CHARLESTON -- West Virginia has relied on coal production for years to support communities, but regulations and increased competition have dented that prospect as thousands of jobs have been omitted.
However, legislation proposed by U.S. Sen. Shelley Moore Capito, R-W.Va., aims to revive rural economies.
Called Creating Opportunities for Rural Economies (CORE) Act, this legislation would leverage available tax credits to support new investment and business development in distressed communities across West Virginia.
Since elected to office two years ago, Capito has traveled the state speaking with business leaders, employees, local government officials and others to see how they are utilizing federal incentives for economic and community development in the public and private sectors. She discovered most of them knew nothing about the New Markets Tax Credit program, which is operated through the U.S. Treasure Department and launched in 2000 to provide incentives to invest in projects in low-income communities.
The program specifically supports investment in projects that include mixed-use redevelopment projects, health care facilities, manufacturing facilities and direct investments in businesses. Investors receive a 39 percent tax credit over a seven-year period in return for investing in these communities.
However, only 17 projects totaling $97 million have been invested in in West Virginia through the program, even though more than $40 billion has been claimed for projects in other states across the country. Kentucky has received more than $730 million in new market tax credit investment, Ohio has received more than $1.9 billion and Pennsylvania has received nearly $1.4 billion.
“The program’s level of complexity often prevents people from pursuing these tax credits,” spokeswoman Ashley Berrang told The West Virginia Record. “The senator’s focus is twofold. One, let’s break down these barriers and make sure people across West Virginia know this program exists, and two, let’s educate West Virginians about what types of projects are eligible for the tax credits and ensure that the communities that need the help the most are getting their fair share of this program’s funding.”
In the next three years, $10.5 billion in new market tax credits will be funneled to projects across the nation. The CORE Act will set aside 5 percent annually for similar investments to be made in 12 states like West Virginia that would be identified as “under served.” Berrang noted this is an issue that exists in other states too. The other 11 states experiencing significant coal job loss from 2012 to 2015 include Alabama, Colorado, Kentucky, Indiana, Illinois, New Mexico, Ohio, Pennsylvania, Texas, Utah and Virginia.
“It’s a bipartisan issue with a lot of conversations going on both here in Congress and among folks in the administration,” Berrang said. “The need to support economies in these distressed communities was also a central issue on the campaign trail throughout the presidential election."
In West Virginia, for example, there are 32 counties out of 55 that would be eligible for tax credits under the CORE Act, Berrang said. Capito’s camp anticipates board support for the bill.
“We are very optimistic about the prospects for this bill and the benefits it would bring to several communities in West Virginia,” she said.