Swedish rural municipalities has since the end of the eighteenth century experienced an constant population decline, with an much higher intensity than in many other Western countries. Many observers have concluded that is a consequence of the Swedish government’s disinterest in rural development. With the European Union accession of Sweden in year 1995 more attention was given to the issue, when the Swedish rural policy became interwoven into the EU’s Regional policy and its structural funds. This was a door-opener for the rural municipalities into a unique financial aid opportunity. The aim of this essay is to provide empirical contributions to the understanding of how Älvdalen municipality as a representative case of a Swedish rural municipality works with the EU’s structural funds. In order to expand our understanding, the essay draws upon the ideal types of government and governance. The method of this study is a qualitative case study and the material for the study consists of 8 interviews with central people in the policy process. The empirical investigation shows that due to the resource and competence deficiency that exists in the municipality, they hold a disadvantaged position in the policy process. Furthermore exercises the national level still a crucial role in the policy process.