The Rural Blog Archive: August 2004

Monday, Aug. 30, 2004

Data on income, health coverage suggest rural areas lose ground

As the nation’s median household income held steady last year, states with large rural populations dominated those that lost ground, according to the Census Bureau’s latest report on income, poverty and health insurance in the United States.

The states with the largest percentage declines in average median household income from 2001-02 to 2002-03 were: Alaska, 6.8; Arkansas and Kentucky, 3.9; Texas and Arizona, 3.8 percent. Massachusetts declined by 3.2 percent, while Illinois, North Carolina and Rhode Island dropped 3.1 percent. (The bureau uses two-year averages to compare trends across time and three-year averages to compare states.)

States with statistically significant income increases were North Dakota (+4.3), Washington (+3.7), Idaho (+3.4) and West Virginia (+3.2). Despite its gain, West Virginia remained the lowest state in median household income, and the percentage of its people living in poverty went up, to 17.1 percent from 16.6 percent.

In three-year averages used to compare states, West Virginia remained one of those with the highest poverty rates, at 16.9 percent, the same as Louisiana. Those with higher rates were Arkansas (18.5), New Mexico (18.0) and Mississippi (17.9). The District of Columbia’s poverty rate was 17.3 percent.

Only Mississippi and North Dakota showed statistically significant declines in poverty rates. States showing increases were South Dakota, Nevada, North Carolina, Illinois, Virginia, Michigan and Texas.

Only two states, California and Utah, showed statistically significant decreases in the percentage of people without health-insurance coverage. The percentage of uninsured rose in 20 states. From the greatest to the smallest increase, they were: Montana (2.9), Oregon (2.2), Iowa (1.9), West Virginia (1.7), Wisconsin (1.6), North Carolina, South Dakota, Rhode Island, Idaho, Massachusetts, Washington, Virginia, Pennsylvania, Indiana, Tennessee, South Carolina and Nebraska.

The states with the highest three-year average of uninsured residents were Texas (24.6), New Mexico (21.3), Louisiana (19.4), Nevada (18.3), Alaska (17.8), Arizona (17.3). The rates for states in Central and Southern Appalachia, from highest to lowest, were: Georgia, 16.4; North Carolina, 16.1; West Virginia, 14.8; Alabama, 13.3; Kentucky, 13.3; South Carolina, 13.1; Virginia, 12.5; Tennessee, 11.8.

State-by-state rates of coverage appeared to be driven in part by the size of a state’s Hispanic population. Nationally, 33 percent of Hispanics lacked health insurance.

The full report is at:

When the figures were released late last week, John Kerry’s campaign used the figures to criticize President Bush’s economic record, but the campaign made no special note of the apparent impact on rural areas.

Campaign focus on rural voters doesn’t mean they have greater impact

"Rural America shares some of Bush’s conservative views, but rural America also has suffered the most economically," Curtis Gans, director of the Committee for the Study of the American Electorate, told Ellyn Ferguson of Gannett News Service in a story for today’s edition of The ( Huntington) Herald-Dispatch. Ferguson notes that in 15 of the 20 states targeted by the presidential campaigns, one in four voters live in rural areas, compared to one in five in the nation as a whole.

However, that doesn’t translate into greater impact, Ferguson wrote: “Two things may work against rural voters’ moment in the Election Day sun: They lack the concentration of numbers that give groups in urban and suburban areas political muscle, and they have no consensus on the solutions to their problems. Although rural voters share general traits -- majority white, socially conservative churchgoers and supportive of the armed services -- the places they live differ. Some are withering as manufacturers close and young people flee to find work. Others are farming communities or growing centers for affluent retirees.”

Bush carried 59 percent of votes in rural areas in 2000, according to exit polls. "I think the rural folks feel taken for granted by the Republican Party and written off by the Democrats," said Tom Rowley, a fellow at the Rural Policy Research Institute. Ferguson notes “a June poll of 536 likely rural voters in 17 battleground states showed Bush with a 9 point lead over Kerry in rural areas, down from a 15-point lead earlier in the year. ”

The poll was sponsored a coalition of 76 individuals and rural groups, including the Center for Rural Strategies, based in Whitesburg, Ky. Its president, Dee Davis, said the poll showed that both parties have a lot of work to do. “N either party has anything to brag about in rural America," Davis said. "Democrats have been abandoning rural areas and Republicans have been feeding rural areas a steady diet of cultural issues."

Rural areas have borne a disproportionate share of American military deaths in Iraq. The war has had other impacts, Ferguson reports: “Rural community leaders say the call-up of reservists and National Guard members has left them short on police, volunteer firefighters and others who are often the backbone of their communities.”

Ferguson ’s story was accompanied by a sidebar on a West Virginia tobacco farmer who is raising his last crop:

Campaigns still battling for West Virginia's five electoral votes

Speaking of the Mountain State, Bush won West Virginia by portraying Vice President Al Gore as an environmentalist hostile to coal, and he is trying to reprise that strategy with Sen. John F. Kerry,” today’s Washington Post reported.

"I'm running against a fella who is kind of shifting,” Bush said. “A while ago he said coal is a dirty source of energy. Then he decided he wanted to come to your state and knock on your door. And then he said, now, well, I am for legislation that is supporting clean coal technology. In other words, he shifted. He's out there mining for votes. All I'm asking you to do is tell your friends and neighbors, be careful of somebody whose position shifts in the wind."

Kerry's campaign issued a statement saying Bush "has played politics with the steel industry from day one, and his miscalculations have hurt steelworkers," asserting he championed free trade before imposing tariffs and then pulled them "before the steel industry could recover." Appropriating a signature line from Bush's campaign, the statement said the nation needs "steady leadership when it comes to helping steelworkers, not political posturing." See

The Associated Press reports, “Sunday's visit to West Virginia was Bush's seventh as president and he plans to return Saturday in a scheduled appearance in Parkersburg. Kerry has campaigned in the state five times. Vice President Dick Cheney and Kerry's running mate, Sen. John Edwards of North Carolina, also have campaigned in the state. Edwards was in the state last weekend and will be in Beckley on Tuesday,” with former United Mine Workers President Richard Trumka, now secretary-treasurer of the AFL-CIO.

West Virginia has long been listed as a “battleground” state in the election, but ABC News more or less predicted in Sunday’s edition of The Note that Bush is likely to win its 5 electoral votes. It included the state among six battlegrounds that would go to Bush. The Note said it “nudged or forced . . . those states into Bush’s column” and four into Kerry’s column, “making the tough calls about where currently close states will likely end up when the voting actually happens.”

