Legg sees vital role for utility
co-ops in rural America’s future
By Steve Thompson
USDA Rural Development
sathomps@rdmail.rural.usda.gov
ilda Gay Legg, Administrator
of USDA Rural
Development’s Rural
Utilities Service (RUS),
has worked in a number
of capacities to promote development
in rural areas. A native of rural Adair
County, Ky., she served as executive
director and CEO of the Center for
Rural Development in Somerset, Ky.,
from 1994 until her appointment as
RUS administrator in October 2001.
In that position, she helped develop
and implement a broadband telecommunications
program in rural communities
throughout southern and eastern
Kentucky.
From 1990 to 1993, Legg served as
alternate federal co-chairman for the
Appalachian Regional Commission in
Washington, D.C. There she represented
and promoted economic policies
and assisted in the management
of a $190 million budget for job creation,
building infrastructure, education
and workforce training, as well as
research programs for economic
development.
Legg has also served as a field representative
for Kentucky Senator Mitch
McConnell, as acting executive director
of the National Council on the
Handicapped and as the director of
admissions for Lindsey Wilson College
in Columbia, Ky.
Legg believes that access to highspeed,
broadband communications service
is vital to the future growth and
prosperity of rural America. She talked
with “Rural Cooperatives” magazine
about the promise of broadband and the
challenge of promoting rural economic
development in the 21st Century.
Rural Cooperatives: It has been estimated
that the cost of providing rural
America with broadband communications
would be in the neighborhood of $14 billion.
Can we afford that cost?
Legg: I think a better question is,
can we afford not to have broadband in
rural America. Rural communities will
always face a big challenge in competing
economically with urban areas.
They need to have competitive infrastructure
both to attract companies
from outside and to encourage the
development of locally-owned businesses.
And that leads us to what I call
the Three “A’s” of technology:
1. Communities have to be aware of
what new technology, such as high-speed
internet connections, can do for them.
2. They have to have access to it. And
that leads to:
3. Application applying the technology
constructively.
My job at the Center for Rural
Development was dealing with the first
two requirements. We established and
managed 40 World Wide Web conference
sites in eastern Kentucky, in small
towns and villages of 1,000 to 5,000
people, occasionally more. The sites
offered high-speed, interactive video
conferencing and community access
computers to all comers.
The way the sites were used gave
us a glimpse of the possibilities this
technology offers people living in rural
areas. In one town, we had an
elderly gentleman who would bicycle
over from his home every day and
spend an hour or so surfing the Web.
Another user was a lady who used the
computers to communicate through
e-mail with her grandson in the army
overseas. A local hospital rented the
video-conferencing facility to hold
management meetings with its sister
hospital in another part of the state.
And a life-insurance agent used the
conferencing services to simultaneously
keep in touch with her district
office in Lexington and her corporate
office in Colorado.
This is only the tip of the iceberg,
because rural people may not yet be
aware of what this technology offers
them in their private lives and in making
their living. I think it will take a little
time, but I have no doubt that in the
future the way we do business will
depend on broadband.
That brings up the question: just what
does broadband offer rural areas? Can it help
them entice a corporation to bring in jobs?
The thing to remember is that
before corporations decide to locate in
a rural area, they’re going to make sure
they have access to the same kind of
infrastructure and services they can get
in an urban area, not just for doing
business, but also for the sake of their
employees. That includes fast computer
communications, and, just as important,
the other resources to which broadband
gives access, that otherwise might not
be available outside the cities.
Bringing a big corporate facility to
your rural area can be important. In Kentucky,
we’ve made big efforts using tools
such as tax credits to bring in big facilities,
like a Toyota assembly plant to Georgetown.
So broadband isn’t the only reason
any company will want to locate to your
area: they’re going to look at the whole
package.
But we’ve also had successes because
of access. For example, Amazon.com
has a communications center coming
to Campbellsville, where infrastructure
in place was a big factor.
We have to remember that small
operations, such as call centers and local
small businesses are important, too. Four
or five jobs added to an existing business
because of expansion does not seem like
a big deal. But in the long run, this type
of growth is more sustainable and may
be more realistic to building the community
than hitting the home run, like
the Toyota plant or Amazon.com.
By connecting people and computers
in different locations, the new technology
has the potential to help rural
businesses achieve economies of scale
that allow them to compete on an equal
footing with businesses located in the
cities. And it also offers incentives to
people who might want to return home
after living in the city. They’re going to
want the conveniences and advantages
they’ve gotten used to, from not having
to depend on a slow dial-up connection,
to convenient banking all sorts
of things broadband makes possible.
A good case in point is telemedicine
and distance learning, which use video
conferencing to put medical specialists in
remote clinics and operating rooms, and
teachers in specialized subjects in remote
classrooms. Using these technologies
you can have access to the same level of
medical care and the same education
curriculum you could find in the city.
RUS is actively promoting its new Distance
Learning/Telemedicine (DLT) program,
but it has met resistance in some
areas. Would you care to comment?
