Key Federal Agencies Collaborate to Provide Funding and Support for Rural America

On Tuesday, June 12, three federal agencies announced a new project to assist high-need rural areas facing chronic poverty along the U.S.-Mexico border. This new project is part of a series of initiatives delivered through the White House Rural Council, which recently released a report detailing the steps President Obama and this administration have taken to support rural America.

The Border Community Capital Initiative (“Border Initiative”) is a collaborative effort among the Department of Agriculture-Rural Development (USDA-RA), Department of Treasury’s Community Development Financial Institutions (CDFI), and the Department of Housing and Urban Development (HUD). These three federal agencies signed a Memorandum of Understanding (MOU) and, together, will increase economic development activity at a community level throughout these high need areas, known as colonias.

Colonias are communities within 150 miles of the U.S.-Mexico border. These high-need communities frequently lack fundamental resources such as sanitary housing, access to potable water, and adequate sewage systems. Under the Border Initiative, up to $200,000 will be made available to nonprofit and tribal financial institutions serving colonias. These funds will be used for direct investment and technical assistance focused on providing access to valuable resources that these communities lack.

Previous federal programs with similar goals have faced significant barriers in implementation, such as limited capacity among organizations serving colonias and a lack of stable funding available to them. The Border Initiative is tailored to correct for this by directing funds toward improving the capacity of local financial institutions to raise capital and increase lending; and boosting investment in their communities.

Each agency will work to implement specific facets of the Border Initiative. CDFI will provide scholarships, technical assistance opportunities, and webinar trainings for Border Initiative grantees. USDA-RD will deliver programs supporting agriculture production and business activities that promote fresh food access and distribution.  HUD will make grants available to colonia residents and the community development lenders serving them. HUD will also evaluate the outcomes of the Border Initiative, which, if effective, may be extended to other rural regions throughout the country.

Doug McKalip is the Senior Advisor for Rural Affairs with the White House Domestic Policy Council