West Virginia Blue
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LEBANON, Va. - It was a time when Appalachia, burdened with some of the highest unemployment and poverty rates in the nation, decided to help itself. Twenty years later, government leaders say the Virginia Coalfield Economic Development Authority works.
[snip]
The goal was to form a regional agency that could use coal and gas severance taxes to diversify the economy in a region almost solely dependent on coal. Because one day, community leaders realized, the coal would run out.
"We raised the severance tax and put it into economic development ourselves," Quillen said. "I'm just so proud of what this authority does because I think it sends out a signal from Southwest Virginia to other places that we're going to be counted and we're going to help ourselves, and you should come in and help us too."
Jonathan Belcher, VCEDA's executive director, said in its 20 years the authority has helped to create 12,000 jobs and draw $2 billion in private investment to the region. Over those two decades the authority has approved $117 million in funding for 208 projects. And thousands of those new jobs, Belcher said, are in industries other than coal - more than offsetting the job losses in the industry during that period.
[snip]
As it enters its third decade, VCEDA's latest campaign is aggressively marketing the coalfields as "Virginia's e-region," with millions of dollars dedicated to deploying broadband Internet technology across the region's seven counties.
"Just about every industry now has to have high-speed fiber-optic broadband," Belcher said. "That is a key competitive advantage for the region."
The authority's focus is on high-tech jobs alongside the energy jobs, "both traditional energy jobs and the advanced energy jobs of the 21st century," Belcher said. In other words, he said, the region welcomes green jobs with open arms.
Alpha Natural Resources CEO Michael Quillen, who was VCEDA's first chairman, said the authority had "a pretty rocky start."
The idea wasn't well-received by elected officials who didn't like the thought of a regional authority deciding how money would be distributed among seven counties, three of which produce most of the severance tax revenue...
Some key points so far
1. Diversification provides news jobs as coal mining jobs inevitable disappear.
2. Political independence is necessary for good longer-term planning.
3. Coal mining and other industry can co-exist when resources are specifically allocated and the right structure put in place to make it happen.
But... there are some potential problems:
Kathy Selvage, vice-president of Southern Appalachian Mountain Stewards, a nonprofit group based in Big Stone Gap, Va., said VCEDA's work is not truly diversifying the region's economy; instead, she argues, it is building up the region's dependence on coal.
"Severance money should not be used to promote coal, and that's what they're doing with building a power plant; they're not promoting diversification," Selvage said. "When you're creating a bigger demand for coal, that's not diversifying your economy."
Steve Fisher, a retired professor who lives in Emory, Va., and has taught and written extensively about the region, said VCEDA should be encouraging a model different from traditional economic development. He said severance tax revenue should be used to address the overall needs of the community and develop a locally based, sustainable economy.
The $1.8 billion coal-fired power plant under construction in Wise County is touted as a crowning achievement of VCEDA's work.**
(** Update: Per information in this comment, VCEDA was not responsible for developing the coal plant, that was due to later legislative action...)
Okay, that's definitely a problem. We don't need any more coal-fired power plants in this area. That's not diversification I can believe in. The rest of their projects sound a lot better: call centers, R&D centers, and other office space.
Belcher said. "They went from that county probably having the least-developable property all over the state to having maybe the most property."
Belcher said VCEDA has "allowed a tremendous amount of economic development to happen in the area that would not have happened otherwise."
"If you look around the region at pretty much any of the major economic development projects that have occurred over the past 20 years there has been some VCEDA funding or some role that VCEDA has played," he said.
So another important lesson: get the charter right for diversification in economic development, not more coal-centric economic development.
"The cap and trade and climate change issue is vindication for why this group is here," said Tommy Hudson, president of the Virginia Coal Association and vice-chairman of VCEDA's executive advisory board.
"We all knew coal would be here for a finite time and we'd have to have the industries to replace it," Hudson said. "Coal might be here for less time because of climate change, and that makes our work and the work of VCEDA more important."
[snip]
"You make such a tremendous difference here," Ford Quillen said. "There's no more moral or better thing to do than to provide jobs for your people."
There is no time like the present to responsibly end Mountain Top Removal and actively work to diversify the West Virginia economy. Twenty years ago the Virginia legislature had the vision to start the process for Virginia coal fields. Their foresight is paying major dividends today.
When will the our legislature start preparing West Virginia for a future beyond coal?
Folks around the Legislature are used to hearing a certain question whenever public policy options are discussed. "How are we going to pay for it?"
It's a perfectly legitimate question, even though I haven't always enjoyed trying to answer it. After all, West Virginia has major financial obligations, many urgent needs and lots of competing interests. And regardless of their merits, any budget or policy decision, whether starting a program or cutting taxes, has certain costs.
The state Senate recently introduced a bill that would eliminate the business franchise tax by 2013. In 2006, this brought in $120 million in state revenue. The business franchise tax rate was lowered in January 2007 from 0.70 percent to 0.55 percent. The rate will be further reduced over the next five years to 0.20 percent in 2012.
Some public policy issues are really complicated, but some aren't. Here's a simple one: earnings tend to go up with educational attainment.
West Virginians are low in both. It doesn't take much to connect the dots.
Unfortunately, many West Virginians of all ages don't pursue higher education or job training either because they can't afford it or because they don't know how to access programs that make it affordable.
The solution would include both outreach and evaluating current state programs and policies. Here's some common sense from The Bluefield Daily Telegraph:
In light of the recent reports, West Virginia must review its programs that promote and assist high school and non-traditional students in getting a college education and, if need be, overhaul them.
If officials are serious about improving the economic environment then educational opportunities and training for adults must become a top priority.
The Mountain State will never be truly "open for business" if we don't have the qualified manpower to fill the ranks of incoming industry.
