Southside-Southwest Virginia Barriers to Infrastructure and Supply Chain Investment (House Document No. 4)
Summary
This March 2023 report of the Virginia Economic Development Partnership to the Governor and the General Assembly of Virginia (House Document No. 4) examines barriers to infrastructure and supply chain investment in Southside and Southwest Virginia. It states that the General Assembly, in House Bill 894 from the 2022 Session, tasked VEDP with determining whether such barriers exist, and that VEDP engaged with over 50 partners. The report states that over $2.2 billion in Gross Domestic Product (GDP) and 60,000 jobs disappeared from four key industries, furniture, textiles, tobacco, and mining. It identifies five core challenges, including limited economic development staff, lack of available workforce, and a limited portfolio of prepared sites and buildings.
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“Southside-Southwest Virginia Barriers to Infrastructure and Supply Chain Investment (House Document No. 4).”
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REPORT OF THE VIRGINIA ECONOMIC
DEVELOPMENT PARTNERSHIP
Southside-Southwest Virginia
Barriers to Infrastructure and
Supply Chain Investment
(Chapter 488, 2022)
TO THE GOVERNOR AND
THE GENERAL ASSEMBLY OF VIRGINIA
HOUSE DOCUMENT NO. 4
COMMONWEALTH OF VIRGINIA
RICHMOND
2023
Norris Built Fabrication, Welding & Machine Shop, Norton Institute for Advanced Learning and Research, Danville
Grayson Highlands State Park
Southside-Southwest Virginia
Barriers to Infrastructure and
Supply Chain Investment
March 2023
Table of Contents
EXECUTIVE SUMMARY 1
Defining Southwest, Southside, and Rural Virginia in this Report 4
DRIVERS OF INFRASTRUCTURE AND SUPPLY CHAIN INVESTMENT 6
Foundations of Economic Development 7
Assets for Economic Development 8
ECONOMIC CONTEXT FOR BARRIERS TO INVESTMENT
IN SOUTHWEST AND SOUTHSIDE 10
Historical Economic Challenges 11
Recent Trends Signaling Future Opportunity 16
ASSESSMENT OF BARRIERS AND RECOMMENDATIONS TO ACHIEVE
ADDITIONAL INFRASTRUCTURE AND SUPPLY CHAIN INVESTMENT 20
Virginia’s Rural Funding Landscape 21
Capacity in Economic Development 25
Workforce 28
Workforce Supply and Development 28
Housing 34
Childcare and Healthcare 38
Talent Attraction Amenities 41
Site and Building Development 42
Infrastructure 48
Incentives 56
CONCLUSION 59
ACKNOWLEDGMENTS 61
NOTES AND SOURCES 64
Executive Summary
The General Assembly, in House Bill 894 from the 2022 Session, tasked the Virginia Economic Development
Partnership (VEDP) to determine whether barriers exist for infrastructure and supply chain investments in
Southside and Southwest Virginia. The bill also requested a review of incentives that the Commonwealth and
its localities should utilize or develop to retain businesses and promote new infrastructure and supply chain
investments.
To accomplish this, VEDP leveraged data from a variety of sources and engaged with over 50 partners,
including local governments, economic developers, regional organizations, academic institutions, nonprofits,
private sector companies, and state agencies (See Acknowledgments on page 62 for a complete list of
partners). Using this information, VEDP developed a report outlining barriers that exist and provides
recommendations on how to address those barriers.
Many of the challenges facing Southwest and Southside Virginia today stem from the decline of four key
industries — furniture, textiles, tobacco, and mining. The region has seen a loss of production and employment
over the last four decades, beginning in the 1980s. Across Southwest and Southside, over $2.2 billion in Gross
Domestic Product (GDP) and 60,000 jobs disappeared from just those four industries alone. Due to the high
concentration of these industries in the region, the loss of these industries led to the general decline of the
regional population and economies of Southwest and Southside Virginia.
The state has authorized and funded several organizations dedicated to filling the void left by the private sector
losses. Tobacco Region Revitalization Commission (TRRC), established in 1999 using proceeds from the
national tobacco settlement, has funded $1.4 billion in projects throughout the region and attracted over
21,000 jobs. The Virginia Coalfield Economic Development Authority (VCEDA), established in 1988 to diversify
seven counties in the coal-producing region of the state, invested over $260 million in projects creating over
23,000 direct jobs. In partnership with regional and local economic developers, both organizations developed
workforce, site, and other infrastructure assets over several decades, yielding benefits to the region today.
Other state entities, such as the Department of Housing and Community Development (DHCD), Virginia
Housing, VEDP, the Center for Rural Virginia, Planning District Commissions, community colleges, universities,
and higher education institutions, have contributed additional support to developing critical assets and
attracting private sector investment. Even with the economic challenge placed on this region, the people here
have demonstrated creativity, resiliency, and innovation to build for the future.
The groundwork laid by economic developers, regional organizations, TRRC, and state agencies so far
represents one part of what will be needed for economic transformation in the region. In recent years,
Southwest and Southside are starting to see the benefits of these investments, with changes to migration
patterns, the lowest unemployment in the state, and recent project wins indicating a new direction for the
regions. The success of these investments and recent positive trends demonstrate that Southwest and
Southside’s economic challenge is not insurmountable. Even with this momentum, additional long-term focus
and investment will be required to sustain and accelerate the positive trends we are seeing and to overcome
the remaining barriers to infrastructure and supply chain investment in Southwest and Southside Virginia.
Southside-Southwest Virginia Barriers to Infrastructure and Supply Chain Investment | 2022 1
This report frames the barriers through the lens of private companies that could make investments in the
regions and the economic developers responsible for laying the groundwork for those investments. It is
important to note that while the report focuses on Southwest and Southside Virginia, many of the challenges
and solutions discussed apply to rural areas across the state. Where possible, the study highlights challenges
that apply to rural Virginia broadly.
The review of barriers to infrastructure and supply chain investment in Southwest and Southside identified five
core challenges and determined actionable recommendations for each for policymakers to consider. Those
areas are:
■
Limited economic development staff
■
Lack of available workforce, driven by:
— Limited workforce development program capacity
— Lack of workforce housing
— Lack of childcare and healthcare facilities
— Limited amenities for attracting new talent
■
Limited portfolio of prepared sites and buildings
■
Remoteness from key infrastructure
■
Competitive business incentives
The recommendations in this report address the above challenges and highlight priorities for supporting
economic growth in Southwest and Southside Virginia. Many recommendations involve adding new or
modifying existing programs to address key challenges. With a few exceptions, this report does not specify
which agencies or existing programs would be best suited for a given recommendation and leaves the decision
to the discretion of policymakers. Any actions taken to implement recommendations from this report should
focus on making programs accessible for recipients and flexible to address the full scope of the specific
challenges identified. Programs that are too burdensome or complex may discourage distressed localities with
limited resources from using them. Additionally, one size fits all solutions will restrict the potential impact of the
investment for localities with diverse needs and will not be nimble enough to address new challenges that will
inevitably arise.
Table 1 on the next page lists the recommendations in this report. Additional details are provided on each
recommendation in the body of the report. Each recommendation directly addresses the major barriers to
infrastructure and supply chain investments in Southwest and Southside Virginia. It should be noted that a
piecemeal approach to implementing these recommendations is likely to yield limited results. A multi-pronged
approach that combines efforts to address each of the underlying challenges would help maximize the
economic growth generated by these recommendations.
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Table 1
Recommendations for consideration
Category Recommendations
Capacity in Economic A. Develop a new program that funds staff, training, and technical resources to
Development increase local and regional economic development capacity in Virginia
Workforce B. Expand GO TEC and continue to fund programs like the Virginia Talent Opportunity
Partnership (VTOP), Innovative Internship Fund and Program, and dual enrollment
(Includes supporting pathways that expose students to manufacturing and other high-demand
issues such as industries
housing, childcare,
healthcare, and quality C. Expand eligibility for G3’s Student Support Incentive Grant (SSIG) to part-time and
of life) non-Pell Grant students, providing more support to working students with non-
tuition costs, like transportation, childcare, and other needs
D. Expand advising and career coaching capacity at institutions with higher rates of
part-time students using credentialing programs supported by G3 and Fast Forward
E. Provide permanent and flexible capacity-building funding for post-secondary
institutions to develop and/or expand responsive training programs for private
sector businesses
F. Modify existing program parameters and/or develop a new program that funds
community investments in pre-development housing infrastructure in rural Virginia
G. Maintain or expand Virginia’s Historic Rehabilitation Tax Credit to further
incentivize development among a variety of historic building types in rural areas
H. Modify existing program parameters and/or develop a new program that funds
community partnerships with private and nonprofit sector investments in childcare
and healthcare capacity in rural Virginia
I. Maintain existing enterprise zones in Southwest and Southside Virginia
Site and Building J. Increase funding for site development in the Commonwealth
Development K. Develop a program(s) that funds community efforts to develop shell buildings and
source new sites
Infrastructure L. Expand capacity in local, regional, or state organizations to pursue additional
federal and state infrastructure funds (see Recommendation A)
M. Leverage federal infrastructure funding to accelerate the development of planned
interstates, highways, and expressways in Southwest, Southside, and other rural
areas of Virginia
N. Continue exploring the feasibility of additional inland ports in the Commonwealth
Incentives O. Establish a manufacturing job creation tax credit that further incentivizes
economic development in rural communities
P. Develop opportunities to expand and fund transparency and speed in permitting
programs
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Defining Southwest, Southside, and Rural Virginia in this Report
For data analysis purposes, this study defines “Southwest” as the counties and independent cities contained in
GO Virginia Region 1 and “Southside” as the counties and independent cities contained in GO Virginia Region 3
(Figure 1). The insights and recommendations to follow are applicable to counties beyond these two GO Virginia
Regions that consider themselves included in either the Southwest or Southside geographies. Additionally, many
of the insights and recommendations to follow will apply to rural localities and regions in Virginia outside of the
study’s geographic bounds.
Figure 1
Southwest (GO Virginia Region 1) and Southside (GO Virginia Region 3) study regions
The analysis in this report also compares the study regions to other areas of the state for context. To demonstrate
the unique differences between the study regions and other areas of Virginia, the report created groups of counties
based on the percentage of people living in rural or urban areas. The report uses the terms “Rural” (0–25% urban),
“Mixed Rural” (25–50% urban), “Mixed Urban” (50-75% urban), and “Urban” (75–100% urban) to classify localities.
Due to data constraints that work to streamline Virginia’s unique independent city system, some analyses in this
report pair independent cities with a county. When that is the case, the combined city/county percentage of the
rural population will determine its category.
The Southwest and Southside regions are almost exclusively rural (Figure 2). When making data comparisons
to the study region of Southwest-Southside, the report will classify “Other Rural-Mixed Rural” localities
outside of the study regions as a group. The report will also discuss “Mixed Urban” and “Urban” localities as
separate groups.
Southside-Southwest Virginia Barriers to Infrastructure and Supply Chain Investment | 2022 4
Figure 2
Urban and rural counties defined by percent of rural population
Rural (greater than 75% rural)
Mixed Rural (50–75% rural)
Mixed Urban (25–50% rural)
Urban (less than 25% rural)
Source: 2010 U.S. Census1
The economy of Southwest and Southside Virginia is also unique in the state. For reasons discussed in the
next section, the regions have a small population and GDP and the state’s lowest labor force participation rate
(See Table 2). These regions have a larger proportion of manufacturing workforce (13%, compared to a total
working age population of 9%) and a smaller proportion of IT/Professional service workers compared to other
areas of the state.
Table 2
General information about the groupings used in this report, based on 2020 data
Other Rural/
Category Southwest Southside Mixed Rural Mixed Urban Urban
Land area (mi2) 6,010 6,798 18,621 6,103 5,220
Working-age population (16–64) 223,635 222,661 688,087 729,087 3,661,639
Labor Force Participation Rate 49% 52% 60% 63% 70%
GDP ($B) 19.6 19.0 58.7 83.9 468.0
Manufacturing workforce 14,601 14,656 35,059 55,193 105,087
IT/Professional Services 6,042 4,424 20,814 31,048 454,421
workforce
Source: U.S. Census2; Moody’s Analytics3; VEDP analysis
Southside-Southwest Virginia Barriers to Infrastructure and Supply Chain Investment | 2022 5
Drivers of Infrastructure
and Supply Chain
Investment
6
Drivers of Infrastructure and Supply Chain Investment
Foundations of Economic Development
At the root of this study is the question of how to overcome barriers that will lead to infrastructure and supply
chain investment — essential outcomes of economic development. The recommendations in this report are
based on the core principles underpinning economic development and its potential to impact communities.
The four foundational ideas that lead to the recommendations described in this report are:
Foundation #1: All places should pursue economic development to maintain or improve the lives of people in
their community.
The core ideas and practices of economic development apply to every locality and region — including the
ones that do not want to grow in population. Economic development can, and often does, lead to growth.
However, economic development can also lead to transformation without new growth. Localities and regions
can help existing companies adapt to new technologies to remain competitive and work to diversify industries
in the region to ensure the long-term health of the economy. Efforts to strategically transform the economy
are necessary to prevent long-term economic decline when a local industry moves overseas or shrinks due to
advancements in technology. Therefore, even a locality that wants to maintain its size can — and should — think
strategically about economic development as a lever for positive transformation.
Foundation #2: Economic development occurs through business attraction, business expansion, or
entrepreneurial/startup growth
Economic development can occur through three avenues. First, a new company can choose to locate a facility
in a region. Many state, regional, and local economic developers work to attract new firms through marketing
initiatives or direct outreach. Second, existing companies in a region will often expand. Ideally, economic developers
are interfacing with their current companies to help facilitate potential expansion needs. Third, people can launch
new businesses/startups that will grow, with economic developers providing financial and other support services
to budding entrepreneurs. Any of these three avenues can lead to growth — or economic transformation — in a
locality or region.
Foundation #3: Competitiveness is at the root of economic development.
All three avenues for economic development face competitive challenges. The location of a new company or a
company expansion is fought over by many states (and sometimes areas within a state). Entrepreneurial growth
relies on venture capital support, which is usually tied to location-based incubators or funds. Additionally, a new
business can make frequent location moves as it grows, each time providing an opportunity for a competitor
region to capture the firm. Therefore, localities and regions need to focus on developing assets and policies that
will make them more competitive.
Foundation #4: Communities need people and funding to implement strategies, develop assets, support
businesses, and compete for companies.
The first three foundational ideas describe the work needed to achieve economic development. That work
requires people, without whom assets are not developed, and businesses are not matched to the resources they
need. Economic developers at local and regional levels help guide the community to reach its strategic goals
Southside-Southwest Virginia Barriers to Infrastructure and Supply Chain Investment | 2022 7
and work with various educational, state, and business partners to achieve those goals. The job of economic
developers requires many different skills: knowledge of site development and environmental permitting, the
ability to market the community to existing and prospective businesses, writing and managing grants, and
coordinating with stakeholders and community members. Even within a locality, the breadth of the work requires
multiple individuals to be in economic development roles to better specialize in these different functions. A
strong number of experienced local and regional economic developers enables regions to better coordinate
resources and achieve success.
Assets for Economic Development
When any company makes location decisions, three key assets are critical for a region to be considered:
1. A sizable workforce with industry-tailored skills
2. An available site for a new facility
3. Infrastructure to support the needs of products, executives, and workers
While the needs of a given company will vary based on its sector and size, companies are always trying to optimize
all three of these factors. A company will always face tradeoffs — maybe a location has the optimal workforce,
infrastructure, and incentives, but the site may need significant investment to be workable. Economic developers
strive to optimize each of these assets to make their community competitive for prospective companies.
Workforce
Companies need enough workers in an area to fill jobs and require workers to have adequate skills. Areas with a
workforce shortage or a talent mismatch can overcome this challenge by having the right infrastructure, such as
adequate childcare, housing availability, and healthcare supports to increase the current labor force and quality of
life factors to attract new talent. Workforce programs, community colleges, and universities can be leveraged to
upskill and maintain adequate talent levels for the region’s needs. Economic developers often guide the development
of these programs and connect companies and workers to these assets.
Sites and buildings
Project-ready sites and buildings are critical assets because they save companies money and time in site prep
work. Speed to market, especially for today’s larger industrial projects, is vital. While site development requires
significant local, regional, and state investment and staff time to execute, having a project-ready site is often the
determining factor for location decisions. Strategic site investments also allow localities and regions to control
where growth happens and what types of companies are brought to the region.
Infrastructure
Highway, rail, and airport access, to varying degrees, factor heavily in company location decisions. Proximity to
interstates or four-lane highways is important for export-oriented industries that need to move products. Some
specialized industries require rail to move their products instead and need on-site access to railroads. Corporate
executives may also prefer proximity to a commercial airport to minimize travel time to their numerous company
locations. Economic developers can work with various regional and state stakeholders to develop these
infrastructure assets long-term and ensure that sites selected for development are in an optimal location to
maximize access to critical infrastructure.
