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Putting Revenue Sharing Back on the Table

Rural Definitions: You’re O-U-T!

by CAROL MILLER

The squabble over how to define rural diverts us from the real problem: Support for vital rural development programs has been decimated. Maybe it’s time for a new take on an old idea.

The emerging fight in Washington over how to define “rural” for some federal programs is distracting us from the real issue: Federal support of our rural communities is inadequate,
ineffective and needs to change

I have spent nearly 30 years working on rural and frontier definitions, responding to Federal Register rule-making, executive and congressional initiatives. I’ve worked at all levels
professionally to personally – from the White House to my extremely under-resourced home community of 300 in frontier New Mexico.

Government keeps us so tied up in the busy work of defining who’s in and out of rural programs there is never time to get to the heart of definition madness. It’s time to demand to know why we
are spending our time defining rural, and why we are doing it now.

The economic collapse and so-called “austerity” have left rural America reeling. Everybody and his brother have conducted studies and reported the tragic, intentional, immoral rural poverty data ad nauseum.

Everyone needs help, including urban and exurban America. The whole country is being neglected and destroyed by “austerity” cuts. But, since my expertise is the 85% of the country’s land area that is not urban, I am going to stick to what I know.

Each federal definition has programmatic impacts. Over the years, I have even helped add definitions as programs were created or reauthorized, trying to make sure that the funds would ultimately reach the communities and regions in need. Most definition madness is related to “categorical” funding, grants that must go to specific programs or projects and are much harder to allocate for local needs. We never get to address the fact that categorical funding rarely aggregates into enough support to create a thriving community.

The central problem is that the federal government is not stepping in to help as it did in the 1960’s and 70’s, when rural poverty was considered a national shame. Although the economic opportunity programs created to improve rural communities never completely succeeded, even crumbs were better than nothing. We seem to be at a new point where rural decline is expanding beyond the persistent poverty areas that have historically fared poorly.

It is not an accident that rural poverty maps stay the same decade after decade. They stay the same because policies and funding decisions keep the same places poor. It is not an accident that declines in life expectancy are highest among rural women of all races; it takes policies to steal the very life from rural communities.

Despite USDA cuts to rural development of 30% and staff reductions of 18% (the loss of more than 1,000 people), USDA Secretary Vilsak reacted mildly to the President’s 2014 budget proposal. Since 2010 the USDA operating budget dropped by $3 billion, or 12 percent. Nevertheless, USDA stated in a report that “discretionary savings are achieved through ongoing efforts to streamline operations, reduce costs, and close offices, and these savings are redirected into critical activities in recognition of tighter budget constraints.”

Closed offices and lack of staff are actually a big deal in communities that are located far from the nearest USDA office and have no public transportation and limited access to the Internet. Where there used to be county offices and people knowledgeable about local conditions, there are now distant regional offices with fewer staff trying to handle more work.

With all of this shrinkage going on, no wonder rural people are concerned about the effects of changing the definitions of rural. It is already hard enough to compete for scarce funds.

Revenue Sharing: Has Its Time Come Again?
A number of years ago, I was feeling hopeless about increasing rural poverty rates. During a one-on-one meeting at USDA with Calvin Beale, the longtime rural scholar and sorely-missed rural policy guru, I asked if there was any program he could point to in his 60-plus years as a federal employee that actually worked. Without a moment’s hesitation he said, yes, revenue sharing.

That comment from Calvin sent me to the archives to learn about the federal revenue sharing program. It convinced me it is time for us in the rural policy arena to discuss bringing back
revenue sharing. We know the good points as well as the bad points and can fight to see that Revenue Sharing 2.0 is even better than the original.

Revenue sharing was a Republican program that became well liked across the partisan divides. It emerged at a time when the federal government gave more funding control to state, local and tribal governments. Revenue sharing was a Nixon proposal passed in 1972 and it lasted for 15 years.

President Ford reconfirmed the benefits of revenue sharing in his 1976 State of the Union, stating: “This program has been effective with decision making transferred from the Federal government to locally elected officials. Congress must act this year or state and local government will have to drop programs or raise local taxes.”

Congress listened to Ford, and the success of revenue sharing grew until was giving general purpose funds to 38,000 cities, towns, counties, townships, tribes and Alaska native villages.
Despite its popularity and cost effectiveness, the pendulum swung and at the peak of its success in 1987, revenue sharing was repealed.

The current rural development system is not working. Maybe we need a combination of revenue sharing with categorical grant, loan and loan guarantee programs. But let’s put revenue sharing
back on the table as we try to improve the lives of rural people and create stronger rural communities.

Carol Miller is a community organizer from Ojo Sarco, New Mexico (population 300) and an advocate for “geographic democracy,” the belief that the United States must guarantee equal
rights and opportunities to participate in the national life, no matter where someone lives.