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Tag: Southwest Virginia

Mining for talent

At the end of October, United Way of Southwest Virginia broke ground on its $25 million project to convert a former Kmart store in Abingdon into a regional workforce development and child care hub. It’s an attempt to address the region’s workforce shortage, one of the most pressing issues among area employers.

“There’s a lot of folks that aren’t participating in the labor force,” says Travis Staton, president and CEO of United Way of Southwest Virginia. “That means they’re not employed and they’re not working.”

Only about half of the region’s population participates in the workforce, leaving many local employers struggling to attract and hire employees. While Staton is still working to identify the many barriers contributing to this low participation rate, he and local employers are investing in new strategies, like bridging the gap between education and employment and providing affordable child care.

“You need to ask … why are they not participating in the labor force?” says Staton.

Southwest Virginia, which includes 16 cities and counties from Bland, Wythe and Carroll counties westward, was long defined by its natural resources, particularly coal. Like many of its Appalachian neighbors, the region’s economy has been historically tied to mining, and was ranked as the fourth most coal-dependent area in the U.S. in a 2021 report by the federal Interagency Working Group on Coal and Power Plant Communities and Economic Revitalization.

During the past three decades, Virginia’s coal production — the majority of which occurs in Buchanan, Dickenson and Wise counties — has fallen from 46.6 million tons in 1990 to less than 10 million in 2020, according to the Virginia Department of Energy.

Although mining jobs are down, other economic development projects bringing employment to the region have helped put Southwest Virginia ahead of the rest of the state in terms of post-pandemic job growth. One example is the temporary Bristol Casino, which is looking to more than double its workforce in the next year as the permanent Hard Rock Hotel & Casino Bristol opens.

“We currently have about 600 team members and, by next July, we look to have 1,300 to 1,400 team members,” says Marina Alvidrez, Hard Rock’s vice president of human resources for the Bristol casino.

Hard Rock is “looking for personality” and a good attitude in prospective employees — the casino will provide all other training, Alvidrez says. With pay rates starting at $18 an hour, she’s confident about attracting workers, but says other employers are finding they have to increase salary offerings and other benefits.

Hard Rock Hotel & Casino Bristol plans to hire a total of 1,300 to 1,400 workers for its $400 million permanent resort casino opening in summer 2024, says Marina Alvidrez, the casino’s vice president of human resources. Photo by Earl Neikirk

“When I hear a new company bringing in 250 jobs … I cringe,” says Lennie Gail Mitcham, executive director of The Southwest Virginia Alliance for Manufacturing. “We’ve got 380-something companies who can’t fill the job openings that they currently have.”

Mitcham’s organization works with 41 of the more than 350 manufacturing companies across Southwest Virginia. On SVAM’s website, alliance members are currently advertising 154 job listings, some of which are looking to hire more than one person for a particular job, Mitcham says.

Job hopping

Unemployment is higher in Southwest Virginia (3.9%, compared with 2.5% statewide) than other parts of the state, but the larger gap is in labor participation. Just over half of Southwest Virginians participate in the labor force — about 12% lower than the state average, according to the Virginia Employment Commission.

On top of nationwide labor trends, Southwest Virginia has unique workforce barriers, primarily including transportation, housing and child care, Staton says. In 2021, 40% of mothers of children under 6 in far Southwest Virginia were not in the labor force, compared with 26% statewide, according to data from the University of Virginia’s Weldon Cooper Center for Public Service.

Another challenge contributing to the region’s low workforce participation is public health. More than 25% of Southwest Virginians of working age report having a disability, and the seven localities with the highest disability rates for people ages 18 to 64 are in Southwest Virginia, says Hamilton Lombard, a Weldon Cooper Center demographer.

And while Southwest’s remoteness causes more than two-thirds of young adults to stay in the region, a better rate than other rural parts of Virginia, that same remote nature can be a barrier to attracting economic development, Lombard says. So, given the region’s job prospects, he says, “young adults in Southwest Virginia are less likely to be employed or in the labor force, helping depress participation rates further.”

What’s more, the region is not immune from national trends already making it difficult for companies to recruit and retain workers.

“We’re in this new dynamic of what the employer-employee relationship looks like,” says Glenn Goad, CEO of Atlanta-based internet provider EarthLink, which has a new office in Wise County. Goad, who says he’s faced difficulties hiring and keeping workers, believes many of the problems he faces are national trends brought about by the pandemic. “With COVID, we created this new world for employees called ‘flexibility.’”

Goad has struggled to adapt his company to the desires of incoming employees, particularly the younger generation, he says, leading to significant turnover. At the beginning of six-week training sessions at EarthLink’s Wise, Goad offers $500 to any new hire who will attend every day of the training.

“I’ve been doing this long enough, I know I won’t lose my $500,” he says, adding that a training class will typically start with about 20 new employees and often end with five or six.