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While not a traditional “asset,” incentives are often leveraged as a competitive mechanism to ensure that
companies choose a location after finding adequate workforce options, sites, and infrastructure. Incentives can
compensate for cost challenges with essential assets and are often put towards workforce programming or site
development. Capital-intensive companies, such as companies in the automotive and semiconductor industries,
tend to prefer upfront incentives to help with the cost of plant construction. Incentives come into play near the
end of a company’s location search once the companies have found a few strong-contender sites.
Site Selection and Area Development are two publications that survey professionals who are influential in company
location decisions. In Site Selection’s 2022 Business Climate rankings, site selectors’ most important location
criterion was workforce skills, followed by state and local tax schemes and workforce development. Land/building
prices and supply tied for sixth, with utilities and incentives tied for eighth. Area Development’s Annual Consultant
Survey, which surveys site selection consultants, demonstrated similar priorities from site consultants as with Site
Selection, including an emphasis on workforce needs, infrastructure, site availability, permitting, and incentives.
However, Area Development’s ranking included key criteria not present in Site Selection’s, including proximity to
major markets, proximity to suppliers, and occupation or construction costs.
Table 3
Site Selection and Area Development location factor criteria
Site Selection Area Development
Location Factor Criteria Rank Location Factor Criteria Rank
Workforce skills 1 Availability of Skilled Labor 2
State and local tax scheme T2 Tax exemptions 10T
Workforce development T2 Training programs/ technical schools 15
Transportation infrastructure 4 Highway accessibility 3
Ease of permitting and regulatory procedures 5 Expedited or “fast-track” permitting 8
Land/building prices and supply T6 Available land 6T
Utilities (cost/reliability) T6 Energy availability and costs 7
Incentives T8 State and local incentives 4T
Higher education resources T8 - -
Quality of life T8 Quality of life 18
Source: Site Selection magazine4; Area Development5
Southside-Southwest Virginia Barriers to Infrastructure and Supply Chain Investment | 2022 9
Economic Context for
Barriers to Investment in
Southwest and Southside
10
Economic Context for Barriers to Investment in
Southwest and Southside
Historical Economic Challenges
The dominating feature of Southwestern Virginia is the Appalachian Mountains, rolling across the landscape for
200 miles east to west — from Patrick County to the Cumberland Gap in Lee County, the westernmost point of
Virginia. The mountains gave rise to the coal production industry and provided the climate for rich farmlands in
the valleys. They also gave the region its remoteness, unique aspects of cultural heritage, and natural beauty.
Manufacturing, including textiles and processes related to mining, produced a robust skilled workforce that
continues to serve the mining operations and advanced manufacturing sector present today. While representing
4.5% of the state’s working-age population, the region today produces 19% of the value of the state’s agricultural
products and 6% of the value of manufactured goods.6
Southside Virginia carries the heart of much of Virginia’s agriculture and manufacturing heritage. The region
spans 150 miles across the middle of Virginia’s border with North Carolina and is surrounded by the metropolitan
areas of Richmond, Lynchburg, and Roanoke. It is characterized by rich farmlands that once produced much of
the state’s tobacco crop and historical manufacturing cities such as Martinsville, Danville, South Boston, and
South Hill, which developed initially around the textile and furniture manufacturing industries. While also
representing about 4.5% of the state’s working-age population, the region today produces 11% of the value of
the state’s agricultural products and 6% of the value of manufactured goods.7
Figure 3
Virginia sector employment as a percentage of 1980 sector employment
Agriculture Furniture Manufacturing Mining Textile Manufacturing
100%
80%
60%
40%
20%
0%
1980 1990 2000 2010 2019
Source: Moody’s Analytics8; VEDP analysis
Note: The data examined did not break out Agriculture into its component commodities, like tobacco; the agriculture industry as a whole will
be used to represent the economic impact of the loss to the tobacco industry
Southside-Southwest Virginia Barriers to Infrastructure and Supply Chain Investment | 2022 11
Over the past 40 years, both regions saw repeated economic shocks to core industries — tobacco, furniture,
textiles, and coal. For different but coinciding reasons, each of these industries saw rapid declines statewide
after 1980 (Figure 3). Relaxed trade policies and aggressive competition from low-wage economies abroad led
to the closure and exodus of textile and furniture manufacturing companies. Health concerns and a push to
reduce smoking forced farmers to turn away from the profitable tobacco crop. Environmental concerns related
to the combustion of fossil fuels, associated federal policies, and increasing costs for extracting coal in the
region contributed to that industry’s decline.
The losses in these industries hit Southwest and Southside harder than the rest of Virginia because those
industries uniquely dominated the economy in those regions. In 1980, Southwest and Southside Virginia
collectively had 43% of the Commonwealth’s furniture manufacturing workforce, 58% of textile manufacturers,
82% of mine workers, and 39% of farmers (Figure 4). Those four sectors constituted 21% of the region’s total
employment (Figure 5).
Figure 4
Percentage of Virginia’s employment by locality grouping in 1980
Southwest Southside Other Rural/Mixed Rural Mixed Urban Urban
Agriculture 20% 19% 35% 17% 9%
Mining 81% 9% 6%
Furniture Manufacturing 21% 37% 8% 18% 16%
Textile Manufacturing 9% 35% 14% 28% 14%
Source: Moody’s Analytics9; VEDP analysis
Figure 5
Percent of the workforce employed in furniture/textile manufacturing, mining, and agriculture by locality
grouping versus total employment in 1980
20%
10%
0%
Southwest/ Other Rural/ Mixed Urban Urban
Southside Mixed Rural
Source: Moody’s Analytics10; VEDP analysis
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The total economic impact on Southwest and Southside was significant. In the four decades from 1980–2019,
over $2.3 billion in economic production and 50,000 jobs were lost (Figures 6 and 7). The second hardest hit
locality groups saw a GDP loss of less than $500 million (Mixed Urban, which had a moderate concentration of
furniture and textile firms) and an employment loss of roughly 22,000 (Other Mixed Rural and Mixed Urban).
Figure 6 Figure 7
Total employment loss in the four sectors (000s) Total GDP loss in the four sectors ($M)
Other Rural/Mixed Rural Mixed Urban Urban
10 500
5
0 0
-5
-10
-500
-15
-20
-1,000
-25
-30
-1,500
-35
-40 Southwest- Southwest-
-45 Southside -2,000 Southside
-50
-55 -2,500
1980 1990 2000 2010 2019 1980 1990 2000 2010 2019
Source: Moody’s Analytics11; VEDP analysis
Southside-Southwest Virginia Barriers to Infrastructure and Supply Chain Investment | 2022 13
The collective impact on all these industries caused employment loss in three out of four decades from
1980–2019, unmatched by any other region in the Commonwealth (Figure 8). Quantifying this loss is important
for understanding why the economy in Southwest and Southside has struggled to see a revival and what level
of private and public sector investment will be required to realize a sustained recovery. Due to the global
trends previously discussed, there is no expectation for furniture and textile manufacturing to return to the
U.S. or for tobacco farming and coal mining to return to their former production levels.
Figure 8
Average annual employment growth by region
Southwest-Southside Other Rural/Mixed Rural Mixed Urban Urban
6.0%
4.0%
2.0%
0.0%
-2.0%
1970–79 1980–89 1990–99 2000–09 2010–2019
Source: Moody’s Analytics12; VEDP analysis
The resources (primarily private sector investments and tax dollars) that would go into making a shift to
developing assets for future-growth industries in Southwest and Southside do not currently exist at the
levels naturally present in most metropolitan areas. This disadvantage is true for other rural areas in the
Commonwealth as well. Large and medium-sized metropolitan areas (counties directly outside independent
cities) have benefited in recent decades from structural advantages preferred by new-growth industries,
including concentrated populations, access to global infrastructure like ports and commercial airports,
and robust university systems. These structural assets have buoyed decades of growth in technical and
serviced-based industries, bringing financial strength to metropolitan areas that precipitated continued asset
improvements. Meanwhile, areas outside small and medium metropolitan areas, including Southwest and
Southside, have repeatedly been categorized as distressed or double distressed — facing higher rates of
poverty and unemployment (Figure 9).
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Figure 9
Localities by VEDP distress level, with rural distress mostly concentrated in areas outside
of large and medium metros
Double Distressed (unemployment AND
poverty rate above the statewide average)
Single Distressed (unemployment OR
poverty rate above the statewide avg.)
Not Distressed
Source: VEDP13
In recent years, the trend has started to shift with rising employment, positive net migration, and significant
company investments coming to Southwest and Southside (discussed further in the next section). Much of this
positive momentum is the result of dedicated investments in workforce assets, industrial sites, and infrastructure
made by communities, regional organizations, and state entities over the last two decades. However, infrastructure
and supply chain investments in these regions still lag behind the rest of the state. Sustaining the positive
momentum seen in recent years will require focus and additional investment from the state, regions, and
localities into key assets that will propel Southwest and Southside toward future economic success.
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Recent Trends Signaling Future Opportunity
There have been several positive trends in Southwest and Southside as Virginia has recovered from the pandemic.
First, migration patterns following the first year of the pandemic show a movement of people out of major
metropolitan areas, especially Northern Virginia, to more rural parts of the state (Figure 11). Southwest saw a net
positive migration of 521 people, and Southside saw a net positive migration of 1,711 people. While this did not
make up for the natural loss from an aging population (Figure 10), this is an early sign that recent project wins and
the flexibility allowed by remote work are helping to reverse previous outmigration trends.
Figure 10 Figure 11
Natural population change (births minus deaths), 2020–2021 Net migration, 2020–2021
Population Increase Population Decrease
Source: U.S. Census14
Employment recovery from the pandemic has been stronger in Southwest and Southside Virginia than in other
areas of the state (as has been the case with other rural areas). Both regions have higher employment levels than
before the pandemic (Figure 12). This positive trend has also brought challenges. The region is now experiencing
workforce shortages for employers, as well as housing, childcare, and healthcare shortages for workers. These will
be discussed in a later section of the report.
Southside-Southwest Virginia Barriers to Infrastructure and Supply Chain Investment | 2022 16
Figure 12
Employment change from February 2020–September 2022, by VEDP Marketing Region (% of absolute
employment change, not seasonally adjusted)
-4.8% 6.4%
Statewide change: -3.1%
Source: Bureau of Labor Statistics, Local Area Unemployment Statistics15
Recent statistics showing economic growth demonstrate the success of the steps the region has taken to
cultivate its industry targets. The GO Virginia Regions and regional economic development organizations
(REDOs) in Southwest and Southside have conducted target industry studies to develop specialized regional
priorities for workforce, site, and infrastructure investments. The primary focus of all regions has been to grow
the Advanced Manufacturing/Materials and Information Technology/Professional Services sectors — an effort
that has resulted in several notable recent wins. Other traded sector targets, such as Admin and Support Services,
Distribution and Logistics, Food & Beverage Manufacturing, Wood Products, and Energy/Minerals, are also
targets for certain subregions in Southwest and Southside16. Through 2025, the broader region is projected to
see annual growth in nearly all of its industry target sectors (Figure 13).
Figure13
Projected average annual change in employment for target sectors in Southwest and Southside Virginia,
2021–2025
0.8%
0.3%
-0.2%
Advanced Professional Admin and Distribution / Food and Wood products
Manufacturing services and support services Logistics beverage
information manufacturing
Source: Moody’s Analytics17; VEDP analysis
Southside-Southwest Virginia Barriers to Infrastructure and Supply Chain Investment | 2022 17
This growth is a direct result of recent transformational project wins. In 2019, Morgan Olson, a step van
manufacturer, announced the establishment of a state-of-the-art factory bringing 700 jobs to Pittsylvania
County in Southside. Additional new investments from advanced material manufacturing firms Staunton River
Plastics and SCHOCK GmbH (200 jobs in Pittsylvania County and 350+ jobs in Henry County, respectively),
and expansions by Tyson Foods (370+ jobs in Pittsylvania County) and Hitachi Energy (160+ jobs in Halifax
County) have laid the groundwork for a resurgence in manufacturing. The addition of IperionX’s titanium
demonstration facility in Halifax County and FyberX’s HQ in Mecklenburg County is proving Southside’s value
as a place to develop new technologies.18
In Southwest Virginia, the announcement of Blue Star Manufacturing’s nitrile glove facility in Wythe County
in 2021 is the largest single investment made in both regions since before 1990, with an expected 2,400 jobs
once fully operational. The region has also seen several wins in technology and services-oriented industries,
such as the expansion of 1901 Group (150 jobs in Washington County), the new location of eHealth Technologies
(160 jobs in Scott County), and EarthLink’s customer services support center (285 jobs in Norton). Recent
manufacturing wins such as Maine Five in Buchanan County (100 jobs), and Ceccato S.p.A. in Russell County
(50 jobs) demonstrate the region’s continued strength in manufacturing.19
These wins are the result of long-term collaborative investments in site development, workforce, and infrastructure.
For example, the multi-year, over $9 million investment in Project Intersection, a collaboration between Dickenson,
Lee, Scott, and Wise Counties and the city of Norton through a Regional Industrial Facilities Authority (RIFA),
led to EarthLink’s win.20 Wythe County’s development of the 160+ acre Progress Park site took several de-
cades before ultimately landing BlueStar’s transformational project.21 Investment in workforce and technology
assets, such as GO-TEC and the Institute of Advanced Learning and Research, spurred recent manufacturing
wins in Southside. Financial resources from the Tobacco Region Revitalization Commission (TRRC), the
Virginia Coalfield Economic Development Authority (VCEDA), GO Virginia, and other state and regional entities
have all supported these and many other transformational projects.22
The investments above have been driven by the creative and resilient people in these regions, demonstrating
the success that can come from focused and dedicated effort. Even so, Southwest and Southside are still
projected to lag behind the rest of the state in employment growth this decade. Structural barriers still at work
in the regions will limit the development of future-oriented target industries unless adequate investment in
assets is made to overcome those barriers.
Southside-Southwest Virginia Barriers to Infrastructure and Supply Chain Investment | 2022 18
Selected Announcements
WytheCounty Pittsylvania County Pittsylvania County
2,464 jobs | $715.3M 703 jobs | $57.8M 376 jobs | $295.5M
Since 2019, GOVA Regions 1
and 3 have announced:
HenryCounty City of Norton Washington County
$2.7B
355 jobs | $85M 285 jobs | $5.4M 250 jobs | $30M
CAPITAL INVESTMENT
TazewellCounty City of Bristol Pittsylvania County
218 jobs | $198.4M 200 jobs 200 jobs | $34M
9,986
NEW JOBS
Buchanan County HalifaxCounty ScottCounty
181 jobs | $169.1M 165 jobs | $37M 160 jobs | $0.4M
102
COMPANIES ANNOUNCED
INVESTMENT City of Danville Pittsylvania County Washington County
160 jobs | $46.2M 150 jobs | $3.5M 150 jobs | $1.2M
Henry County Wythe County CarrollCounty
126 jobs | $145M 120 jobs | $39M 118 jobs | $2.3M
Washington County Halifax County Buchanan County
113 jobs | $8.0M 108 jobs | $82.1M 100 jobs | $0.4M
Assessment of Barriers
and Recommendations
to Achieve Additional
Infrastructure and Supply
Chain Investment
20
Assessment of Barriers and Recommendations
to Achieve Additional Infrastructure and
Supply Chain Investment
Virginia’s Rural Funding Landscape
This report will examine Virginia’s rural funding and programs in the context of four peer states: Tennessee, North
Carolina, Georgia, and South Carolina. Other peer states will occasionally be mentioned to highlight differences or
model programs.
An analysis of the four main peer states’ economic development organizations shows that Virginia’s competitors
have placed a higher priority on funding key rural programs. Virginia does have notable organizations, such as
TRRC and VCEDA, which have historically provided significant funding for economic development efforts across
Southwest and Southside Virginia. These programs have provided targeted funding for infrastructure, sites,
workforce, and other assets over the last two decades that have generated economic growth – especially in
recent years. TRRC has made substantial and consistent investments across the Southwest and Southside region,
totaling $1.47 billion in grants and loans between 1999 and 2021. However, on a per capita basis, Virginia is
outspent by South Carolina and North Carolina on key aspects of rural development. It is competitive with
Tennessee and Georgia in terms of per capita spending. Still, Virginia does not have designated state agency
infrastructure and carve-outs for rural funding that can be found in those states, which ensure consistent
funding for rural communities over time.
As shown in Figure 14, South Carolina and North Carolina spend the most in terms of per capita investment in
programs that directly benefit rural areas, such as programs for site development, infrastructure improvements,
and local capacity building. For capacity building programs specifically, Georgia and Tennessee spend three times
as much per capita as Virginia, and North Carolina spends eight times as much as Virginia per capita – led by their
$5 million Rural Transformation Grant program. Despite this, Virginia has made notable investments in some of
these areas and will substantially increase its statewide investment in site development in FY23.
Southside-Southwest Virginia Barriers to Infrastructure and Supply Chain Investment | 2022 21
Figure 14
Approximate annual per capita state investment in rural economic development programs (Rural and Mixed-Rural
populations), most recent fiscal year estimates
$40.00 Site Development
Buildings
$30.00 Infrastructure/Utilities
Downtown Revitalization
$20.00 Capacity Building
$10.00
$-
South Carolina North Carolina Georgia Virginia Tennessee
Source: Various annual reports, state budget documents, and grant reporting systems from state agencies in Georgia, North Carolina,
South Carolina, Tennessee, and Virginia23
Note: This is an estimate of what each state allocates to these key program areas on an annual basis using publicly accessible data from
the most recent fiscal year. There is significant variation in budget and grant reporting practices across states. Georgia and Tennessee do not
provide as much detailed reporting on economic development grants as other states; total grant funding may be higher than shown above.
