Southwest Virginia Population decline 2010-2018.

Looking back at the waste of Virginia Tobacco Funds

by Lewis Loflin

As incredible as it may seem the local press believes the nonsense invested below was a great idea in 2004. Sad to say in 2011 nothing has come of any of this. The recent census shows the region is still losing population and the poverty rate has grown or remained flat.

December 06, 2004 Kingsport Times-News

Tennessee, like most states, has long since seen its tobacco settlement monies go up in smoke.

Not so in Virginia.

Three years ago while Tennessee lawmakers were seizing three years' worth of tobacco settlement monies as a stopgap way to plug the state's chronic budget deficit, Virginia lawmakers thoughtfully targeted that state's share of the multi-year, multibillion dollar fund in a variety of innovative ways. Since, the effect of those two widely differing responses to the tobacco settlement has come back to haunt Northeast Tennessee and help Southwest Virginia.

The latest proof of the soundness of that decision lies in a round of recent grant announcements from the Virginia Tobacco Commission, which targets projects as diverse as expanding hair sheep production and marketing to helping fund the second phase of the Ralph Stanley Museum.

The funds, allocated by the Southwest Virginia Economic Development Committee, will be administered in the 2005 fiscal year and total more than $1 million.

Officials with the town of Clintwood, for example, received a $61,000 grant that will assist with phase two completion of the Dr. Ralph Stanley Museum and Traditional Mountain Music Center.

The center, located along the state-designated Crooked Road Heritage Music Trail that stretches from Dickenson County to Galax, held its grand opening this fall and features hundreds of exhibits highlighting the career of the Grammy Award winner and his brother, Carter.

The additional funding will be combined with a grant of almost $140,000 awarded to the town in May for phase two construction.

Update: Wrong. The Ralph Stanley is a failure and had to be taken over by the Town of Clintwood and has to be bailed out again. See Ralph Stanley Museum Fiasco.

Another recipient of the tobacco fund is Appalachian Sustainable Development, an organization helping farmers who grow organic crops, which got $75,000 for a value-added economic development initiative.

Update: Appalachian Sustainable Development has failed and only survived on government grants. See Sustainable Woods wood-processing facility in Castlewood not sustainable

Other recipients include the University of Virginia's College at Wise, which will receive $50,000 to help with its Entrepreneurial Development Program (Pure pork, nothing came of it.);

the Barter Theatre Foundation, which received $75,000 for infrastructure and site development for the Stonewall Square project (Wasted. See Naked;

the Birthplace of Country Music Alliance, $125,544 for the BCMA Cultural Heritage Center (still not completed as of 2011);

Lee County and Lee County Industrial Development Authority, $40,000 for improvements at the Lee County Airport and $200,000 for expansion efforts at the Constitutional Oaks Industrial Park;

Dante Lives On in Russell County, $21,000 toward the construction of the Dante Coal Mining and Railroad Museum (Wasted. Nothing to show in 2011.);

Damascus, $72,000 for phase one of an engineering and marketing plan for the Creeper Trail Campground on Beaver Dam Creek (Wasted. Nothing to show in 2011.);

Lonesome Pine Arts and Crafts, $105,000 for upgrades at the outdoor drama "Trail of the Lonesome Pine" (Wasted. Nothing to show in 2011.);

the Scott County Economic Development Authority, $15,000 for its Leadership Academy Southwest program (Wasted. Nothing to show in 2011.);

and the Scott County Hair Sheep Association, $50,000 for expanding hair sheep education, production and marketing (Wasted. Nothing to show in 2011.).

These projects are merely the latest of numerous economic development projects Virginia's share of tobacco settlement monies have helped make possible. Another recent example is the expansion of Joy Mining Manufacturing. Yet another example is the so-called "e-58'' plan, which is using tobacco monies to fund fiber-optic links in rural communities.

Project by project, lawmakers' foresight in using tobacco monies is making significant contributions to the economic development of Southwest Virginia.

These funds are helping improve the quality of life by bringing high-paying jobs to an area which can certainly use them.

Virginia lawmakers are to be commended for their forward-thinking strategy of investment that has proven itself many times over, one that promises to benefit the region, as well as the state in general.


