ARC Fall Conference Focuses on the "Rural Advantage"

by Fred D. Baldwin

The 2005 Appalachian Regional Commission (ARC) conference opened with a challenge to participants to build on the unique assets of their rural and small-town communities. They were then served generous helpings of practical advice on how to do that. The conference, held October 5-6, 2005, on the campus of Muskingum College, in New Concord, Ohio, attracted approximately 240 attendees. Its theme was "Winning the Economic Future: The Rural Advantage."

Ohio Governor Bob Taft, ARC's 2005 states' co-chair, opened the conference with a warm welcome. "I can testify that ARC is getting results in Ohio," Taft said, "and I know that you can tell similar stories in your states." He urged attendees to make sure that those stories were heard by national decision makers and referred to ARC grants as "dollars that stretch farther and get greater value than almost any other federal investment."

Anne B. Pope, ARC's federal co-chair, expressed appreciation for Taft's leadership. After noting that a shift to a knowledge-based economy poses challenges and offers opportunities across the Appalachian Region, she summed up the conference theme in two sentences: "We know that there's no better place to live than Appalachia. We need to use our assets to our advantage."

Taft and Pope spoke only briefly, choosing to leave a fuller development of the conference theme to its keynote speaker, Charles W. "Chuck" Fluharty, director of the Rural Policy Research Institute, located in Columbia, Missouri. Fluharty, a native of Appalachian Ohio, is a faculty member at the University of Missouri-Columbia's Harry S. Truman School of Public Affairs.

Fluharty opened by commenting that rationales for rural economic development policy tend to be based on negative, "deficit-based" data; for example, gaps between urban and rural areas with respect to residents' earned income, educational attainment, and health. He urged that these problems, while real enough, not be allowed to drive a rural policy agenda.

Data that rural areas get fewer funds on a per capita basis than urban areas are accurate enough, Fluharty said, but this generalization can obscure a more serious problem: transfer payments to individuals account for a greater percentage of federal spending in rural areas than in urban areas. However valuable welfare and health-related transfers may be to their recipients, they do little for a region as "investments in capacity building."

"We must re-brand rural America," Fluharty said. "When you say 'rural' today, urban and suburban folks tend to think about agriculture and the bucolic life, not innovation. The image of rural America today is #2 yellow corn. We must change that." Pointing to a banner displaying the conference theme, he added: "We need a new rhetoric for why America should care about rural areas, and that's it--the rural advantage!"

Fluharty urged creative use of regional coalitions, including public-private partnerships, and more support for entrepreneurial efforts. He gave special emphasis to the potential role of institutions of higher education, whether universities or community colleges. Educational institutions, in addition to being able to offer assets under their own control, can provide credibility in dialogue with partners and investors outside a community's immediate area.

Renewal from Within

Fluharty also urged leaders from rural communities to resist "homogenization, commoditization, and urbanization"--policies and programs designed to make every small community like suburban America. Communities that yield to these pressures may be rewarded with some measure of economic improvement, but they risk forfeiting their rural advantage as uniquely interesting places to live and work.

It follows, Fluharty concluded, that economic development must be a highly participatory process, ultimately driven from within an area, with all stakeholders at the table. He cited Kentucky essayist, poet, and farmer Wendell Berry's affirmation that economic renewal of rural communities offers the potential to reinvigorate the sense of community across the entire nation--but only if that renewal develops "from the inside and from the wish to be at home."

Amy Glasmeier, ARC's current John D. Whisman Scholar, also delivered a message of renewal. Glasmeier, who is a professor of economic geography at Pennsylvania State University, gave attendees a systematic analysis of regional demographic and economic trends, most of them positive. She explained how a more prosperous Appalachia benefits the nation as a whole. Like Fluharty, she emphasized that lasting renewal must come from within Appalachia itself.

"We have a regional consciousness that distinguishes us from every other region in the United States," Glasmeier said. "There's a sense of shared knowledge here that gives this region advantages compared with other parts of the country. We don't need to buy every good idea that comes down the pike. We need to think about what actually fits us."

