The Trump administration’s proposal to slash Appalachian Regional Commission (ARC) funding by 93% — from over $200 million to just $14 million — threatens to sever one of Southwest Virginia’s most vital economic arteries. This drastic cut would devastate a region where 19 counties depend on ARC investments for everything from water systems to workforce training, just as the coalfields begin their most promising transformation in decades.
Virginia’s congressional delegation fought off a similar Trump proposal in 2018, with Sen. Mark Warner and Tim Kaine joining their Appalachian colleagues to preserve full ARC funding. Now they face the same battle again, with even higher stakes for a region that has received more than $17 million in ARC investments in fiscal year 2024 alone matched by $51.5 million in Virginia funds.
A personal journey through ARC’s Virginia story
When I joined ARC in 1969, I was one of only three regional natives at an agency dominated by outsiders transferred from the Department of Commerce. The 1964 President’s ARC Report, commissioned by President John F. Kennedy and chaired by James Roosevelt, FDR’s son, famously called Appalachia “an island of poverty in a sea of affluence.” That phrase, rooted in the stark realities of Central Appalachia’s coalfields, included the mountain counties of Southwest Virginia.
The agency’s creation came through the tireless advocacy of John Whisman of Hazard, Kentucky — a remarkable Jaycee who sold inflatable buildings for a living and convinced 13 governors to back a joint state/federal agency. Kentucky Gov. Bert Combs was the first to embrace Whisman’s vision, and Virginia Gov. Mills Godwin Jr. soon joined the coalition, recognizing that Southwest Virginia’s coal counties shared the same economic struggles as their neighbors in Kentucky and West Virginia. Whisman once told me the genius of the Appalachian Regional Commission was that it “bribed” governors to focus on their most neglected citizens.
The political geography that resulted was complex. While Rep. Richard Poff of Roanoke opposed ARC’s creation — leaving Roanoke outside the region — cities like Pittsburgh, Birmingham and Knoxville were included. New York state became a designated part of the ARC territory because of the advocacy of Sen. Robert Kennedy. Northern Mississippi was included because of the political power of Rep. Jamie Whitten. That made Elvis Presley, a native of the area, a genuine Appalachian. Today, students at Hollins University in Roanoke aren’t considered Appalachian, while those at Cornell University in New York are part of the 423-county ARC territory.
Virginia’s ARC success stories
Southwest Virginia has been home to some of ARC’s most transformative projects. The Grundy flood control and downtown relocation project stands as one of the commission’s engineering marvels, moving an entire business district to higher ground after repeated flooding and creating the unique three-story Walmart atop a public parking garage — a symbol of both economic renewal and the challenges of relocating parts of a town in mountain geography.
Recent ARC investments in Virginia tell a story of targeted economic development. The Southwest Virginia Workforce Development Board in Lebanon received $1.5 million for the Recovery Opportunities and Pathways to Employment Success (ROPES) project, providing job training for displaced coal workers. Virginia Community Capital in Christiansburg secured $2.5 million to strengthen access to capital for small businesses across the region.
These projects operate through Virginia’s LENOWISCO planning district, which serves Lee, Scott and Wise counties, and the Mount Rogers planning district, covering counties from Grayson to Washington. Both districts have leveraged ARC funding to build water and sewer systems, support workforce development, and promote heritage tourism — investments that would disappear under Trump’s proposed cuts.
The land question in Southwest Virginia
Ron Eller, retired professor of Appalachian Studies at the University of Kentucky and a Whisman Scholar at ARC, has long argued that true regional renewal requires more than infrastructure and outside investment. As Eller puts it: “Struggling regions of the country need land reform, including the reduction of absentee land ownership and the promotion of alternative land use.”
Eller’s research highlights how generations of absentee corporate and elite ownership have drained Appalachia of its wealth and stifled local development. He emphasizes that growth without real development — without addressing who owns and benefits from the land — will never be enough to reverse the region’s fortunes.
The land ownership patterns that have stunted Southwest Virginia’s development mirror those across Central Appalachia. In Wise County, absentee landowners were found to own more than 30 percent of all deeded land, according to state records. A startling 24 percent of the land in the county is owned by just one entity, coal and natural resource company Penn Virginia Operating Co., LLC. Penn Virginia is listed as the owner of more than 58,000 acres and Heartwood Forestland Fund nearly 28,000 acres, or 22.5 and 10.7 percent of the county, respectively.
The Nature Conservancy has begun managing former coal and timber lands in the region, including 220 acres of former mine land near the town of Pound in the Red Onion section of the county, owned by the Cumberland Forest Limited Partnership and managed by The Nature Conservancy. Recent agreements have opened up to 65,000 acres of reclaimed mine land for new energy projects, but these massive holdings remain concentrated in corporate hands.
These absentee ownership patterns, documented in ARC’s shelved 1980 land ownership study, continue to drain wealth from Southwest Virginia. Coal and timber companies pay scandalously low property taxes on holdings that often represent 30-70% of a county’s best development land, leaving local governments starved for revenue while corporations extract resources and profits.
The economic and social data make clear the mission of ARC is far from complete in southwest Virginia. According to the Appalachian Regional Commission’s latest FY 2026 County Economic Status Designations, Buchanan, Dickenson, Lee and Wise counties in Southwest Virginia are classified as “distressed,” among the 75 such counties across the ARC’s 13-state region. This designation reflects persistently low income, high poverty rates and elevated unemployment levels.
