Why USDA Rural Development Funding Matters
The U.S. Department of Agriculture's Rural Development (RD) office is one of the most active sources of infrastructure, business, and community grant funding outside of HUD and the Department of Transportation. In fiscal year 2024, USDA Rural Development invested over $41 billion in rural communities through loans, grants, and loan guarantees — supporting water systems, broadband, health clinics, housing, businesses, and renewable energy. The federal rural development portfolio is often overlooked by nonprofits and local governments because the USDA is primarily associated with agriculture, but less than a third of RD funds go to farm-specific programs.
If your organization serves a community with a population under 50,000, you likely qualify for at least one USDA Rural Development program.
Community Facilities Programs
Community Facilities Direct Grants
The Community Facilities (CF) Direct Grant program provides grants to public bodies, nonprofits, and federally recognized tribes to develop essential community facilities in rural areas. Eligible facilities include health care clinics, fire and rescue stations, libraries, schools, child care centers, and public safety facilities. Grant amounts depend on the median household income of the service area: communities with lower incomes receive a higher percentage of project costs as a grant (up to 75%), with the remainder as a low-interest loan.
Maximum grant amounts are $25,000 for most projects, though larger amounts are available for specific categories including rural healthcare. Applications are accepted on a rolling basis through local USDA RD state offices — not through Grants.gov for most CF programs.
Community Facilities Technical Assistance Grants
Organizations that help rural communities develop community facilities can apply for CF Technical Assistance grants of up to $150,000 to fund pre-development work, feasibility studies, and capacity building for rural communities that lack the staff to navigate federal programs on their own.
ReConnect Broadband Program
The ReConnect Program provides loans, grants, and loan-grant combinations to deploy high-speed broadband in rural areas that lack sufficient service (currently defined as areas where 90% of households lack access to 100 Mbps speeds). ReConnect is one of USDA's largest competitive grant programs, with Congress appropriating over $2.8 billion in recent funding rounds.
ReConnect grants in Round 4 ranged from $100,000 to $25 million. Eligible applicants include electric cooperatives, telecommunications companies, nonprofits, local governments, and tribes. Round 5 solicitations were expected in 2025; check rd.usda.gov/programs-services/telecom-programs/reconnect-program for current status.
Water and Environmental Programs (WEP)
USDA provides grants and loans for water and wastewater infrastructure in rural communities with populations under 10,000. Programs include:
- Water and Waste Disposal Grants: Up to 75% of project costs (with no dollar cap stated, though typical awards range from $500,000 to $5 million) for water treatment systems, wastewater facilities, solid waste disposal, and stormwater systems.
- Emergency Community Water Assistance Grants: Up to $1 million for communities facing a significant decline in quantity or quality of their water supply due to an emergency.
- Circuit Rider Program: Technical assistance grants to organizations that provide on-site assistance to rural water and wastewater systems.
Applications go through your state's USDA Rural Development office. Median household income thresholds apply — lower-income communities receive higher grant percentages.
Rural Business Development Grants (RBDG)
The Rural Business Development Grant program funds technical assistance and training for small rural businesses and supports rural business development projects. Two categories exist:
- Opportunity grants: Up to $50,000 for specific business development opportunities — training, technical assistance, market research, feasibility studies.
- Business Enterprise grants: Up to $500,000 for larger projects including revolving loan funds, business incubators, and small business training programs.
Eligible applicants include nonprofits, public bodies, tribes, and rural cooperatives. For-profit businesses are not eligible, but nonprofits that provide business development services to small rural businesses are. Applications are accepted annually; check Grants.gov for current solicitations.
Rural Energy for America Program (REAP)
REAP provides grants and loan guarantees to agricultural producers and rural small businesses for renewable energy systems and energy efficiency improvements. The 2022 Farm Bill substantially increased REAP funding, with the Inflation Reduction Act adding an additional $2 billion.
Grant amounts: up to 25% of eligible project costs for renewable energy, up to 25% for energy efficiency, with a maximum grant of $1 million for renewable energy systems and $500,000 for energy efficiency projects. Smaller grants under $20,000 have a simplified application process. Eligible technologies include solar, wind, geothermal, biomass, biogas, and energy efficiency retrofits for commercial and agricultural buildings.
Rural Housing Programs
USDA Section 533 Housing Preservation Grants provide funds to nonprofits and public bodies to repair and rehabilitate housing for low- and very-low-income rural residents. Grants are awarded to organizations (not individuals) that then administer repair programs in their service areas. Annual awards typically range from $50,000 to $500,000.
The Section 502 Direct Home Loan program is not a grant, but it provides subsidized mortgages to rural households with incomes below 80% of AMI — making homeownership accessible in communities where market-rate financing is not viable.
Value-Added Producer Grants (VAPG)
VAPG helps agricultural producers enter value-added markets by funding planning and working capital for projects that increase farm income. Grants range from $75,000 (planning grants) to $250,000 (working capital grants). Beginning farmers, socially disadvantaged farmers, and mid-tier value chains receive priority scoring. Applications open annually through Grants.gov; check for current NOFA (Notice of Funding Availability) postings.
How to Apply for USDA Rural Development Grants
- Contact your state USDA RD office first: Unlike most federal agencies, USDA Rural Development processes many applications through state and local offices rather than a central portal. Your state office can confirm current funding availability and application requirements.
- Confirm rural eligibility: USDA maintains an eligibility mapping tool at eligibility.sc.egov.usda.gov where you can verify whether your community qualifies as rural for each program.
- Register in SAM.gov: Required for any federal grant applicant. Registration takes 1–2 weeks for new entities.
- Prepare a community needs assessment: CF and water grants require documentation of community need. Census data, local utility reports, and community letters of support strengthen applications.
- Partner with local utilities or governments: Many USDA programs prefer or require co-applicants. Electric cooperatives, water districts, and municipal governments are natural partners for rural infrastructure grants.
Find USDA and Rural Grants in One Place
USDA Rural Development runs dozens of programs across six program areas, and new solicitations open throughout the year. FindGrants.io indexes USDA Rural Development opportunities alongside grants from HUD, EDA, EPA, and hundreds of foundations — filtered by your organization's location, type, and focus area. Search once and see every relevant rural funding opportunity ranked by fit.