Brief Summary of Minutes of Annual Meeting

2. Minutes approved unanimously

3. Dan Rossi
Briefed on requirements of multi-state project
Changes in the new farm bill

• New foundation for food and agriculture
• Programs that lapsed are back
• New 1890 – Central State University in Ohio
• NIFA received increase in budget
• Greater need to document impact
• Extension community starting new website to document impact, research to join
• Delphi to identify societal challenges, distilled down to 3 issues: roadmap
• Working with a marketing agency to market NIFA
• Starting on a visioning process to identify future societal challenges and future of the process of decision making.
• 100th anniversary of Smith Lever – Cooperative extension
• Need for more social science representation in NIFA research agenda
• Need strong academic leaders to represent social science
• Need for room for exploratory research, not just immediate results
• What is the role of non-profits and NGOs?

4. Electing new secretary: Yong Chen voted incoming secretary

5. Choosing location for next year’s meeting:
Next meeting with Southern Regional Science Association – Mobile, AL; March 26th; Battle House Renaissance

6. Other business:

• Reminded of focus on primary objectives
• Accomplishments and impact statements needed soon
• Focus on impacts (changes that result from activities)
• Annual reports should be sent to Brian Whitacre

7. Special Address: David Kay from IMPLAN

• Changes
• New data sets
• New opportunities

Objective 1 - Local / Regional Foods: To better understand the emerging opportunities and threats to the economic structure of non-metropolitan communities arising from the potential shifts in local and regional food systems.

The recent push for promoting local foods has sometimes touted benefits that include economic growth and development. The research to support such a claim, however, is quite weak. NE-1049 researchers in Wisconsin and Colorado have responded to this issue by developing a series of working papers, making presentations at state and regional conferences, and conducting workshops and seminars geared towards educating individuals involved with the local foods movement. This body of work generally focuses on moving from the promotion of the local foods market towards developing sustainable business practices by the farmers participating in those markets. Helping these individuals think through their business strategies is a vital part of improving the current local and regional foods movement – as is ensuring that claims of enhancing “economic development” are not oversold. Researchers in Colorado have also published papers on the economic value of agritourism, and issues/opportunities surrounding small farm transitions.

Along these same lines, researchers from Pennsylvania, Vermont, and the USDA examined whether community-focused agriculture can serve as a development strategy to induce local economic growth. The study found no association between community-focused agriculture and growth in total agricultural sales at the national level, but did in some regions of the U.S. A $1 increase in farm sales led to an annualized increase of $0.04 in county personal income. Community-focused agriculture made significant contributions to economic growth within the northeastern U.S region. Recognizing the regional differences that exist in the economics of local foods is crucial to putting the issues in context. Additional research assessed wholesale hub locations in food supply chain systems, and observed the relationship between food store density, eating habits, and obesity.

Several states in the group participated in USDA’s Stronger Economies Together (SET) program that focuses on capacity building in rural America. Each participating region is made up of at least 3 counties that agree to work together and develop a high-quality regional economic development plan. Researchers from NC, OK, OH, PA, CO, MO, and GA were involved; one important element included developing an economic analysis of the region’s current or emerging clusters. A common theme among many participating regions was to produce / consume more local food products and to enable agriculture to play a greater role in the local economy. Several strategies emerged that focused on these topics, including training farmers on alternative production / marketing tactics and establishing regional marketing facilities (food hubs). The anticipated impacts include increased farm profitability (along with spillover effects into other parts of the economy) and gains from the general process of collaboration between SET communities.

Researchers in North Carolina examined the impact of USDA broadband loans on the agriculture industry. They used modern evaluation techniques (such as average treatment effects) to assess whether specific indicators of economic performance in the agriculture sector were positively affected by the broadband loan program. Generally, the results confirmed that the USDA programs did benefit the agricultural sector, with recipients of broadband loans having higher increases to their farm revenues and overall profits than otherwise similar counties that did not receive any loans. Positive impacts to the crop sector are particularly noted, while gains to the livestock sector have effectively disappeared after the initial pilot loan program (around 2002-2003). Importantly, many of the benefits of the current program are concentrated in rural areas. This type of analysis is crucial to justify expending public resources in rural areas. Without this type of policy evaluation, assessing the value of specific investments in rural America would be impossible.

One major issue associated with local foods is that as consumers buy local through direct contact with producers, they reduce their buying at local retailers. The net impact on rural communities has yet to be evaluated. A survey of revenues and expenditures of producers for local food markets was developed and administered in Missouri and Nebraska. Analysis is just beginning, but the results will be used to create an input-output model that can estimate the net impact and assess the overall impact on rural communities.

