KY Policy Blog

Important Federal Investments in Kentucky’s Coal Communities at Risk

By Ashley Spalding
April 28, 2017

A panel at the East Kentucky Leadership Conference highlighted the importance of federal investments in addressing economic challenges in the state’s coal communities. With these funds at risk in the federal budget for 2018 and beyond, eastern Kentucky — and the broader Appalachian region — could be stalled in these important efforts.

At the conference a number of participants in projects funded by the federal POWER (Partnerships for Opportunity and Workforce and Economic Revitalization) Initiative highlighted how these funds — reportedly approximately $20 million in Kentucky — are being used to address economic challenges in the region. These single- and multi-state POWER projects range from efforts to promote entrepreneurship, to retraining dislocated coal miners, to developing tourism and local food economies.

For the last two years, the POWER Initiative has worked to develop new businesses and industries, create jobs, and train dislocated coal economy workers for in-demand occupations. The Initiative was designed to involve 12 federal offices in 10 agencies in providing federal economic and workforce funding and other resources to coal communities and workers.

Here are descriptions provided at the conference of several economic development projects provided grant funding through the Power Initiative that are working to address challenges in Kentucky:

Building Entrepreneurial Communities: The Foundation of an Economic Transition for AppalachiaThe Center for Rural Entrepreneurship in Chapel Hill, N.C. will build and strengthen the entrepreneurial ecosystem in an 18-county region covering southeastern Ohio, southern West Virginia, and southeastern Kentucky. Project activities include establishing a support system that can identify and develop new entrepreneurs; assisting new and expanding businesses with skill development; and connecting entrepreneurs with existing capacity-building resources in the region. The project will create 72 new businesses and 250 new jobs.

Central Appalachian Food Enterprise CorridorAppalachian Sustainable Development in Abingdon, Va. will develop a coordinated local foods distribution network throughout Central Appalachia, and will connect established and emerging producers in Ohio, West Virginia, Tennessee, southwest Virginia and eastern Kentucky to wholesale distribution markets. The ARC award will support planning, partner convening, and capacity building, as well as production and processing equipment, supplies and labor costs, and will be supported by funding from the Just Transition Fund.

Eastern Kentucky Coal County Transformation – The Big Sandy Community and Technical College in Prestonsburg will work with 3 eastern-Kentucky education institutions — Big Sandy, Hazard Community and Technical College, and Southeast Kentucky Community and Technical College — to launch a comprehensive, employer-driven workforce development program focused on building the digital economy and strengthening digital innovation and entrepreneurship across a 16-county region in eastern Kentucky. The consortium — in partnership with Shaping Our Appalachian Region (SOAR) and the Eastern Kentucky Concentrated Employment Program (EKCEP) — will establish educational programs that develop workforce skills in emerging regional career clusters such as cybersecurity, medical coding and advanced manufacturing. The program will specifically engage dislocated workers from the coal industry through targeted advertisements, and will provide adult basic education as needed to ensure that these individuals can participate in the training courses. . The project will serve 300 trainees.

Economic Transition for Eastern Kentucky (ETEK) InitiativeThe Mountain Association for Community Economic Development (MACED) will expand fast-track retraining and entrepreneurial technical assistance services targeted to dislocated coal workers; establish an intern program aimed at placing former coal workers in the energy efficiency sector; and increase access to capital through a $1,000,000 venture capital loan fund. The project will create 200 new jobs and 100 new enterprises, serve 500 existing businesses, and bring $12,000,000 in leveraged financing to a 54-county region in Eastern Kentucky.

Intergenerational Training CenterThe Hazard Community and Technical College (HCTC) in Hazard will be used to construct a 14,700 square foot facility at HCTC’s Lees College Campus in Jackson that will deliver job training and credentialing courses focused around four emerging regional career clusters: information technology, telemedicine and health sciences, mechatronics and eco-tourism/small business development. The project will leverage the capacity of the Eastern Kentucky Concentrated Employment Inc. (EKCEP) and the Kentucky Career Center to promote and market the program to out-of-school youth and displaced and underemployed workers impacted by the decline in the coal industry. The project will serve a 7-county area in southeastern Kentucky, and will train 295 dislocated workers and credential 228 students over the life of the award.

KY-WV Regional Drone Technology Workforce ProjectThe Maysville Community and Technical College (MCTC) will partner with Southern West Virginia Community and Technical College to deliver comprehensive training courses in small-air drone operation to a 7-county area in southern West Virginia and a 13-county area in northeastern Kentucky. Specific training activities will enable graduates to operate drones and drone sensors to provide in-demand commercial services — such as the close-up inspection of fixed structures like power lines, utility poles and cell phone towers. The project will serve 100 trainees over the 2-year life of the award, will leverage $14,000,000 in private investment, and will, in conjunction with a previous ARC POWER award, further strengthen the emerging drone industry cluster in the West Virginia-Kentucky-Virginia tri-state area.

Leveraging Innovation Gateways and Hubs Toward Sustainability (LIGHTS)Ohio University in Athens, Ohio will strengthen Southern Ohio’s entrepreneurial ecosystem by leveraging the capacity of four strategically located “Innovation Hubs” — which provide facilities, equipment and design/engineering expertise to entrepreneurs — and five regional “Gateway Centers” that link local entrepreneurs to a broad array of support services throughout the ecosystem. The project will build on the successful TechGROWTH Ohio model, create 360 new jobs, 50 new small businesses and bring $5,000,000 in leveraged private investment to the area.

TechHire Eastern Kentucky (TEKY) Initiative: Developing a Technology-Driven Workforce Eastern Kentucky Concentrated Employment Program will serve young adults aged 17-29 who are out of school, and older adults who are unemployed, laid-of, or underemployed by offering several avenues to industry-led accelerated technology training, paid work-based internships and employment opportunities in IT careers. This comprehensive workforce development initiative will train 200 new workers, create 160 jobs and serve to bolster existing and emerging sectors that rely on a skilled information technology workforce in 23 Eastern Kentucky counties. The initiative will provide the trained workers necessary for a private technology company to expand its operations into Eastern Kentucky.

A full list provided at the conference of POWER projects that either focus on or include Kentucky can be found here.

Unfortunately these important investments in eastern Kentucky, and other areas that have been impacted by the decline in the coal industry, are at risk in the federal budget. As described in a recent research brief, President Trump’s fiscal year 2018 budget blueprint — also known as the “skinny budget” — proposed cutting (see table below) at least $1.13 billion in funding for 7 federal programs and/or offices (in part or in entirety) that provide direct economic and workforce development assistance and other services to coal miners and their communities. In addition, while the budget blueprint does not explicitly eliminate the other five federal offices involved in the POWER Initiative, top-line funding levels specify additional cuts, and even more cuts are expected in the full budget proposal that will be released in late May.

Source: Center for American Progress.

As noted in the brief: “The budget’s rollback of the POWER Initiative programs would stunt economic revitalization where it is needed, and additional cuts to other assistance programs would compound the economic challenges facing coal communities and the families who call them home.”

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