Success of Just Transition in community’s hands
Just Transition Advisory Committee members made clear in a town hall meeting in Craig last month that the communities who weather a transition from coal to alternative industries are those that take control of the process themselves. The committee won’t be providing the plan for economic viability, but rather the support for the community to organize itself and define a vision and strategy.
The Committee was established as a result of House Bill 1314. The bill’s primary goal is to provide transition assistance to workers and communities impacted by Colorado’s move away from coal-based electrical generation by 2030.
“If Just Transition is going to be an effective partner with Craig and Hayden and other communities facing this transition, it will first be because those communities are leading the way and driving the process internally,” said Wade Buchanan, Director of the Office of Just Transition housed under the Colorado Department of Labor and Employment.
Craig City Councilor Ryan Hess fears that a common problem in rural America is a dependency upon outside resources to fix things and a lack of experience within communities to diversify the economy until it’s an emergency.
“I think we’ll hide and wait to see what the state and federal government do before we take local action,” Hess said. “We can’t wait until we hear a plan we don’t like to be angry; we need to come up with a plan locally right now. Brainstorming how to take our out-of-place workers and repurpose them locally is more beneficial than brainstorming who can come save us.”
Still, some communities naturally transition more easily than others.
Mark Haggerty of Headwaters Economics who leads the team’s research in tax policy, rural economic development and community planning around energy and economic transitions was quick to point out that communities who transition successfully have a distinct set of advantages that not every place has. Outside of major airports, universities and national parks, there are “precious few” examples of places that have successfully transitioned.
“The ability of a community to come together around a common vision and a strategy to implement that vision is critical, and that’s really difficult for a lot of these coal communities to come around to,” he said. “There’s an immediate reaction to want to defend what you have because the future is scarier.”
“The strategy and vision has to come locally. If there isn’t one, there’s nothing that the state or the committee is going to do to help. Once you have that strategy and vision in place, there’s a lot that the state can do to help.”
Developing big industry ideas without an investment in people and local institutions as well as policy reform could see Moffat County build the proverbial bridge to nowhere.
Hess sees things similarly with a vision that there should be a focal person whose day-to-day task is looking for grant money, making sure that economic development efforts are all in alignment and whose role is to bring thought groups together.
“We can’t take on ideas and delegate them to a bunch of people who already have full-time jobs; we need one person who wakes up in the morning whose mission in life is to find economic stability and then growth,” Hess said.
Reinventing the industry that can drive Moffat County’s economic engine as well as unemployment and the loss of a strong skilled work force have been a focus of the conversation related to Just Transition, but driving fiscal policy change is a critical component of long term success, too.
Experts who have seen similar transitions – both successful and unsuccessful – in other communities recognize that the viability of towns like Craig depend on the health of critical infrastructure, which is a unique struggle when transitioning from coal-based industry. Big mines and power plants have paid the bills for a long time, and a transition to renewable energy simply doesn’t provide the same kind of financial returns.
“An important piece in Colorado is reviewing the incentives around renewable energy. If you replace a coal-fired power plant with a solar or wind energy facility of the same size, you’re going to get substantially less revenue from it and it’s because the state has made a conscious decision to incentivize renewable energy and the way that they incentivize it is by giving them property tax breaks,” said Haggerty “So the state has essentially given local government money away to meet a state priority and it doesn’t work for these communities. We have to change that. If the state wants to incentivize it, great. But don’t take it out of local government’s budgets.“
According to Craig City Manager Peter Brixius, efforts are underway in Moffat County to gather public information, explore new industries and get input from local businesses, though there is not a formally organized group or communication channel as of yet.
“Since the announcement in January, the state has been tremendous in the amount of attention this part of the state has received,” said Craig City Manager, Peter Brixius. “ Senator Rankin has especially been involved with the community and has tried to initiate various meetings with a good cross-section of the pubic and private partners and educational institutions. We are trying to define what our priorities would be if there are allocated resources.”
By all accounts, this is an urgent issue, but it’s not immediate.
“We expect that coal is on its way out in the whole region, but the only timeline we really have is the one that Tri-State has given us, and we’re five years out from the first closure,” Buchanan said. “This first year is really about both the state and the communities trying to come together to develop the framework we need to put in place.”
Memorial Regional Health is a critical infrastructure in Moffat County and with the introduction of COVID-19 to an already stressed system, the importance of industry that can sustain community healthcare is even more important today.
“Healthcare is part of the backbone and fiber of a community. We’re going to need to be here no matter what,” said Jennifer Riley, Vice President of Operations at MRH.
Tax base erosion and the erosion of a strong employer base will mean a bigger switch from commercially insured to uninsured or Medicare/Medicaid.
“What a benefit it is to have time and to know what’s coming and to be prepared for it and to plan for it,” Buchanan said. “Let’s not squander that.”
It’s not all gloom and doom.
There are potentially advantages for communities based on their costs and quality of life to attract different kinds of businesses, Haggerty said. They will need infrastructure – broadband, access to markets, skilled labor force. And that doesn’t happen over night. If you have an intentional policy to get there with support from the state, you can start putting those pieces together.
“It’s not just Colorado that’s experiencing the transition. Colorado has some advantages that other states – such as Montana and Wyoming – don’t have,” Haggerty said. “Colorado’s economy is not dependent on coal. You’ve got the political capital and attention of the legislature and the governor.”
Haggerty believes that it’s not too big an ask for the state to provide some short-term assistance in terms of planning support so that communities have the time and the resources to gather information and learn from their peers.
“If I had my magic wand, there would be someone in the area that networked across county and state governments and their goals would be: economic growth and development, preparing for economic correction, transition from one economy to the next and create ways to find full-time skilled jobs,” Hess said.
“The coal transition has galvanized a rhetoric and a commitment that’s kind of unique. These communities have quite a bit of resources at their disposal if they know how to ask for it,” he said. “And it’s usually not a lack of money that’s the problem. It’s a lack of strategy and vision.”’
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