Southwest Virginia has a turnover rate of about 8.3%, about six percentage points higher than state and national rates, according to U.S. Bureau of Labor Statistics data. Across the country, turnover rates are higher among younger generations, with Gen Z having some of the highest job-hopping rates of any generation, a 2022 Gallup poll shows.

Younger workers “are willing to job-hop for 50 cents an hour,” says Mitcham.

That difficulty in retention leads to an even greater labor shortage for mid- and high-skill jobs, as employers often prefer to hire employees from within who already have been trained and are familiar with the company, Mitcham says.

“They’re willing to hire individuals who show strong soft skills,” she says. “We need more soft skills. Employees are not understanding that they have to show up to work on time, they have to show up regularly. They’re not understanding a chain of command.”

Lennie Gail Mitcham is executive director for The Southwest Virginia Alliance for Manufacturing, which represents more than 350 area manufacturing businesses such as motion controls maker Columbus McKinnon’s plant in Damascus. Photo by Earl Neikirk

Barriers to work

High job vacancies aren’t the result of people not wanting to work or being lazy, says Staton, of United Way.

The region spans roughly 7,000 square miles, so people must often commute significant distances to find good-paying work, making reliable and affordable transportation a vital but somewhat lacking resource for local workers, Staton says.

Another area where Southwest Virginia is well behind the rest of the state is child care. Statewide, Virginia is about 12% short of needed child care slots, according to a 2019 study from the Bipartisan Policy Center, while Southwest Virginia has almost a 30% gap, meaning more than 7,000 children in the region don’t have child care or rely on a parent who stays at home.

“When you think about a lot of people sitting on the sidelines, if you don’t have child care … especially [for] young professionals and young families, there’s typically somebody sitting at the house not in the labor force and the other person is going to work,” Staton says.

Many parents feel they are dedicating so much of their paycheck to child care that it’s more valuable to stay with their child and ensure quality care, he adds. The average annual cost of child care for an infant in Virginia is more than $14,000, making Virginia the ninth most expensive state for child care in the country, according to a June report from the Economic Policy Institute.

That means child care costs for Southwest Virginians with a single child could be a third of their annual income, which averages $45,340 for the region, per the Bureau of Labor Statistics.

In a survey of 150 businesses, United Way of Southwest Virginia found more than half of those employers said the need for child care was impacting their ability to hire and retain talent, says Staton. One of those companies is Abingdon-based K-VA-T Food Stores, operator of the Food City supermarket chain that’s the second largest employer in Southwest Virginia.

“We, along with other employers, have been very frustrated about not being able to get people back into the workforce,” K-VA-T President and CEO Steve Smith says. “Time and time again, child care comes up as a big opportunity.”

Addressing the problem

Food City has experienced worker shortages on the retail and corporate sides of the business, Smith says, which is why the company is partnering with United Way and donating $4 million to help establish United Way’s regional workforce and child care hub under construction in Abingdon. 

Funded through a mix of public and private funds, including federal funding from the American Rescue Plan Act, the planned 87,000-square-foot facility will dedicate about a third of its space to providing child care for about 300 children, ages 5 and under. The rest of the space will be dedicated to serving students from kindergarten through high school, offering educational resources and opportunities for kids to explore career options as they get older, with a goal of reaching 30,000 students per year at full capacity, to Staton. It will include a GO TEC lab with 3D printers and robotics and other technologies for K-12 teachers, as well as a workforce exploration center.

“We like to think we’re working on both sides of the continuum right now,” says Staton. “Historically, [we] have a lot of disconnect and opportunity to bridge the gap between the world of learning, which would be the educational system, to the world of work.”

Adding internships and training programs for students is a popular strategy among employers addressing labor shortages, including CGI, an IT consulting firm with more than 375 employees in Lebanon.

The average CGI worker spends nine years at the company, with turnover rates roughly half the industry standard, according to Luke Layne, director of CGI’s Lebanon onshore delivery center. The company, which came to the region in 2006, has become well known locally, Layne says, for its work with students, including sponsoring a STEM camp for local middle schoolers and participating in a career expo through United Way that puts CGI’s name in front of 4,000 seventh-graders — essentially every student of that age in the region.

Mitcham, too, believes investing in student outreach is key, especially since she says she finds students aren’t aware of or have misconceptions about manufacturing jobs in the region. Manufacturers are increasing internship opportunities and partnering with vocational and higher education schools like Mountain Empire Community College and the University of Virginia’s College at Wise to spread awareness about manufacturing, as well as cultivate highly sought soft skills.

In terms of retaining young people who may be prone to job hopping, it’s a matter of showing them “a roadmap” to advancement and an appealing future with a particular company, Mitcham says.

“A lot of Gen Z are more willing to stay if you provide them with a good work environment,” she says. “The data says that you can wave a dollar at me, but if you don’t provide me with a work environment that I’m going to enjoy or have no opportunities for advancement, I’m going to stay where I’m at.”

Some companies increased hourly pay from around $10 to $16 since the pandemic began, Mitcham says. Layne, at CGI, also believes his company’s salaries have helped attract and retain workers. CGI starts employees about $5,000 higher than the region’s annual salary on average, according to employment website Indeed.