Virginia’s peer states have addressed rural economic development challenges through a combination of targeted
rural grant programs and staff resources funded and designated specifically for rural issues. To varying degrees,
neighboring states have also reduced silos and consolidated some rural development programs under economic
development agencies. This is facilitated by public-facing efforts by Governors and other decision-makers to make
rural issues a policy priority.
In Georgia, Governor Kemp created a Rural Strike Team within the state’s Department of Economic Development
tasked with securing and managing major new projects in rural areas. A recent ranking by Site Selection magazine
placed seven rural Georgia counties in its list of top-50 high performing non-metro counties, with two in the top five.
The ranking credited the strike force with establishing a culture of collaboration between the state’s economic
development organization and its partners in rural counties.24
North Carolina’s Rural Economic Development Division (REDD) is housed within the state’s Department of Commerce
and offers grants and capacity-building programs that support economic competitiveness in rural communities. In
FY 2022, it’s staff of 12 distributed approximately $55 million in grant funding for site development, infrastructure,
and capacity building.25 A significant portion of this funding, approximately $25 million, came from a one-time
infusion of federal American Rescue Plan funds. In addition to grants, REDD began a $3.5 million training and
technical assistance pilot program for local government staff in 2021, which aids with local strategic planning and
project development.26 REDD’s grant investments were supplemented by approximately $15 million in additional
funding for rural site and infrastructure development from the Golden Leaf Foundation, a grantmaking entity funded
with tobacco settlement funds and is separate from the state’s Department of Commerce. North Carolina’s Rural
Center is another major support organization in the state. It operates as a nonprofit with a budget of approximately
$5 million and a staff of 30.27 This year, the North Carolina legislature allocated $202 million in federal funding to the
Rural Center to support small businesses.28
Southside-Southwest Virginia Barriers to Infrastructure and Supply Chain Investment | 2022 22
South Carolina established the Rural Infrastructure Authority (RIA) to support investments that enhance economic
growth in the state’s most distressed counties. Last year, it distributed $30 million in grants supporting 64 projects.
Since its founding in 2013, it has awarded over $205 million across the state, which generated an estimated 11,500
new jobs.29
Tennessee established a Rural Task Force in 2016, which led to the development and implementation of a statewide
rural strategy.30 This strategy has resulted in focused investments in the ThreeStar local capacity building program,
dedicated annual funding for site development in rural communities, and a rural development division with a staff of
10 within the state’s Department of Economic and Community Development.31
Each of these states has bolstered rural initiatives in other ways, for example, by leveraging tobacco settlement funds
— similar to Virginia — for rural economic development (Georgia and North Carolina), by integrating rural community
carve-outs into existing economic development incentive programs (Tennessee), and by offering resources and
services directly to rural communities through dedicated internet platforms (all four states). The websites of each
state economic development organization have a unique landing page for all their rural programs and resources.32
In contrast with other states, the Center for Rural Virginia, a nonprofit organization created by the General Assembly
at the recommendation of a 2001 report by the Rural Virginia Prosperity Commission, is Virginia’s only organization
dedicated solely to rural economic development across the Commonwealth.33 The Center plays an important role in
advocating for rural Virginia and supporting the leadership development for rural communities but currently lacks
the elevated mandate and funding that established rural agencies have in other states.
Use of Tobacco Settlement Funds in Virginia and North Carolina
Tobacco settlement funds play an important role in the rural economic development landscape in both Virginia
and North Carolina. In Virginia, for example, TRRC has distributed over $1.4 billion in grants and loans to Virginia’s
Tobacco Region since its inception. How those funds have been administered over time provides useful insight
into why Virginia may need to increase its investments to remain competitive (Table 4). Virginia’s TRRC has less
funding to distribute each year in large part because of the way the Commonwealth chose to draw down its
share of tobacco settlement funding in the years immediately following the settlement. TRRC’s only funding
source is its endowment, and the organization is shifting toward offering more loans rather than grants to
sustain its assets over the long term.
North Carolina’s tobacco settlement funds are distributed to the Golden Leaf Foundation in smaller annual
increments, which will continue in perpetuity. The North Carolina General Assembly has also made ad hoc
supplemental appropriations during some years, typically for specific one-time programs. Golden Leaf is a
501(c)3 nonprofit foundation, which gives it the ability to access other sources of funding through private
donations, though it does not appear to have done so in recent years. The upshot is that while TRRC has had
a very substantial economic development impact over the past two decades, its long-term ability to compete
is constrained due to its financial structure.
Southside-Southwest Virginia Barriers to Infrastructure and Supply Chain Investment | 2022 23
Table 4
Comparison between North Carolina’s Golden Leaf Foundation and Virginia’s Tobacco Region
Revitalization Commission
Program Detail North Carolina Virginia
Entity name Golden Leaf Foundation Virginia Tobacco Region Revitalization
Commission
Funding sources Annual tobacco settlement fund Endowment income from lump sum
allocation; ad hoc state tobacco fund allocation in 2005
appropriations; endowment income;
private foundation funds (potentially)
Grants awarded (FY22) $126.8M $18.3M
Assets (FY22) $1.2B $363.7M
Source: Golden Leaf Foundation Annual Report35; Virginia Tobacco Region Revitalization Commission Annual Report36
Context for Recommendations to Follow
The recommendations in the following sections describe a variety of policies to address key challenges facing
communities in Southside and Southwest Virginia. Many of the states mentioned above already have programs
to address these challenges, and those programs will be described in greater detail for decision-makers to
consider when developing policies for Virginia.
Southside-Southwest Virginia Barriers to Infrastructure and Supply Chain Investment | 2022 24
Capacity in Economic Development
Capacity in Economic Development – Barriers
Economic development capacity should be a top priority of localities, regions, and the state because without
dedicated economic development staff, localities and regions are heavily disadvantaged when it comes to their
ability to increase infrastructure and supply chain investment. Project wins heavily depend on economic
developers’ ability to cultivate community assets (through grants, stakeholder engagement, and other avenues),
market those assets to prospective or expanding companies, and work with companies as they work through
their location decision-making process. For communities without an economic developer, the Chief Administrative
Officer of a locality often takes on this role. Adding economic development work to the requirements of running
a locality, even with an experienced administrator, means that essential elements of economic development in
the community will be sacrificed.
Following a statewide assessment of local and regional economic development organizations in January 2020,
VEDP determined that over three-quarters of rural localities had fewer than two economic developers — almost
half had no dedicated economic developer at all. Mixed Rural localities were doing slightly better, with just over
half employing two or more dedicated economic developers. In Southwest and Southside, a mostly rural part of
the state, only one-third of localities were sufficiently staffed with two or more dedicated economic developers,
and a third had no dedicated economic developer. Most Mixed Urban and Urban localities (85%) had at least two
dedicated economic developers, and only two did not have an economic developer.
This assessment highlighted how critical economic developers are to realizing supply chain investment in an
area. A locality with two or more dedicated economic developers is twice as likely to secure a project, demonstrating
the difference made by having dedicated staff resources for economic development (Figures 15 and 16).
Figure 15 Figure 16
Annual likelihood of a locality winning a project Percent of localities that won a project compared to
compared to the number of dedicated economic the total number of dedicated economic developers,
developers, based on 2019–2022 project data based on 2021–2022 project data
80% 80%
70% 70%
60% 60%
50% 50%
40% 40%
30% 30%
20% 20%
10% 10%
0% 0%
0 1 2 3+ Mixed Urban, 0 1 2 3+ Mixed Urban,
Urban, all Urban, all
Rural/Mixed Rural Rural/Mixed Rural
all all
counties and cities counties and cities
Source: VEDP’s 2020 Local and Regional Competitiveness Assessment37; Virginia local economic development websites; VEDP
Announcements & Closings Database38; VEDP analysis
Note: Includes new and expansion projects
Southside-Southwest Virginia Barriers to Infrastructure and Supply Chain Investment | 2022 25
Capacity challenges in economic development are demonstrated in other ways. In addition to working on project
attraction and expansion, economic developers either write grants to improve community assets or help
coordinate stakeholders to apply for grant funding. Compared to neighboring states in the Southeast, Virginia
has received the lowest amount of federal grant funding per capita for rural areas (Figure 17). Additional eco-
nomic development staff capacity would enable more communities and regions to develop strong applications
to secure these grants.
Figure 17
Federal rural development funds per capita (Rural and Mixed-Rural populations), FY17–FY22
ARC USDA ED HHS DOT FCC Other
$400
$300
$200
$100
$-
Tennessee South Carolina Georgia North Carolina Virginia
Source: Brookings Institution39; U.S. Department of the Treasury40; VEDP analysis
Note: Agency abbreviations are as follows: Appalachian Regional Commission (ARC); U.S. Department of Agriculture (USDA); U.S. Economic
Development Administration (EDA); U.S. Department of Health and Human Services (HHS); U.S. Department of Transportation (DOT);
Federal Communications Commission (FCC); Other (assorted low-dollar programs from the Department of Interior, Department of Justice,
and Department of Labor).
In addition to staff, providing planning and resource development support would greatly expand the capabilities
of economic developers to support asset development, work with stakeholders, and support project investment.
Economic developers in Southwest and Southside have made strides with limited resources. Still, financially
supporting strategic plans, target industry studies, marketing material development, and site and infrastructure
studies would enable under-resourced localities to move economic development efforts forward.
The presence of strong regional economic development organizations is also critical to unlocking additional
infrastructure and supply chain investment. Regional organizations often streamline marketing and business
attraction resources and facilitate collaboration across localities. The organizations can also fill gaps in local
economic development capacity. Their ability to serve as a facilitator and collaborators is important for the
success of Southwest and Southside and should be considered in developing recommendations for capacity
support programs.
Southside-Southwest Virginia Barriers to Infrastructure and Supply Chain Investment | 2022 26
Capacity in Economic Development – Recommendations and Models for Success
Recommendation A: Develop a new program that funds staff, training, and technical resources to increase local
and regional economic development capacity in Virginia. The program should:
■
Provide matching funds for local and regional organizations to hire economic development staff
■
Provide matching funds for localities and regional economic development organizations with staff to conduct
strategic plans and target industry studies, develop marketing plans and resources, and seek expert
resources for new site identification analyses and infrastructure planning
Several neighboring states have already placed a high priority on capacity building for economic development
(Table 5). North Carolina’s Rural Community Capacity Grant, launched in 2022 as a part of its new Rural
Transformation Grant program and funded at approximately $3.5 million, provides educational programming,
technical assistance, and focused guidance to local government staff in rural and distressed communities.41 In
2019, Tennessee started the ThreeStar Program to incentivize localities to assist communities in asset-based
planning, funded at $2.5 million. Tennessee’s Department of Economic and Community Development also has a
separate program to assist localities in developing marketing assets.42 The NC Rural Center, a nonprofit
state partner focused on rural development, also supports capacity building efforts. The organization runs the
Rural Economic Development Institute, which has trained 1,300 leaders since it began in 1987.43
Currently, Virginia’s only funded capacity development effort is the Virginia Rural Leadership Institute (VRLI),
conducted through the Center for Rural Virginia. The VRLI completed its inaugural year this November with a
cohort of 29 members who received training on economic and community development topics and were paired
with a mentor to support the development of a community-impact project. The force of this program is already
being felt in communities like Pulaski, where an impact project is leading to the renovation of several buildings
downtown with plans for further enhancements.44
Based on current capacity challenges in economic development, primarily throughout rural Virginia, best practices
identified in programs in North Carolina and Tennessee may serve as a model for funding to increase local and
regional economic development capacity.
Table 5
Capacity building programs in Virginia and competitor states
Annual
Program State Agency Program Description Expenditure
Virginia Rural VA Center for Supports leadership development for rural ~$0.1M
Leadership Institute Rural Virginia Virginia leaders and professionals
Rural Community NC REDD Supports professional development and $5M
Capacity (Rural education for building local capacity, provides
Transformation Grant) technical assistance to localities
Rural Economic NC NC Rural Center Trains rural leaders on collaborative Unknown
Development Institute leadership skills and rural development
strategies
ThreeStar Program; TN TNECD Supports strategic planning, staffing, and $2.5M
Marketing Assistance resource development for localities; separate
Program marketing program leverages state ECD
resources to develop marketing materials for
localities
Source: Center for Rural Virginia45; North Carolina’s Rural Economic Development Division46; Tennessee Economic & Community Development47
Workforce
Workforce Supply and Development – Barriers
Over the past year, businesses nationwide have been dealing with a workforce shortage. VEDP’s Regional Talent
Solutions and Business Outreach team and local economic developers have confirmed this challenge with the
businesses they interface within Southwest and Southside. Businesses have been trying various methods to
attract workers, including providing more flexible hours and increasing pay. While much of the current labor
stems from the economic rebound from COVID-19, the shortage is being felt more acutely in Southwest and
Southside Virginia because of previous population declines and a current labor force participation rate that
significantly lags behind other parts of the state. The labor force participation gap has widened over the decades
and impacts workers of all ages, genders, and education levels (Figure 18).
Figure 18
2020 Labor force participation rates, Southwest-Southside and VA total comparison
Southwest-Southside State Total
100%
80%
60%
40%
20%
0%
Total Ages Ages Ages Ages Male Female Less HS Some Bachelor
16–24 25–54 55–64 65+ than HS Degree College/ Degree+
Degree Associates
Source: U.S. Census48
Several structural issues are contributing to the workforce shortage and the lower labor force participation rate
in Southwest and Southside. Skill mismatches between the current workforce and the needs of new employers
and technologies are one factor driving this gap. Other structural issues are more of a challenge in these regions
compared to other areas of the state, including shortages in housing, childcare, and healthcare. Vibrant main
streets, cultural and natural resources, broadband, and other amenities critical for attracting and retaining talent
in rural areas are also more limited across the region. These issues will be discussed separately from this
section’s focus on traditional workforce upskilling and reskilling barriers.49
The workforce development system in Southwest and Southside faces both short-term and long-term challenges.
In the short term, businesses are constrained by their ability to hire new workers and upskill existing employees
to leverage rapidly changing technology.50 Many state programs and local educational institutions address
some aspect of this need, but there are several limitations with current state programs. VEDP’s workforce
Southside-Southwest Virginia Barriers to Infrastructure and Supply Chain Investment | 2022 28
training offerings, the Talent Accelerator Program or the Virginia Jobs Investment Program (VJIP), help fill this
gap for new and expanding companies but are not designed to support existing businesses facing immediate
labor challenges.51
Tuition assistance programs, like G3 and FastForward, are targeted at students and workers and enable company
employees to take available training.52 FastForward, which funds up to two-thirds of the cost of training upon
completion, is in its seventh year and boasts a 93% completion rate. Additionally, 24,000+ graduates (about 72%
of program participants) have chosen to remain and work in Virginia following their FastForward program.53
While these programs are building out the talent pipeline, they do not directly support potential custom training
needs companies may require involving new equipment or skills. Additionally, these programs are limited in their
ability to cover non-education costs that create barriers for students, such as childcare, transportation to the
institution, or housing for students attending classes full-time. G3, for example, provides a Student Support
Incentive Grant (SSIG) to cover these costs, but only for students enrolled full-time.54 Working adults or people
needing limited credentials do not receive this additional support. Institutions also provide advising and career
coaching to help people access additional resources. Still, fewer staff in these roles at Southwest and Southside
institutions serve an outsized number of part-time students.
Southwest and Southside Virginia’s workforce supply challenge is not the same for localities in competitor
states just over the border. Companies locating across the Virginia state line benefit from closer proximity to the
metropolitan areas and postsecondary institutions of Raleigh-Durham, Greensboro-Winston-Salem, the Tri-Cities
(Johnson City, Kingsport, Bristol), and Knoxville (Figures 19 and 20). To compete with rural border localities in
Tennessee and North Carolina, Southwest and Southside will need to continue to invest in growing the supply
of skilled workers for companies that will increasingly prioritize talent when making location decisions.
