RFP Guide FY 2019.pdf

United States Department of Agriculture

Rural Development

March 2019

Revolving Fund Program

FY 2019 Grant Application Guide

The U.S. Department of Agriculture (USDA) prohibits discrimination in all its programs and activities on the basis of race, color, national origin, sex, religion, age, disability, political beliefs, sexual orientation, and marital or family status. (Not all prohibited bases apply to all programs.) Persons with disabilities who require alternative means for communication of program information (Braille, large print, audiotape, etc.) should contact USDA’s TARGET Center at (202) 720-2600 (voice and TDD).

To file a complaint of discrimination write, USDA, Director, Office of Civil Rights, Room 326-W, Whitten Building, 14th and Independence Avenue, SW, Washington, DC 20250-9410 or call (202) 720-5964 (voice or TDD). USDA is an equal opportunity provider and employer.

The information requested in these guidelines is being collected and used by the Rural Utilities Service to determine eligibility for grants and to meet reporting requirements.

According to the Paperwork Reduction Act, as amended, no persons are required to respond to a collection of information unless it displays a valid OMB control number. The valid OMB control number for this information collection is 0575- 0000. Public burden reporting for this collection of information is estimated to be 60 hours per response, including time for reviewing instructions, searching existing data sources, gathering and maintaining the data needed, and completing and reviewing the collection of information.

Send comments regarding the burden estimate or any other aspect of the collection of information, including suggestions for reducing this burden, to the following addresses:

Program Development and Regulatory Analysis Rural Utilities Service U.S. Department of Agriculture 1400 Independence Ave., SW.

Stop 1522, Room 5168 South Building Washington, DC 20250-1522

Office of Management and Budget Paperwork Reduction Project (0575-0000) Washington, DC 20503.

DO NOT SEND COMPLETED FORMS TO THE

ABOVE ADDRESSES.

** This application guide has been updated with new guidelines and procedures, marked in red. Please read each section thoroughly.

The Revolving Fund Program Grant Application Guide FY 2019

-i-

Table of Contents Revolving Fund Program FY 2019 Grant Application Guide

SECTION 1: THE REVOLVING FUND GRANT PROGRAM

1.1 Introduction

1.2 Authorization

1.3 Available funding for FY 2019

1.4 RFP Program Contacts

1.5 RFP Resources on the Web

SECTION 2: GENERAL CONSIDERATIONS FOR A RFP GRANT

2.1 Eligible Organizations

2.2 Eligible Grant Purposes

2.3 Ineligible Grant Purposes

2.4 Security Requirements

SECTION 3: APPLICATION SUBMISSION PROCESS

3.1 Two Ways of Filing Applications

3.2 DUNS Number Requirement

3.4 Paper Applications

3.5 Electronic Applications

3.6 Deadlines for Grant Applications

SECTION 4: REQUIREMENTS FOR A COMPLETED GRANT

4.1 Preparing the Application

4.2 Required Forms

4.3 Project Proposal

4.3.1 Project Summary

4.3.2 Needs Assessment

4.3.3 Project Goals and Objectives

4.3.4 Project Narrative

4.4 Work Plan

-ii-

4.5 Budget and Budget Justification

4.6 Required Information Not Found on Standard Application Forms

4.6.1 Evidence of Legal Existence

Demonstrate that your organization is legally recognized under state and Federal law. Satisfactory documentation includes, but is not limited to, certificates from the Secretary of State, or copies of state statutes or laws establishing your organization. Letters from the IRS awarding tax-exempt status are not considered adequate evidence

4.6.2 List of Directors and Officers

4.6.3 IRS Tax exempt Status

4.6.4 Debarment and Suspension Rules

4.6.5 Drug-free Workplace Requirements

4.6.6 Audit

4.6.7 Financial statements

4.7 Optional Information Not Found on Standard Application Forms

SECTION 5: APPLICATION REVIEW PROCESS

5.1 Receipt Acknowledgment

5.2 Evaluating the Application

5.3 Scoring Criteria

5.4 Application Selection

5.5 Possible RUS Actions on the Application

5.5 Appeals Process

Appendix—Rules and Regulations

-1-

Section 1: The Revolving Fund Grant Program

1.1 Introduction

Drinking water systems are basic and vital to both health and economic development. With dependable water facilities, rural communities can attract families and businesses that will invest in the community and improve the quality of life for all residents. Without dependable water facilities, the communities cannot sustain economic development.

