Economic development study offers tough lessons for counties
by By Ralph Davis
PRESTONSBURG — Local government officials and economic development experts got some tough love Wednesday, when the results of an eight-month study of regional recruitment efforts were revealed.
Insite Consulting, out of Greer, S.C., which specializes in economic development, site selection and real estate services, was hired by Kentucky Power late last year to study and make recommendations about economic development efforts in Floyd, Johnson, Knott, Lawrence, Letcher, Magoffin, Martin and Pike counties. Their findings, delivered by Insite princpals Rob Cornwell and Tonya Crist during a luncheon at Jenny Wiley State Resort Park, were not pretty.
Local leaders were taken to the woodshed on almost every point, including a lack of full-time staff devoted to economic development, a lack of industrial recruitment websites to let the world know of opportunities in the area, an unwillingness to spend any funds except coal severance tax on economic development, a lack of suitable industrial sites, an inability to handle requests from companies seeking information, a lack of a centralized database listing available assets, and a pervasive atmosphere of county-to-county competition.
Judge-Executive R.D. “Doc” Marshall attended the meeting and said he found it full of information.
“It was enlightening,” Marshall said of the presentation. “It highlighted a lot of concerns I’ve had for years.”
On the positive side, Cornwell and Crist said the region has some outstanding benefits of which counties should be taking advantage, particularly in the areas of transportation and a skilled workforce. However, they said local leaders seem to believe, mistakenly, that the region cannot compete in those areas.
On the transportation front, Cornwell said Eastern Kentucky’s road system can compete with just about any area of the country.
“You don’t have an interstate, but you have fantastic four-lane, divided highways,” Cornwell said. “And now, a lot of the searches are based on that, because you end up eliminating a lot of quality communities by just doing an interstate search. And so, most of the time, we have in there whether you have access to a four-lane, divided highway. You have that, and it’s fantastic for communities of this size.
“We came up through Virginia, and no offense to the folks in Virginia, but the highway changes in Kentucky, tremendously. It’s like a different world.”
Still, after hearing for decades that Eastern Kentucky’s roads were subpar, Cornwell said local leaders seem to believe the old criticism, despite many advances.
“In terms of talking your strengths, when you talk to people outside this region, don’t let people tell you you’ve got poor access,” Cornwell said. “Don’t let them tell you that. Tell them what kind of money you’ve put into highways.”
The study also found that the region has not done a good job in getting its message out to the world.
“There’s no economic development website for any local economic development group, that makes sense, here, in this region,” Cornwell said. “That’s awful, and we’ve got to change that.”
Crist hammered the point home: “We live three hours away and we didn’t know anything about you!”
Similarly, Cornwell said local leaders suffer from the illusion that the area has a lack of skilled workers, but he said that is simply not the case. He said there is a prevalent belief that the only skilled trade workers in the region are coal miners, but he said those same coal miners have skills that can be used in other industries.
“Some of the mining skill set can be transferable,” Cornwell said. “And we think there’s really an opportunity to promote that in a different way. Can you get 500 skilled welders? Probably not. But can you get folks that’s trained on specialized equipment to run my factory? Can I get 25 of those? I think this region can probably compete there.”
And with the downturn in the coal industry resulting in widespread layoffs, Cornwell said, the region could promote that to new industries as a positive, in that it means there is an abundant supply of skilled workers ready to work.
“If you can show, ‘We’ve got 600 miners that have been laid off within six months and here are there skill sets, and we know that 80 percent of them are still unemployed and looking for a job, and here are their skills,’ that rings real strong for a potential employer …” Cornwell said. “That would impress us. That would impress companies.”
Insite looked at industrial parks in the region and found critical faults with nearly all of them, including parks with inadequate or no sewer service, no natural gas, or inadequate transportation to and from the site. Cornwell and Crist said any one of those problems would cause a company to immediately cross a site off its list, and many of the parks had more than one.
Cornwell and Crist said many of the problems the region faces could be addressed quickly, and they offered one proposal for doing so — creation of a regional economic development authority, dubbed One East Kentucky.
Saying that local communities simply do not have the resources to handle all of the day-to-day tasks required for effective economic development, Cornwell and Crist said the regional authority could handle those tasks, while at the same time working to complement the efforts of local communities. They suggested the authority would need a budget of between $700,000 and $900,000, with $500,000 provided by local governments in the eight counties and the remainder paid through local Chambers of Commerce.
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