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An Economic Development Program We Must Consider

One day last fall a father in Belmont County said to me, “I wish my kids wouldn’t leave the valley, but I hope they do.” … and it crushed me. Because some 40 years ago that’s how my mom felt when I left and I remember how sad it made her despite her efforts to hide it.

But she encouraged me to go because, like that dad, she wanted the best for her child — job opportunities and a bright future — even if it meant giving up something dear to her.

It hurts me that, 40 years later, parents and young people in the valley still face the same awful choice. Despite the best efforts of state and local leaders, despite a natural gas boom that was supposed to bring jobs but didn’t, and, more recently, despite claims of an “Appalachian petrochemical manufacturing renaissance” that was supposed to bring 100,000 jobs, but which died as one ethane cracker project after another failed, the valley is still losing jobs and young adults who leave in search of better lives.

That’s why a recent editorial in The Intelligencer called on local and state leaders to look beyond the natural gas and petrochemical industries for other, more viable strategies for achieving job growth. It’s also why I helped found the Ohio River Valley Institute, which is devoted to crafting effective economic and job development strategies that can work in our region.

Remarkably, one has arisen.

Although it’s in the Pacific Northwest, the town of Centralia in Lewis County, Washington for decades looked economically like Wheeling, Bellaire, Waynesburg, and other communities in our area. Centralia is an old coal town of 18,000 people in which a mine was the largest employer along with a coal-fired power plant. Centralia hadn’t seen job growth in 20 years, a period during which the mine closed and the power plant went into a phased retirement, costing the community nearly 1,000 jobs. But something miraculous happened.

At a time when economic catastrophe was expected, Centralia started adding jobs and did so faster than workers were being laid off. In fact, between 2016 and 2019, Centralia and Lewis County, which has a population about the same as that of Belmont County or of the combined Ohio, Marshall, and Wetzel counties, added 2,800 new jobs. In all, the number of jobs in Centralia and Lewis County increased by 12% — twice the rate of job growth nationally. And wages grew 50% faster than the national average.

Think of what it would mean to Belmont County or to Ohio, Marshall, and Wetzel counties if after decades of stagnation and population loss, they added nearly 3,000 new jobs. Think of it because what happened in Centralia may be replicable here.

Centralia achieved these outcomes as a result of a Coal Transition Grant Program that was established and funded by the Canadian company, TransAlta, which owns the coal mine and power plant. In an agreement with the state of Washington, which enabled TransAlta to avoid roughly $100 million in upgrade costs for the power plant, the company is contributing $55 million in grants to individuals, families, businesses, and governments to fund energy efficiency upgrades to homes and buildings, education, and distributed clean electricity generation.

These comparatively small grants trigger powerful economic multipliers. Energy efficiency upgrades — things like insulation, door and window replacement, and HVAC modernization — are highly labor-intensive, which means jobs. The work is performed by local contractors, which keeps the jobs and money in the local economy. The grants also change investment economics for home and building owners who add their own funds and compound the economic impact. And the energy efficiency and distributed generation improvements reduce utility bills both in the present and for years to come.

Over time they pay for themselves and provide increased disposable income, which contributes to more commerce and jobs.

We are close to being able to do something like this in the valley. For instance, had American Electric Power and the West Virginia Public Service Commission decided to retire the Mitchell Power Plant in 2028, AEP like TransAlta would have saved nearly $100 million and might have been prevailed upon to fund a Centralia-scale transition in Ohio, Marshall, and Wetzel counties. In the case of Belmont County, the $70 million that JobsOhio gave PTTGC for the failed ethane cracker project would have funded a Centralia-scale transition plan there.

As The Intelligencer editorial argued, we must explore new economic development options. And the Centralia model is one that cries for consideration. I’m inviting local and state leaders to work with us at the Ohio River Valley Institute to explore this opportunity and, if we’re successful, save parents from having to make the awful choice between what they wish for themselves and what they hope for their children.

To learn more, please contact me at sean@ohiorivervalleyinstitute.org.

Sean O’Leary is a Wheeling native who is senior researcher at the Ohio River Valley Institute.

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