Related Links

• Investing In Rural America Conference
• Small Town and Rural Initiative
• Small Town and Rural Communities topic page

Transcript

Tim Sablik: In May, the Richmond Fed hosted its fifth annual Investing in Rural America Conference in Roanoke, Virginia. Sonya Waddell, a vice president and economist at the Richmond Fed who you heard in the introduction, kicked off the two-day event.

On today's episode of Speaking of the Economy, we'll be sharing some of the key insights from speakers at the conference, which brought together more than 250 community leaders to learn, connect, and discuss best practices for solving challenges facing small towns and rural communities.

In his opening remarks, Richmond Fed President Tom Barkin explained how the annual conference has become a cornerstone of the Bank's research and work.

Barkin: When I started in 2018, one of my first questions for the team was, we're charged with stewarding the economy, where's the economy working best and where is it not? The metric we used was employment to population — the percentage of prime-age people in a particular community that were employed. The data won't surprise anybody here. Small towns were performing less well than big cities.

So, I asked, what is it that we're doing to help small towns? And the answer was not that much. That is where we started this journey of asking ourselves, "What can we do to help?"

When we dug into the work, we thought we were going to be talking about the challenges facing small towns. But as we've gotten into the work, we've gotten ourselves excited about the diverse array of strengths and assets that are in our small towns. We've made it our priority to try to understand and then amplify promising paths and solutions. And that's a lot about what this is today.

Sablik: The keynote address featured Martha Claire Bullen and Ines Polonius of the nonprofit Communities Unlimited, Inc. They discussed how outside organizations can help rural communities and small towns by bringing together local leaders and identifying assets and funding for projects.

Martha Claire Bullen: When we go into communities, a lot of times there are people that literally live three streets from each other [but] they've never sat down at a table and talked about anything to do with community development. ... You got to get the people in the room together locally and get them talking so that they know who are the other people in the room. What are the assets that they might bring to the table that you've never considered because you've never talked to them about what they do?

If we go into a community and we're able to find an entrepreneur that's going to do the work that needs to be done there and we can invest in and build them up, that wealth that is locally grown and locally owned is what is going to really sustain a community over time. We need to invest in the people and the places and the firms [and] the organizations that exist in those communities. So, we bring in the resources where there are gaps, but the goal is about local ownership so that they can control and influence their own opportunities to thrive.

Ines Polonius: Are there community members that are willing to reinvest in their own community? That to us is one of those momentum measures, when somebody local says, "Wait, we've got this plan. I'll put in $1,000 or $100 or $10." They're willing to invest their own resources in their community.

Sablik: The theme of this year's Investing in Rural America conference was building and sustaining momentum. Polonius noted that organizations like Communities Unlimited can help start the process of change, but sustaining that momentum takes commitment from within.

Polonius: If we don't leave those leaders in a place where they can lead without us, then we've just implemented another project. We're trying ... to step away from sort of project thinking, and really get to a place where those community leaders see opportunity, develop strategy, resource themselves, and create the change themselves.

Sablik: Bullen and Polonius also advised local leaders to identify smaller, achievable projects to generate quick wins and build momentum for tackling larger problems.

Bullen: If you're not ready and you think you're going to go after that project and you get there and find out you don't have that one piece that you didn't realize you needed, it's slamming into a wall and it will absolutely derail momentum.

Polonius: And the next time you come back, maybe one or two people show up. That whole team and all that momentum that you built is gone because they thought they were ready, when in fact they weren't and that $150 million project isn't going to happen overnight.

Bullen: And then, when we talk about being ready, sometimes the biggest part to keeping them in the room and not losing them is "accelerator projects." We call them quick wins on our team, but they're sometimes hard to fund. They're not high-dollar projects. But man they do create that hope.

Polonius: If we're in a room full of economic developers, who the heck talks about hope? Do we talk enough about hope? At the end of the day, it is hope that creates engagement, and that leads to change.

