The Rural Center: The Wrong Kind of Politics

If a group of politicians were setting out to build themselves an empire, it’d be helpful for them to have two things: Plenty of taxpayer money available to pass out to make new friends, and a high-sounding name for their endeavor – which, according to the News and Observer, is about exactly what happened twenty-six years ago when Democrats in the General Assembly created The Rural Center.

With Republican Jim Martin in the Governor’s Mansion, Democrats leading the General Assembly decided, instead of letting Martin get credit for handing out checks for ‘Economic Development Grants,’ they’d set up a legislatively controlled nonprofit and pass out the taxpayers’ money themselves. Then, adding a layer of political camouflage to what was an old-fashioned pork barrel fund, they proclaimed their group had a noble mission – to create jobs in rural areas – and named it The Rural Center.

Before long it was up and running – headed by CEO Billy Ray Hall – and what happened next worked like this:

  • Democratic legislators voted to send millions in taxpayer dollars to the The Rural Center.
  • Over at The Rural Center, Billy Ray Hall paid close attention to the wishes of legislators when he gave out ‘grants’
  • The cycle repeated over and over.

Billy Ray Hall had the best and arguably one of the most powerful jobs in state government – giving away money, which helped generate a lot of friends. Since its inception, The Rural Center and Mr. Hall have given away tens of millions of dollars in grants at the request of NC Senators and NC Representatives.

The process worked so well that even after Republican Governor Martin handed the Governor’s Mansion keys to Democrat Jim Hunt, the Democrats running the General Assembly saw no reason for change. Better yet, it became a model for more ways to help their friends using more economic development funds like The Golden Leaf Foundation and The Clean Water Management Trust Fund.

Over the years, in the name of creating jobs in rural communities, The Rural Center poured $24 million in grants to the center of non-ruralness, Wake County.

It poured millions into highly profitable companies that didn’t need help – like Walmart which benefited from $6 million in Rural Center grants. Grants even included a golf course near Southern Pines and a video sweepstakes company in Greenville.

The News & Observer illustrated the mechanism by including the tale of one legislator that helped arrange a $300,000 Rural Center grant for a project in his district. The project did not strictly comply with Mr. Hall’s existing rules but those rules were bent and the grant was made and, according to the newspaper, the legislator raised $6,500 in campaign donations from partners in the development.

It all rolled along fine for over two decades as an example of good ole boy politics and pork barrel spending at its best until a stroke of bad luck landed Billy Ray Hall on the front page of the News and Observer in an exposé headlined, “Politicians, powerful touch NC Rural Center cash.”

To give Hall credit, he tried to make the best of a bad situation, dressing up decades of pork barrel spending as dedication to helping rural North Carolina – as Hall told the News and Observer, “I eat, sleep, and breathe rural North Carolina.”

But the bottom line is simpler: The Rural Center is living proof pork barrel spending isn’t the best way to create jobs in rural areas.

Now that the News and Observer’s story has put the program in front of us, this looks like a good time to end this particular pork barrel right now and take the Rural Center’s $170 million in state funds which, unlike other state agencies, are in its own account and not controlled by the NC Treasury.

The Governor, in his budget, proposed cutting The Rural Center’s funding 60% this year – giving it another $6 million. The Senate then cut the funding to zero. The State House went in the other direction, increasing the center’s funding by $36 million over two years.

There’s no doubt rural communities have very real needs and some legislators are concerned eliminating The Rural Center will leave rural communities short of friends. But pork barrel politics is not the answer to the challenges facing rural North Carolina. Let’s get the good ole boy politics and pork-barreling out of the way – then we can work on fixing the real problems.

It’s time for Republicans to shut down The Rural Center.

Leave a Reply