By DAVID PITT Associated Press
The U.S. Department of Agriculture announced Monday a new $150 million program designed to provide investment capital to help small agriculture-related business in rural areas with cash needed to expand.
Secretary of Agriculture Tom Vilsack announced in Cedar Rapids the formation of the first Rural Business Investment Company, a for-profit firm licensed by the USDA to invest in businesses that otherwise might not have the capital to increase business opportunities.
The USDA traditionally has offered guaranteed loans or direct loans for rural businesses. The creation of the Rural Business Investment Company is a new way for USDA to establish a licensing procedure that makes Farm Credit bank funds available as investment capital. The banks cannot directly hold ownership stakes in companies through capital investment.