The Rural Utilities Service (RUS) supports the sound development of rural communities and the growth of our economy without endangering the environment. RUS provides financial and technical assistance to help communities bring safe drinking water and sanitary, environmentally sound waste disposal facilities to rural Americans in greatest need.

The Revolving Fund Grant Program (RFP) has been established to assist communities with water or wastewater systems. Qualified private non-profit organizations will receive RFP grant funds to establish a lending program for eligible entities. Eligible entities for the revolving loan fund will be the same entities eligible to obtain a loan, loan guarantee, or grant from the Rural Utilities Service Water and Waste Disposal and Wastewater loan and grant programs. As grant recipients, the non-profit organizations will set up a revolving loan fund to provide loans to finance predevelopment costs of water or wastewater projects, or short-term small capital projects not part of the regular operation and maintenance of current water and wastewater systems. The amount of financing to an eligible entity shall not exceed $100,000 and shall be repaid in a term not to exceed 10 years. The rate shall be determined in the approved grant work plan.

In this guide, you will find information to help you:

• Assess your eligibility for RUS grant assistance

• Understand how and when to apply

• Create a successful application

1.2 Authorization

The 2002 Farm Bill (the Farm Security and Rural Investment Act of 2002) established the RFP Grant Program. The authorizing statute may be found in the United States Code (7 U.S.C. 1926(a)). The Code of Federal Regulations sets forth the RFP regulation at 7 CFR Part 1783. Please read the regulation in conjunction with these guidelines.

Should any differences result in the interpretation of these guidelines and 7 CFR Part 1783;

the regulation will take precedence over information contained in this guide.

1.3 Available funding for FY 2019

The RFP Program has $1,000,000 available for grant funding in Fiscal Year 2019.

-2-

1.4 RFP Program Contacts

The Water and Environmental Programs (WEP) staff will administer the RFP Program. We encourage you to contact the WEP staff early in the application process with any questions or ideas concerning your proposal. The staff will provide advice on draft proposals before the application deadline or answer your questions about the application process and program requirements.

Telephone: 202-720-9640

Fax: 202-690-0649 Email: derek.jones@wdc.usda.gov

1.5 RFP Resources on the Web

Visit our Website at: https://www.rd.usda.gov/programs-services/water-waste-disposal-revolving-loan-funds

Section 2: General Considerations for a RFP Grant

2.1 Eligible Organizations

An organization is eligible to receive a RFP grant if it:

a. Is a private, non-profit organization that has tax-exempt status from the United States Internal Revenue Service (IRS);

b. Is legally established and located within one of the following:

• a state within the United States

• the District of Columbia

• the Commonwealth of Puerto Rico

• a United States territory

c. Has the legal capacity and authority to carry out the grant purpose;

d. Has a proven record of successfully operating a revolving loan fund to rural areas;

e. Has capitalization acceptable to the Agency, and is composed of at least 51 percent of the outstanding interest or membership being citizens of the United States or individuals who reside in the United States after being legally admitted for permanent residence;

f. Has no delinquent debt to the Federal Government or no outstanding judgments to repay a Federal debt;

-3-

g. Demonstrates that it possesses the financial, technical, and managerial capability to comply with Federal and State laws and requirements.

2.2 Eligible Grant Purposes

The following activities are authorized under the RFP statute:

a. Grant funds must be used to capitalize a revolving fund program for the purpose of providing direct loan financing to Ultimate Recipients for pre-development costs associated with proposed or with existing water and wastewater systems; or

b. Short-term costs incurred for equipment replacement, small-scale extension of services, or other small capital projects that are not part of the regular operations and maintenance activities of existing water and wastewater systems.