However, The Note’s rival, The Hotline, still puts West Virginia in Kerry’s column, on the basis of an American Research Group poll July 26-28 showing Kerry leading 48 to 44 percent, plus or minus 4 percentage points. Chuck Todd, editor-in-chief of The Hotline, said in a National Journal Convention Alert this morning that only six states are "true coin flips" -- Florida, Iowa, New Hampshire, New Mexico, Ohio and Wisconsin. Todd argues that four states -- Louisiana, New Jersey, Virginia and Washington -- are real battlegrounds only in pundits' imaginations.

On the beat: AGs say HIPAA doesn’t apply to cops; journalism groups ask support for source protection; SPJ, NFPW meetings coming up

The privacy rules in the federal Health Insurance Portability and Accountability Act (HIPAA) do not apply to the names of injured people in police reports, Kentucky Attorney General Greg Stumbo ruled last week. Stumbo is the second attorney general to render an opinion on the law, following his counterpart in Texas, according to the Reporters Committee for Freedom of the Press. The law, written with hospitals and other health-care providers in mind, has complicated newsgathering in communities large and small in every state.

The Society of Professional Journalists national convention will be held in new York Sept. 9-11. For program and registration information, go to SPJ has helped organize a show of support for the reporters who, in recent weeks, have been cited for contempt of court for refusing to disclose confidential sources. SPJ and other journalism organizations believe the recent trend imperils the limited, reporter's privilege identified by prior court decisions and guidelines established for U. S. attorneys around the country. To view and sign the statement, go to

The National Federation of Press Women’s National Communications Conference, Sept. 9-11 in Lexington, Ky., offers sessions of interest to rural and Appalachian journalists.

Friday afternoon, Cathie Shaffer, executive editor of the Greenup County (Ky.) News-Times, will present "The Reporter's Toolbox: Giving Voice to Real Community Journalism," billed as a “two-session, interactive program that uses interactive videos and group discussion in taking a new look at what great community journalism can be.”

Saturday afternoon’s feature session is "Beyond the Beverly Hillbillies: The Real Appalachian Culture," with Bob Sloan, author, poet and contributor of essays to National Public Radio; author David Dick, who won Emmy awards as a CBS correspondent; and Roger Alford, an Eastern Kentucky native writing for the Associated Press from Appalachia.

Also on the Saturday afternoon schedule is "Politics, Privacy and the Press," with Polly Judd, the mother of Naomi and grandmother of Wynonna, who was profiled by People magazine when she ran for city office in 2000; and Tanya Pullin, a Kentucky state legislator who “had no idea that when she ran for state representative and won, the price would be a loss of privacy for which she was totally unprepared.” Media representatives will also be part of the panel.

NFPW events and membership are open to both sexes. The non-member registration fee for the conference is $395. The cost for either Friday or Saturday alone is $200 each. Go to

Friday, Aug. 27, 2004

Show me the beef, as Mondale said, or maybe this year, who owned the cattle: Ownership of livestock by meatpacking firms is an issue for some rural voters

Bloomberg News took a wide-ranging look this week at an issue on which the presidential candidates have a clear difference – meatpacker ownership of livestock, a topic of much concern to cattle and hog farmers in several states that are up for grabs in the race for the White House.

John Kerry’s pledge to fight the practice “may win over farmers who vote Republican,” Wells Fargo & Co. economist Michael Swanson told Daniel Goldstein of Bloomberg in a story published Monday. Wells Fargo is the nation’s largest agricultural lender.

President Bush has not taken a position on the issue. By a margin of 2 to 1, he is the favorite candidate for campaign contributions from farm, feed and food interests.

The U.S. Senate passed a ban in 2002 but the House refused to go along.

Scott Stuart, president of the National Livestock Producers Association,, told Bloomberg that the idea of a ban on packer ownership is “an issue that is very emotional but not based on fact,” and an executive of Smithfield Foods said a ban would “drive small farmers out of business” in North Carolina, the nation’s top hog producer.

The issue is being played out in a lawsuit filed by cattle ranchers against top meat processor Tyson Foods Inc., claiming Tyson hurt them by manipulating prices. A jury awarded the 35,000 farmers $1.28 billion, but the judge “blocked the award, saying it reflected potential damages for all producers, not just those represented in the suit.”

The ruling has been appealed. The Organization for Competitive Markets, which favors more regulation of commodity prices, has posted case files on its Web site,

Kerry says he also supports stronger enforcement of the Packers and Stockyards Act, passed in 1921 “to protect farmers and ranchers from unfair pricing,” and his Web site says the administration hasn’t “hasn’t fought cases of ‘discriminatory pricing’ against smaller farmers,” Bloomberg reported. “Of the states both campaigns consider battlegrounds in the election, eight are among the 20 largest exporters if agricultural products . . . including Florida, Iowa and Ohio.” (The story is no longer available on Bloomberg's site.)

ANOTHER NOTE about the presidential election and rural areas: Every battleground state featured so far in The New York Times’ interactive graphics has a larger percentage of population in rural communities than the nation as a whole. See:

Abercrombie & Fitch continues to have fun and profit at rural folks’ expense

West Virginia Gov. Bob Wise is objecting to retailer Abercrombie & Fitch’s second T-shirt representing his state as a prime spot for incest, the latest in a short series targeting largely rural states.

“What I've learned about a bully is if you don't respond to a bully they just keep punching you,'' Wise told Huntington’s WSAZ-TV on Tuesday. He was referring to the shirt the retailer issued in March, “It’s all relative in West Virginia.”

The chain has also issued shirts about Kentucky (“Electricity in Almost Every Town”) and Wisconsin (“Wisconsin Cuts the Cheese”).

Appearing on MSNBC in March, Wise said, “For many states, and particularly small states, the only contact that millions of Americans have is often through mass media marketing.  So for a lot of contact that people have with my small state, it may be in a T-shirt that they are picking up at a Western store someplace.  And so that‘s not what we want out there.  We have a positive story to tell about men and women in uniform, about the low rate of crime in West Virginia, about a great place to raise and bring up children.”

He said the incest theme is “a stereotype I think that really applies to much of rural, whether Appalachian or indeed the entire country, about rural areas.  And it comes from people who don‘t know. And yet the innuendo that is on this T-shirt is unfortunately a problem that is in urban areas as well.”

Your blogger sympathizes with the governor, but Charleston Gazette columnist Susanna Rodell said in a column today that he should “chill out” because he is only creating publicity, yet again, for Abercrombie & Fitch. “Now, let’s face it, making fun of West Virginia is a longtime tradition in this country,” she wrote. “Most West Virginians I know don’t take them all that seriously. They shrug. They say, ‘Whatever.’ . . . Before I ever heard a West Virginia joke, it was Arkansas jokes.”

Some words from your sponsor

Today’s blog is somewhat late and shorter than usual because your blogger had some personal and professional responsibilities that took precedence, and the rest of the staff is just coming on board at the Institute for Rural Journalism and Community Issues.