Figure 19
Manufacturing jobs by locality (2022)
Source: Lightcast55
Southside-Southwest Virginia Barriers to Infrastructure and Supply Chain Investment | 2022 29
Figure 20
Professional, Scientific, and Technical Service jobs by locality (2022)
Source: Lightcast56
Long-term, the region will need to increase the number of degree and non-degree holders with skills in computer
science, engineering, and skilled trades. As industries incorporate more automation and data-driven processes
into their facilities, a greater proportion of manufacturing employees will be these skilled workers. Tech and
professional service sectors also have a higher demand for people with computer science and data analysis
skills and prioritize talent above all other location factors.57
Nearly all of Virginia’s community colleges and higher learning institutions provide customized training for
existing businesses and hold those trainings either at the institution or on-site at the company. However, there
are limited funding mechanisms to support start-up costs for new programs to provide these resources. These
programs need, at minimum, additional staff to provide training and can require developing new resources or
purchasing equipment. The state has funded $8 million in G3 Innovation Grants in FY23 to scale up programming
to meet demand. However, those funds are one-time allocations and will not continue to support institutions as
workforce demand and training equipment change in future years. The state also established the Advanced
Manufacturing Talent Investment Program and Fund with $2.5 million in resources starting in FY24. If funded
and expanded adequately long-term, this program will greatly increase postsecondary institutions’ capacity for
training workers in several priority sectors.58
Southside-Southwest Virginia Barriers to Infrastructure and Supply Chain Investment | 2022 30
Southwest and Southside may draw talent from flagship institutions outside of these regions. However,
community colleges and public/private four-year universities within Southwest and Southside provide the
most reliable supply of skilled labor that could supply future industrial growth. The region saw just under 500
awards (degrees and credentials) from tech and computer science-oriented programs (Figure 21) and about
900 awards for manufacturing-oriented programs in 2022 (Figure 22).
Figure 21 Figure 22
Computer Science, Math, and IT-Engineering Math, Engineering, and Technical awards from all in-region
awards from all in-region awards post-secondary post-secondary institutions, by GO Virginia region (FY22)
institutions, by GO Virginia region (2022)
Engineering Program Awards
Non-Engineering Manufacturing Program Awards
3,000
4,000
2,500
2,000 3000
1,500
2,000
1,000
1,000
500
0 0
1 2 3 4 5 6 7 8 9 1 2 3 4 5 6 7 8 9
Source: SCHEV59; VEDP analysis
Growing the number of students accessing degree and credential programs at institutions in Southwest and
Southside will require additional operational funding and additional student demand for the programs. New
instructional staff will be a chief priority for higher education institutions as they expand programing now and in
the future. Many of these instructors will need to be attracted from outside the region, or additional investments
will need to be made to develop instructors of programs. The region will also need to generate additional
student interest in pursuing degrees and credentials in these critical workforce programs. Additional state,
regional, and local focus on engaging students in the K-12 system and providing internship and apprenticeship
opportunities will be critical to generating this demand long term.
Southside-Southwest Virginia Barriers to Infrastructure and Supply Chain Investment | 2022 31
Workforce Supply and Development – Recommendations and Models for Success
Recommendation B: Expand GO TEC and continue to fund programs like the Virginia Talent Opportunity
Partnership (VTOP), Innovative Internship Fund and Program, and dual enrollment pathways that expose
students to manufacturing and other high-demand industries
A. Funding an expansion of GO TEC that would allow the program to spread into K-12 schools across other
areas of the state and increase the number of schools served in Southwest and Southside Virginia
B. Continue to support and expand programs such as:
■
VTOP
■
Innovative Internship Fund and Program
■
Department of Education K-12 CTE programs
■
Dual enrollment pathways at postsecondary institutions
To address the challenge of long-term interest and workforce supply for high-demand positions in the
manufacturing and technology fields, the GO TEC program has pioneered a unique model that has already seen
incredible success in Southside. Working with middle and high school students, the program uses a hub and
spoke model to progressively introduce students to resources and programming within targeted, in-demand
career pathways. The program forges partnerships between K-12 schools, higher education institutions, and
industry partners. It is currently funded through GO Virginia grants, but the success of the program merits
strong consideration for permanent funding to further develop and expand the use of this program to other
areas in the state.60
Other programs are also critical for promoting and developing student interest in high-demand fields. VTOP
and the Innovative Internship Fund and Program encourage and enable students to pursue internships with
employers. K-12 career and technical education (CTE) programs and dual enrollment pathways expose students
to career opportunities earlier, which is critical for developing talent pipelines to industries and providing
students with direct skills to advance their careers. Continuing to fund these programs, and expand them when
demand exists, are important for developing a quality workforce in Southwest, Southside, and the rest
of Virginia.61
Recommendation C: Expand eligibility for G3’s Student Support Incentive Grant (SSIG) to part-time and non-Pell
Grant students, providing more support to working students with non-tuition costs, like transportation, childcare,
and other needs
G3 provides tuition assistance for qualifying students looking to pursue degrees or credentials in high-demand
fields. At least 20 other states have some sort of state-funded aid program for postsecondary education, as
do many cities and regions. Like G3, most programs around the country cover remaining tuition and fees after
receiving all other forms of aid (usually federal). Some state programs, however, expand the flexibility of aid
so that students can apply funds to other expenses like rent, food, or childcare. Oregon, for example, provides
tuition coverage and a minimum of $1,000 of support to all students, regardless of whether they have other
grant aid for tuition that can cover other expenses. Virginia’s G3 program includes a Student Support Incentive
Grant (SSIG), where full-time students receiving Pell Grants can receive middle-dollar coverage. However,
students pursuing credentials or degrees while working are considered part-time and do not qualify for this
additional aid. Many of these students face challenges in completing credential or degree programs, such as
paying for childcare or covering the cost of gas. Modifying the eligibility requirements for G3’s SSIG will reduce
barriers and enable more people to use the programs, therefore increasing the workforce quality in Virginia.
Southside-Southwest Virginia Barriers to Infrastructure and Supply Chain Investment | 2022 32
Recommendation D: Expand advising and career coaching capacity at institutions with higher rates of part-time
students using credentialing programs supported by G3 and Fast Forward
Advisors and career coaches at postsecondary institutions can support students by connecting them with jobs or
unlocking additional financial support services. This staff role forms an important bridge between private sector
opportunities and program offerings. As G3 and FastForward expand the number of students seeking credentials
or attending part-time degree programs, additional support staff will be necessary to work with students as they
navigate programs and career opportunities.
Recommendation E: Provide permanent and flexible capacity building funding for post-secondary institutions to
develop and/or expand responsive training programs for private sector businesses. This program should:
■
Provide permanent and accessible startup funding, either through grants or other mechanisms that help
educational institutions develop training programs for local employers
■
Enable educational institutions to use that startup funding to invest in resources such as equipment,
materials, instructors, transportation, and other expenses to improve worker and employer access to
the program
For employee training, community colleges and other higher education institutions provide customized training
opportunities for employers either at the institution or on-site. Programs like Mountain Empire Community
College’s Center for Workforce and Innovation in Wise County or the Southern Virginia Higher Education Center in
Halifax develop training curricula for high-demand regional skills, provide state-of-the-art equipment for employees
and students to train with, and work with companies to build out additional programming when needed.62
Institutions often lean on grant funding to develop these programs. Southside Virginia Community College (SVCC),
for example, has utilized grant funding from TRRC to develop and expand its healthcare programming to respond
to the increased regional need for skilled nurses and other professions. These funds allowed SVCC to purchase
new state-of-the-art equipment and establish a weekend option for students enrolled in its nursing degree
program.63
Virginia’s workforce-oriented programs have incredible success rates. For example, the Power Line Worker Training
program, offered by Southside, Wytheville, and Mountain Empire Community Colleges, has nearly a 100%
employment rate among completers.64 As the Commonwealth becomes more sophisticated at aligning higher
education programming with future employer needs, providing a permanent funding source that allows institutions
to continue to develop, expand, and improve workforce programs will be critical to ensure this alignment is
successful.
Southside-Southwest Virginia Barriers to Infrastructure and Supply Chain Investment | 2022 33
Housing
Housing - Barriers
Housing is a critical factor for attracting and retaining talent. When companies make location decisions, one of the
questions they rightfully ask is, “Where will my employees live?” With the current national housing shortage, having
current or planned housing stock can give communities a competitive edge, while a lack of housing options may
steer projects away.
The national housing shortage is also impacting Southwest and Southside, but due to lower profit margins in the
region for developers, there has not been the same level of private sector investment that has occurred in other
areas (Figure 23). Across single-unit and multi-unit dwellings, construction is significantly lower than in other rural
areas, where the rate of people moving into units is roughly the same (Figure 24). Southwest and Southside saw
only 5,538 new units authorized in the last five years, while the rest of Rural-Mixed Rural Virginia saw 29,529
authorizations. As a result, the housing stock in the region is older and lacks various modern housing types desired
by families and younger workers. According to stakeholders across the economic development community in
Southwest and Southside, the housing strain has increased since the pandemic, with the region seeing a net
migration of nearly 1,900 people between 2020 and 2021. Recent project wins, such as Blue Star (which will add
2,400 workers to the Mount Rogers region), SCHOCK GmbH, and Tyson Foods (adding a combined 700+ workers to
Southside), will exacerbate current shortages.
Figure 23
New units authorized (2016–2021) as a percentage of existing 2015 units
Southwest-Southside Other Rural/Mixed Rural Mixed Urban Urban
6%
5%
4%
3%
2%
1%
0%
1 Unit Dwelling 2–3 Unit Dwelling 5+ Unit Dwelling
Source: U.S. Census65; VEDP analysis
Southside-Southwest Virginia Barriers to Infrastructure and Supply Chain Investment | 2022 34
Figure 24
Percent of units based on when new homeowners/tenants moved in, excluding move-in data prior to 2010
Southwest-Southside Other Rural/Mixed Rural Mixed Urban Urban
35.0%
30.0%
25.0%
20.0%
15.0%
10.0%
0.5%
0%
Moved in 2019 or later Moved in 2015 to 2018 Moved in 2010 to 2014
Source: U.S. Census66; VEDP analysis
With a national housing shortage underway and construction costs higher (costs have increased by 8% since the
end of 2019, according to the U.S. Census Construction Price Index), the market for housing construction will
continue to disadvantage Southwest and Southside Virginia.67 Data from the National Association of Realtors
highlights the disparity of home values between the region and other parts of the state (Table 6). Cost-conscious
and risk-averse developers have a greater incentive to build in other rural and metropolitan areas of the state and
will continue to do so without reductions in development costs or increases in housing values in rural areas.
Table 6
Average locality median home price comparison across groupings, Q2 2022
Average County Median Home Value as a Percent of Southwest-Southside’s
Grouping Price, 2022 Median Home Value
Southwest-Southside $145,416 100%
Other Rural-Mixed Rural $272,077 187%
Mixed Urban $263,659 181%
Urban $432,052 297%
Source: U.S. Census68
Southside-Southwest Virginia Barriers to Infrastructure and Supply Chain Investment | 2022 35
Virginia Housing, the Commonwealth’s housing finance agency, operates several grant programs aimed at
addressing these challenges (Table 7). Most of these grants are funded through a portion of the agency’s
revenue through loan servicing. In addition to these grant programs, Virginia Housing administers the Low-Income
Housing Tax Credit (LIHTC), a significant driver of affordable rental housing production and preservation.
However, these programs do not directly address the barriers preventing market-rate developers from building in
Southwest and Southside.
Table 7
Virginia Housing grant programs
Program Description Grant Amount
Planning grants Support for pre-development studies, assessments, Up to $50,000
community engagement efforts, and related activities
Development grants Support for preparing deteriorated vacant properties for Up to $150,000
residential or mixed-use redevelopment or demolition of
blighted structures
Grants to PDCs Support for planning district commissions statewide in $1M–$3M per PDC
efforts to address housing shortages and related issues
Source: Virginia Housing69
These programs, in addition to DHCD’s housing programs and resources, do not address the market challenge
that has persisted in Southwest and Southside Virginia. With market forces pushing developers to continue
building elsewhere, new programs or modifications to existing programs will need to occur to spur the level of
private investment needed to meet the demand.
Housing – Recommendations and Models for Success
Recommendation F: Modify existing program parameters and/or develop a new program that funds community
investments in pre-development housing infrastructure in rural Virginia. The program(s) should:
■
Provide matching funding that localities can use to extend utility, broadband, and road infrastructure to a
future residential development site, purchase property for future development, and modify existing land or
structures on a future residential development site
■
Provide additional funding for schools and local services (such as police and fire) for communities that have
secured commitments from a residential developer
■
Incentivize communities to zone for multifamily housing units (in line with a recommendation from JLARC’s
2021 study of Affordable Housing in Virginia)70
Several localities in Southwest and Southern Virginia are now combating their housing shortage through various
methods. Many localities and regions have begun conducting housing studies that demonstrate to potential
developers the housing need. In August of 2022, Southside hosted the Southern Virginia Housing Summit with
potential developers to showcase what has been done in the community and highlight opportunities for
development.71 Several communities are also trying a site preparation approach to attract developers. Wise
Southside-Southwest Virginia Barriers to Infrastructure and Supply Chain Investment | 2022 36
County is leveraging an Abandoned Mine Land Economic Revitalization (AMLER) grant to demolish an old high
school and prepare the land for future multifamily development. They are also exploring other local tax credits to
entice developers to the area. Pittsylvania is working with developers for an 800-unit housing development by
extending water and sewer lines. Danville is planning to purchase land and extend utility services to prepare for
future developers. In service of supporting project wins in the region, housing development in this way is a tool
for economic development. The trailblazing efforts of these and other localities provide a framework that could
be expanded upon using state resources.72
Several state programs provide models Virginia could pursue. The Massachusetts Housing Choice initiative is a
grant program that incentivizes localities to incorporate new construction of affordable housing into their
long-term planning processes so that housing stock becomes more diverse over time. Localities demonstrating
a multi-year commitment to developing affordable housing can apply for up to $250,000 in grants for various
purposes, including planning, infrastructure improvements, and other capital investments. Massachusetts
budgeted $4 million for this program in FY23, and there are currently 85 qualifying localities. After a successful
initial pilot of the Housing Choice initiative, Massachusetts created a separate $3 million program for rural and
small towns, which can apply for up to $400,000 in funding per award cycle.73
Another potential model is Nebraska’s Rural Workforce Housing Fund (RWHF), administered by the state’s
Department of Economic Development along with several other housing-focused programs. The RWHF provides
competitive matching grants for affordable housing projects in rural communities that can demonstrate an
economic development benefit to increasing their affordable housing stock, such as difficulty filling open
positions or attracting workers due to a lack of housing. Funds can be used for a variety of purposes, including
infrastructure development and building rehabilitation or demolition. In FY22, Nebraska allocated $30 million to
this program.74
Recommendation G: Maintain or expand Virginia’s Historic Rehabilitation Tax Credit to further incentivize
development among a variety of historic building types in rural areas. Ways to expand the use of the tax credit
include:
■
Lowering the assessed value thresholds for a rehabilitation project to qualify for the credit
■
Increasing the percentage of eligible rehabilitation expenses that can be claimed for the tax credit
■
Raising the cap for the maximum credit a project can receive
■
Modifying any of the above program parameters by locality (e.g., distressed localities could have lower
rehabilitation expense requirements to qualify)
Revitalization of historic downtowns hinges on this tax credit. It has been leveraged largely in major urban
areas, driving much of the downtown improvements seen in Richmond and other areas. Rural parts of the state
are starting to utilize this tax credit even more since major cities have fewer historic buildings left to develop.
Carroll County used the tax credits to rehabilitate a former high school in 2021.75 Many of the market-rate
redevelopments in Danville’s River District have leveraged the Historic Rehabilitation Tax Credit. The future
redevelopment of White Mill, an iconic former industrial building on the Dan River, will also be financed in part
through the state and federal versions of these tax credits.76 The state should maintain this credit as developers
shift their focus to rural downtowns. To accelerate rural downtown redevelopment, modifying the requirements
and caps on the credit will allow more properties to be profitable for redevelopment.
Southside-Southwest Virginia Barriers to Infrastructure and Supply Chain Investment | 2022 37
Childcare and Healthcare
Childcare and Healthcare - Barriers
A shortage of childcare and healthcare resources can make it difficult for people to successfully enter or remain
in the labor force when the demands of a job compete for the ability to provide care for other family members.
The availability of childcare services also contributes to a robust workforce by providing parents with the
flexibility to pursue additional education and training. According to a 2021 Bipartisan Policy Center survey, 64%
of nonworking rural parents said childcare responsibilities significantly influenced their decision to not
participate in the workforce.77
Similar to challenges with housing in the Southwest and Southside region, gaps in childcare and healthcare
resources are not being reasonably closed with the private sector alone. The region has the widest gap in the
state in terms of available childcare options (Figure 25). The regions have the capacity to serve roughly 39%
of children under five. Factors contributing to the gaps in childcare services include limited available center
startup capital and shortages in the early childhood workforce. The lack of available options strains existing
childcare facilities, forcing parents to make difficult tradeoffs between going to work or staying home to care
for their children.
It is important to note that in rural areas like Southwest and Southside Virginia, family-based childcare is
often preferred. Nationwide, home-based providers account for approximately 20% of licensed childcare slots
in rural America, compared to 9% and 14% in suburban and urban settings, respectively. Any solutions to
address this challenge should be flexible enough to incorporate various types of childcare that could be made
available in the region.78
Figure 25
Percent of childcare spots for children five and under relative to total number of children five and under in Virginia
70%
60%
50%
40%
30%
20%
10%
0%
Southwest/Southside Other Rural/Mixed Rural Mixed Urban Urban
Source: Child Care Aware of Virginia79; U.S. Census80; VEDP analysis
Southside-Southwest Virginia Barriers to Infrastructure and Supply Chain Investment | 2022 38
Southwest and Southside face a more complex set of healthcare challenges than the rest of the state. In
addition to the opioid crisis and its devastating impact on communities across the region, other fundamental
measures of healthcare needs are much higher for Southwest and Southside Virginia than the rest of the state.
