2008 National Extension Farm Bill
Education Conference
Title VI: Rural Development
Dr. Mark A. Edelman,
Professor of Economics; Extension Economist and
Director, Community Vitality Center
Iowa State University
Airport Hilton
Kansas City, Missouri
July 9, 2008
1. Supports Marketing Locally
Produced Agricultural Products
• Locally-produced foods:
– Produced within state or
– Produced < 300 miles
• Priority for Existing Business and Industry Loan
and Loan Guarantee Program.
– Provides up to $250k loan/loan guarantee to
individuals, coops, businesses and other entities to
establish and facilitate enterprises that process,
distribute, aggregate, store, and market locallyproduced ag food products
• Priority for projects that
– serve community development and farm and ranch
income and
– have components serving underserved communities
1. Supports Marketing Locally
Produced Agricultural Products
• Underserved Community: Urban or Rural
community or Indian tribal community with:
– Limited access to affordable health foods in
grocery retail stores or famer to consumer
markets, or a high incidence of diet-related
diseased as compared to national average,
including obesity; and
– A high rate of hunger or food insecurity or a
high poverty rate
2. Reduces Water & Wastewater Loan
& Grant Application Backlog
• Provides $120 million in mandatory
funding for pending qualified applications
already processed by USDA for water and
waste disposal grants and loans.
• Lower interest rates for many water and
waster water loans are made permanent.
3. Expands Broadband Service in Rural
Areas
• Assistance shifted to areas with very
limited or no service.
• To be eligible for assistance:
– No more than 1/4 of population can have
existing broad band service, or
– Service to the area is provided by no more
than one (to three) incumbent broadband
suppliers.
4. Creates Rural Microentrepreneur
Assistance Program
• Loans and grants to Microenterprise
Development Organizations (MDOs) to support
development the development of rural
microenterprises.
– Skills for Startup
– Technical assistance for ongoing success
– Microcredit access
• USDA Rural Microenterprise:
– In rural area
– less than 10 employees
– Less than $50k loan request
4. Creates Rural Microentrepreneur
Assistance Program
• MDO grants (25% local match) to provide training, operational
support, business planning assistance, market development
assistance, and other related services (research in developing best
practices) to rural microenterprises, with emphasis on:
– Low and moderate-income individuals
– In areas that have lost population
• Secretary ensures diversity of MDO recipients by size and service to
racially & ethically diverse populations
• Provides $15 million in mandatory funding for MDO Microloan
Program
– Direct Loans to MDOs for 20 year loans @1% interest with minimum
5% loan loss reserve, and 2 year deferral of repayment.
– MDOs that receive Direct Loans are eligible Technical Assistance
Grants for up to 25% of outstanding Microloan balance. Requires 15%
local match.
5. Authorizes Regional Planning
Authorities
• Reauthorizes Northern Great Plains Regional Authority
(IA, MN, NE, ND & SD)
• Reauthorizes Delta Regional Authority (parts of AL, AR,
IL, KY, LA, MS, MO, TN)
• Creates Southeast Crescent Regional Commission
(parts of VA, NC, SC, GA, AL, MS, FL not already served
by Appalachian or Delta Regional Authorities)
• Creates Southwest Border Regional Commission (parts
of AZ, CA, NM, TX)
• Creates Northern Border Regional Commission (parts of
Maine, NH, NY, VT)
6. Reauthorizes Rural Business
Investment Company (RBIC) Program
• Guarantee of Trust Certificates for RBIC and
RBIC Investors
• Adds eligibility for investment pools created by
banks
• Depentures may be prepaid without penalty
• Distributions may be made to cover tax liability
• USDA fees limited to $500
• USDA will not be required to operate program
with SBA involvement.
7. Authorizes New Rural Collaborative
Investment Program
Purpose: to provide rural regions with
1. Flexible investment vehicle with local control & federal
oversight assistance & accountability.
2. Incentives to develop and implement comprehensive
strategies for achieving regional competitiveness,
innovation, and prosperity.
3. Foster multi-sector community and economic
development collaborations & capacity long term
4. Foster better use and leverage of USDA resources
7. Authorizes New Rural Collaborative
Investment Program
• Creates National Rural Investment Board and National Institute on
Regional Rural Competitiveness and Entrepreneurship
• Develops Strategic Regional Plans for Enhancing Competitiveness and
best practices for establishing benchmarks and measuring progress
• Develops Rural Philanthropic Initiative to enhance permanent
philanthropic resources for rural community and economic development.
• Broad-based Regional Boards (must have local government, nonprofit
community development organizations, ag and natural resource
industries, Indian tribes, regional development organizations, private
business, higher education, workforce and job training organizations,
coops, & others) are certified by National Board.
• Area has > 25k pop, unless density is less than 2/sq mi. then > 10k pop
• Not less than 25% or more than 40% represents govt and Indian tribes,
nonprofit community development orgs and higher ed, or private
business, coops, ag and natural resource businesses.
• Federal or state employees may serve as nonvoting members
7. Authorizes New Rural Collaborative
Investment Program
• Regional Boards: To promote investment, provide financial
and technical assistance, implement approved regional
investment strategies, provide annual reports to Secretary
and National Board, select nonfederal org as fiscal agent.
• Inventory of assets and resources; Assess competitive
advantages of region; Identify goals, challenges, priorities,
plans including organizational tasks, local match resources;
expected outcomes.
• Regional Investment Strategy Development Grant up to
$150k with 60% local match
• Regional Board may receive up to $6 mil in regional
innovation grants to implement strategies after approved
during any 5 year period with 50% local match.
8. Expands Farm Labor Housing
Program.
• Low interest loans or grants for housing
construction and improvement for farm
labor is expanded to assist low income
employees in agricultural processing.
9. Revises Definition of Rural
• Clarifies definition of areas that are not
eligible for USDA rural programs in the
vicinity of cities with more than 50k pop.
• Secretary may broaden the category of
area considered urban to cover areas that
have become urban based on housing
units per square mile through a rule
making process.
For More Information
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http://agriculture.senate.gov/
http://agriculture.house.gov/
http://www.usda.gov/
www.cvcia.org