Our new assistants, all master’s-degree students in communication at the University of Kentucky, are Krista Kimmel, Alan Lowhorn and Josh Tucker. Brief biographies of them will be posted to our List Serve. To sign up for this service, go to


Wednesday, Aug. 25, 2004

Rural states have greater share of deaths in Iraq war

Soldiers from predominantly rural states are “disproportionately are doing the dying” in Iraq, The State newspaper of Columbia, S.C., reported Sunday, in the latest examination of a phenomenon that appears to be increasingly recognized in rural areas.

Today’s Washington Post has a long story by military writer Thomas Ricks about the feelings of folks in the rural 4th Congressional District of Missouri, as expressed to Ricks and its representative, Ike Skelton, senior Democrat on the House Armed Services Committee.

“To travel the two-lane blacktops of rural Missouri with this man is to plunge into the churning unease that Americans feel about Iraq,” Ricks wrote.

Part of the unease may stem from the body count. A list compiled by The State shows that the top 10 states in per-capita deaths in Iraq are all predominantly rural: Vermont, North Dakota, Wyoming, South Dakota, Nebraska, Delaware, Oregon, South Carolina, Mississippi and Arkansas.

The State and a National Journal story in May noted research for Bill Bishop of the Austin American-Statesman by University of Texas sociologist Robert Cushing, which found that 29 percent of the dead came from "rural areas and small towns," as the National Journal defined it, compared with only a fifth (19 percent) of the general population.

The South Carolina paper noted research done for Skelton, which found that 44 percent of the Iraq dead came from towns of less than 20,000.

Skelton has long been a skeptic of the war, largely because he didn’t think President Bush had properly planned for the occupation, but “grudgingly” voted for the resolution authorizing Bush to start the war, the Post said. He said his constituents still support Bush’s handling of Iraq, but thinks they are moving toward his point of view.

People in the district are divided, said Homer May, a part-time reporter for the weekly Benton County Enterprise. “I think our servicemen deserve our respect and support, but I don’t think we should ask more of our servicemen than is necessary,” said May, a retired federal investigator.

A word of caution to journalists explorring this subject, from the National Journal story by Sydney Freedberg Jr.: "The only readily available data on origins is 'home of record,' which is not only imprecise -- identifying a town rather than a demographically definable neighborhood -- but also potentially inaccurate. Young people often move away from home before enlisting, for example, and long-serving reservists often settle somewhere entirely different from where they lived at first enlistment. In a National Journal spot check of newspaper and wire-service obituaries for dead troops from seven states, 13 percent were found as having grown up somewhere other than in their official Pentagon "home of record."

The State’s story:

The State’s list:


National Journal:

Minnesota case raises questions about small papers' ability to be fair

Should the standards of fairness and thoroughness followed by most metropolitan newspapers also apply to small, rural newspapers with limited staffs?

Yes, the Minnesota News Council in effect said last week, in finding that a weekly paper with a news staff of two and a half was unfair in its coverage of a rape case even though its reports were accurate.

No one from the Wright County Journal-Press read the case file or attended the pre-trial hearing. Afterward, the paper called the prosecutor but not the defense attorney, and never reported that the defendant pleaded not guilty.

Publisher James McDonnell Jr. told the council that the paper’s policy was to cite only reliable sources, and, because its resources are limited, not to investigate cases.

“I think a lot of papers that have meager resources are going to be uncomfortable with this,” said Gary Gilson, executive director of the council, which is divided equally between members of the media and the public. Gilson, who is not a council member, spoke to Mark Fitzgerald of Editor and Publisher, at

The council’s release is at

The case stemmed from an advocacy group’s complaint that the paper did not publish a letter from the defendant, who wanted to rebut the paper’s reports and criticize the investigation and his public defender. He also telephoned the paper. He later pleaded guilty.

McDonnell said he didn’t publish the letter because it might have hurt the defendant’s cause and was sent without the public defender’s approval. He said the paper didn’t call the attorney because defense lawyers historically don’t want their clients to talk to the news media.

The advocacy group pointed out that the paper had sought comment in another case from a prominent local citizen charged with child pornography. The rape defendant was an African American from St. Paul and had been spending time with a girlfriend in the Wright County town of Buffalo. The victim first said her attacker was white, then changed her story.

By a vote of 15-7, the council found that the paper had been unfair. Four of the seven who voted no were media members.

Member Gwenyth Jones Spitz, a retired metro reporter and weekly publisher, said she understood the paper’s lack of resources, “but this was a big story. This was worth your time and effort.” Member Nancy Conner, a former reader advocate of the St. Paul Pioneer Press, said the defendant’s letter and the change in the victim’s story should have prompted inquiries by the paper.

Gilson told Editor and Publisher that one council member asked, “How many rape cases do they have in Buffalo, Minnesota?”

McDonnell told E&P that the council went beyond the original complaint about the letter and that some members had “a condescending tone.”

The Minnesota News Council is one of the few news councils in the U.S., and the oldest. It hears complaints, mediates disputes, holds forums and conducts educational programs.

Tennessee paper gives readers useful background on rural zoning

Independence and self-reliance are key values among the people of the Highland Rim and Cumberland Plateau of Middle Tennessee, so zoning is a controversial subject there, as it is in many rural areas.

The Herald-Citizen of Cookeville reflected that reality Tuesday when it reported that the city and Putnam County officials had agreed on changes to a plan to zone rural areas in the county. Accompanying its story was a helpful sidebar, headlined “What zoning does – and does not do.”

The sidebar reported that zoning in Tennessee can’t be enforced retroactively, doesn’t supersede deed restrictions, and can’t require buildings to be built of certain materials, colors or styles; that state law protects agricultural uses and the use of double-wide mobile homes; and other zoning laws and primciples.

The county, on Interstate 40, began action for rural zoning after an automobile race track was proposed in an unincorporated area.

The newspaper’s Web site is

In another Tennessee land-use story, from The Oak Ridger, Anderson County is suing to tear down a large cross erected along Interstate 75. The county says that if the cross fell, it would land outside the property leased for it, violating local zoning rules.

Full story:


Monday, Aug. 23, 2004

N.Y. Times weighs in on banking reinvestment issue

The New York Times picked up last week on an issue we’ve been writing about, proposals to relax the rules for examining banks under the Community Reinvestment Act. In an editorial on Saturday,, the “paper of record” said the proposals undermine the act, “the most successful community revitalization program in the nation’s history.” The Times acknowledged that CRA regulations need to be updated and simplified, but said proposals by the Federal Deposit Insurance Corp. and the Office of Thrift Supervision go too far. “Banks should not be allowed to jettison community reinvestment responsibilities, which occupy a tiny fraction of banking assets, in the quest for profit,” the editorial said. “If these new regulations are allowed to stand, the loss of CRA-driven investments could be significant in some states, like Alabama, Florida, Idaho and New Hampshire. Communities could eventually find themselves back in the dark ages of redlining and financial isolation.”

