President announces new Promise Zones, includes parts of Kentucky

WASHINGTON (WKYT) - Update 3:15 PM Thursday:

President Barrack Obama announced the creation of five "Promise Zones" this afternoon in Washington. These zones will attempt to help areas out of poverty by providing federal tax incentives and distributing grants. The president's announcement as well as comments from Senator Mitch McConnell can be found at the top of this story.
Original Story:

Local leaders say President Barack Obama is expected to announce this week an initiative designating several Eastern Kentucky counties as "Promise Zones".

President Obama's announcement is part of a focus on income inequality in the lead-up to his State of the Union address. Promise Zones are areas where the federal government provides tax incentives and grants. President Obama first announced the initiative during last year's State of the Union speech.

Local leaders say a poverty rate around 25% and more than one thousand lost coal jobs led to eight Eastern Kentucky counties being designated a Promise Zone.

Local leaders say the counties are Bell, Harlan, Letcher, Perry, Leslie, Clay, Knox, and part of Whitley County. The area has a population fewer than 200,000 people which is a requirement to receive the Promise Zone declaration.

Officials say these counties will get priority on funding and possible tax breaks to fight poverty and recruit new industries.

"It's bittersweet. The EPA and federal government kind of put us in this spot to begin with, so we're optimistic that this program will be a hand-up, not another hand-out," said Albey Brock, Bell County Judge-Executive.

Kentucky Highlands Investment Corporation (KHIC) worked with government leaders in the eight counties to apply for the Promise Zone declaration. Of the five areas chosen, Eastern Kentucky is the only rural region selected.

"We want to work on enhancing the economy, the broad sector, increase internet access, want to do a whole host of activities in the communities, have been working on for some time to improve the region and enhance income opportunities for the families there," said Jerry Rickett, President of KHIC.

Some leaders tell us they are hopeful it can bring new jobs to the area.

Governor Steve Beshear claims coal layoffs led to $94 million in lost wages in in the local economy.

"The biggest thing we're hoping for is to entice people to locate in Perry County and put some of our people back to work," said Randy Bailey, Perry County Economic Development Director and Deputy Judge-Executive.

"If we can incite industry to bring jobs to Eastern Kentucky, this could be a tremendous program for our region," said Bell County Judge-Executive Brock.

Kentucky Highlands officials say this will be a team effort to help the eight counties.

"It's really going to be an all hands on deck effort to try and do some positive things for our region," said Rickett.

Democratic Governor Steve Beshear endorsed Kentucky Highlands' bid for the Promise Zone and says this is part of the SOAR initiative.

Gov. Beshear also wrote a letter supporting Kentucky Highlands Investment Corporation's application for the program.

"As we know, there is no single solution to the many challenges facing Eastern Kentucky; rather, any meaningful plan will require a broad combination of efforts to transform the economy of this region," Beshear said in a statement. "The Promise Zone is a very exciting and important component of that path for success that will make an accelerated positive impact on the future of Appalachia."

Republicans Kentucky Senator Rand Paul and Congressman Hal Rogers say the Promise Zone idea could be a step in the right direction.

"I'm finally glad the administration has awakened to the economic problems that are facing Southern and Eastern Kentucky due to the coal job losses. This program I think has the promise, if you will, of encouraging private industry to move into our communities and hire people," said Rep. Hal Rogers, (R) Fifth District.

"We're excited that the President has been reading our press releases and looking at our legislation. About a month I ago I introduced this concept called Economic Freedom Zones, so we're pleased that the President is thinking about some of the same ideas that we have. We haven't had a chance to look at all of his proposals, but our proposal for economic freedom zones would dramatically reduce taxes and would leave a significant amount of money in Eastern Kentucky," said Sen. Rand Paul, (R) Kentucky.

Senator Paul also said he does not believe spending government grants is necessarily a good idea.

Republican Senator Mitch McConnell also applauded the Promise Zone designation.

"I'm pleased the administration has decided to grant Eastern Kentucky the Promise Zone designation it deserves," McConnell said in a statement Wednesday. "I wrote a letter last year supporting this designation because this region has suffered enormous economic hardship over the last several years. Thousands of jobs have been lost and economic opportunity is extremely limited, particularly because of this administration's hostile policies toward the coal industry."

Senators McConnell and Paul also partly blamed the Obama administration's policies on coal for the loss of thousands of jobs.

Kentucky State Representative Tim Couch (R-District 90) who represents Leslie County issued a statement on the Promise Zone.

"It's nice to know that after everything the Federal Government has done to destroy our region with their overreach on the coal industry, they are actually doing something to try and undo the damage they've brought up Leslie and other counties. While I am somewhat skeptical about this program because there are zero dollars tied to it, I'm hopeful with the business incentives this designation will bring some positive results for the people of Southeastern Kentucky."

Local leaders say a formal announcement on the Promise Zone declaration is expected in Washington D.C. this week.


WASHINGTON (AP) - President Barack Obama will announce five "Promise Zones" this week as part of his effort to focus on income inequality in the lead-up to his State of the Union address.

Promise Zones are areas where the federal government provides tax incentives and grants to help communities tackle poverty.

Mr. Obama first announced the initiative during last year's State of the Union speech.

On Thursday, the president will announce the first Promise Zone locations. They're in San Antonio, Texas; Philadelphia; Los Angeles; Southeastern Kentucky and the Choctaw Nation of Oklahoma.

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