Agriculture and Forestry
Rural Development

Hearing Explores Vital Role of Federal Investments in Rural Communities

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March 10, 2017

Infrastructure, Broadband and Energy

On March 9, the U.S. House Committee on Agriculture, Subcommittee on Rural Development and Energy held a hearing, “The Next Farm Bill: Rural Development & Energy Programs.”  Lawmakers discussed the basic needs of rural communities, including infrastructure, drinking water and broadband, as well as jobs and economic development.

Discussing the role of USDA rural development and energy programs in assisting rural communities, Subcommittee Chairman Austin Scott (R-GA), commented that “rural development initiatives help to offset the high fixed costs of providing basic services like clean water, reliable electricity, and universal phone service… Federal support for infrastructure remains a key part of our commitment to rural America.”

 

The Growing Urban-Rural Jobs Divide

The backdrop to the hearing was the economic situation facing much of rural America. While the United States, on the whole, has recovered from the great recession, rural communities have not yet bounced-back to pre-recession levels of employment. Nearly half of rural counties’ economies have not returned to pre-recession levels.  Meanwhile, urban employment levels are markedly above pre-recession levels, according to data from the USDA and the Bureau of Labor Statistics.

What can help communities bounce back and thrive relative to urban areas?  According to witnesses, providing access to capital through USDA, increasing the availability and speed of broadband, improving local infrastructure and jobs growth through the bioeconomy (renewable fuels and products) are major issues for economic development in rural communities.  Yet, in the 2014 Farm Bill, Rural Development (Title VI), is effectively less than 0.1 percent of total Farm Bill funding ($218 million authorized over 5 years) and the Energy Title is approximately 0.1 percent of total Farm Bill funding ($625 million authorized over 5 years).

 

Infrastructure – Top Line Issue

During the hearing, witnesses continually raised the issue of deteriorating infrastructure. Infrastructure is key in remaining competitive in an ever-increasing global marketplace. Roads and bridges are necessary to move agricultural goods out of agricultural districts, farms and rural businesses require high-speed broadband services.  Yet, according to witness Bob Fox, Chair of the Renville, Minnesota County Board of Commissioners, many rural communities are stuck in a downward spiral of declining tax revenue that hinders their ability to attract businesses and provide critical services to communities.

The news that rural roads, bridges and water infrastructure are in poor shape should come as no surprise.  Just this week, the American Society of Civil Engineers released their annual report card of the nation’s infrastructure – with the nation’s infrastructure (ranging from airports, public transportation, roads, bridges and schools) receiving a D+ overall.

On Thursday, the Farm Credit Council, American Farm Bureau Federation, National Council of Farmer Cooperatives and the National Rural Electric Cooperative Association met with White House and USDA officials to reiterate the critical need for infrastructure investments in rural communities.  In a letter sent to President Trump on February 22, dozens of groups asked the White House to deliver on President Trump’s campaign commitment on infrastructure investments commenting, “Those of us in rural communities have seen our infrastructure deteriorate, jeopardizing jobs, our agricultural competitiveness, and the health of rural families… The scope of the investment need is staggering.”

 

Bioeconomy Remains an Important Piece of Rural Economic Development

While overall a smaller piece of the discussion, the bioeconomy and the Energy Title (Title IX) was also raised. The Energy Title, first authorized in the 2002 Farm Bill, has played a key role in growing rural economies through the development of the U.S. bioeconomy and lowering energy costs for rural communities.  Witness Jim Greenwood, President and CEO of the Biotechnology Innovation Organization, stated that several areas of the Energy Title, including the Biorefinery Assistance Program and the Biomass Crop Assistance Program (BCAP) are key areas for the future growth of the bioeconomy, “to help advanced fuels producers secure the capital necessary to build a biorefinery and assist farmers to grow the feedstocks necessary for these facilities.”

Additionally, Greenwood touched on the Renewable Fuel Standard and the chilling effect that uncertainty around the policy can have, noting that certainty is crucial to maintaining and building investment in sector.

 

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