commitment to follow through with the project, time frame, and reason for the need of IRP assistance.

4. List of all Sources and Uses of funds for the project.

5. Commitment letters from all other sources of financing for the project.

6. Detailed cost estimates for each component of the project.

7. Historical financial statements of the business for the last three years including income statements and balance sheets and an interim financial statement dated within 90 days of the application.

8. For new businesses or those that have not yet shown a profit, pro forma financial statements including pro forma balance sheet as of the completion of the project, pro forma balance sheet at the end of Year 1 and Year 2, income statement for the first 2 years, and monthly cash flow for the first twelve months of operation.

9. Banking and credit references on the business and the principals.

10. Personal financial statements of the owners.

11. Resumes of owners and top management of the company.

12. Marketing plan including company history, market analysis, and specific marketing and sales activities or promotions planned to insure that there is a demand for any increase in production as a result of the proposed project. In some cases, where the market appears questionable, letters of intent from customers may be requested.

13. Organizational chart.

14. List of all stockholders/owners of the business and percent of ownership.

For further information, an application or questions about the uses of the SCTDD IRP Loan Program, please feel free to call Doug Williams at the South Central Tennessee Development District, P. O. Box 1346, Columbia, Tennessee, 38402, at (931) 381-2040.

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