This week’s post comes at an auspicious time for coal communities across the country. Not only has the coal economy shrunk considerably, but the federal support that has been hinted at, drawn up, and for brief moments implemented, looks as though it may have reached its political peak.
Rachel concluded her last post with a call for more assistance, federal and/or state, to complement and augment what communities had already managed for themselves. The idea was to stem the immediate losses in tax revenues and income resulting in coal mine closures, to facilitate financing to new small businesses, and to make re-training for laid off miners a viable option. This call has been made by others, while yet others see a carbon tax as a revenue neutral option that could assist coal communities with clean-ups, social services, and infrastructure.
AMRDI stands behind the call for more, not less, federal assistance. Assistance that pairs government funds with community stakeholders (like the Obama-era POWER+ plan intended) and encourages local innovations and locally-inspired solutions should be emphasized. AMRDI would also like to see both carrots and sticks employed to encourage remediation of abandoned mines by mine owners, which would jump start the economic recovery, enhance the local environment, and benefit emerging recreation and tourism sectors.
However, as Rachel indicated in her last post, coal communities do not expect the assistance that organizations like ours argue for, and are already brimming with creative ideas to strengthen and diversify their economies. In interview after interview, Rachel heard from stakeholders convinced that local oversight, and local leadership, was essential to diversification and a successful transition away from coal dependency—with or without federal assistance.
Many of the local ideas relayed to Rachel are gaining steam at the state level as well.
“We decided that whatever we did would have to be sprung from within,” Representative Harold Rogers (R) of Kentucky told the New York Times. He and then-Governor Steve Beshear (D) founded Shaping Our Appalachian Region (SOAR), which has attempted to incubate an innovation economy in Appalachia.
Similarly, Jeff Hawkins, from the Kentucky Valley Education Cooperative, argued in a Governing.com article that, “we’re never going to get to where we need to be until we realize that our solutions have to come from us … We have to break the pattern of people coming from somewhere else and telling us what we need to do, and then leaving three or four years later.”
But what does this mean in practice, and for substantive changes that provide ample employment, health and security? In addition to the ideas and projects catalogued by Rachel in her last post, what are viable options for communities that struggled economically even when mines were booming, and that remain far from major markets?
We have some ideas (some tested, some aspirational) that might augment the ability of coal communities to transition away from resource dependency. Our ideas are based on interviews with community leaders and our experience in policy research. We hope that they could help coal communities regain some of their prosperity, even under conditions of government austerity.
Microfinance has been both widely lauded and condemned. Its detractors cite instances of predatory lending at high interest rates, ethical conundrums between lending and charitable goals, and cultural stigmas of debt. However, in coal communities, microfinance could be harnessed for non-predatory financing for small business start-ups, or capital upgrades for legacy businesses in rural areas. Other possibilities in this environment include micro-mortgage lending, while direct bank lending to municipalities could finance affordable housing options.
Coal communities in transition face a small tax base but simultaneously the need for infrastructure development and investments in public health and housing. They therefore require access to finance and capital that does not necessarily derive from federal grants.
In a setting with high rates of poverty, but also a percolating start-up movement, microfinance already based in regional hubs, like Denver in the Intermountain West or Lexington and Charleston in Appalachia, and leveraged beyond their usual urban confines, to serve rural investors and entrepreneurs.
Similarly, philanthropy could provide funding opportunities, and bulwark start-ups, but is clustered in metro regions with a greater density of non-profits, and associated urban needs.
Philanthropy is not without its critics and by itself is insufficient to spur wholesale, positive change. Money does not translate into outcomes without sophisticated implementation plans, monitoring and evaluation, and technical assistance that helps convert financing into economic growth. Additional challenges lie in all the intervening forces related to health, education and training.
Any philanthropic efforts must also defer to the expertise of local leaders and other residents, who are in the best position to identify the unique resources and needs in their communities.
With these caveats firmly acknowledged, it is the inequity of philanthropy that distinguishes rural from urban. And again, with vibrant state and local support behind coal community diversification, the timing is ripe to leverage state and even national resources, and steer them towards coal communities.
We are in an era where rural tech can allow for communities that are far from ports or railyards to become economic and employment generators, and it need not usurp local industries nor local identity. Tech can assist municipal planners, monitor public land use, reduce fuel consumption by farmers and plow drivers, alert first responders to weather hazards, and help ranchers track cattle, invasive species and water availability.
Tech can also flow both ways. That is, while most software or relevant apps are designed in urban centers, rural users benefit from a local interlocutor who trains and supports local users. That’s one source of employment. In reverse, a local understanding of challenges and obstacles can spur new development with new end-user goals in mind, and that are most appropriate to rural users. New applications and software can thus derive from the bottom-up, and create new tools relevant to rural users across the country.
Tech also allows for start-ups that can deliver their product remotely – whether accounting or legal services – to coal communities nationwide, for instance, or drone piloting and aerial surveying of abandoned mines, also nationwide, as another for instance.
Though Silicon Valley has prospered in part because of the clustering of venture capital and tech expertise, no doubt, its workforce increasingly telecommutes. Developers and communication experts seek amenities, affordable homes, and community. This is an opportunity for coal communities in transition to attract members of this workforce to their regions.
But there is a hang-up that brings us full circle…
Full Circle, We’re Afraid
The broad premise of this post was to seek pathways outside of conventional public investment for community and economic development in transitioning coal communities. We have cited a few, above. But the positive impact of each would no doubt be magnified in the presence of more robust public finance in the most core functions of local government and local development.
Most obviously, the above discussion of tech hinges on access to robust broadband, which remains mired in political wrangling, and ideological debate. All of the above recommendations will fall short of their potential without this conundrum being resolved, fast.
Even more fundamentally, the the success of the above recommendations hinges on a healthy workforce with access to robust educational and training opportunities to pursue a variety of careers.
Challenges surrounding opioid abuse, shuttered hospitals, and underfunded schools will inhibit microfinance, philanthropy, and tech from permeating rural areas as they should. The telecommuting workforce, meanwhile, will continue to seek already well-off mountain towns, like Boulder or Breckenridge, with those amenities well-established, and protected, rather than transitioning coal communities.
Finally, as Rachel made plain in post #1, public lands require protection and investments. They are the new bedrock amenity for transitioning communities. They provide jobs and revenue, and they will attract more long-term residents over time. Parceling them off to special interests for short-term, unsustainable profits, is a dead-end from the perspective of sustainable community development.
As has become the refrain, effective diversification will require not silver bullets but “silver buckshot.” Public as well as private funds must be invested in our rural towns everywhere, and especially the coal towns working hard to move forward against the tide.
-Rachel Eisenstat and Matt Klick