By Ed Elfmann
As a banker working in rural America, you surely know a small town or two that seems to be dwindling away—if it’s not in your county, then maybe in the next county over. For many years, the population has been shifting from rural areas to urban and suburban areas. This movement is changing the markets for ag and rural banks.
A concern for economic development in rural counties and how we can rebuild our small towns was the predominant thread in discussions at the advisory board meeting I attended earlier this month in planning for the 2020 ABA Agricultural Bankers Conference.
What can bankers do to help? Are there opportunities to leverage with this demographic shift?
You can start by looking through the various programs offered by the USDA within Rural Development. Offerings encompass three project areas:
- Affordable and Safe Housing, including the Rural Housing Service, which invests in housing units for those living outside of urban centers. Both direct and guaranteed loan programs are available for lenders to use to work with customers. Another program within this division is the Community Facilities Programs. These loans can be used for everything from a town hall to fire trucks.
- Economic Development and Business Support, including the Rural Business-Cooperative Service and Rural Energy for America programs. These programs provide guaranteed loan programs that can be used for a variety of purposes.
- Infrastructure Investment, including the Rural Utility Service. RUS provides a pathway for guaranteed loans that can be used for rural broadband.
USDA is working to make its Rural Development programs more banker friendly. Last year, ABA submitted comments on how to make the programs a better resource for bankers, and USDA is currently working through those proposals. Additionally, the budget submitted by the Trump administration has more funding for Rural Development programs, which shows the emphasis that is being put on revitalizing rural America.
Small Business Administration loans provide another opportunity for rural economic development. SBA approved banks will find financing and government programs that can help new and existing agricultural businesses start, expand, obtain financing, and comply with laws and regulations.
I also invite you to join your state bankers association on its Washington Visit, to address your representatives in person, and use ABA’s Secure American Opportunity page to participate in grassroots efforts that will benefit rural community revitalization.
Another way to be heard is to contact the Interagency Task Force on Agriculture and Rural Prosperity, created in 2017 to promote agriculture, rural economic development, infrastructure improvements, food safety, energy security, and more. No one feels the effects of harmful and unproductive regulations like the individuals living in rural communities. If there’s a regulation that doesn’t work for you—here is another opportunity to speak up.
We need to invest the in redevelopment of agricultural communities and rural America. Agricultural and rural banks are key to the success of our rural communities. I encourage bankers to not only reach out to their state and local USDA Rural Development offices to learn what programs they have that will be beneficial, but to also come to Washington and let folks on the Hill know what you need.
