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IN THIS ISSUE:
Feature Article:
Listening to Nebraska: the Results of the Listening Sessions
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Small Business Tax Credit
This year’s tax bill eliminates the small
business tax credit, but future prospects are good
The tax bill that passed the U.S. Congress last month did not include the Rural Small Business Tax Credit the Center has championed.
That provision would provide a 30 percent investment tax credit for micro enterprises in rural counties that have lost at least 10 percent of their population over 20 years. It was drawn from the New Homestead Act and included in the Senate version of the JOBS tax bill. But in the end, the House Ways and Means Committee leadership defeated it.
But there is hope for the future. Senators Byron Dorgan, Chuck Hagel, and other cosponsors will reintroduce the New Homestead Act next year and push to gain at least 20 Senate cosponsors.
The Rural Small Business Tax Credit and other rural development incentives should be back on the agenda of the Senate Finance Committee, where they have been embraced by Republican Committee Chair Chuck Grassley and top-ranking Democrat Max Baucus. |
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>> The Center for Rural Affairs will soon unveil the
Rural Action Brief. The new publication will be a quarterly, and will be distributed to organizations, individuals, local elected officials, and news media across the nation interested in federal rural policy.
The brief will analyze Executive and Congressional budget actions affecting rural development and community development. We will also analyze how rural development and community development programs are implemented administratively.
To obtain a free subscription to the Rural Action Brief, please email Jon Bailey at
jonb@cfra.org or Marie Powell at mariep@cfra.org
>> A new book, Women and Sustainable Agriculture: Interviews with 14 Agents of Change by Anna Anderson profiles14 women who
have worked for change to sustainable methods of production and distribution in the food system.
Sarah Vogel, Cornelia Flora, Pat Richardson, Dana Jackson, Lynn Coody, and the Center’s senior policy analyst Kim Leval, among others share their views on
a variety of subjects.
The book will be available later this fall for $35; order online at www.mcfarlandpub.com
– follow the Interdisciplinary Studies/Women’s Studies link. Contact author Anna Anderson at
ecosustainablity@yahoo.com
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Conservation Security Program Funds Cut to Provide
Drought Aid
Drought disaster assistance to come from $2.9 billion reduction in the CSP; hurricane assistance to come from emergency funding
Before heading home for the final weeks of campaign events, Congress attached disaster assistance to the Homeland Security spending bill for those struck by hurricanes and drought.
The most pressing issue was whether drought assistance funding – unlike hurricane assistance – would have to be paid for by cutting funding for other farm bill programs.
Once again, the House Republican leadership aggressively pursued a route that treated the Conservation Security Program (CSP) as their slush fund. They blocked Representative Charlie Stenholm (D-TX) from introducing and getting a vote on a disaster assistance package that closely matched the Senate’s version.
That version treated both forms of disaster assistance equally by paying for them with emergency funding. The House, with the support of the Administration, ended up passing hurricane and drought disaster assistance with the funding for drought assistance being carved out of the
CSP.
The House and Senate then met in conference to hammer out the differences between the two bills, with the biggest difference being how to pay for drought assistance. This issue was not easily resolved as a number of senators objected to capping the
CSP.
In the end, the CSP was cut by $2.9 billion to pay for drought assistance. However, Senator Tom Harkin garnered an agreement with the Senate leadership stating they will restore the cut to the CSP when Congress reconvenes in November. This resolution agreement passed 71-14, demonstrating broad support for
CSP.
We understand the short-term necessity of providing drought assistance to those farmers and ranchers severely impacted by such conditions. But cutting the CSP to pay for such assistance is purely bad policy.
The CSP rewards farmers and ranchers for their conservation efforts, including those that help them mitigate drought. Drought assistance should be on equal footing with hurricane assistance, paid for through emergency funding.
When Congress reconvenes this month, we need to be sure they hear the message loud and clear: CSP has broad, far-reaching support, and we expect them to restore funding.
Contact: Traci Bruckner, tracib@cfra.org
for more information.
