Finding funding for capital projects is a major concern for many rural healthcare facilities. Capital funding is defined as funding used to expand or renovate a building, purchase major equipment or construct a new facility for a rural health provider. In searching for funding for capital projects, it is very important that facilities consider and use a variety of potential sources, including public grants and loan programs, as well as private sources such as foundations and donations from local residents.
Related Guides
Frequently Asked Questions
Funding
BPHC Loan Guarantee Program
Loan program to Section 330 health centers to obtain a loan guarantee for the financing of a medical facility construction, renovation and modernization.
Calvert Foundation Loan Program
Loans to community organizations that act as financial intermediaries, including loan funds, microfinance institutions, affordable housing developers and social enterprises.
Charles A. Frueauff Foundation Grants
Awards grants in the areas of higher education, social services, health and hospitals.
Community Development Transportation Lending Services (CDTLS, the Fund)
Provides loan funding to support transit services in rural areas.
Community Impact Grants Program
Funding for nonprofit organizations, public schools, and public service agencies in the United States that are using the power of volunteers to improve the physical health of their communities.
Federal Surplus Personal Property Donation Program
Enables certain nonfederal organizations to obtain property that the federal government no longer needs.
First Children's Finance Loan Fund
Loans and technical assistance to child care and early education businesses, especially those serving lower-income communities.
HUD 242 (FHA Section 242) - Helping Hospitals Get Capital Financing
Loan program to help hospitals finance new construction, refinancing, and modernization or to purchase major movable equipment such as hospital beds, wheeled equipment, and office machines.
HUD State Community Development Block Grant (CDBG) Program
Funding for revitalizing neighborhoods, expanding housing, improving community facilities and services, acquiring property such as land and buildings, and improvements to property.
Kresge Capital Challenge Grant Program
Grants designed to fund an organization's immediate capital needs and to build its capacity to raise private support for the future.
Kroger Company Foundation
Grants are made to feed the hungry, support breast cancer initiatives, provide disaster relief, and assist local grassroots organizations.
Otto Bremer Foundation Grants
Funding to help build healthy, vibrant communities.
Rural Broadband Access Loan and Loan Guarantee Program
This program furnishes loans and loan guarantees to provide funds for the costs of construction, improvement, or acquisition of facilities and equipment needed to provide service at the broadband lending speed in eligible rural areas.
Rural Business Enterprise Grant (RBEG)
Provides grants for the development of small and emerging rural businesses, distance learning networks, and employment related adult education programs.
Rural Community Assistance Corporation Community Facility Loans
Loans to help create and improve essential community facilities in the rural West.
Rural Economic Development Loan and Grant Program (REDLG)
Loans and grants are to assist in economically developing rural areas.
SBA Certified Development Company (504) Loan Program
Provides growing businesses with long-term, fixed-rate financing for major fixed assets, such as land and buildings.
Section 108 Loan Guarantee Program
Funding that provides communities with a source of financing for economic development, housing rehabilitation, public facilities, and large-scale physical development projects.
Small Business Investment Company (SBIC) Program
A program to provide financial assistance to small businesses in need of growth capital.
Surplus Real Property Available for Public Use
Disposal of surplus real property by lease, permits, sale, exchange, or donation.
USDA Community Facilities Loan and Grant Program
Funding to construct, enlarge, or improve essential community facilities for health care, public safety, and public services in rural areas.
Inactive Funding
Inactive Funding Opportunities -
Lists additional funding programs for this topic that are not currently accepting applications. Programs that are inactive may be offered again in the future.
Regulations, Forms & Other Useful Documents
Access Capital: New Opportunities for Meeting America's Primary Care Infrastructure Needs
Sponsoring organization: National Association of Community Health Centers
Examines why significant investments in health center infrastructure are critical to meeting rising numbers of medically underserved and uninsured people.
Date: 03 / 2008
Critical Access Hospital Replacement Process: The Manual
Sponsoring organization: U.S. Department of Health and Human Services
Describes the facility replacement process, including the phases, actions, and involved parties that are needed. Offers guidance on the facility replacement process, including assessing the CAH’s physical and financial situation, gaining community support, identifying and obtaining financing, working with lenders and Federal enhancement programs, and completing the design and construction process.
