MorrisonGrants

USDA Rural Development administers the Biorefinery Assistance Program to provide guaranteed loans for the development and construction of commercial-scale biorefineries or for the retrofitting of existing facilities (including, but not limited to, wood products facilities and sugar mills) for the development of advanced biofuels.

The funds available under this request for applications are funds left over from last year because of an insufficient number of eligible applications submitted. A good number of applications were submitted last year, but many were incomplete or did not comply with the terms of the program and were not considered. Email or call us to see how you can make sure your application is complete.

See information below regarding:

General information

Eligible projects

Key dates

How to apply

Loan application writing

General information:

• Eligible applicants (as stated in the program overview): Individuals, tribal entities, state government entities, local government entities, corporations, farm cooperatives, farmer cooperative organizations, associations of agricultural producers, national laboratories, institutions of higher education, rural electric cooperatives, public power entities, and consortia of any of the previous entities.
• Loan limits: Maximum of $250 million. No minimum requirement. The maximum amount of guaranteed loan will be reduced by the amount of other direct Federal funding the eligible borrower receives for the same project.

Eligible projects:

Projects must be located in a rural area (50,000 or less population; not in an urbanized area). All projects must use “eligible technology,” which is defined as either:

• A technology that is being adopted in available commercial-scale operation of a biorefinery that produces an advanced biofuel; or
• A technology not described in the previous paragraph that has been demonstrated to have technical and economic potential for commercial application in a biorefinery that produces an advanced biofuel.

Eligible materials are advanced biofuels, which the request for applications defines as "fuel derived from renewable biomass, other than corn kernel starch to include:

1. Biofuel derived from cellulose, hemicellulose, or lignin;
2. Biofuel derived from sugar and starch (other than ethanol derived from corn kernel starch);
3. Biofuel derived from waste material, including crop residue, other vegetative waste material, animal waste,
   food waste, and yard waste;
4. Diesel-equivalent fuel derived from renewable biomass, including vegetable oil and animal fat;
5. Biogas (including landfill gas and sewage waste treatment gas) produced through the conversion of organic
   matter from renewable biomass;
6. Butanol or other alcohols produced through the conversion of organic matter from renewable biomass; or
7. Other fuel derived from cellulosic biomass."

Eligible costs include the following:

• Purchase and installation of equipment (new, refurbished, or remanufactured), except agricultural tillage equipment, used equipment, and vehicles
• Construction or retrofitting, except residential
• Permit and license fees
• Professional service fees
• Feasibility studies
• Business plans
• Working capital
• Land acquisition
• Cost of financing, excluding guarantee and renewal fees

Rates and terms:

The following table describes the percentage of the loan that is guaranteed:

Other key points regarding rates and terms:

• The interest rate is negotiated between the lender and the applicant.
• The length of the loan guaranteed under this program would be no more than 20 years or 85% of the useful life of the project.
• A lender must be a regulated or supervised lender.

Key dates:

To be considered for funding, applications must be received by June 1, 2010.

How to apply:

Visit Rural Development's website for contact information and application instructions. We at MorrisonGrants would also be happy to talk with you about any questions you might have--by email or by phone.

Loan application writing:

The professionals at MorrisonGrants have successfully prepared applications for Federal loan guarantee programs. Email us or give us a call to see how we can help. With our experience, we can make sure your application is not disqualified on the grounds of incompleteness and your project has the greatest probability of funding possible.