2.3 Ineligible Grant Purposes

Grant funds may not be used to pay any of the following:

a. Payment of the Intermediary's administrative costs or expenses.

b. Delinquent debt owed to the Federal Government.

2.4 Security Requirements

A grant agreement will be executed between the Intermediary and the Agency.

Section 3: Application Submission Process

3.1 Two Ways of Filing Applications

You may file an application in either paper or electronic format. Send or deliver paper applications by the U.S. Postal Service (USPS) or courier delivery services to the RUS receipt point. File an application electronically through Grants.gov, the official Federal Government website at https://www.grants.gov. RUS will not accept applications by fax or email.

3.2 DUNS Number Requirement

Whether you file a paper or an electronic application, you will need a DUNS number. DUNS Number. DUNS Number. The applicant for a grant must supply a Dun and Bradstreet Data Universal Numbering System (DUNS) number as part of an application. The Standard Form 424 (SF–424) contains a field for the DUNS number. The applicant can obtain the DUNS number free of charge by calling Dun and Bradstreet at 1-866-705-5711. Please see http://fedgov.dnb.com/webform for more information on how to obtain a DUNS number or how to verify your organization’s number.

https://www.grants.gov/ http://fedgov.dnb.com/webform

-4-

You will need the following pieces of information when requesting a DUNS number:

Legal Name Headquarters name and address of the organization Doing business as (dba) or other name by which the organization is commonly recognized.

Physical address Mailing address (if separate from headquarters and/or physical address) Telephone number Contact name and title Number of employees at the physical location

Prior to submitting an application, the applicant must register in the System for Award Management (SAM) (formerly Central Contractor Registry, (CCR)). Applicants may register for the SAM at https:// www.sam.gov/portal/public/SAM/. The SAM registration must remain active with current information at all times while RUS is considering an application or while a Federal Grant Award or loan is active. To maintain the registration in the SAM database the applicant must review and update the information in the SAM database annually from date of initial registration or from the date of the last update. The applicant must ensure that the information in the database is current, accurate, and complete.

3.4 Paper Applications

Mail or ensure delivery of an original paper application (no stamped, photocopied, or initialed signatures) and two copies by the deadline date to the following address:

Assistant Administrator Water and Environmental Programs Rural Utilities Service Attention: Derek Jones 1400 Independence Avenue, S.W.

STOP 1570, Room 2233-S Washington, DC 20250-1548

The application and any materials sent with it become Federal records by law and cannot be returned to you.

3.5 Electronic Applications

You must file an electronic application at the website: https://www.grants.gov. You must be registered with Grants.gov before you can submit a grant application.

3.6 Deadlines for Grant Applications

https://www.sam.gov/portal/public/SAM/ https://www.sam.gov/portal/public/SAM/ https://www.grants.gov/

-5-

The deadline for the RFP is May 27, 2019. All applications must be postmarked or time-stamped electronically by the filing deadline to be considered for the grant period. Late or incomplete applications will not be eligible for FY 2019 grant funding.

An application will be considered on time if it is received by the deadline date or mailed on or before the deadline date. If the application is filed electronically, an electronic date and time stamp on or before the receipt date will be considered on time. Paper applications must show proof of mailing or shipping consisting of one of the following:

• A legibly dated USPS postmark;

• A legible mail receipt with the date of mailing stamped by the USPS; or

• A dated shipping label, invoice, or receipt from a commercial carrier

Note: Packages arriving at USDA via the USPS are irradiated, which can damage the contents. RUS encourages you to consider the impact of this procedure in selecting your application delivery method. Also, if there is a disruption in mail delivery service, we strongly encourage you to submit applications via express mail or commercial delivery to our office.

If a receipt date falls on a weekend, it will be extended to the following Monday. If the date falls on a Federal holiday, it will be extended to the next business day.

