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Speaking of the Economy
Speaking of the Economy - Dave Clark
Speaking of the Economy
Aug. 26, 2021

Rural Spotlight: A Path to Redevelopment in West Virginia

Audiences: Community Advocates, Community Investors, General Public

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Dave Clark discusses the role of Woodlands Development Group and his organization's community development financial institution (CDFI) in driving community and economic development in north central West Virginia. He shares examples of Woodland's projects and the key ingredients behind their success, as well as discusses how CDFIs can support such projects. Clark is executive director of Woodlands.


headshot of Dave Clark
Dave Clark


Tiffany Hollin-Wright: Hi, I'm Tiffany Hollin-Wright, community development regional manager at the Federal Reserve Bank of Richmond. I cover two states in the Fifth District, Virginia and most of West Virginia.

I often come across interesting stories of innovation and perseverance in rural small cities and towns. Many of these spaces are anchored by community development financial institutions or CDFIs.

Today, I am excited to share with you one of those many stories. I am joined by Dave Clark from Elkins, West Virginia. Dave is executive director of Woodlands Development Group, a community development corporation or CDC, and Woodlands Community Lenders, a CDFI. Throughout this podcast, I will generally refer to both as "Woodlands."

Today, Dave and I will discuss Woodland's role in community and economic development in north central West Virginia. He will share some examples of the organization's signature projects that drive revitalization and also attract investment to the area, as well as some of the key ingredients and roles that CDFIs can play to make these projects successful. I encourage you to learn more details about Woodland's story in the accompanying Rural Spotlight article on the Richmond Fed website.

I look forward to speaking with you today, Dave. Welcome.

Dave Clark: Thanks very much, Tiffany. I'm very happy to be here.

Hollin-Wright: So let's get right into it. I'd love for you to start off by sharing a little bit about the history of Woodlands Development Group. Particularly, what is your mission and what challenges does your organization address?

Clark: I'm happy to do that.

Woodlands Development Group was created in the mid-90s by a local housing authority, the Randolph County Housing Authority. They were taking advantage of some new rules that had come down from HUD that allowed for the creation of community housing development organizations or CHDOs.

For the first 10, 15 years of our existence, we operated primarily as a subsidiary of that housing authority, focused mostly on single family housing development. We did a lot of that through the early 2000s, then they were able to bring on a part-time and then a full-time director.

Starting in the late 2000s, we were able to start branching out our mission, focusing in on some more of the needs of the community, including ramping up multifamily housing development pretty significantly. We've been able to do a lot in downtown redevelopment and supporting that. We now work a lot in community facilities like parks and trails, community centers, and green space.

Then, in about 2013, we created a CDFI in response to some of the concerns we'd heard from local entrepreneurs and businesses about getting access to capital. The CDFI started as a separate organization and in 2013 we started making loans then.

One of the decisions we've consciously made is that, rather than pick one or two things that we're going to do and spread out geographically, we've made the decision that we're going to focus in on our three-county service area. So, we work in three very rural counties in the northern mountains of West Virginia. We just try to do anything we can within our capacity to further the economic and community development goals of those communities

It is a very rural area — it's about 1,000 square miles but only about 50,000 people live in there. That's where we've tended to focus. We're starting to branch out a little bit now around the state and helping out some other organizations.

Hollin-Wright: Well, congratulations on your growth and evolution.

I'm interested in the role that Woodlands and Community Lenders has played in the Main Street redevelopment in Elkins. You talked a little bit about some of that work. Can you expand on that?

Clark: Yeah, absolutely.

We do a lot of work right now in our downtowns and main streets in the communities, and Elkins is a prime example. It is also where we're headquartered, right in downtown Elkins.

We take a two-pronged approach to downtown redevelopment. We make direct investments — we buy older buildings and fix them up, both multifamily as well as mixed-use commercial buildings. In our downtown area, we have a very strong relationship with our Main Street group.

The other thing we do is we work with a lot of private building owners to facilitate redevelopment of vacant space in our downtown. Because we have our own construction crew, we have relationships with architects and engineers. We work very closely with all the local banks. We're able to work with private building owners and help them do everything from assess building structure and code compliance to working on redesign, to then looking at construction costs, estimates, cash flow projections. Then, we're often able, through our CDFI arm, to help finance a portion.

