State

They hoped to make Eastern Kentucky’s economy SOAR. Five years on, progress is slow.

SilverLiner LLC., a tanker truck manufacturing company, is building a plant in the Kentucky Enterprise Industrial Park in Pikeville. Other companies scheduled to locate in the park, including the proposed battery plant Enerblu, have experienced delays and have yet to begin construction.
SilverLiner LLC., a tanker truck manufacturing company, is building a plant in the Kentucky Enterprise Industrial Park in Pikeville. Other companies scheduled to locate in the park, including the proposed battery plant Enerblu, have experienced delays and have yet to begin construction.

Born out of desperation, an effort to galvanize Eastern Kentucky’s leaders around a vision for reshaping the downtrodden region’s economy will hold its fifth annual summit this week in Pikeville.

While officials and business leaders agree the region has improved since 2013, when Shaping Our Appalachian Region rose from the rubble of a collapsing coal industry, some of the summit’s most notable endeavors include factories not yet built, a state-led broadband project facing long delays, and efforts to curb a drug epidemic that continues to plague the region.

SOAR officials described the group’s role as a champion of ongoing and promising projects, and as a meeting place where political and business leaders gather to discuss the region’s problems and corresponding solutions. But after five years, quantifiable progress seems slow to come.

“What have we got to show for it? I think everybody would say not enough,” said Peter Hille, president of MACED, an economic development group founded in the 1970s to improve the quality of life in Central Appalachia. “That doesn’t mean we shouldn’t keep going, it means we should redouble our efforts.”

According to the East Kentucky Works Survey, which analyzed demographic data in the region, the unemployment rate improved between 2011 and 2016, from 11.5 percent to 8.8 percent. The labor force, however, decreased by nearly 29,000, from about 216,000 to 187,000.

In some counties, data from the Eastern Kentucky Concentrated Employment Program shows that poverty rates also increased in recent years. In Bell County, which has the highest poverty rate in the region, the rate increased 6.7 percentage points between 2015 and 2016 to 44.7 percent.

SOAR formed in a year when coal employment numbers plummeted nearly 30 percent in Eastern Kentucky. The hardest hit counties — including Breathitt, Whitley and Knott — lost more than 60 percent of coal jobs from 2011 and 2013.

“Its collapse, near collapse, left us with the notion that we had to find something to take its place, supplement it,” U.S. Rep. Hal Rogers said of the coal industry. Rogers, a Republican, represents Kentucky’s 5th Congressional District, which includes most of Eastern Kentucky.

In December 2013, just as the Herald-Leader concluded a more than year-long series on the continuing woes of Eastern Kentucky, the region’s leading minds met at the first SOAR summit and subsequently developed a blueprint for its future. The blueprint lays out goals and strategies for transitioning to a more diverse and stable economy.

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Tim Buckingham, a staffer with the citizens group Kentuckians for the Commonwealth, listened during the Shaping Our Appalachian Region summit Dec. 9 at the Expo Center in Pikeville.

Among its objectives: increasing broadband connectivity through Eastern Kentucky; facilitating workforce development training; supporting business opportunities; and reducing health concerns, including obesity and drug abuse.

The blueprint also lays out plans to build up industry, agriculture and tourism opportunities in Kentucky’s Appalachian counties.

Kimberly McCann, chairwoman of SOAR’s executive board, said high-speed internet is a key factor in the future of Appalachian Kentucky.

“I think that’s vital to open the region up, just as the highways did many years ago,” McCann said.

Teleworks USA, a program run through the EKCEP, is one of the primary examples officials use to illustrate the potential that broadband could offer in the region. The program trains people for work-from-home jobs, such as customer service or taking reservations for companies like U-Haul.

Since 2015, Teleworks USA has placed more than 1,750 Eastern Kentucky residents in work-from-home jobs, said Michael Cornett, an official with EKCEP.

Residents in some areas, though, can’t get those jobs because of poor internet connectivity.

“It does limit what we can do,” Cornett said. “We could be doing better if the internet was better in those communities, and we could be doing it in more communities.”

So far, Teleworks USA has eight training hubs in Eastern Kentucky. Follow-up surveys have found that 60 to 70 percent of people placed in jobs through the program hold on to them, Cornett said.

At least part of Teleworks’ future could rely on the progress of Kentucky WIRED, an initiative launched in 2015 by then-Gov. Steve Beshear and Rogers to deliver high-speed internet to all of Kentucky’s 120 counties.

The project, though, is long behind schedule, with one legislator saying it has went tens of millions of dollars over its $324 million budget.

Other important projects in SOAR’s network have also yet to be completed.

Those include: Enerblu, a battery plant planned for an old mine site in Pike County; Braidy Industries, an aluminum mill planned for Greenup County; and SilverLiner, a tanker truck manufacturer, also planned for Pike County.

Xavier Guerin, Enerblu’s chief marketing officer and one of its co-founders, said the company has hired about 25 people at offices in Lexington, but said some of the geotechnical aspects of building on an old mine site have proved more difficult than expected.

“It’s very difficult to build on old mines,” Guerin said. “Every week we have meetings with the architects. They keep finding new issues.”

Still, Enerblu hopes to begin construction by the end of the year, Guerin said.

The company plans to employ about 875 full-time workers.

Jared Arnett, SOAR’s executive director, said though some projects have yet to get off the ground, the SOAR summit provides a way for the community to approach those companies and ask about their progress.

In addition, Arnett said, SOAR wants to encourage companies like Enerblu to take risks by investing in the region.

“We don’t want to discourage people from taking risks, because that’s what this whole thing is about,” he said. “As long as they’re making progress, and they are, and they’re still committed, we’re going to support them.”

Jared Arnett, director of Shaping Our Appalachian Region (SOAR), says high-speed internet access will bring great economic opportunity to Eastern Kentucky.

During the summit, SOAR will show videos highlighting what Arnett said are four of its biggest successes — projects that began as ideas at a SOAR summit, and have since come to fruition.

One of those is an incentive program for downtown Pineville in Bell County, which Arnett said has helped create a 100 percent occupancy rate in downtown buildings, $8 million of investment and 200 jobs.

“The call is, ‘What’s your idea today?’” he said. “When you decide to do it, we’re going to push you to the end and do everything we can to make it successful.”

Hille, with MACED, said SOAR provides a centralized venue where regional leaders can meet, discuss their successes and failures, and find solutions on a local level to regional problems.

“It’s not, by itself, going to create the change,” Hille said. “How well it works depends on how people use it.”

Rogers said progress on diversifying Eastern Kentucky’s economy hasn’t come as quickly as he would have liked, but he thinks the SOAR initiative is making a difference.

It has raised awareness of the need to recruit industries, encouraged entrepreneurs, provided a platform for people to take part in building the future of the region and given people hope, he said.

The job requires nothing short of building a new economy after the sharp decline of one industry that dominated the region for a century, Rogers said.

“We’re trying to diversify and that’s by nature going to take a long time,” Rogers said. “I am seeing an attitudinal change, and I’m seeing pieces of an economic recovery begin to take place.”

Will Wright is a corps member with Report for America, an initiative of the GroundTruth Project. Reach him at 859-270-9760, @HLWright

Bill Estep: 606-678-4655, @billestep1

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