Section 4: Requirements for a Completed Grant

4.1 Preparing the Application

To be considered for support, you must be an eligible entity and must submit a complete application by the deadline date. You should consult the cost principles and general administrative requirements for grants pertaining to their organizational type in order to prepare the budget and complete other parts of the application. You also must demonstrate compliance (or intent to comply), through certification or other means, with a number of public policy requirements.

Completed Application

1. Standard application forms

2. A proposal

3. A work plan

4. A budget and budget justification

5. Evidence of legal existence and legal authority

6. A list of directors and officers

7. Other specified information

-6-

4.2 Required Forms

Applicants must complete and submit the following forms to apply for a RFP grant:

• Standard Form 424, “Application for Federal Assistance”

• Standard Form 424A, “Budget Information—Non-Construction Programs”

• Standard Form 424B, “Assurances—Non-Construction Programs”

• Standard Form LLL, “Disclosure of Lobbying Activity”

• Form RD 400-1, “Equal Opportunity Agreement”

• Form RD 400-4, “Assurance Agreement (Under Title VI, Civil Rights Act of 1964

4.3 Project Proposal

The project proposal should outline the project in sufficient detail to provide a reader with a complete understanding of how the loan program will work. Explain what you will accomplish by lending funds to eligible entities. Demonstrate the feasibility of the proposed loan program in meeting the objectives of this grant program. The proposal should cover the following elements:

4.3.1 Project Summary

Present a brief project overview. Explain the purpose of the project, how it relates to RUS’s purposes, how you will carry out the project, what the project will produce, and who will direct it.

4.3.2 Needs Assessment

Describe why the project is necessary. Demonstrate that eligible entities need loan funds.

Quantify the number of prospective borrowers or provide statistical or narrative evidence that a sufficient number of borrowers will exist to justify the grant award. Describe the service area. Address community needs.

4.3.3 Project Goals and Objectives

Clearly state your project goals. Your objectives should clearly describe the goals and be concrete and specific enough to be quantitative or observable. They should also be feasible and relate to the purpose of the loan program.

4.3.4 Project Narrative

The narrative should cover in more detail the items briefly described in the Project Summary.

It should establish the basis for any claims that you have substantial expertise in promoting the safe and productive use of Revolving Funds. In describing what the project will achieve, you should tell the reader if it also will have broader influence. The narrative should address the following points:

• Document your ability to administer and service a revolving fund in accordance with the provisions of 7 CFR Part 1783.

-7-

• Document that, to establish the revolving fund, you can commit financial resources your organization controls. This documentation should describe the sources of funds other than the RFP grant that will be used to pay your operational costs and provide financial assistance for projects.

• Demonstrate that you have secured commitments of significant financial support from other funding sources, if appropriate.

• List the fees and charges that borrowers will be assessed.

4.4 Work Plan

The work plan must describe the tasks and activities that will be accomplished with available resources during the grant period. It must show the work you plan to do to achieve the anticipated outcomes, goals, and objectives set out for the RFP Program. The plan must:

• Describe the work to be performed by each person.

• Give a schedule or timetable of work to be done.

• Show evidence of previous experience with the techniques to be used or their successful use by others.

• Outline the loan program to include the following: specific loan purposes, a loan application process; priorities, borrower eligibility criteria, limitations, fees, interest rates, terms, and collateral requirements.

• Provide a marketing plan.

• Explain the mechanics of how you will transfer loan funds to the borrowers.

• Describe follow-up or continuing activities that should occur after project completion such as monitoring and reporting borrowers’ accomplishments.

• Project Evaluation. It should describe how the results will be evaluated, in line with the project objectives.

• Personnel. The applicant should list all personnel responsible for administering this program along with a statement of their qualifications and experience.