One of the other kind of key roles we've come to play to is in packaging these projects together. In a lot of cases, we're able to put together all whole finance package and just walk down to the local community bank with some of these building owners. Knowing the local scene as we do, we often know who has an appetite for what kind of project. That's worked out really well. We can help facilitate a lot more redevelopment that way than we can just through our own individual investments.

Hollin-Wright: It certainly sounds like that's your "superpower" — having that real estate development capacity as well as financing.

You recently presented a project at the Opportunity Appalachia investor convening in February of this year — the redevelopment of the Tygart Hotel. As someone who travels often, I'm particularly interested in that project. What also sparks my interest is that the project is in an opportunity zone. Can you talk a little bit about that?

Clark: Elkins is a town of about 7,000 people. Even though it's a very small town, it's the commercial hub for the region and historically has always been the big railroad town.

The Tygart Hotel was the grand hotel of town. Presidents have stayed there. Senator Jennings Randolph famously lived there for about a decade. It's right in the center of our downtown, it's the largest building in 100-mile radius, or something.

It started changing hands in the mid-1900s and just kind of slowly went downhill. Until we purchased the building in 2017, 2018, it had become what we often refer to as "housing of last resort." It was a pretty rough place at that point. We went ahead and purchased the building at the request of several community members who asked if we could intervene. The community at that time, I'll say, asked not only could we purchase it, but could we also take a hard look at restoring it back to a hotel.

We didn't at the time know anything about hospitality or developing a hotel. What we did understand is converting it, keeping in housing, and cleaning it up that way. That's kind of where we thought we would end. But as we explored the project a lot more and brought on some consultants and did some market studies, the project looked really, really viable as a hotel.

Our first step was then to start reaching out to some hotel developers to show them the information we had, thinking that we could find a developer that would come in and take this on. We were not successful in that, in part, because even though it's a large hotel by our standards -- a planned 56 rooms — it's still relatively small. And being in a rural area, we just couldn't find a developer who would be willing to do it. So we decided to go and take that on ourselves.

We've been putting the project together now for about two years. We're getting close to the end. We have most of the financing lined up. We have a great hotel management partner who's come on board with us. We've signed on to a franchise agreement with a chain hotel and their boutique arm. We've got a great architect. And we've had just a lot of help from the whole community and from a lot of our state and national partners who also jumped in to help. The financing [will be] wrapped up by the end of the calendar year and we'll be starting construction at the beginning of 2022.

Hollin-Wright: Well, congratulations on that work.

Talk a little bit about the key ingredients that are required for a rural CDC and a rural CDFI to be successful on a project like this. It sounds like you've had to strengthen your internal capacities, both human and financial capital.

Clark: This will be a little over $14 million project, which is a big project for us. It's a big project anywhere in our region, so it's meant coming at this in a whole new way.

Tax credits really become the largest financing tool available for redevelopment and development in our downtowns. One of the things we struggle with here locally is that we don't have any large banks in our footprint that are incentivized through the Community Reinvestment Act (CRA) to make below-market investments in projects.

What we've done in this project, as well as in some other projects now, is engage our local community banks who have been just great partners of ours on several fronts for years now. Just starting about three or four years ago, we all went on a big learning curve learning more about the tax credits and how they could really work in a local context. We now have community banks who are pretty fluent, and now they understand these tax credits and they've started investing in these projects.

The Golden Rule is a big redevelopment we just completed in a neighboring community that involved local community bank investments in historic and housing tax credits. In this case, we've been able to secure a commitment of New Markets as well as historic tax credits. We're going to be working primarily with local community banks to make these investments and help put the whole project together.

One of the ways that communities can often fill gaps in projects like this is through Community Development Block Grant funding. Elkins is not big enough to secure those funds, so we've had to be very creative about how we fill those gaps. We're working now with some local community investors who are willing to take a pretty low return on an investment but want to see the project going forward. So that's one way we're working to address that.

Hollin-Wright: Dave, how does this play out in terms of the recovery in your geographies from the pandemic?

We conducted a survey in 2020 of how CDFIs, particularly rural, CDFI, were managing pandemic recovery. We noticed that there has been a change in debt-capital flows, particularly for rural CDFIs, distinct from the national sample and that more rural CDFIs are seeing increased federal investment.