The Federal Reserve Board and the Comptroller of the Currency, which regulates national banks, have declined to raise their thresholds for strict CRA examinations, citing potential adverse impacts on rural areas. Here’s a list of contacts on various sides of the issue: David Barr, FDIC, 202-898-6992; Heather McElrath, American Bankers Association, 202-663-5469,; Tim Cook, Independent Community Bankers of America, 202-659-8111; Jim Eberle, America’s Community Bankers, 202-857-3145,; Ross Kleinman, National Association of Affordable Housing Lenders, 202-293-9856; Tim Marema, Center for Rural Strategies, 865-494-7980,; Debby Ross, Rural Local Initiatives Support Corp., 202-739-9276,

Local paper examines Smokies pollution problem

Tourists in the Great Smoky Mountains National Park, who once could easily see peaks 77 miles away, now have an average visibility of only 25 miles because of air pollution, The Mountain Press of Sevierville, Tenn., told its readers this morning. The site is

“With the park being the drawing card that brings 9 million people a year to Sevier County and the region, having cleaner air should be a top priority not only for park officials, but also the surrounding communities that rely on tourism,” staff writer Candace Grimm wrote. “While what we are missing in the way of views is important to correct, of utmost concern is the human health hazard presented by breathing this airborne chemical soup we are seeing.”

Major sources of the pollution include industries, motor vehicles and coal-fired power plants of the Tennessee Valley Authority. The story quoted TVA Director Bill Baxter as saying, “By virtually every scientific measure since the passage of the Clean Air Act in 1970, we have improved our air quality in East Tennessee. The air is getting cleaner, not dirtier." He said TVA will reduce nitrogen-oxide and sulfur-dioxide emissions by 75 and 85 percent, respectively, by 2010.

RFK’s Appalachian trip to be re-enacted, and more

As he decided whether to run for president in 1968, Sen. Robert F. Kennedy spent two days in Eastern Kentucky. “It was a visit that greatly moved Kennedy, who referred to the poverty and hunger he saw in Appalachia during his bid for the White House,” James R. Carroll of The Courier-Journal wrote in reporting that Kennedy’s trip will be re-enacted Sept. 8-11, “in some instances, word for word and step by step.” Some Kennedy staffers will return for the production by Appalshop Inc., the Whitesburg, Ky., arts organization. Carroll’s Sunday column is at

Appalshop says the event, directed by John Malpede, “explores the effects of the ‘war on poverty’ in one of the country’s most distinctive yet marginalized regions” and invites audiences to explore “what’s happened in our relationships to government, community and each other since Kennedy came.” The event will be followed Sept. 11-12 by the Art and Democracy National Gathering, which Appalshop says will continue an effort by “progressive artists, educators and organizers . . . to move society towards a vision of a healthier, more equitable world.” For more information, contact Maxine Kenny at

Columnist joins chorus against fund sales to troops

Don McNay of Richmond, Ky., a financial adviser for injury victims, wrote yesterday in The Richmond Register about controversial “contractual mutual funds” that are often sold to soldiers. McNay said in an e-mail that the issue should be of concern to rural areas because many military installations are in rural areas “ and a disproportionate number of soldiers come from small towns and economically disadvantaged areas.” In his column, at, he wrote, “ The Securities and Exchange Commission tried to abolish the plans back in 1966 and allow purchasers 45 days to get out of them. They are so obscure that the mutual fund industry quit tracking them in 1985 and most investment experts, like Vanguard founder John Bogle, say they would never recommend one.” McNay complimented New York Times financial columnist Diane Henriques for writing about the funds, but said she should have focused more on major companies that offer the funds rather than the salespeople, who get big front-end commissions. “It is like writing about the war on drugs and focusing on street pushers instead of the drug lords,” McNay wrote.

Roofless radio stations are lifelines for Charley victims

We briefly mentioned last week the service performed by Clear Channel radio stations in Punta Gorda, Fla., which kept broadcasting though hurricane Charley tore the roof off their building. The St. Petersburg Times has more: “The radio studio in Punta Gorda, the only one based in Charlotte County, has become a lifeline for residents searching for information to help them cope with the storm's aftermath,” staff writer Chris Tisch reported.

They offer phone numbers, locations where food and water are available, even information on where people can bring their horses. The building has become a trading post of information.”

Bluegrass great Charlie Waller is remembered

Guitarist and tenor Charlie Waller, who died Wednesday in Gordonsville, Va., was one of the “most important second-generation figures” in bluegrass music, The Washington Post reported Saturday in a knowledgeable reminiscence by Richard Harrington: Waller was the only career-long member of The Country Gentlemen, who “helped popularize bluegrass in the late ‘50s and early ‘60s in ways that even an originator such as Bill Monroe could not,” Harrington wrote. Later, the Gentlemen were the first bluegrass band to record a Bob Dylan tune, blended with the “newgrass” of the genre’s third generation and included such future stars as Ricky Skaggs.

Friday, Aug. 20, 2004

Medicare to pay rural hospitals more

New Medicare reimbursement rates, which begin Oct. 1, are a welcome change for rural hospitals in financial trouble, the Associated Press reports. “Basically, they lose money when they treat Medicare patients,” said Michael Robbins, the West Virginia Hospital Association’s vice president for financial policy. “Now, they may not be recovering all their costs, but they will get a little help.”

Congress authorized higher rates, beginning April 1, in a law passed last year. The Oct. 1 change is only the third full inflation-adjusted increase for inpatient care in the last 20 years, according to Bloomberg News. Rural rates will go up 3.2 percent, about double the increase for other hospitals.

Farmers and their bankers decry foreign takeover of farm credit outlet

Farm lenders and the National Farmers Union are objecting to a Dutch bank's planned acquisition of Farm Credit Services of America, which is based in Omaha and serves Iowa, Nebraska, South Dakota and Wyoming. Rabobank, which operates in 35 countries and has more than $500 billion in assets, making it one of the world’s largest banks, announced the purchase July 30. FCSA has $7.8 billion in assets.

The deal is bad for American agriculture because FCSA will have to leave the U.S. Farm Credit System, said leaders of Farm Credit Services of Mid-America, which is based in Louisville and serves Indiana, Ohio, Kentucky and Tennessee. It said the Farm Credit Administration should deny FCSA's application to leave the system "due to the impact it will have on the system's aiblity to meet its congressional mandate and farmers' ability to consistently obtain credit in the four states" served by FCSA.