4.5 Budget and Budget Justification

The written justification for projected costs should explain how budget figures were determined for each category. It should indicate which costs are to be covered by grant funds and which costs will be met by your organization or other organizations. The justification should account for all expenditures discussed in the narrative. It should reflect appropriate cost-sharing contributions. The budget justification should explain the budget and

-8-accounting system proposed or in place. The administrative costs for operating the budget should be expressed as a percentage of the overall budget. The budget justification should provide specific budget figures, rounding off figures to the nearest dollar. Applicants should consult OMB Circular A-122: "Cost Principles for Non-Profit Organizations" for information about appropriate costs for each budget category.

4.6 Required Information Not Found on Standard Application Forms

In addition to completing the standard application forms, you must submit supplementary materials.

4.6.1 Evidence of Legal Existence

Demonstrate that your organization is legally recognized under state and Federal law.

Satisfactory documentation includes, but is not limited to, certificates from the Secretary of State, or copies of state statutes or laws establishing your organization. Letters from the IRS awarding tax-exempt status are not considered adequate evidence.

4.6.2 List of Directors and Officers

Submit a certified list of directors and officers with their respective terms.

4.6.3 IRS Tax exempt Status

Submit evidence of tax-exempt status from the Internal Revenue Service.

4.6.4 Debarment and Suspension Rules

You must disclose debarment and suspension information required in accordance with 7 CFR, Part 3017, subpart 3017.335, if it applies. The section heading is “What information must I provide before entering into a covered transaction with the Department of Agriculture?” It is part of the Department of Agriculture’s rules on Government-wide Debarment and Suspension.

4.6.5 Drug-free Workplace Requirements

You must identify all of your organization’s known workplaces by including the actual address of buildings (or parts of buildings) or other sites where work under the award takes place. Workplace identification is required under the drug-free workplace requirements in accordance with 2 CFR part 182 Governmentwide Requirements for Drug-Free Workplace (Financial Assistance) and 2 CFR part 421 Requirements for Drug Free Workplace (Financial Assistance).

4.6.6 Audit

Submit the most recent audit of your organization.

4.6.7 Financial statements

Submit the following financial statements:

-9-

• A pro forma balance sheet at start-up and for at least three additional years;

• Balance sheets, income statements, and cash flow statements for the last three years.

If your organization has been formed less than three years, the financial statements should be submitted for the periods from inception to the present.

• Projected income and cash flow statements for at least three years supported by a list of assumptions showing the basis for the projections.

The projected income statement and balance sheet must include one set of projections that shows the revolving loan fund only and a separate set of projections that shows your organization's total operations.

• Provide the number (s) and the dollar amounts of write offs from your current program for the last five years.

• Provide the number of delinquencies your agency has had in the last five years of your program and the amount in dollars it has cost your program.

• Provide the current balance from your previous RLP program your agency will be able to contribute to your new RLP for the new program year. The balance would include any left-over funding from line items such as administration fees, set aside, and other items. (you can use your own budget for selecting line items to provide this information)

4.7 Optional Information Not Found on Standard Application Forms

You may present additional information to support and describe your plan for achieving the grant objectives. The information may be regarded as essential for understanding and evaluating the projects such as letters of support, resolutions, policies, etc. The supplements may be presented in appendices to the proposal.

Section 5: Application Review Process

5.1 Receipt Acknowledgment

By letter sent within 30 days of receiving your application, RUS will acknowledge the application’s receipt. Your application will be reviewed for completeness to determine if you included all of the items required. If your application is incomplete or ineligible, RUS will return it to you with an explanation.

5.2 Evaluating the Application

A review team, composed of at least two members, will evaluate all applications and proposals. They will make overall recommendations based on factors such as eligibility, -10-application completeness, and conformity to application requirements. They will score the applications based on criteria in the next section.

5.3 Scoring Criteria

All applications that are complete and eligible will be ranked competitively based on the following scoring criteria:

Scoring Criteria Points

1. Degree of expertise and successful experience in making and servicing commercial loans, with a successful record.

Up to 30 points

2. Percentage of applicant contributions. Points allowed under this paragraph will be based on written evidence of the availability of funds from sources other than the proceeds of a RFP grant to pay part of the cost of a loan recipient’s project.