More so than salaries, says Goad, at Earthlink, flexible work schedules and an appealing work environment seem to be top priorities among younger employees, and he is even considering a four-day workweek for some corporate positions.

As EarthLink wraps up construction on a new 30,000-square-foot office in Wise County, employee demands are top of mind for Goad, who is making sure large break rooms and common areas are included in the design.

“If you just go back 10 years ago, nobody was spending extra money to build that into a building that’s supposed to be built to be efficient,” he says. “As an employer, we’re now challenged with how we figure out how to fit into this new paradigm.”  

The Birthplace of Country Music Museum Photo courtesy The Birthplace of Country Music Museum

Southwest Virginia at a glance

Located within a day’s drive of six capital cities, the southwestern tip of Virginia is known for its mountainous natural beauty, as well as a history of coal mining and cultural richness. It includes Bland, Buchanan,Carroll, Dickenson, Grayson, Lee, Russell, Scott, Smyth, Tazewell, Washington and Wythe counties, as well as the cities of Bristol, Galax and Norton. While coal mining and other natural resource extraction have long dominated the region’s economy, other industries have grown up in recent years, including customer support centers. Tourism has also grown in Southwest Virginia, thanks to the region’s rich history of Appalachian music, crafts and outdoor recreation. It is also home to Mountain Empire Community College and the University of Virginia’s College at Wise.

Population

366,695

Top employers

  • Walmart 
  • Food City
  • Lee, Russell, Scott, Tazewell and Wise county school systems
  • Foundever (formerly Sitel)
  • Paramont Coal Company Virginia

Select hotels

The Sessions Hotel (Bristol)
70 guest rooms, 2,311 square feet of event space

The Bristol Hotel (Bristol)
65 rooms, 3,800 square feet of event space

The Martha Washington Inn & Spa (Abingdon)
63 rooms, 3,200 square feet of event space

The Inn at Wise (Wise)
49 rooms, 5,000 square feet of event space

Western Front Hotel (St. Paul)
30 rooms, 2,000 square feet of indoor and outdoor event space

Nicewonder Farm & Vineyards (Bristol)
28 rooms, 44,000 square feet of indoor event space

Restaurants

Burger Bar (Bristol) American, theoriginalburgerbar.com

Gillie’s Restaurant (Blacksburg) Vegetarian, gilliesrestaurant.com

Draper Mercantile and Trading Company (Draper) American, draperisfordreamers.com

The Tavern (Abingdon) American, abingdontavern.net

Eatz on Moore Street (Bristol) American, eatzonmoorestreet.com

Major attractions

Southwest Virginia is home to a 300-mile music heritage trail known as The Crooked Road, which honors its contribution to gospel, blues and bluegrass, as well as The Birthplace of Country Music Museum in Bristol. The Appalachian Trail also runs through the middle of the region, with a hiker hub and Trail Center in the town of Damascus, which hosts the Appalachian Trail Days Festival with up to 20,000 attendees annually. Grayson Highlands State Park’s wild ponies in Mouth of Wilson and Natural Tunnel State Park’s massive caves in Scott County are some of the natural splendors that attract visitors, as well.

Clean energy development could draw $8.5B in investments

Wise County and neighboring localities may become home to a massive clean energy development that could attract up to $8.25 billion in capital investments, Gov. Glenn Youngkin announced Nov. 1.

An agreement between Wise County, the Energy DELTA Lab and Dallas-based Fortune 100 energy company Energy Transfer aims to develop 65,000 acres of former coal mining property into a hub for generating power from a variety of sources — including wind, solar, pumped storage hydropower, nuclear, natural gas and hydrogen — as well as energy storage. That “all-of-the-above” approach is in alignment with the Youngkin-backed Virginia Energy Plan, which aims to fulfill the Virginia Clean Economy Act’s renewable power mandates through a mix of energy sources beyond wind and solar.

The 2022 Virginia Energy Plan launched the nonprofit Energy DELTA Lab, which will be the primary developer of the Southwest project. More than a dozen projects are under consideration — they total $8.25 billion in potential private capital investment, according to the governor’s office, and could create 1,650 jobs and generate nearly 1 gigawatt of power.

Energy Transfer owns the 65,000 acres, which is primarily in Wise County, while Penn Virginia Operating Co. manages the land. Neighboring Lee, Scott and Dickenson counties and the city of Norton also could see related development, as the DELTA Lab conducts due diligence on several projects.

“The commonwealth’s power demand is skyrocketing, and now is the time to make strategic investments in energy infrastructure to meet our growing needs,” Youngkin said in a statement. “This agreement will make Virginia energy more reliable, affordable and clean while transforming Southwest Virginia into a
hub for innovation.”

