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Economic Development Reference Guide
Rural Economic Development
There is no single definition of rural economic development. Typically it
is described in terms of its objectives: these are most commonly described as
the creation of jobs and wealth, and the improvement of the quality of life in
rural areas. Rural economic development can also be described as a process that
influences the growth and restructuring of an economy to enhance the economic
well-being of rural communities. For rural communities, the challenges are very
different from those in urban areas. Small-scale, low-density settlement
patterns make it more costly for rural communities and businesses to provide
critical services.
Rural America is home to one-fifth of the nation's people. It is a place of
natural amenities and national treasures, and safeguard of an important part of
American culture, tradition, and history. Today, rural America comprises more
than 2,300 counties, including 83 percent of the nation's land and 55 million
people. The well-being of America's rural people and places depends upon many
things including:
- The availability of good-paying jobs
- Access to critical services, such as education and health care
- Strong communities
- A healthy natural environment
Trends in Rural Economic Development
- Several recent federal programs and initiatives provide incentives for
private investment in distressed rural areas. These include:
- The Empowerment Zone/Enterprise Community (EZ/EC) program
- Community Development Financial Institutions (CDFI) Fund
- Community Adjustment and Investment Program (CAIP), assisting areas impacted
by the North American Free Trade Agreement (NAFTA)
- EZ/EC programs include
economically depressed rural areas and communities with real opportunities for
growth and revitalization. The aim is to create self-sustaining, long-term
economic development in areas of pervasive poverty, unemployment and general
distress. They also aim to demonstrate how distressed communities can achieve
self-sufficiency through innovative and comprehensive strategic plans developed
and implemented by alliances among private, public and nonprofit entities.
- Programs are helping rural communities finance, construct, enlarge or
improve fire stations, libraries, hospitals and medical clinics, industrial
parks, and other critical community facilities.
- Small Business Investment Companies (SBIC) programs target venture capital
to low- and moderate-income areas. Other small business initiatives such as
BusinessLinc provide new forms of technical assistance.
- Sustainable rural community development are being promoted by the U.S.
Department of Agriculture (USDA).
- The Rural Utilities Service (RUS) agency for rural infrastructure assistance
has helped develop electricity, water and telecommunications infrastructures in
rural communities, by forging public-private partnerships with these companies.
Federal assistance for telecommunications infrastructure funding is also
available through the USDA's telecommunications loan program.
- Emergency agricultural assistance is available to help distressed farmers.
- Cars donated to rural nonprofits are repaired, then loaned, leased, or given
to rural residents who need car access, enabling them to commute to work.
- Fuel vouchers help with the cost of driving to work for rural residents on
low incomes.
- The Grahm-Leach-Bliley Act of 1999 allows banks, securities firms, and
insurance companies to merge, which enables rural consumers to one-stop shop for
a variety of financial services.
- The USDA offers technical assistance and information to help agricultural and
other cooperatives get started and improve the effectiveness of their member
services.
- To help combat the problem of the rural technology gap, distance learning
and universal Internet access in schools and libraries are subsidized.
- Funding for highways and rural airport improvements aim to improve rural
areas' infrastructure.
- Farmers have adopted technology including the use of the latest chemicals
and machinery; however, pressure is put upon farmers to use environmentally
friendly farming practices, and has led to a growth in organic farms.
- The elimination of substandard housing in rural communities is being helped
through programs giving assistance to rural inhabitants to buy, build or rent
decent housing.
Web-based Resources for Rural Economic Development
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