Nine percent of the population is over 75 years old, compared to 8% in Other Rural-Mixed Rural areas, 7% in
Mixed Urban areas, and 5% in Urban areas. According to the U.S. Census, the percentage of people with an
independent living difficulty is 8%, nearly double the rate in the rest of the state (Figure 26).
While the need exists, the market for providing care is constrained by geographic and economic factors. There
are nearly three times as many patients for each elderly/disabled service worker in Southwest, Southside, and
other rural areas compared to more urbanized areas. As with childcare, the lack of health services and people to
care for patients forces difficult tradeoffs for healthy, working-age people with family members that require
assistance and care.
Figure 26
Number of potential patients per elderly/disabled service employee in Southwest and Southside Virginia, 2019
Southwest-Southside Other Rural/Mixed Rural Mixed Urban Urban
40
30
20
10
0
People with an Independent Living Difficulty People 75+ per Elderly/Disabled
per Elderly/Disabled Service Employee Service Employee
Source: U.S. Census81
Southside-Southwest Virginia Barriers to Infrastructure and Supply Chain Investment | 2022 39
Childcare and Healthcare – Recommendations and Models for Success
Recommendation H: Modify existing program parameters and/or develop a new program that funds community
partnerships with private and nonprofit sector investments in childcare and healthcare capacity in rural Virginia.
The program(s) should:
■
Provide grants and/or matching funding to localities working with nonprofit and for-profit service entities and
private sector employers to address childcare, healthcare, and other community-identified workforce-
inhibiting challenges
■
Enable localities and their nonprofit, for-profit, or private sector partners to invest in the construction of
facilities, hiring of staff, development of resources, provision of transportation, and other needs that would
facilitate the use of childcare, healthcare, and other services
Several regional efforts demonstrate how places are already innovating in these areas to meet the needs of
working families. For example, Smart Beginnings Danville Pittsylvania (SBDP) used a substantial investment
and partnered with Head Start to identify, test, and solve early childhood literacy issues. Using local resources
and community partnerships, SBDP created a sustainable system and closed the early childhood literacy gap
with family and community participation.82 The United Way of Southwest Virginia has also created an initiative
to expand access to affordable childcare and provide more professional early childhood educators.83 On the
healthcare front, the nonprofit Health Wagon provides mobile care and telehealth services for Southwest
Virginia, filling the void left behind by the closing of many brick-and-mortar medical care facilities.84 Expanding
funding to encourage these public-private partnerships would help reduce childcare and healthcare shortages in
the region, enabling more individuals to join the region’s workforce.
For childcare, Kentucky has implemented a state model that encourages employer-employee collaboration to
enable childcare access. State policymakers have partnered with the Kentucky Chamber of Commerce to set up
a family childcare home network, which small businesses leverage to help their employees find childcare. The
program allows employers to assist with an employee’s childcare costs with matching payments. This program
has been effective at making childcare more affordable and successfully leveraged the private sector to address
the issue.85
North Carolina has begun to invest heavily in expanding healthcare services to rural areas. In their FY22 state
budget, they provided $4 million to the Health Loan Assistance Repayment program to incentivize providers to
practice in rural regions.86 The state’s Office of Rural Health has a $9 million Rural Health Centers Capital Grant
to fund rural health infrastructure projects.87
Southside-Southwest Virginia Barriers to Infrastructure and Supply Chain Investment | 2022 40
Talent Attraction Amenities
Talent Attraction Amenities – Barriers
Vibrant main streets, cultural and natural resources, broadband, and other amenities are critical for attracting
and retaining talent in rural areas. Virginia Main Street, Virginia Telecommunications Initiative, small business
financing programs, Virginia Tourism’s Festivals Program and Drive Outdoor Grant Program, and many others
contribute to developing attractive communities in Southwest, Southside, and the rest of Virginia.
The state’s support for these programs should be maintained as communities take steps to revitalize assets to
attract and retain talent. However, in many areas of Southwest and Southside, the programs are underutilized
because many rural areas do not have economic development capacity to seek out those resources. Instead of
an additional recommendation, this section echoes the challenges described earlier in the report’s Capacity in
Economic Development section and acknowledges that Recommendation A will be the key avenue for unlocking
additional resources for communities.
Talent Attraction Amenities – Recommendations and Models for Success
Recommendation I: Maintain existing enterprise zones in Southwest and Southside Virginia
Enterprise zones incentivize investors to develop industrial, commercial, or residential property in a designated
area determined by the state. This program has spurred mixed-use developments, commercial districts, and
other structures contributing to the quality-of-life assets essential for talent attraction and retention. Most of
these zones are located in Southwest and Southside (Figure 27), and some have seen limited or no investments
to date. Similar to the challenges seen with housing in the region, developers are less inclined to build in areas
that have smaller profit margins. While the areas may have yet to attract development, eliminating the incentives
from economically depressed areas will only discourage future development. The current areas designated for
this incentive should be maintained for when the opportunity is right for development to occur.
Figure 27
Optimal industrial development areas in Virginia
Enterprise Zone Designation
Enterprise Zone Boundary
Locality with an Enterprise Zone
Source: DHCD; VEDP, July 201988
Southside-Southwest Virginia Barriers to Infrastructure and Supply Chain Investment | 2022 41
Site and Building Development
Site and Building Development – Barriers
When seeking to locate new facilities or to expand existing ones, firms look to reduce risk and be operational
as quickly as possible. This is determined by the availability of ready sites and buildings. Long lead times for
rezoning, planning, right-of-way acquisition, utility construction, and access constraints affect a firm’s speed-
to-market and increase the risk. Without prepared sites or buildings, localities and regions will not be
competitive for these investments.
Communities in Southwest and Southside Virginia have target industries such as advanced manufacturing,
food and beverage manufacturing, and distribution/logistics are site and building intensive. Both regions have
developed sites or shell buildings and successfully turned those into project wins. For example, Blue Star, a
nitrile glove manufacturer, announced the creation of 2,500 jobs in Wythe’s Progress Park, and SCHOCK chose
to locate its 355-job facility in a shell building in Henry County’s Patriot Centre Industrial Park.89
Southwest and especially Southside have supplies of available, project-ready sites comparable to other
regions of the state (see Table 8). However, both have fewer sites in their site preparation pipelines, limiting
their ability to backfill as project-ready sites are taken off the market by prospects. Additionally, with few
project-ready sites over 50 contiguous acres available, Southwest and Southside may lack sufficiently diverse
portfolios to attract the full range of industries they target. Nevertheless, both regions have overcome
substantial fiscal and physical constraints to create competitive site portfolios.
Table 8
Sites listed in VEDP’s marketing database by region and largest contiguous acreage
Available Sites (acres) Project-Ready Sites (acres)
GOVA Region 50–99 100–249 250+ 50–99 100–249 250+
1. Southwest 11 6 2 1 2
2. Roanoke/Lynchburg/NRV 17 13 1 2 1
3. Southside 11 12 3 2 2 1
4. Greater Richmond 31 33 17 1 5 3
5. Hampton Roads 23 13 5 2 1 1
6. Greater Fredericksburg 17 23 10 1
7. Northern VA 3 1 1 1
8. Shenandoah Valley 18 13 1 1 1
9. Greater Charlottesville 19 6 4 2 2 1
Total 150 119 44 12 14 6
Source: VirginiaScan90
Note: Project-ready sites are Tier 4 and 5 sites using the VBRSP Tiering system; these sites can accommodate a medium industrial user
within 12–18 months.
Southside-Southwest Virginia Barriers to Infrastructure and Supply Chain Investment | 2022 42
One driver of this development success has been the Southwest and Southside communities’ ability to leverage
federal, state, and regional-specific funding pools. Sites in Norton, Prince Edward, Pittsylvania, and Henry have
been awarded Virginia Business Ready Sites Program site development funding. The Southwest communities of
Russell, Dickenson, Wise, and Norton have secured federal funding from the Abandoned Mine Land Economic
Revitalization (AMLER) program to transform legacy mining assets into industrial sites. All Southwest and two
Southside localities are also eligible for Appalachian Regional Commission (ARC) grants, which have funded
improvements on sites such as Project Intersection in Norton and Red Onion Industrial Park in Dickenson
County.91 Additionally, TRRC has been an active funder of site improvements and shell building construction
throughout both regions. VCEDA has made similar investments in locality sites and shell buildings in the
Southwest.92
Comparatively, low land prices provide an additional regional advantage.93 Localities can establish site control
relatively inexpensively and have reduced costs when establishing easements and conservation areas. Despite
these cost and funding advantages, Southside and Southwest also face structural challenges to site
development that increase costs and risks. The regions face diverse environmental, geological, and topographic
obstacles and conditions that can impede utility extensions and site access. Widespread economic distress,
constraints on economic development organization capacity, and limited private investment additionally inhibit
site development funding.
Physical barriers exist to site development in both regions. In 2019, VEDP worked with engineers, site selectors,
local and regional economic developers, and utility partners to survey 466 sites over 25 acres across the
Commonwealth. The study found that challenging topography — especially steep grades — existed on
approximately one-quarter of all sites located in the Southwest and Southside regions. While this factor can be
partially mitigated by local construction companies with experience addressing steep grades, significant slopes
can reduce firms’ ability to visualize their project on-site and can require expensive grading prior to securing a
facility. Geology and floodplains also increase development risk in Southwest and Southside, respectively.
Thirty-five percent of Southside sites surveyed in 2019 had segments impacted by 100-year floods, and 48% of
Southwest sites surveyed had bedrock or sinkhole coverage on over a tenth of their area. Extensive due
diligence is required to minimize the costs and risks associated with these issues.94
Figure 28
Optimal industrial development areas in Virginia
■
Optimal Development Areas
— Less than or equal to 2% grade
— Not already developed
— Not a wetland
— Not conservation land or easement land
Source: Slope, developed land, wetlands, conservation, and easement lands – Virginia DCR95; VEDP Analysis 2022
Southside-Southwest Virginia Barriers to Infrastructure and Supply Chain Investment | 2022 43
Figure 29
Optimal Industrial Development Area as a Portion of Total GOVA Area
Optimal Development
0% 50% 100%
Region 1 0.8
Region 2 1.3
Region 3 3.9
Region 4 19.5
Region 5 30.8
Region 6 17.4
Region 7 4.1
Region 8 3.1
Region 9 4.4
Source: Slope, developed land, wetlands, conservation, and easement lands – Virginia DCR96; VEDP Analysis 2022
Providing sufficient utility access and capacities can also be challenging for some Southwest and Southside
sites. Lack of natural gas is a particular concern for many Southside sites, with only 37% of those surveyed in
2019 able to provide gas within 24 months. Access to sufficient power for a medium industrial user is likewise
a challenge for many Southwest sites. Fewer than half the sites surveyed in 2019 could provide enough
capacity within 12–18 months.97 While both regions had broadly competitive wet utility (water and sewer)
connectiveness, several Southside sites required major systems upgrades or would rely on on-site well and
septic systems, sharply limiting their attractiveness to most industrial users. Since water, sewage, and power
access is usually provided along major transportation routes, the distance from transportation arteries of
many sites in the study area is often a fundamentally linked development problem (see Infrastructure section).
Lastly, a lack of staff capacity, local funds, and limited private investment activity can restrict Southwest and
Southside communities’ ability to pursue site development. Based on the 2022 Commonwealth’s Development
Opportunity Fund (COF) categorization, all but one locality in Southwest and Southside are distressed, with
75% of Southwest localities and 73% of Southside localities classified as double-distressed.98 This distress, as
measured by elevated levels of poverty and unemployment, can strain local finances, reducing the resources
communities can put toward site development or as a match for federal or state grants.
State programs such as the Virginia Business Ready Sites Program (VBRSP), the Economic Development
Access Program (EDAP), and GO Virginia have worked to ensure that distressed localities can access
development funding. VBRSP match requirements and EDAP capital investment requirements are reduced
based on a locality’s distress level. Both VBRSP and GO Virginia allow recent past investments and in-kind
contributions to count towards match, providing additional flexibility for applicants.
Southside-Southwest Virginia Barriers to Infrastructure and Supply Chain Investment | 2022 44
Communities across the Southwest and Southside have also taken steps to maximize the benefit of limited
site development resources. Many sites across the regions are jointly developed by multiple localities using
Regional Industrial Facilities Authorities (RIFAs), which share revenue created on a site in proportion to
localities’ investments. Communities increasingly view their neighbors as partners in site development rather
than competitors, as jobs and economic activity generated at one site create regional growth and
opportunities. Southwest and Southside communities should be applauded for this collaboration and
encouraged to further develop regional portfolios of complementary sites.
Another potential method to circumvent constrained local budgets is to drive additional private investment
into sites. However, in comparison to other regions of Virginia, private site investment has had limited impact
in Southwest and Southside. As of Nov. 31, 2022, 62% of Southwest sites and 72% of Southside sites listed in
VEDP’s marketing database were publicly owned, while no other region had over 33% public ownership. No
Southwest or Southside privately-owned sites were project-ready (VBRSP Tiers 4 or 5) or had completed due
diligence and were zoned for industrial or commercial use (Tier 3). In recent years, private industrial
developers have concentrated on preparing sites and speculative buildings for distribution/logistics projects
in proximity to major metropolitan statistical areas (MSAs), interstates, and port infrastructure due to high
demand from e-commerce and low development costs relative to manufacturing. As much of Southwest and
Southside is distant from major urban areas and transportation corridors, site development in the regions will
likely remain public investment-driven, though communities should seize opportunities for public-private
partnership.99
Site and Building Development – Recommendations and Models for Success
Recommendation J: Increase funding for site development in the Commonwealth
Site development, particularly targeting transformational manufacturing projects, is a long-term investment in
local, regional, and state economic health and finances. Without prepared sites, Southwest and Southside Virginia
will not secure growth in their target industries, and Virginia will forgo revenue and opportunities for its citizens.
The Commonwealth created valuable tools like the Virginia Business Ready Sites Program and GO Virginia to fund
site development, but a legacy of underinvestment resulted in a smaller ready portfolio than many competitor
states. This leaves Virginia at a significant disadvantage when competing for industrial projects compared to our
peer states and other key competitors like Kentucky and Ohio (Figure 30).
Southside-Southwest Virginia Barriers to Infrastructure and Supply Chain Investment | 2022 45
Figure 30
Comparison of peer state site development funding ($M)1
263
150 145 137
103
72
28
Kentucky Ohio North South Virginia Georgia Tennessee
Carolina Carolina
Three-year, pre-prospect site development investment totals (19–21 for most states) by state, based on most recent available data;
1
Georgia does not fully disclose funding amounts; Georgia Power provides significant site funding; acquired $61M Bryan County sit
Source: Various annual reports, state budget documents, and grant reporting systems from state agencies in Georgia, North Carolina,
South Carolina, Tennessee, and Virginia100
Recent activity has begun to help close the gap between Virginia and its peers. Since 2019, Virginia possess
best-in-class information on sites across the state, which has concentrated local, regional, and state
investments on the most impactful sites. In 2022, the General Assembly formally established the Virginia
Business Ready Sites Program Fund and appropriated $150 million over the biennium, an order of magnitude
greater than previous funding. Continued state investment into sites will both directly prepare additional
property in Southwest and Southside and spur local and regional activity as the Commonwealth becomes
increasingly viewed as an impactful partner.
Recommendation K: Develop a program(s) that funds community efforts to develop shell buildings and
source new sites
Shell buildings can serve as an attractive asset for localities seeking manufacturing facilities by reducing
speed-to-market. The Strategic Plan for Economic Development of the Commonwealth of Virginia notes that
an estimated 75% of economic development prospects begin their search by examining existing facilities but
that rural, economically distressed areas like Southwest and Southside have not been able to meet that
demand.101
While Southwest and Southside have a portfolio of 38 industrial buildings as of December 2022, less than half
align well with current market demand. A February 2022 VEDP analysis classified industrial buildings as
marketable if they were single-tenant and had over 40,000 sq. ft. of available space. Sixteen buildings in
Southwest and Southside meet those criteria, and only 10 buildings also have ceiling heights above the
commonly requested 24-foot threshold. Of those, only the Cane Creek Center in Pittsylvania is a dedicated
shell building.102
Southside-Southwest Virginia Barriers to Infrastructure and Supply Chain Investment | 2022 46
Since 2007, Virginia has lacked a program to support the development of shell buildings and has seen its
available stock of prepared facilities diminish as industrial users have moved in. Creating a targeted program or
modifying existing programs to finance shell building construction would begin the process of re-establishing a
competitive industrial building portfolio statewide, with concentrated impacts on rural regions such as
Southwest and Southside.
A separate programmatic need is state support for the identification of new sites. While sites are being prepared
for prospective companies, communities and regions must proactively identify future candidates for development
to avoid periods in which they are unable to compete due to lack of property. The Commonwealth’s regions have
unique targets, assets, and portfolios and should actively pursue their own site identification strategies.