The DELTA Lab is developing three industrial sites in Wise County, including on land owned by Energy Transfer:

  • The Nature Conservancy and Sun Tribe Solar are locating a solar farm on the 300-acre “Meade Fork” site near Pound;
  • A mixed-use development project, including an industrial clean energy component, will be built on the 2,000-acre “Junction” site near Appalachia;
  • The team will convert a 400-acre prev-iously mined property into a 1-gigawatt, multitenant data center campus on the 4,000-acre “Bullitt” site on the border with Lee County, which can hold multiple industrial projects with adjacent energy sites to power on-site demand.

“This is opening up land that otherwise would not be developed,” said Will Payne, managing partner of Coalfield Strategies and director of InvestSWVA.

A longer version of this story ran online on Nov. 1.

SWVA clean energy development could draw $8.5B in investments

Wise County and neighboring localities in Southwest Virginia may become home to a massive clean energy development that could attract up to $8.25 billion in capital investments, Gov. Glenn Youngkin announced Wednesday.

An agreement between Energy DELTA Lab, Dallas-based Fortune 100 energy company Energy Transfer and Wise County will involve the development of 65,000 acres of former coal mining land for “all-of-the-above” energy technology — including natural gas, nuclear, renewable energy and other emerging energy sources. That’s in alignment with the Youngkin-supported Virginia Energy Plan, which aims to fulfill the Virginia Clean Economy Act’s mandates by including a mix of energy sources beyond wind, solar and battery storage supported by Virginia Democrats.

The 2022 Virginia Energy Plan launched the nonprofit Energy DELTA Lab, which will be the primary developer of the Southwest project, and more than a dozen projects are under consideration for the land — they total $8.25 billion in potential private capital investment, according to the governor’s office, and could create 1,650 jobs and generate nearly 1 gigawatt of power. By contrast, Dominion Energy’s Coastal Virginia Offshore Wind project is expected to produce 2.6 gigawatts of power.

Energy Transfer owns the 65,000 acres, which is primarily in Wise County, and owns surface and subsurface rights, while Penn Virginia Operating Co. manages Energy Transfer’s land. Neighboring Lee, Scott and Dickenson counties and the city of Norton also could see development and have projects undergoing due diligence with the DELTA Lab.

Development could include wind, solar, nuclear, hydrogen and pumped storage hydro, as well as energy storage technologies.

“The commonwealth’s power demand is skyrocketing, and now is the time to make strategic investments in energy infrastructure to meet our growing needs,” Youngkin said in a statement. “This agreement will make Virginia energy more reliable, affordable and clean while transforming Southwest Virginia into a hub for innovation.”

The partnership plans to develop energy projects at scale, with its primary goals being creating jobs and local tax revenues. Other goals include creating career pathways for the regional workforce and manufacturing opportunities.

Readying industrial land

The Energy DELTA Lab is currently developing three industrial sites in Wise County, including on land owned by Energy Transfer: the 300-acre “Meade Fork” site, the 2,000-acre “Junction” site and the 4,000-acre “Bullitt” site.

The Meade Fork site is located near the town of Pound, and the Energy DELTA Lab is working with The Nature Conservancy and Sun Tribe Solar to locate a solar energy facility on it. The project received a $975,000 grant from the U.S. Office of Surface Mining Reclamation and Enforcement’s Abandoned Mine Land Economic Revitalization program, administered by the Virginia Department of Energy.

The Junction site, located near the town of Appalachia, will be a mixed-use development pilot combining four land uses on multiple sites of a singular property, including industrial, clean energy generation, agriculture and conservation uses. The initial focus is developing a 350-acre industrial site for a clean energy project.

The Bullitt site on the border of Lee County could hold multiple industrial projects with adjacent energy sites to power on-site demand, and the complex is situated over abandoned mines that contain nearly 10 billion gallons of water.

The team will develop the Data Center Ridge site on the Bullitt site, converting a 400-acre previously mined property to a 1-gigawatt, multitenant data center campus that will use the planned adjacent clean energy developments.

The lab’s “Oasis Mine-Based Water Cooling System,” an HVAC closed-loop water cooling system that uses water below 55 degrees Fahrenheit in underground mine cavities, can reduce energy requirements and costs for data center cooling. Data Center Ridge has a single deposit of nearly 10 billion gallons of naturally replenishing cold water.

The data center model is based on a 36-megawatt facility that would be owned and operated by the company it supports, such as Amazon Web Services, Alphabet or Microsoft. The 250,000-square-foot model has a raised floor space of 150,000 square feet to house IT equipment and servers, with remaining building space holding office space, telecom equipment, electrical/mechanical rooms, shipping/receiving areas and security.

For Wise County, one 36-megawatt facility is estimated to create $15.7 million in real estate and property tax revenues over the first five years of operation, support 2,048 jobs during the 18-month construction period, and create 40 data center jobs and support 59 additional jobs once data center operations begin, according to a Mangum Economics analysis.

“This is opening up land that otherwise would not be developed,” said Will Payne, managing partner of Coalfield Strategies, director of InvestSWVA and adviser to the Energy DELTA Lab. “That’s a huge game changer for them and their own development and the surrounding area.”

