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Heavy cuts to rural development and infrastructure in latest Trump budget

The new Trump budget would cut funding to grant programs that support essential services that rural towns cannot afford on their own, like fixing broken sewer systems and community service projects. (Michael S. Williamson/The Washington Post)

Rural Americans stand to lose billions of dollars in federal assistance to support infrastructure and economic development in their communities, according to an analysis of the Trump administration’s 2018 federal budget. Many of the programs for elimination provide direct services to rural areas where Trump is most popular.

The White House would slash rural housing subsidies, mortgage loan guarantees, programs that maintain clean water and other utilities and independent agencies that support job training programs. In many cases, states would be expected to offset spending cuts to critical infrastructure, like sewer repairs; but in other cases, including development grants that revitalize neighborhoods or seed new local businesses, communities would likely have to turn to private organizations for funding or assistance.

Members of Congress likely will fight against many of the proposed cuts that benefit their constituents directly.

Trump proposes dramatic changes to federal government, slashing safety net programs that affect up to a fifth of Americans

The Rural Utilities Service would lose billions of dollars under the proposed budget for the U.S. Department of Agriculture, including more than $2 billion used to keep power lines, phones and Internet connectivity working in rural areas. Funding for rural business owners also would be slashed, from nearly $130 million in 2017 to $31 million.

“The 2018 budget eliminates this program because it has not been able to show evidence of improved outcomes; such as economic growth and decreasing out-migration,” the proposal says.

USDA’s Rural Housing Service would also see billions in cuts that virtually eliminate direct loans and mortgage guarantees for rural households, potentially making homeownership and revitalization more difficult. Under the administration’s proposals, there is no funding for new housing grants for rural families or farm laborers in the budget, nor for direct loan subsidies.

It’s not just programs for the poor. Trump’s budget calls for vast changes to government.

The Rural Housing Insurance Fund — which provides mortgages to rural home buyers and insures home loans — would cut the budget for its direct-loan program to $250 million in 2018, from nearly $3.7 billion in 2016. The budget does not detail the White House’s reasoning for ending the program, but the conservative Heritage Foundation — which has provided much of the groundwork for the administration’s budget priorities — has railed against the program in the past, saying that government subsidies deter private lenders from entering the market.

The Trump administration is expected to introduce its 2018 budget proposal on May 23, which will likely include major cuts to programs for low-income Americans. (Video: Jenny Starrs/The Washington Post, Photo: Jabin Botsford/The Washington Post)

The budget would also end housing repair grants for very low-income people in non-metro areas, saving $30 million from 2016 levels, and would end a program that provides loans for rural housing revitalization, saving another $20 million. The budget also shaves $30 million by ending a program that provides guidance for people seeking to build their own homes in partnerships with other families.

The administration is also seeking to cut nearly $50 million in subsidies to renters in rural areas, reducing funding for that program to $1.3 billion. The budget continues to provide about $1.3 billion in funding for such people.

Trump budget seeks huge cuts to science and medical research, disease prevention

Funding for research meant to benefit rural and agricultural areas would also be greatly diminished by the new budget. The Agricultural Research Service — which funds scientific research specifically focused on issues related to farming, livestock, nutrition and food safety — would see its discretionary budget cut by $165 million.

The budget also calls for the termination of several independent agencies that invest heavily in rural America, including the Appalachian Regional Commission and the Delta Regional Commission. The ARC is particularly popular among politicians and community leaders in Appalachia. Because many infrastructure projects, such as sewer system overhauls and highway repairs, are not high-profile, many Americans who benefit from such federal funding are unaware. In Kentucky, one program funded by the ARC is helping retrain workers who have lost their jobs in computer training, including coal miners; other funding has gone toward creating seniors centers, community kitchens, drug rehabilitation spaces and educational programs.

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Even some Republicans balk at Trump’s plan for steep budget cuts

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