Center Hosts National Meeting Focused on Small Business Support
Folks came from six states to see how rural small business development programs link to effective local, state, and national
policy
The Center for Rural Affairs recently played host to the Association for Enterprise Opportunity (AEO) Rural Policy Learning Cluster. The group met October 5-8 in Omaha, Lincoln, and Nebraska City, Neb. The AEO Rural Policy Learning Cluster consists of representatives from organizations in six states exploring rural policy issues and microenterprise development.
Jon Bailey is the Center’s representative to the AEO Rural Policy Learning Cluster. Other Learning Cluster representatives are from Iowa, Texas, Vermont, California, and Ohio.
Learning Cluster members and AEO staff visited and lunched with the Nebraska City REAP association and learned how local entrepreneurs who are REAP members become involved in issues of local, state, and federal policy. Learning Cluster members and AEO staff also learned how state and federal microenterprise public policy directly assists entrepreneurs such as those in Nebraska City.
REAP is the Rural Enterprise Assistance Project, the microenterprise development program of the Center. Entrepreneurs and small businesses may form local associations for networking, training, and loan programs offered by REAP.
Learning Cluster members and AEO staff next traveled to the State Capitol in Lincoln and heard from a panel on microenterprise issues in Nebraska and how organizations and the grassroots can influence public policy.
Panel members included REAP Director Jeff Reynolds, Nebraska Microenterprise Partnership Fund Director Rose Jaspersen, Legislative Aide Julia Holmquist, lobbyist Rich Lombardi, and NEON chair Maryanne Rouse (NEON is the trade association of Nebraska microenterprise organizations).
The Center recently published Big Jobs in Small
Businesses: Microenterprise Employment in Nebraska, an examination of employment in all counties in businesses with five or fewer employees (the standard definition of
microenterprise).
We found that rural counties in Nebraska have nearly 30 percent of their total private, non-farm employment from microenterprises, nearly twice the national average. This illustrates the need for good, effective public policy to promote and develop this type of economic development in rural communities across the nation.
Contact: Jon Bailey, jonb@cfra.org
You can find more information on REAP at www.cfra.org/reap
You can learn more about the Association of Enterprise Opportunity (AEO) at www.microenterpriseworks.org
Looking at the Big Picture: Home Town Competitiveness Program
Four pillars support long-term sustainable strategies for communities to adopt, using an “inside out” approach that works for them
In exploring different community development processes going on all over the country, it is apparent that the most successful efforts are locally driven. One of the most sought after development processes is a fresh effort called Home Town Competitiveness
(HTC).
HTC is a comprehensive approach to long-term rural community sustainability. The Center’s Project HOPE, which worked in 12 different communities in northeast Nebraska, is very similar. The biggest difference between the two is that HTC includes wealth transfer and using foundations as a vehicle for a major part of its program.
The Home Town Competitiveness process was the creation of three organizations that banded together to offer their expertise in this model. They are the Heartland Center for Leadership Development, the Nebraska Community Foundation, and the Center for Rural Entrepreneurship. They worked to design a solid model that uses four pillars to achieve long-term strategies for communities to adopt and pursue. Those four strategies are: Entrepreneurship, Charitable Assets, Youth, and Leadership.
The design of the program is to look at the rural community and decide whether to use one, two, three, or all of the strategies in working with the community. An important aspect of the HTC process that mirrors several other efforts across the country, including the Center’s project HOPE, is that it needs to be driven locally and that development must come from the “inside out.”
HTC helps the community to focus on the following four interrelated strategies that depend on each other for ultimate success. They are:
- Building skilled and inclusive leadership in the community.
- Retaining and attracting youth and young families that are involved in community leadership.
- Acting NOW to capture a portion of the wealth that will transfer between generations.
- Using that transferred wealth in an entrepreneurial way to build local business and create jobs.
For more information on HTC, contact Jeff Yost at the Nebraska Community Foundation, 402.323.7330.
Contact: Michael L. Holton, michaellh@cfra.org
for more information on community revitalization.
Iowa Farmland Ownership Trends
Less farmland is owned by young farmers and farm operators in Iowa today than in 1982, according to a recent analysis by Iowa State University Economist Mike Duffy published in the
Leopold Letter.
- The share of land owned by people over the age of 65 increased from 29 percent in 1982 to 48 percent in 2002.
