USDA excluding rural housing loans from environmental reviews

The U.S. Department of Agriculture will continue to exclude rural housing loans from environmental reviews that may slow expansion of oil and gas drilling.

Agriculture Secretary Tom Vilsack said he will authorize a notice affirming that rural housing loans are “categorically excluded” from reviews under the National Environmental Policy Act, which requires some transactions to be examined for their affect on soil, air and water.

“As indicated in previous statements, USDA will not make any policy changes related to rural housing loans,” Vilsack said today in an e-mailed message.

President Barack Obama in his State of the Union address in January said natural-gas production from techniques including hydraulic fracturing, or fracking, would support 600,000 jobs by the end of this decade. Still, the technique has alarmed environmentalists who say the process can contaminate drinking water and pollute the air.

Fracking involves injecting water, sand and chemicals underground to break up shale-rock formations and release trapped gas. Texas is the largest U.S. natural gas-producing state, followed by Wyoming, Louisiana, Oklahoma and Colorado, according to the Energy Department.

The USDA offers loans and loan guarantees as part of its mission to develop housing and business in less populated areas. It has an active rural-development portfolio of more than $165 billion of loans and loan guarantees.