Providing matching funds to help localities and regions source new sites will strengthen Virginia’s site portfolio
for decades to come. Resourced, data-driven site identification efforts can minimize future costs and maximize
site attractiveness by prioritizing proximity to utilities and transportation assets and reducing the risk of
environmental impacts. As Southwest and Southside have limited available and marketed sites to backfill their
current project-ready sites, such identification efforts will prove particularly impactful in unlocking future
industrial growth.
Southside-Southwest Virginia Barriers to Infrastructure and Supply Chain Investment | 2022 47
Infrastructure
Infrastructure – Barriers
Companies prioritize infrastructure assets to decrease transport costs, improve access for workers and executives,
and facilitate their operations. Access to major highways, interstates, railroads, airports, and non-transportation
infrastructure like utilities and broadband are key factors companies consider when making location
decisions.103 Improving that infrastructure and locating sites and buildings strategically near infrastructure
access points is imperative when considering the competitive landscape for supply chain investments.
Planning for and developing transportation infrastructure is a complex process that requires input at the local,
regional, state, and sometimes federal levels. Again, having the capacity and resources to conduct studies,
engage the community and stakeholders, apply for and manage grants, and coordinate with state and federal
entities all require staff and financial resources (especially for grant program match requirements) that are
limited in many Southwest and Southside communities. Virginia lags behind competitor states in capturing
competitive federal infrastructure grants (Figure 31). Over the last six years, Georgia and North Carolina
outpaced Virginia by $100 million in infrastructure grant awards; Tennessee saw nearly $75 million more in
grants. Solving the challenge of constrained staff and financial resources that can develop applications for
these programs is critical to unlocking further infrastructure investments.
Figure 31
Per capita funding received from competitive U.S. Department of Transportation rural-focused programs,
FY17–FY22 (rural and mixed-rural populations)
$200
$150
$100
$50
$-
Georgia Tennessee South Carolina North Carolina Virginia
Source: Brookings Institution104; U.S. Department of the Treasury105; VEDP analysis
Southside-Southwest Virginia Barriers to Infrastructure and Supply Chain Investment | 2022 48
In addition to overcoming this barrier, state transportation infrastructure priorities should be considered for
immediate and long-term funding. According to publications that interview site selectors and CEOs, interstate
and highway infrastructure is a major factor for most companies when making location decisions. Site Selection
magazine ranks infrastructure accessibility as the fourth most important factor for company location decisions,
and Area Development ranks highway accessibility third. Having access to interstates and highways with
interchanges increases the workforce pool a company can draw from and reduces the financial and time cost
of transporting products by truck. This importance is demonstrated noticeably by the number of projects that
locate in counties with limited access to highway infrastructure versus those that locate in counties without
limited access highways (interstates or highways with bypass ramps).
Since 2012, rural counties in the Southeastern U.S. without access to a limited access highway saw an average
of three projects; rural counties with a limited access highway saw an average of seven projects. The contrast is
seen in Figure 32, with project announcements following the line of interstates and primary highways across the
Southeastern U.S.
Figure 32
Project announcements (new and expansions) since 2012
Counties with limited highways
Counties without limited highways
Project announcements (2012–2022)
Source: Conway106; VEDP analysis
Southside-Southwest Virginia Barriers to Infrastructure and Supply Chain Investment | 2022 49
Southwest and Southside, along with other rural areas of the state, are at a disadvantage when it comes to
major road access. Southwest has the least amount of land accessible by major roadways (interstates and
four lanes), and Southside has the least amount of land accessible by limited access highways like interstates
(Figures 33 and 34).
Figure 33
Areas of the state within 15 minutes of major roadways
Area within 15 minutes of a limited access highway
(interstate or equivalent)
Area within 15 minutes of
additional four lane roads
Source: VEDP analysis, 2017
Figure 34
Areas of GO Virginia regions proximate to a commercial airport
Limited access highway within 15 min Four lane road within 15 min Other
0% 50% 100%
Region 1 16.1 20.8
Region 2 13.1 25.9
Region 3 10.2 37.8
Region 4 53.1 16.5
Region 5 30.4 36.6
Region 6 14.2 43.8
Region 7 72.1 12.8
Region 8 30.6 11.6
Region 9 16,9 34.4
Source: VEDP analysis, 2022
Southside-Southwest Virginia Barriers to Infrastructure and Supply Chain Investment | 2022 50
Virginia has two major road projects in the early stages that would provide a competitive advantage for
Southwest and Southern Virginia. The first is the planned Interstate 73 corridor connecting Greensboro in North
Carolina (where the interstate is partially built already) to Roanoke through Martinsville. This project would put
the megasite at Berry Hill and the outer edges of Danville within 20 minutes of a major interstate. I-73 received
federal approval and passed environmental impact assessments in 2006 and again in 2012 but has not seen
committed funding for the project.107
The second road project is the Coalfields Expressway, which would connect the counties of Buchanan,
Dickenson, and Wise Counties to the crossroads of I-77 and I-64 in West Virginia. The project’s estimated cost is
$3.1 billion, but the four-lane road is expected to yield long-term dividends in tourism and economic activity to
communities in the region. Planning dollars are still being allocated from federal and state sources to study
piecemeal segments of the project, but no transformational investment has been made to date.108
The regions also lack a streamlined link to The Port of Virginia. The fastest route from major cities in the
Southwest requires trucks to drive up I-81 to I-64 and then take I-64 down to Hampton Roads, a route fraught
with traffic challenges. US-58, the most direct route, has lower speeds than other highways in many areas and
passes directly through communities, creating a transport disadvantage for companies prioritizing product-to-
market speed. The lack of limited access highway infrastructure across the bottom of the state makes the Port
of Wilmington competitive with The Port of Virginia for Southside cities like Danville and Martinsville, and the
Ports of Wilmington and Charleston competitive with The Port of Virginia for Southwest communities (Table 9).
Table 9
Drive times from major Southwest-Southside cities to select Southeastern Ports
Locality Destination Route Distance (mi) Time
Bristol Port of Virginia I-81 & I-64 418 6h 11m
Bristol Port of Virginia I-81, I-77, & US-58 387 6h 41m
Bristol Port of Wilmington I-81, I-77, & I-74 392 6h
Bristol Port of Charleston I-26 350 5h 30m
Wytheville Port of Virginia I-81 & I-64 347 5h 10m
Wytheville Port of Virginia I-77 & US-58 317 5h 40m
Wytheville Port of Wilmington I-77 & I-74 321 4h 57m
Wytheville Port of Charleston I-77 & I-26 345 5h
Danville Port of Virginia US-58 193 3h 27m
Danville Port of Wilmington US-86 & I-40 218 3h 39m
Danville Port of Charleston US-29, I-74, I-95, I-26 320 5h 9m
Martinsville Port of Virginia US-58 225 4h
Martinsville Port of Wilmington US-220, I-73, & I-74 268 4h 12m
Martinsville Port of Charleston US-220, I-74, I-95, I-26 326 5h 20m
Source: Google Maps109
Southside-Southwest Virginia Barriers to Infrastructure and Supply Chain Investment | 2022 51
The development of major roadways also improves connectivity to airports. Commercial airports provide
company executives with easier access to their facilities and can give communities a competitive edge for
location decisions. Southwest and Southside, shown in Figure 35 as GO Virginia Regions 1 and 3, are the only
regions in Virginia where less than 50% of the area can reach a commercial airport within 60 minutes, and less
than a quarter of the area can reach one within 45 minutes. Adding more limited access highways and improved
four lanes will improve access to these economic assets.
Figure 35
Areas of the state within a 45- and 60-minute drive time to a commercial airport
Area within 45 minutes of a commercial airport
Area within 46–60 minutes of a
commercial airport
Source: VEDP analysis, 2022
Figure 36
Areas of GO Virginia regions proximate to a commercial airport
45 minutes or less 45 to 60 minutes 60 minutes or more
0% 50% 100%
Region 1 11.3 13.3
Region 2 66.0 22.7
Region 3 10.0 30.8
Region 4 56.3 31.8
Region 5 46.3 23.7
Region 6 25.6 36.1
Region 7 97.4 2.6
Region 8 35.4 30.6
Region 9 58.0 36.3
Source: VEDP analysis, 2022
Infrastructure – Passenger Rail
An extension of passenger rail service to Bristol is another project that could yield additional economic
investment in the region. Presently, the Southwest region of Virginia is similar to other areas of the Southeastern
U.S. that lack passenger rail, including central Georgia, central Tennessee, and blue-ridge North Carolina. Many
of these regions are already successful economically without passenger rail. However, extending passenger rail
to Bristol could set the region apart from other areas in the Southeastern U.S. without significant service,
especially in terms of quality of life and accessibility for tourism.
In 2021, the Virginia Department of Rail and Public Transportation (DRPT) released a study exploring the
extension of the Amtrak Washington, D.C. to Roanoke service to Bristol down the I-81 corridor. This extension
would be a significant expansion of the passenger rail network in the study region, bringing up to four new rail
stations in GO Virginia Region 1, at Wytheville, Marion, Abingdon, and Bristol, totaling up to $1.5 billion. The
report recommended the railroad for further study, citing its potential impacts on Southwest and the potential to
work with Tennessee authorities to increase ridership by extending the railroad to Knoxville.110
Missing from the 2021 DRPT report on the Bristol Amtrak extension is an economic impact analysis for
Southwest or a holistic cost-benefit analysis of the proposal. Such analyses should be carried out, ideally
comparing the investment necessary for the railroad with several other investment scenarios.
There is one existing passenger rail service in the Southwest-Southside region. In GO Virginia Region 3, Danville
is served by Amtrak’s Crescent service, running from New York to New Orleans via the Northeast Corridor,
Washington, D.C., Charlotte (NC), Atlanta, and Birmingham (AL). In 2020, the Southeast Corridor Commission, a
federally designated commission tasked with studying rail traffic in the Southeast, produced a planning study. In
this study, the main train route from Washington, D.C., to Greensboro (NC) and further to Atlanta (GA) would be
rerouted from its current Danville alignment to a new alignment through Richmond and Raleigh-Durham (NC). This
realignment may lead regional rail planners to decrease or no longer provide service to Danville in the future.111
Stakeholders in GO Virginia Region 3 should proactively pursue a study, in collaboration with DRPT, to understand
passenger rail’s economic impact, including an exploration of service alternatives. Any further studies of rail
services should include an analysis of the economic impact of more frequent and deliberately timed services, as
all current or proposed services run infrequently and at odd hours of the day, limiting their use.
Infrastructure – Broadband
Broadband infrastructure is critical for businesses to operate competitively in the economy and utilize the
newest technologies for their operations. It is also vital for attracting the next generation of talent to an area.
Virginia has taken great steps to ensure broadband access across Southwest, Southside, and other rural areas
of the state. Several key programs and organizations that have contributed to the expansion of broadband
include:
■
Virginia Telecommunication Initiative (VATI) – the program has extended broadband service to unserved
areas by building, utilizing, and capitalizing on telecommunications infrastructure, with the intent to develop
strong, competitive communities.112
■
Tobacco Commission Last Mile Broadband Program – TRRC addresses the digital divide between
telecommunications infrastructure and service created by the lack of “last-mile” services in the region.113
Southside-Southwest Virginia Barriers to Infrastructure and Supply Chain Investment | 2022 53
■
VCEDA Education and Telehealth Access Fund – Partnering with the Appalachian Council for Innovation
(ACI), the $500,000 fund is intended for the development of space-based broadband service in the VECDA
e-Region. The funds leverage local, state, federal, and private grants and awards that ACI also plans to pursue
for the initiative.114
■
GO Virginia – Funds have contributed to broadband projects across the Commonwealth, expanding
middle-mile broadband service to many localities. $5 million in 2022 was awarded to extend middle-mile
fiber to business and industrial parks in GO Virginia Regions 3 and 4.115
Even with these investments, more than 210,000 locations have deficient or no broadband and lack funded
broadband infrastructure plans. The state is targeting full coverage by 2024 and is a major focus of the
Youngkin Administration. Worker shortages and supply issues with the deployment of broadband infrastructure
pose challenges, but the funding and energy remain in place to ensure this achievement will be met.116
Infrastructure – Recommendations and Models for Success
Recommendation L: Expand staff capacity in local, regional, or state organizations to pursue federal and state
infrastructure funds for roads, rail, and broadband (see Recommendation A)
Several states, including North Carolina and Tennessee, provide funding resources for communities to plan for
infrastructure improvements. Additional capacity and funding for studies help local governments gain a deeper
understanding of their unique strengths and challenges so they can better target their efforts to leverage state
and federal infrastructure grants. As part of North Carolina’s new Rural Community Capacity initiative, local
governments can apply for up to $950,000 for a variety of purposes, including studying and planning for
infrastructure improvements.117 Tennessee’s program is smaller in scale and is limited to $50,000 and must be
targeted to the study of local water utility infrastructure challenges.118
The 2021 federal infrastructure bill has several programs for funding large grant projects in addition to block
grants administered through VDOT that the regions should consider for major infrastructure investments. The
Rural Surface Transportation Grant, Infrastructure for Rebuilding America (INFRA) Grant, and Mega grants are
all competitive programs focused on improving the safety, connectivity, and movement of freight. The combined
programs will fund up to $15 billion in projects over the next four years. $1.5 billion in INFRA awards were
announced for this funding round, with nearly half of the awards going toward rural projects. This round of
awards ranged from $20–127 million.119 Competing for these grants requires significant staff time and expert
support to develop the grant application and administer the funding. Without additional staff capacity support,
Virginia will remain disadvantaged in accessing this funding to support rural infrastructure development.
Recommendation M: Leverage federal infrastructure funding to accelerate the development of planned interstates,
highways, and expressways in Southwest, Southside, and other rural areas of Virginia
Stakeholders have taken steps to move I-73 and the Coalfield Expressway forward. I-73 passed environmental
impact assessments in 2006 and 2012, and officials have successfully pursued related projects such as the
Martinsville Southern Connector Study. VCEDA and the Coalfields Expressway Authority funded a report to
confirm the cost of the Coalfields Expressway project and demonstrate the potential economic impact that
would justify the investment. The $3.1 billion expressway is expected to generate $12.8 billion over the course
of 50 years. The Authority worked with Virginia’s Congressional delegation to secure $1.9 million in FY22 for
additional planning and design work for a portion of the project. The economic benefits of these projects should
be considered as policymakers contemplate funding for each development’s next stages.120
Southside-Southwest Virginia Barriers to Infrastructure and Supply Chain Investment | 2022 54
Recommendation N: Continue exploring the feasibility of additional inland ports in the Commonwealth
The General Assembly commissioned a study on the feasibility of developing an inland port facility in Southwest
or Central Virginia.121 An inland port in Southwest would provide a competitive advantage for freight movement
to the Port of Virginia and could potentially spur additional manufacturing and logistics/distribution sector
investments in the region. If the study proves an inland port is feasible, regional stakeholders should work with
the Port on the next steps for assessing the development of a facility.
Southside-Southwest Virginia Barriers to Infrastructure and Supply Chain Investment | 2022 55
Incentives
Incentives – Barriers
The tax environment is a major factor for companies when making location decisions. Compared to peer
states, Virginia is generally less favorable, with higher overall taxes across personal, corporate income tax,
and state sales tax rates. This challenge is especially important for communities in Southwest and Southside
that are near the border because many of the same assets and workforce are accessible for companies that
locate in Virginia or a competitor state. With those factors less of a differentiator, the cost of doing business
becomes one of the primary location decision factors and drives company locations towards the side of the
border with lower costs.
its?
North Carolina has lower personal, corporate, and sales taxes than Virginia, and Tennessee phased out its
income tax in 2021. Georgia and South Carolina, other primary competitor states for Virginia, have lower
corporate income tax but equal or higher personal income tax. Additionally, Virginia has slightly lower
corporate and sales tax compared to Tennessee.
Table 10
Top state tax rates for 2022
State Personal Income Tax (%) Corporate Income Tax (%) State Sales Tax (%)
Virginia 5.75 6 5.3
North Carolina 5 2.5 4.75
Tennessee 0 6.5 7
Georgia 5.75 5.75 4
South Carolina 7 5 6
Source: Tax Foundation122
Southside-Southwest Virginia Barriers to Infrastructure and Supply Chain Investment | 2022 56
Energy availability and cost are significant location factors for companies, particularly industrial projects.
Comparatively, Virginia’s cost of electricity per kilowatt hour for industrial use exceeds that of North Carolina,
Tennessee, and South Carolina and is much less than Georgia’s. Virginia’s commercial cost is much lower than
Tennessee, Georgia, and South Carolina but still slightly higher than North Carolina (Table 11).
