A Brief History
The following is a brief history of America's Rural Rehabilitation Corporations and
the Founding of the National Association of Rural Rehabilitation Corporations
taken from the State-to-State Awareness Notebooks. This information is available in its original format in a Word Document for saving and printing.
A Brief History of America's Rural Rehabilitation Corporations and
A Brief History of the Founding of the National Association of Rural Rehabilitation Corporations
Edited/revised by the Florida Rural Rehabilitation Corporation and includes the mission statement adopted at 1997 Annual Meeting in Orlando, Florida
Updated by the NARRC Secretary/Treasurer – October, 2010
A Brief History of America's Rural Rehabilitation Corporations
Compiled by Leland Beatty, General Manager (Texas Rural Communities, Inc.)
When Congress convened in 1933, the first order of business was to work with the new Roosevelt administration
to craft a program which would aid the millions of Americans displaced by the Great Depression.
At that time, the federal bureaucracy was small and largely concerned with minor industry regulations,
complicating this task to a degree we cannot understand today. Before 1933, the federal government had
responded to the economic crisis only with offers of loans to state governments which had historically
shouldered the responsibility for the welfare of the citizens.
An innovative approach adopted by the 1933 Congress was contained in the Federal Emergency
Relief Act of 1933. Rejecting proposals to create new federal bureaucracies to provide
assistance to the masses as simply too slow, Congress approved a joint federal-state relief effort.
An appropriation of $500 million was set aside for the relief effort, with $250 million of that
money designated for use by the states.
This money, according to the Federal Emergency Relief Act, was to be used “to make grants to
the several states to aid in meeting the costs of furnishing relief and in relieving the
hardship and suffering caused by unemployment in the form of money, service, materials,
and/or commodities to provide the necessities of life to persons in need as a result of
the present emergency, and/or their dependents, whether resident, transient, or homeless,”
as well as to “aid in assisting cooperative and self-help associations for the barter of
goods and services.”
To facilitate the administration of this new emergency relief program, the Federal
Emergency Relief Administration (FERA) established a State Emergency Relief
Administration (SERA) in each state. At first, the SERA’s carried on the urban and rural
relief assistance together and generally in two ways: 1) through direct relief grants, or
2) employment of individuals on work relief projects. However, the needs of the rural
areas were obviously different from their urban counterparts. The rural areas wanted a
rehabilitation program rather than a relief program.
Accordingly, in April, 1934, a Rural Rehabilitation Division was established in the
FERA, and funds were designated for use only in rural areas.
The states went to work. Rural relief camps were established across the nation, and
were immortalized in the photographs of Walker Evans and John Steinbeck's novel, Grapes of
Wrath. These camps were intended to give the families, made homeless by the economic catastrophe
of that day, a place to stay until times improved.
Still, more modification was needed. However, segregating the rural and urban programs
still did not allow rural rehabilitation programs to reach their full potential. The
states needed the power to make loans; to take, service, and enforce notes and security
instruments; to purchase, hold title to, develop, and dispose of lands; to execute leases
and various other contracts; and to handle a myriad of additional functions involved in
the operation of a diversified rural rehabilitation effort.
To provide this authority, FERA authorized the establishment of legal entities in each
of the states: not-for-profit organizations known as rural rehabilitation corporations.
Forty-five rural rehabilitation corporations were formed by 1935. Only Connecticut,
Delaware, and Rhode Island did not form such a corporation; although the corporations
formed in Maryland and Massachusetts never functioned. Similar corporations were also
formed in the territories of Alaska, Hawaii, and Puerto Rico.
The rural rehabilitation corporations began to buy huge tracts of farmland which they
subdivided into 40- and 60-acre plots, then mortgaged those plots to displaced farm
families. Acting through rural rehabilitation corporations, FERA completed four
communities: Dyess Colony, Arkansas; Cherry Lake, Florida; Pine Mountain Valley
Resettlement Community, Georgia; and Matanuska Valley Colony at Palmer, Alaska. Other
such communities were completed in subsequent years. In one such project—the Ropesville
Community in Texas—families could take possession with no down payment. The only
requirements were that a four-room house with a sanitary toilet be constructed on the
property and that the family farming the land lives on it. Ropesville became a thriving
community and no foreclosures occurred there until the mid-1980s.
