Federal Regional Development Commissions

Six federal-state regional development commissions serve economically distressed and transitioning areas of the United States outside the Appalachian Regional Commission and Delta Regional Authority regions — covering the Southeast Crescent, Southwest Border, Northern Border, Great Lakes, Mid-Atlantic, and Southern New England. Each commission follows the same statutory framework: a presidentially appointed Federal Cochairperson plus the governors of member states, with authority to make infrastructure and economic development grants, designate distressed counties, and coordinate federal investment in their regions. Congress authorized $40 million per commission per year through 2029 — a potential $240 million annual investment if all commissions are fully funded and staffed.

Current Law (2026)

Legal Authority

• 40 U.S.C. § 15301 — Establishment: creates all six commissions; each has a Federal Cochairperson (presidentially appointed, Senate confirmed) and the governors (or their designees) of the member states; employees are federal
• 40 U.S.C. § 15302 — Decision-making: requires the affirmative vote of the Federal Cochairperson and a majority of state members; the Federal Cochairperson must consult with relevant federal agencies
• 40 U.S.C. § 15303 — Functions: assess regional needs; develop comprehensive economic and infrastructure development strategies; approve grants; advocate for federal investment; coordinate among federal programs
• 40 U.S.C. § 15501 — Economic and infrastructure development grants: grants for transportation infrastructure, basic public infrastructure, telecommunications, job skills training, entrepreneurship, business development, technology applications, and energy projects
• 40 U.S.C. § 15503 — Application process: applications submitted through the state member; the Commission evaluates against regional priorities and development criteria
• 40 U.S.C. § 15504 — Program criteria: consider project fit with regional development; poverty rate, unemployment, and per-capita income; economic impact; local commitment; special needs of distressed areas
• 40 U.S.C. § 15506 — Federal grant supplements: Commission can pay the non-federal share of other federal programs to help distressed communities access resources they can't match otherwise
• 40 U.S.C. § 15702 — Distressed county designations: annually, each Commission must classify counties as distressed (highest need), transitional, at-risk, competitive, or attainment; distressed counties receive priority and higher matching rates
• 40 U.S.C. § 15703 — Multi-region eligibility: counties that qualify for more than one regional commission are eligible for grants from either
• 40 U.S.C. § 15705 — Biannual meetings: representatives of all regional commissions (including ARC and DRA) meet together biannually to coordinate
• 40 U.S.C. § 15731–15736 — Geographic definitions: define the exact county coverage of each of the six commissions by name (see below)
• 40 U.S.C. § 15751 — Authorization: $40 million per commission per fiscal year 2025 through 2029; 10% administrative cap

The Six Commissions

Southeast Crescent Regional Commission (§ 15731): Covers all counties in Virginia, North Carolina, South Carolina, Georgia, Alabama, Mississippi, and Florida that are not already served by the Appalachian Regional Commission or the Delta Regional Authority. This is a large region that includes some of the most economically distressed rural counties in the South — areas with persistent poverty rooted in agricultural transition and limited industrial diversification.

Southwest Border Regional Commission (§ 15732): Covers specific counties along the U.S.-Mexico border in Arizona, California, New Mexico, and Texas. This region faces unique economic challenges — high poverty rates, infrastructure deficits common to border communities, and economies tied to cross-border trade. Border counties often have significant gaps in basic infrastructure (water, wastewater, roads) that limit economic development.

Northern Border Regional Commission (§ 15733): Covers rural counties along the U.S.-Canada border in Maine, New Hampshire, Vermont, and New York. The Northern Border region has experienced deindustrialization, forest products industry decline, and population outmigration. Communities in northern Maine, the Adirondacks, and the North Country of New York face distance from major markets and aging infrastructure.

Great Lakes Authority (§ 15734): Covers counties containing or bordering the Great Lakes watershed in Illinois, Indiana, Michigan, Minnesota, New York, Ohio, Pennsylvania, and Wisconsin. The Great Lakes region includes some of the nation's most economically challenged post-industrial communities — Flint, Gary, Youngstown, and similar cities — alongside economically healthy metros. The commission focuses on economic transition in areas left behind by manufacturing decline.

Mid-Atlantic Regional Commission (§ 15735): Covers all counties in Delaware, Maryland counties not served by ARC, and Pennsylvania counties not served by ARC. This is a relatively more prosperous region overall but includes distressed rural and former industrial communities away from the Baltimore-Washington and Philadelphia metro corridors.

Southern New England Regional Commission (§ 15736): Covers all counties in Rhode Island, Connecticut (except Fairfield County, which was excluded as too prosperous), and Massachusetts. Despite the region's overall affluence, it includes economically distressed post-industrial communities in Providence, Bridgeport, New Haven, Springfield, and Fall River.

