Wednesday, February 24, 2016

The real cost of the “War on Coal”

 Part Two of a three part series that looks at the impact of mine closings in the area

J-E Editor

Hopkins and Webster counties were born with coal in their veins, so it’s no surprise that many of the industries located here rely on the mines for their business just as those in early mining towns did. From staffing services to trucking companies, those businesses were founded to fill a need.

That design has created a lot of successful business relationships throughout the coal regions of the United States, but it has also set local economies up like a series of dominoes just waiting to be knocked over.

The first Kentucky coal mine opened in 1790 in Lee County, according to Kentucky Coal Facts,  an annual publication produced by the Kentucky Energy and Environment Cabinet and the Department for Energy Develoment and Independance, in partnership with the Kentucky Coal Association. By the end of the next century, Kentucky coal was in demand across the continent and a booming industry had been formed.

Unlike other industries, coal companies didn’t typically move into a town and open for business. Mines opened where the coal was, often building their own towns and camps at coal seams located near the commonwealth’s growing railroad system. The towns that grew up around the mines included many secondary industries that provided labor and services for the mines.

“In the late 1970’s, we had 40 mines within 100 miles of Providence,” said State Representative Jim Gooch. “Now there are 10 or 12. That really changes things. Every dollar spent by the mines turns over seven times as it passes through other businesses. The loss of that money hurts everyone.”

Many of the struggles often go unnoticed by the community, but they are felt by the people affected. Consider Wright Trucking in Clay, a business that has hauled coal since the 1950’s.

“We haven’t hauled a load of coal in several years,” said Sheila Puttman. “We’ve gone from 35 trucks down to ten, and we’ve had to find other things for those remaining drivers to haul. It’s been bad.”

Most of Wright’s business is now over the road loads, which require drivers to be gone for days at a time. That’s a drastic change from the days when the bulk of the company’s employees got to go home every night and spend time with their families.

“Even some of that work has suffered,” said Puttman. “For years we’ve hauled two or three loads of oil for the mines each week from West Virginia to Home Oil and Gas in Henderson. Recently we’ve just been getting one load. This week and next we have zero. Its just a vicious cycle.”

Also feeling the crunch are many of the machine and fabrication shops that have for years serviced the various mines in the area.

“There have been several shops in the area to already go out of business,” said Eddie Gooch, co-owner of West Kentucky Steel in Providence. “We’re doing a little better because we’re more diversified than some of the others. We do a lot of work with rock quarries and some steel jobs for other industries. But we’re even starting to see a lot of those businesses cutting back on what they’re spending.”

Even the banking industry is not untouched by the changes in the industry.

“We’ve seen some changes, but we have yet to feel the full impact,” said Mickey Dunbar, the Sebree Planter’s Bank branch manager. “It hasn’t even come close to what we’ll see. These mine closings will have a domino affect that we will start to see as spring comes and the other mines close.”

For the banks, the first sign of trouble is the day when miners stop coming in to make deposits and withdrawals. Then comes the day that they cannot meet their loan payments.
“Some people will have to put their houses up for sale and move,” said Dunbar. “Others will simply lose their houses because they can’t afford the payments. As that happens, property values will drop.”

Dunbar urges anyone who lost a job during recent or upcoming mine closings to go to their local bank as soon as possible.

“They need to talk to their banker before things get bad,” he said. “If they will do that, it will really help them. We can take a look at their finances and maybe find a way to help them get by until their find another job. Don’t wait until you defaulted on a loan or missed a payment.”

Next week, in part three of this series, we will speak with some local businesses that don’t deal directly with the mines, but are still feeling the crunch as the industry struggles.

 at 270-667-2068 or

No comments:

Post a Comment