Energy Transfer is the largest operator of natural gas pipelines in the U.S. by revenue, according to Fortune, and reported $89.9 billion in 2022 revenue.

Energy DELTA (Discovery, Education, Learning and Technology Accelerator) Lab is a 501(c)3 nonprofit focused on deploying new and clean energy technologies to diversify Southwest Virginia’s economy and provide energy companies speed to market with testing and project development. The lab is a collaborative effort of energy industry companies, electric utilities, business development initiative InvestSWVA, Southwest Virginia Energy Research and Development Authority and the Virginia Department of Energy.

EarthLink support center approaches completion

By mid-August, construction workers had gotten up a big portion of the steel framework for the 28,000-square-foot, two-story building that will house EarthLink’s customer support center at Project Intersection, a new business and industrial park in Norton.

Employees of the Atlanta-based high-speed internet service provider should be able to move into the building by March 2024, says Duane Miller, executive director of the LENOWISCO Planning District.

In late 2019, when EarthLink executives and Southwest Virginia officials began discussing building a customer support center for the company in the region, the project cost was projected to be $5.4 million. 

“After COVID, the cost of the building is closer to $11 million,” Miller says.

EarthLink will lease the building from the Lonesome Pine Regional Industrial Facilities Authority, a multijurisdictional organization. 

The company has operated out of a temporary facility in the Lonesome Pine Regional Business & Technology Park in Wise County since early 2022, according to Jonathan Belcher, executive director of the Virginia Coalfield Economic Development Authority.

So far, EarthLink has hired about 50 employees who take inbound sales calls and offer customer support, says EarthLink CEO Glenn Goad. He hopes to have hired 100 employees by the time the new building is ready; however, recruiting workers has been more challenging than expected. “The one thing I was surprised at is [the difficulty in] getting people to show up for interviews and/or jobs and stay in [those jobs],” says Goad.

Nevertheless, Goad, a Florida native who grew up witnessing the region’s strong work ethic firsthand during childhood visits to his father’s family in Wise County, feels confident EarthLink will be able to find the right employees given additional time. He predicts the call center will eventually house between 250 and 285 workers.

On June 30, EarthLink acquired Texas-based voice and data services provider One Ring Networks. Eventually, the Norton center will also house employees who offer support to those business customers, Goad says.

Before agreeing to the deal bringing a call center to Norton, EarthLink executives stressed the building would need to be completed within a 24-month period. That period ends in October.

Considering that the builders faced a steel shortage and supply chain hurdles, Miller is proud that the building will likely be ready by March, even though they missed the target by a few months.   

Satellite internet improves mobile health care

The Health Wagon got its start in 1980 when Sister Bernadette Kenny, a nurse practitioner, began dispensing free, much-needed health care to people in rural Appalachia from her Volkswagen Beetle.  

“She was thinking outside the box,” says Health Wagon President and CEO Teresa Tyson.

Kenny served as inspiration, Tyson says, when the health care provider’s leaders decided to switch to satellite internet service through SpaceX’s Starlink. The Elon Musk-owned service brings the web to hard-to-reach places via its constellation of low-Earth-orbiting satellites. For two years of service and hardware, Starlink internet will cost the Health Wagon $18,050, which has been covered through donations, Tyson says. 

The Health Wagon operates multiple mobile clinics that regularly visit 13 sites in Buchanan, Dickenson, Lee, Russell, Scott and Wise counties. The nonprofit also operates two stationary medical clinics, in Wise and Clintwood, and a dental clinic in Wise.

Previously, the mobile clinic’s health care workers relied on cellular hotspots that weren’t always reliable. “It’s just not ideal, especially if there’s more than two people using it,” says Bo Cash, IT system administrator for the Health Wagon. 

Three of the mobile clinic’s stops — all in Dickenson County — lacked cell service. That meant patients at those stops couldn’t access telehealth visits with specialists, and Health Wagon workers were “out there kind of blind without being able to look at electronic health records” to view patient medical histories and prescriptions, Tyson says. 

That is changing with Starlink, which also allows Health Wagon workers to use tools like a retina camera that can send images to UVA Health in real time. “Now, we can take that camera out on the road with us and do these retinal screenings for eye disease,” Tyson says.

In addition to extending internet access, Cash and Tyson feel confident Starlink will offer faster and more dependable service than the cellular hotspots. “It’s going to [produce] improved patient outcomes and that translates into improved health care and saved lives,” says Tyson. 

Dr. Joseph Aloi, Wake Forest Baptist Health’s section chief for endocrinology and metabolism, has volunteered with the Health Wagon for about two decades. With satellite internet, he’s hopeful the staff will have an easier time sending him patient data and that patients will have smoother telehealth visits.

“It’ll just minimize hiccups,” he says.  

Virginia Business Associate Editor Katherine Schulte contributed to this story.

Startup competition expands to SWVA

Rural communities need extra love when it comes to additional business resources, says Kathy Deacon, vice president of business and resource development for the Vinton-based Advancement Foundation.