Other states were even more ambitious. Arkansas, for example, provided adult
education, day care for children (a very progressive effort in 1933), a school lunch
program, public libraries, and other efforts which preceded the Great Society programs
considered new thirty years later.
Dyess Colony—named for W.R. Dyess, the first WPA administrator in Arkansas—was
founded in 1934 as an agricultural project. The colony consisted of 500
individually-operated farms: each farm contained about 20 to 40 acres (totaling 15,144
acres) and used a lease-mortgage arrangement. Business and public services were
cooperatively owned and operated by the community. Originally home to 300 families,
it also served at one time as the childhood home to singer Johnny Cash.
Florida’s Cherry Lake Colony—approximately 18,000 acres—set up a canning plant
(American Handcraft Products) as well as 2640 acres of community farm. Florida imported
25 indigent families from the Chicago area, 25 families from Gary, Indiana, as well as
others from within the state. According to records, a two-bedroom one-bath house cost
$527.10 in 1935. Many of those houses are still standing. In 1967, the Florida Rural
Rehabilitation Corporation (FRRC) deeded the last of its holdings at Cherry Lake to the
4-H Clubs of Florida. That parcel, 12.34 acres on Cherry Lake, is currently being used
as a 4-H Youth Camp. Financial support for the camp from FRRC has included a grant for
building construction and scholarship funds to help rural youth attend camp.
Pine Mountain Valley Resettlement Community located near President Roosevelt’s Little
White House in Warm Springs, Georgia, was one of the most extensive and well-funded
projects of this type. Originally home to over 200 families, the community operated
until 1945. Now known as the gateway to Callaway Gardens, the area has evolved into a
primary tourism location greatly due to the efforts of Roosevelt and Calloway Gardens’
Matanuska Valley Colony at Palmer, Alaska, originally consisted of 203 families/colonists
who drew for tracts of land from 260,000 acres. Families from Minnesota, Wisconsin and
Michigan were recruited because of the similarity in climate and the extremely high
percentage of residents on social assistance programs. Within five years, over half the
colonists had left the valley. And by 1965, only twenty of the original families were
still in the valley. Short growing seasons, high freight prices and distant markets all
contributed to the difficulties.
These federally-funded, but state-sponsored programs, were only barely underway when
Congress made a major change in the federal effort.
The Emergency Relief Act of 1935 authorized $525 million for relief activities
specifically to benefit agricultural areas, a larger amount than the combined urban and
rural effort approved two years before. These funds were specifically intended for this
sort of buy, subdivide, and mortgage approach generally adopted by the rural rehabilitation
corporations. However, the 1935 Act did not include any provision for grants to the
states or the corporations. The apparent intent was to conduct the relief and
rehabilitation effort only on the federal level—supervised, controlled, and operated by
the newly created Resettlement Administration.
In the absence of future federal grants, the corporations were left with notes,
mortgages, land, and other assets, but insufficient administrative and program funds to
continue operation. The corporations began to transfer the management of their assets to
the Resettlement Administration, and by 1936, the Resettlement Administration had assumed
control of virtually all corporation assets. After the transfers were complete, some of
the corporations began to dissolve, generally transferring the assets to a state agency.
The Resettlement Administration itself did not exist long. Created in 1935, it expired
in 1937 and was replaced by the Farm Security Administration, which then managed the
corporation's assets for the next nine years. The Farmers Home Administration (FmHA) Act
of 1946 replaced the Farm Security Administration both in general responsibilities and in
the management of corporation assets.
In 1950, another law began a change that took over twenty years to take effect. That
year, Congress passed the Rural Rehabilitation Corporation Trust Liquidation Act, which
directed the Secretary of Agriculture to liquidate the corporation trusts in an
expeditious fashion. The Secretary complied, but virtually all of the states that year
signed new trust agreements with the Farmers Home Administration, generally allowing FmHA
to use the assets for insured operating and farm ownership loans and such other rural
rehabilitation purposes permissible under the corporation’s charter as may from time to
time be agreed upon between the corporation and the government.