That, coupled with your work with community banks and large banks, hopefully has benefited the area. Are there other innovations that's helped with recovery?

Clark: Thankfully, we've been able to access vehicles during COVID that have been really helpful.

A lot of our community banks particularly have been good partners ever since we started the CDFI, as I mentioned. They were also doing a great job in being responsive to local businesses around the PPP loans that came out. We were able to facilitate a lot of those and help package a lot of PPP applications for local businesses, going to our local banks. And that worked out really well.

The other thing that we do on a regular basis is try to take advantage of the regional and federal intermediaries that are out there in the community development and CDFI world. For instance, at the state level we have a great statewide CDFI that's a membership organization: CommunityWorks in West Virginia. Regionally, we do a lot of work with Fahe based out of Kentucky. Appalachian Community Capital is another regional group; they were able to get to leverage some grant funding for us that really helps support our staffing through COVID so we could really focus our attention on the businesses that needed some assistance. A great partner was Rural LISC and they, too, helped us out as did Opportunity Finance Network (OFN), a CDFI membership organization.

What we are able to do as a local CDFI, in addition to helping facilitate PPP loans, we were able to also kind of transition some of our technical assistance to businesses and help do a lot of things in response to COVID, like develop online sales platforms. We worked with dozens of local businesses to move to online sales platforms, and that has made a big difference for a lot of local businesses.

There are also a lot of the larger groups that were making grants available and funneling them through some of our national intermediaries. Because we had a good connection with those national groups, we're able to kind of tailor some applications for local businesses and leverage a lot of grant funding directly to those small businesses. That was really helpful, I think, for some of these businesses.

Then, both Appalachian Regional Commission and the CDFI Fund, I think, really stepped up and tried to be responsive to the needs of businesses during COVID. We were able to get access to some capital that we could then turn around and make available to businesses in the form of low-interest, long-term loans to help recovering businesses come out of COVID strong.

Hollin-Wright: Wow … Looking forward, we are hoping that recovery will continue. But when you think about long-term, sustained change and support for the work of rural CDCs and CDFIs, what do you think should be the federal, state and local policy considerations so that you can further your work?

Clark: That's a great question.

I want to really applaud the CDFI Fund under the Department of Treasury. They've recently made available to CDFIs relief and recovery program grants. They're a great funder to work with.

As you may know well, they provide what we often refer to as enterprise level investments. While we're held to some very ambitious goals in terms of deploying capital and supporting businesses and we have to meet those, how we are able to use their investment is really up to us. So, it's great funding in that way. I think there's talk of more funding being made available to CDFIs through the CDFI Fund and I hope that comes to fruition.

One of the other things I'm really interested in is state-level incentives that have been put in place in the last few years in some other states that I'm hoping we can replicate here in West Virginia that have shown to be just great tools to incentivize investment into CDFIs and into development projects as well.

There are a couple other things that get a little wonky, but they could really help on our development side. One of the things that we've always been up against in West Virginia is how a lot of federal programs define and determine need and eligibility. A lot of the measures that we use to make those determinations are relative measures. In other words, we're often assessing a household income against accounting income, and you can't cross a certain threshold and be eligible for that. In West Virginia where we have traditionally much lower incomes than much of the country, it really limits who we can serve with some of our programs. There's a move afoot at the federal level to recalibrate how we determine need and eligibility that I think could benefit states like West Virginia really well. And I'm hopeful they are.

Hollin-Wright: We're hopeful as well. It's been amazing having you share your wisdom and insights with us after so many years of experience, and we know you'll continue on the work.

Clark: One of the key pieces I'd like to mention, too, is just the real value we see in getting together with our peers around the state. There's really so much value that comes out of some of these discussions. A lot of the work we're doing, we've just taken what our peers are doing and figured out how to replicate it at the local level.

One great example is the fact that the Richmond Fed was able to convene all of the non-traditional lenders in the state several years ago, and that's evolved into a regular meeting group. That same group now has helped push for some of this financing I just referenced that came down from ARC and others. Several of us have been able to work together to affect policy and open up opportunities such as that.

Hollin-Wright: Dave, once again, thank you. It's been a pleasure having this discussion with you.

Clark: Thank you very much, Tiffany. Always a pleasure to talk to you.