Bridging the urban-rural funding gap

Posted June 30, 2011, at 5:11 p.m.

Recently the National Highway Traffic Safety Administration denied Fort Kent grant funding that would have provided resources for a program geared at preventing underage drinking.

The TSA’s reason?

The community is “WAAAAAAYY off the beaten path” and it would be difficult to conduct site visits to develop compliance reports.

Fortunately, Maine’s congressional delegation reacted, voicing concerns that the northern Maine community had been the victim of “rural discrimination.” Sen. Olympia Snowe said that the TSA’s decision to withhold support from Fort Kent was “wrong” and “unfair” and has called for the NHTSA to address the issue.

The issue — which is less about the loss of the $125,000 grant but rather more about the statement that the community’s rural nature prevented the investment — sheds light on the widening gap between urban metro and small metro-rural communities. Our nation has, by investment, transferred from a policy that invests in all types of communities to one where investment is made only in certain types of communities.

According to the Rural Policy Research Institute, in 2008 the 100 largest metropolitan areas in America held 74 percent of the country’s college graduates, 75 percent of workers with graduate degrees, 82 percent of National Institutes of Health and National Science Foundation research funding, and 96 percent of all venture capital funding. It certainly appears that the scale is out of balance when it comes to rural areas.

Beginning in 2008, more total federal funds per capita were invested in metro areas than in non-metro areas. According to the same report, in 2008, the majority of investments in terms of community resourcing funding per capital was in rural areas. In 2009 that switched, with more such funding in urban areas — with an urban-rural funding gap of more than 25 percent.

This trend, documented by Government Accountability Office report of March 2011, titled “Opportunities to Reduce Duplication in Government Programs, Save Tax Dollars, and Enhance Revenue” provides an interesting picture of future federal investment into rural areas.

But why? This trend seems to come from two factors: the shift of farm income to non-farm income as the primary revenue to families and the shift of federal defense spending to more urban regions. We have two examples of the latter right here in Maine — remember the significant economic impact of the closure of both Loring Air Force Base and the Brunswick Naval Air Station?

Sadly, the downward trend for investment into rural areas is not limited to the federal government. Foundation grants increased from $31.8 billion in 2004 to $45.6 billion in 2008 (Source: Daily Yonder/Rick Cohen with data from the Foundation Center) a 43.4 percent increase in investments. However, donation to rural development was down in 2008 than 2004, from $92.7 million to $89.5 million.

As the Obama administration begins breaking down federal funding silos through a more multi-agency competitive development grant award process, it is important that we watch to make sure that investment in rural areas, like eastern Maine, is not lost or overlooked.

While we participate in this new federal system, the data suggest there is also an urgent need for development of our own framework for regional development. Efforts like Mobilize Eastern Maine, where private and public sector entities work together finding opportunities to advance the region’s existing assets, are important pieces of the framework. Similarly, development organizations are working together in a collaborative network to empower communities, institutions and individuals to find their own ways to generate wealth. We will do this by investing in our place, advancing our knowledge base and the skilled work force and expanding the business foundation through entrepreneurship and innovation.

But we can’t do it alone. A fundamental component of this strategy is the retention of our youth. It is our responsibility to create a place where the young people of our region not only want to stay but it must be a place they can afford to call home. We must engage all educational and community institutions and help build sustainable careers, pathways to those careers and a culture that eastern Maine is great place to learn and to live.

Michael W. Aube is president of Eastern Maine Development Corporation in Bangor. He is a past commissioner of Maine’s Department of Economic and Community Development and former state director of Maine USDA Rural Development.

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