Data from the Economic Innovation Group — cited in Axios Richmond — shows an extraordinary dependency on federal transfers in these counties for the baseline year 2022. In Dickenson County, transfer payments (including Social Security, Medicare, Medicaid, Black Lung benefits, and other federal sources) constituted 49% of total personal income; Lee County followed closely at 47%, while Wise and Buchanan each recorded roughly 45%. This is in stark contrast to the statewide average of around 13–14%, and the national average of about 17.6%.
This heavy reliance underscores the economic severity in distressed parts of Southwest Virginia — nearly half of local income derives not from private sector activity, but from public assistance programs.
The stakes for Southwest Virginia
The proposed 93% cut would imperil ongoing and planned projects across Southwest Virginia. Current ARC-funded initiatives at risk include workforce training programs at Southwest Virginia Community College, water system improvements in rural communities and small business development loans that have supported everything from craft breweries to technology startups.
Sen. Warner and Sen. Kaine have repeatedly celebrated ARC investments in Southwest Virginia, noting that the funding “aims to stimulate the local economy by promoting job growth, increasing access to capital, and supporting local businesses.” Their previous success in fighting off Trump’s 2018 defunding proposal demonstrated the political muscle needed to preserve these investments.
The Vance factor
That brings me to Vice President J.D. Vance, whose roots in Eastern Kentucky’s Breathitt County give him intimate knowledge of Appalachian challenges. Vance was propelled to national attention with his publication of “Hillbilly Elegy” in 2016. With his Silicon Valley connections and professed concern for the region, Vance could be Southwest Virginia’s most powerful advocate — or its greatest disappointment.
So far, Vance’s only major regional initiative has been AppHarvest, the failed indoor farming venture based in Morehead, Kentucky, where he served as both an investor and a board member alongside Martha Stewart. The company’s spectacular collapse raised questions about whether tech-world solutions can address deep-rooted regional problems or whether it was just ineptly managed. Oasthouse Ventures, a UK-based company specializing in low-carbon greenhouses, plans to invest $104.8 million to establish its first U.S. controlled environment agriculture operation in Carroll County, Virginia. They intend to build a 65-acre greenhouse at Wildwood Commerce Park, which will produce and package over 45 million pounds of tomatoes annually.
If Vance and his Silicon Valley allies genuinely want to prove their vision for reimagining how government works, as they say they do, supporting ARC and pushing for genuine reforms would demonstrate real commitment to the region that shaped his worldview. Southwest Virginia could serve as a laboratory for whether government can work differently and better.
A vision for reform
To truly transform Appalachia and Southwest Virginia, ARC must move beyond its legacy of highways and infrastructure and embrace a tech-forward, community-driven vision that is refashioned for the 21st century. A transparent, digital land ownership system would expose the web of absentee ownership that has plagued the region for generations. Local governments could finally enforce fair taxation and ensure that Southwest Virginia’s wealth benefits its people.
ARC and its political partners cannot continue to ignore the land issues in the coalfields. As the late attorney and activist Frank Kilgore of St. Paul, Virginia, has said, “Joining land with coalfield citizens would be a giant step toward fighting poverty one plot at a time. As Delmar said in O Brother, Where Art Thou?, ‘You ain’t no kind of man without land’ — a truth that applies to all genders. Land is security.”
A modern homesteading act could acquire land from bankrupt and ailing coal and timber companies, offering it to returning families and entrepreneurs. Gov. Glenn Youngkin’s administration, following the lead of Kentucky’s Gov. Andy Beshear, should locate new communities on higher ground above flood-prone areas — but coal and timber companies have been reluctant to offer their holdings for these efforts by Gov. Beshear.
Using modern analytics, ARC could help Southwest Virginia counties enforce honest property taxes on coal, timber and mineral holdings. Even modest improvements could generate millions annually for local schools, clinics, and infrastructure — resources long denied by absentee corporations.
The opposition and the response
Across Appalachia, more than 80 organizations have appealed to Trump not to cut ARC funding. Virginia voices among them include economic development officials who argue that ARC investments serve as crucial seed money for private sector growth. “Every dollar of ARC funding leverages three dollars in local and private investment,” according to one official. “These cuts would kill projects that are just beginning to show results.”
Looking forward
The region that was once “an island of poverty in a sea of affluence” stands at a crossroads. The bridge that ARC represents is more necessary than ever — not as a relic of the past, but as the foundation for a bold, tech-forward and community-driven future.
Southwest Virginia has the opportunity to lead this transformation. The region’s natural beauty, strategic location and emerging technology sector position it to become a model for post-coal economic development. But that future depends on maintaining the federal partnership that ARC represents.
Virginia’s congressional delegation understands these stakes. Their fight against Trump’s proposed cuts isn’t just about preserving federal funding — it’s about protecting Southwest Virginia’s chance to finally control its own destiny. After more than a century of extraction and exploitation, the region deserves that opportunity.
The question now is whether the Trump administration will recognize that Southwest Virginia’s transformation benefits not just the region, but the entire nation. The “bright highway of hope” that President Lyndon Johnson promised in 1965 remains under construction. Cutting ARC funding would abandon that road just as it begins to reach its destination. An administration that is cutting government because it insists old approaches did not work owes the country alternatives that do. Southwest Virginia can be the test bed for reimagining economic development in this century.
Jim Branscome, a native of Carroll County, worked for the Appalachian Regional Commission from 1969-1971. He is a retired managing director of Standard & Poor’s in New York City. A former journalist, his work has appeared in The New York Times, New York Times Magazine, The Washington Post and numerous other national newspapers and magazines.