The Louisville-based association, which has $8 billion in assets, said that if the deal goes through, "Rabobank would control the largest portfolio of U.S. farm loans of any single lender." Rabobank has acquired Valley Independent Bank in California, Ag Services of America in Cedar Falls, Iowa, and Lend Lease Agribusiness, formerly part of the Equitable insurance company, now part of AXA Financial. Its deal for FCSA is thought to be the first foreign purchase of a part of the Farm Credit System.

The National Farmers Union wants the agriculture committees of the House and Senate to hold hearings on the deal. In an Aug. 18 press release, the union said its 300,000 members have “serious concerns” about the takeover. “We are concerned that assistance to beginning farmers, commitments to local communities and access to competitive agricultural credit for all producers may be shoved aside,” NFU President Dave Frederickson said.

Rabobank said in announcing its purchase that the deal should give farmers and ranchers more financing options, because the Farm Credit System will charter new members in four states FCSA now serves. The withdrawal is required when a bank buys a member of the system, as is payment of an exit fee, which FCSA said will be more than $800 million and will go into the system’s insurance fund. The fee “may lower insurance premiums for all Farm Credit System entities for a considerable time,” Rabobank said.

News is where you find it

The story in The Daily Times of Maryville, Tenn., circulation 21,613, seemed out of place. It was written by staff writer Lance Coleman, but was about a state legislator three counties away, with few if any constituents among the newspaper’s readers. But it was a good story, and Coleman knew it. So did other papers, which picked it up this week.

Coleman had traveled to Mississippi with a local Army National Guard unit, the 278th Armored Cavalry Regiment, to cover its training, when he heard that an officer in the unit, Maj. John Mark Windle of Jamestown, was also a state representative who will not be able to serve in the state House this winter because the unit is being deployed to Iraq.

Windle, a Democrat who represents Morgan, Fentress and Overton counties, which have no daily newspapers, is unopposed in this year’s election. He told Coleman that his district has the highest percentage of people enrolled in TennCare, the state’s version of Medicaid, but that staff could take care of constituent services. If the unit is deployed, he said, “I think our constituents expect me to go.” Yesterday, the unit got its orders, Coleman said in a telephone interview today.

The Institute for Rural Journalism and Community Issues seeks to recognize good work in community journalism as part of its efforts to help non-metro media set the public agenda in their communities, grasp regional issues and interpret rural issues for national news media. Send your tips to Al Cross, interim director, at

Monday is deadline to sign up for campaign-finance seminar

Reporters covering the 2004 elections could get some useful help at an expenses-paid seminar to be held Sept. 17-19 at the Omni Hotel at CNN Center in Atlanta. “Covering Campaign Finance: Tracking the Cash in the ’04 Elections and Beyond,” is sponsored by the Center for Responsive Politics, the Southern Newspaper Publishers Association and the University of Southern California’s Annenberg School for Communication, with a grant from the Schumann Center for Media and Democracy.

The program includes sessions on new campaign-finance laws, tricks of the trade, tips on researching contributions, commentary from consultants in both parties, the connections of campaign money, lobbying and legislation, and advice on ad-watching from Ken Goldstein of the University of Wisconsin, who has done groundbreaking research on political-commercial buying patterns.

(A personal note: The program also includes a session titled “Why and How Donors Give.” In 15 years as political writer for The Courier-Journal, I rarely used the word “donor” to describe a political contributor, because the word implies a gift for which nothing is expected in return. That is usually not the case with political contributions, and the folks who will be speaking at this conference know that. --Al Cross)

Attendance at the seminar is free, but is limited. The deadline to apply is 5 p.m. EDT Monday, Aug. 23. Fax your name, title, affiliation, address, phone, fax and e-mail to 404-252-9135. If you have questions, call 404-256-0444. Successful applicants will be notified Aug. 25. The organizers add this final note: "If selected, please understand that a substantial financial commitment has been made for you to attend. You will be expected to arrive on time and participate fully in the entire program." (Saturday night is dinner on your own; since the rest of the trip is on other people's money, you might try the somewhat pricey but very enjoyable Pittypat's Porch, 25 International Blvd.)


Wednesday, Aug. 18, 2004

FDIC proposes to relax bank-examination rules

The Federal Deposit Insurance Corp. has proposed to exempt most U.S. banks from close scrutiny of the investment they make in their communities, a move that advocates for rural areas and inner cities say will reduce the money supply in those areas.

“It’s a shame,” said Judy Kennedy, president of the National Association of Affordable Housing Lenders. “Some insured institutions will continue to invest in, and provide services to, low- and moderate-income communities without a federal requirement -- but the question is whether even they will do so at the very same level, if community reinvestments and services are no longer required.”

Bank lobbies applauded the proposal, saying it would remove unnecessary burdens and allow them to “redeploy more resources toward their customers and communities,” said Dale Leighty, president and chairman of First National Bank of Las Animas, Colo., and chairman of the Independent Community Bankers of America.

The American Bankers Association, which includes banks large and small, said it was pleased that the FDIC was also proposing a broad definition of “community development” that the ABA said would benefit rural areas. The FDIC said banks that would be freed of stricter examination would still have a community-development performance standard, allowing them to choose between community-based lending, investment and service activities.

The current and proposed rules govern how small a bank must be to escape close scrutiny in examinations for compliance with the Community Reinvestment Act. “Small” banks are examined only for their record of making loans in the areas that they serve, while “large” banks undergo a stricter, more complex test of their patterns of providing service and investment in those areas.

Under current rules, “small” banks are those with assets of less than $250 million. In proposing to raise the threshold to $1 billion, the FDIC is following the lead of the Office of Thrift Supervision, which oversees the thrift institutions that were once called savings and loan associations. The Federal Reserve Board and the Comptroller of the Currency, which oversees national banks, have declined to raise their thresholds, citing potential adverse effects on rural areas.

In asking for public comment on the $1 billion threshold, the FDIC did not withdraw a Feb. 6 proposal, made with the other bank regulators, for a $500 million threshold. For more from the FDIC, go to:

FDIC data indicate that raising the threshold to $1 billion would reduce regulation on 1,655 of the 2,236 banks now subject to stricter examinations. That would include all those in Idaho and Wyoming, and all but one in Alaska, Montana and Vermont. Figures for some other states: 89 percent in Arkansas, Iowa and Minnesota (32 of 36 banks in each state), and between 80 and 87 percent in Colorado, Georgia, Illinois, Kansas, Kentucky, Louisiana, Missouri, North Carolina, Tennessee, Vermont, Virginia and Wisconsin. Kentucky’s figures are typical: 25 of the 30 “large” banks would become “small,” a reduction of 83 percent.

As reported here Monday, a study of Kentucky banks by researchers at Southern Illinois University-Edwardsville,, found that CRA requirements seem to increase lending and the money supply in rural communities.