Date: 10 / 2010
Critical Access Hospital Replacement Process: The Roadmap
Sponsoring organization: U.S. Department of Health and Human Services
Provides a visual overview of the entire facility replacement process. Divided into four phases including Planning, Design and Financing, Endorsement, and Construction. Each phase is further described by events, actions, duration, costs/fees, and involved parties.
Date: 10 / 2010
Focus on Funding: Capital Improvements
Author(s): Beth Blevins
Sponsoring organization: Rural Assistance Center
Brief overview of capital funding for health care facilities. Includes case studies of recent capital funding projects.
Journal citation: Rural Monitor Volume 2007 Issue Spring
Date: 2007
Focus on Healthcare Finance White Paper II: Financing Options for Nonprofit Small and Rural Hospitals
Author(s): Matthew J. Lindsay, Gerald M. Swiacki
Sponsoring organization: Lancaster Pollard
Outlines several programs and financial options available to non-profit community and rural hospitals. Discusses a hospital's strategic plan for future and financial operations.
Date: 2011
Guidelines for Design and Construction of Health Care Facilities
Sponsoring organization: American Institute of Architects
Intended for architects, engineers, and health care professionals who are planning new or renovated health care facility construction. Authorities in 42 states, the Joint Commission for the Accreditation of Healthcare Organizations, and several federal agencies use the Guidelines as a reference, code, or standard when reviewing construction designs and plans and completed healthcare facilities.
Date: 2010
Organizations
Capital Link
Nonprofit/Foundation
Provides advisory services related to planning and financing capital projects for nonprofit community health centers to support and expand community-based health care.
Economic Development Administration (EDA)
Federal government
Works to generate jobs, retain existing jobs, and stimulate industrial and commercial growth in economically-distressed rural and urban areas of the United States. Part of the U.S. Department of Commerce. Offers funding in areas such as capital improvements and disaster relief.
Federal Home Loan Banks (FHLB)
National organization
Represents all 50 states, with each state part of a regional FHLB. Offers low-cost funds to financial institutions for home mortgages, small businesses, and rural and agricultural loans, including the Community Investment Program with subsidized interest rates.
Foundation Center
Nonprofit/Foundation
Collects, organizes, and communicates information on U.S. philanthropy. Provides free and fee-based information on grantseeking and foundation giving.
National Association of Health and Educational Facilities Finance Authorities (NAHEFFA)
National organization
Provides assistance and support to its member higher education authorities through education, communication, advocacy and leadership development so its members can better serve their varied constituents.
Opportunity Finance Network
National organization
Consists of a national membership organization of community development financial institutions (CDFIs) which provides capital, technical assistance, and development services to support the revitalization of economically-disadvantaged urban, rural, and reservation-based communities across the United States.
Small Business Investment Company (SBIC)
Federal government
Works to aid, counsel, assist, and protect the interests of small business concerns.
USDA Housing and Community Facilities Programs
Federal government
Helps rural communities and individuals by providing loans and grants for housing and community facilities.
Terms & Acronyms
Application Procedures Set of instructions issued by funders, listing the necessary steps for proposal review. These include submission deadlines, letter of intent, contact person and mail address. These vary among the different funding organizations.
Block Grants Grants administered by the federal government to provide states with funding for a particular purpose, for example the delivery of maternal and child health services.
Capital Campaign A campaign, usually extending over a period of years, to raise substantial funds for enduring purposes, such as building or endowments funds.
Community Development Financial Institutions (CDFI) Financial institutions that awards money to community-based organizations that work in low-income urban and rural communities across America.
Community Foundations Private funding from foundations involved in grant giving within a specific community, state or region.
Community Groups Local organizations which focus on supporting projects within their communities, for example churches, junior leagues, and civic associations.
Contract A binding agreement used to procure specified services.
Cooperative Agreement An agreement between a funding agency and grantee which allows the funder some control. These are often used by the government to conduct extramural clinical trials.
