ARC’s POWER Initiative has invested millions in projects working to create jobs and new economic opportunities in coal-impacted communities. A barrier to the creation of opportunity, however, is capital access. Without the money and credit needed to start a business, the ideas of home-grown entrepreneurs cannot be put into action – and neither can the local economic benefits.
That’s exactly why ARC partners are using millions in POWER funds to make financial resources accessible for coal communities to strengthen and diversify their economies, on their own terms.
Community-Level Capital Access
For over a decade, Appalachian Community Capital (ACC) has made mission-driven investments to build local opportunity and wealth across Appalachia. ACC doubled down on this commitment through Opportunity Appalachia (OA), which has received ARC POWER funding since 2019 to specifically target capital and technical assistance to coal-impacted communities in five Central Appalachian states: North Carolina, Ohio, Tennessee, Virginia, and West Virginia.
As a result of their first POWER 2019 grant, OA ultimately provided technical assistance to 17 community projects and helped raise $79 million in private capital for those projects, expecting to create 13 businesses and 1,017 new jobs in Central Appalachia. Today, OA is working with 50 total projects to secure $490 million for downtown development, manufacturing, IT, healthcare, education, food systems, clean energy, and heritage tourism and recreation in underserved communities. Four projects have already obtained financing commitments, purchase agreements, or anticipate financial closing by Q1 2024, totaling $21.6M of investment, and an additional 10 projects are actively seeking $52M in financing with the balance of projects still structuring their capital raise.
Thanks to another $1.5 million POWER 2023 grant, OA will expand its support even further, adding up to thirty coal-impacted communities to their portfolio. Funds will help communities identify high-impact projects and assist them in the development of prospectus materials, creation of project pitch videos and presentations, and connection with pre-vetted investment sources. OA expects to attract up to $150 million in private investment to participating Central Appalachian communities.
“The grant will enable us to expand our Opportunity Appalachia program, adding the highly distressed communities of East Kentucky to the service area, increasing focus on developing affordable/workforce housing, and creating a mentorship program to assist lower capacity communities successfully develop opportunities,” said ACC President and CEO Donna Gambrell.
Making Capital Access More Equitable
While OA secures investment for larger-scale, other ARC partners are making capital available to local businesses and organizations. In Eastern Kentucky, Mountain Association received $1.5 million to support underserved small businesses, nonprofits and local governments in coal-impacted areas. The project focuses on a new engagement model for lending that focuses on the entrepreneur’s passion and vision, rather than a traditional lending model that prioritizes things like credit scores and collateral. Additionally, Mountain Association will provide one-on-one technical assistance and group trainings on clean energy implementation, web design, and other activities that can support small business success. By the project’s completion, they expect to improve 220 businesses and create 120 jobs.
Over in West Virginia, the Tamarack Foundation is using nearly $31,000 to develop a three-year comprehensive plan for an Arts Business Accelerator. Once launched, the accelerator will provide arts businesses in southern West Virginia with financial literacy workshops, business education, and other tools and resources required for growth. As more communities look to develop cultural and creative economies, supporting entrepreneurs in this sector – many of which may also be considered “high-risk” business clients – is critical.
“To make our communities stronger, we have to make business ownership more accessible to those who are often unable to access support from traditional lenders,” said Mountain Association President Peter Hille. “Alongside our partners at ARC, we are developing new, more effective ways of getting capital and other supporting resources to the people who want to start something new in their community.”
Appalachia’s coal communities are brimming with creative ideas and economic potential – they just need the resources. ARC POWER partners are closing those capital gaps and empowering Appalachians as they revitalize, reenergize, and re-envision their home.
Learn more about the $54 million ARC’s POWER Initiative awarded to coal-impacted communities in October 2023. This is the largest single POWER investment package since the initiative’s launch in 2015.