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Rural Development Funding in the FY25 President’s Budget

On Monday, the White House sent the President’s Budget Request for Fiscal Year 2025 to Congress – a somewhat delayed release following a prolonged FY24 appropriations process. While the President’s annual budget is largely a wish list and stands no chance of becoming law in its entirety, it does lay out the Biden Administration’s spending priorities for FY25 and hints at the President’s agenda for a second term as we inch closer to the general election. The $7.3 trillion budget request includes investments in housing assistance, full funding for WIC nutrition assistance, a temporary expansion of the American Rescue Plan Act’s child tax credit, increases to the corporate and Medicare tax rates, and more.


The Biden Administration appears to be doubling down on at least one priority from his first term: investing in rural communities. The word “rural” appears almost 70 times in the FY25 President’s Budget. The proposal’s front matter makes a point to highlight past and proposed investments in rural energy, broadband, and water infrastructure; housing assistance; expansion of the Rural Partners Network; efforts to improve accessibility of federal programs; and increased funding to the USDA.


Individual program levels mostly corroborate these claims, but exceptions can be found. Beyond the main budget proposal, the budget appendices for the Departments of Agriculture, HUD, and Interior provide some insight. Let’s take a look at the proposed funding levels for notable rural-serving programs:

USDA Rural Community Facilities Program: $1.25 billion for direct loans ($1.55 billion below FY24 enacted) and $650 million for guaranteed loans (no change from FY24);

USDA Rural Housing Assistance Grants: $46 million ($11 million above FY24 enacted);

USDA Rural Housing Service - Rental Assistance Program: $1.7 billion (almost $100 million above FY24 enacted);

Rural Partners Network: $10 million in dedicated USDA funding ($8.5 million above FY24 enacted);

USDA Rural Energy for America (REAP): $1 billion in loan guarantees for ($950 million above FY24 enacted);

USDA Rural Utilities Service - Water and Wastewater Disposal: $1.37 billion for direct loans ($510 million above FY24 enacted) and $50 million for guaranteed loans (no change from FY24);

HUD Rural Capacity Building Program: $5 million (no change from FY24); and

USDA Rural Cooperative Development Grants: $28.3 million ($3.7 million above FY24 enacted).

Also of note to rural communities, particularly in the West: the budget proposes increased investments to address the wildfire crisis, including almost $1.28 billion for the Department of Interior’s Wildland Fire Management account (about $17 million above FY24 enacted) and increases to wildland firefighter pay.


Keep in mind, the majority of the proposed funding levels in the President’s budget request were likely composed long before the first tranche of FY24 appropriations, which included the Departments of Agriculture and Interior, was passed. The numbers may also reflect the expiration of funding streams and supplements provided by the Inflation Reduction Act and Infrastructure Investment and Jobs Act.


The budget announcement also came the day before the Senate Environment and Public Works Committee marked-up the Economic Development Reauthorization Act of 2024, which was late last week. In addition to reauthorizing the EDA first the first time in almost 20 years, the bill creates additional considerations for public works grants to benefit rural communities with inadequate tax bases and requires a GAO study to examine the impacts of EDA funding on distressed rural areas.


As FY25 appropriations begin to take shape, stakeholders advocating for more federal funding and resources for rural communities should capitalize on the momentum generated by the President’s budget request.


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