NRECA CEO Jim Matheson is urging House and Senate leaders to achieve a compromise Farm Bill that strengthens programs critical to electric cooperatives and rural America.
“Through the Farm Bill, Congress has an opportunity to strengthen the economic engines that are rural communities with job-creating loan programs for electric co-ops and support of rural broadband internet,” said Matheson.
“America’s electric co-ops strongly encourage lawmakers to negotiate a Farm Bill that can be supported by the 42 million Americans we serve.”
The Senate voted 86-11 for its Farm Bill June 28. The House cleared its version June 21 in a narrow 213-211 vote. A conference between both chambers is expected later this year to resolve the bills’ differences.
Here’s how the two Farm Bills treat provisions key to electric co-ops:
Farm Bill Provision
|Rural Electrification Act (REA) Cushion of Credit Program||Retains the existing escrow accounts for co-op loan repayments and current treatment of deposits||Ends the program; reduces interest on current deposits||Retain and strengthen the program to address continued low interest rates|
|Guaranteed Underwriter Program (GUP)||Reauthorizes the program with technical changes to improve loan terms||Reauthorizes the program with technical changes to improve loan terms; allows GUP loans for generation||Reauthorize the program with technical changes to improve loan terms|
|Rural Energy for America Program (REAP)||Reauthorizes without mandatory money||Reauthorizes with mandatory money||Reauthorize with mandatory money|
|Rural Energy Savings Program (RESP)||Reauthorizes with user-friendly changes; increases from 3 percent to 5 percent the amount available for administrative costs||Reauthorizes with user-friendly changes; increases from 3 percent to 6 percent the amount available for administrative costs||Reauthorize with technical changes|
|Rural Economic Development Loan and Grant (REDLG) Program||Reauthorizes and extends funding beyond 2021||Reauthorizes and extends funding beyond 2021; $5 million/year in mandatory money||Reauthorize with technical changes|
|Rural Cooperative Development Grant (RCDG) Program||Reauthorizes||Reauthorizes||Reauthorize|
|Broadband grants||Creates grant program that can be paired with other RUS loans; grants are based on density served; requires agriculture secretary to establish forward-looking speed/quality standards; moderate FCC coordination||Creates grant program with 90 percent “unserved” requirement; defines “served” as 25/3 Mbps; moderate FCC coordination||Favors new grant program paired with RUS loans; grants based on density; aggressive on speeds; avoid barriers to program deployment|
|Use of electric loans for broadband||Allows 10 percent of electric loans, under certain conditions, to be used for broadband||Allows 10 percent of electric loans to be used for broadband||Not requested|