Is it feasable that FEMA and Rural Development grants could go together?

[LFDAC21]

Here's our situation. We're a small volunteer department that runs less than 30 calls per year. We'd like to apply in 2004 for a new pumper. Our current pumper is a 1976. We also own a 1981 Quint, and a 1975 equipment van. We've also investigated the Rural Development grant/loan program. I'm looking for feedback on this possible combination of the grants. I'm using round numbers to keep this simple. Let's say we are looking for a $200K truck. If Rural Development gives us a grant for $50K, do you think FEMA would allow us to ask for 50% of the balance, or $75K as a FEMA grant, with our match being $7500? The FEMA Grant would then be used to pay down the loan portion. I have spoken to a Rural Development rep and he said that his agency sees no problem with it, but he wasn't sure if FEMA would consider it. What do you think?

[BC79er_OLDDELETE]

No, FEMA doesn't allow grant funds to be used for existing loans, or to finance potential loans contingent on being awarded. The project has to be something entirely new and funded only by the grant award. You can't even get a loan to be your matching funds, it has to be cash in hand. All is in the fine print of the program rules.

Fortunately or unfortunately, it appears as if the rule writers thought of all these type of situations first. No loopholes anywhere. That's how I know real politicians had nothing to do with the program: they don't craft anything without a loophole you could drive a truck through.

[tmnkwd]

Brian,

I agree that you can not use the Fire Act Grant to pay off existing loans, but I don’t recall there being anything about not having to have cash in hand for your share. If I recall, we were told that it doesn’t matter how they come up with their share; beg, borrow or steal. I remember many applications stating that they had loan guarantees in place if they received the grant. I just don’t recall how we evaluated those.

If that is the case, could they not use the Rural Development grant as their share? I’m pretty sure that they could. I don’t know enough about the Rural Development grants to speculate whether they would consider a grant that was contingent upon receiving some other grant. If they are, I would think that LFDAC21 has some problems.

A department that runs 30 calls a year is not going to attract a lot of attention to any peer review panel to begin with, unless they really plead their case well in the narrative. Thus, the reason for the Rural Development grants. Add to that the fact that they are applying for a truck and the pickings get even slimmer. The way the money was allocated last year, and we assume this year, if you ask for a truck, chances are you will be sitting here next year wondering whether you will be awarded a grant. There is just too little money in this category. OK, too little means 200,000,000.00 but still, too little money for all the people asking.

They might be better off getting the $50,000.00 from Rural Development, getting a used truck and using the Fire Act to outfit it.

[BC79er_OLDDELETE]

That would be my recommendation as well. Considering the number of departments that ran 100-500 calls per year that got denied, that had older engines and no quint, I don't see that application getting past the computer rankings to be reviewed.

True, technically you didn't have to have cash in hand, but they are cutting back on the awarding based on speculation of the department having the money. Too many are losing the guaranteed loans, or just not able to raise the money in the way that they said they would by the end of the 12 months, and the money gets re-awarded at a later date (like the 12 or so from 2002 that were given out without a press release in Sept 2003). Considering there's a minimum of 4-5 months between application deadline and the first round of awards, you're not going to find too many banks to guarantee a loan that long at the same interest rate. Just not good business on their end. At least the larger banks will think that way.

Tyler can't comment on this statement since you would have to give away family secrets, but many departments that run lower call volumes were successful in going for slightly used trucks instead of brand new ones like on previous applications. For only running 100 or less calls, better cost-benefit.

[tmnkwd]

Actually, I don't think that is a family secret. Cost Benefit was a criteria in the peer review scoring.

I agree, there is a much greater cost benefit to a department who has just bought a “new” $50,000.00 truck with proceeds from another grant and then outfits it with new gear under the Fire Ops & Safety category. Heck, I don’t know that they even have to tell the Fire Act Grant that they received the truck or other proceeds from another grant. I sure wouldn’t if I didn’t have to disclose that. Just say, “We were able to secure funding to purchase a used 19XX … and are now in need of continuing our forward development with the most critical component of fire fighting; protective gear and current equipment, to assist us in fulfilling our mission to the citizens of our district…..

That might help drive the message home that you are actively trying to develop your department into a fire fighting organization capable of handling emergencies of all types, likely to been seen in your area, rather than continuing to seem like you are asking for hand outs from every government department.

Don’t get me wrong. It is unfortunate that too many departments have to do just that. I’m saying, put your best foot forward. Make sure that your accomplishments are loud and clear.

Oh, Brian. Tyler was another panelist. I'm different. However, my name is not in my ID and I would like to be asked back :-)

[BC79er_OLDDELETE]

That's right, Tyler is ttjjss. Sorry, my mistake. Of course I'm sure you've been called worse things. I have. Even wrote a few of them down so I wouldn't forget.

[toddman]

I do not know how much you have checked into the USDA-RD grants but they are a whole different beast than the Fire Act. I was very much involved with a project that we requested and received a Rural Development grant for. The paperwork and research for the RD grant is very significant compared to the fire act grants. Also, the award amount is based on your areas average income. Another concern with the RD grant is that no more than 75% of total project funding can be federal monies. At least this was the criteria that we had to run with two years ago. Basically, if you have not yet done so, check with your local RD people, ours were very helpful. The RD grants work but you better have deep desire for your project becasue it likely will not happen quick and the process can take many man hours.

Also, keep in mind that RD offers some very good loans programs too. I know everybody wants grant but we all don't get them.

[jboczek]

Correct me if I'm wrong, but didn't the application have a question on it asking if the dept. had received any other federal grant this year? There must have been a reason for asking that question.
We've got a RD grant awaiting approval of a STATE grant. That's one of the conditions of receiving the RD grant, so they will allow state grant money to be used for the local share. I'm pretty sure other federal money can be used, too, since they do that with water and wastewater projects.

[LFDAC21]

I want to thank everyone who has offered an opinion on this. It really has been a big help. I'm going to be using this advice and information when our truck committee goes to the village council with possible options.

So, if I am reading this right, you guys are saying two things. First, a FEMA grant can not be used to pay down a loan on an existing project/truck. Second, a department with 30 runs per year will not make it through the computer grading when looking for a truck grant.

I figured that this was the situation, but we thought that it would show a good "cost/benefit" becasue we would be getting a new truck for a FEMA grant of $75K, and a neighboring department received a $180K grant for a new truck, and runs fewer calls than we do.

My idea from the beginning has been to try the RD route, and ask FEMA for equipment, such as LDH and nozzles. I'd have to think that it would harder to say no to a 10K-15K grant for this purpose.

Thanks again. Any other comments or information is always appreceited.

[tmnkwd]

I would say that if you made it through the computer grading and into peer review, you might not do well there unless you wrote one heck of a narrative pleading your case and were able to back it up with hard data.