USDA key player in economic developmentThe USDA Rural Development began raising awareness of its ability to help grow communities with its $46 million in loans for construction of a new facility for Jamestown Hospital.
By: Toni Pirkl, The Jamestown Sun
The USDA Rural Development began raising awareness of its ability to help grow communities with its $46 million in loans for construction of a new facility for Jamestown Hospital.
The unprecedented amount of U.S. Department of Agriculture funding has made it possible to build a state-of-the-art regional medical center in Jamestown. The $46 million was split into $31 million in a direct USDA loan and $15 million in a guaranteed loan, with low interest rates. It was the largest amount of funding USDA Rural Development has ever provided for a project in North Dakota.
“Without stimulus dollars this project wouldn’t have happened,” said Jasper Schneider, state director for USDA Rural Development. “This was also one of the larger projects across the country. It fits in what I think USDA Rural Development should be.”
Schneider believes North Dakota communities need up-to-date health care facilities if economic development is going to work in the state. As a graduate of Jamestown College, he said he was aware of just how outdated the present Jamestown Hospital is. And much of his background centers around health care.
“This project is exciting for me as this is an issue I care so much about,” he said. “We’re working with about a half-dozen clinics, hospitals and long-term care facilities in the state.”
As it turned out, USDA made it possible to fund construction of the Jamestown Regional Medical Center, which begins in the spring. However, it’s not where hospital officials originally thought to look.
“Our decision to look for funding at USDA started with the collapse of the credit markets and on the advice of our consultant,” said Alan O’Neill, Jamestown Hospital vice president of finance. “There were no other options for us. And we couldn’t have found rates like this anywhere.”
The USDA financing option started with a meager $3 million and O’Neill said they were told it would be a stretch to ask for $8 million. Then stimulus money became available and the number climbed to $46 million.
“The USDA folks were such great advocates for this project and so helpful,” O’Neill said.
The application process is complicated and extensive, he said. Just the pre-application filled a 5-inch binder. The final application included a feasibility study with historic and future budgets to determine whether it was an affordable project.
“It’s a very rigorous process. The requirements are very explicit,” O’Neill said. “But the USDA folks helped us comprehend them. They were so passionate about this project.”
Schneider said a project such as this would have raised red flags for a bank.
“This is not a good investment for a bank,” he said. “That’s where USDA Rural Development steps in. We have a lot of options in our arsenal. No project is too big or too small that we can’t be involved in it.”
Begun as the Farmers Home Administration, it transitioned to USDA Rural Development in 1994-95.
“They kept a pretty low profile. Now we’re raising the profile on our services,” Schneider said. “We have grants and loans available for all kinds of projects. It’s pretty remarkable what we can do in our office.”
With the many programs and options available, Schneider joked they could build a town from scratch. And as only one-third of the stimulus funds have been distributed, he said “it’s a great time to contact us.”
Deb Kantrud, executive director of the South Central Dakota Regional Council, said her agency has worked hand in hand with USDA Rural Development on a number of projects. For example, USDA provides low-interest loans and grants on infrastructure projects such as construction of water and sewer lines. Other USDA programs include housing, utilities and community facilities.
“We work with many communities who are accessing USDA funds,” Kantrud said. “They’re a key player in keeping a community thriving.”
Sun reporter Toni Pirkl can be reached at (701) 952-8453 or by e-mail at firstname.lastname@example.org