Works for me. And it just might work for West Virginia.
A new study shows that West Virginia has the chance to develop a high-tech, high road economy. This is from an item by Joe Morris in today's Gazette:
A new independent study of West Virginia’s economy concludes that the state could become a leading market in high-tech industries such as pharmaceuticals, biometrics and cutting-edge energy products — with the right investment.
The research was carried out for A Vision Shared, a business coalition focused on economic development, by Columbus, Ohio-based Battelle Science and Technology International.
And public investments in infrastructure, higher education, and workforce development are key. The article cites Kevin DiGregorio, executive director of A Vision Shared’s Technology-Based Economic Development committee, who said that public institutions like WVU and Marshall University can be springboards of this kind of development.
The state can’t rely on the market alone to foster high-tech industry, DiGregorio said.
“It hasn’t happened,” he said. “The experience of people who do technology-based economic development in the states is that to be successful you have to bring in coordinated help.”
Knowledge, talent and creativity could hold the key to a better future for West Virginia. According to Create West Virginia, a project of A Vision Shared and partners, "culture, creativity and innovation" are the keys to moving WV into the new economy.
To get there, though, we need several things, including talent, technology, tolerance for the new and the different, and the kind of quality of life that draws talented, creative people from elsewhere to come here and encourages our own talented and creative people to stay here and make a difference. This means public investments in education, infrastructure, and research and development.
This would be the high road to economic development and a better future for all. The alternative, such as it is, is a low road, which would slash investments in education, health care and infrastructure, reduce labor standards, and promote a race to the bottom.
Given the choice, I'd prefer the high road.
There's more, including a rear view of a displaying peacock, at The Goat Rope.
Good Jobs First is a policy resource center that promotes accountability for corporations and governments in economic development. They recently updated their Wal-Mart subsidy information, where you can click on a state to see how much the retail giant has gotten in corporate welfare.
Here's what they have to say about West Virginia:
There are no centralized databases of economic development subsidies, but Good Jobs First found 4 deals worth a total of about $9.7 million in West Virginia. They include the following:
Good Jobs First has compiled data on Wal-Mart subsidies in the following cities
Many Wal-Mart workers are ineligible for health coverage from their employer or choose not to purchase what is available, because it is too expensive or too limited in scope. These workers often turn to taxpayer-funded health programs such as Medicaid. In December 2004, the Bureau for Children and Families, acting at the request of the Charleston Sunday Gazette-Mail, released data on the employers of parents of children enrolled in the State Children's Health Insurance Program. Leading the list was Wal-Mart, with 452 workers whose children participated in the plan. Source: John Heys and Paul Wilson, "Wal-Mart Culture: Wal-Mart Tops State CHIP List," Charleston Sunday Gazette-Mail, December 26, 2004, p.1A.
Greg LeRoy, Good Jobs First executive director, sums it up pretty well:
That a company with a predatory business model and a poverty-wage labor policy can even qualify for job subsidies suggests many public officials still don’t get it.
The Hatfield clan poses in April 1897 at a logging camp in southern West Virginia. The most infamous feud in American folklore, the long-running battle between the Hatfields and McCoys, may be partly explained by a rare, disease inherited by the McCoy clan that can lead to hair-trigger rage and violent outbursts.(AP Photo)
Checking in with West Virginia blogs, we provide these recent stories of note:
--- The search for a new President of West Virginia University is generating plenty of controversy. The ever-useful Lincoln Walks on at Midnight notes the story has even gotten some National attention. For a straight-up blogger tell-it-like-they-see it perspective on the controversial background of Mike Garrison, the Fifth Column has all the details. I didn't live in the W.Va. during the Bob Wise administration, yet I have no reason to doubt his story of exploiting political power for personal advancement.
--- Back Porch Politics caught a "breaking" story of Sago and Darby mine windows appearing in front of Congressional committees. [The Gazette-Mail article has since moved here.] Ken Ward Jr. writes (emphasis mine):
Widows of the miners killed in last year's Sago and Darby disasters led the call for tougher enforcement by the U.S. Mine Safety and Health Administration.
"Despite Congress' good intentions, I have to wonder if little has actually changed," said Deborah Hamner, whose husband George was among 12 miners killed at Sago. "I fear that miners would fare no better today in an explosion than my husband and his co-workers did."
Melissa Lee, whose husband Jimmy died in the May 20, 2006, Kentucky Darby disaster, testified with Hamner at a hearing of the House Subcommittee on Education and Labor.
Wanda Blevins and Betty Riggs, whose husbands died in the 2001 explosion at the Jim Walter Resources No. 5 Mine in Brookwood, Ala., also attended Wednesday's hearing.
"Somebody has to keep speaking for the miners," Melissa Lee said. "These men were not just coal miners. They were husbands and fathers and grandfathers."
--- I'll leave it to smarter people than me around here to say if a new book about West Virginia economic development, 'Unleashing Capitalism' Dissects State's Economy (Book provides some suggestions to trigger prosperity in Mountain State), has anything useful to say or not. I'm more than a wee bit skeptical when it's put out by a new "free-market" think tank with website links to right-wing welfare organizations (e.g., State Policy Network) and Heritage Foundation affiliates(e.g., PolicyExperts.org). The only effects I've seen of "free-market" policy is increased corporate profits, higher government debt, and rampant consumer debt--all achieved through greater government subsidies of large corporations. Any arguments that Republicans have never--in the many years of complete federal government control--properly implemented free-market control are as convincing as the argument that communism was never properly implemented in Russia, China or Cuba. Perhaps someone with greater fortitude than I can check out free links to the first four chapters.
How about you, found anything interesting on the web this week?
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