In-kind contributions will not be considered. Funds from other sources as a percentage of the RFP grant and points corresponding to such percentages are as follows:

(a) Less than 20 percent Ineligible

(b) At least 20 percent but not more than 49 percent of the total project costs

10 points

(c) At least 50 percent of the total project costs 20 points

3. Extent to which the work plan demonstrates a well thought out comprehensive approach to accomplishing objectives; clearly defines who will be served by the project or program; clearly articulates the problem/issues to be addressed, identifies the service area to be covered by the RFP loans, and appears likely to be sustainable.

Up to 40 points

4. Extents to which the goals and objectives are clearly defined, tied to the work plan, and are measurable.

Up to 15 points

5. Lowest ratio of projected administrative expenses to loans advanced. Up to 10 points

6. Evaluation methods for considering loan applications and making RFP loans are specific to the program, clearly defined, measurable, and are consistent with program outcomes.

Up to 20 points

7. Administrator’s discretion *, taking into consideration such factors as: Up to 10 points

(a) Creative outreach ideas for marketing RFP loans;

(b) Amount of funds requested in relation to the amount of needs demonstrated in the proposal;

(c) Excellent utilization of a previous revolving loan fund; and

(d) Optimizing the use of agency resources.

* Administrator’s discretion points may be awarded based on the following:

1. Directs loans to the smallest communities with the lowest incomes emphasizing areas where according to the American Community Survey data by census tracts show that

-11-at least 20 percent of the population is living in poverty. This emphasis will support Rural Development’s goal of providing 20 percent of its funding by 2016 to these areas of need.

2. Directs loans to areas which lack running water, flush toilets, and modern sewage disposal systems, and areas which have open sewers and high rates of disease caused by poor sanitation, in particular, colonias or Substantially Underserved Trust Areas

3. Directs loans that emphasize energy and water efficient components to reduce costs and increase sustainability of rural systems; up to 10 points

5.4 Application Selection

RUS will rank all qualifying applications by their final score. Applications will be selected for funding, based on the highest scores and the availability of funding for RFP grants. Each applicant will be notified in writing of the score its application receives.

5.5 Possible RUS Actions on the Application

In making its decision about your application, RUS may determine that your application is:

• Eligible and selected for funding,

• Eligible but offered fewer funds than requested,

• Eligible but not selected for funding, or

• Ineligible for the grant.

5.5 Appeals Process

In accordance with 7 CFR part 1900, subpart B, you generally have the right to appeal adverse decisions. Some adverse decisions cannot be appealed. For example, if you are denied RUS funding due to a lack of funds available for the grant program, this decision cannot be appealed.

However, you may make a request to the National Appeals Division (NAD) to review the accuracy of our finding that the decision cannot be appealed. The appeal must be in writing and filed at the appropriate Regional Office, which can be found at:

https://www.nad.usda.gov/or by calling (703) 305-1166.

-12-

Appendix—Rules and Regulations

These rules and regulations have been mentioned throughout the text of the guidelines but are listed in one place for easy reference. The Code of Federal Regulations is located at https://www.ecfr.gov the OMB circulars are located https://www.whitehouse.gov/omb/circulars/.

7 Code of Federal Regulations (CFR) part 1783: “Revolving Fund Grant Program”

2 CFR part 417, “Governmentwide Debarment and Suspension (Nonprocurement)”

Subpart B of 2 CFR part 421, which adopts the “Governmentwide Requirements of the Drug-free Workplace Act (Financial Assistance)”

7 CFR part 1900, subpart B, “Adverse Decisions and Administrative Appeals”

7 CFR part 3015: “Uniform Federal Assistance Regulations”

7 CFR part 3019: “Uniform Administrative Requirements for Grants and Agreements with Institutions of Higher Education, Hospitals, and Other Non-Profit Organizations”

OMB Circular A-122: “Cost Principles for Non-Profit Organizations”

4.7 Optional Information Not Found on Standard Application Forms