Objective 2 – Community Resilience and Natural / Human-made Disasters: To identify and analyze policies and strategies contributing to the viability and resiliency of communities in responding to economic and policy changes and to natural and human-made shocks.

In Michigan, NE-1049 researchers have focused heavily on Detroit’s tax base erosion following the Great Recession. This has included journal articles on options for property tax reform and the potential impacts of property tax rate changes on residential and business property values. This research has received a significant amount of attention; the state tax commission became involved and conducted an independent investigation. The Detroit mayor also announced in late 2013 that property assessments may be reduced by as much as 50% in some locations. An estimate of the savings to property owners would be in the neighborhood of $30 million.

Other research in Michigan has focused on the interplay between natural disasters and the formation of social capital, which is an important but relatively unexamined aspect of natural disasters in the economics literature. This ties in nicely with what researchers in New Jersey are working on, which essentially constructs community-level databases of people’s needs or skills during and after a time of disaster. Essentially a community-based social network, this project has begun work in three states (NJ, NY, and PA) by launching the community exchange networks and beginning the planning process for how to inform the public about the benefits of this type of sharing economy. County extension agents are seen as crucial to this process, and the project itself serves as an example of the linkage between research and outreach.

Researchers in Wisconsin and Missouri have teamed up to study tax and expenditure limitations – in particular, whether they hinder bridge infrastructure, how they impact state credit ratings, and their relationship with economic growth. These types of studies are vital to the topic of community resiliency, as they deal with a relatively common policy issue that have become increasingly under scrutiny since the Great Recession. These policies limit the level or growth of government revenues or spending, but the implications can vary dramatically across jurisdictions or potential uses of the funds. Understanding these linkages is crucial for policy making associated with community resilience.

On the topic of community resilience, a team of researchers in Ohio has focused on assessing economic development policies. In particular, how effective these policies are in creating jobs, reducing poverty, increasing incomes for the middle class, and in promoting sustainable development. They have also studied how land use activities contribute to carbon emissions – and, in turn, climate change. Spinning off from this, the researchers have sought to develop practical ways to generate long-term economic growth at the local and regional scale through improved land use planning and long-term government policymaking. Their research has also examined the implications of the interdependence of regional economic growth, including the rural-urban linkages that are vital to today’s society. Important findings include that universities are indeed crucial to develop human capital, but perhaps not as important as initially thought on topics such as spin-offs or ‘creative’ jobs. Additionally, their work has clarified the role of natural amenities in generating regional growth, as population in counties with high-value amenities has become more concentrated over time. Ohio researchers also focused heavily on environmental issues, with policy briefs looking at issues such as how emerging shale natural gas mining will affect the state and local economy, along with the associated housing needs. Press releases, web-based publications, radio interviews, op-ed pieces, and public presentations accompanied many of these policy briefs. These have all had an impact on long-term planning associated with the shale energy boom.

Researchers in Tennessee investigated the role of rural firms in regional clusters. In particular, they sought to determine what factors influenced clustering, and what cluster characteristics were related to the cluster’s impact on local economic development. In particular, the role of innovation and a supportive entrepreneurial / small business environment was assessed. Their research focused on the Appalachian region, which is important because many of the counties in this region are persistent poverty, have low wage occupations, and have a high percentage of jobs in resource extraction. The research suggests that road infrastructure financed by the Appalachian Regional Commission was crucial for improving job and income levels in these counties. This suggests that rural economies may expand as access to agglomeration economies increases. Other research, focused explicitly on manufacturing establishments in the region, suggests that firm entry and exit were significantly influenced by firms that managed to survive and stay in the market – and that the idea of “creative destruction” was not necessarily holding sway. These results are useful for understanding implications for policies aimed at attracting or retaining manufacturing establishments in rural America. In particular, they suggest that stimulating firm birth could contribute to a sustainable manufacturing base of incumbent firms.

Missouri has developed several tools that are useful for helping local governments understand long-term budget trends, and has presented national webinars and trainings on the topic. They also briefed members of the American Water Works Association on the use and functionality of the Economic Consequences Assessment Tool, which helps water utility managers reduce the economic costs of water outages.

Several states (Missouri, Oregon) and the USDA worked cooperatively to develop strategies contributing to wealth creating in rural areas. Two dominant strategies included entrepreneurship and emphasizing existing rural resources. Outputs included articles, book chapters, presentations and policy briefs.

