Rural America left behind without a stimulus, but Congress can still make a difference

Small Towns

Published in The Des Moines Register, Nov. 8, 2020

Rural businesses and communities have been waiting for Congress to pass a second stimulus package for months. With Election Day behind us, Congress should not delay in passing another stimulus bill. Two bipartisan proposed bills should be included, because they offer common-sense solutions to help rural economies weather the pandemic.

One bill is the Rural Equal Aid Act, a bipartisan, bicameral bill led by Rep. Cindy Axne, Democrat of Iowa, that would offer support to rural entrepreneurs. The second is the Strengthening Local Processing Act from Rep. Chellie Pingree (D-Maine) and Rep. Jeff Fortenberry (R-Nebraska), which would strengthen rural economic opportunity by supporting small meat processors.

One of the major barriers rural small businesses face is access to credit. While small-business loans to rural entrepreneurs can be enormously helpful, rural banks are generally reluctant to service these small loans. The U.S. Department of Agriculture has a program to help — the Rural Microentrepreneur Assistance Program, or RMAP, which works with third-party lenders to offer up to $50,000 loans and business training. More than 2,100 small businesses have been helped by RMAP since its creation in 2008.

Unfortunately, RMAP was overlooked by the Coronavirus Aid, Relief, and Economic Security (CARES) Act passed in March. Loan relief was included for small businesses funded by the Small Business Administration, but not for small businesses that work with USDA. The many small businesses across the country that rely on RMAP loans were simply left behind.

Axne’s Rural Equal Aid Act would remedy this and offer equal relief to businesses that rely on RMAP loans. The bill would also extend similar loan relief to rural businesses supported by USDA’s Intermediary Relending Program, to loans made to public and nonprofit organizations for community facilities, and to businesses, cooperatives, and nonprofits expanding in rural areas. Congress should include this bill in an aid package.

The Strengthening Local Processing Act would offer opportunity to rural small meat processors. For decades, family farms have diversified their income by raising a small herd of cattle or a few hogs for meat. Since large meatpacking plants do not work with small producers, these farmers must rely on an ever-shrinking number of small meat processing facilities.

But with the pandemic, as packing plant workers fell ill and plants closed, many consumers turned to locally processed meat, and small meat lockers were suddenly swamped with demand. The farmers who could usually book an appointment for their animals with a few weeks or months notice, suddenly faced delays of 12 to 18 months. These bottlenecks highlight the need for more processing capacity from small meat lockers.

The Strengthening Local Processing Act would help to rebuild this vital link in the local meat supply chain by offering grants and other assistance to small meat lockers that would like to expand. This expansion would in turn build rural economic opportunity for small farmers seeking to offer customers locally raised meat.

Congress, do not ignore rural communities. Include and pass these bills in stimulus legislation without delay.