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Local Effects of the Fiscal Cliff
Thu November 15, 2012
Rural Development at Risk Due to Fiscal Cliff
Rural communities face possible cuts to the assistance they receive from the federal government. The House version of the currently-stalled Farm Bill makes deep cuts to some rural development programs.
But Tim Collins said a bigger threat comes from the so-called fiscal cliff. Collins who is with the Illinois Institute for Rural Affairs points out last year’s debt ceiling debate led to a combination of tax hikes and spending cuts.
That could reduce the availability of USDA low interest loans for infrastructure improvements in rural communities.
“Specifically a lot of these loans programs, the financing for them could go down the drain,” Collins said. “The rural development section of the USDA could virtually disappear. You would see tremendous cuts to rural research.”
He added that conservation programs, which are also at risk, benefit local infrastructure as well. For example, he said the strain on rural drinking water systems could increase due to increased amounts of soil finding its way from farm fields into streams.
Collins says the loans are one of the least apparent but most important rural development programs of the USDA. Collins says preparations are being made to shut down some of these programs if their funding is in fact cut.
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