- The percentage of farmland owned by someone who does not live on a farm increased from 37 percent to 45 percent.
- Nineteen percent of Iowa farmland is owned by people who don’t even live in Iowa, up from six percent.
- Rented land increased from 43 percent of all land to 59 percent.
- Cash rental arrangements increased from about half of rented land to more than two-thirds.
Duffy says more cash rents will make it harder for young farmers to get started. And with more land owned by non Iowans, more farm program benefits will leave the state.
Under the current farm program, payments are tied to land. The more land you control, the greater the payment. As a result, virtually all of the benefits are captured by landowners, including landlords who receive higher rental payments. With farm operators owning less than half the land, they get less than half the benefit from farm programs.
To correct that, Congress should place strict limitations on payments to prevent large, aggressively expanding operations from bidding up cash rents. It should move toward greater reliance on payments that aren’t based on how much land a farmer controls, such as the Conservation Security Program, which bases payments on environmental management.
Contact: Chuck Hassebrook. chuckh@cfra.org
for more information.
Corporate Farming Notes
Supreme Court to hear checkoff case; Smithfield porks up by acquiring competition
>> The Supreme Court will hear oral arguments on the mandatory beef checkoff program – a mandatory one dollar fee on the sale of every head of cattle – on December 8, 2004.
The Court will likely issue a decision sometime early next year. Attorneys for the Western Organization of Resource Councils (WORC) and the Livestock Marketing Association (LMA) filed their brief on Friday, October 15, 2004.
In December 2000, WORC and LMA sued the U.S. Department of Agriculture (USDA) to gain a vote of cattle producers on the checkoff. The case was amended in August 2001 after the Supreme Court ended the mushroom
checkoff.
In June 2002, U.S. District Judge Charles Kornmann ruled the beef checkoff violated cattle producers’ First Amendment rights by compelling them to pay for speech with which they disagreed.
In July 2003, the 8th U.S. Circuit Court of Appeals affirmed Judge Kornmann’s decision, and in October they denied a petition for rehearing. In February 2004, the Justice Department asked the Supreme Court to review the decision; in May, the Court agreed.
>> Successful Farming magazine reported that Smithfield now owns more sows than 1994’s top 10 pork producers combined. The latest numbers show that Smithfield currently owns 808,000 sows, compared to 65,000 in 1994. Smithfield grew by 1,200 percent over the 10-year period.
The top 10 U.S. pork producers in 1994 were: 1) Murphy Family Farms; 2) Carroll’s Foods; 3) Premium Standard Farms; 4) Tyson Foods; 5) Cargill; 6) Prestage Farms; 7) Smithfield Foods; 8) National Farms; 9) Goldsboro Hog Farm; and 10) Sand Systems.
Smithfield’s substantial growth came from absorbing the largest of its competitors – Murphy Farms and Carroll’s Foods Inc. – as well as Farmland Foods and Alliance Farms, with a combined 68,000 sows.
From 2003 to 2004, the number of sows for the top 30 largest pork producers increased by roughly 137,000. Yet slightly more than 92 percent of that increase was due to acquisition and industry consolidation, not to adding new sows. That’s a lot of pork!
Contact: Traci Bruckner, tracib@cfra.org
for more information.
R-CALF USA Meeting in Northeast Nebraska
On November 15 at 7:00 p.m., the Creighton Livestock Market in Creighton, Neb. will host a meeting with R-CALF USA to give people the opportunity to learn more about the organization and to become members.
November 16 at noon the Creighton Livestock Market will host a fund-raising auction for R-CALF USA. At such auctions, a calf is donated and auctioned. The first buyer typically re-donates the calf to be sold again with the process continuing until all donations are in.
R-CALF USA, the Ranchers-Cattlemen Action Legal Fund, United Stock Growers of America, represents thousands of U.S. cattle producers on domestic and international trade and marketing issues. R-CALF USA is a national, nonprofit dedicated to ensuring the continued profitability and viability of independent U.S. cattle producers. Members are located in 46 states, and the organization has over 60 local and state association affiliates, from both cattle and farm organizations. Various main street businesses are associate members of R-CALF USA.
