WASHINGTON, May 1, 2014 – Small towns may lack the population and resources to figure out future plans for growth and economic development. But put a group of leaders from several towns, counties and businesses together for a regional approach at gathering investments, and the odds of success can increase dramatically.
That was one of the main themes discussed during the Senate Agriculture Subcommittee hearing today on “Jobs, Rural Economic Growth and Energy Innovation.”
Chairwoman Heidi Heitkamp, D-N.D., pointed out that she knew a thing or two about growing up in small town America. She hails from Mantador, N.D., a town of less than 100 people, nine of which were Heitkamps.
“In order for small communities like my home town to continue to survive, it’s important that they become more connected to the global marketplace,” she noted. “This requires investments in infrastructure such as high-speed internet and transportation. Equally important, growing small town economies requires careful planning that capitalizes on regional strengths.”
For the first time, the new farm bill targets federal investments for projects that support long-term regional strategies. Several rural experts testified about how regional approaches can work – even though several hurdles remain.
“The first challenge we always have is cultural,” explained Chuck Fluharty, President and CEO of the Rural Policy Research Institute (RUPRI). “Every rural region is very different. In almost all of those where there is success, you have to have buy-in from the start.”
“Rural America sees historic opportunities because of its unique assets. But it also faces historic challenges,” noted USDA Deputy Under Secretary Doug O’Brien. “USDA data indicates that the recent economic recession has resulted in the highest rural poverty rates since the mid-1980’s.
“USDA’s report, “Rural America at a Glance,” points to stalled job growth in non-metro counties, an increase in poverty – particularly among children and a declining population: the first population loss since the federal government began tracking that statistic generations ago.”
But getting people to work together for the greater good of a region – versus an individual town – is “not easy work. It means collaboration, it means time away from other projects,” O’Brien said.
“It’s clear we need some new approaches,” emphasized Sen. Mike Johanns, R-Neb., “By acting regionally, local leaders can do more to promote growth than limiting opportunities to the borders of one town.
Gary Person, the city manager and economic development director for Sydney, Nebraska testified about how his small town was able to overcome the closing of an Army Ammunition Depot and the loss of 2,000 jobs in the 1970’s to grow to a point where there are now 8,000 jobs for a population of 6,500 people.
“When our citizens finally figured out the goose was no longer going to lay another golden egg, the community refused to die like so many of our neighbors,” he noted in his written testimony. “We did it through hard work, one new job at a time, one new business at a time and one challenge overcome at a time. Location of one of the world’s largest outdoor outfitters, Cabela’s, in Sydney, has been a driving force behind the growth.
In addition to the hard work of Sydney’s citizens, Person said they educated themselves on “revitalization programs we could implement and sought out federal and state programs that would give us a “hand up not a hand out.”
But not all of the programs available currently offer the kind of support several rural communities need. For example, Person said his economic development team has been trying to find someone to build affordable workforce housing for about ten years and no developer was willing to take the risk. The first apartment building is finally going up now, but it took a commitment from Cabela’s to finance the project.
Another challenge faced by many rural communities is the increasing cost of government regulation on infrastructure projects. Person said.
“Our small community has had to endure $20 million of new mandated public infrastructure projects primarily brought on by the increased environmental regulations dealing with water, wastewater, landfill, emission standards that closed our power plant. And the list of future issues continues to grow.
“We spent 10 years trying to build a sidewalk, called a public trails system because of such bureaucratic requirements that should embarrass any federal bureaucrat,” he emphasized in his written testimony.
All of the panelists agreed that investments in infrastructure are key to rural development.
“In order to keep a percentage of today’s children in our rural areas, it requires local, state and federal partnership investments in basic necessities …..water, sewer, roads, healthcare, education, utilities, telecommunications... all of which are supported in the 2014 farm bill,” explained Dawn Keeley, executive director, Red River Regional Council in Grafton, ND.
Mark Tilsen, the President and Co-Founder of Native American Natural Foods, shared his frustrations with finding financing, especially for housing and training. He and his partner created the Tonka Bar, the first protein bar made with real buffalo meat and fruit, and the firm experienced more than 135 percent growth in 2014 – employing nine full-time jobs on the reservation.
But first. he went to 11 different banks in an effort to seek financing and found none interested.
“Most of banks do not provide funding on reservations without a federal guarantee. Yet the federal government doesn’t consider brand equity as an asset,” he explained. As a result, his firm was unable to get the type of federal loan guarantees to secure financing from a commercial bank. Eventually, his firm received help from the Lakota Fund and other Native American entities to get started.
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