Here’s a list of contacts on various sides of the issue: David Barr, FDIC, 202-898-6992; Heather McElrath, American Bankers Association, 202-663-5469,; Tim Cook, Independent Community Bankers of America, 202-659-8111; Jim Eberle, America’s Community Bankers, 202-857-3145,; Ross Kleinman, National Association of Affordable Housing Lenders, 202-293-9856; Tim Marema, Center for Rural Strategies, 865-494-7980,; Debby Ross, Rural Local Initiatives Support Corp., 202-739-9276,

Bush environmental policies get more media scrutiny

The phrase “mountaintop removal” evokes images of something that might be done by aliens with laser cannons in a science-fiction movie. But it is real, it is big, and it is getting bigger, thanks in part to regulatory changes by the Bush administration, according to a lengthy article by Joby Warrick in Tuesday’s Washington Post:

While there has been much coverage of this issue in national publications in recent years, including a New York Times story noted here last week, Warrick’s article is one of the most comprehensive to appear in a major newspaper outside the Appalachian coalfields, where the practice has turned mountaintops into mesas and buried more than 700 miles of waterways.

Mountaintop removal was specifically authorized by an eleventh-hour amendment to the Surface Mining Control and Reclamation Act of 1977, which otherwise required land stripped for coal to be restored to its approximate original contour. The practice began growing in the mid-1980s and accelerated in the 1990s, but was slowed by court action.

“Today, mountaintop removal is booming again, and the practice of dumping mining debris into streambeds is explicitly protected, thanks to a small wording change,” the Post reported. “Officials simply reclassified the debris from objectionable ‘waste’ to legally acceptable ‘fill’.”

Administration and industry officials say that change and others were needed to encourage coal production in order to make America less dependent on foreign oil for its energy. West Virginia’s top elected officials say the practice is necessary for continuation of the coal industry in the state, but a poll for “a West Virginia environmental group this year found that opponents of the practice outnumber supporters by 2 to 1,” the Post reported.

Yesterday, in Hedegesville, W.Va., in the state’s relatively prosperous Eastern Panhandle, supporters at a rally for Bush cited his religious faith, and gave him his strongest applause when he talked about social issues, the AP reported:

In the eye of the storm in Punta Gorda, Fla.

“I’ve got a paper, but I don’t have a town.”

That’s what Sherry Mearns, health editor of the Charlotte Sun-Herald, told herself and others after she and her husband, Business Editor Dan Mearns, drove around the Punta Gorda area after hurricane Charley hit.

They and their readers had a paper every day, thanks to printing assistance from papers in Bradenton and Venice. “We have printed through this whole thing, and that’s amazing to me,” Mearns told the Institute for Rural Journalism and Community Issues in a telephone interview. She said gathering news was sometimes difficult because police blocked access to hard-hit areas.

Readers of the Sun-Herald appreciated the effort to keep publishing, Executive Editor Jim Gouvellis told Elizabeth Carr of Poynter Online in a story published Monday: view.asp?id=70049

Gouvellis said some readers said they hugged their newspaper carriers when the Sun-Herald was delivered. “People are really thankful to receive their newspaper,” he said. The paper has a circulation of 35,000 with four zoned editions.

The paper, part of the Suncoast Media Group, plans to reserve about $1 million worth of free space for advertisers who are rebuilding or reopening, and will turn itself “into something akin to a community bulletin board where people can communicate with one another.” On the paper’s Web site., the first item is a “People Locator,” to help out-of-staters find relatives they haven’t been able to reach.

Mearns said the community has been well served by WCCF Radio, a Clear Channel station, which she said has operated even though its roof was blown off. We tried to reach the station, but their phone was constantly busy. Go figure.

The Institute for Rural Journalism and Community issues seeks to recognize good work in community journalism as part of its efforts to help non-metro media set the public agenda in their communities, grasp regional issues and interpret rural issues for national news media. Send your tips to Al Cross, interim director, at


Monday, Aug. 16, 2004

Our blog is for all rural journalists, and all journalists interested in rural issues, but it has a strong Appalachian flavor, because Central Appalachia is the initial focus of the Institute for Rural Journalism and Community Issues. Today, we’re all about Appalachia, in one way or another.

New appropriations chairman could come from Appalachia

The ( Louisville) Courier-Journal reported yesterday that a senior congressman from Appalachia, Rep. Harold “Hal” Rogers of Eastern Kentucky’s 5 th District, is in a race with Reps. Ralph Regula of Ohio and Jerry Lewis of California for chairman of the House Appropriations Committee, “one of the most powerful jobs in Washington.” Reporter James R. Carroll quoted Keith Ashdown, spokesman for the Washington-based Taxpayers for Common Sense, a government-spending watchdog group: “This will be a gold rush for whichever state gets it.”

University program explores Scots-Irish roots

Many newspapers used an Associated Press weekend story about the strong Scots-Irish legacy in Appalachia, as interpreted by the Center for Appalachian Studies at East Tennessee State University, The school’s summer program for Appalachian, Scottish and Irish studies has an exchange agreement with the University of Edinburgh in Scotland. The story highlighted such Scots-Irish contributions as whiskey making and language, including such expressions as “you all.” The reporter was Elizabeth Davis and the story was datelined from Norris, Tenn., and the Museum of Appalachia.

NYT: Horizon case shows need for change in bankruptcy law

The New York Times took note editorially today of last week’s court ruling allowing Horizon Natural Resources to sell six unionized mines without the obligation to provide health care and retirement benefits for more than 3,000 retired and active miners. “This cruel situation sounds like the stuff of another folk-song lament in Appalachia,” the editorial said. “But the bankruptcy judge, William Howard, found he was well within existing law and might even save jobs if the mines can be sold and kept open in some fashion. . . . The law clearly needs humane revision.”

Update: Study shows banking law helps some rural areas

We’re still waiting for mainstream media to pick up on the story, reported here a week ago, on relaxation of bank-examination rules under the Community Reinvestment Act. Here’s another source: A study by researchers at Southern Illinois University-Edwardsville,, found that CRA requirements seem to increase lending and the money supply in rural communities. However, the study, which used Kentucky as an example, failed to find “evidence of significantly increased local lending in economically distressed rural counties,” those in Appalachian Kentucky.

Friday, Aug. 13, 2004

New poet laureate is a voice for rural America: Retired insurance executive Ted Kooser of Lincoln, Neb., is America’s new poet laureate, an appointment from the Library of Congress. “Ted Kooser is a major poetic voice for rural and small town America and the first Poet Laureate chosen from the Great Plains,” Librarian James Billington said. “His verse reaches beyond his native region to touch on universal themes in accessible ways.” Kooser is the author of 10 books, the latest being Delights and Shadows, a collection of his works. He is a visiting professor of English at the University of Nebraska and is married to Kathleen Rutledge, editor of the Lincoln Journal Star.

