USDA Rural Development RD

In 1935 roughly nine in ten American farms had no electricity. President Franklin Roosevelt created the Rural Electrification Administration by executive order on May 11, 1935, and the Rural Electrification Act of 1936 let it make low-cost loans to farmer-owned electric cooperatives, many of which still serve rural America. Rural housing lending grew out of the Farmers Home Administration. The 1994 USDA reorganization gathered these functions into the Rural Development mission area, led by an Under Secretary.

Rural Development works through three agencies. The Rural Utilities Service lends for electric, water, sewer, telephone, and broadband systems, including the ReConnect broadband program begun in 2018. The Rural Housing Service makes and guarantees home loans, including mortgages with no down payment for low- and moderate-income buyers in eligible areas, and finances rural rental housing and community facilities such as clinics and fire stations. The Rural Business-Cooperative Service backs loans to rural businesses and cooperatives.

Its loan portfolio runs to well over two hundred billion dollars, much of it in electric cooperative and housing loans. Supporters say its programs fill gaps that private lenders and other federal agencies leave in sparsely populated areas, while critics point to overlap with other broadband and housing programs and to loans that reach places that are not especially rural. Its field offices were affected by the 2025 federal workforce reductions.