Sablik: Finally, when it comes to ensuring long-term success, Bullen talked about the need to create space for the next generation of community leaders.

Bullen: As we're looking at sustaining momentum for long-term change, you got to keep a table ... open for new people. There are new projects that happen all the time. Technology is changing, opportunity is changing.

Part of that is building the next generation of leaders. You've got to bring in that younger party and say, this is going to be your community. We hope you're gonna stay here. We're gonna get you really good broadband infrastructure so you'll want to create all these opportunities within your community where it's a thriving community for you to stay in.

Sablik: Measuring success, as well as identifying the assets within a community, takes data. Obtaining that data can be a challenge for small towns and rural communities. In the first plenary session of the Investing in Rural America conference, Jacqueline Ponti-Lazaruk, chief innovation officer of the USDA's Rural Development Innovation Center, discussed the importance of identifying and collecting data before undertaking a project.

Jacqueline Ponti-Lazaruk: I think the challenge in applying the data to what it is you're trying to do is really the highest for us.

When we hired our data analytics team ... we asked many questions to make sure they understood this was not a research place. This was not a place to do long-term studies. This was applied analysis and it had to be used in real time as much as possible, which is scary to people who are highly qualified. They have all their methodologies, peer reviews, and we're like, that's great. But you're going have to find a middle ground to get there.

I think rural areas face the same challenge. How do we take this data and apply it in a real way that matters? I think one of the things I hope we talk about today is finding those metrics that matter to the community. We have lots of data, but at the end of the day what makes a real impact in your community is going to be different from community to community. It may be very personal and local.

There are indicators that you can use. Sometimes it's pretty simple. But you have to stop and think and then be able to collect that information so that you can measure it. You have to have your baseline, you have to have something to compare to, and you have to collect it over time.

I think the last challenge would be finding the time to do more of that, to take the time to plan and to create those methodologies before you jump into the solutioning.

Sablik: When trying to identify assets and measure success in a rural community, researchers look at more than hard numbers, explained Emily Burleson. She is a senior manager for advocacy and research at Partners for Rural Transformation.

Emily Burleson: When we take quantitative data and zoom in to these smaller localities — maybe rural and native and BIPOC communities, especially for persistently poor communities — there isn't a clear picture of what's going on. ... There's a lot of methodologies that are not quite hitting the marks, so we need them to in these rural communities.

When the numbers are not there, the only thing is left is the stories. So, when we gather qualitative data from these communities, it is a precious gift.

And again, we're trying to not only just take that story. Share it with them, let them leverage it for future use, and really make it the community's data that they can use in any way that they see fit. ... They're the experts on the stories, what they need done in these communities. They know what solutions they need. I think our job is to give them the tools to be able to do it.

Sablik: Corianne Scally, a senior fellow at the Urban Institute, discussed how research organizations can collaborate with communities to collect and analyze data.

Corianne Scally: It's really important to have community members involved from the beginning, if possible, on any kind of data collection endeavor.

One unique strategy ... we've implemented across communities that we work with is a "data walk." That's presenting preliminary findings of anything that you've done to gather data on the community back to the community in an interactive, easy-to-read format to ground-truth the findings.

Ask community members, "Does this resonate with you? Does this reflect your lived experience on the ground here? What are you surprised to see here? What do you want to know more about that you don't see here." ... The best quality check we have often is the community feedback on the data, so we definitely encourage community involvement wherever possible.

Sablik: The second plenary session of the conference focused on federal funding programs for small towns and rural communities. The panelists agreed that the issue isn't a lack of funding opportunities. It's whether small towns and rural communities can take full advantage of those opportunities.

For example, the Brookings Institution reviewed the Infrastructure Investment and Jobs Act, the CHIPS and Science Act, and the Inflation Reduction Act and identified $464 billion worth of potential funding. But according to Tony Pipa, senior fellow at Brookings' Center for Sustainable Development, just $24 billion of that money is designated specifically for small towns and rural communities. The rest is open to local governments big and small, urban and rural.

Tony Pipa: We're in the place where rural is going to be vying alongside a lot of other jurisdictions to be able to access those funds.

And then, just to make things even more interesting, when we look at that catalog of programs that we said were rural relevant, there are 66 new programs in there to add on to the 400 plus that we had before.

The U.S. federal government has a lot of programs that are spread throughout every nook and cranny. Frankly, it's an ecosystem that's well intentioned, right? Each of these programs reflects a response by congressional members to a felt need that they've heard from constituents or others. But, in the end, it ends up being very fragmented and difficult to navigate.

Sablik: These challenges are compounded by the fact that local governments in many small towns and rural communities have limited resources.

Pipa: Many rural governments have volunteer elected officials or part-time elected officials. They might have thinly staffed city halls [and] generally don't have someone that's doing grant writing or doing economic development and planning. Their staff is often much more service oriented, so just navigating the maze is a starting point that's very difficult.

Match requirements and the cost shares of federal programs are often an immediate barrier. ... Rural communities have a disproportionately lower access to philanthropic resources, and their fiscal bases are often pretty constrained with their tax revenues.

Sablik: Irma Diggs, senior executive and director of federal advocacy at the National League of Cities, points to one instance when federal dollars flowed to small towns and rural areas with less resistance — the implementation of the American Rescue Plan Act or ARPA.

Irma Diggs: In total, it was $350 billion that went to states, tribes, counties and cities and territories — $65.1 billion went to municipal governments, [another] $65.1 billion went to counties. Of the amount that went to municipalities, about 19.5 billion of those dollars went to any use, so non-entitlement units below 50,000 in population.

Because Treasury allowed the revenue replacement option ... it was easy for a lot of communities to just do from a reporting standpoint. They were able to offset their revenue losses and then use that funding to really stabilize their government operations. That, in and of itself, gave them flexibility to meet their own local priorities.

For the most part, ARPA was successful in allowing them to stabilize fiscally. It allowed them to address their public health and public safety needs — purchasing new fire trucks, police cars because many communities hadn't — to invest in their workforce training programs, hire additional people, pay overtime when they didn't have the funding to.

The Department of Treasury established a 1-800 number we recommended and established a hotline that people can call to get very quick answers. Those things no longer exist in this third anniversary of ARPA. And so part of the message is going to Congress and talking about the need to invest in the administrative support for localities to do it.

Sablik: There is also a role for state, regional, and national philanthropic organizations to improve the flow of dollars to the communities that need it most. Sherece West-Scantlebury, president and CEO of the Winthrop Rockefeller Foundation, said that organizations like hers often obtain the funding themselves and either apply it to support programs or re-grant it.

Sherece West-Scantlebury: Philanthropic dollars can enhance the effectiveness of acquiring and using federal resources. The low hanging fruit is a support match — supporting grant writers, enabling capacity building.

Unlike federal dollars, which many of you know has strict guidelines and slow processes, philanthropy can be nimble, can be flexible, can be responsive in our communities. An example of how we do this is the Delta Philanthropy Forum ... a collaborative platform that aims to advance a resilient and equitable distribution of dollars in the Delta region through investing in capacity and fostering collective impact. The forum brings together philanthropy, community development financial institutions, government entities, and local organizations to co-invest in strategies. ... Since its inception, the forum has facilitated the investment of over $10 million in the Delta region, supporting a wide range of initiatives from small business development to education to health care.

In conclusion, when combined with federal resources, philanthropy can foster resilient, equitable, thriving rural communities. ... It's about us working together to unlock our potential and ensure every community gets federal resources so that we can thrive as a state.

Sablik: To keep up with all of the Richmond Fed's rural research and work, be sure to visit our website, richmondfed.org. And if you liked what you heard on today's episode, please consider joining us at next year's Investing in Rural America conference.