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USDA Issues Guidance for Implementing New Definition of Rural

Published on March 14, 2014 by
USDA Issues Guidance for Implementing New Definition of Rural

The U.S. Department of Agriculture (USDA) recently provided guidance on implementing the new definition of rural, as revised by the Agricultural Act of 2014 (commonly referred to as the Farm Bill).

The Farm Bill allows rural communities that would have lost their eligibility for USDA’s rural housing programs due to USDA’s use of the 2010 Census data to retain their eligibility through 2020 and increases the population limit to 35,000 from 25,000.  Language was also included in the FY 2014 appropriations omnibus to allow any area eligible for rural housing programs as of September 30, 2013 to retain that eligibility through the end of FY 2014.

USDA’s notice applies to all Rural Development single-family and multifamily housing loan and grant programs.  USDA is taking a two-phased approach to implement the change.

The notice proposes to implement phase one on May 6, 2014.  For phase one map changes, areas meeting any of the three following criteria will be classified as eligible:

  1. The area was eligible as of September 30, 2013.
  2. The area:
    • Was eligible prior to October 1, 1990; or
    • Was eligible between January 1, 2000 and December 31, 2010; and
    • Was subsequently changed to ineligible and was ineligible on September 30, 2013; and
    • Has a population that does not exceed 35,000 (2010 decennial Census); and
    • Is rural in character.
  3. The area population decreased following the 2000 decennial Census, and the 2010 decennial Census indicates it is now below the population limit for the area.  (Unless the area meets the criteria outlined in either phase one map changes (1) or (2), then it can only be eligible if it is located in a Metropolitan Statistical Area (MSA) and the population does not exceed 10,000; or if it is not in an MSA and the population does not exceed 20,000.)

The notice proposes to implement phase two on October 1, 2014.  For phase two map changes, areas meeting any of the following criteria will be classified as ineligible:  

  1. The area was eligible prior to October 1, 1990, or deemed to be eligible between January 1, 2000 and December 31, 2010 and the population exceeds 35,000 per the 2010 decennial Census.
  2. The area has been annexed into a larger ineligible area and has become part of the larger Census Data Place.
  3. The area was formerly eligible but is no longer rural in character due to further development and urbanization that is inconsistent with the new rural area definition.

The notice states that the designations of eligible and ineligible areas will be updated to the public website after proper notification to the public.  USDA will provide further guidance on the changes it has made to the eligibility maps and public access to them as it implements the new definition.
 

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