Arkansas governor touts Bush in West Virginia: The rural focus of the presidential race returned to West Virginia yesterday, as Arkansas Gov. Mike Huckabee played surrogate for President Bush at three stops in the Mountain State. Mannix Porterfield of The (Beckley) Register-Herald writes that “ Huckabee touted President Bush as ‘consistent’ on moral and social matters Thursday, and rejected the belief of labor leaders that bread-and-butter issues are more important to West Virginia voters.” Huckabee said, "I think moral issues do matter to people in places like West Virginia and Arkansas.” But he also said Kerry’s election “would have a dramatically devastating impact on many of the industries that this state depends on for its livelihood." Noting the state’s unusual vote for a Republican presidential candidate in 2000, state Sen. Russ Weeks, R-Raleigh, told Huckabee, "God, guns and coal -- that's what did it the last time.”

Hospital fails in suit against paper for publishing peer review: A federal judge in Colorado dismissed a lawsuit last week in which a teaching hospital sought damages under the Health Insurance Portability and Accountability Act (HIPAA) after the Rocky Mountain News published excerpts of a peer review report. District Judge Walker Miller of Denver ruled Aug. 2 that HIPAA "displays no intent to create a private right of action" for the release of private health-related information. Rather, Miller held, HIPAA only regulates those "who might have access to individuals' health information." --Reporters Committee for Freedom of the Press, via SPJ Press Notes:

Virginia tries to keep obstetricians in rural areas: Virginia Gov. Mark Warner increased Medicaid payments for obstetric care 34 percent yesterday “in an effort to keep obstetricians practicing in rural and urban areas,” reports The Washington Post. “A scarcity of obstetricians has been particularly pronounced in rural areas, which often struggle to recruit and keep doctors, and where a higher percentage of patients are covered by Medicaid.” Virginia’s Medicaid reimbursement rates are low compared to other states. “In the past 18 months, four hospitals in rural parts of Virginia stopped delivering babies. . . . Some laboring mothers have driven hundreds of miles to give birth.”

New management plan for Cumberland Gap park: The Middlesboro Daily News reports that the National Park Service held three public meetings this week to hear from the neighbors of Cumberland Gap National Historical Park as the service prepares to draft a new management plan for the park, which lies at the junction of Kentucky, Tennessee and Virginia. The park’s current plan was written in the 1970s, before construction of the Cumberland Gap Tunnel and a commitment to acquire nearby Fern Lake and much of its watershed. Comments can also be submitted by phone to (606) 248-2817; by e-mail to; and by post to National Park Service, Cumberland Gap National Historical Park, P.O. Box 1848, Middlesboro, KY 40965, Attn: Mark Woods.

Wednesday, Aug. 11, 2004

The map of poverty: The rural South has the highest and most persistent rates of poverty, according to a new report from the Economic Research Service of the U.S. Department of Agriculture. The report includes a striking map of the nation's persistent poverty counties, and four major areas are evident: Central Appalachia, dominated by Eastern and Southern Kentucky; the Black Belt and Mississippi Delta; the Rio Grande Valley and the Southwest; and other areas with many Native Americans, primarily in Oklahoma, Montana and the Dakotas. The USDA defines a county as persistently poor if 20 percent or more of its population was poor in the last four censuses (1970-2000). Of the 386 persistent-poverty counties, 340 are rural, or outside standard metropolitan statistical areas, and 280 are in the South. Other findings: The poverty rate is highest, 16.8 percent, in counties that are not adjacent to metro areas, and counties with low employment rates are disproportionately located in the most rural areas.

Small-town media play a big role in the presidential campaign, as candidates make well-publicized stops and grant interviews in non-metro markets in the battleground states. The latest story on this phenomenon is from Jill Zuckman in Tuesday's Chicago Tribune. Some analysts told her that the local reporters' questions aren't as tough, but a former Bill Clinton operative said local interviews can be tricky because a candidate has to demonstrate familiarity with local concerns.

Bi-state city, bi-state political financier: John Gregory of Bristol, Tenn., has given an unprecedented $620,000 to four political action committees dedicated to electing Republicans to the state Legislature, and his family members have given at least $65,000 to the PACs, three of which have been created since the 2002 election, reports Tom Humphrey in today's Knoxville News-Sentinel. The story also relays this information from The Virginian-Pilot: Gregory, the retired CEO of King Pharmaceuticals of Bristol, has given more than anyone else, $325,000, to the gubernatorial campaign of Virginia Attorney General Jerry Kilgore.

Coal's comeback could be harming the health of people where it is burned, according to a story today in The Herald-Dispatch. Jean Tarbett, a staff writer for the Huntington, W.Va., newspaper, and Pamela Brogan of Gannett News Service draw on the "Dirty Air, Dirty Power" report issued in June by Clear the Air, a coalition of environmental, conservation and public-interest groups particularly concerned about mercury pollution from coal-fired power plants. The story quotes Janet Gellici, executive director of the American Coal Council, as saying "Coal is the least expensive fuel source, and is abundant and environmentally safe."

Banks and rural areas: Monday's item about changes in bank regulation affecting rural areas (see below if you're reading this on the Web) prompted a note from Heather McElrath at the American Bankers Association about it annual agricultural bankers convention, coming up in November. She says, "Registration is free for journalists and it's a great opportunity to get new sources." Topics at the conference will include "exploding land prices," rural-development initiatives, agricultural trade, critics of farm programs and "financing part-time and sundowner farmers." For more information, go to:

Monday, Aug. 9, 2004

Welcome to the Rural Blog (suggestions for another name are welcome). Your blogger is Al Cross, interim director of the Institute for Rural Journalism and Community Issues at the University of Kentucky. For more about the institute, click one of the buttons above.

This blog (short for “Web log”) will attempt to inform journalists and others about issues facing the 56 million Americans who live in rural areas, so the journalists can do a better job of helping their readers, viewers and listeners understand events and trends that affect their lives. It will hold up examples of good work to be emulated and issues to be examined. It will also provide a sounding board for issues among journalists and the public at large, first through e-mail to your blogger, and hopefully soon in a more interactive mode. My e-mail address is Please feel free to ask to be added to our listserv.

While the institute was created primarily to help rural journalists, it also exists to enhance broader understanding of issues facing rural America. One is access to money, and the possibility of new banking regulations that could have an effect on rural areas. That’s our feature item for this first edition, and appears in the bottom half.