Table 11
Average price of electricity (cents per kilowatt hour) to ultimate customers by end-use sector, July 2021 to July 2022
Rate, Rank
State Residential Commercial Industrial Transportation All Sectors
Virginia 2.93, #18 9.05, #6 7.7, #26 10.42, #16 10.3, #19
North Carolina 11.74, #10 8.85, #3 6.58, #8 7.33, #3 9.7, #14
Tennessee 11.92, #12 11.76, #32 6.53, #5 - 10.66, #24
Georgia 13.82, #29 12.57, #37 8.91, #37 9.18, #10 12.26
South Carolina 13.73, #27 11.47, #29 6.96, #14 - 10.81, #25
Source: U.S. Energy Information Administration123
Environmental permitting can also be a hurdle for new or expanding companies and can take a significant
amount of administrative work and time. Companies engaged in major projects must apply for upwards of 15
permits across local, state, and federal permitting, and approval can take between 35 days to upwards of 12
months.124 States that can expedite or ease the permitting process have greater success attracting projects due
to the importance of speed-to-market for companies. Site Selection places “ease of permitting and regulatory
procedures” in their top five key location factors for 2022. According to Area Development, Virginia ranks 10th for
speed of project permitting, falling behind Tennessee, which ranks fourth, and other key peer states, such as
Georgia and South Carolina, who both tied for second.125
Incentives – Recommendations and Models for Success
Recommendation O: Establish a manufacturing job creation tax credit that further incentivizes economic
development in rural communities
Much of the cost differences between Virginia and neighboring states could be mitigated through additional
incentives. One incentive that is offered by Virginia’s competitor states is a job creation tax credit. These tax
credits are often tiered by levels of distress for the locality. Georgia’s program, for example, has four tier levels,
with companies locating in rural counties at the highest levels of distress receiving triple the incentive as those
locating in non-distressed metro counties (Table 12). Establishing a targeted manufacturing job creation tax
credit would give rural counties in Virginia a level playing field when competing for projects.
Southside-Southwest Virginia Barriers to Infrastructure and Supply Chain Investment | 2022 57
Table 12
Job creation tax credit programs in competitor states
Annual
Program Expenditure ($M) Award Structure Award Structure
North Carolina Job Development 11.7 (CY21); total 12-year annual credit, with extensions stipulated for
Investment Grant liability capped at transformational projects; companies are reimbursed
$35M per year a percentage of withholding taxes paid by new
employees, up to 75% (80% for Tier 1 counties that
represent the highest distress level)
Tennessee FastTrack 9 (FY22) 1 to 5-year $4.5K per job tax credit, depending on the
Incentives county tier level; job creation requirements range from
a minimum of 10 to 25 jobs, with lower thresholds for
more distressed localities
Georgia Job Tax Credits 31.2 (FY21) $1.25K–$4K per job up to five years based on county
tier level; credits have a 10-year carry forward;
localities with a joint IDA receive $500 additional
incentives per job; job creation requirements range
from a minimum of 2 to 25 jobs, with lower thresholds
for more distressed localities; limited to manufacturing,
distribution, data processing, or HQ
South Carolina Job Development 10 (FY22) $3.25k per job; 10-year annual credit; limited to specific
Credit manufacturing, warehousing, and service sectors
Source: VEDP Analysis; State Budgets and Annual Reports126
Recommendation P: Develop opportunities to expand and fund transparency and speed in permitting programs
Expedited permitting would enable Virginia to compete with peer states more effectively on speed-to-market
factors. Direct competitors, such as North Carolina and Tennessee, surpass Virginia in key permitting measures,
such as permitting speed and are supported by larger annual budgets and staff resources responsible for
environmental permitting. Additionally, DEQ’s staff levels have fallen in recent years, reducing the ability for the
agency to process permits efficiently. These factors have led Virginia to lose projects to peer states with
expedited permitting programs backed by adequate funding and staff. Virgina has begun efforts to increase
permitting speed and transparency with the rollout of the Permitting Enhancement and Evaluation Platform (PEEP).
Table 13
Virginia Department of Environmental Quality (DEQ) permitting staff and budget
Virginia DEQ FY15 FY17 FY19 FY21
Permitting Staff 399 380 375 359
Permitting Budget ($M) $98M $103M $109M $113M
Source: Virginia Department of Environmental Quality128
In addition to state permitting requirements, local permitting can also create delays. A lack of staff capacity at
the local level is often the source of these delays, and should be the main focus of any local or state effort to
increase local permitting speed (See Recommendation A).
Southside-Southwest Virginia Barriers to Infrastructure and Supply Chain Investment | 2022 58
Conclusion
59
Conclusion
Due to the concerted effort of many dedicated people and supportive partners, Southwest and Southside
Virginia have made great strides in overcoming the economic challenges that have affected the region. The
regions are still facing many long-term and structural barriers which will require additional time, focus, energy,
and support to overcome.
This report identified five key categories of barriers to the regions’ goal of securing additional infrastructure
and supply chain investment. The first and most important of those barriers is a lack of dedicated capacity for
economic development. Building strong partnerships, planning for good asset investments, and leveraging state
and federal funding all require staff capacity. Economic developers provide these critical services and are
necessary to enable the region to unlock additional resources.
Three categories cover important economic development assets – workforce, sites and buildings, and
transportation infrastructure. Each requires additional funding and new or modified programs to ensure these
assets are developed to their full potential. Barriers in these areas will require long-term investments that will
lead to a ready supply of skilled workers, a robust site portfolio, and a connected infrastructure network that
maximizes economic development potential.
The final key category, incentives, addresses the competitive challenge posed by Virginia’s neighboring states.
Chief competitor states — North Carolina, Tennessee, Georgia, and South Carolina out-compete Virginia on tax
rates and key incentives, and permitting speed. Addressing the cost-of-doing business challenge will be an
important component to ensure investment is brought within Virginia’s borders.
In highlighting these barriers and looking into best practice models in Virginia and other states, this
report developed recommendations to meet the needs of rural Virginia communities like Southwest and
Southside. These recommendations represent a multi-pronged approach that combines efforts to address
each of the underlying challenges. Implementing all of the recommendations fully is essential to
maximizing economic growth.
Southside-Southwest Virginia Barriers to Infrastructure and Supply Chain Investment | 2022 60
Acknowledgments
61
Acknowledgments
The following organizations and individuals are acknowledged for their time and contribution to this study.
Appalachian Council for Innovation | Executive Director
Bristol Chamber of Commerce | Beth Rhinehart
Callebs Realty, Inc. | Managing Partner
Center for Rural Virginia | Executive Director
Child Care Aware of Virginia | Executive Director; Data Services Coordinator
City of Bristol | Economic Development Specialist
City of Danville | Economic Development Director; Network Manager
Commonwealth Regional Council | Executive Director
Delegate Danny Marshall
Delegate Israel O’Quinn
Delegate Otto Wachsmann
Delegate Terry Kilgore
Delegate Thomas Wright
Department of Housing and Community Development | Deputy Director, GO Virginia and Economic Development
Dickenson County | Economic Development Director
GO Virginia Region 1 | Program Director of Economic Development & GO Virginia Region 1
GO Virginia Region 3 | Program Manager
Greensville County | Director of Economic Development
Halifax County Industrial Development Authority | Executive Director
Institute of Advanced Learning and Research | Chairman of the Board
InvestSWVA | Director
Joint Industrial Development Authority of Wythe County | Executive Director
Lee County | Community and Economic Development Director
LENOWISCO Planning District Commission | Executive Director
Mecklenburg County | Economic Development Director
Southside-Southwest Virginia Barriers to Infrastructure and Supply Chain Investment | 2022 62
Mount Rogers Regional Partnership | Interim Director/Economic Development Manager
Mountain Empire Community College | Vice President for Instructional Advancement
Patrick County | Economic Development Director
Patrick Henry Community College | Vice President, Workforce, Economic & Community Development
Pittsylvania County | Director of Economic Development; Director of Utilities
Powell Valley National Bank | President and CEO
Richmond Federal Reserve Bank | Vice President and Regional Executive
Scott County | Executive Director
Senator Frank Ruff
Senator Mark Peake
Senator Todd Pillion
Senator Travis Hackworth
Smyth County | County Administrator
Southern Virginia Regional Alliance | Executive Director
Tobacco Region Revitalization Commission | Acting Director
UVA Wise | Chancellor; Vice Chancellor for Administration, Government Relations, and Strategic Initiatives
VFP, Inc. | Executive-Vice President/CFO
Virginia Coalfield Economic Development Authority | Executive Director
Virginia Community College System
Virginia Housing | Strategic Housing Officer – Economic Development
Virginia’s Growth Alliance | Executive Director
Washington County | Director of Community Development
Waukeshaw Development, Inc. | President
Wise County | County Administrator/Economic Development Director; Assistant Economic Development Director
Wythe County | County Administrator
Southside-Southwest Virginia Barriers to Infrastructure and Supply Chain Investment | 2022 63
Endnotes
64
Endnotes
1 U.S. Census Bureau (2010). 2010 Census Urban and Rural Classification and Urban Area Criteria. Retrieved
from https://www.census.gov/programs-surveys/geography/guidance/geo-areas/urban-rural/2010-ur-
ban-rural.html
2 U.S. Census Bureau (2011). Land Area, USA Counties: 2011. Retrieved from https://www.census.gov/library/
publications/2011/compendia/usa-counties-2011.html#LND; U.S. Census Bureau (2020). Employment
Status, 2016-2020 American Community Survey 5-year estimates. Retrieved from https://api.census.gov/
data/2020/acs/acs5/subject
3 Moody’s Analytics. Seasonally-adjusted Locality Employment and GDP Data by Industry [Data Set]. Retrieved
November 21, 2022.
4 Arend, Mark. The 2022 Business Climate Rankings. Site Selection magazine. 2022. https://siteselection.com/
issues/2022/nov/the-2022-business-climate-rankings-cover.cfm
5 Gambale, Geraldine. 18th Annual Consultants Survey. Area Development magazine. 2022. https://www.
areadevelopment.com/Corporate-Consultants-Survey-Results/q1-2022/18th-annual-consultants-survey.
shtml
6 Moody’s Analytics. Seasonally-adjusted Locality Employment and GDP Data by Industry [Data Set]. Retrieved
November 21, 2022.
7 Ibid.
8 Ibid.
9 Ibid.
10 Ibid.
11 Ibid.
12 Ibid.
13 Virginia Economic Development Partnership. Commonwealth’s Development Opportunity Fund (COF). 2022.
https://www.vedp.org/incentive/commonwealths-development-opportunity-fund-cof
14 U.S. Census Bureau (2020, 2021). Geographic Mobility by Selected Characteristics in the United States, 2017-
2021 American Community Survey 5-Year Estimates.
15 Bureau of Labor Statistics (2020, 2021, 2022). Local Area Employment Statistics. Retrieved from https://
www.bls.gov/lau/
Southside-Southwest Virginia Barriers to Infrastructure and Supply Chain Investment | 2022 65
16 GO Virginia 1. GO Virginia Region 1 Growth and Diversification Plan. Virginia Department of Housing and
Community Development. 2021. https://wixlabs-pdf-dev.appspot.com/; GO Virginia 3. GO Virginia Region 3
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18 Virginia Economic Development Partnership. Morgan Olson Announces 703 New Jobs in Danville-Pittsylvania
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19 Virginia Economic Development Partnership, Virginia Announcements & Closings Database [Data Set].
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21 Boothe, Charles. Investment in Wythe County: Major manufacturing plant will bring up to 2,500 jobs to area.
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facturing-plant-will-bring-up-to-2-500-jobs-to/article_263fc502-257e-11ec-bd38-f3e80e482e72.html
22 Tobacco Region Revitalization Commission. Tobacco Region Revitalization Commission 2019 Annual Report.
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htc-award-list-2021-11172021.pdf; South Carolina State Housing Finance and Development Authority. SC
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RIA awards record funding to support infrastructure improvements across South Carolina. State of South
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Tennessee Economic and Community Development. OpenECD Dashboard. State of Tennessee. 2021, 2022.
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openecd-rural-community-development-quick-stats/rural-and-community-development-investments.html;
Tennessee Economic and Community Development. FastTrack Database. State of Tennessee. 2022. https://
www.tn.gov/transparenttn/state-financial-overview/open-ecd/openecd/fasttrack-project-database.html;
Virginia Tobacco Region Revitalization Commission. Awards Report. Commonwealth of Virginia. 2022.
https://www.revitalizeva.org/tools-resources/awards-report/; Virginia Resources Authority, Office of the
Governor of Virginia. Four Virginia Communities to Receive Grants to Support Restoration of Brownfield Sites.
Commonwealth of Virginia. 2022. https://www.governor.virginia.gov/newsroom/news-releases/2022/
october/name-940803-en.html; Virginia Department of Transportation. Fiscal Year 2022, VDOT Annual Budget.
Commonwealth of Virginia. 2022. https://www.virginiadot.org/about/resources/budget/VDOT_Final_
FY_2022_Budget.pdf; Virginia Department of Rail and Public Transportation. DRPT Projects Explorer, FY22
SYIP. Commonwealth of Virginia. 2022. https://va-drpt.projects.socrata.com/projects/75922-04?category-
Id=3.0:16.0&tab=list
24 Daughters, Gary. Believing Who You Are. Site Selection Magazine. 2022. https://siteselection.com/is-
sues/2022/july/believing-who-you-are.cfm
25 North Carolina Office of State Budget and Management. Office of State Budget and Management Certified
Budget. State of North Carolina. 2021. https://www.osbm.nc.gov/media/2311/download?attachment; North
Carolina Department of Commerce. Rural Economic Development Division. 2022. https://www.commerce.nc.
gov/about-us/divisions-programs/rural-economic-development-division
26 North Carolina Office of State Budget and Management, Office of State Budget and Management Certified
Budget; North Carolina Department of Commerce. Nineteen Rural Communities Selected for Capacity Building
Program. State of North Carolina. 2022. https://www.commerce.nc.gov/news/press-releases/nineteen-ru-
ral-communities-selected-capacity-building-program
27 Cause IQ. North Carolina Rural Center. 2022. https://www.causeiq.com/organizations/north-carolina-ru-
ral-center,561552375/#financials
28 NC Rural Center. NC Rural Center prepares to deploy $201.8M for small businesses through loans, VC fund
investments. 2022. https://www.ncruralcenter.org/2022/02/prepares-for-small-business-loans/
Southside-Southwest Virginia Barriers to Infrastructure and Supply Chain Investment | 2022 67
29 Rural Infrastructure Authority. Rural Infrastructure Authority Annual Accountability Report. State of South
Carolina. 2022. https://dc.statelibrary.sc.gov/bitstream/handle/10827/46913/RIA_Annual_Accountability_
Report_2022.pdf?sequence=1&isAllowed=y
30 Governor’s Rural Task Force. State of Tennessee. 2016. https://tnecd.com/wp-content/uploads/2018/10/
rtf-final-10102016.pdf
31 Hair, Molly. Governor Lee, Commissioner Rolfe Award Threestar Grants to 54 Tennessee Counties. Tennessee
Department of Economic & Community Development. 2021. https://tnecd.com/news/governor-lee-commis-
sioner-rolfe-award-threestar-grants-to-54-tennessee-counties/; Tennessee Economic and Community
Development. About ThreeStar. State of Tennessee. 2022. https://www.tn.gov/ecd/rural-development/
three-star-tnecd/threestar-about.html
32 See endnote 23.
33 Center for Rural Virginia. 2019-2020 Center for Rural Virginia Annual Report. 2020. https://rga.lis.virginia.gov/
Published/2021/RD350/PDF#:~:text=The%20Center%20for%20Rural%20Virginia%20is%20a%20non%2D-
profit%20501,the%20General%20Assembly%20in%20200
34 Tobacco Region Revitalization Commission. Tobacco Region Revitalization Commission 2021 Annual Report.
2021. https://www.revitalizeva.org/wp-content/uploads/2022/01/TRRC_Report_2021_FINAL.pdf
35 The Golden L.E.A.F. (Long-term Economic Advancement Foundation), Inc. Financial Statements and Other
Report. 2022. https://www.goldenleaf.org/wp-content/uploads/2022/10/Golden-LEAF-2022-Financials_FI-
NAL.pdf
36 Tobacco Region Revitalization Commission. Tobacco Region Revitalization Commission 2021 Annual Report.
2021. https://www.revitalizeva.org/wp-content/uploads/2022/01/TRRC_Report_2021_FINAL.pdf
37 Virginia Economic Development Partnership. Local and Regional Capacity Initiative Report. 2020.
38 Virginia Economic Development Partnership, Virginia Announcements & Closings Database [Data Set].
39 Pipa, Anthony F., Geismar, Natalie. Reimagining rural policy: Organizing federal assistance to maximize rural
prosperity. Brookings Institution, Center for Sustainable Development. 2020. https://www.brookings.edu/
wp-content/uploads/2020/11/Rural-Dev-Assistance-Brief.pdf
40 Bureau of the Fiscal Service. USASpending.gov [dataset]. U.S. Department of the Treasury. 2022. https://
www.usaspending.gov/
41 North Carolina Office of State Budget and Management, Office of State Budget and Management Certified
Budget; North Carolina Department of Commerce, Nineteen Rural Communities Selected for Capacity Building
Program
42 Hair, Governor Lee, Commissioner Rolfe Award Threestar Grants to 54 Tennessee Counties; Tennessee Economic
and Community Development, About ThreeStar
43 NC Rural Center. REDI (Rural Economic Development Institute). 2022. https://www.ncruralcenter.org/leader-
ship/redi/
44 Virginia Rural Leadership Institute. The Virginia Rural Center Announces Virginia Rural Leadership Institute’s
Inaugural Graduating Class. Virginia Rural Center. 2022. https://www.cfrv.org/_files/ugd/c50ea4_6c78b-
063c28440f9bb99f8c1dc62803d.pdf
45 Commonwealth of Virginia. 2022 Special Session I Virginia Acts of Assembly, Item 114. 2022. https://budget.
lis.virginia.gov/item/2022/2/HB29/Enrolled/1/114/
46 North Carolina Office of State Budget and Management, Office of State Budget and Management Certified
Budget.
