U.S. Representatives Zach Nunn (IA-03) and Angie Craig (MN-02) today introduced bipartisan legislation to support rural small businesses. The Rural Microentrepreneur Assistance Act will eliminate barriers within the U.S. Department of Agriculture (USDA) Rural Microentrepreneur Assistance Program (RMAP) to increase support for small businesses receiving loans through the program.

“Small businesses are the backbone of our rural areas, providing needed services and a sense of community that drive the economy,” said Rep. Nunn. “As costs climb for businesses, we need to adapt to ensure additional support to these job creators throughout the areas of Iowa that need it most.”

99 percent of all Iowa businesses are small businesses, employing near half of all working Iowans. In August of 2022, 64.2 percent of small businesses reported finding it challenging to access the capital they need to start a business. Rural small businesses often find it especially difficult to find ample cash flow.

The USDA Rural Microentrepreneur Assistance Program provides loans or grants to small businesses to help with startup and growth. The program also provides training and technical assistance to borrowers and microentrepreneurs. Currently, loans are limited to 75 percent of the project cost up to $50,000. The loans are limited to use for certain start up, expansion, new equipment purchases, or facility improvement costs.

The bipartisan Rural Microentrepreneur Assistance Act will remove those limits to ensure this program fully supports rural small businesses.  Specifically, the bill:

• Provides an inflation adjustment to the maximum loan amount given to a business.
  Allows a RMAP loan to be used for 100 percent of project costs, an increase from the current rate of 75 percent.
  Empowers businesses to use RMAP loans to finance up to 50 percent of real estate construction costs, which is prohibited under current rules.

Rep. Nunn introduced the legislation with three small business owners and the Center for Rural Affairs in Ottumwa, Iowa.