Republican and Democratic lawmakers in the Senate and House have teamed up to introduce bipartisan legislation to expand tax-exempt cooperative organizations’ access to government grants and assistance, including rural broadband internet grants and FEMA disaster relief.
Sen. Rob Portman, R-Ohio, and Tina Smith, D-Minn., introduced the Revitalizing Underdeveloped Rural Areas and Lands (RURAL) Act on Thursday to encourage infrastructure development in rural areas by expanding tax-exempt cooperative organizations’ access to government grants and assistance, including rural broadband grants and FEMA disaster relief. Rep. Terri Sewell, D-Ala., and Adrian Smith, R-Neb., are introducing a companion measure in the House.
This legislation offers greater certainty for rural co-ops that want to use government resources to provide critical services to their members, including wider access to high-speed internet or repairs to the electrical grid. The RURAL Act would amend the tax code to help tax-exempt cooperative organizations avoid losing their tax-exempt status when they use certain government grants, contributions and assistance, including rural broadband grants and FEMA disaster relief.
“In today’s technology-dependent world, we must do more to bring high-speed internet and stronger grid infrastructure to the rural areas of our country,” Portman said in a statement. “Tax-exempt rural co-ops provide these important services to parts of the country where access to reliable electricity and high-speed internet is the most limited, and they rely heavily on grants to perform these services.”
He noted that without such legislation, many co-ops could miss out on grant income or disaster assistance, harming efforts to promote more economic development and job creation in rural areas.
“We should take any action we can to help us get more Minnesotans and Americans in rural areas connected,” Smith stated. “So when I heard from several Minnesota cooperatives at risk of losing their tax-exempt status, I wanted to reverse that. This bipartisan legislation would ensure that co-ops can retain their tax exemptions in efforts to expand rural broadband or in providing relief from, or preparation for, a disaster or emergency. I’m encouraged that this bill has bipartisan support as well in the House, and I’ll be pushing for this legislation to become law so we can make sure rural broadband keeps expanding.”