Southside-Southwest Virginia Barriers to Infrastructure and Supply Chain Investment | 2022 68
47 Hair, Governor Lee, Commissioner Rolfe Award Threestar Grants to 54 Tennessee Counties; Tennessee Economic
and Community Development, About ThreeStar; Tennessee Economic and Community Development. TNECD
Marketing Assistance Program. State of Tennessee. 2022. https://tnecd.com/news/tnecd-launch-
es-round-two-of-marketing-assistance-program/
48 U.S. Census Bureau (2020). Employment Status, 2016-2020 American Community Survey 5-year estimates.
Retrieved from https://www.census.gov/newsroom/press-kits/2021/acs-5-year.html
49 Various stakeholder interviews (see Acknowledgements section). 2022.
50 Various stakeholder interviews (see Acknowledgements section). 2022.
51 Virginia Economic Development Partnership. Virginia Talent Accelerator Program. 2022. https://www.vedp.
org/incentive/virginia-talent-accelerator-program; Virginia Economic Development Partnership. Virginia Jobs
Investment Program (VJIP). 2022. https://www.vedp.org/incentive/virginia-jobs-investment-program-vjip
52 Northern Virginia Community College. G3 Initiative. 2022. https://www.nvcc.edu/g3/#panel10
53 Virginia Community College System. FastForward’s First Five Years. 2022.
54 Northern Virginia Community College, G3 Initiative.
55 Lightcast, Industry Data Download: Manufacturing Sector Employment (31-33) and Professional, Scientific,
and Technical Services Employment (54) in Study Region (162 Counties) (2022 - QCEW Employees and
Self-Employed) [Data Set], 2022, https://lightcast.io/
56 Ibid.
57 National Academies of Sciences, Engineering, and Medicine (NASEM). Building the Skilled Technical Work-
force. Washington, D.C.: National Academies Press. 2017. http://nap.nationalacademies.org/cata-
log/23472/building-americas-skilled-technical-workforce; National Center for Science and Engineering
Statistics (NCSES). Skilled Technical Workforce Initiative. Alexandria, VA: National Science Foundation. 2020.
https://www.nsf.gov/statistics/stw/skilled-technical-workforce.cfm
58 Commonwealth of Virginia. 2022 Special Session I Virginia Acts of Assembly, Item 487.50 #1c. 2022. https://
budget.lis.virginia.gov/amendment/2022/2/HB30/Introduced/CR/487.50/1c/
59 State Council of Higher Education for Virginia. Degrees awarded [dataset]. 2022. https://research.schev.edu/
info/Reports.Guide-to-the-Degrees-Awarded-Reports
60 GO TEC. GO Virginia Region 3 announces successful project award for GO TEC. 2019. https://www.gotecva.org/
go-virginia-region-3-announces-successful-project-award-go-tec/
61 Virginia TOP. Virginia Talent + Opportunity Partnership. 2022. https://virginiatop.org/; Commonwealth Innova-
tive Internship Fund and Program. State Council of Higher Education For Virginia. 2022. https://www.schev.
edu/institutions/grants/commonwealth-innovative-internship-fund-and-program; Advance CTE. Career
Clusters. 2022. https://careertech.org/career-clusters
62 Mountain Empire Community College. Center for Workforce and Innovation. 2022. https://www.mecc.edu/
center-for-workforce-innovation-of-appalachia/; Southern Virginia Higher Education Center. 2022. https://
www.svhec.org/
63 Johnson, Quentin R. Partnering with The Tobacco Commission. Southside Virginia Community College. 2022.
https://southside.edu/article/partnering-tobacco-commission
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64 Johnson, Steve. Virginia Lineworker Training School is a ‘Playground of Learning’. Rural Electric Magazine.
2016. https://www.cooperative.com/remagazine/articles/Pages/Virginia-Lineworker-Training-School-is-a-
Playground-of-Learning.aspx
65 U.S. Census Bureau (2010, 2011, 2012, 2013, 2014, 2015, 2016, 2017, 2018, 2019, 2020). Selected Housing
Characteristics, American Community Survey 5-year estimates. Retrieved from https://www.census.gov/
newsroom/press-kits/2021/acs-5-year.html
66 Ibid.
67 U.S. Census (2022). Construction Price Indexes. Retrieved from https://www.census.gov/construction/cpi/
68 Federal Housing Finance Agency. House Price Index. 2022. https://www.fhfa.gov/DataTools/Downloads/
Pages/House-Price-Index.aspx; Federal Housing Finance Agency. Housing Price Index County Map. 2021.
https://www.fhfa.gov/DataTools/Tools/Pages/HPI-County-Map.aspx
69 Virginia Housing. Economic and Programmatic Impacts of Virginia Housing. 2020. https://www.virginiahous-
ing.com/about/economic-impact
70 Joint Legislative Audit and Review Commission. Affordable Housing in Virginia. Commonwealth of Virginia.
2021. http://jlarc.virginia.gov/pdfs/reports/Rpt559-1.pdf
71 Shelton, Makayla. Danville Housing Summit encourages residential development in southern Virginia. WDBJ.
2022. https://www.wdbj7.com/2022/08/18/danville-housing-summit-encourages-residential-develop-
ment-southern-virginia/
72 Various stakeholder interviews (see Acknowledgements section). 2022.
73 Housing Choice Initiative. Housing Choice Communities Grant Program. Commonwealth of Massachusetts.
2021. https://www.mass.gov/doc/fy23-guidelines-for-housing-choice-community-grants/download
74 Nebraska Department of Economic Development. Rural Workforce Housing Fund (RWHF). State of Nebraska.
2022. https://opportunity.nebraska.gov/programs/housing/rwhf/
75 Virginia Association of Counties. Revitalization of historic school breathes new life into Carroll County. 2020.
https://www.vaco.org/county-connections/revitalization-of-historic-school-breathes-new-life-into-car-
roll-county/
76 Tupponce, Joan. White Mill project closer to getting off the ground. Virginia Business. 2022. https://www.
virginiabusiness.com/article/white-mill-project-closer-to-getting-off-the-ground/
77 Bipartisan Policy Center. Childcare in Rural America - What Have We Learned?. 2021. https://bipartisanpolicy.
org/download/?file=/wp-content/uploads/2021/10/Rural-Child-Care-Event-Slides-min.pdf
78 Smith, Linda, Morris, Suzann, Suenaga, Manami. Family Child Care: A Critical Resource to Rural Communities
during COVID-19. Bipartisan Policy Center. 2020. https://bipartisanpolicy.org/blog/family-child-care-a-criti-
cal-resource-to-rural-communities-during-covid-19/
79 Child Care Aware of Virginia. Child Care Data [dataset]. 2022. https://vachildcare.com/data-2/
80 U.S. Census Bureau (2020). Selected Economic Characteristics, American Community Survey 5-year estimates.
Retrieved from https://www.census.gov/newsroom/press-kits/2021/acs-5-year.html
81 U.S. Census Bureau (2019). All Sectors: County Business Patterns, including ZIP Code Business Patterns, by
Legal Form of Organization and Employment Size Class for the U.S., States, and Selected Geographies: 2019.
Retrieved from https://www.census.gov/data/developers/data-sets/cbp-nonemp-zbp/cbp-api.html; U.S.
Census Bureau (2020). Disability Characteristics, American Community Survey 5-year estimates. Retrieved from
https://www.census.gov/newsroom/press-kits/2021/acs-5-year.html
Southside-Southwest Virginia Barriers to Infrastructure and Supply Chain Investment | 2022 70
82 Haltom, Renee. Rural Spotlight: Advancing Early Childhood Education in Danville-Pittsylvania. Federal Reserve
Bank of Richmond. 2021. https://www.richmondfed.org/research/regional_economy/regional_mat-
ters/2021/rm_10_07_21_early_childhood
83 United Way of Southwest Virginia. United Way of Southwest Virginia Introduces Ready SWVA Workforce Devel-
opment Initiative. United Way. 2021. https://www.unitedwayswva.org/news/2021/12/08/unit-
ed-way-of-southwest-virginia-introduces-ready-swva-workforce-development-initiative
84 Sisk, Taylor. 100 Days in Appalachia. In Southwest Virginia, Reestablishing a Rural Hospital System Requires
Rebuilding Trust. 2021. https://www.100daysinappalachia.com/2021/07/in-southwest-virginia-establish-
ing-a-rural-hospital-system-requires-rebuilding-trust/
85 Smith et al., Family Child Care
86 NC Rural Center. NC Rural Center commends State Budget; thanks Legislators and Governor for rural wins and
highlights continued, critical needs for the future. 2021. https://www.ncruralcenter.org/2021/11/state-budget/
87 NC Department of Health and Human Services. Rural Health Centers Capital Grant. State of North Carolina.
2022. https://www.ncdhhs.gov/about/grant-opportunities/rural-health-grant-opportunities/rural-health-cen-
ters-capital-grant
88 Virginia Economic Development Partnership. Virginia Enterprise Zone – Job Creation Grant. 2022. https://
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89 Boothe, Investment in Wythe County.
90 Virginia Scan. 2022. https://sites.vedp.org/
91 Appalachian Regional Commission. ARC Projects Approved in Fiscal Year 2020. 2021. https://www.arc.gov/
wp-content/uploads/2021/04/FY20-Approved-Projects.pdf; Virginia Energy. Abandoned Mine Land Economic
Revitalization Projects. Commonwealth of Virginia. 2022. https://energy.virginia.gov/coal/mined-land-repur-
posing/AMLERProjects.shtml; Virginia Energy. Completed Abandoned Mine Land Economic Revitalization
Projects. Commonwealth of Virginia. 2022. https://energy.virginia.gov/coal/mined-land-repurposing/
AMLERComplete.shtml
92 Tobacco Region Revitalization Commission. Tobacco Region Revitalization Commission 2021 Annual Report.
2021. https://www.revitalizeva.org/wp-content/uploads/2022/01/TRRC_Report_2021_FINAL.pdf; Virginia
Coalfield Economic Development Authority, VCEDA Overview.
93 National Agriculture Statistics Service. Cash Rents County Estimates - 2022. U.S. Department of Agriculture.
2022. https://www.nass.usda.gov/Statistics_by_State/Virginia/Publications/County_Estimates/2022/
CR2022_VA.pdf
94 Virginia Economic Development Partnership. Site Characteriziation Initiative. 2019.
95 Virginia Department of Conservation and Recreation. Conservation Lands Database [Data Set]. 2022.
https://www.dcr.virginia.gov/natural-heritage/clinfo
96 Ibid.
97 Virginia Economic Development Partnership. Site Characteriziation Initiative. 2019.
Southside-Southwest Virginia Barriers to Infrastructure and Supply Chain Investment | 2022 71
98 Virginia Economic Development Partnership. Commonwealth’s Development Opportunity Fund (COF). 2022.
https://www.vedp.org/incentive/commonwealths-development-opportunity-fund-cof
99 Virginia Economic Development Partnership. VEDP Sites and Buildings Database. Commonwealth of Virginia.
2022. https://sites.vedp.org/
100 Commonwealth of Kentucky. 2022-2024 Budget of the Commonwealth. 2022. https://osbd.ky.gov/Publica-
tions/Documents/Budget%20Documents/2022-2024%20Budget%20of%20the%20Common-
wealth/2022-2024%20Budget%20of%20the%20Commonwealth%20-%20Volume%20I%20-%20Operating%20
Budget.pdf; Commonwealth of Virginia. 2022 Special Session I Virginia Acts of Assembly. 2022. https://
budget.lis.virginia.gov/get/budget/4623/HB30/; Commonwealth of Virginia. 2022 Special Session I. 2022.
https://budget.lis.virginia.gov/get/budget/4631/HB29/; North Carolina Office of State Budget and Manage-
ment. Office of State Budget and Management Certified Budget (2019, 2021); OneGeorgia Authority. OneGeorgia
Authority Annual Report (2019, 2020, 2021); Jobs Ohio. Ohio Site Inventory Program. State of Ohio. 2022.
https://www.jobsohio.com/programs-services/sites/ohio-site-inventory-program; Transparent Tennessee.
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view/open-ecd/openecd/tnecd-performance-metrics/openecd-rural-community-development-quick-stats/
site-development-grants.html
101 Virginia Economic Development Partnership. (FY21-FY25) Strategic Plan for Economic Development of The
Commonwealth of Virginia. 2021.
102 Virginia Economic Development Partnership. VEDP Sites and Buildings Database.
103 Arend, The 2022 Business Climate Rankings; Gamble, 18th Annual Consultants Survey.
104 Pipa, Anthony F., Geismar, Natalie, Reimagining rural policy: Organizing federal assistance to maximize rural
prosperity.
105 Bureau of the Fiscal Service. USASpending.gov [dataset]. U.S. Department of the Treasury. 2022. https://
www.usaspending.gov/
106 Conway Analytics, US Economic Development Projects (as of 10/05/2022) [Data Set], 2022; U.S. Census
Bureau's Master Address File / Topologically Integrated Geographic Encoding and Referencing (MAF/
TIGER) Database (MTDB), TIGER/Line Shapefile, 2019, nation, U.S., Primary Roads National Shapefile [Data
Set], 2019, https://catalog.data.gov/dataset/tiger-line-shapefile-2019-nation-u-s-primary-roads-national-
shapefile
107 Chmura Economics & Analytics. The Economic Impact of Interstate 73 on Virginia, West Virginia, and South
Carolina. Virginia Department of Transportation. 2014. https://www.virginiadot.org/projects/resources/
Salem/I-73/I-73_Economic_Impact_Presentation.pdf
108 Schmidt, Markus. $7 million for next Coalfields Expressway project moves closer. Cardinal News. 2022. https://
cardinalnews.org/2022/09/13/kaine-warner-secure-7-million-for-next-coalfields-expressway-project/;
Virginia Department of Transportation. About - Coalfields Expressway. 2019. https://www.virginiadot.org/
projects/bristol/about_coalfields_expressway.asp
109 Google. (n.d.). [Google Maps driving directions for various locations]. Retrieved 2022 from https://www.
google.com/maps
110 Virginia Department of Rail and Public Transportation. 2021 Bristol Extension Capital & Operating Cost
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111 Federal Railroad Administration. Southeast Rail Plan. 2020. https://www.southeastcorridor-commission.
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112 Virginia Department of Housing and Community Development. Virginia Telecommunications Initiative (VATI).
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Southside-Southwest Virginia Barriers to Infrastructure and Supply Chain Investment | 2022 72
113 Tobacco Region Revitalization Commission. Last-Mile Broadband Call for Proposals & Program Guidelines.
2018. https://www.revitalizeva.org/wp-content/uploads/2018/11/Last-Mile-Program-Guidelines-Nov2018.
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114 E-Region. $500,000 VCEDA Grant Approved for Space-Based Broadband Initiative. Virginia Coalfield Economic
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115 GO Virginia. FY22Q4 GOVA Project Awards Full Report. Virginia Department of Housing and Community
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116 King, Brendan. More Virginians need internet access than previously reported. WTVR News/CBS 6. 2022.
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117 New Grant Program Launched to Transform Rural Communities. North Carolina Department of Commerce.
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118 Tennessee Department of Economic and Community Development. Infrastructure Planning Grant. State of
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119 U.S. Department of Transportation. INFRA Awards FY22. 2022. https://www.transportation.gov/sites/dot.
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120 Schmidt, $7 million for next Coalfields Expressway project moves closer; Virginia Department of Transporta-
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Virginia Department of Transportation. U.S. Route 58 Corridor Development Program. 2019. https://virgin-
iadot.org/projects/Rt58-overview.asp
121 Commonwealth of Virginia. 2022 Special Session I Virginia Acts of Assembly, Item 125. 2022.. https://budget.
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122 Tax Foundation. 2023 State Business Tax Climate Index. 2022. https://taxfoundation.org/2023-state-busi-
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123 U.S. Energy Information Administration. Table 5.6.B. Average Price of Electricity to Ultimate Customers by
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124 Virginia Department of Planning and Budget. DEQ Operating plan for FY22. 2022. http://publicreports.dpb.
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125 Arend, The 2022 Business Climate Rankings; Gamble, 18th Annual Consultants Survey
126 South Carolina State House. Appropriations Section 34. 2022. https://www.scstatehouse.gov/
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Southside-Southwest Virginia Barriers to Infrastructure and Supply Chain Investment | 2022 73
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127 Virginia Department of Planning and Budget, DEQ Operating plan for FY22; Virginia Department of Environ-
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Published/2015/RD498
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- 91e55ecfb6dff3a51c3efb098f04356ca1c5d7f82f05f27ac5a3c1016e30783d
- Our copy
- 2023-HD4.pdf
- Original
- No public link identified.