Corporate Foundations Private funding from foundations which receive contributions from a profit-making entity, for example a specific corporation.
Debt Reduction Also known as deficit financing. A grant to reduce the recipient organization's indebtedness; frequently refers to mortgage payments.
Demonstration Grants Grants administered by the federal government to demonstrate or establish the feasibility of a particular theory or approach, for example rural health outreach, network development, and telemedicine grant programs.
Department of Health and Human Services (DHHS) The United States government's principal and largest grant-making agency, including more than 300 programs. Often referred to as HHS.
Direct Giving Foundations Private funding from foundations which are usually corporations that donate goods and services for charitable causes, for example IBM Corporation.
Economic Development Administration (EDA) The U.S. Department of Commerce's Economic Development Administration provides grants for infrastructure development, local capacity building, and business development to help communities alleviate conditions of substantial and persistent unemployment and underemployment in economically distressed areas and regions.
Emergency Funds A one-time grant to cover immediate short-term funding needs on an emergency basis.
Form 990-PF The information statement submitted by foundations which outlines their assets and annual giving. This form is submitted to the State Attorney General's office and is made available for public review.
Formula Grants Grants administered by the federal government to provide funding to specified grantees on the basis of a specific formula, using indicators, for example per capita income, mortality or morbidity rates, outlined in legislation or regulations such as certain substance abuse programs.
General Operating Support A grant made to further the general purpose or work of an organization, rather than for a specific purpose or project; also called unrestricted grants.
Grant Need-based financial aid that does not have to be repaid. May be offered by the Federal or state government, college or private foundation.
Grantsmanship The process of identifying funding needs and the steps in obtaining those funds.
In-Kind Support Nonmonetary contributions made by the grantee such as equipment, supplies, services, or technical expertise.
Letter of Intent/Inquiry The initial contact or letter with a funder outlining the proposed project or plan.
Loan Money lent for a specified period of time at a specific interest rate. Collateral is often necessary to receive the loan.
Loan Guarantee Loans provided to small businesses unable to secure financing on reasonable terms through normal lending channels. Should the borrower default on the loan, then the agency would pay the private financier for the loan.
Matching Funds Money which "matches" the funder's contribution. This money can come from a third party or the grantee.
Office of Grants Management (OGM) Part of the Department of Health and Human Services.
Private Foundations Private funding from foundations which receive income from an individual, family or group of individuals. The funding priorities of private foundations are usually based on the personal philosophies of the founding members.
Program Development Grants to support specific projects or programs as opposed to general purpose grants.
Program Officer The representative of the funding agency who is responsible for the grant's administration.
Project Grants Grants administered by the federal government to support individual projects in accordance with legislation that gives the funding agency discretion in selecting the project, grantee, and the amount of award, for example Area Health Education Centers - Model Programs.
Proposal Written plan submitted to potential funders. This contains the program's goals, objectives, methods, budget, and evaluation.
Renovation Defined by HUD as rehabilitation that involves costs of 75 percent or less of the value of the building before rehabilitation.
Request for Application (RFA) Announcement inviting proposals for a specified contract in support of a particular project or service.
Request for Proposal (RFP) Announcement inviting proposals for a specified type of grant.
Research Grants Grants administered by the federal government to support investigation aimed at the discovery of facts, health services research, clinical trials, revision of accepted theories, or applications of new or revised theories. Research grants for individuals are usually referred to as fellowships.
Seed Money A grant or contribution used to start a new project or organization. Seed grants may cover salaries and other operating expenses of a new project. Also known as "start-up-funds."
Solicited Proposal A grantseeker's response to a request for a proposal issued by a funding organization.
Technical Assistance Operational or management assistance given to nonprofit organizations; may include fund-raising assistance, budgeting and financial planning, program planning, legal advice, marketing, and other aids to management. Assistance may be offered directly by a foundation staff member or in the form of a grant to pay for the services of an outside consultant.
Unsolicited Proposal A proposal which originates from the grantseeking organization. Some organizations do not allow unsolicited proposals.
Voluntary Agencies Private organizations which support charitable programs that are consistent with their overall mission, for example the Red Cross.
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