How It Affects You

If you're a local government official in a covered region: These commissions are grant sources that can fund projects beyond what local tax bases support. The key entry point: contact your state's commission representative or the Local Development District (LDD) serving your area — LDDs are multi-jurisdictional planning organizations that help coordinate grant applications and connect communities with commission resources. The ARC's LDD directory is at arc.gov/local-development-district. Don't try to navigate commission grants without an LDD; they know the cycles, the priority areas, and how to package applications.

If you're planning infrastructure in a distressed community: Your county's distressed designation determines your matching requirement. A community classified as distressed by the commission may be able to fund a water system or broadband project with 80 cents of federal money per 20 cents local — far better than standard federal program ratios of 50/50. Annual reclassification means communities that experienced economic shocks in the past 1–3 years (plant closures, population loss, natural disasters) should actively seek re-evaluation for distressed status before the next grant cycle.

If you're an economic development organization: Commissions can supplement the non-federal share of other federal programs — meaning if your community received an EDA or USDA grant requiring a 20% local match you can't afford, the regional commission may be able to cover that match. This "supplement" or "match" authority is one of the most powerful but least-known features of the commission framework. It effectively turns a grant you couldn't afford to take into one you can, and stacks federal investment across programs.

If you're a state-level economic development official: Active engagement in the commission process — submitting strong development plans, staffing the governor's designee role with someone who actively coordinates applications across agencies — translates directly into more federal investment flowing to your state. States that treat the commission as a passive compliance exercise leave grant money on the table. The commission's state members have formal voting authority in the commission process; that seat has real leverage over federal investment priorities.

State Variations

The commissions serve multiple states and require consensus among governors with different political priorities and fiscal situations. The Federal Cochairperson appointment (which requires Senate confirmation) has been a chokepoint — positions have been left vacant for extended periods, limiting commission effectiveness. Actual appropriations have often been well below the $40M authorization, so the practical value of these commissions varies by funding cycle.

Pending Legislation

The FY 2025-2029 authorization provides near-term stability. Advocates have pushed for higher appropriations (arguing that $40M per commission is insufficient given the scale of need) and for eliminating the confirmation requirement for Federal Cochairpersons to reduce vacancy periods. No major structural changes pending as of 2026.

Recent Developments

• Trump FY2026 budget proposed eliminating all regional development commissions: The Trump administration's FY2026 budget proposal included elimination of all federal regional development commissions — the Appalachian Regional Commission, Delta Regional Authority, Denali Commission, Northern Border Regional Commission, Southeast Crescent Regional Commission, Southwest Border Regional Commission, and Great Lakes Authority. The justification: these commissions duplicate EDA functions and represent unnecessary federal bureaucracy. ARC has historically been the most politically protected — it serves 13 states including major Republican states (Kentucky, Tennessee, West Virginia, Alabama) and has a 60-year institutional history. No elimination has been enacted; Congress has repeatedly defended these commissions even in tight budget environments. The FY2026 outcome depends on appropriations negotiations in the 119th Congress.
• IIJA supplemental funding winding down — commissions returning to baseline: The Infrastructure Investment and Jobs Act (2021–2026 implementation) provided one-time supplemental appropriations that roughly doubled the annual budgets of most commissions for the grant cycle. IIJA-funded broadband, water, and transportation investments in ARC and DRA service areas are now in implementation or completion phases. As IIJA supplemental funding is expended, commissions return to their base appropriation levels — which have been essentially flat for years and represent declining purchasing power in real terms. The gap between IIJA-era investment levels and base appropriations creates planning challenges for state and local partners who built expectations around higher federal investment.
• Supply chain reshoring creating new opportunities in ARC and Great Lakes regions: The push for domestic semiconductor, pharmaceutical, and advanced manufacturing production — driven by CHIPS Act, IRA incentives, and tariff policy — has generated significant new manufacturing investment in Appalachian and Great Lakes states. Regional commissions have positioned their workforce development, infrastructure grant, and technical assistance programs to support reshoring-related economic development. ARC's new strategic plan emphasizes connecting Appalachian communities to emerging manufacturing opportunities; the commission's workforce grants to community colleges and technical schools are specifically targeting manufacturing certification programs aligned with new factory investments.
• ARC's 60-year anniversary highlights complex legacy: The Appalachian Regional Commission marked 60 years of operation (2025). Its record is genuinely mixed: Appalachia's poverty rate relative to the national average declined from 27 percentage points above national average in 1965 to about 10 points above today; the highway system ARC built (the Appalachian Development Highway System) connected previously isolated communities; education and health indicators improved. At the same time, opioid addiction, coal's collapse, and persistent poverty in the most rural counties demonstrate the limits of infrastructure investment in driving structural economic transformation. ARC's 60-year history is a case study in what federal place-based development investment can and cannot accomplish.