Appalachia Frets Over Definition of Poverty

From where he stands, Mike Wokaly cannot see how things have gotten any better over the past year in this bleak little Appalachian town of 700.

Few, if any, new jobs are coming into this corner of southwestern Pennsylvania, where the unemployment rate is way over the national average and where many of the coal mines have shut down over the years. People sometimes pay for groceries with pocket change or whatever they can scrounge up to feed their families.

But federal funding for Fayette City -- as well as hundreds of other rural communities in the Appalachians -- could be cut this year because Washington no longer classifies them as distressed.

“This area has not had any growth in five years. None,” said Wokaly, 70, a retired teacher, truck driver and veteran who lives off his Social Security. “It’s bad. Here, we have no economy. How they can cut subsidies to this valley is beyond me. Way beyond me.”

Thirty-two counties in the Appalachian region -- including Pennsylvania’s two poorest, Fayette and Greene -- will be upgraded from distressed status to transitional in the 2004 fiscal year, which begins Oct. 1. The decision was made by the Appalachian Regional Commission, a federal-state panel created in 1965 by President Lyndon B. Johnson, who declared his War on Poverty from the porch of a Kentucky shanty.

Only two Appalachian counties -- Webster in Mississippi and Grundy in Tennessee -- will be downgraded from transitional to distressed.

The ARC provides money for projects such as job training, health clinics, roads, sewer lines and high-speed Internet access.

By law, half of all ARC funding must go to distressed areas. This year, ARC handed out $66 million to the 410 counties that make up the swath of Appalachia that stretches from New York to Mississippi. But at least $33 million went to the 118 counties classified as distressed.

The remaining 292 counties had to fight it out for the rest of the money, handed out at the discretion of the 14 members on the ARC -- the governors of the 13 Appalachian states and one representative of the federal government.

ARC spokesman Duane DeBruyne said removal of 32 counties from the distressed list reflects an improvement, even if slight, in their economic future.

“This is good news for the region,” he said. “The job clearly is not done; these counties are clearly still significantly distressed. There are still challenges. But we are making progress.”

But local economic officials in Appalachia were shocked to hear that their counties were no longer considered distressed.

In Cherokee County, N.C., two bluejeans companies and a furniture factory shuttered their plants in the last several years, eliminating 2,000 jobs just as the 2001 recession hit.

A third of those jobs have since been regained, Cherokee County economic development director Bill Forsyth said, but mostly with store jobs that offer neither health benefits nor enough pay to support a family.

“Things have definitely gotten worse,” he said.

To qualify as distressed, counties’ poverty and unemployment rates must be at least 50% higher than the national average. And their per capita income can be no higher than two-thirds of the national figure.

Fayette County, Pa., met two of those three requirements for 2004. Its unemployment rate is projected at 6.7%, compared with a national rate of 4.3%. The county’s per capita income is $15,919 -- 62% of the national average, $25,676.

But its poverty rate failed, just barely, to meet the threshold. It is projected at 18% for 2004; the national rate is put at 12.4%.

Fayette County, population 148,000, received just over $1 million from ARC during the last fiscal year.

Tim Marema, programs director for the Center for Rural Strategies in Whitesburg, Ky., questions whether the numbers tell the real story.

“Counties can move off distressed rolls due to factors that are not about improvement, but actually about decline,” Marema said.

“Per capita income can go up when people finally get up and leave,” he said. “People can get off unemployment when what they’re really doing is concluding that there’s no chance of getting work and giving up.”