Anne Kubisch speaks about rural challenges

December 14, 2015: At the 2015 Oregon Leadership Summit in Portland, Anne Kubisch, president of The Ford Family Foundation, talked about the challenges facing rural Oregon: declining timber revenues, lack of public services and small business retention and expansion. She also talked about how Oregon's rural areas are held together by incredible civic engagement and love of community.

Watch the 8-minute video of Anne's interview, or read her notes below.

Question: The Ford Family Foundation has as its mission “vital rural communities.” Tell us what trends you are seeing regarding “vitality” at the community level in rural Oregon?

We have a connection with almost every rural community in Oregon, through our grant-making program, our scholarship awards, and the leadership development program that we have run in partnership with Rural Development Initiatives (RDI).   We travel throughout the rural parts of the state and are constantly astonished by the how these communities are held together by incredible civic engagement and love of community. But it’s not easy to make a living in rural.  There are the things that we have always known and remain constant:

• Sparse distribution of communities means it's hard to get economies of scale.
• There’s a lack of basic infrastructure, including roads (long distances) and broadband that constrain economic development.
• There just aren’t that many people! The amazing local leaders serve in multiple ways and wear many hats — football coach, city councilor, small business owner, Future Farmers of America volunteer, and so on. The capacity for community change and development is stretched thin.  

Then, on top of that, we have recent economic trends that have made things even harder.  As we all know, rural Oregon is a natural resource-based economy and several trends have affected it:

• Globalization of the food market, e.g., orchard producers are now competing in a global market and have trouble competing and getting top dollar.
• Regulation of federal forestland combined with improved technologies has meant dramatically declining timber earnings. In Douglas County, a generation ago, timber accounted for 45% of jobs; today it’s 11%. And nothing has taken its place.

Question: In what ways are these trends having an impact on rural communities today?

Increases in poverty

• Poverty rates in rural Oregon have always been higher than urban, but the difference is growing — not shrinking.
• A lot of this has to do with the restructuring of the rural economy that has bifurcated the labor force – with a loss of the high-paying jobs in places like timber mills that didn’t require a college degree. And they’re being replaced by service jobs with minimum wage jobs. By the way, this is where urban and rural have common cause.

Accompanying social problems

• Poor urban areas have lots of experience with the social and family consequences of concentrated poverty, and so we’ve learned what to look out for.  In poor rural communities, we are seeing growing problems of family stress, substance abuse, and mental health that make it hard for teachers to teach, for adults to maintain jobs, and for families to succeed. 
• Out-migration of young people and talent (with exception of high-amenity areas such as around Bend).

Declining public tax receipts to fund key services

The restructuring of the rural economy has meant declining public revenues to fund everything from public safety to public health to public libraries. Let me give the example of Douglas County:  

• In 2014, a revenue crunch led our county commissioners to decide that they could no longer be the provider of public health and mental health services. So one year ago, they divested the county of mental health and worked on creating a nonprofit to deliver the mental-health services at a lower cost. So, when the mass shooting took place on the Umpqua Community College Campus on October 1, this fledgling, underdeveloped and understaffed organization did everything it could. It was all we had in place.  The lack of pre-existing services for routine mental health problems was bad enough. Then we were faced by a horrific crisis, and we had very little capacity to respond.   
• Since 2007, the Douglas County Library system budget has been reduced from its typical budget of $2.4M to $1.1M this year. One year from now, the 11 libraries in the county will be shuttered — unless the voters approve a special taxing district on the November 2016 ballot. Our neighboring county, Josephine, did not succeed in getting this ballot passed.

Question: What do you see as promising strategies to increase local community economic development vitality in rural Oregon?

Support retention and expansion of existing local businesses. Don’t lose what we’ve got. Local businesses hire locally. Business recruitment strategies may seem attractive, but they are high risk and they come at a high price that most of our rural communities cannot afford. Ways to help retain and expand rural businesses:

• Support small business advisory and technical assistance capacity (small business development centers, entrepreneurship classes)
• Provide financing that matches the needs of rural businesses (community development financial institutions, Community Public Offerings, local angel investors)
• Assist with generational succession planning for locally owned rural businesses
• There’s the general rule about the rural-to-urban ratio of the impact of job generation that is 1:100: Every job that’s generated in a rural area has the impact of 100 jobs created in an urban area. 

Explore and build the new natural resource economy

• Forest collaboratives: These are local community groups that are able to overcome the state-level and national-level polarized debate between environmental objectives and economic development objectives. They find locally agreed-upon ways to manage forests that are both environmentally and economically sustainable. The lesson here is that local communities are always in search of pragmatic solutions to their problems. For example, I want to applaud two fabulous organizations, Wallowa Resources and Sustainable Northwest, for modeling these approaches and efforts.
• Other sectors that can fuel the new natural resources economy include: watershed restoration and habitat restoration, alternative energy, and wine

Capture more wealth locally with value chain development

• Local food processing to capture more wealth from the value chain or storage to manage commodity price fluctuations, for example: establish local fish processing capacity in Port Orford, or support malting barley production in Eastern Oregon to support the growing local craft brewing industry. 
• Source locally produced foods in commercial centers or large rural institutions (such as schools and medical institutions)