“…Rural America is a unique and interesting place that I don’t think a lot of folks fully appreciate and understand. They don’t understand that while it represents 16 percent of America’s population, 44 percent of the military comes from rural America. It’s the source of our food, fiber and feed, and 88 percent of our renewable water resources. One of every 12 jobs in the American economy is connected in some way to what happens in rural America. It’s one of the few parts of our economy that still has a trade surplus. And sometimes people don’t realize that 90 percent of the persistent poverty counties are located in rural America.”
—Tom Vilsack, United States Secretary of Agriculture, May 5, 2011

In each iteration of the New England Community Outlook Survey, the financial well-being¹ of lower-income individuals and families has ranked among the most pessimistic measures. Respondents consistently observe decreasing financial well-being and predict a pessimistic future. This October was no different; over half of respondents said the financial well-being of lower-income people in their communities has decreased. Furthermore, the future does not appear to hold much relief, as 88% of respondents predicted a further decrease or no change in the situation. The urban and rural experiences appear to be very similar. (Figure 4) The survey defines financial well-being as the ability to fund basic needs; of course, two of the most basic needs are affordable housing and access to food. Lack of affordable housing and food insecurity are among the top problems facing vulnerable populations. Affordable housing consistently ranks among the top challenges in the New England Community Outlook Survey. Food security is beyond the current scope of the survey; however, the USDA did issue a report on food insecurity and found that in 2012, 14.5% of the households (about 49 million people) in the United States were “food insecure.” New England fares little better with only half of the states² reporting rates less than the national average.

New England is dominated both economically and demographically by Boston and its surrounding area, which accounts for 32% of New England’s population³ and 47% of the region’s gross domestic product (GDP).⁴ Consequently, those who live outside of the larger cities are often overlooked. There are over 1 million people living in small towns or rural areas in New England,⁵ and in many cases, these people face the same challenges as their urban counterparts.

New England’s poverty rate increased from 9.1% in 1999 to 10.5% in 2011, mirroring a nationwide increase during the Great Recession. During the same time period, the rural poverty rate in New England rose from 10.5% to 12.6% in 2011. It is important to note that Massachusetts’ more-buoyant economy masks a more concerning picture for the rest of the region. A more dismal picture emerges from the data on individual states.

Maine, comprising almost half of the land mass in New England, has 9% of the population but 43% of the region’s rural population. (Figure 5) The poverty rate in 2011 in Maine was 12.8%, but in rural Maine poverty topped 15%. In several Maine zip codes, more than one in three residents live beneath the poverty threshold.⁶ While effective poverty reduction in urban areas often provides basic needs through programs like the Supplemental Nutrition Assistance Program (SNAP) and housing vouchers, in rural areas, these solutions may not have the same impact.

"Rural eastern and northern Maine traditionally have high unemployment and under-employment numbers. …The rural infrastructure and the limited and untrained workforce does not lend itself to economic growth."
—New England Community Outlook Survey respondent from Maine

Responses to the Community Outlook Survey consistently indicate that availability of affordable housing is a pressing issue for both rural and urban lower-income communities. (Figure 6) Both urban and rural survey respondents rank affordable housing the second most important challenge for lower-income communities after job availability. Nine out of 10 rural respondents⁷ saw the availability of affordable housing decrease or stay the same over the past six months, and most of those respondents do not see any relief in the near future. Perhaps more telling is the difference over the past six months. Almost 28% of urban respondents saw affordable housing availability increase while fewer than 8% of rural respondents reported an increase. The Housing Assistance Council put out a report in 2012 that found “Over 7 million rural households—three in ten—pay more than 30 percent of their monthly incomes toward housing costs and are considered cost burdened.”⁸ In New England, from 2008 to 2012, only 22% of new units in multiunit buildings were added in the largely rural states of Maine, New Hampshire, and Vermont. Over the same period, on average, Maine only added 609 additional units in multifamily residences per year. Rural communities, due to their smaller nature and lack of density, present a different set of challenges for affordable housing organizations. The dispersed nature of rural populations reduces the impact (relative to urban/suburban populations) of many of the traditional programs for affordable housing (Section 8, Section 42, etc.). Consequently, many of the programs are focused on urban populations. Smaller towns struggle to attract developers of affordable rental housing because of the lower rents they command relative to urban developments. That is not to say that the rural affordable housing world is bereft of assistance programs. The issue is that many of the rural affordable housing programs are either aimed at developers in order to increase the stock of rural rentals or at home purchase assistance, which is much harder to scale and not always a viable solution for under- and unemployed rural poor. Increasing the stock of rural rentals is a slow process that may take years, and developers are often more interested in higher returns available in multifamily developments in metropolitan areas.

There are solutions that work in rural areas. In August of this year, Maine Housing launched an initiative to help lower-income people replace pre–1976 mobile homes with newer, more energy-efficient manufactured homes. The program includes low-cost credit for the homeowners as well as a $30,000 grant to ease the financial burden. In New Hampshire, the Community Loan Fund recognizes that rural and small town affordable housing does not mean developing new buildings but has turned to affordable manufactured housing as a possible solution. Through a variety of programs—from low-cost manufactured home mortgages for resident-owned communities to matched savings to help people save for their first home purchase—the Community Loan Fund has directed more than $150 million to rural New Hampshire. Sometimes, small town affordable housing has to combine urban and rural efforts. In Vermont, the Champlain Housing Trust manages over 1,500 affordable apartments in small towns throughout the northwest corner of Vermont.

In spite of the best efforts of aforementioned organizations and their peers, the future is not rosy for rural or urban affordable housing; there is a severe shortage of affordable housing in both urban and rural New England. According to the New England Housing Network, there is a “…795,000 unit shortfall in affordable rental housing…”⁹ in New England. In late November 2013, the USDA announced that Section 521 Rental Assistance funding, which is aimed at subsidized rent for low-income rural households, had run out of funds and would be unable to renew any funding contracts until the new fiscal year in mid-January 2014. In the current environment of budget tightening and results-driven funding, the limited housing funds available may be directed more to high-impact urban/suburban development projects, leaving rural affordable housing development behind and competing for a smaller share of resources.

"...there is a persistent confidence gap and lack of awareness particularly among rural youth that there are many opportunities for a better life income wise."
—New England Community Outlook Survey respondent from Vermont

Part of the financial well-being definition is the ability to fund basic needs, primarily housing and food and health care, but also may include household utilities, child care, and other needs. The most widespread food assistance program is SNAP. While the program has its critics, it still remains the primary source of food assistance for the poor in America. For rural populations, the challenge, as with affordable housing, is related to the distributed nature of the population. Rural populations in Maine are on average two miles farther¹⁰ from the closest SNAP outlet¹¹ than their urban counterparts. In a rural setting, with fewer public transport options, and fewer direct routes, two additional miles could mean the difference between a short walk and a long drive. Figure 8 shows the distance to the closest SNAP outlet. Some areas (albeit sparsely populated) are more than 20 miles from the closest affordable food provider. Households in rural Maine zip codes are 1.3 times more likely than their urban counterparts to receive SNAP assistance; thus, the people most at risk have the least access. This is just one example of the differential access to public programs between urban and rural populations. Recent changes to the SNAP program as a result of the decline in government funding due to the sequester threaten to further erode the assistance it provides to all lower-income individuals and families. According to the Center on Budget and Policy Priorities, a family of three saw a decline of 5.5%, or about $29, in their food budget just in time for the 2013 holiday season.

Source: USDA SNAP outlets and author’s calculation