The RBEG program provides grants that facilitate the development of small and emerging rural businesses, to help fund distance learning networks, and help fund employment-related training programs. The RBEG grants may be made to public bodies, private nonprofit corporations, and Indian Tribes on Federal and State reservations and other Federally-recognized Indian Tribal groups in rural areas. RBEG grants must finance or develop small and emerging private business enterprises.
We expect benefits to the public to be evidenced in improvements in the quality of life in rural areas, job creation and retention, infrastructure improvement, improved worker skills.
a. Improving the Rural Quality of Life: The public will benefit by having a stronger local economy. Economic development, as facilitated by these ARRA funds, will create and retain jobs.
One example of an economic development benefit would be the start up or expansion of a rural business incubator. Incubators are operated for the specific purpose of assisting new businesses through the start up and initial expansion phases of business operation. Often, incubators offer special services to the tenant businesses such as shared administrative services, shared advertising, below market rate rent, and so forth. They also often provide technical assistance and/or training to the incubator tenants building strengths in business management skills, management of accounts receivable, marketing skills, understanding tax requirements, understanding local ordinances, and other such skills to help ensure long term survival. The introduction of a business incubator to a small town can immediately create new businesses and the jobs that accompany them. Over time, tenants will outgrow the incubator and move to other commercial properties in the community, making way for new tenants.
Another example would be the capitalization of a Rural Revolving loan fund. Revolving loan funds assist with the availability of commercial capital when loans from traditional financial institutions may not be available. Loans made from such revolving funds may be used for any eligible project type. Thus, a grant to rural revolving loan fund may become a loan for an upgrade to a business, (improve visibility, increase energy efficiency, expand an assembly line, increase production) and save or create new jobs.
b. Jobs Created or Saved: While the exact number and mix of jobs created by an RBEG will vary, we expect that most of the jobs will be above minimum wage and be sufficient to support a family. Jobs created in an incubator, for instance, could be of any variety from light manufacturing to software development. Jobs created or retained due to revolving fund activity will be in a wide variety of business types.
We do not anticipate providing RBEG ARRA funding directly for construction purposes. However, an RBEG funded revolving fund could make a construction loan. The construction of a business incubator, for instance, would involve engineers and architects to design and oversee the construction; skilled and unskilled laborers to build the project; new and expanding businesses to be housed in the incubator; advertising, training, and business management experts to provide normal incubator services and so forth.
With job growth comes the need for secondary (support structure) jobs such as manufacturing jobs in materials supply, equipment provision. These would include jobs in sectors such as refineries and chemical plants; steel and iron works; heavy machinery; and transportation via rail, long haul trucking, and local delivery.
Other secondary jobs that may be created include those in the fields of medicine, retailing, and others such as doctors, nurses, technicians, and administrative support. Businesses that can be attracted to incubators include tool and die companies, utility manufacturers, modular building construction, leather manufacturing and signage and large fabric utilization; and other subsidiary businesses to support these companies.
Skills improvement as a result of funding: