Budget Proposal Sends Mixed Signals on Development in Rural Communities

ARLINGTON, Va. – National Rural Electric Cooperative Association CEO Jim Matheson issued the following statement on the administration’s fiscal year 2020 budget request:

“The administration’s budget proposal is a mixed bag for rural America. It rightly recognizes the need to modernize rural economies by investing in rural broadband and providing loans for the development of rural electric infrastructure. But the budget also proposes to eliminate funding for key programs like the Rural Economic Development Loan & Grant (REDLG) program, and calls for the sale of federal power marketing administration transmission assets. Selling PMA assets will jeopardize affordable and reliable power for more than 100 million people and raise electricity prices for rural Americans.

“Electric co-ops look forward to working with policymakers to secure and promote longstanding, proven programs that prioritize a vibrant and prosperous rural America.

“The president’s budget proposal prioritizes $200 million for rural broadband and recommends $5.5 billion for RUS electric loans. But it also recommends eliminating vital rural economic development programs, including REDLG and the Rural Energy Savings Program and, for the third year, proposes to sell off PMA transmission assets.  More than 600 electric co-ops rely on PMAs for access to low-cost, hydroelectric power. Selling these federal transmission assets will inevitably increase costs for co-op members. Congress repeatedly has rejected this proposal and should do so again this year.

“In addition, the administration’s international affairs budget request proposes a 30-percent cut from last year. Although specific programmatic funding levels are not yet available, this would likely limit the development assistance programs and electrification programs that help fund NRECA International’s work.”

The National Rural Electric Cooperative Association is the national trade association representing more than 900 local electric cooperatives. From growing suburbs to remote farming communities, electric co-ops serve as engines of economic development for 42 million Americans across 56 percent of the nation’s landscape. As local businesses built by the consumers they serve, electric cooperatives have meaningful ties to rural America and invest $12 billion annually in their communities.