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Will Trump’s Budget Call for Axing an Agency That Works to Assist Appalachia?

Monessen, Pennsylvania

Monessen, Pennsylvania Bill Lucia / RouteFifty.com

 

Connecting state and local government leaders

Such a plan would align with previous proposals from GOP lawmakers and the Heritage Foundation.

Cuts to the Appalachian Regional Commission are considered to be a possibility in President Trump’s forthcoming budget proposal and have been pushed in the past by conservative groups and Republican lawmakers.

But Earl Gohl, the economic development agency’s federal co-chair, offered no hints last Friday as to whether he was uneasy about what might be in store for the commission. “We’re here doing our work,” he said. “We’re engaged with a variety of projects.”

“The rest of the news will catch up to us,” he added during a phone interview with Route Fifty.

Gohl declined to discuss what, if any, information he had seen from the White House Office of Management and Budget about the Trump administration’s budget plans for the commission.

The White House is slated to deliver a budget blueprint, dubbed a “skinny budget,” to Congress later this week. The president’s proposal is expected to include reductions for a range of domestic programs, in addition to a promised $54 billion boost in defense spending.

Prior news reports have highlighted ARC as an agency that could get slashed.

The agency was provided $146 million of funding for fiscal year 2016. That amount included $50 million for the Obama administration’s POWER, or Partnerships for Opportunity and Workforce and Economic Revitalization, initiative, which is aimed at areas affected by economic downturns linked to the coal industry—a common problem in parts of Appalachia.

To help put the agency’s budget numbers in context compared to other federal spending, a recent Pentagon order of 42 F-35A fighter jets cost about $102 million per aircraft.

‘Duplicative Carve-Out’

If a proposal emerges in Trump’s budget to cut the Appalachian Regional Commission’s spending, or to kill the agency entirely, it would not be a new idea.

Last April, U.S. Sen. Joni Ernst, an Iowa Republican, sponsored an amendment that would have eliminated funding for the commission. She said in a news release around that time that ARC was “duplicative” and “only serves a certain region of the country.”

Ultimately the amendment failed with with 28 Republicans joining 42 Democrats to vote against it and 25 GOP senators and zero Democrats voting in favor of the measure.

The Heritage Foundation’s Blueprint for Balance, A Federal Budget for 2017 called for eliminating ARC, referring to it as a “duplicative carve-out.” Trump’s team announced in January that Paul Winfree, previously an economist with the foundation, would serve as deputy director of the Domestic Policy Council and director of budget policy for the White House. 

The Fiscal Year 2017 Blueprint for a Balanced Budget 2.0 from the Republican Study Committee called for axing ARC as well, along with similar commissions centered around other regions.

“Not only,” it says, “is the federal government out of money, but also it is ill-equipped to adequately prioritize local infrastructure and development projects. These activities are also more appropriately carried out by state and local governments.”

Newfound Gap, Tennessee (Shutterstock) 

Self-described as a “conservative caucus of House Republicans and a leading influencer on the right,” the committee in the last Congress counted among its members Mick Mulvaney, who was a congressman from South Carolina, but now leads the Office of Management and Budget.

Criticism of the commission goes back decades.

“Over the years $6.4 billion has been spent on this program,” then-U.S. Rep. Craig Thomas, a Wyoming Republican, said about ARC during House debate in 1994. “And it has shown a propensity for growth—what started out as a program covering 360 counties in 11 states has grown to 399 counties in 13 states,” he added. “I guess we cannot get this porker away from the trough.”

‘Would Never Have Happened’

Formed in 1965 under President Lyndon Johnson, the Appalachian Regional Commission involves a partnership between the federal government and 13 states10 of which Trump won in last year’s election. The region the agency focuses on spans 420 counties that stretch along the Appalachian Mountains, from southern New York to northern Mississippi.

“The rest of the country really benefited to a really great extent from the coal that was produced in those mountains,” Gohl said. “Skyscrapers were built, electricity was generated, cars were made and much of it started as mountains, with people digging coal out.”

The Appalachian Regional Commission has awarded funding to a variety of initiatives.  

For instance, a $950,000 grant went to Mountain Empire Community College, in Big Stone Gap, Virginia, for a program to train people to become power utility linemen. And $1.9 million went to Bevill State Community College’s campus in Jasper, Alabama, to support a “Rapid Training Center” focused on welding, commercial trucking, rigging and other fields growing locally.

Another example is a $2.7 million POWER grant, awarded last August, that helped support TechHire Eastern Kentucky, or TEKY. A public-private partnership, the program gives Kentuckians a chance to learn computer coding and programming skills and to then transition into paid apprenticeships with a Louisville-based software development firm, Interapt.

Thirty-five TEKY participants moved on to apprenticeships with the company and the program will soon accept a second round of applicants, according to Interapt CEO Ankur Gopal.

On Monday, the group Shaping Our Appalachian Region, or SOAR, led an event in Paintsville, Kentucky, that highlighted TEKY and featured other discussions about developing a tech-savvy workforce in the eastern part of the state, where the coal industry has deteriorated.

Among those in attendance were SOAR co-chairs, Kentucky Gov. Matt Bevin, a Republican, and U.S. Rep. Hal Rogers, also a Republican, who represents much of eastern Kentucky.

U.S. Rep. Ro Khanna, a Democrat who hails from a district in California’s Silicon Valley, was also on hand.

In an emailed statement to Route Fifty in December of last year Bevin said: “The TechHire East Kentucky program is a model for the rest of the world on how cutting-edge technology and collaboration can have a huge impact on a region’s economy.”

Gopal noted by phone Friday that the program “would never have happened without the ARC.” Going forward, the goal is to get more companies involved that can contribute private investment so TEKY becomes workable without government dollars.

But “in order to get to sustainability,” Gopal said, “you have to have initial investment.”

“This is not a program that’s going to be funded forever from ARC,” he added. “But to start it, absolutely, it needed it.”

‘Leaving Some Folks Behind’

Gohl contends that the commission has made strides in Appalachia but its work is unfinished.

He explained that the number of counties with poverty rates well in excess of national levels has dropped to 84 from 291 since the 1960s and points out “we used to measure people’s education levels in Appalachia by the percentage of folks who graduated from the fifth grade.” Today, he said, the percentage of high school graduates is nearing the national rate.

“Poverty has been reduced within the region,” he said.

But income levels for families in Appalachia still fall about 12 to 13 percent short compared to the rest of the country, according to Gohl. “We’re leaving some folks behind,” he added.

While that may be so, to what extent the Trump administration and the GOP-controlled Congress will provide federal dollars to the Appalachian Regional Commission and its efforts to improve the economic fortunes of the region remains to be seen.

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Bill Lucia is a Senior Reporter for Government Executive’s Route Fifty and is based in Washington, D.C.

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