Copyright 2004 Kingsport Times-News

Printed Kingsport Times-News January 10, 2005

Re: Virginia Tobacco funds (December 6) the Times-News has missed the mark. These funds that should have went for education, health care and economic development have become a ready source of fraud and waste for local Southwest Virginia governments that have produced nothing in the way of real jobs or helped common people.

Tourism doesn't create good jobs, if at all. My relatives in Wise, Dickenson, and Russell Counties know of nothing any of these museums have brought in. Carter's Fold near my home has been given over $500,000 in government grants and hasn't produced a single job.

Bristol Virginia Utilities has received about $5 million in taxpayer funds (about $2.2 million in tobacco funds) touting fiber optic as job creation. In one case they admitted running lines to areas they knew would never produce anything, then kept half the grant ($350,000) for expenses.

All they did was overbuild existing fiber optic infrastructure and have not connected a single customer that didn't get services before. After running up a whopping $50 million in external debt, they have failed to create a single job or bring in a single new business two years later.

Now Bristol, Tennessee is prepared to commit the same stupidity while Bristol, Virginia has the highest electric rate in Tri-Cities.

Another $225,000 went for a seafood restaurant in Bristol. ($175,000 was EDA grants, $50,000 from Bristol Virginia Utilities.) Another Bristol company received $1 million ($500,000 Tobacco Funds) to create 350 "new jobs," but instead we got 600 lays-off s and the company kept the money. Washington County gave away $40,000 for a non-profit retirement community study that produced nothing.

As for Joy Manufacturing in Duffield, explain why they closed their facilities in Washington County, Virginia industrial parks at the same time. Net result was a loss of over 100 jobs and millions in losses to taxpayers.

It's time to stop the waste and use tobacco grants for what they intended for.

Lewis Loflin
Bristol, VA

See Three Decades of Job Losses in Southwest Virginia

Note that minimum wage in 1970 was $1.60 adjusted for inflation is $10.46 in 2018. That is what I call adjusted minimum wage. Assuming one even gets 40 per week that's for 52 weeks that equals $21,756. Per capita income in Bristol Virginia 2018 is $21,589. It is similar to this across the whole region.

Third world? Some have called us the China of America minus jobs.

Just a few of hundreds of plant closings see Smyth County the China of America loses jobs.

Tri-Cities labor market 2007-2016.

Update September 3, 2019. Based on data from Dr. Steb Hipple economist at East Tennessee State University (retired), his data goes to the 3rd. quarter of 2016. The level of job losses is Tri-Cities is staggering, worse than what even I thought.

(The Tri-Cities Consolidated Statistical Area is composed of the Kingsport/Bristol MSA and the Johnson City MSA.).

The Bristol TN-VA, Kingsport, and Johnson City Urbanized Area Labor Market lost thousands of jobs shrinking the labor force that shrank the unemployment rates. The above table shows a decline of labor force by almost 18,000. But it gets worse.

Includes: Johnson City, TN, Carter County, Unicoi County, Washington County.
All workers BLS:
2016 78,140 workers, Median hourly wage $14.47, Annual $40,140
2018 77,020 workers, Median hourly wage $15.38, Annual $42,740
Labor force fell 1120 jobs in 2 years.

Kingsport-Bristol-Bristol, TN-VA MSA includes: Bristol city, VA, Hawkins County, TN, Scott County, VA, Sullivan County, TN, Washington County, VA.

All workers BLS:
2016: 118,470, Median hourly wage $15.27, Annual $41,050
2018: 116,150, Median hourly wage $16.50, Annual $43,480
Labor force fell 2,320 in in 2 years.

That's not the worst of it still. For Tri-Cities the total labor force is 193,170. The labor force shrank by 3,440 jobs in 2 years - during a so-called boom. In 2009 the labor force was 247,965, minus 193,170 equals a staggering loss of 54,795 less people are working in 2019 than in 2009!.

I can't believe this myself. Anyone working here knows it is bad. That could be explained by high poverty and disability rates, and large numbers of retirees leaving the labor force. I don't know because a lot of data is hidden from the public. But makes sense when we look at the national labor force declines.