Rural Electrification Administration

An REA lineman at work in Hayti, Missouri in 1942.

The Rural Utilities Service (RUS) is an agency of the United States Department of Agriculture (USDA), one of the federal executive departments of the United States government charged with providing public utilities (electricity, telephone, water, sewer) to rural areas in the United States via public-private partnerships. The agency's acronym is an allusion to the Latin word rus ("countryside"), the etymological source of the word rural^{[citation needed]}.

History, structure, and programs

The RUS is one of three agencies (the other two are Rural Business-Cooperative Service and the Rural Housing Service) that are part of the USDA's Rural Development Bureau. The three agencies are headed by administrators, who each report to the Under Secretary of Agriculture for Rural Development. (The RUS administrator is the only one of the three who is Senate-confirmed).

The RUS administrator makes the primary policy and program decisions for the agency and is assisted by a borrower and program support staff that includes a financial services staff, an administrative liaison staff, and a program accounting services division. Because of the financial nature of the agency's work, the administrator and associated staff work closely with two other agencies that are not part of the USDA, the Federal Financing Bank (FFB) and the Rural Telephone Bank (RTB). These banks provide the funds for many of the loan programs administered by the RUS.

The program functions of the RUS are divided among three operating units: water and waste, electric, and telecommunications, each led by an assistant administrator. The administrator and staff concentrate on the financial details of individual RUS projects, and these three operating units provide the engineering and technical personnel to plan and execute projects.

History

RUS traces its roots to the Rural Electrification Administration (REA), one of the New Deal agencies created under President Franklin Delano Roosevelt. The REA was created on May 11, 1935 with the primary goal of promoting rural electrification.^[1] In the 1930s, the U.S. lagged significantly behind Europe in providing electricity to rural areas due to the unwillingness of power companies to serve farmsteads.

Private electric utilities argued that the government had no right to compete with or regulate private enterprise, despite many of these utilities having refused to extend their lines to rural areas, claiming lack of profitability. Since private power companies set rural rates four times as high as city rates, this was a self-fulfilling prophecy.^[2] Under the REA there was no direct government competition to private enterprise. Instead, REA made loans available to local electrification cooperatives, which operated lines and distributed electricity.

By 1939, the REA served 288,000 households, prompting private business to extend service into the countryside and to lower rates. Harry A. Slattery was the administrator (head of REA) from 1939-1944, when he resigned after a conflict with the Secretary of Agriculture.

By the end of the decade, 90 percent of rural homes had power, up from around 10 percent in 1930^{[citation needed]}. From 1949, the REA could also provide assistance to co-operative telephone companies^{[citation needed]}.

The reorganization of REA into RUS was authorized by the Federal Crop Insurance Reform and Department of Agriculture Reorganization Act of 1994 (P.L.103-354).

Related federal legislation

• 1944: Rural Electrification Act Amendments PL 78-425, 78-563
• 1949: Rural Electrification Act Amendments PL 81-423
• 1961: Area Redevelopment Act PL 87-27
• 1961: Housing Act PL 87-90
• 1962: Rural Electrification Act Amendments PL 87-862
• 1965: Appalachian Regional Development Act PL 89-4
• 1965: Department of Housing and Urban Development PL 89-174
• 1966: Demonstration Cities and Metropolitan Development Act PL 89-754
• 1972: Rural Development Act PL 92-419

Notes

1. ^ History of Coops
2. ^ McChesney, Robert and John Podesta. "Let There Be Wi-Fi." Washington Monthly, January/February 2006. Accessed 30 July 2008.

External links

• Media related to Rural Electrification Administration at Wikimedia Commons
• Article on the REA from EH.NET's Encyclopedia
• "Rural Development Utilities Programs". http://www.usda.gov/rus/. Retrieved on 2005-11-23. 

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