The foundation has been running “The Gauntlet,” a business program and pitch competition, since 2015, expanding it into Southwest Virginia this year.

Since the program is run online, it has had participants from all over the country, as well as overseas, Deacon says. While the class portion is online, it also hosts in-person stakeholder meetings and networking events.

The competition’s expanded region adds all counties from Buchanan down to Lee, across to Henry and up to Rockbridge.

“We want to uncover entrepreneurs in areas that are typically underserved. Our focus really is on rural community developments that aren’t typically in line to get lots of additional resources either at the state or the federal circles,” Deacon says.

The program provides entrepreneurs who are looking to start new businesses or expand existing ones with 10 weeks of business planning and development classes, including marketing, e-commerce and financial planning — beginning in February, with an awards ceremony in May. At the end, they turn in a business plan that is judged by a panel, and the highest ranked entrepreneurs compete in a pitch competition.

Each year, the Gauntlet program provides more than $300,000 in cash and in-kind services, including consultations with attorneys, accountants and marketing professionals, as well as website development. A general prize pool is applied to the participants based on business plan and pitch competition judging.

This year, over 100 entrepreneurs participated.

The program helped 2023 participant Dirk Moore, owner of Blue Hills Natural Food Market in Abingdon, find support in expanding into a new location. “I think whenever you have business owners who are working together, especially when they’re in proximity with one another, you learn how important it is for everybody to succeed and for your business ecosystem to do well, and that is really reinforced by the Gauntlet program,” Moore says. 

Some program participants go on to make moves nationally — like Richard Mansell, a 2019 participant from Covington whose company, IVO Ltd., is valued at $10 million — but most have small Main Street businesses that are succeeding locally, Deacon says: “Once you’ve got a thriving downtown, the growth continues, and it’s creating jobs and opportunities for families to thrive.” 

SWVA ‘ideal’ for small nuclear reactors, study says

Sites in Dickenson, Lee, Scott and Wise counties and the city of Norton would be “ideal” for installing small modular nuclear reactors (SMRs), according to a state-funded feasibility study released Monday.

Examining the technical feasibility, safety considerations and economic viability of locating small reactors in Southwest Virginia, the study conducted by Reston-based Dominion Engineering Inc. deemed Southwest Virginia a “competitive hosting ground for SMRs.”

The region is “in a prime position to attract new industries with inexpensive brownfield sites, mine water for cooling, existing right of way to transmission infrastructure and existing rail infrastructure,” according to the $150,000 study, which was commissioned by the LENOWISCO Planning District Commission and funded by the Virginia Department of Energy and GO Virginia Region One. 

“The main takeaway,” said Dominion Engineering President Mike Little, “is that this community is extremely attractive for one of these facilities. It’s not just one … factor that makes it attractive. It’s broadly distributed across all of those categories. … There’s existing infrastructure here.”

The state-funded study bolsters Virginia Gov. Glenn Youngkin’s push for nuclear energy to be part of the state’s green energy framework, the Virginia Clean Economy Act, which was passed by the General Assembly in 2020. In October 2022, Youngkin announced a goal of bringing a small nuclear reactor to Southwest Virginia within 10 years — despite the fact that the only currently operational SMR is in Russia. The idea of nuclear energy being a bridge between fossil fuels and renewable solar and wind energy sources has support from both Republicans and Democrats.

Last fall, Youngkin proposed allocating $10 million to create the Virginia Power Innovation Fund, with $5 million going toward the development of an SMR, but the legislature isn’t completely on board. A bill to establish a small nuclear reactor pilot program failed in the General Assembly this session, but nuclear energy is still a hot topic among state energy stakeholders.

“The study affirms the governor’s initiative to deploy SMRs in Southwest Virginia and their advantage in the region,” Youngkin’s spokeswoman, Macaulay Porter, said this week. “As the governor has said, the Southwest has a talented, generational energy workforce, a best-in-class training pipeline through local colleges and community colleges, and a unique geography that makes it among the best locations for research and development of advanced nuclear technologies.”

The seven potential SMR sites identified by the study are: 

  • Bullitt Mine Complex, Wise County
  • Vacant limestone mine, Scott County
  • Abandoned mine land site, Lee County near Wise County border
  • Mineral Gap/Lonesome Pine Regional Business and Technology Park, Wise County
  • Project Intersection (188-acre surface coal mine site at U.S. 23 and U.S. Alt 58), Norton
  • Red Onion Industrial Park, Dickenson County
  • Virginia City Hybrid Energy Center power station, St. Paul

In a statement Monday, Virginia House Majority Leader Terry Kilgore, R-Gate City, called the site and feasibility study “the next step in making Gov. Youngkin’s ‘moonshot’ goal of making Southwest Virginia the home of the nation’s first SMR within 10 years a reality.” 

The two major utilities providing power in Virginia — Richmond-based Dominion Energy Inc. and American Electric Power Inc. (AEP) — have expressed support for developing nuclear projects in the region, according to the study. In a plan released in January, Dominion stated that it “anticipates SMRs could be a feasible supply-side resource as soon as the 2030s.”

