A suspension of federal loans and grants is causing distress among rural business owners across the United States, particularly those who are anxious about not receiving reimbursement for sustainable irrigation systems or solar installations they acquired under promises of financial aid.
In Cherryville, Maine, Hugh Lassen and his family operate Intervale Farm, dedicated to growing organic wild blueberries. Last year, they invested in solar panels to power their home, blueberry sorting equipment, and 14 freezers, anticipating an $8,000 grant from the Rural Energy for America Program (REAP).
“It’s never an easy decision to spend $25,700,” Lassen expressed. “For a small operation like ours, that’s a considerable financial strain, and with impending college costs, it’s quite daunting.”
Despite President Donald Trump’s directive to freeze such funding, federal judges have indicated that agencies can still distribute these funds, yet many have yet to resume payments. This has left business owners in limbo after dedicating time and resources to enhance their operations with the aid of these grants.
“We’ll have to manage if the funding ultimately does not come through,” Lassen lamented.
REAP, which is facilitated by the U.S. Department of Agriculture, is just one of numerous programs affected by the funding halt. This initiative aims to provide financial assistance to small businesses in rural locales to help them generate clean energy or boost energy efficiency. Beyond solar power, it has also funded wind turbines, electric irrigation systems to replace diesel-powered ones, and corn ethanol projects.
After a business secures REAP approval, it proceeds with the equipment purchase and must operate it for at least 30 days before a USDA official comes to verify its function. If all is verified, the reimbursement check is typically issued.
Some applicants have spent extensive time working on their funding requests. Deanna and Christopher Boettcher, who manage Mar Vista Farm and Cottages located in Gualala, California, began their REAP application process early in 2023. They devoted time collaborating with contractors and filling out documentation for a solar panel system designed to supply approximately 80% of their electricity needs.
However, on the very day they received approval to purchase the solar panels, the funding freeze was declared.
“I am at a loss for words,” Deanna Boettcher remarked, regarding the unexpected halt. “This development is bound to alter our plans. We cannot feasibly move forward with our solar project without these funds … It feels like an endless maze of barriers; to finally reach a solution only to encounter this setback is disheartening.”
The cost of their solar installation amounted to $82,600, with REAP expected to cover half of that amount. “We won’t consider starting the project until we are certain that the funding freeze has been lifted … Essentially, we find ourselves back where we were two years ago.”
Lassen emphasized that adopting renewable energy sources reduces operational costs for the farm, which translates to lower prices for their products. Solar and wind energy are particularly attractive to isolated rural communities due to their potential savings compared to traditional energy options like diesel generators and irrigation pumps.
Grants have historically played a pivotal role in launching renewable energy initiatives in rural regions, as they help lessen the financial burden.
The Trump administration’s stance has been that the government should reduce its involvement in the energy sector, favoring fossil fuels instead of renewable sources. Trump has frequently expressed his preference for oil and gas, aiming to dismantle environmental policies established by the Biden administration. His advisor, Elon Musk, has advocated eliminating all federal tax credits and subsidies for renewable energy.
Russell Vought, the newly appointed White House budget director, co-authored Project 2025, a conservative agenda that criticized renewable energy systems while promoting further investment in oil and gas. According to a statement from a department representative, USDA officials have been instructed to evaluate whether grants, loans, and contracts align with new administration goals, and newly nominated USDA Secretary Brooke Rollins is expected to collaborate with the White House about these programs once confirmed.
The Lassens have installed a Tesla inverter as part of their solar setup, designed to convert the direct current generated by solar panels into alternating current for use in their home. Hugh observes this situation puts them in a challenging position, where they may be impacted by Musk’s aggressive cost-cutting measures despite the advantages of renewable energy technology.
“Farmers and small enterprises across Appalachia and rural America are wrestling to maintain viability,” remarked Chelsea Barnes, who leads government affairs and strategy for Appalachian Voices, a nonprofit organization that advocates for sustainable practices. She noted that for those who have received REAP funding, purchased equipment but not yet received reimbursement, “the financial damage could be considerable.”
REAP was established in the 2002 Farm Bill and has been historically supported across party lines for its role in promoting energy independence, drawing funds from farm legislation and the Inflation Reduction Act. Since its inception, the program has awarded around $2.4 billion, with approximately half of that funding coming during the Biden administration’s tenure.
“It is counterproductive to target a program that significantly aids farmers in lowering their operating costs. This approach garners broad agreement, especially since it predominantly serves Republican constituencies,” expressed Andy Olsen, a senior policy advocate with the Environmental Law and Policy Center.
