Federated Rural Electric assists City of Okabena with loan
Money to be used to purchase payloader for street and maintenance work.
OKABENA — Federated Rural Electric, Jackson, assisted the City of Okabena with a $75,000 loan from the co-op’s Revolving Loan Fund. The City of Okabena will buy a payloader for street and maintenance work. In addition, Okabena plans to build a shop and storage building.
Federated and the city of Okabena signed the 10-year loan paperwork on July 19. As funds are repaid, they can be loaned to other organizations. This is the second time Okabena has used Federated’s Revolving Loan fund.
“Federated initially applied for the zero-interest loan and then charges up to 1% handling to the organizations,” stated Scott Reimer, Federated’s general manager. “As these organizations pay back their loans, this money goes into a revolving loan fund to assist other organizations for economic development or community facilities.”
The recipient also pays for the loan’s closing costs and 1% interest.
Since 1992, Federated Rural Electric has provided $3.8 million in economic development dollars. Its revolving loan started in 2009 with a United States Department of Agriculture (USDA) loan for $244,000 that financed a Ceylon fire truck and Tenhassen Township Hall. In 2016, Federated secured additional USDA revolving loan funds and added a matching 20% totaling $421,515 toward new Heron Lake and Round Lake fire trucks. Since then, Okabena has used the revolving loan funds for its fire department brush fire truck.