Economic Development
Financing Programs

Tennessee CDBG Loan Program | Tennessee Valley Authority
Other State Loan Programs

TENNESSEE CDBG LOAN PROGRAM

The U.S. Department of Housing and Urban Development allocates funding to the State of Tennessee on an annual basis for the Community Development Block Grant program (CDBG). The program is administered by the Tennessee Department Of Economic and Community Development. A portion of the CDBG funds that the State receives is reserved for economic development loan projects. Local governments apply for loan funds on behalf of industries that are locating or expanding within their jurisdictions. Program specifics are as follows:

Program offers fixed asset financing (land, buildings, equipment) at below market interest rates and attractive terms (7 years for equipment and 15 years for buildings) - in non-distressed counties, interests rates start at 3 points below prime and then increase by one percentage point for every five years of term. In distressed counties, interests rates start at 5 points below prime and then increase by one percentage point for every five years of term. Interest rates cannot be less than 1 percent at any time.
Maximum loan of $500,000 in non-distressed counties, $750,000 in distressed counties.
Job creation is required, also, at least 51% of the new jobs created must be reserved for qualified low and moderate income persons.
Application process takes about 90 to 120 days to complete - main components are

Meeting with state loan officers
Environmental review
Community resolution
Company business plan
Company financials - historical & pro forma

TENNESSEE VALLEY AUTHORITY

The Tennessee Valley Authority administers the Economic Development Loan Fund (EDLF) throughout the Tennessee Valley. The program provides low interest loans to established companies that are locating or expanding within the Tennessee Valley. Loans can be made for buildings, plant equipment, infrastructure or property purchases based upon:

Capital investment leveraged
Number of jobs created
Power load generated
Geographic diversity

Maximum loan investment is $2,000,000 per project. TVA investment cannot exceed 25% of the total project costs.

In addition, TVA also administers the Special Opportunity Counties (SOC) program. SOC loan funds are only available to companies that locate or expand within distressed counties. Loans can be made for buildings, plant equipment, infrastructure or property purchases. The maximum loan investment is $300,000.

OTHER STATE LOAN PROGRAMS

The State of Tennessee also administers loan programs that provide financing to small businesses for the construction or renovation of child care facilities (Tennessee Child Care Facilities Corporation) and the renovation of facilities in order to improve energy efficiency (Small Business Energy Loan Program).

Economic Development Financing Programs

Economic Development
Financing Programs