During the noon lunch session, delegates heard a televised message on the same theme from U.S. Senator George V. Voinovich of Ohio. He stressed the importance of partnerships and of a broadband telecommunications network that links Appalachia to the nation and the world. "ARC is critical not only to Appalachian vitality," Voinovich said, "but to the economic competitiveness of the nation."

Participants chose among eight breakout sessions offered under such labels as "A Is for Asset," " Appalachia Goes Global," and "Green Hills and Golden Opportunities." Each session covered issues from multiple perspectives. Anyone moving from session to session would have heard ideas and initiatives that can be loosely categorized under three broad headings: recognizing and developing local assets; creating synergy through partnerships; and planning and building for the long run.

Recognizing and Developing Local Assets

The presentations of several panelists brought to mind a comment by Yogi Berra: "You can observe a lot just by watching." That is, the panelists encouraged their audiences to take a fresh look at assets specific to their own areas--especially assets that local people take for granted.

For example, during a session on "Nature's Economy," participants learned how landowners in rural counties with extensive woodlands and forests earn profits by growing and harvesting non-timber forest products, including mushrooms and ginseng. Colin Donohue, then director of conservation-based development for Rural Action, in Trimble, Ohio, also noted that various agricultural products offer possibilities as feedstocks for small-scale biotech operations. His general advice: "Think about petroleum replacement as an opportunity."

That same session addressed the intangible asset of local product branding. Creating consumer identification with local producers offers an almost cost-free way to add value by providing a "story" to what might otherwise be a commodity. Consumer concerns about health or other quality-control issues can be addressed explicitly. "The more local it is, the better," said Virginia Kasinki, a training and support program manager for Glynwood Center, in Cold Springs, New York. "Consumers want to know the farmers. In the Finger Lakes district, everyone puts the initials of the farmer on every case of product that goes out."

Old buildings may also be an asset. In another session, Martha Cato from Valley, Alabama (population, about 9,000), described her small town's plans for two old textile mills located near the Chattahoochee River--including a downtown farmers' market and river-based recreational activities.

Lisa Petraglia, director of economic research for Economic Development Research Group (a Boston-based consulting firm), offered a systematic look at the sometimes underestimated potential of industry clusters. Cluster-based development adds economic value by exploiting areas of common need of firms competing in different niches of a broadly defined industry group. The wood-products industry in West Virginia and Pennsylvania provides a familiar Appalachian example. Some firms do forestry and logging; others manufacture finished or semi-finished woods products.

Petraglia reminded her audience that Appalachia has many such clusters. There are, for example, areas where firms support the automotive industry by building everything from truck bodies to automotive parts. Other areas have become competitive in high-tech niches. The challenge for many areas, she said, is not to create a cluster from scratch but to recognize common needs among existing firms--for example, for investment in research or for specialized skills training. "You need to look," Petraglia said, "for the deflection points where public policy can intervene."

Creating Synergy through Partnerships

During a pre-conference evening at the Wilds, a nearly 10,000-acre zoological park in southeastern Ohio, conference attendees got close-up views of giraffes, rhinos, and other exotic animals from several continents, all roaming freely within areas larger than most Appalachian farms. The Wilds is a research and conservation-oriented wildlife park developed on hilly land that was once stripped of its soil and vegetation by surface mining. Governor Taft called it "a treasure . . . one of the best examples anywhere of restoring and reusing a depleted area." The Wilds' executive director told attendees that the success of the project could be summed up in three words: "Partnerships, partnerships, partnerships." Speakers at virtually every conference breakout session repeatedly used those same words.

Chuck Borsari, a stained-glass artisan with a studio in Stockport, Ohio, described the marketing savvy of the Artists and Orchardists of Hickory Ridge, a 10-member marketing cooperative located in "a super-rural area that has been losing population steadily since 1860." He explained that each shop is individually owned, but the group uses techniques ranging from signage with a common look to gift certificates that have to be spent in more than one place. Hickory Ridge, pretty far off the beaten track from just about anywhere, has attracted customers from all 50 states and from about 25 other countries.