At least 70 commercial SMRs are in various stages of development worldwide, but only one in Russia is operational. In the United States, the U.S. Nuclear Regulatory Commission approved just one SMR design, from Oregon-based NuScale Power Corp., in summer 2022.

SMRs are designed to generate up to 300 megawatts per unit, about one-third of the capacity of conventional nuclear reactors, such as the North Anna and Surry power stations owned by Dominion Energy Inc. in Virginia, which power nearly 900,000 homes.

Supporters see SMRs as a solution to climate change because they don’t emit greenhouse gases, unlike gas- and coal-fueled power plants. And unlike wind or solar energy, nuclear reactors aren’t dependent on the elements and don’t require battery storage. However, critics say that large nuclear plants are too expensive to build and maintain, and it will take too long for SMRs to address climate change, as well as prompting safety concerns about radioactive waste and accidents.

A May 2022 study led by a Stanford University scientist published in the Proceedings of the National Academy of Sciences found that SMRs would likely create more nuclear waste — by a factor of up to 30 — than conventional reactors. However, a second study released in November 2022 by the Argonne and Idaho national labs said the amount of nuclear waste produced by SMRs would be about the same as waste produced by large light water reactors. 

Virginia’s study on the viability of Southwest Virginia as a future home for SMRs “gives us third-party validation that Southwest Virginia is in the running, based on the land attributes necessary for deployment of SMRs,” said Will Payne, managing partner of consulting firm Coalfield Strategies LLC and head of business development for InvestSWVA, a regional business attraction campaign that focuses on adapted reuses for abandoned mine land.

“Southwest Virginia has and always will be an energy community,” Payne said, “and we believe that our land position makes us more competitive than other energy communities around the country.”

The primary reason many Southwest Virginia stakeholders are keen on SMRs is the economic impact such a project could have on the region. With the decline of coal mining jobs in Appalachia, the Southwest region has lost good-paying jobs and seen its population numbers decrease as a result.  

“It’s fair to say deploying one SMR will absolutely transform this region’s economy because of the significant capital investment,” Payne said. 

A 300-megawatt SMR would be expected to require a capital expenditure of about $1 billion, creating 40 to 60 permanent jobs and hundreds of temporary construction jobs, according to the study, and would provide more than $100 million in new local tax revenue over about 20 years. However, the report also confirmed that it could take 10 years for the first SMR to be operational in the region.

“We are thrilled to have completed this study, which holds great promise for transforming the energy landscape not only in Southwest Virginia but throughout the commonwealth of Virginia,” LENOWISCO executive director Duane Miller said in a statement. “Small modular reactors have the potential to provide a source of safe, stable and sustainable energy, enabling transformational economic growth, improving quality of life and complementing the region’s existing energy generating portfolio.” 

Filling in

Industrial real estate is a hot commodity in Southwest Virginia.

“It’s hard to find available space of anything that’s above 15,000 to 20,000 square feet,” says Jonathan Belcher, executive director of the Virginia Coalfield Economic Development Authority (VCEDA), which represents Lee, Wise, Scott, Buchanan, Russell, Tazewell and Dickenson counties and the city of Norton.

Leaders in the area had discussed putting up industrial spec buildings — structures erected with a goal of attracting tenants after construction. But then inflation hit. “It’s just become so cost-prohibitive,” Belcher says. Until prices go down, he and other Southwest Virginia economic development leaders have had to look “more closely at what existing inventory there is in an area.”

New Jersey-based custom resin and vinyl fabric manufacturer Ronald Mark Associates Inc. (RMA) looked to existing inventory for its new Virginia manufacturing operation. In November 2022, RMA announced plans to invest $13.5 million to establish a manufacturing operation at the former Komatsu plant in Bluefield.

Executives at Komatsu, a manufacturer of construction, mining, forestry and industrial heavy equipment, announced in January 2021 their plans to close the Bluefield facility, which produced underground mining products. According to news reports, 120 workers lost their jobs.

In late January, RMA President Michael Satz said he had just hired a production manager who would help him hire 28 more employees. “If Komatsu had over 120 people on staff, hopefully we can find some of those people and bring them back.”

Manufacturing and shipping

In another example of repurposing existing buildings, Signco, a Chicago-based custom sign manufacturer, announced plans in March 2022 to invest $650,000 to establish operations at the former MC Signs facility in Bluefield. Timothy Danielson, director of economic development for Tazewell County, said the company had 21 employees working at the Bluefield operation by early December 2022. “It’s another great addition to the manufacturing base in the area,” Belcher says.

Chilhowie also had big manufacturing news last year.

In June 2022, Illinois-based Scholle IPN, a flexible packaging supplier, announced plans to invest $31.1 million to expand its operation in the Smyth County town by 73,000 square feet to accommodate new manufacturing lines. The company also plans to add 800 feet of new rail track to support the inflow of resin.