Our blog won’t be daily for awhile, as we get our feet on the ground, but we hope to post some timely notices of news stories and commentaries that involve rural areas, such as Jeff Birnbaum’s “K Street Confidential” piece in today’s Washington Post about John Kerry and the National Rifle Association battling for votes of gun owners. Jeff suggests that the struggle could be pivotal: “In 2000, the NRA's aggressive electioneering probably cost Gore several rural states, any one of which could have sent him to the White House instead of retirement. . . . Gun owners make up a disproportionate share of the electorate in many of the states that are most contested, including Tennessee, Arkansas, West Virginia, Michigan, Minnesota, New Mexico, Nevada, Pennsylvania and Iowa.” The story is at:

Meanwhile, in a much longer article, Rich Oppel Jr. and Christopher Drew remind readers of The New York Times that the Bush administration has been friendly to coal, just as the leading eastern coal state was friendly to the president: “The president has also made good on a 2000 campaign pledge to ease environmental restrictions that industry officials said were threatening jobs in coal country. That promise led many West Virginia miners, who traditionally voted Democratic, to join coal operators in supporting Mr. Bush. It helped him win the state's five electoral votes, ultimately the margin of victory.” More at:

We will also be passing along tips for journalists, such as this last week from Mark Schaver, director of computer-assisted reporting at The ( Louisville) Courier-Journal, to his colleagues at the paper: “The Martin County slurry spill led Kentucky to begin posting maps of all Kentucky coal minesonline. Kentucky Techlines explains more.”

Appalachian issues

If we’re sounding a little mountainous (is that possible?), it’s no accident. This site is open to discussion of all matters facing rural America and the journalists who cover it, but we pay special attention to Central Appalachia, the pilot study area of the Institute for Rural Journalism and Community Issues.

The big news in Central Appalachia is that it is “A very good time to be selling coal,” as Lee Mueller of the Lexington Herald-Leader reported on Aug. 5. “In recent years, coal was selling for about $23 a ton,” Mueller wrote, then reported that the spot-market price for coal at the barge docks on the Big Sandy River “near Catlettsburg was $62 a ton, a $19 increase since January.” The story attributed the increase to a shrinking number of coal companies producing less coal at a time of higher demand, plus “shipping problems and bankruptcies by some of the region’s major Eastern Kentucky producers.” Gov. Ernie Fletcher, R-Ky., has cracked down on overweight coal trucks, reversing the attitude of his Democratic predecessor, Paul Patton, a former coal operator from the coalfield center of Pikeville.

This morning, Ken Ward Jr. of The Charleston Gazette reported that citizen groups want federal inspections of strip mines where they think operators may be violating a federal judge’s order, which required individual permit reviews for valley fills and suspending permits on which fill construction had not begun by July 8. Here’s a link to the story:

Bank rule changes could affect rural areas

Advocates for investment in rural areas and inner cities are worried that changes in federal rules could mean that banks will make less money available for loans and other purposes in such areas. This a story with national, regional, state and local angles.

The rules govern how small a bank must be to escape close scrutiny in examinations for compliance with the Community Reinvestment Act. “Small” banks are examined only for their record of making loans in the areas that they serve, while “large” banks undergo a stricter, more complex test of their patterns of providing service and investment in those areas. Banks say the rules under the Community Reinvestment Act are too costly and thus inhibit investment.

Until last month, all three major federal bank regulators used the same threshold for large banks, $250 million. When they disagreed on whether to raise the threshold to $500 million, the Office of Thrift Supervision, which oversees the thrift institutions that were once called savings and loan associations, raised its threshold to $1 billion. The Federal Reserve Board and the Comptroller of the Currency, which had favored raising the threshold to $500 million, withdrew those proposals. The Fed said the reduction in community-development capital in rural areas was uncertain, but “potentially large in at least some communities. On balance, the board does not believe that the cost savings of the proposal clearly justify the potential adverse effects on certain rural communities,” the Fed said.

The OTS said it endorsed the $1 billion figure partly because thrift institutions have higher compliance costs as part of anti-terrorism efforts. John Taylor, president of the National Community Reinvestment Coalition, replied, “Fallout from the war on terrorism should not make a victim of the American consumer. When you get less frequent and less rigorous exams, you get less lending, which means the consumer gets less access to credit.” Taylor was quoted in Regulatory Risk Monitor, a newsletter for banking compliance officers.

Now the focus is on the Federal Deposit Insurance Corp., which regulates most small banks. Regulatory Risk Monitor said many observers expect the FDIC to follow the lead of OTS and adopt the $1 billion threshold. Banks’ allies in Congress are calling for uniformity in regulation. “We are once again creating an uneven playing field that competitively weakens small and independent community banks. It is particularly ironic that regulators continue to disadvantage our rural and small-town banks, when they are community re-investors in the truest sense of the word,” said Rep. Spencer Bacchus, R-Ala., chairman of the House Financial Institutions and Consumer Credit Subcommittee.

If the FDIC follows suit, 74 percent of the banks now considered “large” by FDIC would be considered “small,” according to an analysis of FDIC data by the Center for Rural Strategies, based in Whitesburg, Ky. That would include all those in Idaho and Wyoming, 92 percent in Maine and Montana, 89 percent in Arkansas, Iowa and Minnesota, and between 80 and 87 percent in Colorado, Georgia, Illinois, Kansas, Kentucky, Louisiana, Missouri, North Carolina, Tennessee, Vermont, Virginia and Wisconsin. Kentucky’s figures are typical: 25 of the 30 “large” banks would become “small,” a reduction of 83 percent.

Even if the FDIC does not raise its threshold, members of Congress are discussing legislation to raise it. Either way, that spells trouble for rural areas and inner cities where some banks have considered investment relatively risky, say supporters of the current threshold. “It’s a bad thing if the OTS goes along with this. It’s an awful thing if the FDIC goes along,” Judy Kennedy, president of the National Association of Affordable Housing Lenders, told American Banker magazine. Kennedy’s testimony before Bacchus’s committee and state-by-state statistics are available on her organization’s Web site, Likewise, the American Bankers Association’s committee testimony is available on its site,


Heather McElrath, American Bankers Association, 202-663-5469,

Judy Kennedy, National Association of Affordable Housing Lenders, 202-293-9850

Tim Marema, Center for Rural Strategies, 865-494-7980,

Debby Ross, Rural Local Initiatives Support Corp., 202-739-9276,



The Institute for Rural Journalism and Community Issues has had several meetings to plan the Institute and to further promote its mission. Links below provide information on the details and discussions of meetings since the IRJCI was officially established in Fall 2002.




Institute for Rural Journalism & Community Issues

University of Kentucky
School of Journalism and Telecommunications

122 Grehan Building, Lexington, KY 40506-0042

Phone: (859) 257-3744, Fax: (859) 323-9879

Al Cross, interim director ,

Last Updated: October 31, 2002