As economy changes, so does the shape of the Appalachian region - WOWK 13 Charleston, Huntington WV News, Weather, Sports

As economy changes, so does the shape of the Appalachian region

Posted: Updated:

In 1965, West Virginia was a very different place. Highways were few, economic development was sparse and per capita income was extremely low.

But now, even the southernmost parts of the state are accessible by highways. Economic development, although still hindered in some areas, has grown and fewer residents live in poverty. While there is still some work to be done, many programs and initiatives that have taken root in West Virginia are the result of a little-known federal program called the Appalachian Regional Commission.

Originally formed of counties in the Appalachian Mountains from the Pennsylvania-New York border south into all of West Virginia and parts of Ohio, Virginia, Maryland, Kentucky, Tennessee, North Carolina, Georgia and Alabama, the ARC was created to help spark economic growth in the poorest, most rural counties in Appalachia.

However, the scope of Appalachia has changed. Now, the ARC includes counties in southern New York, northern Ohio, central Kentucky and Tennessee, northern South Carolina and northern Mississippi. Some of those counties, while in Appalachian states, are not traditionally considered Appalachia. And while those counties may need federal assistance to fund economic development programs, some argue broadening the boundaries of the ARC hurts the true Appalachian counties most dependent on the program.

A Changing Appalachia

Ronald Eller, a distinguished professor of history at the University of Kentucky, said people born and raised in traditional Appalachia have a much more narrow definition of the region that's closely tied to the mountains themselves, not economic concerns.

"Obviously that's a political question," Eller said when asked if the definition of Appalachia is changing. "As someone who was born and raised in the mountains — my people have lived in the mountains since the 1760s and I'm originally from West Virginia — for folks who have the concern and love for the heart of the region that I do, I have a much more narrow definition of the region that is tied to the physical definition of the mountains themselves than the broader political definition of Appalachia that has emerged over the years because of the political need to get the program funded."

Eller has studied the ARC for decades and has seen how the program has changed over the years. While he acknowledges the ARC has allowed even the poorest regions of Appalachia to develop, he said a national lack of concern for the region, and poverty in general, continues to be a hindrance. 

"The real problem today I think is not so much the definition of what Appalachia is; we've been arguing that for 40 years," Eller said. "I don't think there's a clear definition. The issue today is, I think, the lack of any concern about these problems at a national level. The fact we don't have a rural development policy at the national level, little concern about rural communities in West Virginia, eastern Kentucky, Arkansas, Oklahoma, wherever they might be — that's the real challenge we're confronting today."

Creation of the ARC

The ARC was developed in the early 1960s. The President's Appalachian Regional Commission Act passed in 1965, but most of the ideas for the program came from Franklin D. Roosevelt Jr., who campaigned in West Virginia with future President John F. Kennedy during the 1960 campaign. Roosevelt, along with governors from the central Appalachian states, specifically West Virginia and Kentucky, created the initiative. Roosevelt spent nine months of Kennedy's campaign interviewing Appalachian community leaders about economic development in the region. The President's Appalachian Regional Commission was designed to address the major economic problems the region was facing in 1960.

"It was recognized that individual state approaches to addressing the problems would be limited by state resources, so they needed to work together to try to leverage federal funds for the region," Eller said. "Eventually that was successful in 1965 after Jack Kennedy's assassination and creation of the war on poverty."

The ARC was originally created to help spur economic development in the seven central Appalachian states, but the program needed federal funding.

"Originally, the idea was the program was to address the problems of the seven central Appalachian states, but because of the need to gather political support to get the bill passed in Congress, the original states got increased from seven to 12 then eventually to 13," Eller said. "What we have seen over the years is individual counties being added to Appalachia."

According to Louis Segesvary, a spokesman with the ARC, the counties are added to the program through acts of Congress. The ARC simply acts as a program to allocate funding provided by Congress. It has no decision-making power when it comes to what counties are part of the program. 

"Its counties are determined by Congress," he said. "They're not determined by the agency. The number of counties, 420 now, are all a part of congressional legislation."

The most recent county to be added to the ARC is Hardin County, Kentucky, "some 200 miles west of bona fide Appalachian towns like Harlan and Hazard," according to the Associated Press. Louisville and Bowling Green, traditionally considered to be more Midwestern, also have been added to the ARC in recent years. 

ARC in West Virginia

West Virginia is the only state in which all counties are part of the ARC. While some counties do better than others, it is hard to ignore the fact that every county in the state has received some money from the ARC for various projects.

The first major goal of ARC is to increase job opportunities and per capita income so that counties in Appalachia can reach parity with the rest of the nation. ARC categorizes each county into one of five designations: distressed, at-risk, transitional, competitive and attainment. In West Virginia, only Jefferson County reached attainment in fiscal year 2012. However, it slipped back into competitive status for fiscal year 2013.

According to West Virginia Commerce Secretary Keith Burdette, the ARC awarded the state more than $4 million in fiscal year 2012 for various projects. Because of the way ARC is structured, the state was required to spend $1.1 million in distressed counties, which are Calhoun, Clay, Lincoln, McDowell, Roane, Summers, Webster and Wirt. However, the state went beyond that requirement and actually spent about $2.5 million in distressed counties out of the allocated funds.

Burdette said each state has match requirements that range from 30 percent to 70 percent based on the status of the county. As counties improve, the match rates increase. But the state also must consider a tighter federal budget.

"The federal government is tightening the purse strings, obviously," Burdette said. "In multiple years there has been a battle just to retain the ARC program within the federal government. Fortunately, because of the number of states involved and the impact it's had on those states, the ARC held up all these years. That will probably be more of a struggle, and it may get worse within the next year or two."