In another breakout session, Peggy Pings, an outdoor recreation planner and program manager of the West Virginia Field Office of the Rivers, Trails, and Conservation Assistance Program of the National Park Service at West Virginia University, described a 50-mile rail-trail and water trail extending out from Morgantown, West Virginia. She pointed out that developing attractions around these kinds of assets leads naturally to partnerships across governmental lines. "It's like a watershed model," Pings said. "What happens upstream affects what happens downstream."

A session labeled "Appalachia Goes Global" put the partnership theme into worldwide perspective. Speakers cited the importance of picking the right partners when entering foreign markets. Ramsey Bader, an international market specialist for Edgetech I.G. Inc., a manufacturer of structural foam products based in Cambridge, Ohio, ranked this piece of advice high on the "lessons learned" list of his firm's sales growth in Europe and Asia.

Planning and Building for the Long Run

No panelist promised anyone a quick fix for anything. On the contrary, speakers in all sessions advocated a long-range perspective coupled with investments in human capital, whether or not payoffs are immediately apparent.

Phillip J. Obermiller, a research associate at the Appalachian Center at the University of Kentucky, in Lexington, documented demographic changes important to long-range planning. Some demographic trends are sobering--for example, in-migration by individuals and families with low incomes, low skills, and low levels of educational attainment. But other trends may be more positive than they are often thought to be. For example, Obermiller debunked the notion that the Region's population is aging because younger people are moving away. Rather, most of Appalachia simply is "aging in place" because older people are staying put. "This is an opportunity, not a deficit," Obermiller concluded. "Older people have stable incomes. They may have more disposable income than people paying mortgages. And they attract high-income professionals like doctors."

Suzanne Teegarden, co-director for Workforce Learning Strategies, Inc., in Cambridge, Massachusetts, told participants in another panel that many communities "have gotten pretty good at responding to layoffs," but need to do better at replacing lost jobs. She urged systematic attention to local barriers to labor force participation, such as language, transportation, parenting demands, and, above all, educational attainment. Teegarden made an especially strong plea for leadership training and exploiting all educational resources. "Make the community into a college town," she said. "Healthy communities have active civic participation in community life."

Leslie Lilly, president and CEO of the Foundation for Appalachian Ohio (FAO), in Nelsonville, described FAO's strategy for building a fund of permanent assets through endowments. Created in 1998 to serve the 29 counties of Appalachian Ohio, FAO actively solicits gifts and bequests from private sources and has disbursed more than $1 million in grants for economic and community development projects. Endow- ment gifts, Lilly said, provide a long-term way of "helping the region invest in itself." FAO recently launched a program to increase access to post-secondary education opportunities under the name "I'm a Child of Appalachia."

The Brushy Fork Institute at Berea College, in Berea, Kentucky, operates a leadership program to encourage high school students to participate on community boards. Jane Higgins, a Brushy Fork program associate, explained how the program is targeted neither at "problem kids" nor at academic high achievers. It aims instead at talented young people who seem likely to stay in their communities after graduation from high school or college.

David Scholl, president and CEO of Diagnostic Hybrids, Inc., an Athens, Ohio, biotech firm, re-emphasized many speakers' cautions against accepting rural and small-town stereotypes, even those that sound relatively harmless. "I'm concerned," Scholl said about his own area, "that we don't get branded as a beautiful part of the state where nothing is happening. We're not Columbus or Cleveland, but that doesn't mean that we're not in the forefront of our field."

At a final plenary session at the end of the day, speakers from several different breakout panels fielded questions from the audience. Scholl summed up his impressions of the conference theme, based on how other panelists had described their results during presentations and more casual conversations. "Anything of value was locally driven," he said. "We won't get it right across a region if we don't get it right at home."

Fred D. Baldwin is a freelance writer based in Carlisle, Pennsylvania.
March 2006