We’re making loans, but not as
many as we’d like. I think it’s going to
take time for the telemedicine technology
to be fully accepted, and there are
a number of reasons. The first is that
the clinics that can most use telemedicine
are the ones that are in the most
remote, least developed areas. Unfortunately,
they’re also often the ones
with the least ability to pay the costs of
installation and hook-up.
There’s also a cultural problem. People
just don’t want remote doctors;
they’re used to dealing with a physician
face-to-face, and they’d rather travel
miles out of their way than to be examined
over a remote hook-up. It will take
awhile to get used to this new technology,
just as it took awhile to get used to
the telephone and other innovations.
There are other problems, too, such
as: when you have a remote doctor and a
doctor on the spot both helping a
patient, which one does the billing?
How is the fee split? We have no precedents
yet for those issues, and they’ll
have to be worked out.
Distance learning presents some special
problems, too. For instance, we
have a college in rural Kentucky that’s
linked to one in southern Tennessee and
a tribal college out West. They share a
language teacher, but the colleges are
located in the jurisdictions of different
accrediting bodies. So how do they
resolve the accreditation issue? New
technology always poses challenges to
existing systems, and the people who are
in charge of those systems aren’t used to
it and need to learn how to deal with it.
When you get enough colleges
demanding the resolution of the accreditation
issue, it will get resolved, and the
other problems will, too. The culture
has to change to adapt itself to new
technology, but it takes time. In the
meantime, we often have to go out of
our way to find the most isolated, hungriest
doctor to get someone who is
willing to take the risk of adopting the
new technology.
In an emergency, the DLT technology
really proves its worth. A rural
clinic with a surgeon who isn’t experienced
in a specific type of surgery
could with a telemedicine set-up be
guided through a surgical process by a
specialist at a large hospital.
The great thing about this technology
is that, in a situation like that, the
camera provides a sharp, close-up view
for the remote physician that is actually
superior to what the doctor on the spot
can get using his own unaided vision.
For all practical purposes the remote
doctor is right at his elbow, guiding
him through the procedure.
As long as we’re talking about development
in rural areas, what do you think
utility co-ops can do to encourage economic
growth in the areas they serve?
There’s a lot utility co-ops can do,
and many of them are playing important
roles in improving the quality of life for
their members. For instance, many coops
maintain local community centers.
Putting conference centers in those facilities
is one example of what they can do.
But more important is that co-ops
should be leaders in their communities.
They need to recognize, as many do,
that their obligations to their members
do not end with simply providing utility
service, whether it’s telecommunications,
power or water and waste disposal.
They need to work actively to grow
their local economies. They need to
embrace change. They need to be part
of the active recruitment of businesses,
and to share their business and financial
expertise with their members and
potential members. The revolving loan
funds and business incubators that
many rural utilities co-ops are setting
up are good examples of this approach.
Utility co-ops, by their very nature,
have a lot to offer. Unlike political
leadership, they’re around for the long
term, and they have a vital stake in the
economic health of their service areas.
They have lots of experience and
expertise in finance and business, and
often have the financial resources to
invest in development projects. And I
have to say that I have been very
impressed by the dedication and professionalism
of the co-op board members
and managers I have met.
What direction would you like to see
RUS and USDA Rural Development take?
I’d like to see RUS and Rural Development
take a more synergistic approach
to their mission. By that, I mean that
their should be more coordination
between the agencies to most effectively
use our resources. At the state level, this
is already happening, because the
employees of the different agencies work
next to each other under the same state
director. But I think that at the national
level, here in Washington, we need to
work on building more team efforts.
For instance, if we’re making a
telecommunications loan in a certain
area, could we multiply its impact with a
complementary project funded by a Rural
Business Enterprise Grant, or perhaps
a Rural Business-Cooperative Service
loan? What about housing or community
facilities loans is there a way these
might fit in? I think we should think
about how the different agencies can
collaborate, and perhaps set a goal of
coordinating broadband loans and other
assistance in ten separate rural areas.
That would be a good start.
I also think we need to make sure
our field people are well-educated in
what the new technologies offer rural
areas and how to best take advantage of
it in the areas they serve. We need to
offer them training that will equip
them to embrace change and make it
work for their customers.
But in the end, development in a rural
area depends on the people who live
and work there. It doesn’t matter how
much federal help you get; if you don’t
have local investment, local involvement
and local leadership, you’re not going to
get results. Communities have to decide
where they want to go, remembering
that jobs are the key everything else
follows. Do they want manufacturing?
Do they want to go in another direction?
What kind of advantages does
your community have that can help you
achieve your objectives? How do you
use those advantages? People from outside
can’t make those decisions. That’s
where I think the leadership of co-ops,
and not just utility co-ops, can make a
big difference.
People have to remember, that
development is an ongoing process, and
rural areas are always going to have to
work harder at it. Also, there are always
going to be setbacks, due to market
changes and the volatility of corporate
business. When you go out to entice
companies to locate in your community,
or encourage local business start-ups
and expansions, you’re going to have a
lot of disappointments. Your community
leaders have to have tenacity, and the
individual members of your community
have to have a sense of power. They
can’t be passive; they can’t count on
someone else, whether it’s a company
or a government agency, to make it
work. They have to take an active part
in the development effort.