In the 1960s, however, interest grew in re-establishing state control over the assets.
Texas Rural Communities, for example, filed legal action against FmHA seeking to reassert
its control over the assets. A federal appeals court ruled in 1964 that FmHA must allow
states to manage their own assets.
Still, progress was slow. States negotiated with FmHA on the parameters under which
assets would be returned. Primarily at issue, was how the states would cover the cost of
administrating the assets. Other issues concerned the purposes for which the assets could
The negotiations culminated in 1973 with adoption by FmHA of a model trust agreement,
allowing states, who requested it, the right to administer their own assets. FmHA and the
corporations signed agreements: ensuring that corporation funds are used in compliance
with their current “Use Agreements” and the corporation’s articles of incorporation; that
the corporation complete reports on their use of assets on a yearly basis; and that
corporations do not exceed a three percent (3%) administrative limitation per year.
Most states still operate under a similar agreement with the notable exception of New
Under the new agreements, only eighteen of the original corporations remained private
corporations. The remainder had been succeeded by state agencies—generally state
departments of agriculture.
Participation loans with FmHA became the major activity of most of the re-established
state organizations. These loans were similar to the insured farm ownership loans made by
FmHA while the assets were under their administration and provided ample security to the
But most states also adopted additional purposes. Guaranteed student loan programs
were popular in many states and many states began youth loan programs targeted at
assisting in the financing of 4-H and FFA projects. Rural development programs became
popular during the rural economic crisis which began in the early 1980s with states
adopting programs as diverse as personal computer purchase loans and rural medical
Rural rehabilitation programs that performed so brilliantly during the worst economic
days of the 1930s are again poised to make a striking difference in the economic well
being of rural America. The genius of the original concept is still alive: allow states
to craft rehabilitation programs that meet their own needs and abilities. We can measure
our success by how well we fulfill that mandate.
A Brief History of the Founding of the National Association of Rural Rehabilitation Corporations
Compiled by Kyle Stephens, Administrator (Rural Rehabilitation Loan Fund of Utah)
The year was 1971 and for a few years prior to that time, several persons involved with
the administration of Rural Rehabilitation assets had expressed a desire to organize a
meeting of all Rural Rehabilitation organizations and representatives. These individuals
conceived the idea of a meeting at a central location to discuss matters of mutual interest
and concern; some of which were as follows:
- Method of handling assets.
- Uses of assets.
- Possible uses of assets.
- Need for exchange of ideas among state groups.
- Desirability for informal national organization.
On February 22, 1971, Mr. Drew Cloud, Executive Secretary of the New Mexico Rural
Rehabilitation Corporation announced a meeting to be held in Biloxi, Mississippi, March 11
and 12, and invited representatives from each of the state corporations.
On March 11, representatives from fifteen state corporations met at Biloxi. Those in
attendance were as follows: Marvis B. Roberts (Florida); Col. E. P. Scott (Florida);
Byron Kirkland (Georgia); Joe Gillman (Iowa); Jim Rowen (Iowa); Nyle L. Katz (Michigan);
Joe Pensien (Michigan); T. B. Fatheree (Mississippi); Vyvian Walker (Mississippi);
Robert L. Fowler (Missouri); Roger Sandman (Nebraska); Drew Cloud (New Mexico); Henry R.
Sink (North Carolina); O. Leonard Orvedal (North Dakota); T. G. Stratton (Oklahoma);
John L. Neely, Jr. (Tennessee); Walter T. McKay (Texas); Joseph H. Francis (Utah); and
Walter H. Ebling (Wisconsin).
Representatives of the following states expressed an interest, but could not attend:
Arkansas, Colorado, New Jersey, Nevada, and Montana. Jesse T. Hobson, from Farmers Home
Administration, was also present and participated in all meetings.