Kendra Hayden, economic development project manager for Smyth County, said in early December 2022 that the company had laid a concrete pad for the expansion. 

Construction should be completed by late summer or early fall, according to Jake Tabor, business retention and expansion manager for the Mount Rogers Regional Partnership, a nonprofit regional economic development organization.

In Washington County, construction is underway on a 251,000-square-foot distribution center for FedEx Ground. The facility is expected to create 250 jobs, according to Jason Boswell, director of community development for the county.

The warehouse is expected to be operational in 2023, a spokesperson for FedEx said in a statement to Virginia Business.

Tech talent

Southwest Virginia also attracted technology employers in 2022.

In August 2022, Paymerang LLC, a Chesterfield County-based payment and invoice automation company, announced plans to create 50 jobs in software development, payment operations and cloud engineering in Wise County. The new positions will be housed in Big Stone Gap’s downtown coworking space.

As of early December 2022, the company had hired about a dozen of the new employees, according to Will Payne, managing partner of consulting firm Coalfield Strategies LLC, which leads business development for InvestSWVA, a public-private business attraction and marketing campaign for Southwest Virginia that assisted with Paymerang’s move to Wise County.

In October 2022, two Tazewell County residents announced plans to locate a data center hosting and cryptocurrency mining business called Blackstone Data Services LLC at the county’s Bluestone Business and Technology Park.

“We think it will be successful,” Tazewell County Administrator Eric Young says of the project. “Hopefully other data centers will come out into rural areas.”

Co-founders Seth White and Craig Earls have installed two mobile data centers at the park. These centers house technology used for bitcoin mining, a process where high-performance computers solve math equations to validate bitcoin transactions.

White and Earls are working with Appalachian Power and county officials in the hopes of increasing the amount of power available at the technology park. As of December 2022, Blackstone Data Services had 1.5 megawatts of power available to use, according to Earls. Ideally, they’d like access to 10 to 12 megawatts. That will likely require a substation to be built, he says.

“We’re a small company right now,” adds White. “We’ve got aspirations to grow beyond that — assuming we can get more power.” 

 

United Way of SWVA appoints development/outreach VP

The United Way of Southwest Virginia has named Beth McConkey as its new vice president of development and outreach, the organization announced Thursday.

McConkey oversees the marketing and communications and development teams. She started her role in mid-December.

She brings 16 years of marketing experience to the organization and has held leadership positions at multiple organizations. Most recently, she was vice president of marketing and communication for Community First Foundation and before that served as assistant director of marketing and communications at Regis University in Colorado, according to her LinkedIn profile.

“We are so excited to have Beth be a part of our team,” UWSWVA President and CEO Travis Staton said in a statement. “As our organization continues its growth, Beth’s vast experience and expertise position us for continued success in the present and future.”

 

Southwest Virginia could get small modular nuclear reactor

In early October, Gov. Glenn Youngkin announced his goal of developing a small modular nuclear reactor (SMR) in Southwest Virginia within 10 years, part of a plan to make the region an epicenter of energy innovation.

Not long after, Youngkin said he planned to allocate $10 million to create the Virginia Power Innovation Fund, with $5 million going toward development of the proposed SMR.

An emerging technology, SMRs are being designed to generate up to 300 megawatts per unit, about one-third of the capacity of conventional nuclear reactors. Supporters see SMRs as a solution to the climate crisis because they don’t emit greenhouse gases. Unlike wind or solar energy, nuclear reactors aren’t dependent on the elements and don’t require battery storage, but critics have safety concerns.

Doug Lawrence, vice president of nuclear operations and fleet performance for Dominion Energy Inc., describes SMR as a “clean, reliable source of energy that is always on and not dependent on weather conditions.”  

There are more than 70 commercial SMRs in development worldwide, but only one in Russia is operational. The U.S. Nuclear Regulatory Commission approved an SMR design from Oregon-based NuScale Power Corp. in summer 2022.

In a 2022 update to Dominion’s integrated resource plan, the utility said it could add an SMR to its fleet by 2032, with the potential to build one 285-megawatt SMR each year after that. 

Critics of the technology claim SMRs are not cost effective and express concern about radioactive waste that could be generated by SMRs, as well as the danger of nuclear accidents. A 2022 study published in the Proceedings of the National Academy of Sciences found that SMRs would likely create more nuclear waste, by a factor of up to 30, than conventional reactors.

Nevertheless, this isn’t a case of Richmond lawmakers trying to dump dangerous but needed technology in a rural part of the state, says Will Payne, director of economic development initiative InvestSWVA. “There are … other regions that want to have SMRs throughout Virginia,” Payne says. “It’s highly competitive.”

It’s too early to know how many jobs an SMR could create or the economic impact a small reactor could have on Southwest Virginia, says Duane Miller, executive director of the LENOWISCO Planning District Commission.

By spring, Miller hopes to have a needs assessment explaining what SMR developers seek in a site location. The next step, he says, would be to identify sites in the region that meet those criteria