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Feature
article:
Listening to Nebraska: the Results of the Listening Sessions
By Russ Gifford, Director of Communications
When Chuck Hayes and I hit the road asking people to define the most pressing issues affecting their communities, I wondered if I’d get enough notes to justify the blank notepad I took with me. Nebraskans, and rural Americans in general, aren’t the first to talk when asked to tell you how they feel. Plus, how many people would leave their comfy homes – or their fields – on a cool September night to attend a meeting? Chuck told me not to worry – and he was right.
Ten days, 1500 miles, and 200 people later, we returned with a notepad filled with proof that people will talk when they know that the people asking actually care about hearing their opinions. Chuck’s style of running the meetings brought me new respect for the concept of facilitating. He brought people together, and like very few discussion leaders I’ve seen, he stayed out of the way when they were talking.
What we knew going in: there are a lot of issues in rural America.
What we wanted to learn: what are the big issues, the ones everyone recognizes as being crucial to the continued existence of the way of life in rural areas.
What we proved: people in rural areas are very well informed, and they aren’t waiting for someone to come and “tell them how to fix things.” They are looking for the handle they can use to fix these issues themselves.
The Big Issues
While the discussions varied from town to town, these were the big issues citizens identified in every meeting:
- Tax issues, specifically property taxes.
- School costs, and the problems with consolidation.
- Wages and income in rural areas, and the impact of free trade.
- Health care issues – specifically health insurance.
- Technology constraints and the problems that could cause rural business development and rural schools.
- Environmental issues and food quality concerns.
- Major agriculture-related issues that came up everywhere:
- Limitations of government-sponsored farm payments.
- The looming question of how to balance the water needs of agriculture, tourism, and cities.
“It didn’t matter where the discussion started,” said Chuck, who is Director of Special Initiatives at the Center. “These were the key issues that eventually came to the surface.” That’s good news – everyone recognizes the need for changes on the same issues.
What Comes Next?
“The results will help guide our state policy planning efforts,” said Hayes. Since these sessions, the Center has published
Digging Deeper II, an issue brief concerning possible changes in the Nebraska state tax law, pushing forward the discussion with possible solutions.
“Our issue briefs are intended to offer useful and timely research and analysis on these issues to a broad range of people – policymakers, those interested in rural issues, and others,” said Jon Bailey, Rural Research and Analysis Program Director. “They are basically used to provide a contribution to state and federal debates on rural issues.”
Also, by getting people talking, we have started the process. We’ve helped to focus the people who will make something happen. Second, what was also clear – the size of Nebraska makes it difficult for those interested in making a difference to have their voices heard. That’s where the Center can be of help.
“The Center will publish the results in our newsletter,” said Hayes, and keep the discussion going, and bring in more people who are interested. And don’t overlook the feedback the newspaper, TV, and radio stories about our listening sessions have generated. These stories have brought more attention to these important issues.
And there is more to this than Nebraska. As we move forward with these issues, we are evaluating the process for a wider rollout.
We Need Your Help
That’s a great start – but where do you fit in? If these are issues that concern you – and judging by the responses to our trip, they are – we need you. Do you want to get involved, to make things happen? Talk to others about these issues. Join us
and make a difference. Not only in your life and your state, but in rural America as well. And keep watching – there’s more to come!
Send your thoughts to: Russ at russg@cfra.org
We appreciate it!
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School Consolidation Fight Back Toolkit Now Available to Citizens
The Rural School and Community Trust has developed a six-part toolkit to help communities fighting to keep their schools open
Small schools across the country face consolidation nearly every day. Usually, two strong forces vie, one trying to close a school or center and another trying to keep it open. Reasons cited for consolidating range from political motivation to supposed cost savings to keeping a viable community.
Now there is a “toolkit” available from the Rural School and Community Trust for those trying to keep a school open. Six sections are included. They are briefly described below.
- Summary of an award winning look at school consolidation in West Virginia – West Virginia has aggressively pursued forced consolidation with little success. This looks at what has happened in the state since 1990.
- Alternative ways to achieve cost-effective schools – It is widely believed that consolidation will lead to more efficient administration. The truth is, when consolidation takes place the district becomes bigger with schools spread over a greater distance. The administration is removed from the communities, centers, and students for which they are responsible.
