USDA offers grants for struggling rural communities

PALMER -- The USDA Rural Utilities Service is seeking applicants for $11.3 million in grant funds to assist communities experiencing high energy costs.

"These are competitive grants, and are available to communities experiencing extremely high energy costs," said Alaska RUS Field Representative Allan Yost. "Grant funds can be used to acquire, construct, extend, upgrade or otherwise improve energy transmission, generation or distribution facilities," Yost said. The criteria set by RUS require rural communities to have a per capita energy cost to residents of at least 275 percent of the national per capita energy cost.

Much of rural Alaska meets these criteria. Cities such as McGrath, owing to their remoteness and outdated technology, can experience energy costs of four to five times the national average. These high costs are aggravated by the low income bracket of many rural residents, who may earn less than 50 percent as much as Alaskans in more urban areas.

The Rural Utilities Service is a government organization that helps rural power, water and heat services expand and work more efficiently. Each year millions of dollars are spent by the RUS to improve the quality of life in small communities across the United States. Since these communities often have limited access, self-sustaining power plants and other environmentally-based generators are popular choices for grant applications.

The maximum grant amount stipulated by the RUS is $5 million, and the minimum is $75,000.

In 2003, the RUS provided more than $300,000 to the city of Atka for a new hydroelectric plant, $465,000 to McGrath Light and Power to upgrade and retrofit the existing McGrath power plant, and $2.5 million to the Alaska Village Electric Cooperative for power plant upgrades and the construction of a wind-based electricity gathering system.

Eligible applicants include legally organized profit and nonprofit organizations, including corporations, sole proprietorships, states, political subdivisions, and other entities organized under state law, federally recognized tribes and tribal entities.

For more information, call Karen Larsen with the RUS in Washington, D.C., at (202) 720-9545 or Allan Yost in Anchorage at (907) 345-8446. Online application information can also be found at http://www.usda.gov/rus/electric/.

Communities and organizations seeking to apply for one of these grants should postmark their applications by March 5.