Federal Policy Priorities: Transforming Areas of Persistent Poverty into Persistent Prosperity

 PRT Federal Policy Priorities October 2020

The Partners for Rural Transformation is a national coalition committed to serving rural communities in persistent poverty. Collectively, we serve the majority of people living in persistently impoverished places, largely rural areas. We have a significant presence in the Mississippi Delta, Appalachia, Indian Country, the Black Belt, agricultural western communities and communities along the U.S./Mexico Border.

On its face, persistent poverty is a measure used to describe counties and parishes where the poverty rate eclipsed 20 percent for three consecutive decades. A closer examination also paints a picture that is steadfastly rural and marred by racial inequity. Of the 395 persistent poverty counties, eight out of 10 are non-metro and the majority (60 percent) of people living in persistent poverty counties are people of color.

Often, in regions of persistent poverty, other forms of distress are also present – high unemployment, a lack of access to banking services, a paucity of quality affordable housing, food insecurity, health care deserts, inadequate school funds, and unsafe drinking water – all of which contribute to higher rates of premature death and lower health outcomes.

Importantly, solutions exist. For decades, Community Development Financial Institutions (CDFIs) in some of the most economically distressed regions of the country have been working alongside community members to address the employment and housing, banking and infrastructure needs of local people and places. Yet despite their success, philanthropic, bank and federal investment in persistent poverty regions is dramatically less than in places with significantly more resources; thus perpetuating and exacerbating inequity.

Congress and federal agencies can take action to advance social and economic opportunity in our nation’s most distressed communities. To this end, we make the following recommendations to increase resources to persistent poverty areas, each is discussed in this brief in more detail:

  • Increase and prioritize federal investment in persistent poverty areas
  • Increase capital to CDFIs serving persistent poverty areas
  • Adjust existing federal programs to better reach persistent poverty areas
  • Strengthen the Community Reinvestment Act (CRA)
  • Ensure persistent poverty areas have the resources needed to recover from COVID-19

In addition to these solutions specific to addressing federal funding and capital gaps in persistent poverty areas, low-income families across the company have critical needs. Transitioning persistent poverty communities out of deep poverty also requires attention to other financial security and economic inclusion issues. This includes measures, such as adopting strong federal consumer protections against predatory lending, restoring the strength of the Federal Housing Act, curbing abusive debt collection practices, and removing the asset limits from means-tested benefit programs. Additionally, persistent poverty communities will greatly benefit from additional COVID relief, such as direct stimulus payments to individuals and businesses, so long as they are structured to reach those most in need and without regard to documentation status. Finally, we recognize that bold, new ideas to address the racial wealth gap will also help transform our communities, ranging from baby bonds to student loan debt forgiveness.

Building on our 200-year collective experience in rural persistent poverty regions, the Partners for Rural Transformation call on federal policy makers to join us in extending opportunities to the most forgotten corners of America. We have solutions that work. With the capital to take those solutions to scale, together, we will strengthen the playing field in persistent poverty areas, and expand opportunity for all families and communities across this great country.

For more information, contact advocacy@pfrt.org

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