- School size, school climate, and student performance – Written by Kathleen Cotton, this is a comprehensive review of formal research studies on school size.
- Distance learning – When consolidation is being considered, an argument usually offered includes improving the curriculum for students. With today’s technology, distance learning and virtual classrooms are becoming an increasingly popular option for small, remote schools.
- Fiscal impact of school consolidation – Fifty years of research is showing that school consolidation doesn’t reduce per pupil costs, as many believe. A number of fixed expenses are not considered when looking at this small picture.
- School size and research-based conclusions – Small schools are able to do a lot for their students that many larger schools couldn’t possibly dream of. This section takes a look at those highlights.
To get a copy of the toolkit, call 703.243.1487 or visit the Rural School and Community Trust’s website,
http://www.ruraledu.org/docs/consolidation/conskit.htm
Fresh Promises for America’s Rural Places
Presenting strategies and practices that are helping to revitalize rural communities
Centerville Farmers’ Market was launched in the summer of 2003, in Lincoln, Nebraska’s Historic Haymarket District. It began as a joint effort of several Nebraska farmers and local business people who supported them.
The opening followed years of effort on the part of business partners, the State of Nebraska Department of Agriculture, Lincoln Action Programs, the Nebraska Cooperative Development Center, the University of Nebraska Food Processing Center, dozens of local and area food producers, and many others.
The Centerville Market is one of a kind in that it is an indoor farmers’ market. The market is housed in a 1901 Huber Tractor warehouse that offers 5,000 square feet of retail space. Approximately 40 vendors operate in Centerville, with as many as 70 during the regular growing season.
One of the primary goals of the Centerville Market is to increase the awareness of issues connected with the source of food. Through education and promotion, Centerville is building public support for sustainable, regional food systems; increasing consumer knowledge about alternative product choices; building demand for these products; and expanding to year-round markets.
The Centerville Market provides a diverse base of producers, processors, distributors, and consumers/customers of value-added agricultural products while also providing assistance to them to access new, more profitable markets for regionally grown foods.
Being established as a downtown, urban outlet for farm products has shown positive signs for consumer interest, farmer and small business involvement, and encouragement to new investment. A local restaurateur has emerged, wanting to help develop a local foods kitchen in the market.
A diversion from offering local products led to an organic coffee farmer through the Organic Crop Improvement Association (OCIA) with interest in roasting and marketing farm direct coffee. Through this collaboration, the market may be capable of offering organic bananas, pineapple, etc.
For more information, contact John Ellis, Market Manager at 402.477.2322 or by email,
centervillemarket@alltel.net
Contact: Kim Preston, kimp@cfra.org
for more information or to submit ideas for this column.
Nebraska’s Property Tax Relief
Falls Short
The lowest income areas of Nebraska shoulder tax burdens over 200 percent greater than Nebraska’s highest income areas, according to the newest issue brief released last month by the Center for Rural Affairs. “The data clearly show the regressive nature of the property tax,” said Jon Bailey, one of the report’s authors.
Regressive taxes mean that people of lower incomes shoulder a larger share of the public burden, which becomes very clear in the
Digging Deeper in Shallow Pockets II Issue
Brief. The study found the average taxpayer in high-income counties pays 3.28 percent of their income in property taxes, while property taxes for the 10 counties with the lowest per capita income was 10.62 percent of their income. Note that the low-income counties were all agriculturally dependent.
The Issue Brief recommends the Nebraska Legislature adopt property tax relief targeted to rural and urban property owners who are truly burdened by property taxes. In fact, since 2001 the Legislature and Governor have reversed course on property tax relief due to budget shortfalls, which has only increased pressure on property taxpayers.
Bailey suggests a “circuit breaker” concept adding an eligibility category based on income to provide property tax relief to those who are truly overburdened. The Center’s Brief recommends any type of circuit breaker legislation considered for Nebraska should:
- Apply the circuit breaker to both agricultural and residential property.
- Apply the circuit breaker only to owners/operators of property.
- Provide a strong definition of “income” so the circuit breaker does not become a shelter for
income.
Want to know more? The Issue Brief is available on the Center’s
website.
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