For Release Only by the Senate Committee on Agriculture

Statement of Jill Long Thompson, Under Secretary for Rural Development, United States Department of Agriculture before the Senate Committee on Agriculture, Nutrition, and Forestry, Subcommittee on Forestry, Conservation, and Rural Revitalization, Concerning the National Rural Development Partnership

Mr. Chairman, Members of the Committee, thank you for inviting me to appear before the Committee today to discuss the National Rural Development Partnership and the State Rural Development Councils.

The National Rural Development Partnership began as an initiative of President Bush in 1990 through the issuance of Executive Order 12720. The U.S. Department of Agriculture was assigned the responsibility of creating the Partnership and providing assistance to individual States that wished to form State Rural Development Councils. The intent was to provide a forum at the national and state level of all public and private organizations to address local rural community and economic development problems and use resources more effectively in the resolution of those problems.

In 1990 eight states were selected to put the State Rural Development Council pilot project in place, Kansas, Maine, Mississippi, Oregon, South Carolina, South Dakota, Texas, and Washington. These Councils were composed of federal, state and local government representatives, tribal governments, and for profit and non-profit private organizations. The Councils structured themselves according to local needs. Today, there are 36 state rural development councils, and more states are considering establishing Councils. The state councils are supported at the national level by the National Rural Development Partnership which is composed of federal agencies and non-governmental organizations. USDA provides policy and administrative support.

Funding for the Councils has always been voluntary with USDA providing the majority of the funds. The Departments of Labor, Transportation, Veterans, and Health and Human Services have been consistent contributors and other Departments and agencies have contributed less frequently. The vast majority of the federal funds goes directly to the 36 State Councils and each state council is required to provide at least 25% of the total budget from non-federal sources. The non-federal share comes primarily from state governments, although, in some states, private sector funds are used for a portion of the required match.

Mr. Chairman, while the effort to improve the coordination of development activities in rural areas is definitely worthwhile, the lack of consistency in funding and the lack of legislative foundation providing policy guidance and direction has been problematic from the very beginning of this initiative. Everyone involved is required to spend far too much time securing funding and that effort dilutes the efforts to accomplish the original objective of improving the utilization of financial and other resources. Nevertheless, there have been successes. For example.

• The Illinois Rural Development Council in 1997 spearheaded the development of a statewide strategic plan for rural Illinois. The plan cuts across all sectors, including transportation, health care, education and housing and was developed through extensive citizen participation. Federal and State agencies are using the plan to implement their programs in rural areas.



• The Iowa Rural Development Council, including the USDA Rural Development Office in Iowa, the Economic Development Administration, and the Small Business Administration and others developed and are implementing a strategy to build home-based industries.



• The Nebraska Rural Development Council has focused on providing technical assistance for 12 cooperative projects, including the Nebraska Edible Bean Marketing Cooperative.



• Other councils have provided assistance to communities in establishing revolving loan funds for community and economic development, developing training programs for new elected municipal officials, and providing senior citizens computer training to enable them to enhance their incomes.

The original purpose of the Councils was to provide an environment through which differences in Federal, State and local statutes and regulations could be discussed and resolved so that those differences becoming impediments to development. Some Councils have been able to accomplish that on specific projects and others have been involved in assisting States and local governments develop specific projects like microenterprise lending funds. But, the key attribute is that the agendas are developed to meet diverse needs; they are not driven from Washington.

One of our Rural Development State Directors has stated "Our State Rural Development Council is the best vehicle I know for communication and coordination of efforts among the many government organizations who have responsibilities for improving conditions in rural areas." Heads of State cabinet departments and key Federal executives working within the state pool their resources to address issues such as funding for water and sewer projects, health and education programs, and rural telecommunications. The result is a more coordinated approach and more effective use of resources.

I am convinced the state Councils can make a real difference in rural America. However, we need to revisit the original approach to funding and participation at the Federal level, if we expect the Councils to carry out the original mandate of the Executive Order and if we expect to have Councils formed in each state. There has to be some legislative foundation and funding needs to be consistent.

Mr. Chairman, this concludes my remarks and I would be happy to address any questions you might have. Thank you again for the opportunity to appear before the Committee.