A committee consisting of T. B. Fatheree, Drew Cloud, Nyle Katz, Byron Kirkland, and
Bob Fowler was appointed to meet and draft bylaws in order to form a national organization,
as well as to set up an annual meeting. This committee met on July 23, 1971, and undertook
the above mentioned assignment. The first meeting to officially form a national
association was scheduled and planned for October at Memphis, Tennessee.
Representatives from twenty rural rehabilitation corporations met at the
Sheridan-Peabody Hotel in Memphis, Tennessee, on October 18-19, 1971. After some
preliminary discussion, the organization committee presented a set of proposed bylaws.
The bylaws were read and each section was discussed, with several changes and amendments
being proposed. At the conclusion of the considerations, a motion was made by Marvis
Roberts, seconded by Byron Kirkland, and approved unanimously that the bylaws be adopted
as amended. The new bylaws called for the organization to be known as the National
Association of Rural Rehabilitation Corporations.
The following officers and directors were elected as outlined in the new bylaws of the
Association: President: T. B. Fatheree of Jackson, Mississippi; Vice President: Drew
Cloud of Albuquerque, New Mexico; Secretary/Treasurer: Vyvian Walker of Jackson,
Mississippi; Directors: Robert Fowler of Jefferson City, Missouri (two-year term); George
Lackman of Helena, Montana (two-year term); Byron Kirkland of Atlanta, Georgia
(one-year term); and Marvis Roberts of Gainesville, Florida (one-year term).
In 1981, at Dearborn, Michigan, Articles of Association were adopted.
Thus, the National Association of Rural Rehabilitation Corporations came into being.
In the ensuing years, the Association has had many challenges and opportunities and has
met annually to discuss these issues.
The following mission statement was adopted during the 1997 annual meeting in Orlando, Florida:
“The National Association of Rural Rehabilitation Corporations (NARRC) was established
with the following mission in mind:
- To assist members in their efforts to more efficiently manage their assets;
- To share information on successful innovative programs; and
- To further the achievement of excellence in addressing rural America’s needs.”
This mission has been and continues to be accomplished as the meetings are held each year.
For further information regarding the National Association of Rural Rehabilitation Corporations, contact:
1963 Bell Ave, #200
Des Moines, IA 50315
Annual Meeting Sites
March 1971: Biloxi, Mississippi - Organizational Meeting
October 1971: Memphis, Tennessee - National Association Founded
1972: New Orleans, Louisiana - First Annual Meeting
1973: Washington, DC
1974: Orlando, Florida
1975: Denver, Colorado
1976: Williamsburg, Virginia
1977: Jefferson City, Missouri
1978: Albuquerque, New Mexico
1979: Spearfish, South Dakota
1980: Charleston, South Carolina
1981: Dearborn, Michigan
1982: Boise, Idaho
1983: Bismarck, North Dakota
1984: Oklahoma City, Oklahoma
1985: Little Rock, Arkansas
1986: Atlantic City, New Jersey
1987: Savannah, Georgia
1988: Lincoln, Nebraska
1989: Salt Lake City, Utah
1990: San Antonio, Texas
1991: Rapid City, South Dakota
1992: Fargo, North Dakota
1993: Columbus, Ohio
1994: Billings, Montana
1995: Lansing, Michigan
1996: Cheyenne, Wyoming
1997: Orlando, Florida
1998: Colorado Springs, Colorado
1999: Colchester, Vermont
2000: Manhattan, Kansas
2001: Charleston, South Carolina
2002: Albuquerque, New Mexico
2003: South Portland, Maine
2004: Salt Lake City, Utah
2005: Little Rock, Arkansas
2006: Great Falls, Montana
2007: Point Clear, Alabama
2008: Fargo, North Dakota
2009: Traverse City, Michigan
2010: Olive Branch, Mississippi
2011: Anchorage, Alaska
2012: San Antonio, Texas
2013: Des Moines, Iowa
2014: Savannah, Georgia
2015: Sheridan, Wyoming
2016: Tampa, Florida
2017: Fort Collins, Colorado
2018: Columbia, South Carolina
2019: Rapid City, South Dakota
2020: Annual conference canceled due to coronavirus
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