BIG STONE GAP — The first of three planned public input meetings on Virginia’s coal tax credits phaseout brought a range of ideas on how to use the revenue windfall.
Virginia Department of Mines, Minerals and Energy officials hosted the session Tuesday at Mountain Empire Community College, with the agency’s Policy Director Michael Skeffington outlining how public input will be used to report to the Virginia General Assembly on how to use the revenue.
A Sept. 2020 state Joint Legislative Audit Review Committee report to the General Assembly found that the credits, for employment in mining Virginia coal and for using Virginia coal for energy production, “generated loss for the state and were no longer relevant,” Skiffington said before public comment began.
A work group including the Virginia Coalfield Economic Development Authority (VCEDA), Virginia Economic Development Partnership, Virginia Employment Commission, Southwest Virginia Workforce Development Board and the state Council on Environmental Justice will review comments before completing a draft report by Sept. 1 and a final report to Gov. Ralph Northam by Dec. 1.
Jonathan Belcher, VCEDA executive director, opened comments by pointing to an almost four-decade reliance on coal and natural gas severance tax revenue to fund its economic development efforts.
Severance tax revenue in recent years has dwindled, Belcher said, and that makes any revenue after the tax credit phaseout in two years critical for VCEDA continuing to help attract new businesses to Southwest Virginia.
“VCEDA was probably the re-energize Southwest Virginia from the early 1980s,” Belcher said, adding that the authority has used that funding for several economic development projects across the region.
Gov. Northam in April proposed that much of the windfall from phasing out the credits go to UVA Wise to develop technology programs. That proposal was removed from the final version of the legislation that Northam signed.
Will Payne, director of public-private economic development effort InvestSWVA, said the region needs to change how it has worked to attract development prospects to the region.
Payne said InvestSWVA stemmed from discussions between state legislators Terry Kilgore, Todd Pillion and the late Ben Chafin on how to build partnerships outside the region.
“What could they do to drive change here at home?” Payne said. “Because the days of waiting for the phone to ring are over. Time has changed, money has dried up, and industries have deserted the region.”
Payne said those efforts since 2019 have led to projects to identify suitable data center sites in Southwest Virginia and for agricultural development for a craft brewing industry.
Janet Settle, lobbyist for the Heart of Appalachia Tourism Authority and Spearhead Trails, said she wanted to see VCEDA get funding from the tax credit phaseout to continue its work. She pointed to the authority’s support of tourism development efforts leading to Heart of Appalachia’s establishment and continuing support of tourism development and related businesses.
“Don’t throw the baby out with the dishwater,” Settle said.
Chelsea Barnes, legislative director for Norton-based advocacy group Appalachian Voices, first asked DMME officials to make the remaining meetings more accessible to the public. She cited the scheduling of Tuesday’s meeting with a two-week lead time for announcement and on an election day.
Barnes said the DMME workgroup should consider the employment and local real estate tax impacts as coal-fired power plants in the state shut down. Even the Dominion Energy plant near St. Paul, while being allowed to operate until 2045, is not running at full capacity, Barnes said.
Reclamation of abandoned mine land also needs consideration by the workgroup since many mine companies have forfeited bonds for reclamation as they shut down or go bankrupt, Barnes said.
Southwest Virginia Workforce Development Board Assistant Director Rachel Patton commented remotely, saying that revenue after the credit phaseout should also go to retraining efforts among displaced mining economy workers.
30th Judicial Circuit Court Judge Jeff Hamilton asked the workgroup to consider expansion of the University of Virginia’s College at Wise by 4,000 students as part of a larger effort to encourage state agencies to move to Southwest Virginia.
Hamilton said large corporations and their workers would not see Southwest Virginia as a preferable place to work and live.
“If they don’t want to work here, we can hire people here,” Hamilton said, adding that state agencies in Richmond could free up office space for those large corporations by moving operations to Southwest Virginia.
Skiffington said the dates for the remaining two input meetings will be announced soon, with Clintwood and Richlands being the likely sites.