Researchers in Oregon have looked at whether the land use decisions made by the federal government have impacted communities in the northwestern U.S. In particular, the Northwest Forest Plan that went into place in 1994 shifted over 11 million acres out of forest production and into forest protection. Timber harvests on federal land declined dramatically as a result, and many residents were concerned that their way of life would be negatively impacted. The research found, however, that implementation of the NWFP appears to have increased community wealth as measured in real property value per capita of the communities close to the NWFP land (except if they were dependent on logging). Importantly, the short-term effects (i.e. during the 1990s) were negative for the wealth and income of communities with ties to the wood products industry; but after 2000, the negative impacts subsided and NWFP adjacent communities experienced higher growth in community wealth than communities more than 10 miles from NWFP-protected land. Oregon researchers also looked at migration in rural areas. They found that the long-run distribution of population across rural U.S. counties with high-valued natural amenities has become relatively more concentrated (versus dispersed). This likely has implications for policy induced behavior changes and the effectiveness of ecological policies. Policies that ignore the recursive relationship between urbanization and water quality unintentionally exacerbate boom-bust cycles of regional growth and decline, and risk pushing the system towards long-run economic decline. Oregon researchers also examined out-migration among rural communities, and determined that smaller communities are more at risk of population loss than are larger ones. Further, they examined the economic interdependence of a specific metropolitan core (Portland) and its rural periphery, and found that the core has grown faster than the periphery. They documented the extent to which core growth affects the periphery and vice-versa; and noted that the fortune of each region is affected by growth or decline in the other. They also explored how increases in SNAP participation impacted the core – periphery relationship, and found that the core benefits more from a given level of income transfer to poor households, while high-income households benefit more than low-income households from the indirect and induced impacts of SNAP.

Examining differences in skills across the U.S. rural-urban hierarchy, researchers in Maine find that the occupation clusters that are the most prevalent in rural areas are among the lowest in terms of required skills. This has implications for the pattern of earnings that is observed across the rural-urban hierarchy. Researchers also analyzed the economic impacts of big-box stores on Maine’s retail sector, and assessed how being in the “creative class” impacted post-recession employment trends. They found that members of the creative class had a lower probability of being unemployed and that the impact of having a creative occupation become more beneficial in the 2 years following the recession.

Broadband Internet access remains an important issue in rural America. Researchers at USDA and in Oklahoma continue to explore the relationship between the Internet and rural economies. Studies have looked at the economics of communication and information service delivery. The USDA-ERS has advised the GAO, FCC, OECD, USDA-RUS, WTO, and NTIA on the subject. A comprehensive report from researchers in OK, TX, and MS provided in-depth analysis of the current state of the rural – urban “digital divide”; the primary deterrents of adoption in rural areas; and the influence of broadband on rural economies. The researchers use a variety of modeling techniques to suggest that it is broadband adoption (and not just availability) that is driving improved economic outcomes in rural areas. For example, a rural county that aggressively adopted broadband by 2010 had higher rates of income growth and lower unemployment growth than did otherwise similar communities. Similarly, rural counties with low rates of broadband adoption saw lower growth in the number of businesses than their otherwise similar counterparts. A series of popular press articles summarizing these findings was published by the rural-oriented website The Daily Yonder. Current research is examining whether broadband availability has any impact on a physician’s decision on whether or not to adopt Electronic Medical Records (EMRs).

Research in Oklahoma explored the long-term economic impacts of USDA water and sewer investments in rural communities across the state. Looking at loans and grants made to specific communities during the 1990s, they determined that the programs did have an impact on the median house value of those communities over the long run (15-20 years). No other long-term impacts were found. This type of program evaluation is useful to federal policymakers who seek to invest in programs that have measurable results.

Linkages between counties are an important part of rural quality of life. Researchers in Minnesota compared where workers live and where they work; such information may be useful to county / commissioner planners and regional economic developers who want to better understand the spillover effects of job creation in different locations. They found that half of all Minnesota workers work in a different county from which they reside, demonstrating that local labor markets in Minnesota cover a broader geographic area than is often used for local economic development policies. They also looked into the provision of child care in rural communities, particularly investigating families with low incomes who use child case subsidy programs to help cover the cost of care. They looked at factors that could predict changes in child care arrangements by low-income families. Interestingly, parents who received a subsidy were not more likely to make changes in their child care provision.