The future of the ARC also was called into question in the 1980s. According to Eller, the Ronald Reagan administration didn't place a high priority on rural development programs such as the ARC. That's when the program began to change from local brainstorming to grant writing.

"Reagan did not like multistate development programs like ARC, so he zero budgeted ARC in his budget," Eller said. "Congress kept it alive by allocating smaller budgets to it. But beginning at that point, the function of those loose, local development districts shifted to writing grants … rather than promoting and encouraging creating thinking in their districts."

Delegate Clif Moore, D-McDowell, said he has seen the ARC do great things in his county, by far the poorest in West Virginia. Moore is the McDowell County manager, so he works closely with the county commission in procuring funds for various projects. When an application is submitted to the ARC, it is looked at and scored on a national level, meaning when more counties are added, competition heats up. But Moore doesn't see that as anything negative.

"I would tend to think if they increase the territory, nobody has told me this, but if they increase the territory, they would have to increase funding dollars a little bit to keep up with the competition and the amount of applications that will come in, so I see that as an opportunity and not necessarily something negative," Moore said. "It's a stepping stone. Particularly if we can take our key and unlock the capacious trunk of federal funding to get money for McDowell County, I have no problem with it at all. But don't cut us out of the deal simply because you want to include other people. Make the money more available, maybe a little easier to get, but certainly adhere to some guidelines so we can be in the purview of federal regulations, because we never want to be outside that."

The ARC has been instrumental in improving much of McDowell County's infrastructure systems. According to Moore, the county has seen more water and sewer projects since 1994 than any other county in the state. 

But infrastructure isn't the only thing that needs improving in McDowell County. Poverty is high, as is unemployment and drug abuse. While the ARC does focus on infrastructure, it also pays attention to job creation and strengthening the ability for Appalachia to compete globally. But problems in Southern West Virginia hinder those goals.

"We have two huge barriers. One we can do something about and one we can't," Burdette said. "The one we can't is we don't have a lot of flat property. God gave us spectacular scenery, but he didn't give us a lot of flat land. When we compete for major industrial development, the number of usable sites with infrastructure that are large enough are hard to find.

"The things we can do something about, it's not easy, but its work force issues. We have an incredibly loyal, hard-working work force, but it's not big enough. We have a lot of folks who don't participate. We have one of the lowest participation rates of eligible people actively in the work force. A lot of that is because they're not skilled enough to compete. We've got to address that. We've got to find a way to not just get our kids ready, but we've got to reposition some adults who still have a long time to work but don't have the skills to compete for jobs."

Those aren't the only barriers to growth, however. McDowell County has no four-lane highways and only three miles of three-lane highways. This prevents economic development, Moore said.

"You know and I know highways are the lifeblood to economic development and activity," he said. "We're not connected. When we're not connected we get further and further and further behind. We've got to come up with a way to build the Coalfields Expressway and King Coal Highway that will really affect businesses and future opportunities in Southern West Virginia."

Future of the ARC

The ARC continues to change. It has morphed from a program that encouraged local entities in central Appalachian counties to think about economic development into a program that focuses more broadly on grant writing in 420 counties, some of them nowhere near the Appalachian Mountains. Many counties, including some in West Virginia, depend heavily on funds from the ARC. But as the federal government looks at which programs to save and which to cut from the federal budget, the future of the ARC is called into question.

"The ARC has made an important difference in building Appalachia as it is today," Eller said. "But that leaves the glass half empty as well. It is half full in there's been a lot accomplished. But there is a long way to go yet in addressing the problems of the region."

As Moore mentioned, highways need to be constructed to help McDowell County grow. States can't always allocate millions of dollars for economic development projects that may or may not work out. The economies of Appalachian counties, particularly those in Southern West Virginia, could be diversified and create more jobs. But Eller said the ARC has worked to accomplish all that.

"I think there's no question the ARC helped facilitate the growth in the region, everything from the highway program to various water programs, the building of health care centers, even ARC money put into education and other programs," he said. "There is absolutely no question. Those resources for infrastructure have been absolutely critical to the region today."

In order to remain effective, Eller said the ARC needs to concentrate on true Appalachian counties and concentrate its energies more on combating severe poverty.

"If the ARC is to be effective in the future, it needs to be revitalized," Eller said. "It needs to be redefined and its energies concentrated more in the heart of the region where the most severe poverty and most severe economic problems exist. It needs to return to being a planning agency instead of managing grants and passing through money."

A new ARC should work in communities, organize cooperative efforts, promote economic development "and above all engaging citizens in that process," Eller said. 

Burdette said he's grateful for all the help ARC has provided to West Virginia, but he hopes the state doesn't need the program in the future.

"I hope in 30 years we don't need it," he said. "I hope West Virginia has evolved and there are enough jobs and enough opportunities that we don't need it. Realistically, I think the ARC can always play an important role in West Virginia — maybe in different areas at different times because of different circumstances. Economies ebb and flow. Certain industries grow and others die off and there have to be replacement opportunities. As is the case with other states besides West Virginia, every state from New York down, I think there will always be a place for the ARC to do good work, an important work in West Virginia."

Burdette said he admires the men who put the program in place, and he wondered if today's politicians have that kind of foresight.

"I was looking back and thinking about the wisdom in the 1960s, of Sen. Byrd, Sen. Randolph, President Johnson and others who recognized at the time in a state that had almost no interstate highway system, had a changing set of demographics, changes in coal, changes in energy, changes in steel and recognized the cost of infrastructure and everything else it takes is so much more expensive through the Appalachian regional chain. I look back and wonder if we'd be that smart today to look that far ahead," he said.

"(The ARC) has played a really significant role in our state," he added. "We all ought to be grateful for that. It's made things happen that otherwise might not have happened."